As filed with the Securities and Exchange Commission on March 12, 2015
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form S-4
REGISTRATION STATEMENT
UNDER
THE
SECURITIES ACT OF 1933
THE TIMKEN COMPANY
(Exact
name of registrant as specified in its charter)
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Ohio |
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3562 |
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34-0577130 |
(State or other jurisdiction of
incorporation or organization) |
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(Primary Standard Industrial
Classification Code Number) |
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(I.R.S. Employer
Identification Number) |
4500 Mt. Pleasant St. N.W.
North Canton, OH 44720-5450
Telephone: (234) 262-3000
(Address, including zip code, and telephone number, including area code, of registrants principal executive offices)
William R. Burkhart
Executive Vice President, General Counsel and Secretary
4500 Mt. Pleasant St. N.W.
North Canton, OH 44720-5450
Telephone: (234) 262-3000
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
Michael
J. Solecki
Jones Day
901 Lakeside Avenue
Cleveland, Ohio 44114
Phone: (216) 586-3939
Fax: (216) 579-0212
Approximate
date of commencement of proposed sale of the securities to the public: The offering of the securities will commence promptly following the filing date of this Registration Statement. No tendered securities will be accepted for exchange until
this Registration Statement has been declared effective.
If the securities being registered on this Form are being offered in connection
with the formation of a holding company and there is compliance with General Instruction G, check the following box. ¨
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) 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 post-effective amendment filed pursuant to Rule 462(d) 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. ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.
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Large accelerated filer |
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x |
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Accelerated filer |
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¨ |
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Non-accelerated filer |
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¨ (Do not check if a smaller reporting company) |
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Smaller reporting company |
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If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this
transaction:
Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer) ¨
Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) ¨
CALCULATION OF REGISTRATION FEE
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Title of each class of
securities to be registered |
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Amount
to be
registered |
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Proposed
maximum offering
price per unit(1) |
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Proposed
maximum aggregate
offering price(1) |
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Amount of
registration fee |
3.875% Senior Notes due 2024 |
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$350,000,000 |
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100% |
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$350,000,000 |
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$40,670.00 |
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(1) |
Calculated in accordance with Rule 457(f) under the Securities Act of 1933 solely for purposes of calculating the registration fee. |
The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the
registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this registration statement shall
become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
Information contained herein is subject to completion or amendment. A registration statement
relating to these securities has been filed with the Securities and Exchange Commission. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This prospectus shall not
constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the
securities laws of any such state.
SUBJECT TO COMPLETION, DATED MARCH 12, 2015
$350,000,000
The Timken Company
OFFER TO EXCHANGE
UP TO
$350,000,000 IN AGGREGATE PRINCIPAL AMOUNT OF NEWLY ISSUED 3.875% SENIOR NOTES DUE 2024
FOR A LIKE PRINCIPAL AMOUNT OF OUTSTANDING
RESTRICTED
3.875% SENIOR NOTES DUE 2024 ISSUED ON AUGUST 20, 2014
On August 20, 2014, we issued $350,000,000 aggregate principal amount of restricted 3.875% Notes due 2024, which we refer to as the
Original Notes, in a private placement.
We are offering to exchange up to $350,000,000 aggregate principal amount of new 3.875% Notes due
2024, which we refer to as the Exchange Notes, for outstanding Original Notes. We refer to this offer to exchange as the Exchange Offer. The terms of the Exchange Notes are substantially identical to the terms of the Original Notes, except that the
Exchange Notes will be registered under the Securities Act of 1933, which we refer to as the Securities Act, and the transfer restrictions and registration rights and related additional interest provisions applicable to the Original Notes will not
apply to the Exchange Notes. The Exchange Notes will be part of the same series as the Original Notes and issued under the same indenture. The Exchange Notes will be exchanged for Original Notes in minimum denominations of $2,000 and integral
multiples of $1,000 in excess thereof. We will not receive any proceeds from the issuance of Exchange Notes in the Exchange Offer.
You
may withdraw tenders of Original Notes at any time prior to the expiration of the Exchange Offer.
The Exchange Offer expires at 5:00
p.m. New York City time on , 2015, unless extended, which we refer to as the Expiration Date.
We do not intend to list the Exchange Notes on any securities exchange or to seek approval through any automated quotation system, and no
active public market for the Exchange Notes is anticipated.
You should consider carefully the risk factors
beginning on page 8 of this prospectus before deciding whether to participate in the Exchange Offer.
Neither the Securities and
Exchange Commission, or the SEC, nor any state securities commission has approved or disapproved of the Exchange Notes or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is , 2015.
We are responsible for the information contained or incorporated by reference in this
prospectus. We have not authorized any person to provide you with any other information or represent anything about us or this offering that is not contained or incorporated by reference in this prospectus. We take no responsibility for, and can
provide no assurance as to the accuracy of, any other information that others may give you. We are not making an offer to sell the Exchange Notes in any jurisdiction where an offer or sale is not permitted. You should not assume that the information
contained or incorporated by reference in this prospectus is accurate as of any date other than the date of the document containing the information.
Rather than repeat certain information in this prospectus that we have already included in reports filed with the SEC, this prospectus
incorporates important business and financial information about us that is not included in or delivered with this prospectus. We will provide this information to you at no charge upon written or oral request directed to: The Timken Company, 4500 Mt.
Pleasant St. N.W., North Canton, Ohio 44720, Telephone: (234) 262-7446, Attention: DirectorCapital Markets & Investor Relations. In order to receive timely delivery of any requested documents in advance of the Expiration Date,
you should make your request no later than , 2015, which is five full business days before you must make a decision regarding the Exchange Offer.
TABLE OF CONTENTS
This prospectus may only be used where it is legal to make the Exchange Offer and by a broker-dealer for
resales of Exchange Notes acquired in the Exchange Offer where it is legal to do so.
This prospectus and the information incorporated by
reference summarize documents and other information in a manner we believe to be accurate, but we refer you to the actual documents for a more complete understanding of the information we discuss in this prospectus and the information incorporated
by reference. In making an investment decision, you must rely on your own examination of such documents, our business and the terms of the offering and the Exchange Notes, including the merits and risks involved.
We make no representation to you that the Exchange Notes are a legal investment for you. You should not consider any information in this
prospectus to be legal, business or tax advice. You should consult your own attorney, business advisor and tax advisor for legal, business and tax advice regarding an investment in the Exchange Notes. Neither the delivery of the prospectus nor any
exchange made pursuant to this prospectus implies that any information set forth in or incorporated by reference in this prospectus is correct as of any date after the date of this prospectus.
Each broker-dealer that receives Exchange Notes for its own account pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of Exchange Notes. The letter of transmittal accompanying this prospectus states that by so acknowledging and by delivering a prospectus, a broker dealer will not be deemed to admit that it is an
underwriter within the meaning of the Securities Act. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of Exchange Notes received in exchange for Original
Notes where the Original Notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. We have agreed that, for a period ending on the earlier of (i) 180 days from the date on which the
registration statement of which this prospectus forms a part is declared effective and (ii) the date on which a broker-dealer is no longer required to deliver a prospectus in connection with market-making or other trading activities, we will
make this prospectus available to any broker-dealer for use in connection with these resales. See Plan of Distribution.
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MARKET AND INDUSTRY DATA
Market data included or incorporated by reference in this prospectus is based on managements knowledge of the industry and the good
faith estimates of management. We also relied, to the extent available, upon managements review of independent industry surveys and publications and other publicly available information prepared by a number of sources. This data involves a
number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. Although we believe that these sources are reliable, we cannot guarantee the accuracy or completeness of this information, and we have not
independently verified this information.
DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements set forth in this prospectus (including our forecasts, beliefs and expectations) that are not historical in nature are
forward-looking statements within the meaning of the federal securities laws. Forward-looking statements generally will be accompanied by words such as anticipate, believe, could, estimate,
expect, forecast, outlook, intend, may, possible, potential, predict, project or other similar words, phrases or expressions. You are
cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this prospectus. We caution readers that actual results may differ materially from those expressed or implied in forward-looking statements made
by or on our behalf due to a variety of factors, such as:
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deterioration in world economic conditions, or in economic conditions in any of the geographic regions in we conduct business, including additional adverse effects from the global economic slowdown, terrorism or
hostilities. This includes: political risks associated with the potential instability of governments and legal systems in countries in which we or our customers conduct business, and changes in currency valuations; |
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the effects of fluctuations in customer demand on sales, product mix and prices in the industries in which we operate. This includes: our ability to respond to rapid changes in customer demand, the effects of customer
bankruptcies or liquidations, the impact of changes in industrial business cycles, and whether conditions of fair trade continue in the U.S. markets; |
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competitive factors, including changes in market penetration, increasing price competition by existing or new foreign and domestic competitors, the introduction of new products by existing and new competitors, and new
technology that may impact the way our products are sold or distributed; |
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changes in operating costs. This includes: the effect of changes in our manufacturing processes; changes in costs associated with varying levels of operations and manufacturing capacity; availability and cost of raw
materials and energy; changes in the expected costs associated with product warranty claims; changes resulting from inventory management and cost reduction initiatives and different levels of customer demands; the effects of unplanned plant
shutdowns; and changes in the cost of labor and benefits; |
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the success of our operating plans, announced programs, initiatives and capital investments; the ability to integrate acquired companies; the ability of acquired companies to achieve satisfactory operating results,
including results being accretive to earnings; and our ability to maintain appropriate relations with unions that represent our associates in certain locations in order to avoid disruptions of business; |
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unanticipated litigation, claims or assessments. This includes: claims or problems related to intellectual property, product liability or warranty, environmental issues, and taxes; |
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changes in worldwide financial markets, including availability of financing and interest rates, which affect: our cost of funds and/or ability to raise capital; and customer demand and the ability of customers to obtain
financing to purchase our products or equipment that contain our products; |
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the impact on our pension obligations due to changes in interest rates, investment performance and other tactics designed to reduce risk; |
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retention of U.S. Continued Dumping and Subsidy Offset Act distributions; |
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our ability to realize the potential benefits of the spinoff of TimkenSteel Corporation, or TimkenSteel, and avoid possible indemnification liabilities entered into with TimkenSteel in connection with the spinoff;
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the taxable nature of the spinoff of TimkenSteel; and |
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the risk factors referred to or described in the Risk Factors section of this prospectus and the other risk factors described under Item 1A, Risk Factors in our annual report on Form 10-K
for the year ended December 31, 2014. |
Additional risks relating to our business, the industries in which we operate or
the Notes may be described from time to time in our filings with the SEC. All of these risk factors are difficult to predict, are subject to material uncertainties that may affect actual results and may be beyond our control.
Readers are cautioned that it is not possible to predict or identify all of the risks, uncertainties and other factors that may affect future
results and that the above list should not be considered to be a complete list. Except as required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new
information, future events or otherwise.
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SUMMARY
This summary highlights significant aspects of our business and this exchange offer, but it is not complete and may not contain all of the
information that may be important to you. For a more complete understanding of our company, we encourage you to read this entire prospectus carefully, including the information incorporated by reference herein and the other documents to which we
have referred. In particular, we encourage you to read the historical financial statements and related notes incorporated by reference in this prospectus. Investing in the Notes involves significant risks, as described in the Risk
Factors section.
In this prospectus, unless otherwise indicated or the context otherwise requires, references to the terms
the Company, Timken, we, our, us or similar terms mean The Timken Company and its direct and indirect subsidiaries. Unless otherwise indicated or the context otherwise requires, all
references in this prospectus to Notes mean collectively the Original Notes and the Exchange Notes. All financial data presented in this prospectus is the financial data of Timken and its consolidated subsidiaries unless otherwise
indicated.
Our Company
The Timken Company engineers, manufactures and markets bearings, transmissions, gearboxes, chain and related products, and offers a spectrum
of power system rebuild and repair services around the world. Our growing product and services portfolio features many strong industrial brands, such as Timken, Fafnir, Philadelphia Gear, Drives and Interlube. Today, we apply our deep knowledge of
metallurgy, tribology and power transmission across the broad spectrum of bearings and related systems to improve the reliability and efficiency of machinery and equipment all around the world. Known for our quality products and collaborative
technical sales model, we focus on providing value to diverse markets worldwide through both original equipment manufacturers, or OEMs, and aftermarket channels. With approximately 16,000 people operating in 28 countries, we make the world more
productive and keep industry in motion. Beginning in the fourth quarter of 2014, we began operating under two segments: (1) Mobile Industries and (2) Process Industries. The following further describes these business segments:
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Mobile Industries offers an extensive portfolio of bearings, seals, lubrication devices and systems, as well as power transmission components, engineered chain, augers and related products and maintenance
services, to OEMs of: off-highway equipment for the agricultural, construction and mining markets; on-highway vehicles, including passenger cars, light trucks, and medium- and heavy-duty trucks; and rail cars, locomotives, rotor craft and fixed-wing
aircraft. Beyond service parts sold to OEMs, aftermarket sales to individual end users, equipment owners, operators and maintenance shops are handled through our extensive network of authorized automotive and heavy-truck distributors, and include
hub units, specialty kits and more. Mobile Industries also provides power transmission systems and flight-critical components for civil and military aircraft, which include bearings, helicopter transmission systems, rotor-head assemblies, turbine
engine components, gears and housings. |
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Process Industries supplies industrial bearings and assemblies, power transmission components, such as gears and gearboxes, couplings, seals, lubricants, chains and related products and services to OEMs and end
users in industries that place heavy demands on operating equipment they make or use. This includes: metals, mining, cement and aggregate production; coal and wind power generation; oil and gas; pulp and paper in applications, including printing
presses; and cranes, hoists, drawbridges, wind energy turbines, gear drives, drilling equipment, coal conveyors, health and critical motion control equipment, marine equipment and food processing equipment. This segment also supports aftermarket
sales and service needs through its global network of authorized industrial distributors. In addition, our industrial services group offers end users a broad portfolio of maintenance support and capabilities that include repair and service for
bearings and gearboxes as well as electric motor rewind, repair and services. |
1
For nearly 100 years, we also made and marketed steel within our steel business. However, on
June 30, 2014, we announced that we had completed the tax-free spinoff of our steel business into a separate independent publicly traded company, TimkenSteel. Our Board of Directors declared a distribution of all outstanding common shares of
TimkenSteel through a dividend. At the close of business on June 30, 2014, our shareholders received one common share of TimkenSteel for every two common shares of Timken that they held as of the close of business on June 23, 2014. The
steel business has been reclassified to discontinued operations for all periods presented in this prospectus.
Our Strategy
We focus our strategy on creating value that leads to growth and sustained levels of profitability. We work to create value by:
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Expanding in new and existing markets by applying our knowledge of metallurgy, friction management and mechanical power transmission to create value for our customers. Using a highly collaborative technical selling
model, we place particular emphasis on creating unique solutions for challenging and/or demanding applications. We intend to grow in attractive market sectors, emphasizing those spaces that are highly fragmented, demand high service and value the
reliability and efficiency offered by our products. We also target those applications that offer significant aftermarket demand, thereby providing product and services revenue throughout the equipments lifetime. |
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Performing with excellence, driving for exceptional results with a passion for superior execution. We embrace a continuous improvement culture that is charged with lowering costs, eliminating waste, increasing
efficiency, encouraging organizational agility and building greater brand equity. As part of this effort, we may also reposition underperforming product lines and segments and divest non-strategic assets. |
Corporate Information
We
were incorporated as an Ohio corporation in 1904. Our principal executive offices are located at 4500 Mount Pleasant St. N.W., North Canton, Ohio 44720. Our main telephone number is (234) 262-3000, and our Internet website address is
www.timken.com. We do not intend the information contained on or accessible through our website to be a part of this prospectus, other than the documents that we file with the SEC that are incorporated by reference in this prospectus.
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The Exchange Offer
The following summary contains basic information about the Exchange Offer. It does not contain all of the information that may be important
to you. For a more complete description of the terms of the Exchange Offer, see The Exchange Offer.
The Exchange Offer |
We are offering to exchange up to $350,000,000 aggregate principal amount of Exchange Notes for the Original Notes. The terms of the Exchange Notes are substantially identical to the terms of the Original Notes, except that the Exchange Notes
will be registered under the Securities Act, and the transfer restrictions and registration rights and related additional interest provisions applicable to the Original Notes will not apply to the Exchange Notes. Holders of Original Notes do not
have any appraisal or dissenters rights in connection with the Exchange Offer. |
Purposes of the Exchange Offer |
The Exchange Notes are being offered to satisfy our obligations under the registration rights agreement entered into at the time we issued and sold the Original Notes. |
Expiration date; withdrawal of tenders; return of Original Notes not accepted for exchange |
The Exchange Offer will expire at 5:00 p.m., New York City time, on , 2015, or on a later date and time to which we extend it. Tenders of Original Notes in the Exchange
Offer may be withdrawn at any time prior to 5:00 p.m., New York City time, on the Expiration Date. We will exchange the Exchange Notes for validly tendered Original Notes promptly following the Expiration Date. Any Original Notes that are not
accepted for exchange for any reason will be returned by us, at our expense, to the tendering holder promptly after the expiration or termination of the Exchange Offer. |
Procedures for tendering Original Notes |
Each holder of Original Notes wishing to participate in the Exchange Offer must follow procedures of The Depository Trust Companys, or DTC, Automated Tender Offer Program, or ATOP, subject to the terms and procedures of that program. The
ATOP procedures require that the exchange agent receives, prior to the Expiration Date, a computer-generated message known as an agents message that is transmitted through ATOP and that DTC confirm that: |
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DTC has received instructions to exchange your Original Notes; and |
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you agree to be bound by the terms of the letter of transmittal. |
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See The Exchange OfferProcedures for Tendering Original Notes. |
Consequences of failure to exchange Original Notes |
You will continue to hold Original Notes, which will remain subject to their existing transfer restrictions, if you do not validly tender your Original Notes or you tender your Original
Notes and they are not accepted for exchange. With some limited exceptions, we will have |
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no obligation to register the Original Notes after we consummate the Exchange Offer. See The Exchange OfferTerms of the Exchange Offer and The Exchange
OfferConsequences of Failure To Exchange. |
Conditions of the Exchange Offer |
The Exchange Offer is not conditioned upon any minimum aggregate principal amount of Original Notes being tendered or accepted for exchange. The Exchange Offer is subject to customary conditions, which may be waived by us in our discretion. We
currently expect that all of the conditions will be satisfied and that no waivers will be necessary. |
Exchange agent |
The Bank of New York Mellon Trust Company, N.A. |
United States federal income tax considerations |
Your exchange of an Original Note for an Exchange Note pursuant to the Exchange Offer will not constitute a taxable exchange. You will not recognize any taxable income, gain or loss in the exchange. Immediately after the exchange, you will have
the same adjusted tax basis and holding period in each Exchange Note received as you had immediately prior to the exchange in the corresponding Original Note surrendered. See United States Federal Income Tax Considerations.
