e424b5
The
information in this preliminary prospectus supplement is not
complete and may be changed. This preliminary prospectus
supplement and the accompanying prospectus are not an offer to
sell these securities and we are not soliciting an offer to buy
these securities in any jurisdiction where the offer or sale is
not permitted.
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Filed Pursuant to
Rule 424 (B)(5)
Registration
Number 333-173118
Subject to Completion, Dated
March 28, 2011
Preliminary Prospectus Supplement to Prospectus Dated March 28,
2011
8,700,000 Shares
The Goodyear Tire &
Rubber Company
%
Mandatory Convertible Preferred Stock
We are offering to sell 8,700,000 shares of
our % mandatory convertible
preferred stock through this prospectus supplement and the
accompanying prospectus.
Quarterly dividends on each share of the mandatory convertible
preferred stock will accrue at a rate
of % per year on the initial
liquidation preference of $50.00 per share (equivalent to
$ per annum per share). Dividends
will accrue and accumulate from the date of issuance and, to the
extent that we are legally permitted to pay a dividend and our
board of directors or an authorized committee of our board of
directors declares a dividend payable, we will pay dividends in
cash on January 1, April 1, July 1 and
October 1 of each year through, and including,
April 1, 2014. The initial dividend will be payable on
July 1, 2011.
Each share of the mandatory convertible preferred stock has a
liquidation preference of $50.00, plus an amount equal to the
sum of all accrued and unpaid dividends.
Each share of the mandatory convertible preferred stock will
automatically convert on April 1, 2014 into
between
and shares
of our common stock, subject to adjustment as described herein,
depending on the average VWAP (as defined herein) per share of
our common stock for the 20 consecutive
trading-day
period ending on, and including, the third trading day
immediately preceding the mandatory conversion date. At any time
prior to April 1, 2014, holders may elect to convert shares
of the mandatory convertible preferred stock at the minimum
conversion rate
of shares
of our common stock, subject to adjustment as described herein.
During a specified period, in connection with a fundamental
change (as defined herein) that occurs prior to the mandatory
conversion date, holders may convert their shares of mandatory
convertible preferred stock into a number of shares of our
common stock equal to the applicable fundamental change
conversion rate (as defined herein). If we at any time have not
paid the equivalent of six full quarterly dividends (whether or
not consecutive and whether or not earned or declared) on any
series of our preferred stock at the time outstanding, including
the mandatory convertible preferred stock, we may, at our
option, cause all, but not less than all, outstanding shares of
the mandatory convertible preferred stock to be automatically
converted into a number of shares of our common stock based on
the fundamental change conversion rate (as described above).
Upon conversion, we will also pay converting holders the sum of
an amount in cash equal to all accrued and unpaid dividends,
whether or not previously declared, on the converted shares of
mandatory convertible preferred stock and, in the case of a
conversion upon a fundamental change or a conversion following
nonpayment of dividends only, the present value of all remaining
dividend payments on the converted shares of mandatory
convertible preferred stock.
Prior to this offering, there has been no public market for the
mandatory convertible preferred stock. We have applied to list
the mandatory convertible preferred stock on the New York Stock
Exchange under the symbol GTPrA. Our common stock is
listed on the New York Stock Exchange under the symbol
GT. The last reported sale price of our common stock
on March 25, 2011 was $15.45 per share.
Investing in our mandatory convertible preferred stock
involves risks. See Risk Factors on
page S-11
of this prospectus supplement.
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Per Share
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Total
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Public offering price
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$
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$
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Underwriting discounts and commissions
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$
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$
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Proceeds, before expenses, to us
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$
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$
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The underwriters may also purchase up to an additional
1,300,000 shares of the mandatory convertible preferred
stock from us at the public offering price, less the
underwriting discount, within 30 days following the date of
this prospectus supplement.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or passed upon the adequacy or accuracy of this
prospectus supplement or the accompanying prospectus. Any
representation to the contrary is a criminal offense.
The underwriters expect to deliver the shares of the mandatory
convertible preferred stock against payment in New York, New
York on or
about ,
2011.
Joint Book-Running Managers
Co-Managers
The date of this prospectus supplement
is ,
2011.
TABLE OF
CONTENTS
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Prospectus Supplement
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S-ii
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S-iii
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S-iii
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S-iv
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S-1
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S-11
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S-19
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S-20
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S-21
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S-22
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S-24
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S-25
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S-50
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S-54
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S-59
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S-64
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S-64
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Prospectus
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About this Prospectus
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1
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Where You Can Find More Information
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2
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Incorporation of Certain Documents by Reference
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2
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Forward-Looking Information Safe Harbor Statement
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3
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The Company
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5
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Risk Factors
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5
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Use of Proceeds
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5
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Ratio of Earnings to Combined Fixed Charges and Preferred
Dividends
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6
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Description of Capital Stock
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7
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Plan of Distribution
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8
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Legal Matters
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9
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Experts
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9
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In making your investment decision, you should rely only on the
information contained in or incorporated by reference into this
prospectus supplement, the accompanying prospectus or any other
offering material filed or provided by us. We have not, and the
underwriters have not, authorized any other person to provide
you with different information. If anyone provides you with
different or inconsistent information, you should not rely
on it.
We and the underwriters are not making an offer to sell these
securities in any jurisdiction where the offer or sale is not
permitted.
You should not assume that the information contained in this
prospectus supplement, the accompanying prospectus or any other
offering material is accurate as of any date other than the date
on the front of such document. Any information incorporated by
reference into this prospectus supplement, the accompanying
prospectus or any other offering material is accurate only as of
the date of the document incorporated by reference. Our
business, financial condition, results of operations and
prospects may have changed since that date.
S-i
ABOUT THIS
PROSPECTUS SUPPLEMENT
This prospectus supplement and the accompanying prospectus are
part of a registration statement that we filed with the
Securities and Exchange Commission, or SEC, utilizing a
shelf registration process. In this prospectus
supplement, we provide you with specific information about the
shares of our mandatory convertible preferred stock that we are
selling in this offering and about the offering itself. Both
this prospectus supplement and the accompanying prospectus
include or incorporate by reference important information about
us, our mandatory convertible preferred stock and other
information you should know before investing in our mandatory
convertible preferred stock. This prospectus supplement also
adds, updates and changes information contained in or
incorporated by reference into the accompanying prospectus. To
the extent that any statement that we make in this prospectus
supplement is inconsistent with the statements made in the
accompanying prospectus, the statements made in the accompanying
prospectus are deemed modified or superseded by the statements
made in this prospectus supplement. You should read both this
prospectus supplement and the accompanying prospectus as well as
additional information described under Incorporation of
Certain Documents by Reference before investing in our
mandatory convertible preferred stock.
S-ii
WHERE YOU CAN
FIND MORE INFORMATION
We are subject to the information reporting requirements of the
Securities Exchange Act of 1934, as amended, and, accordingly,
we file annual, quarterly and current reports, proxy statements
and other information with the SEC. Our SEC filings are
available at the SECs website
(http://www.sec.gov)
or through our website
(http://www.goodyear.com).
We have not incorporated by reference into this prospectus
supplement the information included on or linked from our
website, and you should not consider it part of this prospectus
supplement. You may also read and copy any document we file with
the SEC at its Public Reference Room at 100 F Street,
N.E., Washington, D.C. 20549. You may also obtain copies of
the documents at prescribed rates from the Public Reference Room
of the SEC. You may call the SEC at
1-800-SEC-0330
for further information on the operation of the Public Reference
Room. Our SEC filings are also available at the offices of the
New York Stock Exchange, 20 Broad Street, New York, NY
10005.
INCORPORATION OF
CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to incorporate by reference
documents that we file with the SEC into this prospectus
supplement, which means that we can disclose important
information to you by referring you to those documents. The
information incorporated by reference into this prospectus
supplement is considered part of this prospectus supplement. Any
statement in this prospectus supplement or incorporated by
reference into this prospectus supplement shall be automatically
modified or superseded for purposes of this prospectus
supplement to the extent that a statement contained herein or in
a subsequently filed document that is incorporated by reference
into this prospectus supplement modifies or supersedes such
prior statement. Any statement so modified or superseded shall
not be deemed, except as so modified or superseded, to
constitute a part of this prospectus supplement.
We incorporate by reference the following documents that have
been filed with the SEC (other than any portion of such filings
that are furnished under applicable SEC rules rather than filed):
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Annual Report on
Form 10-K
for the year ended December 31, 2010;
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Definitive Proxy Statement on Schedule 14A filed on
March 8, 2011;
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Current Report on
Form 8-K
filed on February 22, 2011; and
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Our Registration Statement on Form 10 describing our common
stock and all amendments and reports filed for the purpose of
updating such description, including the Current Report on
Form 8-K filed on March 28, 2011.
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All documents and reports that we file with the SEC (other than
any portion of such filings that are furnished under applicable
SEC rules rather than filed) under Sections 13(a), 13(c),
14 or 15(d) of the Securities Exchange Act of 1934, as amended,
from the date of this prospectus supplement until the
termination of the offering of all securities under this
prospectus supplement, shall be deemed to be incorporated into
this prospectus supplement by reference. The information
contained on our website
(http://www.goodyear.com)
is not incorporated into this prospectus supplement.
You may request a copy of any documents incorporated by
reference herein at no cost by writing or telephoning us at:
The Goodyear
Tire & Rubber Company
1144 East Market Street
Akron, Ohio
44316-0001
Attention: Investor Relations
Telephone number:
330-796-3751
Exhibits to the filings will not be sent, however, unless those
exhibits have specifically been incorporated by reference into
this prospectus supplement.
S-iii
FORWARD-LOOKING
INFORMATION SAFE HARBOR STATEMENT
Certain information set forth herein or incorporated by
reference herein may constitute forward-looking statements
regarding events and trends that may affect our future operating
results and financial position. The words estimate,
expect, intend and project,
as well as other words or expressions of similar meaning, are
intended to identify forward-looking statements. You are
cautioned not to place undue reliance on forward-looking
statements, which speak only as of the date of this prospectus
supplement or, in the case of information incorporated by
reference herein, as of the date of the document in which such
information appears. Such statements are based on current
expectations and assumptions, are inherently uncertain, are
subject to risks and should be viewed with caution. Actual
results and experience may differ materially from the
forward-looking statements as a result of many factors,
including:
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if we do not achieve projected savings from various cost
reduction initiatives or successfully implement other strategic
initiatives our operating results, financial condition and
liquidity may be materially adversely affected;
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higher raw material and energy costs may materially adversely
affect our operating results and financial condition;
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our pension plans are significantly underfunded and further
increases in the underfunded status of the plans could
significantly increase the amount of our required contributions
and pension expense;
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we face significant global competition, increasingly from lower
cost manufacturers, and our market share could decline;
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deteriorating economic conditions in any of our major markets,
or an inability to access capital markets or third-party
financing when necessary, may materially adversely affect our
operating results, financial condition and liquidity;
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the challenges of the present business environment may cause a
material reduction in our liquidity as a result of an adverse
change in our cash flow from operations;
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work stoppages, financial difficulties or supply disruptions at
our major original equipment customers, dealers or suppliers
could harm our business;
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our capital expenditures may not be adequate to maintain our
competitive position and may not be implemented in a timely or
cost-effective manner;
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if we experience a labor strike, work stoppage or other similar
event our financial position, results of operations and
liquidity could be materially adversely affected;
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our long term ability to meet current obligations and to repay
maturing indebtedness is dependent on our ability to access
capital markets in the future and to improve our operating
results;
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we have a substantial amount of debt, which could restrict our
growth, place us at a competitive disadvantage or otherwise
materially adversely affect our financial health;
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any failure to be in compliance with any material provision or
covenant of our secured credit facilities could have a material
adverse effect on our liquidity and our results of operations;
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our international operations have certain risks that may
materially adversely affect our operating results;
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we have foreign currency translation and transaction risks that
may materially adversely affect our operating results;
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our variable rate indebtedness subjects us to interest rate
risk, which could cause our debt service obligations to increase
significantly;
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S-iv
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we have substantial fixed costs and, as a result, our operating
income fluctuates disproportionately with changes in our net
sales;
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we may incur significant costs in connection with product
liability and other tort claims;
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our reserves for product liability and other tort claims and our
recorded insurance assets are subject to various uncertainties,
the outcome of which may result in our actual costs being
significantly higher than the amounts recorded;
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we may be required to provide letters of credit or post cash
collateral if we are subject to a significant adverse judgment
or if we are unable to obtain surety bonds, which may have a
material adverse effect on our liquidity;
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we are subject to extensive government regulations that may
materially adversely affect our operating results;
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the terms and conditions of our global alliance with Sumitomo
Rubber Industries, Ltd., or SRI, provide for certain exit rights
available to SRI upon the occurrence of certain events, which
could require us to make a substantial payment to acquire
SRIs minority interests in our European and North American
joint ventures following the determination of the fair value of
those interests;
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if we are unable to attract and retain key personnel, our
business could be materially adversely affected; and
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we may be impacted by economic and supply disruptions associated
with events beyond our control, such as war, acts of terror,
political unrest, public health concerns, labor disputes or
natural disasters.