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Resales |
Based on existing interpretations of the Securities Act by the SEC staff set forth in several no-action letters to third parties, and subject to the immediately following sentence, we believe the Exchange Notes may be offered for resale, resold
and otherwise transferred by the holders thereof (other than holders that are broker-dealers) without further compliance with the registration and prospectus delivery provisions of the Securities Act. However, any holder of Original Notes that is an
affiliate of ours or that intends to participate in the Exchange Offer for the purpose of distributing any of the Exchange Notes, or any broker-dealer that purchased any of the Original Notes from us for resale pursuant to Rule 144A or any other
available exemption under the Securities Act, (i) will not be able to rely on the interpretations of the SEC staff set forth in the above mentioned no-action letters, (ii) will not be entitled to tender its Original Notes in the Exchange Offer and
(iii) must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any sale or transfer of the Original Notes unless such sale or transfer is made pursuant to an exemption from such requirements.
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Any broker-dealer that will receive Exchange Notes for its own account in exchange for Original Notes that were acquired as a result of market-making activities or other trading activities must deliver a prospectus (or to the extent permitted by
law, make available a prospectus to purchasers) in connection with any resale of such Exchange Notes. |
Risk factors |
You should carefully read and consider the risk factors beginning on page 8 of this prospectus before deciding whether to participate in the Exchange Offer. |
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The Exchange Notes
The following is a brief summary of the principal terms of the Exchange Notes and is provided solely for your convenience. It is not
intended to be complete. You should read the full text and more specific details contained elsewhere in this prospectus. For a more detailed description of the Exchange Notes, see Description of Notes.
Issuer |
The Timken Company |
Notes offered |
Up to $350,000,000 aggregate principal amount of 3.875% senior notes due 2024. |
Maturity |
September 1, 2024. |
Interest rate |
The Exchange Notes will bear interest at 3.875% per year. |
Interest payment dates |
Interest on the Exchange Notes will be payable on March 1 and September 1 of each year. |
Ranking |
The Exchange Notes will be our senior unsecured obligations and will rank equally in right of payment with all of our existing and future senior unsecured indebtedness, including all other unsubordinated debt securities issued under the
indenture governing the Exchange Notes, which we refer to as the indenture, from time to time outstanding. The Exchange Notes will be senior in right of payment to any of our future subordinated indebtedness and structurally subordinate to all
existing and future obligations of our subsidiaries. The indenture does not restrict the issuance by us or our subsidiaries of senior unsecured indebtedness. See Description of Notes. |
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As of December 31, 2014, we had approximately: |
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$530.1 million of indebtedness outstanding, none of which was secured; and |
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$500.0 million of availability under our senior credit facility. |
Form and denomination |
The Exchange Notes will be issued in fully registered form in denominations of $2,000 or integral multiples of $1,000 in excess thereof. |
Additional Notes |
We may create and issue further notes ranking equally and ratably with the Notes in all respects so that such further notes will be consolidated and form a single series with the Notes and will have the same terms as to status, redemption or
otherwise. |
Optional redemption |
Prior to June 1, 2024, we have the option to redeem some or all of the Notes at any time and from time to time at a redemption price that includes a make-whole premium, as described
under the section entitled Description of NotesOptional Redemption. At any time |
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on or after June 1, 2024 (three months prior to their maturity date), we have the option to redeem some or all of the Notes at any time and from time to time at a redemption price equal to
100% of their principal amount, plus accrued and unpaid interest, if any. See Description of NotesOptional Redemption. |
Offer to repurchase upon change of control triggering event |
If we experience a Change of Control Triggering Event (as defined herein), we will be required, unless we have exercised our option to redeem the Exchange Notes, to offer to purchase the Exchange Notes at a purchase price equal to 101% of their
principal amount, plus accrued and unpaid interest, if any, to, but excluding, the date of purchase. See Description of NotesChange of Control Triggering Event. |
Use of Proceeds |
We will not receive any proceeds from the issuance of the Exchange Notes pursuant to the Exchange Offer. |
No Listing of Notes |
We do not intend to apply to list the Exchange Notes on any securities exchange or to have the Exchange Notes quoted on any automated quotation system. |
Absence of Established Market for the Notes |
The Exchange Notes will be a new class of securities for which there is currently no market, and we cannot assure you that a liquid market for the Exchange Notes will develop or be maintained. |
Trustee |
The Bank of New York Mellon Trust Company, N.A. |
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Summary Historical Consolidated Financial Information
The following table presents our summary historical consolidated financial information as of and for each of the fiscal years ended
December 31, 2014, 2013 and 2012. The summary historical consolidated financial information as of and for each of the fiscal years ended December 31, 2014, 2013 and 2012 have been derived from our audited consolidated financial statements
and should be read together with those audited consolidated financial statements and related notes and Managements Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K
for the fiscal year ended December 31, 2014, which is incorporated by reference in this prospectus.
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For the year ended December 31, |
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(dollars in millions) |
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2014 |
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2013 |
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2012 |
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Income statement data |
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Net sales |
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$ |
3,076.2 |
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$ |
3,035.4 |
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$ |
3,359.5 |
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Cost of product sold |
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2,178.2 |
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2,167.0 |
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2,331.5 |
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Gross profit |
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898.0 |
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868.4 |
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1,028.0 |
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Selling, general and administrative expenses |
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542.5 |
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546.6 |
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554.5 |
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Impairment and restructuring charges |
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113.4 |
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8.7 |
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29.5 |
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Pension settlement charges |
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33.7 |
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7.2 |
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Operating income |
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208.4 |
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305.9 |
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444.0 |
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Interest expense |
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(28.7 |
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(24.4 |
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(31.1 |
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Interest income |
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4.4 |
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1.9 |
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2.9 |
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Gain on sale of real estate |
|
|
22.6 |
|
|
|
5.4 |
|
|
|
|
|
Continued Dumping and Subsidy Offset Act (expenses) receipts, net |
|
|
(2.3 |
) |
|
|
(2.8 |
) |
|
|
108.0 |
|
Other (expense) income, net |
|
|
(0.4 |
) |
|
|
4.1 |
|
|
|
(6.0 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing operations before income taxes |
|
|
204.0 |
|
|
|
290.1 |
|
|
|
517.8 |
|
Provision for income taxes |
|
|
54.7 |
|
|
|
114.6 |
|
|
|
186.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from discontinued operations, net of income taxes |
|
|
24.0 |
|
|
|
87.5 |
|
|
|
164.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
173.3 |
|
|
|
263.0 |
|
|
|
495.9 |
|
Less: Net income attributable to noncontrolling interest |
|
|
2.5 |
|
|
|
0.3 |
|
|
|
0.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to Timken |
|
$ |
170.8 |
|
|
$ |
262.7 |
|
|
$ |
495.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet data (at period end) |
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
278.8 |
|
|
$ |
384.6 |
|
|
$ |
586.4 |
|
Working capital |
|
|
948.1 |
|
|
|
957.4 |
|
|
|
1,494.4 |
|
Total assets |
|
|
3,001.4 |
|
|
|
4,477.9 |
|
|
|
4,244.2 |
|
Total debt: |
|
|
|
|
|
|
|
|
|
|
|
|
Short-term debt |
|
|
7.4 |
|
|
|
18.6 |
|
|
|
14.3 |
|
Current portion of long-term debt |
|
|
0.6 |
|
|
|
250.7 |
|
|
|
9.6 |
|
Long-term debt |
|
|
522.1 |
|
|
|
176.4 |
|
|
|
424.9 |
|
Total debt |
|
|
530.1 |
|
|
|
445.7 |
|
|
|
448.8 |
|
Total liabilities |
|
|
1,412.3 |
|
|
|
1,829.3 |
|
|
|
1,997.6 |
|
Shareholders equity |
|
$ |
1,589.1 |
|
|
$ |
2,648.6 |
|
|
$ |
2,246.6 |
|
7
RISK FACTORS
An investment in the Exchange Notes involves risk. Prior to making a decision about investing in our securities, you should carefully
consider the following risk factors, as well as the risk factors discussed in our annual report on Form 10-K for the fiscal year ended December 31, 2014, which are incorporated herein by reference. You should also refer to the other information
in this prospectus, including our financial statements and the related notes incorporated by reference in this prospectus. Additional risks and uncertainties that are not yet identified may also materially harm our business, operating results and
financial condition.
Risks Relating to the Notes
The Notes are subject to prior claims of any secured creditors and the creditors of our subsidiaries, and if a default occurs we may not have sufficient
funds to fulfill our obligations under the Notes.
The Notes are our unsecured general obligations, ranking equally with our other
senior unsecured indebtedness and liabilities but below any secured indebtedness and effectively below the debt and other liabilities of our subsidiaries. The indenture permits us and our subsidiaries to incur secured debt under specified
circumstances. If we incur any secured debt, our assets and the assets of our subsidiaries will be subject to prior claims by our secured creditors. In the event of our bankruptcy, liquidation, reorganization or other winding up, assets that secure
debt will be available to pay obligations on the Notes only after all debt secured by those assets has been repaid in full. Holders of the Notes will participate in our remaining assets ratably with all of our unsecured and unsubordinated creditors,
including our trade creditors.
If we incur any additional obligations that rank equally with the Notes, including trade payables, the
holders of those obligations will be entitled to share ratably with the holders of the Notes in any proceeds distributed upon our insolvency, liquidation, reorganization, dissolution or other winding up. This may have the effect of reducing the
amount of proceeds paid to you. If there are not sufficient assets remaining to pay all of these creditors, all or a portion of the Notes then outstanding would remain unpaid.
The indenture does not limit the amount of indebtedness that we and our subsidiaries may incur.
The indenture does not limit the amount of indebtedness that we and our subsidiaries may incur. The indenture does not contain any financial
covenants or other provisions that would afford the holders of the Notes any substantial protection in the event we participate in a highly leveraged transaction.
Our existing and future indebtedness may limit cash flow available to invest in the ongoing needs of our business, which could prevent us from fulfilling
our obligations under the Notes.
Our total indebtedness at December 31, 2014 was approximately $530.1 million. Additionally, we
have the ability under our existing credit facilities to incur substantial additional indebtedness in the future. Our level of indebtedness could have important consequences to you. For example, it could:
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require us to dedicate a substantial portion of our cash flow from operations to the payment of debt service, reducing the availability of our cash flow to fund working capital, capital expenditures, acquisitions and
other general corporate purposes; |
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increase our vulnerability to adverse economic or industry conditions; |
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limit our ability to obtain additional financing in the future to enable us to react to changes in our business; or |
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place us at a competitive disadvantage compared to businesses in our industry that have less indebtedness. |
8
Additionally, any failure to comply with covenants in the instruments governing our debt could
result in an event of default which, if not cured or waived, would have a material adverse effect on us.
To service our indebtedness, we will require
a significant amount of cash. Our ability to generate cash depends on many factors beyond our control. We also depend on the business of our subsidiaries to satisfy our cash needs. If we cannot generate the required cash, we may not be able to make
the necessary payments under the Notes.
Our ability to make payments on our indebtedness, including the Notes, and to fund planned
capital expenditures will depend on our ability to generate cash in the future. Our ability to generate cash, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our
control.
A significant portion of our operations are conducted through our subsidiaries. As a result, our ability to service our debts,
including our obligations under the Notes and other obligations, is dependent to some extent on the earnings of our subsidiaries and the payment of those earnings to us in the form of dividends, loans or advances and through repayment of loans or
advances from us. At December 31, 2014, our subsidiaries collectively had approximately $7.4 million of third-party indebtedness outstanding. Our subsidiaries are separate and distinct legal entities. Our subsidiaries have no obligation to pay
any amounts due on the Notes or to provide us with funds to meet our payment obligations on the Notes, whether in the form of dividends, distributions, loans or other payments. In addition, any payment of dividends, loans or advances by our
subsidiaries could be subject to statutory or contractual restrictions. Payments to us by our subsidiaries will also be contingent upon our subsidiaries earnings and business considerations. Our right to receive any assets of any of our
subsidiaries upon their liquidation or reorganization, and therefore the right of the holders of the Notes to participate in those assets, will be effectively subordinated to the claims of that subsidiarys creditors, including trade creditors.
In addition, even if we are a creditor of any of our subsidiaries, our rights as a creditor would be subordinate to any security interest in the assets of our subsidiaries and any indebtedness of our subsidiaries senior to that held by us. Finally,
changes in the laws of foreign jurisdictions in which we operate may adversely affect the ability of some of our foreign subsidiaries to repatriate funds to us.
Additionally, our historical financial results have been, and we anticipate that our future financial results will be, subject to
fluctuations. We cannot assure you that our business will generate sufficient cash flow from our operations or that future borrowings will be available to us in an amount sufficient to enable us to pay our indebtedness, including the Notes, or to
fund our other liquidity needs and make necessary capital expenditures.
An active trading market for the Exchange Notes may not develop.
There is no existing market for the Exchange Notes and we do not intend to apply for listing of the Exchange Notes on any securities exchange
or any automated quotation system. Accordingly, there can be no assurance that a trading market for the Exchange Notes will ever develop or will be maintained. Further, there can be no assurance as to the liquidity of any market that may develop for
the Exchange Notes, your ability to sell your Exchange Notes or the price at which you will be able to sell your Exchange Notes. Future trading prices of the Exchange Notes will depend on many factors, including prevailing interest rates, our
financial condition and results of operations, the then-current ratings assigned to the Exchange Notes and the market for similar securities. Any trading market that develops would be affected by many factors independent of and in addition to the
foregoing, including:
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the time remaining to the maturity of the Exchange Notes; |
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the outstanding amount of the Exchange Notes; |
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|
the terms related to optional redemption of the Exchange Notes; and |
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|
the level, direction and volatility of market interest rates generally. |
9
We may not be able to satisfy our obligations to holders of the Notes upon a Change of Control Triggering
Event.
Upon the occurrence of a Change of Control Triggering Event, as defined in the indenture, we will be required to offer to
purchase the Notes at a price equal to 101% of the principal amount of such Notes, together with any accrued and unpaid interest, to, but excluding, the date of purchase. See Description of NotesChange of Control Triggering Event.
Our ability to repurchase Notes pursuant to a Change of Control Offer may be limited by a number of factors. The occurrence of certain of
the events that constitute a Change of Control would constitute a default under our senior credit facility. In addition, certain events that may constitute a change of control under our senior credit facility and cause a default under that agreement
will not constitute a Change of Control, as defined in the indenture, or a Change of Control Triggering Event under the indenture. Our future indebtedness or that of our subsidiaries may also contain prohibitions of certain events that would
constitute a Change of Control or require such indebtedness to be repurchased upon a Change of Control or a Change of Control Triggering Event. Moreover, the exercise by the holders of Notes of their right to require us to repurchase the Notes
following a Change of Control in connection with a Change of Control Triggering Event could cause a default under the Notes, even if the Change of Control itself does not, due to the financial effect of such repurchase on us. Finally, our ability to
pay cash to the holders upon a repurchase may be limited by our then existing financial resources. There can be no assurance that sufficient funds will be available when necessary to make any required repurchases.
The definition of Change of Control includes a phrase relating to the direct or indirect sale, lease, transfer, conveyance or other
disposition of all or substantially all of our assets and those of our subsidiaries taken as a whole. Although there is a limited body of case law interpreting the phrase substantially all, there is no precise established
definition of this phrase under applicable law. Accordingly, the ability of a holder of Exchange Notes to require us to purchase such holders Notes as a result of a sale, lease, transfer conveyance or other disposition of less than all of our
assets and those of our subsidiaries taken as a whole to another person may be uncertain.
Holders will not be entitled to
require us to purchase their Notes in the event of a takeover, recapitalization, leveraged buyout or similar transaction that is not a Change of Control. We may nonetheless incur significant additional indebtedness in connection with such a
transaction. Holders may not be able to require us to purchase their Notes in certain circumstances involving a significant change in the composition of our board of directors, including a proxy contest where our board of directors does not endorse
the dissident slate of directors but approves them as Continuing Directors, as defined in the indenture.
Holders of Notes may not be able to determine
when a change of control giving rise to their right to have the Notes repurchased by us has occurred following a sale of substantially all of our assets.
A Change of Control may require us to make an offer to repurchase all outstanding Notes (See Description of NotesChange
of Control Triggering Event). The definition of change of control includes a phrase relating to the sale of all or substantially all of our assets. There is no precise established definition of the phrase substantially
all under applicable law. Accordingly, the ability of a holder of Notes to require us to repurchase its Notes as a result of a sale of less than all of our assets to another individual, group or entity may be uncertain.
Our credit ratings may not reflect all risks of your investment in the Notes.
The credit ratings assigned to the Notes are limited in scope and do not address all material risks relating to an investment in the Notes but
rather reflect only the view of each rating agency at the time the rating is issued. The credit rating agencies also evaluate our industry and may change their credit rating for us based on their overall view of our industry. There can be no
assurance that the credit ratings assigned to the Notes will remain in effect for any given period of time or that a rating will not be lowered, suspended or withdrawn entirely by the applicable rating agency if, in such rating agencys
judgment, circumstances so warrant. Credit ratings are not a
10
recommendation to buy, sell or hold any security. Each agencys rating should be evaluated independently of any other agencys rating. Actual or anticipated changes or downgrades in our
credit ratings, including any announcement that our ratings are under further review for a downgrade, could affect the market value of the Notes and increase our corporate borrowing costs.
Redemption may adversely affect your return on the Notes.
We have the right to redeem some or all of the Notes prior to maturity. We may redeem the Notes at times when prevailing interest rates may be
relatively low. Accordingly, you may not be able to reinvest the amount received upon a redemption in a comparable security at an effective interest rate as high as that of the Notes.
Risks Related to the Exchange Offer
The consummation
of the Exchange Offer may not occur.
We will exchange up to the aggregate principal amount of Exchange Notes for Original Notes that
are tendered in compliance with, and pursuant to, the terms and conditions of the Exchange Offer described in this prospectus. Accordingly, holders participating in the Exchange Offer may have to wait longer than expected to receive their Exchange
Notes, during which time those holders of Original Notes will not be able to effect transfers of their Original Notes tendered in the Exchange Offer. We may, however, waive these conditions at our sole discretion prior to the expiration date. See
The Exchange OfferConditions to the Exchange Offer.
You may have difficulty selling the Original Notes that you do not exchange.
If you do not exchange your Original Notes for Exchange Notes pursuant to the Exchange Offer, the Original Notes you hold will
continue to be subject to the existing transfer restrictions. The Original Notes may not be offered, sold or otherwise transferred, except in compliance with the registration requirements of the Securities Act, pursuant to an exemption from
registration under the Securities Act or in a transaction not subject to the registration requirements of the Securities Act, and in compliance with applicable state securities laws. We do not anticipate that we will register the Original Notes
under the Securities Act. After the Exchange Offer is consummated, the trading market for the remaining untendered Original Notes may be small and inactive. Consequently, you may find it difficult to sell any Original Notes you continue to hold or
to sell such Original Notes at the price you desire because there will be fewer Original Notes outstanding. In addition, if you are eligible to exchange your Original Notes in the Exchange Offer and do not exchange your Original Notes in the
Exchange Offer, you will no longer be entitled to have those outstanding Original Notes registered under the Securities Act.
Some noteholders may be
required to comply with the registration and prospectus delivery requirements of the Securities Act.
If you exchange your Original
Notes in the Exchange Offer for the purpose of participating in a distribution of the Exchange Notes, you may be deemed to have received restricted securities and, if so, you will be required to comply with the registration and prospectus delivery
requirements of the Securities Act in connection with any resale transaction. In addition, any holder of Original Notes that is an affiliate of ours or a broker-dealer that purchased Original Notes for its own account as part of market-making
activities or other trading activities must deliver a prospectus when it sells the Exchange Notes it receives in exchange for Original Notes in the Exchange Offer. Our obligation to keep the registration statement of which this prospectus forms a
part effective is limited. Accordingly, we cannot guarantee that a current prospectus will be available at all times to broker-dealers wishing to resell their Exchange Notes.
11
USE OF PROCEEDS
The Exchange Offer is intended to satisfy our obligations under the registration rights agreement relating to the Original Notes. We will not
receive any cash proceeds from the issuance of the Exchange Notes. The terms of the Exchange Notes are substantially identical to the terms of the Original Notes, except that the Exchange Notes will be registered under the Securities Act, and the
transfer restrictions and registration rights and related additional interest provisions applicable to the Original Notes will not apply to the Exchange Notes. In consideration for issuing the Exchange Notes as contemplated in this prospectus, we
will receive, in exchange, an equal principal amount of the Original Notes. The Original Notes surrendered in exchange for the Exchange Notes will be retired and cannot be reissued.
12
RATIO OF EARNINGS TO FIXED CHARGES
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years Ended December 31, |
|
|
|
2014 |
|
|
2013 |
|
|
2012 |
|
|
2011 |
|
|
2010 |
|
Ratio of Earnings to Fixed Charges |
|
|
6.69x |
|
|
|
7.11x |
|
|
|
12.64x |
|
|
|
10.70x |
|
|
|
6.95x |
|
Fixed charges represent interest expense, capitalized interest and the portion of rental expense representing the
interest factor for continuing operations. Earnings represent the aggregate of income from continuing operations before extraordinary items (excluding undistributed earnings of unconsolidated entities), income taxes, net adjustments for
capitalized interest and fixed charges deducted from earnings.
13
THE EXCHANGE OFFER
Purpose of the Exchange Offer
In
connection with the offer and sale of the Original Notes, we entered into a registration rights agreement with the initial purchasers of the Original Notes. We are making the Exchange Offer to satisfy our obligations under the registration rights
agreement.
Terms of the Exchange Offer
We are offering to exchange, upon the terms and subject to the conditions set forth in this prospectus and in the accompanying letter of
transmittal, Exchange Notes for an equal principal amount of Original Notes. The terms of the Exchange Notes are substantially identical to the terms of the Original Notes, except that the Exchange Notes will be registered under the Securities Act
and the transfer restrictions and registration rights and related additional interest provisions applicable to the Original Notes will not apply to the Exchange Notes. The Exchange Notes will be of the same class as the Original Notes. The Exchange
Notes will be entitled to the benefits of the indenture. See Description of Notes.
The Exchange Offer is not conditioned upon
any minimum aggregate principal amount of Original Notes being tendered or accepted for exchange. As of the date of this prospectus, $350,000,000 aggregate principal amount of Original Notes was outstanding. Original Notes tendered in the Exchange
Offer must be in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof.
Based on certain interpretive
letters issued by the staff of the SEC to third parties in unrelated transactions, holders of Original Notes, except any holder who is an affiliate of ours within the meaning of Rule 405 under the Securities Act or any broker-dealer who
acquired the Original Notes directly from us, who exchange their Original Notes for Exchange Notes pursuant to the Exchange Offer generally may offer the Exchange Notes for resale, resell the Exchange Notes and otherwise transfer the Exchange Notes
without compliance with the registration and prospectus delivery provisions of the Securities Act, provided that the Exchange Notes are acquired in the ordinary course of the holders business and such holders are not participating in, and have
no arrangement or understanding with any person to participate in, a distribution of the Exchange Notes.
Each broker-dealer that receives
Exchange Notes for its own account in exchange for Original Notes, where the Original Notes were acquired by the broker-dealer as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus in
connection with any resale of the Exchange Notes as described in Plan of Distribution. In addition, to comply with the securities laws of individual jurisdictions, if applicable, the Exchange Notes may not be offered or sold unless they
have been registered or qualified for sale in the jurisdiction or an exemption from registration or qualification is available and complied with. We have agreed, pursuant to the registration rights agreement, to file with the SEC a registration
statement (of which this prospectus forms a part) with respect to the Exchange Notes. If you do not exchange Original Notes for Exchange Notes pursuant to the Exchange Offer, your Original Notes will continue to be subject to restrictions on
transfer.
If any holder of the Original Notes is an affiliate of ours, is engaged in or intends to engage in or has any arrangement or
understanding with any person to participate in the distribution of the Exchange Notes to be acquired in the Exchange Offer, the holder would not be able to rely on the applicable interpretations of the SEC and would be required to comply with the
registration requirements of the Securities Act, except for resales made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws.
Expiration Date; Extensions; Termination; Amendments
The Exchange Offer expires on the Expiration Date, which is 5:00 p.m., New York City time, on
, 2015 unless we, in our sole discretion, extend the period during which the Exchange Offer is open.
14
We reserve the right to extend the Exchange Offer at any time and from time to time prior to the
Expiration Date by giving written notice to The Bank of New York Mellon Trust Company, N.A., the exchange agent, and by public announcement communicated by no later than 5:00 p.m., New York City time, on the next business day following the
previously scheduled Expiration Date, unless otherwise required by applicable law or regulation, by making a release to PR Newswire or other wire service. During any extension of the Exchange Offer, all Original Notes previously tendered will remain
subject to the Exchange Offer and may be accepted for exchange by us.
The exchange date will promptly follow the Expiration Date. We
expressly reserve the right to:
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terminate the Exchange Offer and not accept for exchange any Original Notes for any reason, including if any of the events set forth under Conditions to the Exchange Offer shall have occurred and shall
not have been waived by us; and |
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|
amend the terms of the Exchange Offer in any manner, whether before or after any tender of the Original Notes. |
If any termination or material amendment occurs, we will notify the exchange agent in writing and will either issue a press release or give
written notice to the holders of the Original Notes as promptly as practicable. Additionally, in the event of a material amendment or change in the Exchange Offer, which would include any waiver of a material condition hereof, we will extend the
offer period, if necessary, so that at least five business days remain in the Exchange Offer following notice of the material amendment or change, as applicable.
Unless we terminate the Exchange Offer prior to 5:00 p.m., New York City time, on the Expiration Date, we will exchange the Exchange Notes for
the tendered Original Notes promptly after the Expiration Date, and will issue to the exchange agent Exchange Notes for Original Notes validly tendered, not withdrawn and accepted for exchange. Any Original Notes not accepted for exchange for any
reason will be returned without expense to the tendering holder promptly after expiration or termination of the Exchange Offer. See Acceptance of Original Notes for Exchange; Delivery of Exchange Notes.
This prospectus and the accompanying letter of transmittal and other relevant materials will be mailed by us to record holders of Original
Notes and will be furnished to brokers, banks and similar persons whose names, or the names of whose nominees, appear on the lists of holders for subsequent transmittal to beneficial owners of Original Notes.
Procedures for Tendering Original Notes
To participate in the Exchange Offer, you must properly tender your Original Notes to the exchange agent as described below. We will only issue
the Exchange Notes in exchange for the Original Notes that you timely and properly tender. Therefore, you should allow sufficient time to ensure timely delivery of the Original Notes, and you should follow carefully the instructions on how to tender
your Original Notes. It is your responsibility to properly tender your Original Notes. No letter of transmittal or other document should be sent to us. Beneficial owners may request their respective brokers, dealers, commercial banks, trust
companies or nominees to effect the above transactions for them.
If you have any questions or need help in exchanging your Original
Notes, please contact the exchange agent at the address or telephone numbers set forth below.
All of the Original Notes were issued in
book-entry form, and all of the Original Notes are currently represented by global certificates registered in the name of Cede & Co., the nominee of DTC. You may tender your Original Notes using ATOP. The exchange agent will make a request
to establish an account with respect to the Original Notes at DTC for purposes of the Exchange Offer within two business days after this prospectus is mailed to holders, and any financial institution that is a participant in DTC may make book-entry
delivery of Original Notes by causing DTC to transfer the Original Notes into the exchange agents account at DTC in accordance with DTCs procedures for transfer. In connection with the transfer, DTC will send an agents
15
message to the exchange agent. The agents message will state that DTC has received instructions from the participant to tender the Original Notes and that the participant agrees to be
bound by the terms of the letter of transmittal.
By using the ATOP procedures to exchange the Original Notes, you will not be required to
deliver a letter of transmittal to the exchange agent. However, you will be bound by its terms just as if you had signed it. The tender of Original Notes by you pursuant to the procedures set forth in this prospectus will constitute an agreement
between you and us in accordance with the terms and subject to the conditions set forth in this prospectus and in the letter of transmittal.
All questions as to the validity, form, eligibility, including time of receipt, and acceptance for exchange of any tender of Original Notes
will be determined by us and will be final and binding. We reserve the absolute right to reject any or all tenders not in proper form or the acceptances for exchange of which may, upon advice of our counsel, be unlawful. We also reserve the right to
waive any defect, irregularities or conditions of tender as to particular Original Notes. Our interpretation of the terms and conditions of the exchange offer, including the instructions in the letter of transmittal, will be final and binding on all
parties. Unless waived, all defects or irregularities in connection with tenders of the Original Notes must be cured within such time as we shall determine. Although we intend to notify holders of defects or irregularities with respect to tenders of
the Original Notes, neither we, the exchange agent nor any other person will incur any liability for failure to give such notification. Tenders of the Original Notes will not be deemed made until such defects or irregularities have been cured or
waived. Any Original Notes received by the exchange agent that are not properly tendered and as to which the defects or irregularities have not been cured or waived will be returned to the tendering holder as soon as practicable after the Expiration
Date of the Exchange Offer.
In all cases, we will issue the Exchange Notes for the Original Notes that we have accepted for exchange
under the Exchange Offer only after the exchange agent receives, prior to the Expiration Date, a book-entry confirmation of such number of the Original Notes into the exchange agents account at DTC and a properly transmitted agents
message.
If we do not accept any tendered Original Notes for exchange or if the Original Notes are submitted for a greater principal
amount than the holder desires to exchange, the unaccepted or non-exchanged Original Notes will be returned without expense to their tendering holder. Such non-exchanged Original Notes will be credited to an account maintained with DTC. These
actions will occur as promptly as practicable after the expiration or termination of the Exchange Offer.
Each broker-dealer that receives
the Exchange Notes for its own account in exchange for the Original Notes, where those Original Notes were acquired by such broker-dealer as a result of market-making activities or other trading activities, must acknowledge that it will deliver a
prospectus in connection with any resale of those Exchange Notes. See Plan of Distribution.
Terms and Conditions Contained in the Letter
of Transmittal
The accompanying letter of transmittal contains, among other things, the following terms and conditions, which are part
of the Exchange Offer.
The transferring party tendering Original Notes for exchange will be deemed to have exchanged, assigned and
transferred the Original Notes to us and irrevocably constituted and appointed the exchange agent as the transferors agent and attorney-in-fact to cause the Original Notes to be assigned, transferred and exchanged. The transferor will be
required to represent and warrant that it has full power and authority to tender, exchange, assign and transfer the Original Notes and to acquire Exchange Notes issuable upon the exchange of the tendered Original Notes and that, when the same are
accepted for exchange, we will acquire good and unencumbered title to the tendered Original Notes, free and clear of all liens, restrictions (other than restrictions on transfer), charges and encumbrances and that the tendered Original Notes are not
and will not be subject to any adverse claim. The
16
transferor will be required to also agree that it will, upon request, execute and deliver any additional documents deemed by the exchange agent or us to be necessary or desirable to complete the
exchange, assignment and transfer of tendered Original Notes. The transferor will be required to agree that acceptance of any tendered Original Notes by us and the issuance of Exchange Notes in exchange for tendered Original Notes will constitute
performance in full by us of our obligations under the registration rights agreement and that we will have no further obligations or liabilities under the registration rights agreement, except in certain limited circumstances. All authority
conferred by the transferor will survive the death, bankruptcy or incapacity of the transferor and every obligation of the transferor will be binding upon the heirs, legal representatives, successors, assigns, executors, administrators and trustees
in bankruptcy of the transferor.
Upon agreement to the terms of the letter of transmittal pursuant to an agents message, a holder,
or beneficial holder of the Original Notes on behalf of which the holder has tendered, will, subject to that holders ability to withdraw its tender, and subject to the terms and conditions of the Exchange Offer generally, thereby certify that:
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the Exchange Notes are being acquired in the ordinary course of business of the person receiving the Exchange Notes, whether or not the person is the registered holder; |
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at the time of the commencement of the Exchange Offer, it is not engaged in, and does not intend to engage in, and it has no arrangement or understanding with any person to participate in the distribution (within the
meaning of the Securities Act) of the Exchange Notes in violation of the provisions of the Securities Act; and |
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it is not an affiliate (within the meaning of Rule 405 under the Securities Act) of ours. |
Each broker-dealer that receives Exchange Notes for its own account in exchange for Original Notes where such Original Notes were acquired by
such broker-dealer as a result of market-making activities or other trading activities must acknowledge that it will deliver a prospectus in connection with any resale of such Exchange Notes. See Plan of Distribution.
Withdrawal Rights
Original Notes
tendered pursuant to the Exchange Offer may be withdrawn at any time prior to the close of business on the Expiration Date.
For a
withdrawal to be effective, a notice, telegram, facsimile transmission or letter of withdrawal must be received by the exchange agent at its address set forth in the accompanying letter of transmittal not later than 5:00 p.m., New York City time, on
the Expiration Date. Any notice of withdrawal must specify the name and number of the account at DTC to be credited with withdrawn Original Notes and otherwise comply with the ATOP procedures. The exchange agent will return properly withdrawn
Original Notes promptly following receipt of notice of withdrawal. Properly withdrawn Original Notes may be retendered by following the procedures described under Procedures for Tendering Original Notes at any time on or prior to
5:00 p.m., New York City time, on the Expiration Date. All questions as to the validity of notices of withdrawals, including time of receipt, will be determined by us, and will be final and binding on all parties.
Acceptance of Original Notes for Exchange; Delivery of Exchange Notes
Upon the terms and subject to the conditions of the Exchange Offer, the acceptance for exchange of Original Notes validly tendered and not
validly withdrawn and the issuance of the Exchange Notes will be made as soon as practicable after the Expiration Date. For purposes of the Exchange Offer, we will be deemed to have accepted for exchange validly tendered Original Notes when and if
we have given written notice to the exchange agent. The Original Notes surrendered in exchange for the Exchange Notes will be retired and cannot be reissued.
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The exchange agent will act as agent for the tendering holders of each series of Original Notes
for the purposes of receiving corresponding series of Exchange Notes from us and causing the Original Notes to be assigned, transferred and exchanged. Original Notes tendered by book-entry transfer into the exchange agents account at DTC
pursuant to the procedures described above will be credited to an account maintained by the holder with DTC for the Original Notes, promptly after withdrawal, rejection of tender or termination of the Exchange Offer.
Conditions to the Exchange Offer
The
Exchange Offer is not subject to any conditions, except that we are not required to conduct the Exchange Offer if (i) doing so would violate any applicable law or applicable interpretations of the SEC, (ii) any action or proceeding is
instituted in or threatened in any court or by or before any governmental agency with respect to the Exchange Offer that, in our reasonable judgment, might materially impair our ability to proceed with the Exchange Offer or (iii) any government
or regulatory approval to conduct the Exchange Offer has not been obtained that, in our reasonable judgment, is necessary for the consummation of the Exchange Offer.
These conditions are for our sole benefit and may be asserted by us with respect to all or any portion of the Exchange Offer regardless of the
circumstances, including any action or inaction by us, giving rise to the condition or may be waived by us in whole or in part at any time or from time to time in our sole discretion. The failure by us at any time to exercise any of the foregoing
rights will not be deemed a waiver of any right, and each right will be deemed an ongoing right that may be asserted at any time or from time to time. We reserve the right, notwithstanding the satisfaction of these conditions, to terminate or amend
the Exchange Offer.
Any determination by us concerning the fulfillment or non-fulfillment of any conditions will be final and binding
upon all parties.
In addition, we will not accept for exchange any Original Notes tendered, and no Exchange Notes will be issued in
exchange for any Original Notes, if at such time, any stop order has been issued or is threatened with respect to the registration statement of which this prospectus forms a part, or with respect to the qualification of the indenture under the Trust
Indenture Act of 1939, or the TIA.
Exchange Agent
The Bank of New York Mellon Trust Company, N.A., has been appointed as the exchange agent for the Exchange Offer. Questions relating to the
procedure for tendering, as well as requests for additional copies of this prospectus or the accompanying letter of transmittal, should be directed to the exchange agent addressed as follows:
The Bank of New York Mellon Trust Company, N.A.
111 Sanders Creek Parkway
East
Syracuse, New York 13057
E-mail: dacia.brown@bnymellon.com
Facsimile: (732) 667-9408
Attention: Corporate Trust Reorg
Originals of all documents sent by facsimile should be promptly sent to the exchange agent by mail, by hand or by overnight delivery service.
Solicitation of Tenders; Expenses
We have not retained any dealer-manager or similar agent in connection with the Exchange Offer and we will not make any payments to brokers,
dealers or others for soliciting acceptances of the Exchange Offer. We will, however, pay the exchange agent reasonable and customary fees for its services and will reimburse it for
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actual and reasonable out-of-pocket expenses. The expenses to be incurred in connection with the Exchange Offer, including the fees and expenses of the exchange agent and printing, accounting and
legal fees, will be paid by us.
No person has been authorized to give any information or to make any representations in connection with
the Exchange Offer other than those contained in this prospectus. If given or made, the information or representations should not be relied upon as having been authorized by us. Neither the delivery of this prospectus nor any exchange made in the
Exchange Offer will, under any circumstances, create any implication that there has been no change in our affairs since the date of this prospectus or any earlier date as of which information is given in this prospectus.
The Exchange Offer is not being made to, nor will tenders be accepted from or on behalf of, holders of Original Notes in any jurisdiction in
which the making of the Exchange Offer or the acceptance would not be in compliance with the laws of the jurisdiction. However, we may, at our discretion, take any action as we may deem necessary to make the Exchange Offer in any jurisdiction.
Appraisal or Dissenters Rights
Holders of Original Notes will not have appraisal or dissenters rights in connection with the Exchange Offer.
Transfer Taxes
If you tender your
Original Notes, you will not be obligated to pay any transfer taxes in connection with the Exchange Offer.
Income Tax Considerations
We advise you to consult your own tax advisers as to your particular circumstances and the effects of any state, local or foreign tax laws to
which you may be subject.