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It is not possible to foresee or identify all such factors. We
will not revise or update any forward-looking statement or
disclose any facts, events or circumstances that occur after the
date hereof that may affect the accuracy of any forward-looking
statement.
S-v
SUMMARY
The following summary contains basic information about this
offering. It may not contain all of the information that is
important to you and it is qualified in its entirety by the more
detailed information included in or incorporated by reference
into this prospectus supplement and the accompanying prospectus.
You should carefully consider the information contained in and
incorporated by reference into this prospectus supplement and
the accompanying prospectus, including the information set forth
under the heading Risk Factors in this prospectus
supplement and the accompanying prospectus. In addition, certain
statements include forward-looking information that involves
risks and uncertainties. See Forward-Looking
Information Safe Harbor Statement.
The terms Goodyear, Company and
we, us or our wherever used
herein refer to The Goodyear Tire & Rubber Company
together with all of its consolidated domestic and foreign
subsidiary companies, unless otherwise indicated or the context
otherwise requires.
Overview of
Goodyear
We are one of the worlds leading manufacturers of tires,
engaging in operations in most regions of the world. For the
year ended December 31, 2010, our net sales were
$18.8 billion and Goodyears net loss was
$216 million. Together with our U.S. and international
subsidiaries and joint ventures, we develop, manufacture, market
and distribute tires for most applications. We also manufacture
and market rubber-related chemicals for various applications. We
are one of the worlds largest operators of commercial
truck service and tire retreading centers. In addition, we
operate approximately 1,500 tire and auto service center outlets
where we offer our products for retail sale and provide
automotive repair and other services. We manufacture our
products in 56 manufacturing facilities in 22 countries,
including the United States, and we have marketing operations in
almost every country around the world. As of December 31,
2010, we employed approximately 72,000 full-time and
temporary associates worldwide.
We operate our business through four operating segments
representing our regional tire businesses: North American Tire;
Europe, Middle East and Africa Tire; Latin American Tire; and
Asia Pacific Tire. Our principal business is the development,
manufacture, distribution and sale of tires and related products
and services worldwide. We manufacture and market numerous lines
of rubber tires for:
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automobiles
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trucks
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buses
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aircraft
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motorcycles
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farm implements
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earthmoving and mining equipment
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industrial equipment, and
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various other applications.
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In each case, our tires are offered for sale to vehicle
manufacturers for mounting as original equipment and for
replacement worldwide. We manufacture and sell tires under the
Goodyear, Dunlop, Kelly, Fulda, Debica and Sava brands and
various other Goodyear owned house brands, and the
private-label brands of certain customers. In certain geographic
areas we also:
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retread truck, aviation and
off-the-road,
or OTR, tires,
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S-1
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manufacture and sell tread rubber and other tire retreading
materials,
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provide automotive repair services and miscellaneous other
products and services, and
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manufacture and sell flaps for truck tires and other types of
tires.
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Our principal products are new tires for most applications.
Approximately 84% of our sales in 2010 were for new tires,
compared to 83% in 2009 and 82% in 2008. New tires are sold
under highly competitive conditions throughout the world. On a
worldwide basis, we have two major competitors: Bridgestone
(based in Japan) and Michelin (based in France). Other
significant competitors include Continental, Cooper, Hankook,
Kumho, Pirelli, Toyo, Yokohama and various regional tire
manufacturers.
We compete with other tire manufacturers on the basis of product
design, performance, price and terms, reputation, warranty
terms, customer service and consumer convenience. Goodyear and
Dunlop brand tires enjoy a high recognition factor and have a
reputation for performance and quality. The Kelly, Debica, Sava
and Fulda brands and various other house brand tire lines
offered by us, and tires manufactured and sold by us to private
brand customers, compete primarily on the basis of value and
price.
We are an Ohio corporation, organized in 1898. Our principal
executive offices are located at 1144 East Market Street, Akron,
Ohio 44316. Our telephone number is
(330) 796-2121.
S-2
The
Offering
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Issuer |
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The Goodyear Tire & Rubber Company |
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Securities Offered |
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8,700,000 shares of %
mandatory convertible preferred stock (10,000,000 shares if
the underwriters exercise their option to purchase additional
shares in full) |
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Initial Offering Price |
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$50.00 for each share of mandatory convertible preferred stock |
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Option to purchase additional shares of mandatory convertible
preferred stock |
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We have granted the underwriters an option to purchase up to an
additional 1,300,000 shares of the mandatory convertible
preferred stock from us at the public offering price, less the
underwriting discount, within 30 days following the date of
this prospectus supplement. |
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Dividends |
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% per share on the initial
liquidation preference of $50.00 for each share of our mandatory
convertible preferred stock per year. Dividends will be payable
quarterly, and will accumulate commencing on the date of
issuance and ending on April 1, 2014. To the extent that we
are legally permitted to pay a dividend and our board of
directors declares a dividend payable, we will pay dividends in
cash on each dividend payment date. The initial dividend for the
first dividend period is expected to be
$ per share. Each subsequent
quarterly dividend, when and if declared, will be
$ per share. See Description
of Mandatory Convertible Preferred Stock
Dividends. |
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The terms of our senior secured credit facilities and certain of
our outstanding debt securities may restrict our ability to
declare or pay dividends or distributions on our capital stock,
including the mandatory convertible preferred stock. Our ability
to declare and pay dividends may also be limited by Ohio law.
See Risk Factors We may not be able to pay
cash dividends on the mandatory convertible preferred
stock. |
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Dividend Payment Dates |
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If declared, dividends will be payable quarterly on
January 1, April 1, July 1 and October 1 of
each year (or the next business day if the applicable date is
not a business day), commencing on July 1, 2011 and ending
on April 1, 2014. |
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Redemption |
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The mandatory convertible preferred stock is not redeemable. |
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Mandatory Conversion Date |
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April 1, 2014 |
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Mandatory Conversion |
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On the mandatory conversion date, each share of the mandatory
convertible preferred stock, unless previously converted, will
automatically convert into a number of shares of our common
stock based on the applicable conversion rate described below. |
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In addition, we will pay holders, for each share of mandatory
convertible preferred stock they convert, an amount in cash
equal to the amount of all accrued and unpaid dividends, |
S-3
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whether or not declared prior to that date, for the then-current
dividend period ending on the mandatory conversion date and all
prior dividend periods (other than previously declared dividends
on the mandatory convertible preferred stock that were paid to
holders of record as of a prior date), so long as we are
lawfully permitted to pay such amount at such time. If we fail
to pay such cash amount for any reason, the conversion rate
applicable to such conversion will be adjusted as described
under Description of Mandatory Convertible Preferred
Stock Conversion Rate Adjustments
Adjustment to Conversion Rate Upon Conversion and the
converting holders right to receive such amount shall be
extinguished upon conversion. |
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Conversion Rate Upon Mandatory Conversion |
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The conversion rate for each share of mandatory convertible
preferred stock will not be more
than shares
and not less
than shares
of our common stock, depending on the applicable market value of
our common stock, as set forth below: |
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if the applicable market value of our common stock
is equal to or greater than the threshold appreciation price of
$ , then the conversion rate will
be shares
of our common stock per share of mandatory convertible preferred
stock, which is equal to $50.00 divided by the threshold
appreciation price;
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if the applicable market value of our common stock
is less than the threshold appreciation price of
$ , but greater than the initial
price of $ , then the conversion
rate will be equal to $50.00 divided by the applicable market
value of our common stock; or
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if the applicable market value of our common stock
is less than or equal to the initial price of
$ , then the conversion rate will
be shares
of common stock per share of mandatory convertible preferred
stock, which is equal to $50.00 divided by the initial price.
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The applicable market value of our common stock is
the average of the volume weighted average price of our common
stock for the 20 consecutive trading-day period ending on, and
including, the third trading day immediately preceding the
mandatory conversion date. |
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The conversion rate is subject to certain adjustments as
described under Description of Mandatory Convertible
Preferred Stock Conversion Rate Adjustments. |
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The number of shares of our common stock delivered upon any
conversion of the mandatory convertible preferred stock (whether
mandatory conversion, early conversion at the option of the
holder, conversion at the option of the holder upon a
fundamental change or conversion upon nonpayment of dividends),
including the number of shares delivered in connection with any
payment of accrued and unpaid dividends or remaining dividends,
shall in no event exceed an amount per |
S-4
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share of our mandatory convertible preferred stock (the
share cap) equal to the product of
(i) and
(ii) the maximum conversion rate, subject to adjustment as
described under Description of Mandatory Convertible
Preferred Stock Conversion Rate Adjustments. |
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Conversion at the Option of the Holder |
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Prior to April 1, 2014, holders may elect to convert each
share of mandatory convertible preferred stock into shares of
our common stock, subject to certain adjustments as described
under Description of Mandatory Convertible Preferred Stock
Conversion Rate Adjustments. We will also pay
converting holders an amount in cash equal to all accrued and
unpaid dividends on each converted share of mandatory
convertible preferred stock, whether or not declared prior to
that date, for all dividend periods ending on or prior to the
dividend payment date immediately preceding the early conversion
date (other than previously declared dividends on the mandatory
convertible preferred stock that were paid to holders of record
as of a prior date), so long as we are legally permitted to pay
such amount at such time. If we fail to pay such cash amount for
any reason, the conversion rate applicable to such conversion
will be adjusted as described under Description of
Mandatory Convertible Preferred Stock Conversion
Rate Adjustments Adjustment to Conversion Rate Upon
Conversion and the converting holders right to
receive such amount shall be extinguished upon conversion. |
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Conversion Upon Fundamental Change |
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Prior to the mandatory conversion date, if we undergo certain
specified fundamental change events, holders may convert their
shares of mandatory convertible preferred stock into (i) a
number of shares of our common stock (or units of exchange
property, if applicable) based on the conversion rate described
above under Conversion Rate Upon Mandatory
Conversion treating the effective date of the fundamental
change as the mandatory conversion date for the purpose of such
determination; and (ii) a number of additional shares of
our common stock (or units of exchange property, if applicable)
determined by reference to the effective date of the fundamental
change and the price per share of our common stock on the
effective date of the fundamental change as described under
Description of Mandatory Convertible Preferred
Stock Conversion Upon Fundamental Change (the
conversion rate determined in accordance with clause (i), as
increased for any such additional shares, is referred to as the
fundamental change conversion rate). This conversion
rate is subject to certain adjustments as described under
Description of Mandatory Convertible Preferred
Stock Conversion Rate Adjustments
Adjustments to Fixed Conversion Rates. |
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We will also pay converting holders an amount in cash equal to
(i) all accrued and unpaid dividends, whether or not
previously declared, on the converted shares of mandatory |
S-5
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convertible preferred stock to, but not including, the effective
date, and (ii) the present value, as of the effective date,
of all remaining dividend payments on the converted shares of
mandatory convertible preferred stock through, and including,
the mandatory conversion date (excluding accrued and unpaid
dividends to the effective date). If we fail to pay such cash
amount, the conversion rate applicable to such conversion will
be adjusted as described under Description of Mandatory
Convertible Preferred Stock Conversion Rate
Adjustments Adjustment to Conversion Rate Upon
Conversion and the converting holders right to
receive such amount shall be extinguished upon conversion. |
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Conversion at Our Option Upon Nonpayment of Dividends |
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If we at any time have not paid the equivalent of six full
quarterly dividends (whether or not consecutive and whether or
not earned or declared) on any series of preferred stock at the
time outstanding, including the mandatory convertible preferred
stock, we may, at our option, cause all, but not less than all,
outstanding shares of the mandatory convertible preferred stock
to be automatically converted into a number of shares of our
common stock based on the fundamental change conversion rate (as
described above). We will also pay converting holders the sum of
an amount in cash equal to (i) all accrued and unpaid
dividends, whether or not previously declared, on the converted
shares of mandatory convertible preferred stock to, but not
including, the dividend nonpayment conversion date, and
(ii) the present value, as of the dividend nonpayment
conversion date, of all remaining dividend payments on the
converted shares of mandatory convertible preferred stock
through, and including, the mandatory conversion date (excluding
accrued and unpaid dividends to the dividend nonpayment
conversion date). If we fail to pay such cash amount for any
reason, the conversion rate applicable to such conversion will
be adjusted as described under Description of Mandatory
Convertible Preferred Stock Conversion Rate
Adjustments Adjustment to Conversion Rate Upon
Conversion and the converting holders right to
receive such amount shall be extinguished upon conversion. |
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Liquidation Preference |
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$50.00 per share of mandatory convertible preferred stock, plus
an amount equal to the sum of all accrued and unpaid dividends. |
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Voting Rights |
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The holders of the mandatory convertible preferred stock are
generally not entitled to any voting rights except as required
by Ohio law or by our Amended Articles of Incorporation. |
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In the event that we have not paid the equivalent of six full
quarterly dividend payments (whether or not consecutive and
whether or not earned or declared) on any series of our
preferred stock, including the mandatory convertible preferred
stock, the holders of preferred stock of all series, voting
separately as a class without regard to series, shall be
entitled to elect two members to the board of directors;
provided, |
S-6
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however, that the holders of the preferred stock shall
not have or exercise such special class voting rights except at
meetings of such shareholders for the election of directors at
which the holders of not less than a majority of the outstanding
shares of preferred stock of all series are present in person or
by proxy; and provided, further, that such special class
voting rights, once vested shall remain so vested until all
accrued and unpaid dividends on the preferred stock of all
series then outstanding shall have been paid, whereupon the
holders of preferred stock shall be divested of such special
class voting rights in respect of subsequent elections of
directors, subject to the revesting of such special class voting
rights in the event of the reoccurrence of the nonpayment of
dividends described above. |
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In the event of a nonpayment of dividends, if we elect to cause
a conversion as described under Description of Mandatory
Convertible Preferred Stock Conversion at Our Option
Upon Nonpayment of Dividends, the rights of holders of the
mandatory convertible preferred stock to participate in the
election of two directors as set forth above effectively will be
eliminated. |
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The affirmative vote or consent of the holders of at least
two-thirds of the shares of our preferred stock (including the
mandatory convertible preferred stock), voting or consenting
separately as a class, shall be necessary to effect:
(i) certain amendments, alterations or repeals of the
provisions of our Amended Articles of Incorporation or of our
Code of Regulations; (ii) certain purchases or redemptions
of less than all of our preferred stock (including any of the
mandatory convertible preferred stock); or (iii) the
authorization, creation or the increase in the authorized amount
of any shares of any class or any security convertible into
shares of any class, in either case, ranking prior to our
preferred stock. |
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The affirmative vote or consent of the holders of at least a
majority of the shares of our preferred stock (including the
mandatory convertible preferred stock), voting or consenting
separately as a class, shall be necessary to effect any one or
more of: (i) the sale, lease or conveyance by us of all or
substantially all of our property or business; (ii) certain
consolidations or mergers involving us; or (iii) the
authorization of any shares ranking on a parity with our
preferred stock or an increase in the authorized number of
shares of our preferred stock. |
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Ranking |
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With respect to dividend or distribution rights, upon
liquidation, winding up or dissolution, our mandatory
convertible preferred stock will rank: |
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senior to our common stock, and to each other class
of capital stock established after the original issue date of
the mandatory convertible preferred stock, the terms of which
provide that such class of capital stock is junior and
subordinate to the mandatory convertible preferred stock;
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S-7
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equally with any class of capital stock established
after the preferred stock issue date, the terms of which
expressly provide that such class of capital stock is not given
preference over the mandatory convertible preferred stock; and
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junior to any class of capital stock established
after the issue date of the mandatory convertible preferred
stock, the terms of which expressly provide that such class of
capital stock is given preference over the mandatory convertible
preferred stock.
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Listing |
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Prior to this offering, there has been no public market for the
mandatory convertible preferred stock. We have applied to list
the mandatory convertible preferred stock on the New York Stock
Exchange under the symbol GTPrA. |
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Our common stock is listed on the New York Stock Exchange under
the symbol GT. |
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Use of Proceeds |
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We estimate that the net proceeds from this offering will be
approximately $421 million (approximately $484 million
if the underwriters exercise their option to purchase additional
shares in full), after deducting underwriting discounts and
estimated offering expenses. |
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We intend to use a portion of the net proceeds from this
offering to redeem $350 million in principal amount of our
outstanding 10.500% Senior Notes due May 15, 2016 at
the redemption price of 110.500% of the principal amount, plus
accrued and unpaid interest to the redemption date. We intend to
use the remaining net proceeds from this offering for general
corporate purposes. See Use of Proceeds. |
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Risk Factors |
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An investment in the mandatory convertible preferred stock
involves a significant degree of risk. We urge you to carefully
consider all of the information described in the section
entitled Risk Factors beginning on
page S-11
of this prospectus supplement. |
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Certain Material United States Federal Income Tax
Considerations |
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You should consult your tax advisor with respect to the U.S.
federal income tax consequences of owning the mandatory
convertible preferred stock in light of your particular
situation and with respect to any tax consequences arising under
the laws of any state, local, foreign or other taxing
jurisdiction. See Certain Material United States Federal
Income Tax Considerations. |
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Book-entry, Delivery and Form |
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The mandatory convertible preferred stock will be represented by
one or more permanent global certificates in definitive, fully
registered form deposited with a custodian for, and registered
in the name of a nominee of, The Depository Trust Company. |
S-8
Risk
Factors
You should carefully consider all information in this prospectus
supplement, the accompanying prospectus and the documents
incorporated by reference herein as set out in the section
entitled Incorporation of Certain Documents by
Reference on
page S-iii
of this prospectus supplement. In particular, you should
evaluate the specific risk factors set forth in the section
entitled Risk Factors in this prospectus supplement,
as well as in the documents incorporated by reference herein and
therein, for a discussion of risks relating to an investment in
our mandatory convertible preferred stock.
S-9
Summary
Consolidated Financial Data
The following table sets forth summary consolidated historical
financial data for Goodyear. The summary consolidated financial
data as of and for the years ended December 31, 2010, 2009
and 2008 (excluding the summary balance sheet data as of
December 31, 2008 and the ratio of earnings to combined
fixed charges and preferred dividends as of December 31,
2010, 2009 and 2008) have been derived from our audited
consolidated financial statements and related notes that appear
in our Annual Report on
Form 10-K
for the year ended December 31, 2010, which is incorporated
by reference herein and in the accompanying prospectus. The
summary balance sheet data as of December 31, 2008 is
audited and appears in our Annual Report on Form 10-K for
the year ended December 31, 2009. The ratio of earnings to
combined fixed charges and preferred dividends as of
December 31, 2010, 2009 and 2008 is unaudited. The
calculation of the ratio of earnings to combined fixed charges
and preferred dividends is filed as Exhibit 12.1 to the
registration statement of which this prospectus supplement forms
a part.
You should read this information in conjunction with
Managements Discussion and Analysis of Financial
Condition and Results of Operations and our financial
statements and related notes in our Annual Report on
Form 10-K
for the year ended December 31, 2010.
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Year Ended December 31,
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2010
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2009
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2008
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(Dollars in millions)
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Statements of operations data:
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Net sales
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$
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18,832
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$
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16,301
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$
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19,488
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Net loss
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(164
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)
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(364
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)
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(23
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Less: minority shareholders net income
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52
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11
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54
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Goodyear net loss
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$
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(216
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)
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$
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(375
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)
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$
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(77
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Balance sheet data:
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Cash and cash equivalents
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$
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2,005
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$
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1,922
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$
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1,894
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Total assets
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15,630
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14,410
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15,226
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Total long term debt and capital leases
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4,507
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4,296
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4,714
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Goodyear shareholders equity
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644
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735
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1,022
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Total shareholders equity
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921
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986
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1,253
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Other data:
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Capital expenditures
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$
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944
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$
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746
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$
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1,049
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Ratio of earnings to combined fixed charges and preferred
dividends
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*
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**
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1.33x
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* |
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Earnings for the year ended December 31, 2010 were
inadequate to cover fixed charges. The coverage deficiency was
$22 million. |
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** |
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Earnings for the year ended December 31, 2009 were
inadequate to cover fixed charges. The coverage deficiency was
$372 million. |
S-10
RISK
FACTORS
Any investment in our mandatory convertible preferred stock
involves a high degree of risk. You should carefully consider
the risks described below and all of the information contained
in and incorporated by reference into this prospectus supplement
and the accompanying prospectus before deciding whether to
purchase our common stock. In addition, you should carefully
consider, among other things, the matters discussed under
Risk Factors in our Annual Report on
Form 10-K
for the year ended December 31, 2010, which is incorporated
by reference into this prospectus supplement and the
accompanying prospectus. The risks and uncertainties described
below or incorporated by reference herein are not the only risks
and uncertainties we face. Additional risks and uncertainties
not presently known to us or that we currently deem immaterial
may also impair our business operations. If any of the risks
described below or incorporated by reference herein actually
occur, our business, financial condition and results of
operations could be materially adversely affected. In that
event, the trading price of our securities could decline, and
you may lose all or part of your investment. The risks described
below or incorporated by reference herein also include
forward-looking statements and our actual results may differ
substantially from those discussed in these forward-looking
statements. See Forward-Looking Information
Safe Harbor Statement.
Risks Related to
This Offering
Our board of
directors is not required to declare dividends on the mandatory
convertible preferred stock.
Holders of the shares of the mandatory convertible preferred
stock will be entitled to receive dividends when, as and if
declared by our board of directors. Our board of directors is
not required to declare dividends on our mandatory convertible
preferred stock and may elect not to do so. If our board of
directors does not declare dividends on the mandatory
convertible preferred stock, such dividends will accrue and
accumulate but will not bear interest.
We may not be
able to pay cash dividends on the mandatory convertible
preferred stock.
Our senior secured credit facilities and certain of our
indentures contain covenants that may restrict our ability to
pay cash dividends on our capital stock, including the mandatory
convertible preferred stock. Specifically, under most of our
existing financing agreements, we may pay cash dividends and
make other distributions on our capital stock, including the
mandatory convertible preferred stock, only if certain financial
tests are met or certain exceptions are available. Any credit
facilities, indentures or other financing agreements we enter
into in the future will likely contain similar restrictions. If
at any time our credit facilities, indentures or other financing
agreements prohibit the payment of cash dividends on the
mandatory convertible preferred stock, we will be unable to pay
such dividends unless we can refinance amounts outstanding under
those financing agreements or obtain an amendment or waiver of
the applicable restrictions. We are under no obligation to
attempt to refinance such amounts or seek such an amendment or
waiver nor can there be any assurance that we would be
successful in doing so. In such circumstance, we may instead
elect to defer the payment of dividends.
Under the Ohio General Corporation Law, any dividends we pay on
the mandatory convertible preferred stock may not exceed the
amount of our surplus, plus the difference between (i) the
reduction in surplus that resulted from the immediate
recognition of the transition obligation under
SFAS No. 106 and (ii) the aggregate amount of the
transition obligation that would have been recognized as of the
date of the declaration of the dividend payment if we had
elected to amortize recognition of the transition obligation
under SFAS No. 106. A surplus is defined
as the excess of our assets over our liabilities plus stated
capital, if any. Even if this condition is met, we may not have
sufficient cash on hand to pay such dividends.
S-11
If we are unable to pay dividends in cash, either because of
restrictions imposed by our financing agreements, under Ohio law
or for any other reason, such dividends will accrue and
accumulate but will not bear interest.
A holder of
the mandatory convertible preferred stock bears the risk of any
decline in the market value of our common stock.
The number of shares of our common stock that you will receive
for each share of mandatory convertible preferred stock upon
mandatory conversion is capped at the maximum conversion rate.
If the applicable per share market value of our common stock at
the time of such mandatory conversion is less than the price
corresponding to the maximum conversion rate, which we call the
initial price, then the market value of the common stock that
you receive upon mandatory conversion will be less than the
stated amount of $50.00 per share of mandatory convertible
preferred stock. In such case, the effective price per share
that you pay for the shares of common stock that you receive
upon mandatory conversion of the mandatory convertible preferred
stock will be higher than the market value of those shares. You
will have no right to receive additional shares of our common
stock or any payment or other compensation to offset any decline
in the market value of our common stock below the initial price.