The discussion in this prospectus is based upon the provisions of the Internal Revenue Code of 1986, as
amended, or the Code, and regulations, rulings and judicial decisions thereunder, in each case as in effect on the date of this prospectus, all of which are subject to change.
The exchange of an Original Note for an Exchange Note will not constitute a taxable exchange. The exchange will not result in taxable income,
gain or loss being recognized by you or by us. Immediately after the exchange, you will have the same adjusted basis and holding period in each Exchange Note received as you had immediately prior to the exchange in the corresponding Original Note
surrendered. See United States Federal Income Tax Considerations for more information.
Consequences of Failure to Exchange
As a consequence of the offer or sale of the Original Notes pursuant to an exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act and applicable state securities laws, holders of Original Notes who do not exchange Original Notes for Exchange Notes in the Exchange Offer will continue to be subject to the restrictions on transfer of the
Original Notes. In general, the Original Notes may not be offered or sold unless such offers and sales are registered under the Securities Act, or are exempt from, or not subject to, the registration requirements of the Securities Act and applicable
state securities laws.
UPON COMPLETION OF THE EXCHANGE OFFER, DUE TO THE RESTRICTIONS ON TRANSFER OF THE ORIGINAL NOTES AND THE
ABSENCE OF SIMILAR RESTRICTIONS APPLICABLE TO THE EXCHANGE NOTES, IT IS HIGHLY LIKELY THAT THE MARKET, IF
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ANY, FOR ORIGINAL NOTES WILL BE LESS LIQUID THAN THE MARKET FOR EXCHANGE NOTES. CONSEQUENTLY, HOLDERS OF ORIGINAL NOTES WHO DO NOT PARTICIPATE IN THE EXCHANGE OFFER COULD EXPERIENCE SIGNIFICANT
DIMINUTION IN THE VALUE OF THEIR ORIGINAL NOTES COMPARED TO THE VALUE OF THE EXCHANGE NOTES.
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DESCRIPTION OF NOTES
The following description is only a summary of certain terms of the Notes and the indenture governing the Notes. We urge you to read the
indenture in its entirety because the indenture, and not this summary, defines your rights as a holder of the Notes. You may request a copy of the indenture from us. See Where You Can Find Additional Information. The following summary
does not purport to be complete and is subject to, and is qualified in its entirety by reference to, all of the provisions of the indenture and those terms made a part of the indenture by reference to the TIA as in effect on the date of this
prospectus. We provide our definitions for the capitalized terms in this section that we otherwise do not define at the end of the relevant subsection. For purposes of this section, references to we, us, our and
the Company refer to The Timken Company and not its subsidiaries. Additionally, we refer to the Exchange Notes and the Original Notes as the Notes. in this section. The Exchange Notes offered hereby and any Original Notes not
tendered pursuant to the terms hereof will be treated as a single class under the indenture, including for purposes of determining whether the required percentage of holders have given approval or consent to an amendment or waiver or joined in
directing the trustee to take certain actions on behalf of all holders.
General
The Original Notes were issued and the Exchange Notes will be issued under the indenture, dated as of August 20, 2014, between us and The
Bank of New York Mellon Trust Company, N.A., as trustee. The Notes will mature on September 1, 2024, subject to earlier redemption. The Exchange Notes will be issued in minimum denominations of $2,000 and integral multiples of $1,000 in excess
thereof. Interest on the Notes will accrue at a rate of 3.875% per year. Interest on the Notes will be payable semi-annually on March 1 and September 1 beginning on March 1, 2015, to the persons who are registered holders of the
Notes at the close of business on February 15 and August 15 of each year immediately preceding the respective interest payment dates, except that interest payable at maturity will be paid to the same persons to whom principal of the Notes
is payable.
Interest will be computed on the basis of a 360-day year consisting of twelve 30-day months. The interest period relating to
an interest payment date (including the maturity date) shall be the period from, and including, the most recent preceding interest payment date to, but excluding, the relevant interest payment date.
All payments on the Notes, including principal, premium, if any, and interest will be payable at the corporate trust office of the trustee, as
paying agent under the indenture as set forth in the indenture.
If any interest payment date, maturity date or redemption date of an
Exchange Note falls on a day that is not a business day, the required payment of principal and interest may be made on the next succeeding business day as if made on the date that the payment was due and no interest will accrue on that payment for
the period from and after that interest payment date, maturity date or redemption date as the case may be, to the date of that payment on the next succeeding business day. The term business day means, with respect to any Exchange Note,
any day other than a Saturday, a Sunday or a day on which banking institutions or trust companies in The City of New York, New York or Canton, Ohio are authorized by law to close.
We will issue up to $350,000,000 aggregate principal amount of the Exchange Notes in exchange for the Original Notes. The terms of the Notes
do not limit our ability to incur additional indebtedness. The terms of the Notes do not necessarily afford holders of Notes protection in the event of a highly leveraged transaction or other transaction involving us that may adversely affect
holders.
The Notes will not be subject to any sinking fund.
Ranking
The Notes are our unsecured
senior obligations and rank equally in right of payment with all our existing and future unsecured and unsubordinated indebtedness and will be senior to our future subordinated
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indebtedness. The Notes are exclusively our obligation and not the obligation of any of our subsidiaries. Our rights and the rights of any holder of the Notes (or other of our creditors) to
participate in the assets of any subsidiary upon that subsidiarys liquidation or recapitalization will be subject to the prior claims of the subsidiarys creditors, except to the extent that we may be a creditor with recognized claims
against the subsidiary. In addition, the Notes effectively rank junior in right of payment to any secured indebtedness which we may incur in the future to the extent of the assets securing that indebtedness.
Transfer and Exchange
A holder may
transfer or exchange Notes in accordance with the indenture. The registrar and the trustee may require a holder, among other things, to furnish appropriate endorsements and transfer documents in connection with a transfer of Notes. Holders will be
required to pay all taxes and fees due on transfer. We are not required to transfer or exchange any Note selected for redemption or tendered for repurchase. Also, we are not required to transfer or exchange any Note for a period of 15 days before a
selection of Notes to be redeemed or a record date for the payment of interest.
Optional Redemption
Prior to June 1, 2024, we may redeem the Notes at our option, in whole at any time or in part from time to time, at a redemption price
equal to the greater of (1) 100% of the principal amount of the Notes to be redeemed, and (2) as determined by the Quotation Agent, the sum of the present values of the remaining scheduled payments of principal and interest on the Notes to
be redeemed (not including any portion of those payments of interest accrued to the date of redemption) from the redemption date to the maturity date of the Notes being redeemed, in each case, discounted to the date of redemption on a semi-annual
basis (assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Treasury Rate plus 25 basis points, plus, in each case, accrued and unpaid interest on the Notes to, but excluding, the date of redemption.
At any time on or after June 1, 2024 (three months prior to their maturity date), we may redeem the Notes at our option, in whole or in
part at any time and from time to time, at our option at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest thereon to, but excluding, the date of redemption.
Adjusted Treasury Rate means, with respect to any date of redemption, the rate per annum equal to the semi-annual
equivalent yield to maturity of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for that date of redemption.
Comparable Treasury Issue means the United States Treasury security selected by the Quotation Agent that would be utilized,
at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the Notes.
Comparable Treasury Price means, with respect to any date of redemption, (1) the average of the Reference Treasury
Dealer Quotations for the date of redemption, after excluding the highest and lowest Reference Treasury Dealer Quotations, or (2) if the Quotation Agent obtains fewer than three Reference Treasury Dealer Quotations, the average of all such
Reference Treasury Dealer Quotations.
Quotation Agent means one of the Reference Treasury Dealers appointed by us.
Reference Treasury Dealer means (1) each of Morgan Stanley & Co. LLC and Deutsche Bank Securities Inc.
and their respective successors; provided, however, that if any of the foregoing shall cease to be a primary U.S. Government securities dealer in New York City (a Primary Treasury Dealer), we shall substitute another
Primary Treasury Dealer, and (2) any other Primary Treasury Dealer selected by us.
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Reference Treasury Dealer Quotations means, with respect to each Reference
Treasury Dealer and any date of redemption, the average, as determined by the Quotation Agent, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the
Quotation Agent by that Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding that date of redemption.
We will mail notice of any redemption at least 30 days, but not more than 60 days, before the date of redemption to each holder of the Notes
to be redeemed (or to the extent permitted or required by applicable DTC procedures or regulations with respect to global notes, send electronically). If less than all the Notes are to be redeemed at any time, the trustee will select Notes to be
redeemed on a pro rata basis (or, in the case of global notes, the Notes will be selected for redemption based on DTCs applicable procedures) or by any other method the trustee deems fair and appropriate, and the identification of the
particular Notes will be included in the notice to holders. Unless we default in payment of the redemption price, on and after the date of redemption, interest will cease to accrue on the Notes or portions thereof called for redemption.
Change of Control Triggering Event
Upon
the occurrence of a Change of Control Triggering Event, unless we have exercised our right to redeem the Notes as described under Optional Redemption, we will be required to offer to purchase from each holder of the Notes all or a
portion (equal to $2,000 and any integral multiples of $1,000 in excess thereof) of such holders Notes pursuant to the offer described below (the Change of Control Offer) at a purchase price equal to 101% of the principal amount
thereof plus accrued and unpaid interest, if any, to, but excluding, the date of purchase, subject to the rights of holders of the Notes on the relevant record date to receive interest due on the relevant interest payment date.
Within 30 days following the date upon which the Change of Control Triggering Event occurred, or at our option, prior to any Change of Control
but after the public announcement of the pending Change of Control, we will be required to send, by first class mail (or to the extent permitted or required by applicable DTC procedures or regulations with respect to global notes, send
electronically), a notice to each holder of the Notes, with a copy to the trustee, which notice will govern the terms of the Change of Control Offer. Such notice will state, among other things, the purchase date, which must be no earlier than 30
days and no later than 60 days from the date such notice is mailed or sent electronically, as applicable, other than as may be required by law (the Change of Control Payment Date). The notice, if mailed or sent electronically, as
applicable, prior to the date of consummation of the Change of Control, will state that the Change of Control Offer is conditioned on the Change of Control being consummated on or prior to the Change of Control Payment Date.
On the Change of Control Payment Date, we will, to the extent lawful:
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accept for payment all Notes (or portions of Notes) properly tendered and not properly withdrawn pursuant to the Change of Control Offer; |
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deposit with the paying agent an amount equal to the aggregate payment in respect of all Notes (or portions of Notes) properly tendered and not properly withdrawn pursuant to the Change of Control Offer; and
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deliver or cause to be delivered to the trustee the Notes properly accepted for purchase, together with an officers certificate stating the aggregate principal amount of Notes (or portions of Notes) being
purchased. |
The paying agent will promptly remit to each holder of Notes properly tendered the purchase price for the Notes,
and the trustee will promptly authenticate and deliver (or cause to be transferred by book-entry) to each holder a new Original Note or Exchange Note, as applicable, equal in principal amount to any unpurchased portion of any Original Note or
Exchange Note, as applicable, surrendered; provided, that each new Note will be in a principal amount equal to $2,000 or an integral multiple of $1,000 in excess thereof.
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We will not be required to make a Change of Control Offer if a third party makes such an offer in
the manner, at the times and otherwise in compliance with the requirements for such an offer made by us and such third party purchases all Notes properly tendered and not withdrawn under its offer.
We will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with the purchase of the Notes as a result of a Change of Control Triggering Event. To the extent that the provisions of any such securities laws or regulations conflict with the Change
of Control Offer provisions of the Notes, we will comply with the applicable securities laws and regulations and will not be deemed to have breached our obligations under the Change of Control Offer provisions of the Notes by virtue of such
conflict.
For purposes of the Change of Control Offer provisions of the Notes, the following terms will be applicable:
Below Investment Grade Rating Event means the rating on the Notes is lowered by at least two of the three Rating Agencies
and the Notes are rated below an Investment Grade rating by at least two of the three Rating Agencies on any date during the period (the Trigger Period) commencing on the earlier of (a) the occurrence of a Change of Control and
(b) the first public announcement by us of any Change of Control (or pending Change of Control) and ending 60 days following the consummation of such Change of Control (which Trigger Period will be extended if the rating of the Notes is under
publicly announced consideration for possible downgrade by any Rating Agency on such 60th day, such extension to last with respect to each Rating Agency until the date on which such Rating Agency considering such possible downgrade either
(x) rates the Notes below Investment Grade or (y) publicly announces that it is no longer considering the Notes for possible downgrade); provided, that a rating event will not be deemed to have occurred in respect of a particular
Change of Control (and thus will not be deemed a Below Investment Grade Rating Event for purposes of the definition of Change of Control Triggering Event) if each Rating Agency making the reduction in rating does not publicly announce or confirm or
inform the trustee in writing at our request that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the Change of Control (whether or not the applicable Change
of Control has occurred at the time of the Below Investment Grade Rating Event).
Capital Stock means:
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in the case of a corporation, corporate stock; |
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in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock; |
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in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and |
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any other interest or participation that confers on a person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing person. |
Change of Control means the occurrence of any one of the following:
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the direct or indirect sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of our assets and
those of our subsidiaries taken as a whole to any person (as that term is used in Section 13(d)(3) of the Exchange Act) other than to us or one of our subsidiaries; |
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the consummation of any transaction (including without limitation, any merger or consolidation) the result of which is that any person (as that term is used in Section 13(d)(3), other than us or one of
our subsidiaries, becomes the beneficial owner (as defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act), directly or indirectly, of more than 50% of our outstanding Voting Stock, or other Voting Stock into which our Voting Stock
is reclassified, consolidated, exchanged or changed, measured by voting power rather than number of shares; |
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the first day on which the majority of the members of our board of directors cease to be Continuing Directors; or |
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we consolidate with, or merge with or into, any person, or any person consolidates with, or merges with or into, us, in any such event pursuant to a transaction in which any of our outstanding Voting Stock or of such
other person is converted into or exchanged for cash, securities or other property other than any such transaction where the shares of our Voting Stock outstanding immediately prior to such transaction constitute, or are converted into or exchanged
for, at least a majority of the Voting Stock of the surviving person immediately after giving effect to such transaction, which transaction shall not constitute a Change of Control. |
Notwithstanding the foregoing, a transaction will not be deemed to involve a Change of Control if (i) we become a direct or indirect
wholly-owned subsidiary of a holding company and (ii) the direct or indirect holders of the Voting Stock of such holding company immediately following that transaction are substantially the same as the holders of our Voting Stock immediately
prior to that transaction.
Change of Control Triggering Event means the occurrence of both a Change of Control and a
Below Investment Grade Rating Event. Notwithstanding the foregoing, no Change of Control Triggering Event will be deemed to have occurred in connection with any particular Change of Control unless and until such Change of Control has actually been
consummated.
Continuing Director means, as of any date of determination, any member of our board of directors who:
(1) was a member of such board of directors on the date of the issuance of the Original Notes; or (2) was nominated for election, elected or appointed to such board of directors with the approval of a majority of the Continuing Directors
who were members of such board of directors at the time of such nomination, election or appointment.
Fitch means Fitch
Ratings, Inc., doing business as Fitch Ratings, or any successor thereto.
Investment Grade means a rating of Baa3 or
better by Moodys (or its equivalent under any successor rating category of Moodys), a rating of BBB- or better by Fitch or S&P (or their respective equivalents under any successor rating categories of either Fitch or S&P) and the
equivalent investment grade credit rating from any replacement rating agency or rating agencies selected by us under the circumstances permitting us to select a replacement agency and in the manner for selecting a replacement agency, in each case as
set forth in the definition of Rating Agency.
Moodys means Moodys Investors Service, Inc., a
subsidiary of Moodys Corporation, and any successor thereto.
Rating Agency means: (i) each of Fitch,
Moodys and S&P; and (ii) if any of Fitch, Moodys or S&P ceases to rate the Notes or fails to make a rating of the Notes publicly available for reasons outside of our control, any nationally recognized statistical
rating organization, within the meaning of Section 3(a)(62) under the Exchange Act, selected by us as a replacement agency for Fitch, Moodys or S&P, or any of them, as the case may be, with respect to making a rating of the
Notes.
S&P means Standard & Poors Ratings Services, a division of The McGraw-Hill Companies, Inc.,
and any successor thereto.
Voting Stock of any specified person as of any date means the Capital Stock of such person
that is at the time entitled to vote generally in the election of the board of directors of such person.
The definition of Change of
Control includes a phrase relating to the direct or indirect sale, lease, transfer, conveyance or other disposition of all or substantially all of our assets and those of our subsidiaries taken as a
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whole. Although there is a limited body of case law interpreting the phrase substantially all, there is no precise established definition of this phrase under applicable law.
Accordingly, the ability of a holder of Notes to require us to purchase such holders Notes as a result of a sale, lease, transfer conveyance or other disposition of less than all of our assets and those of our subsidiaries taken as a whole to
another person may be uncertain.
Our ability to repurchase Notes pursuant to a Change of Control Offer may be limited by a
number of factors. The occurrence of certain of the events that constitute a Change of Control would constitute a default under our senior credit facility. In addition, certain events that may constitute a change of control under our senior credit
facility and cause a default under that agreement will not constitute a Change of Control or a Change of Control Triggering Event under the indenture. Our future indebtedness or that of our subsidiaries may also contain prohibitions of certain
events that would constitute a Change of Control or require such indebtedness to be repurchased upon a Change of Control or a Change of Control Triggering Event. Moreover, the exercise by the holders of Notes of their right to require us to
repurchase the Notes following a Change of Control in connection with a Change of Control Triggering Event could cause a default under the Notes, even if the Change of Control itself does not, due to the financial effect of such repurchase on us.
Finally, our ability to pay cash to the holders upon a repurchase may be limited by our then existing financial resources. There can be no assurance that sufficient funds will be available when necessary to make any required repurchases.
Holders will not be entitled to require us to purchase their Notes in the event of a takeover, recapitalization, leveraged buyout or similar
transaction that is not a Change of Control. We may nonetheless incur significant additional indebtedness in connection with such a transaction.
Holders may not be able to require us to purchase their Notes in certain circumstances involving a significant change in the composition of
our board of directors, including a proxy contest where our board of directors does not endorse the dissident slate of directors but approves them as Continuing Directors. In this regard, a decision of the Delaware Chancery Court (not involving us
or our securities) considered a change of control redemption provision of an indenture governing publicly traded debt securities that is substantially similar to the change of control event described in clause (3) of the definition of
Change of Control. In its decision, the court noted that a board of directors may approve a dissident shareholders nominees solely for purposes of such an indenture, provided the board of directors determines in good
faith that the election of the dissident nominees would not be materially adverse to the interests of the corporation or its stockholders (without taking into consideration the interests of the holders of debt securities in making this
determination). It is unclear whether our board of directors, pursuant to Ohio law, is similarly capable of approving a slate of dissident director nominees. If such an action is possible under Ohio law, the foregoing interpretation would permit our
board to approve a slate of directors that included a majority of dissident directors nominated pursuant to a proxy contest, and the ultimate election of such dissident slate would not constitute a Change of Control that would trigger
your right to require us to repurchase the Notes as described above.