Accordingly, a holder of the mandatory convertible preferred
stock assumes the entire risk that the market value of our
common stock may decline. Any decline in the market value of our
common stock and related decline in the value of the mandatory
convertible preferred stock may be substantial and, depending on
the extent of the decline, you could lose all or substantially
all your investment in the mandatory convertible preferred stock.
Purchasers of
the mandatory convertible preferred stock may not realize any or
all of the benefit of an increase in the market price of shares
of our common stock.
The market value of our common stock that you will receive upon
mandatory conversion of the mandatory convertible preferred
stock on the mandatory conversion date will exceed the stated
amount of $50.00 per share of the mandatory convertible
preferred stock only if the applicable per share market value of
our common stock as defined under Description of Mandatory
Convertible Preferred Stock Mandatory
Conversion equals or exceeds the threshold appreciation
price of $ . The threshold
appreciation price represents an appreciation of
approximately % over the initial
price.
If the applicable per share market value of our common stock
exceeds the initial price but is less than the threshold
appreciation price, a holder of the mandatory convertible
preferred stock will realize no equity appreciation on our
common stock. Even if the applicable market value of our common
stock exceeds the threshold appreciation price, the value of the
common stock received upon conversion will be
approximately % of the value of the
common stock that could be purchased with $50.00 at the time of
this offering. As a result, the opportunity for equity
appreciation provided by an investment in the mandatory
convertible preferred stock is less than that provided by a
direct investment in shares of our common stock.
The trading
price of our common stock will directly affect the trading price
of the mandatory convertible preferred stock and may fluctuate
significantly, which could negatively affect the holders of the
mandatory convertible preferred stock.
We believe that the trading price of our common stock will
directly affect the trading price of the mandatory convertible
preferred stock. The trading price of our common stock, in turn,
may fluctuate significantly in response to a number of factors,
many of which are beyond our control. For instance, if our
financial results are below the expectation of securities
analysts and investors, the market price of our common stock
could decrease, perhaps significantly. Other factors that may
affect the market price of our common stock include:
announcements relating to significant corporate
transactions;
S-12
fluctuations in our quarterly financial results;
changes in financial estimates and recommendations
by financial analysts;
changes in ratings of our other securities;
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operating and stock price performance of companies that
investors deem comparable to us; and
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changes in government regulation or proposals
relating to us.
In addition, the U.S. securities markets have experienced
significant price and volume fluctuations. These fluctuations
often have been unrelated to the operating performance of
companies in these markets. Market fluctuations and broad
market, economic and industry factors may negatively affect the
price of our common stock, regardless of our operating
performance. As a result of fluctuations in the price of our
common stock, you may not be able to sell your shares of the
mandatory convertible preferred stock at or above the initial
offering price, or at all.
The conversion
rates applicable to the mandatory convertible preferred stock
will not be adjusted for all events that may be
dilutive.
The number of shares of our common stock issuable upon
conversion of the mandatory convertible preferred stock is
subject to adjustment only for share splits and combinations,
share dividends and specified other transactions. The number of
shares of our common stock issuable upon conversion is not
subject to adjustment for other events, such as employee stock
option grants, offerings of our common stock for cash or in
connection with acquisitions or other transactions that may
increase the number of outstanding shares of common stock and
dilute the ownership of existing common stock holders. The terms
of the mandatory convertible preferred stock do not restrict our
ability to offer common stock in the future or to engage in
other transactions that could dilute our common stock. We have
no obligation to consider the interests of the holders of the
mandatory convertible preferred stock in engaging in any such
offering or transaction.
Holders of the
mandatory convertible preferred stock will have no rights as
holders of common stock until they acquire our common
stock.
Until you acquire shares of our common stock upon conversion of
the mandatory convertible preferred stock, you will have no
rights with respect to our common stock, including voting rights
(except as required by the Ohio General Corporation Law or our
Amended Articles of Incorporation, as described in
Description of Mandatory Convertible Preferred
Stock Voting Rights), rights to respond to
tender offers or rights to receive any dividends or other
distributions on our common stock. Upon conversion, you will be
entitled to exercise the rights of a holder of our common stock
only as to matters for which the record date occurs after the
date on which your shares of the mandatory convertible preferred
stock were converted to shares of our common stock. For example,
in the event that an amendment is proposed to our Code of
Regulations or Amended Articles of Incorporation requiring
stockholder approval and the record date for determining the
stockholders of record entitled to vote on the amendment occurs
prior to your conversion of the mandatory convertible preferred
stock, you will not be entitled to vote on the amendment,
although you will nevertheless be subject to any resulting
changes in the powers, preference or special rights of our
common stock.
Holders of the
mandatory convertible preferred stock will not have any voting
rights, except under limited circumstances.
Holders of the mandatory convertible preferred stock will not
have voting rights, except as required by the Ohio General
Corporation Law and our Amended Articles of Incorporation.
Holders of the mandatory convertible preferred stock will have
no right to vote for any members of our board of directors
except in the case of certain dividend arrearages. Specifically,
if at any time we have not paid the equivalent of six full
quarterly dividends (whether or not consecutive) on any series
of our
S-13
preferred stock at the time outstanding (including the mandatory
convertible preferred stock), the holders of preferred stock of
all series, voting separately as a class without regard to
series, will be entitled to elect two members of our board. In
such circumstance, we may, at our option, cause all shares of
the mandatory convertible preferred stock to automatically
convert to shares of our common stock. If we took such action,
the rights of holders of the mandatory convertible preferred
stock to elect two directors would effectively be eliminated.
See Description of Mandatory Convertible Preferred
Stock Voting Rights and Description of
Mandatory Convertible Preferred Stock Conversion at
Our Option Upon Nonpayment of Dividends.
The mandatory
convertible preferred stock will rank junior to all of our and
our subsidiaries liabilities in the event of our
bankruptcy or the liquidation or winding up of our
assets.
In the event of our bankruptcy, liquidation or winding up, our
assets will be available to pay the liquidation preference on
the mandatory convertible preferred stock only after all of our
liabilities have been paid. In addition, the mandatory
convertible preferred stock will effectively rank junior to all
existing and future liabilities of our subsidiaries and any
capital stock of our subsidiaries held by third parties. The
rights of holders of the mandatory convertible preferred stock
to participate in the assets of our subsidiaries upon any
liquidation or reorganization of any subsidiary will rank junior
to the prior claims of that subsidiarys creditors and
minority equity holders, if any. In the event of our bankruptcy,
liquidation or winding up, there may not be sufficient assets
remaining, after paying our and our subsidiaries
liabilities, to pay amounts due on any or all of the mandatory
convertible preferred stock then outstanding.
Holders of the
mandatory convertible preferred stock may have to pay U.S.
federal income tax if we adjust, or fail to adjust, the
conversion of the mandatory convertible preferred stock in
certain circumstances, even if such holders do not receive a
corresponding distribution of cash.
The conversion rate of the mandatory convertible preferred stock
will be adjusted in certain circumstances. See Description
of Mandatory Convertible Preferred Stock Adjustments
to the Conversion Rate. For U.S. federal income tax
purposes, adjustments to a fixed conversion rate, or failures to
make certain adjustments, that have the effect of increasing
your proportionate interest in our assets or earnings and
profits may result in a deemed distribution to you. Such deemed
distribution may be taxable to you as a dividend, even though
you do not actually receive a distribution. If you are a
non-U.S. holder
(as defined in Certain Material United States Federal
Income Tax Considerations), such deemed distribution may
be subject to U.S. federal withholding tax at a 30% or
reduced treaty rate. We will withhold the U.S. federal tax
on such dividend from any cash, shares of common stock, or sales
proceeds otherwise payable to you. See Certain Material
United States Federal Income Tax Considerations.
Shares
eligible for public sale after this offering could adversely
affect our stock price and in turn the market price of the
mandatory convertible preferred stock.
Under our Amended Articles of Incorporation, we have the
authority to issue 450,000,000 shares of our common stock.
As of March 24, 2011, approximately 244.1 million shares of
our common stock were outstanding. The future sale of a
substantial number of our shares of common stock in the public
market, or the perception that such sales could occur, could
significantly reduce our common stock price which, in turn,
could adversely affect the market price of the mandatory
convertible preferred stock. It could also make it more
difficult for us to raise funds through equity offerings in the
future.
S-14
We may issue
additional series of preferred stock that rank on a parity with
the mandatory convertible preferred stock as to dividend
payments and liquidation preference and that vote with the
mandatory convertible preferred stock on most issues on which
the preferred stock is permitted to vote, which may negatively
affect your investment.
Without giving effect to the shares of mandatory convertible
preferred stock that we are offering hereby, we have the
authority under our Amended Articles of Incorporation to issue
50,000,000 shares of preferred stock. Our Amended Articles
of Incorporation do not prohibit us from issuing additional
series of preferred stock that would rank on a parity with the
mandatory convertible preferred stock. The issuance of any such
series of preferred stock could have the effect of reducing the
amounts available to the holders of the mandatory convertible
preferred stock in the event of our liquidation. If we do not
have sufficient funds to pay dividends on the outstanding
mandatory convertible preferred stock and such other series of
preferred stock, it would also reduce amounts available to the
holders of the mandatory convertible preferred stock for the
payment of dividends. Except with respect to changes to our
Amended Articles of Incorporation or our Code of Regulations
that adversely affect only one series of our preferred stock,
the holders of the mandatory convertible preferred stock and any
other series of preferred stock that we issue vote together, as
a class, on the issues on which our preferred stock has the
right to vote, including our consolidation or merger with
another corporation. The interests of the holders of any other
series of preferred stock that we issue may be different from
the interests of the holders of the mandatory convertible
preferred stock.
The
fundamental change conversion rate may not adequately compensate
you upon the occurrence of a fundamental change or conversion at
our option upon nonpayment of dividends.
If a fundamental change occurs, you will have the right to
convert your shares of the mandatory convertible preferred stock
prior to the mandatory conversion date, and we will deliver
shares of our common stock calculated at the fundamental change
conversion rate. In addition, if we at any time have not paid
the equivalent of six full quarterly dividends (whether or not
consecutive) on any series of our preferred stock at the time
outstanding (including the mandatory convertible preferred
stock), we will have the right to cause all of the shares of the
mandatory convertible preferred stock to convert into shares of
our common stock based upon the fundamental change conversion
rate. A description of how the fundamental change conversion
rate will be determined in connection with a fundamental change
and the form in which it will be paid is set forth under
Description of Mandatory Convertible Preferred
Stock Conversion Upon Fundamental Change and
how the fundamental change conversion rate will be determined in
connection with a conversion upon nonpayment of dividends is set
forth under Description of Mandatory Convertible Preferred
Stock Conversion at Our Option Upon Nonpayment of
Dividends. The fundamental change conversion rate is
intended to compensate you for the lost option value associated
with the mandatory convertible preferred stock. However, it is
only an approximation of these values and may not adequately
compensate you. Furthermore, only certain transactions and
events are considered fundamental changes. If we
engage in other transactions, you may not receive an adjustment
to the applicable conversion rate even though the value of your
shares of the mandatory convertible preferred stock may be
affected.
Provisions of
Ohio law and provisions in our Amended Articles of Incorporation
and Code of Regulations could delay or prevent a change in
control of us, even if that change would be beneficial to our
stockholders.
We are incorporated under the laws of the State of Ohio. Ohio
law imposes some restrictions on mergers and other business
combinations between us and holders of 10% or more of our
outstanding common stock. In addition, provisions of our Amended
Articles of Incorporation and Code of Regulations may have the
effect, either alone or in combination with each other, of
making more difficult or discouraging a business combination or
an attempt to gain control of us that is not approved by our
board of directors, even if such combination would be beneficial
to our stockholders. Because
S-15
the mandatory convertible preferred stock is convertible into
our common stock, these restrictions could adversely affect the
value of the mandatory convertible preferred stock.
A holder of
shares of the mandatory convertible preferred stock may not
receive upon conversion all of the accrued and unpaid dividends
on the mandatory convertible preferred stock as a result of the
share cap.
Upon any conversion, holders will be entitled to receive an
amount in cash equal to accrued and unpaid dividends (through a
date determined by the applicable conversion provision), and in
connection with a conversion upon a fundamental change or a
conversion following nonpayment of dividends only, the present
value of all remaining dividend payments on the converted shares
of mandatory convertible preferred stock. If we do not pay this
amount in cash, the conversion rate will be adjusted in respect
of the unpaid amount; however, any such adjustment will be
subject to the share cap described under Description of
Mandatory Convertible Preferred Stock
Conversion. As a result of the limitation imposed by the
share cap, we may be unable to issue a sufficient number of
shares that would have a value equal to the amount payable in
respect of accrued and unpaid dividends or, if applicable,
remaining dividends. In such event, the share cap would reduce
the return that holders may achieve with respect to their
investment in the mandatory convertible preferred stock.
The secondary
market for the mandatory convertible preferred stock may be
illiquid.
We have applied to list the mandatory convertible preferred
stock on the New York Stock Exchange. However, there can be no
assurance that our mandatory convertible preferred stock will be
listed and, if listed, that it will continue to be listed. In
addition, listing the mandatory convertible preferred stock on
the New York Stock Exchange does not guarantee that a trading
market will develop or, if a trading market does develop, the
depth or liquidity of that market or the ability of holders to
sell their shares of the mandatory convertible preferred stock
easily.
In addition, the liquidity of the trading market in the
mandatory convertible preferred stock, and the market price
quoted therefor, may be adversely affected by changes in the
overall market for this type of security and by changes in our
financial performance or prospects or in the prospects for
companies in our industry generally. As a result, we cannot
assure you that an active trading market will develop for the
mandatory convertible preferred stock. If an active trading
market does not develop or is not maintained, the market price
and liquidity of the mandatory convertible preferred stock may
be adversely affected. In that case, you may not be able to sell
the mandatory convertible preferred stock that you hold at a
particular time or at a favorable price. In addition, as shares
of the mandatory convertible preferred stock are converted, the
liquidity of the mandatory convertible preferred stock that
remains outstanding may decrease.
Recent
developments in the equity-linked markets may adversely affect
the market value of shares of the mandatory convertible
preferred stock.
We expect that many investors in, and potential purchasers of,
the mandatory convertible preferred stock will employ, or seek
to employ, a convertible arbitrage strategy with respect to the
mandatory convertible preferred stock. Investors that employ a
convertible arbitrage strategy with respect to convertible
equity instruments typically implement that strategy by selling
short the common stock underlying the mandatory convertible
preferred stock or by entering into cash-settled
over-the-counter
derivative transactions with respect to the underlying common
stock that have the same economic effect as a short sale of the
underlying common stock. As a result, any specific rules
regulating short selling of securities or other governmental
action that interferes with the ability of market participants
to effect short sales in our common stock could adversely affect
the ability of investors in, or potential purchasers of, the
mandatory convertible preferred stock to conduct the convertible
arbitrage strategy that we believe they will employ, or seek to
employ, with respect to the mandatory convertible preferred
stock. This could, in turn, adversely affect the trading price
and liquidity of the mandatory convertible preferred stock.
S-16
On May 10, 2010, amendments to Rule 201 of
Regulation SHO to implement a new short sale price test
became effective. The Rule 201 amendments restrict the
short selling of any covered security that triggers
a circuit breaker by falling at least 10% in one day, at which
point short sale orders can be displayed or executed only if the
order price is above the current national best bid, subject to
certain limited exceptions. Compliance with the amendments to
Rule 201 was required by February 28, 2011. Because
our common stock is a covered security, the new
restrictions may interfere with the ability of investors in, and
potential purchasers of, the mandatory convertible preferred
stock, to effect short sales in our common stock and to conduct
the convertible arbitrage strategy that we believe they will
employ, or seek to employ, with respect to the mandatory
convertible preferred stock.
In addition, on May 18, 2010, the New York Stock Exchange
and other national securities exchanges filed proposed rule
changes with the SEC under which they would be permitted to halt
trading in certain individual stocks if the price moves at least
10% in a five-minute period. Similarly, on May 18, 2010,
the Financial Industry Regulatory Authority, Inc., or FINRA,
proposed an amendment to FINRA Rule 6121 (Trading Halts Due
to Extraordinary Market Volatility) to allow FINRA to halt all
trading by FINRA members otherwise than on an exchange following
the initiation by a primary securities exchange of a trading
halt under the rules of that exchange. As approved by the SEC on
June 10, 2010, these proposed rule changes were to be
implemented during a pilot period that was to end on
December 10, 2010 and was to include only stocks in the
S&P 500 Index. However, on September 10, 2010, the SEC
adopted requests by FINRA and the various exchanges to expand
the pilot to also cover securities included in the Russell 1000
Index as well as certain specified exchange traded products. The
end of the pilot period has since been extended until
April 11, 2011. Our common stock is included in the
S&P 500 Index as of the date of this prospectus supplement.
FINRA and the exchanges are expected to file additional proposed
rule changes, some of which may extend the pilot period, make
the rule changes permanent or expand the list of securities
covered by such rules.
On September 10, 2010, the SEC also approved amendments to
FINRA Rule 11892 (Clearly Erroneous Transactions in
Exchange-Listed Securities) and corresponding exchange rules
that are intended to clarify the process for reviewing
potentially erroneous trades in exchange-listed securities.
These amendments, which are effective on a pilot basis until
April 11, 2011, were intended to provide for uniform
treatment of clearly erroneous transaction reviews of
(a) multi-stock events involving 20 or more securities,
(b) transactions that trigger an individual stock trading
pause by a primary listing market and subsequent transactions
that occur before the trading halt is in effect for
over-the-counter
trading and (c) other circumstances as necessary for the
maintenance of a fair and orderly market and the protection of
investors and the public interest. Moreover, in a speech given
on September 22, 2010 before the Security Traders
Association, Mary Schapiro, Chairman of the SEC, stated that the
SEC will likely go further than these recently enacted circuit
breaker regulations and that one possible alternative currently
under discussion is a
limit-up/limit-down
system under which trading parameters would be established and
trades would have to be executed within a range tied to the
national best bid and offer. Both the rule changes already
approved by the SEC and any future proposed rule changes, to the
extent such rule changes apply to our common stock, may
decrease, or prevent an increase in, the market price or
liquidity of our common stock or interfere with the ability of
investors in, and potential purchasers of, the mandatory
convertible preferred stock, to effect hedging transactions in
or relating to our common stock and to conduct the convertible
arbitrage strategy that we believe they will employ, or will
seek to employ, with respect to the mandatory convertible
preferred stock.
On July 21, 2010, the Dodd-Frank Wall Street Reform and
Consumer Protection Act was enacted. This new legislation may
require many
over-the-counter
swaps to be centrally cleared through regulated clearinghouses
and traded on exchanges or comparable trading facilities. In
addition, swap dealers and major market participants may be
required to comply with margin and capital requirements as well
as public reporting requirements to provide transaction and
pricing data
S-17
on both cleared and uncleared swaps. These requirements could
adversely affect the ability of investors in, or potential
purchasers of, the mandatory convertible preferred stock to
implement a convertible arbitrage strategy with respect to the
mandatory convertible preferred stock (including increasing the
costs incurred by such investors in implementing such strategy).
This could, in turn, adversely affect the trading price and
liquidity of the mandatory convertible preferred stock. The
legislation will become effective on the later of 360 days
following the enactment of the legislation or 60 days after
the publication of the final rule; however, it is unclear
whether the margin requirements will apply retroactively to
existing swap transactions. In addition, on December 15,
2010, the SEC released proposed rules relating to the mandatory
clearing of security-based swaps and the end-user exception to
mandatory clearing of security-based swaps (pursuant to which
certain non-financial end-users will be exempt from the central
execution and clearing requirements). We cannot predict how this
legislation will be implemented by the SEC or the magnitude of
the effect that this legislation will have on the trading price
or liquidity of the mandatory convertible preferred stock.
Although the direction and magnitude of the effect that the
amendments to Regulation SHO, FINRA and national securities
exchange rule changes, or implementation of the Dodd-Frank Wall
Street Reform and Consumer Protection Act may have on the
trading price and the liquidity of the mandatory convertible
preferred stock will depend on a variety of factors, many of
which cannot be determined at this time, past regulatory actions
have had a significant impact on the trading prices and
liquidity of convertible equity instruments. For example, in
September 2008, the SEC issued emergency orders generally
prohibiting short sales in the common stock of a variety of
financial services companies while Congress worked to provide a
comprehensive legislative plan to stabilize the credit and
capital markets. The orders made the convertible arbitrage
strategy that many convertible equity investors employ difficult
to execute and adversely affected both the liquidity and trading
price of mandatory convertible preferred stock issued by many of
the financial services companies subject to the prohibition. Any
governmental action that similarly restricts the ability of
investors in, or potential purchasers of, the mandatory
convertible preferred stock to effect short sales in our common
stock, including the recently adopted amendments to
Regulation SHO, FINRA and exchange rule changes and the
implementation of the Dodd-Frank Wall Street Reform and Consumer
Protection Act, could similarly adversely affect the trading
price and the liquidity of the mandatory convertible preferred
stock.
S-18
USE OF
PROCEEDS
We estimate that the net proceeds from this offering, after
deducting underwriting discounts and commissions and estimated
offering expenses payable by us, will be approximately
$421 million (approximately $484 million if the
underwriters exercise their option to purchase additional shares
in full).
We intend to use a portion of the net proceeds from this
offering to redeem $350 million in principal amount of our
outstanding 10.500% Senior Notes due May 15, 2016 (the
2016 Notes) at the redemption price of 110.500% of
the principal amount, plus accrued and unpaid interest to the
redemption date. The redemption of the 2016 Notes will be made
under an equity clawback provision that permits a
redemption of up to 35% of the aggregate principal amount of the
notes with the proceeds of a public equity offering. We intend
to use the remaining net proceeds from this offering for general
corporate purposes, which may include the repayment of other
outstanding indebtedness.
S-19
PRICE RANGE OF
COMMON STOCK
Our common stock is quoted on the New York Stock Exchange under
the symbol GT. On March 25, 2011, the last
reported sale price of our common stock on the New York Stock
Exchange was $15.45 per share. To our knowledge,
244,137,897 shares of our common stock were held by
approximately 20,221 registered holders as of March 24,
2011. The following table sets forth, for the periods indicated,
the high and low price of our common stock as reported on the
New York Stock Exchange consolidated transaction reporting
system.
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Year
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High
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Low
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2009:
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|
|
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First Quarter
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$
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8.09
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$
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3.17
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Second Quarter
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14.26
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|
|
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6.00
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Third Quarter
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|
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18.84
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|
|
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9.98
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Fourth Quarter
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|
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18.23
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|
|
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11.87
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2010:
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|
|
|
|
|
|
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First Quarter
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$
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16.39
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$
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12.06
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Second Quarter
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|
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15.27
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|
|
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9.89
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Third Quarter
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|
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12.66
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|
|
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9.10
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Fourth Quarter
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|
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12.18
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|
|
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9.51
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2011:
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|
|
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First Quarter (through March 25, 2011)
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$
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15.71
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$
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11.42
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S-20
DIVIDEND HISTORY
OF COMMON STOCK
We have not paid a dividend on our common stock since the fourth
quarter of 2002. We do not currently intend to pay any dividends
on our common stock, but rather intend to retain earnings, if
any, for future operations, expansion of our business and debt
repayment. The declaration and payment of future dividends to
holders of our common stock will be at the discretion of our
board of directors and will depend upon many factors, including
our financial condition, earnings, compliance with debt
instruments, legal requirements and other factors as our board
of directors deems relevant. Our primary credit facilities and
certain of our debt securities may restrict our ability to pay
cash dividends on our capital stock, including our common stock
and the mandatory convertible preferred stock, under certain
circumstances.
S-21
CAPITALIZATION
The following table shows our cash and cash equivalents and our
consolidated historical capitalization as of December 31,
2010:
on an actual cash basis; and
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on an as-adjusted basis to give effect to:
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the sale of the mandatory convertible preferred stock offered
hereby, assuming no exercise of the underwriters option to
purchase additional shares, and
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the use of the estimated $421 million in net proceeds
therefrom, after deducting underwriting discounts and
commissions and estimated offering expenses payable by us, to
redeem $350 million in principal amount of our 2016 Notes
at the redemption price of 110.500% of the principal amount,
with the remaining net proceeds held in cash, a portion of which
will be used to pay accrued and unpaid interest on the
redemption of the 2016 Notes.
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As described under the caption Use of Proceeds, we
intend to use the remaining net proceeds from this offering for
general corporate purposes, which may include the repayment of
other indebtedness. For more information on the use of proceeds
from this offering, see Use of Proceeds.
No adjustments have been made to reflect normal course
operations by us, or other developments with our business, after
December 31, 2010, and thus the as-adjusted information
provided below is not indicative of our actual cash position or
capitalization at any date. This table should be read in
conjunction with the consolidated financial statements of the
Company, which are incorporated by reference into this
prospectus supplement and the accompanying prospectus.