Material Covenants
Limitations on Liens
So long as
any Notes are outstanding, we will not, and we will not permit any Domestic Subsidiary to, incur, issue, assume or guarantee any indebtedness for money borrowed, which we refer to as Debt, secured by any mortgage or other encumbrance,
which we refer to as a Mortgage, on any of our Principal Manufacturing Property or of our Domestic Subsidiaries or any shares of stock or Debt of any Domestic Subsidiaries which own a Principal Manufacturing Property, without
concurrently securing the Notes equally and ratably with such Debt so long as such Debt shall be so secured. This restriction does not apply to Debt secured by (1) our Mortgages or Mortgages of our Domestic Subsidiaries existing at the time of
the indenture; (2) Mortgages on property of, or on any shares of stock of, any corporation existing at the time it becomes a Domestic Subsidiary; (3) Mortgages on property or shares of stock of a Domestic Subsidiary (a) existing at
the time of acquisition thereof (including acquisition through merger or consolidation), (b) to secure the payment of all or any part of the purchase price or construction cost thereof or (c) to secure any Debt incurred prior to, at the
time of, or within 180 days after, the
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acquisition of such property or shares or the completion of any such construction and commencement of full operation of such property for the purpose of financing all or any portion of the
purchase price or construction cost thereof; (4) Mortgages in favor of us or any Domestic Subsidiary; (5) Mortgages in favor of the United States, any state or any subdivision, department, agency or other instrumentality thereof, to secure
progress, advance or other payments pursuant to any contract or provision of any statute; or (6) extensions, renewals or replacements (or successive extensions, renewals or replacements), in whole or in part, of any Mortgage referred to in
(1) through (5).
Notwithstanding the limitations on liens described above, we or any Domestic Subsidiary may incur, issue, assume or
guarantee any Debt secured by a Mortgage on any of our Principal Manufacturing Property or of our Domestic Subsidiaries or any shares of stock or Debt of any Domestic Subsidiary, in addition to that permitted above and without any obligation to
secure the Notes, provided that at the time of such incurrence, issuance, assumption or guarantee of such Debt, and after giving effect thereto, Exempted Debt, in the aggregate, does not exceed 15% of our and our Subsidiaries Consolidated Net
Tangible Assets, taken as a whole.
Limitation on Sale and Leaseback
So long as any Notes are outstanding, we will not, and we will not permit any Domestic Subsidiary to, sell and leaseback for more than three
years any of our Principal Manufacturing Property or of any Domestic Subsidiary acquired, constructed or placed into service more than 180 days before such lease arrangement. This restriction does not apply if (a) we or such Domestic Subsidiary
would be entitled as described in Limitations on Liens above to incur Debt secured by a Mortgage on such Principal Manufacturing Property in a principal amount equivalent to the Attributable Debt in respect of such arrangement
without equally and ratably securing the Notes or (b) we retire Funded Debt or cause Funded Debt to be retired equal to the greater of the net proceeds of such sale or the fair market value of the Principal Manufacturing Property to be subject
to such arrangement.
Notwithstanding the limitations on sale and leaseback transactions described above, we or any Domestic Subsidiary
may enter into a sale and leaseback transaction of any of our Principal Manufacturing Property or of any Domestic Subsidiary in addition to that permitted above and without any obligation to retire any Notes or other indebtedness referred to above,
provided that at the time of entering into such sale and leaseback transaction and after giving effect thereto, Exempted Debt, in the aggregate, does not exceed 15% of our and our Subsidiaries Consolidated Net Tangible Assets, taken as a
whole.
Attributable Debt means, as to any particular lease under which any person (as defined in the indenture) is at
the time liable, at any date as of which the amount thereof is to be determined, the total net amount of rent required to be paid by such person under such lease during the remaining term thereof (after giving effect to any extensions at the option
of the lessee), discounted from the respective due dates thereof to such date at the rate per annum borne by the Notes.
Consolidated Net Tangible Assets means the aggregate amount of assets (less applicable reserves and other properly
deductible items) after deducting therefrom (a) all current liabilities (excluding any liabilities constituting Funded Debt by reason of being renewable or extendible) and (b) all goodwill, trade names, trademarks, patents, unamortized
debt discount and expense and other intangibles, all as set forth on the most recent consolidated balance sheet of us and our consolidated Subsidiaries and computed in accordance with GAAP.
Domestic Subsidiary means a Subsidiary of ours except a Subsidiary (a) that neither transacts any substantial portion
of its business nor regularly maintains any substantial portion of its fixed assets within the United States of America, or (b) that is engaged primarily in financing the operation of us or our Subsidiaries, or both, outside the United States
of America.
Exempted Debt means the sum of the following items outstanding as of the date Exempted Debt is being
determined: (1) indebtedness of us and our Subsidiaries incurred after the date of the indenture and secured by
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Mortgages created or assumed pursuant to the second paragraph under Limitations on Liens above and (2) Attributable Debt of us and our Subsidiaries in respect of every sale
and leaseback transaction entered into after the date of the indenture and pursuant to the second paragraph under Limitation on Sale and Leaseback above.
Funded Debt means all indebtedness for money borrowed having a maturity of more than twelve months from the date as of
which the amount thereof is to be determined, or having a maturity of less than twelve months from the date as of which the amount thereof is to be determined but by its terms being renewable or extendible beyond twelve months from such date at the
option of the borrower.
Principal Manufacturing Property means any building, structure or other facility, together
with the land upon which it is erected and fixtures comprising a part thereof, used primarily for manufacturing or warehousing and located in the United States of America, owned or leased by us or any Subsidiary. The term Principal
Manufacturing Property does not include any of the above referenced property (a) that is financed through the issuance of tax exempt governmental obligations or (b) that our board of directors determines is not materially important
to the total business of us and our Subsidiaries.
Subsidiary means any corporation at least a majority of the voting
stock of which is owned or controlled, directly or indirectly, by us or any of our Subsidiaries or by us and one or more of our Subsidiaries.
Events
of Default
Each of the following is an event of default with respect to the Notes under the indenture:
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failure to pay interest (including any additional interest) when due, if the failure continues for 30 days; |
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failure to pay the principal or premium, if any, when due, at maturity, upon any redemption, by declaration or otherwise; |
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failure to observe or perform any other covenant contained in the Notes or the indenture, other than a covenant specifically relating to another series of debt securities, if the failure continues for 90 days after the
Company receives notice from the trustee or holders of at least 25% in aggregate principal amount of the Notes then outstanding; |
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certain events of bankruptcy, insolvency or reorganization of the Company, but not of its subsidiaries; and |
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default on any indebtedness for money borrowed by the Company or a Domestic Subsidiary in excess of $100,000,000 principal amount that results in the acceleration of such indebtedness prior to its maturity, if such
indebtedness is not discharged, or such acceleration is not annulled, by the end of a period of 30 days after written notice to the Company by the trustee or to the Company and the trustee by the holders of at least 25% in principal amount of the
Notes then outstanding. |
If an event of default with respect to the Notes (other than a bankruptcy default) occurs and is
continuing, the trustee or the holders of at least 25% in aggregate principal amount of the Notes then outstanding, by notice in writing to us, and to the trustee if notice is given by those holders, may declare the unpaid principal of, premium, if
any, and accrued interest, if any, due and payable immediately. If a bankruptcy default occurs with respect to us, the principal of, premium, if any, and accrued interest on all of the Notes issued under the indenture will become immediately due and
payable without any declaration or other act of the trustee or the holders.
The holders of a majority in principal amount of the Notes
then outstanding may waive any default or event of default with respect to the Notes and its consequences, except defaults or events of default regarding payment of principal, premium, if any, or interest.
Any waiver will be deemed to cure the default or event of default to which the waiver relates.
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Subject to the terms of the indenture, if an event of default occurs and is continuing, the
trustee will be under no obligation to exercise any of its rights or powers under the indenture at the request or direction of any of the holders of the Notes, unless such holders have offered the trustee reasonable indemnity. The holders of a
majority in principal amount of the Notes then outstanding will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the trustee, or exercising any trust or power conferred on the trustee, with
respect to the Notes, provided that:
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it is not in conflict with any law or the indenture; |
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the trustee may take any other action deemed proper by it which is not inconsistent with the direction; and |
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subject to its duties under the TIA, the trustee need not take any action that might involve it in personal liability or might be unduly prejudicial to the holders not involved in the proceeding. |
A holder of Notes will only have the right to institute a proceeding under the indenture or to appoint a receiver or another trustee, or to
seek other remedies, if:
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the holder has given written notice to the trustee of a continuing event of default with respect to the Notes; |
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the holders of at least 25% in aggregate principal amount of the Notes then outstanding have made a written request therefor, and the holders have offered indemnity reasonably satisfactory to the trustee to institute
the proceedings as trustee; and |
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the trustee does not institute the proceeding and does not receive from the holders of a majority in aggregate principal amount of the Notes then outstanding other conflicting directions within 60 days after the notice,
request and offer. |
These limitations do not apply to a suit instituted by a holder of Notes if we default in the payment of
the principal of, premium, if any, or interest on the Notes.
Satisfaction and Discharge
The indenture will be discharged and will, subject to certain surviving provisions, cease to be of further effect as to all Notes issued thereunder when:
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we deliver to the trustee all outstanding Notes issued under the indenture (other than Notes replaced because of mutilation, loss, destruction or wrongful taking) for cancellation; or |
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all Notes outstanding under the indenture have become due and payable, whether at maturity or as a result of the mailing or sending of a notice of redemption or will become due and payable within one year (including as
result of the mailing or sending of a notice of redemption), and we irrevocably deposit with the trustee as funds in trust solely for the benefit of the holders of Notes, cash in U.S. dollars, noncallable U.S. government securities, or a combination
thereof, sufficient to pay at maturity or upon redemption all Notes outstanding under the indenture, including interest thereon. |
The
trustee will acknowledge satisfaction and discharge of the indenture on our demand accompanied by an officers certificate and an opinion of counsel, upon which the trustee shall have no liability in relying, stating that all conditions
precedent to satisfaction and discharge have been complied with and at our cost and expense.
Defeasance and Covenant Defeasance
We may elect either:
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to defease and be discharged from any and all obligations with respect to the Notes; or |
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to be released from our obligations described above under Change of control triggering event, Limitations on liens and Limitations on sale and leaseback with respect
to the Notes, only: |
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upon the deposit with the applicable trustee, in trust, of money and/or U.S. government obligations, which through the payment of interest and principal of the U.S. government obligations in accordance with their terms
will provide money in an amount sufficient to pay any installment of principal and premium, if any, and interest on such Notes on the maturity date thereof in accordance with the terms of the indenture and the Notes; |
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upon delivery to the trustee by us of an opinion of counsel to the effect that the deposit and related defeasance or release will not cause the holders of the Notes to recognize income, gain or loss for federal income
tax purposes and will be subject to federal income tax on the same amounts, in the same manner and at the same times as if the defeasance had not occurred; provided that with respect a defeasance under item (1) above, the legal opinion
must be based on either an Internal Revenue Service ruling or a change in law since the date of the indenture; |
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at the time of defeasance or release no Event of Default with respect to Notes will have occurred or be continuing; and |
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if certain other conditions are satisfied. |
The amount deposited with the trustee can be
decreased at a later date if, in the opinion of a nationally recognized firm of independent public accountants, the deposits are greater than the amount then needed to pay principal of, and interest and any premium on, the Notes when those amounts
are scheduled to be paid.
Our obligations relating to the Notes will be reinstated if the trustee is unable to pay the Notes with the
deposits held in trust, due to an order of any court or governmental authority. It is possible that the Notes defeased under item (2) above may later be declared immediately due in full because of an event of default not relating to the
covenants that were defeased. If that happens, we must pay the Notes in full at that time using the deposits held in trust or other money.
Consolidation, Merger and Sale of Assets
We may, without the consent of the trustee or the holders of outstanding Notes, consolidate or merge with or into, or convey, transfer or lease
our properties and assets substantially as an entirety to, any other person, provided that:
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any successor person formed by or surviving any consolidation or merger or any person to which a conveyance, transfer or lease has been made that, in either case, is a corporation, limited liability company, partnership
or trust organized under the laws of the United States of America, any state thereof or the District of Columbia; |
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such successor person expressly assumes all of our obligations under the indenture and the Notes; |
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there is no default under the indenture immediately after giving effect to the merger, consolidation or conveyance, lease or transfer, as the case may be; and |
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the trustee receives, if requested, an opinion of counsel that the merger, consolidation or conveyance, lease or transfer, as the case may be, complies with the applicable provisions of the indenture. |
Thereafter, except with respect to a lease, we will be relieved of all our obligations under the indenture and the Notes.
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Same-day Settlement and Payment
The Notes will trade in the same-day funds settlement system of DTC until maturity or until we issue the Notes in definitive form. DTC will
therefore require secondary market trading activity in the Notes to settle in immediately available funds. We can give no assurance as to the effect, if any, of settlement in immediately available funds on trading activity in the Notes.
Additional Notes
We may from time to
time, without notice to or the consent of the registered holders of the Notes, create and issue additional debt securities having the same terms as, and ranking equally and ratably with, the Notes in all respects (or in all respects except for the
payment of interest accruing prior to the issue date of such additional debt securities, or, in some cases, the first payment of interest following the issue date of such additional debt securities or registration rights), so that the additional
debt securities will be consolidated and form a single series with, and have the same terms as to status, redemption or otherwise as, the Notes.
Any additional debt securities that are consolidated and form a single series with the Notes will be issued for U.S. federal income tax
purposes in a qualified reopening or with no more than a de minimis amount of original issue discount.
We may at any
time and from time to time purchase Notes in the open market or otherwise.
Modification of Indenture; Waiver
We and the trustee may, without the consent of any holders, change the terms of the indenture with respect to certain matters, including:
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to cure any ambiguity, omission, defect or inconsistency in the indenture; |
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to provide for uncertificated Notes in addition to or in place of certificated Notes; |
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to change any provision if the change does not materially adversely affect the interests of any holder of Notes; |
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to provide for the assumption, by a successor person or the acquiror of all or substantially all of our assets, of our obligations under the indenture and the Notes; |
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to conform the text of the indenture or the Notes to any provision of this Description of Notes to the extent that such provision in this Description of Notes was intended to be a verbatim recitation of a provision of
the indenture or the Notes, which intent may be evidenced by an officers certificate to that effect; |
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to provide for additional Notes; |
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to add any additional events of default; |
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to add to our covenants or provide additional rights for the benefit of holders of Notes or to surrender any right or power conferred upon us; and |
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to comply with any requirement in connection with the qualification of the indenture under the TIA. |
In addition, under the indenture, we may change the rights of holders of Notes and the trustee with the written consent of the holders of at
least a majority in aggregate principal amount of the outstanding Notes. However, the following changes may only be made with the consent of each holder of the Notes:
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changing the stated maturity of the principal of, or any installment of interest on, the Notes; |
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reducing the principal amount, reducing the rate of or extending the time of payment for interest, or reducing any premium payable upon the redemption of the Notes; |
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changing the currency of payment of principal of, or premium, if any, or interest on, the Notes; or |
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impairing a holders right to initiate suit for the enforcement of any payment on or with respect to the Notes. |
In addition, any reduction in the percentage of principal amount of the Notes, the holders of which are required to consent to any amendment,
modification or waiver under the indenture or the Notes will require the affirmative consent of at least the percentage of Notes that would originally have been required to make such consent, modification or waiver effective.
Ownership of Beneficial Interests
We
expect that, pursuant to the procedures established by DTC, upon the issuance of each global note representing a beneficial interest in the Exchange Notes, DTC will credit, on its book-entry registration and transfer system, the respective principal
amount of the individual beneficial interests represented by the global note to the accounts of participants. Ownership of beneficial interests in each global note will be limited to participants or persons that may hold interests through
participants. Ownership of beneficial interests in each global note will be shown on, and the transfer of those ownership interests will be effected only through, records maintained by DTC (with respect to participants interests) and such
participants (with respect to the owners of beneficial interests in the global note other than participants).
So long as DTC, or its
nominee, is the registered holder and owner of a global note, DTC or such nominee, as the case may be, will be considered the sole legal owner of the Exchange Notes represented by the global note for all purposes under the indenture, the Exchange
Notes and applicable law. Except as set forth below, owners of beneficial interests in a global note will not be entitled to receive definitive Exchange Notes, will not be entitled to have the Exchange Notes represented by the global note registered
in their names and will not be considered to be the owners or holders of any Exchange Notes under the global note. We understand that under existing industry practice, in the event an owner of a beneficial interest in a global note desires to take
any actions that DTC, as the holder of the global note, is entitled to take, DTC would authorize the participants to take such action, and that participants would authorize beneficial owners owning through such participants to take such action or
would otherwise act upon the instructions of beneficial owners owning through them. No beneficial owner of an interest in a global note will be able to transfer the interest except in accordance with DTCs applicable procedures. Because DTC can
only act on behalf of participants, who in turn act on behalf of others, the ability of a person having a beneficial interest in a global note to pledge that interest to persons that do not participate in the DTC system, or otherwise to take actions
in respect of that interest, may be impaired by the lack of a physical certificate of that interest.
All payments on the Exchange Notes
represented by a global note registered in the name of and held by DTC or its nominee will be made to DTC or its nominee, as the case may be, as the registered owner and holder of the global note.
We expect that DTC or its nominee, upon receipt of any payment of principal or interest in respect of a global note, will credit
participants accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of the global note as shown on the records of DTC or its nominee. We also expect that payments by participants to
owners of beneficial interests in the global note held through such participants will be governed by standing instructions and customary practices, as is now the case with securities held for accounts of customers in the names of nominees for such
customers. Such payments, however, will be the responsibility of such participants and indirect participants, and neither we, the trustee nor any paying agent will have any responsibility or liability for any aspect of the records relating to, or
payments made on account of, beneficial ownership interests in any global note or for maintaining, supervising or reviewing any records
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relating to such beneficial ownership interests or for any other aspect of the relationship between DTC and its participants or the relationship between such participants and the owners of
beneficial interests in the global note.
Unless and until it is exchanged in whole or in part for definitive notes, no global note may be
transferred except as a whole by DTC to a nominee of DTC or by a nominee of DTC to DTC or another nominee of DTC. Transfers between participants in DTC will be effected in the ordinary way in accordance with DTC rules and will be settled in same-day
funds.
We expect that DTC will take any action permitted to be taken by a holder of Exchange Notes (including the presentation of
Exchange Notes for exchange as described below) only at the direction of one or more participants to whose account the DTC interests in a global note are credited and only in respect of such portion of the aggregate principle amount of the Exchange
Notes as to which such participant or participants has or have given such direction. However, if there is an event of default under the Exchange Notes, DTC will exchange each global note for definitive Exchange Notes, which it will distribute to its
participants.
Although we expect that DTC will agree to the foregoing procedures in order to facilitate transfers of interests in each
global note among participants of DTC, DTC is under no obligation to perform or continue to perform such procedures, and such procedures may be discontinued at any time. Neither the trustee nor we will have any responsibility for the performance or
nonperformance by DTC or their participants or indirect participants of their respective obligations under the rules and procedures governing their operations.