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As of December 31, 2010
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Actual
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|
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As Adjusted
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(Unaudited)
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(Dollars in millions)
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Cash and cash equivalents(1)
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$
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2,005
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$
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2,039
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Total debt:
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Senior Secured European and German Revolving Credit Facilities(2)
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$
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$
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U.S. First Lien Revolving Credit Facility(3)
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U.S. Second Lien Term Loan Facility
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1,200
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1,200
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Pan-European Accounts Receivable Securitization Facility
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319
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|
|
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319
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10.500% Senior Notes due 2016(4)
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966
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|
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628
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8.75% Notes due 2020
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|
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263
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|
|
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263
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8.250% Senior Notes due 2020
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|
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993
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|
|
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993
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7% Notes due 2028
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149
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|
|
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149
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Chinese Credit Facilities
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|
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153
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153
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Other U.S. and international debt
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446
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446
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Notes payable and overdrafts
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|
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238
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|
|
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238
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Capital leases
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|
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18
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|
|
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18
|
|
|
|
|
|
|
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Total debt
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$
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4,745
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$
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4,407
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|
|
|
|
|
|
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Minority shareholders equity
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|
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584
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|
|
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584
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Goodyear shareholders equity(5)
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|
|
644
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|
|
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1,010
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Minority shareholders equity nonredeemable
|
|
|
277
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|
|
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277
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|
|
|
|
|
|
|
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Total capitalization
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$
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6,250
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|
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$
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6,278
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(1) |
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Reflects net proceeds remaining after the redemption of
$350 million in principal amount of our 2016 Notes at the
redemption price of 110.500% of the principal amount, a portion
of which will be used to pay accrued and unpaid interest on the
redemption of the 2016 Notes. |
S-22
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(2) |
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Excludes $12 million in outstanding letters of credit as of
December 31, 2010. As of March 23, 2011, there were
$360 million in borrowings outstanding and $7 million
in letters of credit outstanding under these facilities. The
remaining availability as of March 23, 2011 was
$404 million. |
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(3) |
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Excludes $474 million in outstanding letters of credit as
of December 31, 2010. As of March 23, 2011, there were
no borrowings outstanding and $452 million in letters of
credit outstanding under this facility. The remaining
availability as of March 23, 2011 was $1,048 million. |
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(4) |
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Actual column represents principal amount of $1,000 million
less unamortized discount. As adjusted column represents
principal amount of $650 million less unamortized discount. |
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(5) |
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Goodyear shareholders equity includes (i) common
stock, without par value, 450,000,000 shares authorized,
242,938,949 shares outstanding at December 31, 2010,
actual and as adjusted, and (ii) preferred stock, without
par value, 50,000,000 shares authorized, no shares
outstanding at December 31, 2010, actual, and
8,700,000 shares outstanding, as adjusted. |
S-23
RATIO OF EARNINGS
TO COMBINED FIXED CHARGES AND PREFERRED DIVIDENDS
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Year Ended December 31,
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2010
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2009
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2008
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2007
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2006
|
|
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Ratio of earnings to combined fixed charges and preferred
dividends(1)(2)
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*
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**
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1.33x
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|
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1.70x
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***
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* |
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Earnings for the year ended December 31, 2010 were
inadequate to cover fixed charges. The coverage deficiency was
$22 million. |
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** |
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Earnings for the year ended December 31, 2009 were
inadequate to cover fixed charges. The coverage deficiency was
$372 million. |
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*** |
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Earnings for the year ended December 31, 2006 were
inadequate to cover fixed charges. The coverage deficiency was
$228 million. |
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(1) |
For purposes of calculating our ratio of earnings to combined
fixed charges and preferred dividends:
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Earnings consist of pre-tax income (loss) from continuing
operations before adjustment for minority interests in
consolidated subsidiaries or income or loss from equity
investees plus (i) amortization of previously capitalized
interest and (ii) distributed income of equity investees
less (i) capitalized interest and (ii) minority
interest in pre-tax income of consolidated subsidiaries with no
fixed charges.
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Combined fixed charges and preferred dividends consist of:
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fixed charges, which consist of (i) interest expense,
(ii) capitalized interest, (iii) amortization of debt
discount, premium or expense, (iv) the interest portion of
rental expense (estimated to equal 1/3 of such expense, which is
considered a reasonable approximation of the interest factor)
and (v) proportionate share of fixed charges of investees
accounted for by the equity method; and
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preferred dividends, which consist of the amount of pre-tax
earnings that is required to pay the dividends on outstanding
preferred shares.
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The consolidated ratio of earnings to combined fixed charges and
preferred dividends is determined by adding back fixed charges,
as defined above, to earnings, as defined above, which is then
divided by combined fixed charges and preferred dividends, as
defined above.
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(2) |
We had no preferred shares outstanding during the periods
reflected in the table and thus paid no preferred dividends.
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S-24
DESCRIPTION OF
MANDATORY CONVERTIBLE PREFERRED STOCK
The following is a summary of some of the terms of the
mandatory convertible preferred stock. This summary contains a
description of the material terms of the mandatory convertible
preferred stock but is not necessarily complete. The following
summary of the terms and provisions of the mandatory convertible
preferred stock is qualified in its entirety by reference to the
pertinent sections of our articles of incorporation, as amended
(Amended Articles of Incorporation), including by
the certificate of amendment creating the mandatory convertible
preferred stock. We refer you to the documents referred to in
the following description, copies of which are available upon
request as described under Where You Can Find More
Information in this prospectus supplement. This summary
should also be read in conjunction with the Description of
Capital Stock section of this prospectus supplement, which
contains important information relevant to all holders of our
capital stock.
As used in this section, the terms the Company,
we, us, and our refer to The
Goodyear Tire & Rubber Company and not to any of its
subsidiaries.
General
Under our Amended Articles of Incorporation, our board of
directors is authorized, without further shareholder action, to
fix by an amendment to our Amended Articles of Incorporation the
terms and the powers, preferences and rights, and the
qualifications, limitations and restrictions thereof, of up to
50,000,000 shares of preferred stock (preferred
stock), without par value, in one or more series. Our
Amended Articles of Incorporation provide that all series of
such preferred stock that we may issue rank on parity with one
another and therefore we consider all such series to constitute
a single class of capital stock. We do not currently have any
preferred stock outstanding. At the consummation of this
offering, we will issue 8,700,000 shares of mandatory
convertible preferred stock. In addition, we have granted the
underwriters an option to purchase up to 1,300,000 additional
shares of mandatory convertible preferred stock in accordance
with the procedures set forth in Underwriting in
this prospectus supplement.
When issued, the mandatory convertible preferred stock, and our
common stock issuable upon the conversion of the mandatory
convertible preferred stock, will be fully paid and
nonassessable. The holders of the mandatory convertible
preferred stock will have no preemptive or preferential right to
purchase or subscribe to stock, obligations, warrants or other
of our securities of any class, other than the right to convert
into shares of our common stock as described herein. The
transfer agent, registrar, conversion and dividend disbursing
agent for the mandatory convertible preferred stock and the
transfer agent and registrar for our common stock is
Computershare Investor Services.
Ranking
The mandatory convertible preferred stock, with respect to
dividend rights or distribution rights upon our liquidation,
winding-up
or dissolution, ranks:
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senior to our common stock, and to each other class of capital
stock established after the original issue date of the mandatory
convertible preferred stock (which we will refer to as the
issue date), the terms of which expressly provide
that the rights of the holders thereof both as to the payment of
dividends and as to distributions in the event of our voluntary
or involuntary liquidation, dissolution or winding up are junior
and subordinate to the rights of the holders of the mandatory
convertible preferred stock (which we will refer to collectively
as junior stock or shares ranking junior to
the mandatory convertible preferred stock);
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equally with any class of capital stock established after the
issue date, the terms of which expressly provide that the right
of the holders thereof (i) are not given preference over
the rights of the holders of the mandatory convertible preferred
stock either as to the payment of dividends or as to
distributions in the event of our voluntary or involuntary
liquidation,
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S-25
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dissolution or winding up and (ii) either as to the payment
of dividends or as to distributions in the event of our
voluntary or involuntary liquidation, dissolution or winding up,
or as to both, rank on an equality (except as to the amounts
fixed therefor) with the rights of the holders of the mandatory
convertible preferred stock (which we will refer to collectively
as parity stock or shares ranking on a parity
with the mandatory convertible preferred stock); and
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junior to each class of capital stock established after the
issue date, the terms of which expressly provide that the rights
of the holders thereof either as to the payment of dividends or
as to distributions in the event of our voluntary or involuntary
liquidation, dissolution or winding up are given preference over
the right of the holders of the mandatory convertible preferred
stock (which we will refer to collectively as senior
stock or shares ranking prior to the mandatory
convertible preferred stock).
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Our Amended Articles of Incorporation provide that all series of
preferred stock that we issue will rank on a parity with one
another and therefore we consider all such series to constitute
a single class of capital stock. The approval of the holders of
shares of our outstanding preferred stock (including the
mandatory convertible preferred stock) voting as a single class
is required to amend our Amended Articles of Incorporation to
authorize or create a class of capital stock that ranks senior
or on a parity with our preferred stock or to increase the
authorized number of shares of our preferred stock. However, the
approval of the holders of shares of our outstanding preferred
stock (including the mandatory convertible preferred stock) is
not required for the authorization or creation of any future
series of preferred stock constituting a portion of the class of
50,000,000 shares of preferred stock currently authorized
for issuance. Any such future series would rank on a parity with
any other series of our preferred stock, including the mandatory
convertible preferred stock. See Voting
Rights.
Dividends
General
Holders of shares of the mandatory convertible preferred stock
will be entitled to receive, when, as and if declared by our
board of directors out of funds lawfully available for payment,
cumulative dividends at the rate per annum
of % per share on the initial
liquidation preference of $50.00 per share of the mandatory
convertible preferred stock (equivalent to
$ per annum per share), payable in
cash, as described under Method of Payment of
Dividends below. Dividends on the mandatory convertible
preferred stock will be payable quarterly on January 1,
April 1, July 1 and October 1 of each year,
commencing on July 1, 2011 and ending on April 1, 2014
(each, a dividend payment date), at such annual
rate, and shall accumulate from the most recent date as to which
dividends shall have been paid or, if no dividends have been
paid, from the issue date of the mandatory convertible preferred
stock, whether or not in any dividend period or periods there
have been funds lawfully available for the payment of such
dividends. If any dividend payment date is not a business day,
the dividend payable on such date shall be paid on the next
business day without any adjustment, interest or other penalty
in respect of such delay. For purposes hereof, a dividend
period shall refer to a period commencing on, and
including, a dividend payment date (or if no dividend payment
date has occurred, commencing on, and including, the issue
date), and ending on, and including, the day immediately
preceding the next succeeding dividend payment date. Dividends
will be payable to holders of record as they appear on our stock
register on the fifteenth calendar day of the month preceding
the month in which such dividend payment date falls or such
other record date fixed by our board of directors or any duly
authorized committee thereof that is not more than 60 nor less
than 10 days prior to such dividend payment date but only
to the extent a dividend has been declared to be payable on such
dividend payment date (each, a regular record date),
except that dividends payable on the mandatory conversion date,
as defined below, will be payable to the holders presenting the
mandatory convertible preferred stock for conversion. Dividends
payable on the mandatory convertible preferred stock for any
period other than a full dividend period (based upon the number
of days elapsed during the period) will be computed on the basis
of a 360-day
year consisting of twelve
30-day
months. The initial dividend on the mandatory convertible
preferred stock for the first
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dividend period, assuming the issue date is March 31, 2011,
is expected to be $ per share
(based on the annual dividend rate
of % and an initial liquidation
preference of $50.00 per share) and will be payable, if
declared, on July 1, 2011. Each subsequent quarterly
dividend on the mandatory convertible preferred stock, when and
if declared, will be $ per share
(based on the annual dividend rate
of % and the initial liquidation
preference of $50.00 per share).
No dividend will be paid unless and until our board of
directors, or any authorized committee of our board of
directors, declares a dividend payable with respect to the
mandatory convertible preferred stock. The terms of our senior
secured credit facilities and certain of our outstanding debt
securities may restrict our ability to declare or pay dividends
or distributions on our capital stock, including the mandatory
convertible preferred stock and our common stock. Specifically,
under most of our existing financing agreements, we may pay cash
dividends and make other distributions on our capital stock,
including the mandatory convertible preferred stock, only if
certain financial tests are met or certain exceptions are
available. Our ability to declare and pay dividends may also be
limited by Ohio law. See Risk Factors We may
not be able to pay cash dividends on the mandatory convertible
preferred stock. Dividends on the mandatory convertible
preferred stock will accrue and accumulate if we fail to pay one
or more dividends in any amount, whether or not declared and
whether or not we are then legally prohibited under Ohio law
from paying such dividends. Accumulations of dividends on shares
of the mandatory convertible preferred stock will not bear
interest.
No dividend will be declared or paid upon, or any sum set apart
for the payment of dividends upon, any outstanding share of the
mandatory convertible preferred stock with respect to any
dividend period unless all dividends for all preceding dividend
periods have been declared and paid or declared and a sufficient
sum has been set apart for the payment of such dividends, upon
all outstanding shares of mandatory convertible preferred stock.
In addition, no dividend may be paid upon or declared or set
apart for the mandatory convertible preferred stock at any time
unless, at the same time, a like proportionate dividend for the
dividend periods terminating on the same date or any earlier
date, ratably in proportion to the respective annual dividend
rates, shall have been paid upon or declared or funds therefor
set apart for all shares of preferred stock of all series then
issued and outstanding and entitled to receive such dividend.
If our board of directors or a duly authorized committee of our
board of directors determines not to pay any dividend or a full
dividend on a dividend payment date for the mandatory
convertible preferred stock, we will provide written notice to
the holders of the mandatory convertible preferred stock prior
to such dividend payment date.
Method of
Payment of Dividends
All dividends (or any portion of any dividend) on the mandatory
convertible preferred stock (whether for a current dividend
period or any prior dividend period, and including accrued and
unpaid dividends, payable upon conversion of the mandatory
convertible preferred stock pursuant to the provisions described
under Mandatory Conversion,
Conversion at the Option of the Holder,
Conversion Upon Fundamental Change and
Conversion at our Option Upon Nonpayment of
Dividends) will be paid in cash.
If you are a
non-U.S. holder
(as defined in Certain Material United States Federal
Income Tax Considerations), dividends generally will be
subject to U.S. federal income tax at a 30% or reduced
treaty rate, as described more fully under Certain
Material United States Federal Income Tax
Considerations
Non-U.S. Holders
Distributions on Preferred Stock and Common Stock. We will
withhold such U.S. federal income tax from amounts
otherwise payable to you.
The terms of our senior secured credit facilities and certain of
our outstanding debt securities may restrict our ability to
declare or pay dividends or distributions on our capital stock,
including the mandatory convertible preferred stock and our
common stock. Our ability to declare and pay dividends
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may also be limited by Ohio law. See Risk
Factors We may not be able to pay cash dividends on
the mandatory convertible preferred stock.
Payment
Restrictions
So long as any of our preferred stock, including any share of
the mandatory convertible preferred stock, remains outstanding,
no dividend, except a dividend payable in our common stock or
other shares ranking junior to our preferred stock, shall be
paid or declared or any distribution be made on our common stock
or any other shares ranking junior to our preferred stock, nor
shall any shares of our common stock, junior stock or parity
stock be purchased, retired or otherwise acquired by us (except
out of the proceeds of the sale of our common stock or other
shares ranking junior to our preferred stock received by us on
or subsequent to the issue date), unless (i) all accrued
and unpaid dividends upon all preferred stock (including the
mandatory convertible preferred stock) then outstanding payable
on all dividend payment dates occurring on or prior to the date
of such action shall have been declared and paid or funds
sufficient therefor set apart and (ii) at the date of such
action there shall be no arrearages with respect to the
redemption of our preferred stock of any series from any sinking
fund provided for shares of such series in accordance with the
provisions of our Amended Articles of Incorporation.
No dividend may be paid upon or declared or set apart for any
series of our preferred stock (including the mandatory
convertible preferred stock) at any time unless at the same time
a like proportionate dividend for the dividend periods
terminating on the same date or an earlier date, ratably in
proportion to the respective annual dividend rates, shall have
been paid upon or declared or funds therefore set apart for all
shares of preferred stock then issued and outstanding, including
the mandatory convertible preferred stock, and entitled to
receive such dividend.
Subject to the foregoing, and not otherwise, such dividends
(payable in cash, securities or other property) as may be
determined by our board of directors or any duly authorized
committee of our board of directors may be declared and paid on
any securities, including common stock and other junior stock,
from time to time out of any funds lawfully available for such
payment, and holders of the mandatory convertible preferred
stock shall not be entitled to participate in any such dividends.
Redemption
The mandatory convertible preferred stock will not be redeemable.
Liquidation
Preference
In the event of the voluntary or involuntary liquidation,
dissolution or winding up of our affairs, each holder of the
mandatory convertible preferred stock will be entitled to
receive in full out of our assets (including our capital)
available for distribution to our shareholders, subject to
rights of our creditors, before any payment or distribution is
made to holders of our common stock and any other shares ranking
junior to our preferred stock, the amount of $50.00 per share of
the mandatory convertible preferred stock, plus (i) an
amount equal to any accrued and unpaid dividends upon the shares
of the mandatory convertible preferred stock payable on all
dividend payment dates occurring on or prior to the date of
payment of the amount due pursuant to such liquidation,
dissolution or winding up, plus (ii) if such date is not a
dividend payment date, a proportionate dividend on the shares of
the mandatory convertible preferred stock, based on the number
of elapsed days, for the period from the day following the most
recent such dividend payment date through such date of payment
of the amount due pursuant to such liquidation, dissolution or
winding up.
In case our net assets legally available therefor are
insufficient to permit the payment upon all outstanding shares
of the mandatory convertible preferred stock and all other
series of preferred stock of the full preferential amount to
which they are respectively entitled, then such net assets shall
be distributed ratably upon all outstanding shares of mandatory
convertible preferred stock and all other series of preferred
stock in proportion to the full preferential amount to which
each such share is
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entitled. After payment of the full amount of the preferential
amounts as described above, holders of the mandatory convertible
preferred stock and such other preferred stock shall have no
right or claim to any of our remaining assets. Our merger or
consolidation into or with any other corporation, or the merger
of any other corporation into us, or the sale, lease or
conveyance of all or substantially all our property or business
shall not be deemed to be a dissolution, liquidation or winding
up for purposes of the distribution of any preferential amounts.
The certificate of amendment for the mandatory convertible
preferred stock will not contain any provision requiring funds
to be set aside to protect the liquidation preference of the
mandatory convertible preferred stock.
Voting
Rights
The holders of the mandatory convertible preferred stock will
have no voting rights except as set forth below or as otherwise
required from time to time by law, including by the Ohio General
Corporation Law, or our Amended Articles of Incorporation. In
matters where holders of the mandatory convertible preferred
stock are entitled to vote, each share of the mandatory
convertible preferred stock shall be entitled to one vote.
Preferred
Directors
Whenever, and so long as, the equivalent of six full quarterly
dividends (whether or not consecutive) remains unpaid on any
series of our preferred stock at the time outstanding, including
the mandatory convertible preferred stock (nonpayment of
dividends), whether or not earned or declared, the holders
of preferred stock of all series, voting separately as a class
without regard to series, shall be entitled to elect two members
to our board of directors; provided, however, that
the holders of the preferred stock shall not have or exercise
such special class voting rights except at meetings of such
shareholders for the election of directors at which the holders
of not less than a majority of the outstanding shares of
preferred stock of all series then outstanding are present in
person or by proxy; and provided, further, that such
special class voting rights, once vested, shall remain so vested
until all accrued and unpaid dividends on the preferred stock of
all series then outstanding shall have been paid, whereupon the
holders of preferred stock shall be divested of such special
class voting rights in respect of subsequent elections of
directors, subject to the revesting of such special class voting
rights in the event of the reoccurrence of the nonpayment of
dividends described above.
In the event that a nonpayment of dividends entitles the holders
of our preferred stock to elect two directors as specified
above, a special meeting of such holders for the purpose of
electing such directors shall be called by our secretary upon
written request of, or may be called by, the holders of record
of at least 10% of the shares of preferred stock of all series
at the time outstanding, and notice thereof shall be given in
the same manner as that required for the annual meeting of our
shareholders; provided, however, that we shall not be
required to call such special meeting if the annual meeting of
our shareholders shall be held within 120 days after the
date of receipt of the foregoing written request from the
holders of preferred stock.
At any meeting at which the holders of our preferred stock shall
be entitled to elect directors, the holders of a majority of the
then outstanding shares of preferred stock of all series,
present in person or by proxy, shall be sufficient to constitute
a quorum, and the vote of the holders of a majority of such
shares so present at any such meeting at which there shall be
such a quorum shall be sufficient to elect the members of the
board of directors which the holders of the preferred stock are
entitled to elect.
Notwithstanding any provision of our Amended Articles of
Incorporation or our Code of Regulations or any action taken by
the holders of any class of shares fixing the number of our
directors, the two directors who may be elected by the holders
of our preferred stock shall serve in addition to any other
directors then in office or proposed to be elected otherwise
than pursuant to the provisions described above. Nothing shall
prevent any change otherwise permitted in the total number of
our directors or require the resignation of any director elected
otherwise than pursuant to such provisions.
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Notwithstanding any classification of our other directors, the
two directors elected by the holders of our preferred stock
shall be elected annually for terms expiring at the next
succeeding annual meeting of our shareholders.
In the event of a nonpayment of dividends, if we elect to cause
a conversion as described under Conversion at
our Option Upon Nonpayment of Dividends, the rights of
holders of the mandatory convertible preferred stock to
participate in the election of two directors as set forth in the
preceding paragraphs effectively will be eliminated.
When a
Supermajority Vote is Required
The affirmative vote or consent of the holders of at least
two-thirds of the shares of our preferred stock at the time
outstanding (including the mandatory convertible preferred
stock), voting or consenting separately as a class, given in
person or by proxy either in writing or at a meeting called for
the purpose, shall be necessary to effect any one or more of the
following:
(i) any amendment, alteration or repeal of any of the
provisions of our Amended Articles of Incorporation or of our
Code of Regulations which adversely affects the preferences or
voting or other rights of the holders of our preferred stock
(including the mandatory convertible preferred stock);
provided, however, that for the purpose of clauses (i),
(ii) and (iii) of this section only, neither the
amendment of our Amended Articles of Incorporation so as to
authorize, create or change the authorized or outstanding amount
of preferred stock or of any shares of any class ranking on a
parity with or junior to our preferred stock (including the
mandatory convertible preferred stock), nor the amendment of the
provisions of our Code of Regulations so as to change the number
of our directors shall be deemed to affect adversely the
preferences or voting or other rights of the holders of our
preferred stock (including the mandatory convertible preferred
stock); and provided, further, that if such amendment,
alteration or repeal affects adversely the preferences or voting
or other rights of one or more but not all series of preferred
stock at the time outstanding, only the affirmative vote or
consent of the holders of at least two-thirds of the number of
the shares at the time outstanding of the series so affected
shall be required;
(ii) the purchase or redemption (for sinking fund purposes
or otherwise) of less than all of our preferred stock (including
any of the mandatory convertible preferred stock) then
outstanding except in accordance with a stock purchase offer
made to all holders of record of preferred stock, unless all
dividends on all preferred stock then outstanding for all
previous dividend periods shall have been declared and paid or
funds therefor set apart and all accrued sinking fund
obligations applicable thereto shall have been complied
with; or
(iii) the authorization, creation or the increase in the
authorized amount of any shares of any class or any security
convertible into shares of any class, in either case, ranking
prior to our preferred stock.
When a
Majority Vote is Required
The affirmative vote or consent of the holders of at least a
majority of the shares of our preferred stock at the time
outstanding (including the mandatory convertible preferred
stock), voting or consenting separately as a class, given in
person or by proxy either in writing or at a meeting called for
the purpose, shall be necessary to effect any one or more of the
following:
(i) the sale, lease or conveyance by us of all or
substantially all of our property or business;
(ii) our consolidation with or merger into any other
corporation, unless the corporation resulting from such
consolidation or surviving such merger will not have after such
consolidation or merger any class of shares either authorized or
outstanding ranking prior to or on a parity with our preferred
stock (including the mandatory convertible preferred stock)
except the same number of shares ranking prior to or on a parity
with our preferred stock (including the
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mandatory convertible preferred stock) and having the same
rights and preferences as the shares authorized and outstanding
immediately preceding such consolidation or merger (and each
holder of our preferred stock (including the mandatory
convertible preferred stock) immediately preceding such
consolidation or merger shall receive the same number of shares
with the same rights and preferences of the resulting or
surviving corporation); or
(iii) the authorization of any shares ranking on a parity
with our preferred stock or an increase in the authorized number
of shares of our preferred stock.