The indenture provides that if:
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DTC notifies us that it is unwilling or unable to continue as depositary or if DTC ceases to be eligible under the indenture and we do not appoint a successor depositary within 90 days; |
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we determine that the Notes shall no longer be represented by global notes, and we execute and deliver to the trustee, in our discretion, a company order to such effect; or |
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an event of default with respect to the Notes shall have occurred and be continuing |
the global notes will be
exchanged for Notes in definitive form of like tenor and of an equal principal amount, in authorized denominations. Such definitive notes shall be registered in such name or names as DTC shall instruct the trustee. We expect that such instructions
may be based upon directions received by DTC from participants with respect to ownership of beneficial interest in global securities.
Holding
through Euroclear and Clearstream
If the depositary for a global security is DTC, you may hold interests in the global security
through Clearstream or Euroclear, in each case, as a participant in DTC. Euroclear and Clearstream will hold interests, in each case, on behalf of their participants through customers securities accounts in the names of Euroclear and
Clearstream on the books of their respective depositaries, which in turn will hold such interests in customers securities in the depositaries names on DTCs books.
Payments, deliveries, transfers, exchanges, notices and other matters relating to the Notes made through Euroclear or Clearstream must comply
with the rules and procedures of those systems. Those systems could change their rules and procedures at any time. We have no control over those systems or their participants, and we take no responsibility for their activities. Transactions between
participants in Euroclear or Clearstream on one hand, and other participants in DTC, on the other hand, would also be subject to DTCs rules and procedures.
Investors will be able to make and receive through Euroclear and Clearstream payments, deliveries, transfers, exchanges, notices and other
transactions involving any securities held through those systems only on days when those systems are open for business. Those systems may not be open for business on days when banks, brokers and other institutions are open for business in the United
States.
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In addition, because of time-zone differences, U.S. investors who hold their interests in the
Notes through these systems and wish on a particular day to transfer their interests, or to receive or make a payment or delivery or exercise any other right with respect to their interests, may find that the transaction will not be effected until
the next business day in Luxembourg or Brussels, as applicable. Thus, investors who wish to exercise rights that expire on a particular day may need to act before the expiration date. In addition, investors who hold their interests through both DTC
and Euroclear or Clearstream may need to make special arrangements to finance any purchase or sales of their interests between the U.S. and European clearing systems, and those transactions may settle later than transactions within one clearing
system.
Regarding the Trustee
The
Bank of New York Mellon Trust Company, N.A., is the trustee under the indenture. The trustee, other than when an event of default with respect to the Notes has occurred and is continuing, will undertake to perform only such duties as are
specifically set forth in the indenture and, upon an event of default with respect to the Notes, will be required to use the same degree of care as a prudent person would exercise or use in the conduct of his or her own affairs. Subject to this
provision, the trustee is under no obligation to exercise any of the powers given it by the indenture at the request of any holder of Notes unless it is offered reasonable security and indemnity against the costs, expenses and liabilities that it
might incur. The trustee is not required to spend or risk its own money or otherwise become financially liable while performing its duties unless it reasonably believes that it will be repaid or receive indemnity reasonably satisfactory to it.
Paying Agents and Payment
Payment of
interest on the Notes on any interest payment date will be made to the person in whose name such Notes, or one or more predecessor securities, are registered at the close of business on the regular record date for the payment of such interest.
Principal of, premium or additional interest, if any, and interest on the Notes will be payable at the office of the paying agents designated
by us, except that premium and additional interest, if any, and interest payments may be made by check mailed to the holder. We will be required to maintain a paying agent in each place of payment for the Notes.
All moneys paid by us to a paying agent or the trustee for the payment of the principal of, or premium or additional interest, if any, or
interest on the Notes which remains unclaimed at the end of two years after the principal, premium or additional interest, if any, or interest has become due and payable will be repaid to us, and after that time the holder of the Notes may look only
to us for payment of those amounts.
Governing Law
The indenture and the Notes are governed by and will be construed in accordance with the laws of the State of New York.
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UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
The following is a summary of certain United States federal income tax considerations relating to the exchange of unregistered Original
Notes for registered Exchange Notes pursuant to the Exchange Offer, but does not purport to be a complete analysis of all the potential tax considerations relating to the Exchange Offer. This summary is based upon the provisions of the Code,
Treasury Regulations promulgated thereunder, administrative rulings and pronouncements, and judicial decisions, all as in effect on the date of this prospectus and all of which are subject to change, possibly with retroactive effect, or different
interpretations.
This discussion does not address all of the United States federal income tax considerations that may be relevant to
a holder in light of such holders particular circumstances or to holders subject to special rules, such as banks and certain other financial institutions, insurance companies, entities treated as partnerships for the United States federal
income tax purposes and other pass-through entities (and investors therein), regulated investment companies, real estate investment trusts, U.S. expatriates, dealers in securities or currencies, traders in securities, United States holders whose
functional currency is not the U.S. dollar, holders subject to alternative minimum tax, tax-exempt organizations, tax deferred or other retirement accounts and persons holding the Notes as part of a hedging transaction, straddle, conversion
transaction or other integrated transaction. In addition, this discussion is limited to persons that hold the Notes as capital assets (generally, property held for investment) within the meaning of Section 1221 of the Code. This
discussion does not address United States federal tax laws other than those pertaining to the United States federal income tax (such as the gift tax, the estate tax and the Medicare tax) or the effect of any applicable state, local or foreign tax
laws.
This summary of certain United States federal income tax considerations is for general information only and is not tax advice. This
summary is not binding on the Internal Revenue Service (the IRS). We have not sought and will not seek any rulings from the IRS with respect to the statements made in this summary, and there can be no assurance that the IRS will not take
a position contrary to these statements or that a contrary position taken by the IRS would not be sustained by a court. You are urged to consult your own tax advisor with respect to the application of the United States federal income tax laws to
your particular situation, as well as any tax considerations arising under other U.S. federal tax laws, the laws of any state, local or foreign taxing jurisdiction or any applicable income tax treaty.
The exchange of an Original Note for an Exchange Note pursuant to the Exchange Offer will not constitute a taxable disposition of the Original
Note for United States federal income tax purposes. Rather, the Exchange Note you receive will be treated as a continuation of your investment in the corresponding Original Note surrendered in the exchange. Consequently, you will not recognize any
taxable income, gain or loss upon the receipt of an Exchange Note pursuant to the Exchange Offer, your holding period for an Exchange Note will include your holding period of the Original Note exchanged pursuant to the Exchange Offer, and your tax
basis in an Exchange Note will be the same as your adjusted tax basis in the Original Note immediately before such exchange. The United States federal income tax consequences of holding and disposing of an Exchange Note received pursuant to the
Exchange Offer generally will be the same as the United States federal income tax consequences of holding and disposing of an Original Note.
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CERTAIN ERISA CONSIDERATIONS
The following summary regarding certain aspects of ERISA, and the Code is based on ERISA, the Code, judicial decisions and United States
Department of Labor and IRS regulations and rulings that are in existence on the date of this prospectus. This summary is general in nature and does not address every issue pertaining to ERISA and the Code that may be applicable to us, the Exchange
Notes or a particular investor. Accordingly, each prospective investor, including plan fiduciaries, should consult with his, her or its own advisors or counsel with respect to the advisability of an investment in the Exchange Notes, and potentially
adverse consequences of such investment, including, without limitation, certain ERISA-related issues that affect or may affect the investor with respect to this investment and the possible effects of changes in the applicable laws.
ERISA and the Code impose certain requirements on employee benefit plans that are subject to Title I of ERISA, plans subject to
Section 4975 of the Code and entities that are deemed to hold the assets of such plans (each such employee benefit plan, or plans or entity, a Plan) and on those persons who are fiduciaries with respect to Plans. A
fiduciary of a Plan subject to Title I of ERISA should consider whether an investment in the Exchange Notes satisfies ERISAs general fiduciary requirements, including, but not limited to, the requirement of investment prudence and
diversification and the requirement that such a Plans investments be made in accordance with the documents governing the Plan.
An
investor who is considering acquiring the Exchange Notes with the assets of a Plan must consider whether the acquisition and holding of the Exchange Notes will constitute or result in a non-exempt prohibited transaction. Section 406 of ERISA
and Section 4975 of the Code prohibit certain transactions that involve a Plan and a party in interest as defined in Section 3(14) of ERISA or a disqualified person as defined in Section 4975 of the Code with
respect to such Plan. Examples of such prohibited transactions include, but are not limited to, (i) sales or exchanges of property (such as the Exchange Notes), or (ii) extensions of credit between a Plan and a party in interest or
disqualified person or (iii) the transfer to, or use by or for the benefit of, a party in interest or disqualified person, of any Plan assets. Such parties in interest or disqualified persons could include, without limitation, the Company, the
Trustee, registrar and paying agent or any of their respective affiliates.
ERISA and the Code contain certain exemptions from the
prohibited transactions described above, and the Department of Labor has issued several exemptions, although certain exemptions do not provide relief from the prohibitions on self-dealing contained in Section 406(b) of ERISA and Sections
4975(c)(1)(E) and (F) of the Code. Such exemptions include Section 408(b)(17) of ERISA and Section 4975(d)(20) of the Code pertaining to certain transactions with non-fiduciary service providers; Department of Labor Prohibited
Transaction Class Exemption (PTCE) 95-60, applicable to transactions involving insurance company general accounts; PTCE 90-1, regarding investments by insurance company pooled separate accounts; PTCE 91-38, regarding investments
by bank collective investment funds; PTCE 84-14, regarding investments effected by a qualified professional asset manager; and PTCE 96-23, regarding investments effected by an in-house asset manager. There can be no assurance that any of these
exemptions or any other exemption will be available with respect to the Exchange Notes. Any particular transaction involving a party in interest or disqualified person who engages in a non-exempt prohibited transaction may be subject to excise taxes
and other penalties and liabilities under ERISA and the Code.
As a general rule, governmental plans, as defined in Section 3(32) of
ERISA (Governmental Plans), church plans, as defined in Section 3(33) of ERISA, that have not made an election under 410(d) of the Code (Church Plans) and non-U.S. plans are not subject to the requirements
of ERISA or Section 4975 of the Code. Accordingly, assets of such plans generally may be invested in the Exchange Notes without regard to the fiduciary and prohibited transaction considerations under ERISA and Section 4975 of the Code
described above. However, Governmental Plans, Church Plans or non-U.S. plans may be subject to other United States federal, state or local laws or non-U.S. laws that regulate their investments (a Similar Law). A fiduciary of a
Governmental Plan, a Church Plan or a non-U.S. plan should make its own determination as to the requirements, if any, under any Similar Law applicable to the acquisition of the Exchange Notes.
36
The Exchange Notes may be acquired by a Plan and any person investing plan assets of
any Plan or by a Governmental Plan, a Church Plan or a non-U.S. plan, but only if the acquisition, holding and disposition of the Exchange Notes will not result in a non-exempt prohibited transaction under ERISA or Section 4975 of the Code or a
violation of Similar Law. Therefore, any investor in the Exchange Notes will be deemed to represent and warrant to us and the Trustee that (1)(a) it is not (i) a Plan, (ii) a Governmental Plan, (iii) a Church Plan or (iv) a
non-U.S. plan, or (b) it is a Plan and the exchange of the Original Notes for the Exchange Notes and holding and disposition of the Exchange Notes will not result in a non-exempt prohibited transaction under Section 406 of ERISA or
Section 4975 of the Code, or (c) it is a Governmental Plan, a Church Plan or a non-U.S. plan and the exchange of the Original Notes for the Exchange Notes and the holding and disposition of the Exchange Notes will not result in a violation
of Similar Law; and (2) it will notify us and the Trustee immediately if, at any time, it is no longer able to make the representations contained in clause (1) above.
This Exchange Offer is not a representation by us that an acquisition of the Exchange Notes meets all legal requirements applicable to
investments by Plans, Governmental Plans, Church Plans or non-U.S. plans or that such an investment is appropriate for any particular Plan, Governmental Plan, Church Plan or non-U.S. plan.
37
PLAN OF DISTRIBUTION
Any broker-dealer that holds Original Notes that were acquired for its own account as a result of market-making activities or other trading
activities (other than Original Notes acquired directly from us) may exchange such Original Notes pursuant to the Exchange Offer. Any such broker-dealer, however, may be deemed to be an underwriter within the meaning of the Securities
Act and must, therefore, deliver a prospectus meeting the requirements of the Securities Act in connection with any resales of Exchange Notes received by such broker-dealer in the Exchange Offer. Such prospectus delivery requirement may be satisfied
by the delivery by such broker-dealer of this prospectus. We have agreed to make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with such resales for up to 180 days from the effective date of the
registration statement of which this prospectus forms a part.
We will not receive any proceeds from any sale of Exchange Notes by
broker-dealers. Exchange Notes received by broker-dealers for their own account in the Exchange Offer may be sold from time to time in one or more transactions in the over-the-counter market, in negotiated transactions, through the writing of
options on the Exchange Notes or a combination of such methods of resale, at market prices prevailing at the time of resale, at prices related to such prevailing market prices or negotiated prices. Any of these resales may be made directly to
purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from these broker-dealers and/or the purchasers of Exchange Notes. Any broker-dealer that resells Exchange Notes that were received
by it for its own account in the Exchange Offer and any broker-dealer that participates in a distribution of the Exchange Notes may be deemed to be an underwriter within the meaning of the Securities Act and any profit on any such resale
of Exchange Notes and any commission or concessions received by any such person may be deemed to be underwriting compensation under the Securities Act. The accompanying letter of transmittal states that, by acknowledging that it will deliver and by
delivering a prospectus, a broker-dealer will not be deemed to admit that it is an underwriter within the meaning of the Securities Act.
We have agreed to pay all expenses incident to the Exchange Offer, including the expenses of one counsel for the holders of the Original Notes
and will indemnify the holders of the Original Notes against certain liabilities, including liabilities under the Securities Act.
38
LEGAL MATTERS
Jones Day will pass upon the validity of the Exchange Notes.
EXPERTS
The consolidated financial statements of The Timken Company appearing in The Timken Companys Annual Report (Form 10-K) for the year
ended December 31, 2014 (including the schedule appearing therein), and the effectiveness of The Timken Companys internal control over financial reporting as of December 31, 2014 have been audited by Ernst & Young LLP,
independent registered public accounting firm, as set forth in their reports thereon, included therein, and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon such reports
given on the authority of such firm as experts in accounting and auditing.
WHERE YOU CAN FIND MORE
INFORMATION
We are subject to the informational reporting requirements of the Exchange Act. We file annual, quarterly and current
reports, proxy statements and other information with the SEC. Our SEC filings are available over the Internet at the SECs website at www.sec.gov. You may read and copy any reports, statements and other information filed by us at the SECs
Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. Please call 1-800-SEC-0330 for further information on the Public Reference Room. You may also inspect our SEC reports and other information at the New York Stock Exchange, 20 Broad
Street, New York, New York 10005.
We make available free of charge, on or through our website, our annual reports on Form 10-K, quarterly
reports on Form 10-Q and current reports on Form 8-K, and amendments to these reports, as soon as reasonably practicable after we electronically file such material with, or furnish such material to, the SEC. You may access these documents on the
Investors section of our website at www.timken.com/investors. Information contained on or accessible through our website is not part of this prospectus, other than the documents that we file with the SEC that are incorporated by
reference into this prospectus.
39
INFORMATION WE INCORPORATE BY REFERENCE
In this prospectus, we are incorporating certain information that we file with the SEC, which means that we can disclose important information
to you by referring you to those documents. The information incorporated by reference is considered to be a part of this prospectus, and some information that we file later with the SEC will automatically update and supersede this information. Any
statement contained in any document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained in or omitted from this
prospectus, or in any other subsequently filed document that also is or is deemed to be incorporated by reference herein, modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this prospectus.
We incorporate by reference the documents listed below that we filed with the SEC
under the Exchange Act:
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|
|
our annual report on Form 10-K for the year ended December 31, 2014. |
We are also
incorporating by reference additional documents we may file with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act (1) after the date of the initial filing of this registration statement, of which this prospectus forms
a part, and prior to the effectiveness of this registration statement and (2) after the date of this prospectus until the Exchange Offer has been completed. We will not, however, incorporate by reference in this prospectus any documents or
portions thereof that are not deemed filed with the SEC, including any information furnished pursuant to Item 2.02 or Item 7.01 of our current reports on Form 8-K unless, and except to the extent, specified in such current
reports.
You may obtain copies of these filings without charge by requesting the filings in writing or by telephone at the following
address.
The Timken Company
4500 Mt. Pleasant St. N.W.
North
Canton, Ohio 44720-5450
(234) 262-3000
Attn: Steven D. Tschiegg
DirectorCapital Markets and Investor Relations
40
The Timken Company
PROSPECTUS
Offer to Exchange up to $350,000,000
Aggregate Principal Amount of Newly
Issued 3.875% Senior Notes due 2024
For
a Like Principal
Amount of Outstanding
Restricted 3.875% Senior Notes due 2024
Issued on August 20, 2014
, 2015
PART II
INFORMATION NOT REQUIRED IN DOCUMENT
Item 20. |
Indemnification of Directors and Officers. |
Our regulations provide that we will
indemnify, to the fullest extent permitted by law, any person who was or is 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, by
reason of the fact that he is or was a director or officer of us, or is or was serving at our request as a director, trustee or officer of another corporation, domestic or foreign, non-profit or for-profit, partnership, joint venture, trust or other
enterprise. We will not be required to indemnify any person with respect to any action, suit or proceeding that was initiated by that person unless the action, suit or proceeding was initiated to enforce any rights to indemnification under our
regulations and the person is formally adjudged to be entitled to indemnity. The indemnification obligation provided in our regulations is not exclusive of any other rights to which those seeking indemnification may be entitled under any law, our
articles of incorporation or any agreement, vote of shareholders or of disinterested directors or otherwise, both as to action in official capacities and as to action in another capacity while he or she is our director or officer and shall continue
as to a person who has ceased to be a director, trustee or officer and shall inure to the benefit of the heirs, executors and administrators of that person.
Our regulations also permit us to purchase and maintain insurance on behalf of any persons that we are required to indemnify under the
regulations against any liability asserted against and incurred by that person, in their status or capacity as a party we must indemnify, whether or not we would have the power to indemnify such person against such liability. We may also, to the
fullest extent permitted by law, enter into an indemnification agreement with any persons that we are required to indemnify under the regulations.
We have entered into contracts with some of our directors and officers to indemnify them against many of the types of claims that may be made
against them. We also maintain insurance coverage for the benefit of directors and officers with respect to many types of claims that may be made against them, some of which may be in addition to those described in the regulations.
Section 1701.13 of the Ohio Revised Code, or Section 1701.13, generally permits indemnification of any director, officer or employee
with respect to any proceeding against any such person provided that: (a) such person acted in good faith, (b) such person reasonably believed that the conduct was in or not opposed to the best interests of the corporation, and (c) in
the case of criminal proceedings, such person had no reasonable cause to believe that the conduct was unlawful. Indemnification may be made against expenses (including attorneys fees), judgments, fines and settlements actually and reasonably
incurred by such person in connection with the proceeding; provided, however, that if the proceeding is one by or in the right of the corporation, indemnification may be made only against actual and reasonable expenses (including attorneys
fees) and may not be made with respect to any proceeding in which the director, officer or employee has been adjudged to be liable to the corporation, except to the extent that the court in which the proceeding was brought shall determine, upon
application, that such person is, in view of all the circumstances, entitled to indemnity for such expenses as the court shall deem proper. To the extent that a director, officer or employee is successful on the merits or otherwise in defense of the
proceeding, indemnification is required. The termination of any proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent does not, of itself, create a presumption that the director, officer or
employee did not meet the standard of conduct required for indemnification to be permitted.
Section 1701.13 further provides that
indemnification thereunder may not be made by the corporation unless authorized after a determination has been made that such indemnification is proper, with that determination to be made (a) by the Board of Directors by a majority vote of a
quorum consisting of directors not parties to the proceedings; (b) if such a quorum is not obtainable, or, even if obtainable, but a quorum of disinterested directors so directs, by independent legal counsel in a written opinion; (c) by
the shareholders; or (d) by the court in which the proceeding was brought. However, a director (but not an officer, employee or agent) is entitled to mandatory advancement of expenses, including attorneys fees, incurred in defending any
action, including derivative
actions, brought against the director, provided that the director agrees to cooperate with the corporation concerning the matter and to repay the amount advanced if it is proved by clear and
convincing evidence that such directors act or failure to act was done with deliberate intent to cause injury to the corporation or with reckless disregard for the corporations best interests.
Finally, Section 1701.13 provides that indemnification or advancement of expense provided by that Section is not exclusive of any other
rights to which those seeking indemnification may be entitled under the articles of incorporation or regulations or any agreement, vote of shareholders or disinterested directors or otherwise.
Item 21. |
Exhibits And Financial Statement Schedules. |
(a) Exhibits. The following exhibits are
filed as part of this Registration Statement:
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Exhibit No. |
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Description |
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3.1 |
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Amended Articles of Incorporation of The Timken Company, (effective May 31, 2013) were filed on July 31, 2013 with Form 10-Q (Commission File No. 1-1169) and are incorporated herein by reference. |
|
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3.2 |
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Amended Regulations of The Timken Company adopted on February 14, 2014, were filed on February 14, 2014 with Form 8-K (Commission File No. 1-1169) and are incorporated herein by reference. |
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4.1 |
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Indenture, dated August 20, 2014, by and between The Timken Company and The Bank of New York Mellon Trust Company, N.A., as trustee, was filed on August 20, 2014 with Form 8-K (Commission File No. 1-1169) and is incorporated herein
by reference. |
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5.1 |
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Opinion of Jones Day. |
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10.1 |
|
Registration Rights Agreement, dated August 20, 2014, by and among The Timken Company, Morgan Stanley & Co. LLC and Deutsche Bank Securities Inc., was filed on August 20, 2014 with Form 8-K (Commission File No. 1-1169) and is
incorporated herein by reference. |
|
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12.1 |
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Computation of Ratio of Earnings to Fixed Charges, filed on March 2, 2015 with Form 10-K (Commission File No. 1-1169) and is incorporated herein by reference. |
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23.1 |
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Consent of Independent Registered Public Accounting Firm. |
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23.2 |
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Consent of Jones Day (Included in Exhibit 5.1). |
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24.1 |
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Powers of Attorney. |
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25.1 |
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Form T-1 of The Bank of New York Mellon Trust Company, N.A., under the Trust Indenture Act of 1939. |
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99.1 |
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Form of Letter of Transmittal. |
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 1933;
(ii) to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the
most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the
II-2
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 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.
(2) That, for the purpose of determining any
liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the securities
being registered which remain unsold at the termination of the offering.
(4) That, for the purpose of determining liability under the
Securities Act of 1933 to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance
on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. 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 in 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 first use, 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 date of first use.
(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 in 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 exchange offer
required to be filed pursuant to Rule 424;
(ii) any free writing prospectus relating to the exchange offer prepared by or
on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
(iii) the portion of any
other free writing prospectus relating to the exchange offer containing material information about the undersigned registrant or their securities provided by or on behalf of the undersigned registrant; and
(iv) any other communication that is an offer in the exchange offer made by the undersigned registrant to the purchaser.
The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of
registrants annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plans annual report pursuant to section 15(d) of the Securities
Exchange Act of 1934) 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 of 1933 may
be permitted to directors, officers and controlling persons of the registrant, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy and is, therefore,
II-3
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, each registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
The undersigned registrant hereby undertakes to respond to requests for information that is incorporated by
reference in the prospectus pursuant to Items 4, 10(b), 11, or 13 of this form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information
contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request.
The undersigned registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction, and
the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective.
II-4
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of North Canton, State of Ohio, on March 12, 2015.
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THE TIMKEN COMPANY |
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By: |
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/s/ J. Ted Mihaila |
Name: |
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J. Ted Mihaila |
Title: |
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Senior Vice President and Controller |
Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed
by the following persons in the capacities and on the dates indicated.
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Signature |
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Title |
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Date |
*
Richard G. Kyle |
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President and Chief Executive Officer
(Principal Executive Officer) and Director |
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March 12, 2015 |
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*
Philip D. Fracassa |
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Executive Vice President, Chief Financial Officer
(Principal Financial Officer) |
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March 12, 2015 |
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/s/ J. Ted Mihaila
J. Ted Mihaila |
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Senior Vice President and Controller
(Principal Accounting Officer) |
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March 12, 2015 |
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*
Maria A. Crowe |
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Director |
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March 12, 2015 |
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*
John A. Luke, Jr. |
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Director |
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March 12, 2015 |
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*
Christopher L. Mapes |
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Director |
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March 12, 2015 |
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*
Ajita G. Rajendra |
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Director |
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March 12, 2015 |
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*
Joseph W. Ralston |
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Director |
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March 12, 2015 |
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*
John P. Reilly |
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Director |
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March 12, 2015 |
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*
Frank C. Sullivan |
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Director |
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March 12, 2015 |
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*
John M. Timken, Jr. |
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Director |
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March 12, 2015 |
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*
Ward J. Timken, Jr. |
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Director |
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March 12, 2015 |
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*
Jacqueline F. Woods |
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Director |
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March 12, 2015 |
II-5
* |
The undersigned, by signing his name hereto, does hereby sign this Registration Statement on Form S-4 on behalf of each of the officers and directors of the Registrant identified above pursuant to a Power of
Attorney executed by the officers and directors identified above, which Power of Attorney is filed with this Registration Statement on Form S-4 as Exhibit 24.1. |
Dated: March 12, 2015
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By: |
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/s/ J. Ted Mihaila |
Name: |
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J. Ted Mihaila |
Title: |
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Senior Vice President and Controller |
II-6
EXHIBIT INDEX
|
|
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Exhibit No. |
|
Description |
3.1 |
|
Amended Articles of Incorporation of The Timken Company, (effective May 31, 2013) were filed on July 31, 2013 with Form 10-Q (Commission File No. 1-1169) and are incorporated herein by reference. |
|
|
3.2 |
|
Amended Regulations of The Timken Company adopted on February 14, 2014, were filed on February 14, 2014 with Form 8-K (Commission File No. 1-1169) and are incorporated herein by reference. |
|
|
4.1 |
|
Indenture, dated August 20, 2014, by and between The Timken Company and The Bank of New York Mellon Trust Company, N.A., as trustee, was filed on August 20, 2014 with Form 8-K (Commission File No. 1-1169) and is incorporated herein
by reference. |
|
|
5.1 |
|
Opinion of Jones Day. |
|
|
10.1 |
|
Registration Rights Agreement, dated August 20, 2014, by and among The Timken Company, Morgan Stanley & Co. LLC and Deutsche Bank Securities Inc., was filed on August 20, 2014 with Form 8-K (Commission File No. 1-1169) and is
incorporated herein by reference. |
|
|
12.1 |
|
Computation of Ratio of Earnings to Fixed Charges, filed on March 2, 2015 with Form 10-K (Commission File No. 1-1169) and is incorporated herein by reference. |
|
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23.1 |
|
Consent of Independent Registered Public Accounting Firm. |
|
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23.2 |
|
Consent of Jones Day (Included in Exhibit 5.1). |
|
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24.1 |
|
Powers of Attorney. |
|
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25.1 |
|
Form T-1 of The Bank of New York Mellon Trust Company, N.A., under the Trust Indenture Act of 1939. |
|
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99.1 |
|
Form of Letter of Transmittal. |
Exhibit 5.1
NORTH POINT 901 LAKESIDE AVENUE CLEVELAND, OHIO 44114.1190
TELEPHONE: +1.216.586.3939
FACSIMILE: +1.216.579.0212
March 12, 2015
The Timken Company
4500 Mt. Pleasant Street, N.W.
North Canton, Ohio 44720-5450
|
Re: |
Registration Statement on Form S-4 Filed by The Timken Company |
|
|
Relating to the Exchange Offer (as defined below) |
Ladies and Gentlemen:
We have acted as counsel for The Timken Company, an Ohio corporation (the Company), in connection with the
Registration Statement on Form S-4 to which this opinion has been filed as an exhibit (the Registration Statement). The Registration Statement relates to the proposed issuance and exchange
(the Exchange Offer) of up to $350,000,000 aggregate principal amount of 3.875% Senior Notes due 2024 of the Company (the Exchange Notes) for an equal principal amount of 3.875% Senior Notes
due 2024 of the Company outstanding on the date hereof (the Outstanding Notes). The Outstanding Notes have been, and the Exchange Notes will be, issued pursuant to an Indenture, dated as of August 20, 2014 (the
Indenture), by and between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee (the Trustee).
In connection with the opinion expressed herein, we have examined such documents, records and matters of law as we have deemed relevant or
necessary for purposes of such opinion.
Based on the foregoing, and subject to the further limitations, qualifications and assumptions
set forth herein, we are of the opinion that the Exchange Notes, when they are executed by the Company, authenticated by the Trustee in accordance with the Indenture and issued and delivered in exchange for the Outstanding Notes in accordance with
the terms of the Exchange Offer, will constitute valid and binding obligations of the Company.
The opinion set forth above is subject to
the following limitations, qualifications and assumptions:
For purposes of the opinion expressed herein, we have assumed that:
(i) the Trustee has authorized, executed and delivered the Indenture; (ii) the Outstanding Notes have been, and the Exchange Notes will be, duly authenticated by the Trustee in accordance with the Indenture and (iii) the Indenture is
the valid, binding and enforceable obligation of the Trustee.
ALKHOBAR AMSTERDAM
ATLANTA BEIJING BOSTON
BRUSSELS CHICAGO
CLEVELAND COLUMBUS DALLAS
DUBAI DÜSSELDORF FRANKFURT
HONG
KONG HOUSTON IRVINE
JEDDAH LONDON LOS
ANGELES MADRID MEXICO
CITY MIAMI MILAN
MOSCOW MUNICH NEW
YORK PARIS PERTH
PITTSBURGH RIYADH SAN DIEGO SAN FRANCISCO SÃO PAULO SHANGHAI SILICON
VALLEY SINGAPORE SYDNEY
TAIPEI TOKYO WASHINGTON
The Timken Company
March 12,
2015
Page 2
The opinion expressed herein is limited by (i) bankruptcy, insolvency, reorganization, fraudulent transfer and fraudulent conveyance,
voidable preference, moratorium or other similar laws, and related regulations and judicial doctrines from time to time in effect relating to or affecting creditors rights and remedies generally, and (ii) general equitable principles and
public policy considerations, whether such principles and considerations are considered in a proceeding at law or in equity.
The opinion
expressed herein is limited to the laws of the State of New York and the laws of the State of Ohio, in each case as currently in effect, and we express no opinion as to the effect of the laws of any other jurisdiction on the opinion expressed
herein.
We hereby consent to the filing of this opinion as Exhibit 5.1 to the Registration Statement and to the reference to Jones Day
under the caption Legal Matters in the prospectus constituting a part of such Registration Statement. In giving such consent, we do not thereby admit that we are included in the category of persons whose consent is required under
Section 7 of the Securities Act of 1933 or the rules and regulations of the Securities and Exchange Commission promulgated thereunder.
Very truly yours,
/s/ Jones Day
Exhibit 23.1
Consent of Independent Registered Public Accounting Firm
We consent to the reference to our firm under the caption Experts in the Registration Statement (Form S-4 No. 333-00000) and related
Prospectus of The Timken Company for the registration of $350,000,000 aggregate principal amount of its 3.875% Senior Notes due 2024 and to the incorporation by reference therein of our reports dated March 2, 2015, with respect to the
consolidated financial statements and schedule of The Timken Company, and the effectiveness of internal control over financial reporting of The Timken Company, included in its Annual Report (Form 10-K) for the year ended December 31, 2014,
filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Cleveland, Ohio
March 12, 2015
Exhibit 24.1
THE TIMKEN COMPANY
REGISTRATION STATEMENT ON FORM S-4
POWER OF ATTORNEY
KNOW
ALL BY THESE PRESENTS, that each of the undersigned directors and officers of The Timken Company, an Ohio corporation (the Registrant), does hereby constitute and appoint each of Richard G. Kyle, William R. Burkhart, Philip
D. Fracassa and J. Ted Mihaila, or any of them, each acting alone, as the true and lawful attorney-in-fact or attorneys-in-fact for each of the undersigned, with full power of substitution and resubstitution, and in the name, place and stead of each
of the undersigned, to execute and file (i) a Registration Statement on Form S-4 (the Form S-4 Registration Statement) with respect to the registration under the Securities Act of 1933, as amended, for the
exchange of up to $350,000,000 aggregate principal amount of 3.875% of Senior Notes due 2024 of the Registrant, (ii) any and all amendments, including post-effective amendments, supplements and exhibits to the Form S-4 Registration Statement
and (iii) any and all applications or other documents to be filed with the Securities and Exchange Commission or any state securities commission or other regulatory authority or exchange with respect to the securities covered by the Form S-4
Registration Statement, with full power and authority to do and perform any and all acts and things whatsoever necessary, appropriate or desirable to be done in the premises, or in the name, place and stead of the said director and/or officer,
hereby ratifying and approving the acts of said attorneys and any of them and any such substitute.
This Power of Attorney may be executed
in multiple counterparts, each of which will be deemed an original with respect to the person executing it.
IN WITNESS WHEREOF, the
undersigned have hereunto set their hands as of the 16th day of February, 2015.
|
|
|
Signature |
|
Title |
|
|
/s/ Richard G. Kyle
Richard G. Kyle |
|
President and Chief Executive Officer (Principal Executive Officer) and Director |
|
|
/s/ Philip D. Fracassa
Philip D. Fracassa |
|
Executive Vice President and Chief Financial Officer (Principal Financial Officer) |
|
|
/s/ Maria A. Crowe
Maria A. Crowe |
|
Director |
|
|
/s/ John A. Luke, Jr.
John A. Luke, Jr. |
|
Director |
|
|
/s/ Christopher L. Mapes
Christopher L. Mapes |
|
Director |
|
|
/s/ Ajita G. Rajendra
Ajita G. Rajendra |
|
Director |
|
|
/s/ Joseph W. Ralston
Joseph W. Ralston |
|
Director |
|
|
/s/ John P. Reilly
John P. Reilly |
|
Director |
|
|
/s/ Frank C. Sullivan
Frank C. Sullivan |
|
Director |
|
|
/s/ John M. Timken, Jr.
John M. Timken, Jr. |
|
Director |
|
|
/s/ Ward J. Timken, Jr.
Ward J. Timken, Jr. |
|
Director |
|
|
/s/ Jacqueline F. Woods
Jacqueline F. Woods |
|
Director |
Exhibit 25.1
UNITED STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
STATEMENT OF
ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
¨ |
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) |
THE BANK OF
NEW YORK MELLON TRUST COMPANY, N.A.
(Exact name of trustee as specified in its charter)
|
|
|
|
|
95-3571558 |
(Jurisdiction of incorporation or
organization if not a U.S. national bank) |
|
(I.R.S. employer
identification no.) |
|
|
400 South Hope Street, Suite 400
Los Angeles, California |
|
90071 |
(Address of principal executive offices) |
|
(Zip code) |
Legal Department
The Bank of New York Mellon Trust Company, N.A.
One Wall Street
New
York, NY 10286
(212) 635-1089
(Name, address and telephone number of agent for service)
THE TIMKEN COMPANY
(Exact name of obligor as specified in its charter)
|
|
|
Ohio |
|
34-0577130 |
(State or other jurisdiction of
incorporation or organization) |
|
(I.R.S. employer
identification no.) |
|
|
4500 Mt. Pleasant St., N.W.,
North Canton, Ohio |
|
44720-5450 |
(Address of principal executive offices) |
|
(Zip code) |
3.875% Senior Notes due 2024
(Title of the indenture securities)
Item 1. |
General information. |
Furnish the following information as to the trustee:
|
(a) |
Name and address of each examining or supervising authority to which it is subject. |
|
|
|
Name |
|
Address |
Comptroller of the Currency United States Department of the Treasury |
|
Washington, D.C. 20219 |
|
|
Federal Reserve Bank |
|
San Francisco, California 94105 |
|
|
Federal Deposit Insurance Corporation |
|
Washington, D.C. 20429 |
|
(b) |
Whether it is authorized to exercise corporate trust powers. |
Yes.
Item 2. |
Affiliations with Obligor. |
If the obligor is an affiliate of the trustee, describe each
such affiliation.
None.
Item 16. |
List of Exhibits. |
Exhibits identified in parentheses below, on file with the
Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the Act) and 17 C.F.R. 229.10(d).
|
1. |
A copy of the articles of association of The Bank of New York Mellon Trust Company, N.A. (Exhibit 1 to Form T-1 filed with Registration Statement No. 333-135006) |
|
2. |
A copy of certificate of authority of the trustee to commence business. (Exhibit 2 to Form T-1 filed with Registration Statement No. 333-121948). |
|
3. |
A copy of the authorization of the trustee to exercise corporate trust powers. (Exhibit 3 to Form T-1 filed with Registration Statement No. 333-135006). |
|
4. |
A copy of the existing by-laws of the trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-135006). |
|
6. |
The consent of the trustee required by Section 321(b) of the Act. (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-135006). |
|
7. |
A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority. |
SIGNATURE
Pursuant to the requirements of the Act, the trustee, The Bank of New York Mellon Trust Company, N.A., a banking association organized and
existing under the laws of the United States of America, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of Los Angeles, and State of California, on the 12th day
of March, 2015.
|
|
|
THE BANK OF NEW YORK MELLON |
TRUST COMPANY, N.A. |
|
|
By: |
|
/s/ Teresa Petta |
Name: |
|
Teresa Petta |
Title: |
|
Vice President |
EXHIBIT 7
Consolidated Report of Condition of
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.
of 400 South Hope Street, Suite 400, Los Angeles, CA 90071
At the close of business December 31, 2014, published in accordance with Federal regulatory authority instructions.
|
|
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|
|
|
|
Dollar amounts |
|
|
|
in thousands |
|
ASSETS |
|
|
|
|
|
|
Cash and balances due from depository institutions: |
|
|
|
|
Noninterest-bearing balances and currency and coin |
|
|
2,244 |
|
Interest-bearing balances |
|
|
283 |
|
Securities: |
|
|
|
|
Held-to-maturity securities |
|
|
0 |
|
Available-for-sale securities |
|
|
681,797 |
|
Federal funds sold and securities purchased under agreements to resell: |
|
|
|
|
Federal funds sold |
|
|
181,700 |
|
Securities purchased under agreements to resell |
|
|
0 |
|
Loans and lease financing receivables: |
|
|
|
|
Loans and leases held for sale |
|
|
0 |
|
Loans and leases, net of unearned income |
|
|
0 |
|
LESS: Allowance for loan and lease losses |
|
|
0 |
|
Loans and leases, net of unearned income and allowance |
|
|
0 |
|
Trading assets |
|
|
0 |
|
Premises and fixed assets (including capitalized leases) |
|
|
13,215 |
|
Other real estate owned |
|
|
0 |
|
Investments in unconsolidated subsidiaries and associated companies |
|
|
0 |
|
Direct and indirect investments in real estate ventures |
|
|
0 |
|
Intangible assets: |
|
|
|
|
Goodwill |
|
|
856,313 |
|
Other intangible assets |
|
|
103,947 |
|
Other assets |
|
|
117,698 |
|
|
|
|
|
|
Total assets |
|
$ |
1,957,197 |
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
|
|
Deposits: |
|
|
|
|
In domestic offices |
|
|
502 |
|
Noninterest-bearing |
|
|
502 |
|
Interest-bearing |
|
|
0 |
|
Not applicable |
|
|
|
|
Federal funds purchased and securities sold under agreements to repurchase: |
|
|
|
|
Federal funds purchased |
|
|
0 |
|
Securities sold under agreements to repurchase |
|
|
0 |
|
Trading liabilities |
|
|
0 |
|
Other borrowed money: |
|
|
|
|
(includes mortgage indebtedness and obligations under capitalized leases) |
|
|
0 |
|
Not applicable |
|
|
|
|
Not applicable |
|
|
|
|
Subordinated notes and debentures |
|
|
0 |
|
Other liabilities |
|
|
257,630 |
|
Total liabilities |
|
|
258,132 |
|
Not applicable |
|
|
|
|
|
|
EQUITY CAPITAL |
|
|
|
|
|
|
Perpetual preferred stock and related surplus |
|
|
0 |
|
Common stock |
|
|
1,000 |
|
Surplus (exclude all surplus related to preferred stock) |
|
|
1,122,182 |
|
Not available |
|
|
|
|
Retained earnings |
|
|
575,618 |
|
Accumulated other comprehensive income |
|
|
265 |
|
Other equity capital components |
|
|
0 |
|
Not available |
|
|
|
|
Total bank equity capital |
|
|
1,699,065 |
|
Noncontrolling (minority) interests in consolidated subsidiaries |
|
|
0 |
|
Total equity capital |
|
|
1,699,065 |
|
|
|
|
|
|
Total liabilities and equity capital |
|
|
1,957,197 |
|
|
|
|
|
|
I, Matthew J. McNulty, CFO of the above-named bank do hereby declare that the Reports of Condition and Income
(including the supporting schedules) for this report date have been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and are true to the best of my knowledge and belief.
We, the undersigned directors (trustees), attest to the correctness of the Report of Condition (including the
supporting schedules) for this report date and declare that it has been examined by us and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is
true and correct.
|
|
|
|
|
|
|
Antonio I. Portuondo, President |
|
) |
|
|
|
|
William D. Lindelof, Director |
|
) |
|
Directors (Trustees) |
|
|
Alphonse J. Briand, Director |
|
) |
|
|
|
|
Exhibit 99.1
THE TIMKEN COMPANY
LETTER OF TRANSMITTAL
Offer to Exchange Up to $350,000,000
Aggregate Principal Amount of Newly
Issued 3.875% Senior Notes due 2024
(CUSIP No. 887389 AJ3)
For
a Like Principal
Amount of Outstanding
Restricted 3.875% Senior Notes due 2024
Issued on August 20, 2014
(CUSIP Nos. 887389 AH7, U8884G AA3)
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON , 2015, UNLESS
EXTENDED (SUCH DATE, AS THE SAME MAY BE EXTENDED, THE EXPIRATION DATE). ORIGINAL NOTES TENDERED IN THE EXCHANGE OFFER MAY BE WITHDRAWN AT ANY TIME PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE.
The Prospectus, dated , 2015 (the Prospectus), and this
corresponding Letter of Transmittal, relate to the offer of The Timken Company (the Company) to exchange (the Exchange Offer) up to $350,000,000 aggregate principal amount of its 3.875% Senior Notes due 2024 (the
Exchange Notes), which will be issued in a transaction registered under the Securities Act of 1933 (the Securities Act), for a like principal amount of the Companys outstanding restricted 3.875% Senior Notes due 2024
(the Original Notes).
The Original Notes were issued pursuant to an indenture (the Indenture), dated
August 20, 2014, by and between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee (the Trustee).
Capitalized terms used but not defined in this Letter of Transmittal have the meanings provided to them in the Prospectus. All terms and
conditions contained in, or otherwise referred to in, the Prospectus are deemed to be incorporated in, and form a part of, this Letter of Transmittal. Therefore you are urged to carefully read the Prospectus and the items referred to therein. The
terms and conditions contained in the Prospectus, together with the terms and conditions governing this Letter of Transmittal and the instructions herein, are collectively referred to herein as the terms and conditions.
The exchange agent for the Exchange Offer is:
The Bank of New York Mellon Trust Company, N.A.
Questions relating to the procedure for tendering, as well as requests for additional copies of the Prospectus or this Letter of Transmittal,
should be directed to the exchange agent addressed as follows:
By Hand, Overnight Delivery or Mail (Registered
or Certified Mail Recommended):
The Bank of New York Mellon Trust Company, N.A.
111 Sanders Creek Parkway
East
Syracuse, New York 13057
E-mail: dacia.brown@bnymellon.com
Facsimile: (732) 667-9408
Attention: Corporate Trust Reorg
This Letter of Transmittal is to be used by Holders of the Original Notes. Tenders of Original
Notes are to be made using the Automated Tender Offer Program (ATOP) of The Depository Trust Company (DTC) pursuant to the procedures set forth in the Prospectus under the caption The Exchange Offer Procedures
for Tendering Original Notes. DTC participants that are accepting the Exchange Offer must transmit their acceptance to DTC, which will verify the acceptance and execute a book-entry delivery to the exchange agents DTC account. DTC will
then send a computer-generated message known as an agents message to the exchange agent for its acceptance. For you to validly tender your Original Notes in the Exchange Offer, the exchange agent must receive, prior to the
Expiration Date, an agents message under the ATOP procedures that confirms that:
|
|
|
DTC has received your instructions to tender your Original Notes; and |
|
|
|
you agree to be bound by the terms and conditions of this Letter of Transmittal. |
By using the
ATOP procedures to tender Original Notes, you will not be required to deliver this Letter of Transmittal to the exchange agent. However, you will be bound by its terms and conditions, and you will be deemed to have made the acknowledgments and the
representations and warranties it contains, just as if you had signed it. The tender of Original Notes by you pursuant to the procedures set forth in this Letter of Transmittal and the Prospectus will constitute an agreement between you and us in
accordance with the terms and subject to the conditions set forth in this Letter of Transmittal and the Prospectus. If you have questions or need help, or if you would like additional copies of the Prospectus and this Letter of Transmittal, you
should contact the exchange agent at its telephone number or address set forth above.
The Exchange Notes will be issued in full exchange
for Original Notes in the Exchange Offer, if consummated, on the exchange date and will be delivered in book-entry form.
As used in this
Letter of Transmittal, the term Holder means any person in whose name Original Notes are held of record by DTC and who desires to deliver such notes by book-entry transfer at DTC.
2
Please read the accompanying instructions carefully.
Ladies and Gentlemen:
According to the terms
and conditions of the Exchange Offer, I hereby tender to the Company the principal amount of Original Notes credited by me to the exchange agents account at DTC using ATOP. At the time these notes are accepted by the Company and exchanged for
the same principal amount of Exchange Notes, I will sell, assign and transfer to the Company all right, title and interest in and to the Original Notes I have tendered. I am aware that the exchange agent also acts as the agent of the Company.
Upon agreement to the terms and conditions of this document pursuant to an agents message, I irrevocably constitute and appoint the exchange agent as my agent and attorney-in-fact for the tendered Original Notes with full power of substitution
to:
|
|
|
cause the Original Notes to be assigned, transferred and exchanged; |
|
|
|
transfer ownership of the Original Notes on the account books maintained by DTC, to the Company and deliver all accompanying evidences of transfer and authenticity to the Company; and |
|
|
|
present the Original Notes for transfer on the books of the Company, receive all benefits and exercise all rights of beneficial ownership of these Original Notes according to the terms and conditions of the Exchange
Offer. The power of attorney granted in this paragraph is irrevocable and coupled with an interest. |
With respect to the
each series of Original Notes, I represent and warrant that I have full power and authority to tender, exchange, assign and transfer the Original Notes that I am tendering and to acquire Exchange Notes issuable upon the exchange of the tendered
Original Notes. I represent and warrant that the Company will acquire good and unencumbered title to such Original Notes, free and clear of all liens, restrictions, other than restrictions on transfer, charges and encumbrances, and that such
Original Notes are not and will not be subject to any adverse claim at the time the Company acquires them. I further represent that:
|
|
|
I am not an affiliate (as defined in Rule 405 under the Securities Act) of the Company or its subsidiaries, or, if I am an affiliate of the Company or its subsidiaries, I will comply with the
registration and prospectus delivery requirements of the Securities Act to the extent applicable; |
|
|
|
any Exchange Notes I will acquire in exchange for the Original Notes I have tendered will be acquired in the ordinary course of business; |
|
|
|
I have not entered into, engaged in, do not intend to engage in, and have no arrangement or understanding with any person to engage in, a distribution of any Exchange Notes issued to me; |
|
|
|
I am not a broker-dealer who purchased the Original Notes for resale pursuant to an exemption under the Securities Act tendering Original Notes acquired directly from the Company for my own account; and
|
|
|
|
I am not restricted by any law or policy of the U.S. Securities and Exchange Commission (the SEC) from trading the Exchange Notes acquired in the Exchange Offer. |
I understand that the Exchange Offer is being made in reliance on interpretations contained in letters issued to third parties by the staff of
the SEC. These letters provide that the Exchange Notes issued in exchange for the Original Notes in the Exchange Offer may be offered for resale, resold, and otherwise transferred by a Holder of Exchange Notes, unless that person is an
affiliate of the Company within the meaning of Rule 405 under the Securities Act, without compliance with the registration and prospectus delivery provisions of the Securities Act. The Exchange Notes must be acquired in the ordinary
course of the Holders business and the Holder must not be engaging in, must not intend to engage in, and must not have any arrangement or understanding with any person to participate in, a distribution of the Exchange Notes.
If I am a broker-dealer that will receive Exchange Notes for my own account in exchange for Original Notes that were acquired as a result of
market-making activities or other trading activities, I acknowledge that I will
3
deliver the Prospectus in connection with any resale of the Exchange Notes. However, by this acknowledgment and by delivering the Prospectus, I will not be deemed to admit that I am an
underwriter within the meaning of the Securities Act.
Upon request, I will execute and deliver any additional documents
deemed by the exchange agent or the Company to be necessary or desirable to complete the exchange, assignment and transfer of the Original Notes I have tendered.
I understand that the Company will be deemed to have accepted validly tendered Original Notes when and if the Company gives written notice of
acceptance to the exchange agent and such acceptance will constitute performance in full by the Company of its obligations under the applicable registration rights agreement, except in the limited circumstances defined in such agreement.
If, for any reason, any tendered Original Notes are not accepted for exchange in the Exchange Offer, the unaccepted Original Notes will be
returned without expense to the tendering Holder. Such non-exchanged Original Notes will be credited to an account maintained with DTC. These actions will occur as promptly as practicable after the expiration or termination of the Exchange Offer.
All authority granted or agreed to be granted by this Letter of Transmittal will survive my death, bankruptcy or incapacity, and every
obligation under this Letter of Transmittal is binding upon my heirs, legal representatives, successors, assigns, executors, administrators and trustees in bankruptcy.
I understand that tenders of Original Notes according to the procedures described in the Prospectus under the heading The Exchange Offer
Procedures for Tendering Original Notes and in the instructions included in this Letter of Transmittal constitute a binding agreement between myself and the Company subject to the terms and conditions of the Exchange Offer.
¨ CHECK HERE IF YOU ARE A BROKERDEALER AND WISH TO RECEIVE 10 ADDITIONAL
COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO.
Name:
Address:
Name of Tendering
Institution:
Account Number:
Transaction Code Number:
By crediting the Original Notes to the exchange agents account at DTC using ATOP and by complying with applicable ATOP procedures with
respect to the Exchange Offer, the participant in DTC confirms on behalf of itself and the beneficial owners of such Original Notes all provisions of this Letter of Transmittal (including all representations and warranties) applicable to it and such
beneficial owner.
4
INSTRUCTIONS FORMING PART OF
THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER
1. BOOK-ENTRY CONFIRMATIONS. Any confirmation of a book-entry transfer to the exchange agents account at DTC of
Original Notes tendered by book-entry transfer, as well as an agents message, and any other documents required by this Letter of Transmittal, must be received by the exchange agent at its address set forth on the cover page of this Letter of
Transmittal prior to 5:00 P.M., New York City time, on the Expiration Date.
THE COMPANY WILL NOT ACCEPT ANY ALTERNATIVE, CONDITIONAL OR
CONTINGENT TENDERS. EACH TENDERING HOLDER BY DELIVERY OF AN AGENTS MESSAGE WAIVES ANY RIGHT TO RECEIVE ANY NOTICE OF THE ACCEPTANCE OF SUCH TENDER.
2. VALIDITY OF TENDERS. The Company has the sole right to decide any questions about the validity, form, eligibility, time of receipt,
acceptance or withdrawal of tendered Original Notes, and its decision will be final and binding. The Companys interpretation of the terms and conditions of the Exchange Offer, including the instructions contained in this Letter of Transmittal
and in the Prospectus, will be final and binding on all parties.
The Company has the absolute right to reject any or all of the tendered
Original Notes if:
|
|
|
the Original Notes are not properly tendered; or |
|
|
|
in the opinion of counsel, the acceptance of those Original Notes would be unlawful. |
The
Company may also decide to waive any conditions of the Exchange Offer or any defects or irregularities of tenders of Original Notes and accept such Original Notes for exchange whether or not similar defects or irregularities are waived in the case
of other Holders. Any defect or irregularity in the tender of Original Notes that is not waived by the Company must be cured within the period of time set by the Company.
It is your responsibility to identify and cure any defect or irregularity in the tender of your Original Notes. Your tender of Original Notes
will not be considered to have been made until any defect or irregularity is cured or waived. Neither the Company, the exchange agent nor any other person is required to notify you that your tender was defective or irregular, and no one will be
liable for any failure to notify you of such a defect or irregularity in your tender of Original Notes. Tenders of the Original Notes will not be deemed made until such defects or irregularities have been cured or waived. Any Original Notes received
by the exchange agent that are not properly tendered and as to which the defects or irregularities have not been cured or waived will be returned to the tendering Holder as soon as practicable after the Expiration Date of the Exchange Offer.
3. PARTIAL TENDERS. Tenders of Original Notes pursuant to the Exchange Offer will be accepted only in principal amounts equal to
$2,000 and integral multiples of $1,000. Any untendered Original Notes and any Exchange Notes issued in exchange for tendered and accepted Original Notes will be credited to accounts at DTC.
4. TRANSFER TAXES. The Company will pay all transfer taxes, if any, applicable to the exchange of Original Notes in the Exchange
Offer. However, transfer taxes will be payable by you (or by the tendering Holder if you are delivering this letter on behalf of a tendering Holder) if a transfer tax is imposed for any reason other than the exchange of Original Notes according to
the Exchange Offer. If satisfactory evidence of the payment of those taxes or an exemption from payment is not submitted with this Letter of Transmittal or at the time the related agents message is delivered, the amount of those transfer taxes
will be billed directly to the tendering Holder. Until those transfer taxes are paid, the Company will not be required to deliver any Exchange Notes required to be delivered to, or at the direction of, such tendering Holder.
Except as provided in this Instruction 4, it is not necessary for transfer tax stamps to be attached to the Original Notes listed in this
Letter of Transmittal.
5. WAIVER OF CONDITIONS. The Company may choose, at any time and for any reason, to waive
or, subject to certain requirements, amend or modify certain of the conditions to the Exchange Offer. The conditions applicable to tenders of Original Notes in the Exchange Offer are described in the Prospectus under the heading The Exchange
Offer Conditions to the Exchange Offer.
6. WITHDRAWAL RIGHTS. Original Notes tendered pursuant to the Exchange Offer
may be withdrawn at any time prior to 5:00 P.M., New York City time, on the Expiration Date. For a withdrawal to be effective, a written letter or facsimile transmission notice of withdrawal must be received by the exchange agent at its address set
forth in this Letter of Transmittal not later than 5:00 P.M., New York City time, on the Expiration Date. Any notice of withdrawal must specify the name and number of the account at DTC to be credited with withdrawn Original Notes and otherwise
comply with the ATOP procedures. The exchange agent will return properly withdrawn Original Notes promptly following receipt of notice of withdrawal. Properly withdrawn Original Notes may be retendered by following the procedures described in the
Prospectus under the heading The Exchange Offer Procedures for Tendering Original Notes above at any time on or prior to 5:00 P.M., New York City time, on the Expiration Date. All questions as to the validity of notices of
withdrawals, including time of receipt, will be determined by the Company, and will be final and binding on all parties.
7. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. If you have questions, need assistance or would like to receive additional copies
of the Prospectus or this Letter of Transmittal, you should contact the exchange agent at the address listed on the cover page of this document. You may also contact your broker, dealer, commercial bank, trust company or other nominee for assistance
concerning the Exchange Offer.
IMPORTANT: BY USING THE ATOP PROCEDURES TO TENDER ORIGINAL NOTES, YOU WILL NOT BE REQUIRED TO DELIVER
THIS LETTER OF TRANSMITTAL TO THE EXCHANGE AGENT. HOWEVER, YOU WILL BE BOUND BY ITS TERMS AND CONDITIONS, AND YOU WILL BE DEEMED TO HAVE MADE THE ACKNOWLEDGMENTS AND THE REPRESENTATIONS AND WARRANTIES IT CONTAINS, JUST AS IF YOU HAD SIGNED IT.
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