Neither the vote, consent nor any adjustment of the voting
rights of holders of our shares of the preferred stock
(including the mandatory convertible preferred stock) shall be
required for an increase in the number of shares of our common
stock authorized or issued or for stock splits of our common
stock or for stock dividends on any class of stock payable
solely in our common stock; and none of the foregoing actions
shall be deemed to affect adversely the preferences or voting or
other rights of our preferred stock (including the mandatory
convertible preferred stock).
Conversion
Conversion into shares of our common stock will occur on the
mandatory conversion date, unless you have converted your shares
of mandatory convertible preferred stock prior to the mandatory
conversion date in the manner described under
Conversion at the Option of the Holder,
or Conversion Upon Fundamental Change,
or we have elected to cause a conversion in the manner described
under Conversion at our Option Upon Nonpayment
of Dividends.
On the applicable conversion date, if shares of mandatory
convertible preferred stock are held in certificated form and
you have complied with some additional procedures set forth in
the certificate of amendment for the mandatory convertible
preferred stock, certificates representing shares of our common
stock will be issued and delivered to you or your designee upon
presentation and surrender of the certificate evidencing the
mandatory convertible preferred stock.
The person or persons entitled to receive the shares of our
common stock issuable upon conversion of the mandatory
convertible preferred stock will be treated as the record
holder(s) of such shares as of the close of business on the
applicable conversion date. Prior to the close of business on
the applicable conversion date, the shares of our common stock
issuable upon conversion of the mandatory convertible preferred
stock will not be deemed to be outstanding for any purpose and
you will have no rights with respect to such shares of common
stock, including without limitation, voting rights, rights to
respond to tender offers and rights to receive any dividends or
other distributions on our common stock, by virtue of holding
the mandatory convertible preferred stock.
In no event will the number of shares of our common stock
delivered upon conversion of the mandatory convertible preferred
stock exceed an amount per share equal to the product of
(i) and
(ii) the maximum conversion rate (as defined below),
subject to adjustment in the same manner as each fixed
conversion rate as set forth under Conversion
Rate Adjustments Adjustments to Fixed Conversion
Rates. We refer to this limitation as the share
cap. To the extent that we deliver the maximum number of
whole shares of common stock equal to the share cap on the
mandatory convertible preferred stock in accordance with the
provisions set forth below, we will be deemed to have paid in
full all cash amounts, including all accrued and unpaid
dividends, in respect of such mandatory convertible preferred
stock. However, in our sole discretion, we may elect to pay any
amount above the share cap that would otherwise be payable in
cash to the extent we have lawfully available funds to do so.
For purposes of this Description of Mandatory Convertible
Preferred Stock section, the following terms have the
meanings set forth below:
Volume Weighted Average Price or VWAP
per share of our common stock on any trading day means such
price as displayed under the heading Bloomberg VWAP
on Bloomberg (or any successor service) page GT
<Equity> AQR (or its equivalent successor if such page
is
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not available) in respect of the period from the scheduled open
to 4:00 p.m., New York City time, on such trading day; or,
if such price is not available, the volume weighted average
price means the market value per share of our common stock on
such trading day as determined, using a volume-weighted average
method, by a nationally recognized independent investment
banking firm retained by us for this purpose. Following a
reorganization event (as defined under
Recapitalizations, Reclassifications and
Changes of Our Common Stock) as a result of which the
mandatory convertible preferred stock becomes convertible into
exchange property (as defined under
Recapitalizations, Reclassifications and
Changes of Our Common Stock), the VWAP of any equity
security that is traded on a U.S. national securities
exchange and that constitutes a unit of or a portion of a unit
of exchange property will be calculated in accordance with the
foregoing definition, substituting the applicable Bloomberg page
for such equity security. The average VWAP means,
for any period, the average of the volume weighted average price
for each trading day in such period.
A trading day is any day on which
(i) there is no market disruption event (as defined below)
and (ii) the New York Stock Exchange is open for trading,
or, if our common stock (or any other equity security that is
traded on a U.S. national securities exchange and that
constitutes a unit of or a portion of a unit of exchange
property into which the mandatory convertible preferred stock
becomes convertible in connection with any reorganization event)
is not listed on the New York Stock Exchange, any day on which
the principal national securities exchange on which our common
stock (or such other security) is listed is open for trading,
or, if our common stock (or such other security) is not listed
on a national securities exchange, any business day. A
trading day only includes those days that have a
scheduled closing time of 4:00 p.m. (New York City time) or
the then standard closing time for regular trading on the
relevant exchange or trading system.
A market disruption event means any of the
following events that has occurred:
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any suspension of, or limitation imposed on, trading by the
relevant exchange or quotation system during any period or
periods aggregating one
half-hour or
longer and whether by reason of movements in price exceeding
limits permitted by the relevant exchange or quotation system or
otherwise relating to our common stock (or any other equity
security that is traded on a U.S. national securities
exchange and that constitutes a unit of or a portion of a unit
of exchange property into which the mandatory convertible
preferred stock becomes convertible in connection with any
reorganization event) or in futures or option contracts relating
to our common stock (or such other security) on the relevant
exchange or quotation system;
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any event (other than a failure to open or a closure as
described below) that disrupts or impairs the ability of market
participants during any period or periods aggregating one
half-hour or
longer in general to effect transactions in, or obtain market
values for, our common stock (or any other equity security that
is traded on a U.S. national securities exchange and that
constitutes a unit of or a portion of a unit of exchange
property into which the mandatory convertible preferred stock
becomes convertible in connection with any reorganization event)
on the relevant exchange or quotation system or futures or
options contracts relating to our common stock (or such other
security) on any relevant exchange or quotation system; or
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the failure to open of the exchange or quotation system on which
futures or options contracts relating to our common stock (or
any other equity security that is traded on a U.S. national
securities exchange and that constitute a unit of or a portion
of a unit of exchange property into which the mandatory
convertible preferred stock becomes convertible in connection
with any reorganization event) are traded or the closure of such
exchange or quotation system prior to its respective scheduled
closing time for the regular trading session on such day
(without regard to
after-hours
or other trading outside the regular
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trading session hours) unless such earlier closing time is
announced by such exchange or quotation system at least one hour
prior to the earlier of the actual closing time for the regular
trading session on such day and the submission deadline for
orders to be entered into such exchange or quotation system for
execution at the actual closing time on such day.
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Mandatory
Conversion
Each share of the mandatory convertible preferred stock, unless
previously converted, will automatically convert on
April 1, 2014 (the mandatory conversion date)
into a number of shares of our common stock equal to the
conversion rate described below. In addition to the common stock
issuable upon conversion of each share of our mandatory
convertible preferred stock on the mandatory conversion date,
holders will have the right to receive an amount in cash equal
to all accrued and unpaid dividends on the mandatory convertible
preferred stock, whether or not declared prior to that date, for
the then-current dividend period ending on the mandatory
conversion date and all prior dividend periods (other than
previously declared dividends on the mandatory convertible
preferred stock that were paid to holders of record as of a
prior date), so long as we are lawfully permitted to pay such
amounts at such time. If we fail to pay such cash amount for any
reason, the conversion rate applicable to such conversion of
mandatory convertible preferred stock will be adjusted as
provided under Conversion Rate
Adjustments Adjustment to Conversion Rate Upon
Conversion and the converting holders right to
receive such cash amount shall be extinguished upon conversion.
In no event shall the number of shares issued upon conversion of
the mandatory convertible preferred stock on the mandatory
conversion date exceed the share cap.
The conversion rate is the number of shares of common stock
issuable upon conversion of each share of the mandatory
convertible preferred stock on the applicable conversion date.
The conversion rate on the mandatory conversion date (the
mandatory conversion rate) will, subject to
adjustment as described under Conversion Rate
Adjustments below, be as follows:
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if the applicable market value of our common stock (as defined
below) is equal to or greater than
$ , which we call the
threshold appreciation price, then the conversion
rate will
be shares
of our common stock per share of mandatory convertible preferred
stock (the minimum conversion rate), which is equal
to $50.00 divided by the threshold appreciation price;
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if the applicable market value of our common stock is less than
the threshold appreciation price but greater than
$ , which we call the
initial price, then the conversion rate will be
equal to $50.00 divided by the applicable market value of our
common stock; or
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if the applicable market value of our common stock is less than
or equal to the initial price, then the conversion rate will
be shares
of common stock per share of mandatory convertible preferred
stock (the maximum conversion rate), which is equal
to $50.00, divided by the initial price.
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We refer to the minimum conversion rate and the maximum
conversion rate collectively as the fixed conversion
rates. Each of the fixed conversion rates, the initial
price and the threshold appreciation price are subject to
adjustment as described under Conversion Rate
Adjustments below.
Based on the foregoing, if the market price of our common stock
on the mandatory conversion date is the same as the applicable
market value of our common stock, the aggregate market value of
the shares of common stock you receive upon mandatory conversion
will be:
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greater than the liquidation preference of the mandatory
convertible preferred stock, if the applicable market value of
our common stock is greater than the threshold appreciation
price,
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equal to the liquidation preference, if the applicable market
value of our common stock is less than or equal to the threshold
appreciation price and greater than or equal to the initial
price, and
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less than the liquidation preference, if the applicable market
value of our common stock is less than the initial price.
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The applicable market value of our common stock is
the average VWAP per share of our common stock for the 20
consecutive trading-day period ending on, and including, the
third trading day immediately preceding the mandatory conversion
date.
As described under Recapitalizations,
Reclassifications and Changes of Our Common Stock,
following a reorganization event as a result of which the
mandatory convertible preferred stock becomes convertible into
exchange property, the applicable conversion rate in respect of
a mandatory conversion will be calculated based on the
applicable market value of a unit of exchange property (as
defined under Recapitalizations,
Reclassifications and Changes of Our Common Stock) rather
than the applicable market value of our common stock.
The initial price is $ . The
threshold appreciation price represents approximately
a % appreciation over the initial
price.
Conversion at the
Option of the Holder
Other than during the fundamental change conversion period (as
defined below) or following our issuance of a dividend
nonpayment conversion notice (as defined below), holders of the
mandatory convertible preferred stock have the right to convert
the mandatory convertible preferred stock, in whole or in part,
at any time prior to April 1, 2014, into shares of our
common stock at the minimum conversion rate
of shares
of our common stock per share of the mandatory convertible
preferred stock, subject to adjustment as described under
Conversion Rate Adjustments below.
In addition to the number of shares of common stock issuable at
the minimum conversion rate upon conversion of each share of
mandatory convertible preferred stock at the option of the
holder on any date on which a holder converts shares of
mandatory convertible preferred stock at such holders
option (the early conversion date), we will pay an
amount in cash equal to all accrued and unpaid dividends on such
converted share(s) of mandatory convertible preferred stock,
whether or not declared prior to that date, for all dividend
periods ending on or prior to the dividend payment date
immediately preceding the early conversion date (other than
previously declared dividends on the mandatory convertible
preferred stock that were paid to holders of record as of a
prior date), so long as we are then lawfully permitted to pay
such amounts at such time. If we fail to pay such cash amount
for any reason, the conversion rate applicable to such
conversion of mandatory convertible preferred stock will be
adjusted as provided under Conversion Rate
Adjustments Adjustment to Conversion Rate Upon
Conversion and the converting holders right to
receive such amount shall be extinguished upon conversion.
In no event shall the number of shares issued upon conversion of
the mandatory convertible preferred stock upon conversion at the
option of the holder exceed the share cap.
Notwithstanding the foregoing, if the early conversion date for
any optional conversion occurs during the period from
5:00 p.m., New York City time, on a regular record date for
any declared dividend to 9:00 a.m., New York City time, on
the immediately following dividend payment date, then:
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we will pay such dividend on the dividend payment date to the
holder of record of the converted share(s) of mandatory
convertible preferred stock on such regular record date;
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share(s) of mandatory convertible preferred stock surrendered
for conversion during such period must be accompanied by cash in
an amount equal to the amount of such dividend for the
then-current dividend period with respect to the share(s) so
converted; and
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S-34
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the consideration that we deliver to the converting holder on
the early conversion date will not include any consideration for
such dividend.
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Conversion Upon
Fundamental Change
If a fundamental change (as defined below) occurs prior to the
mandatory conversion date, we will provide for the conversion of
shares of the mandatory convertible preferred stock by paying or
delivering, as the case may be, to holders who convert their
shares of mandatory convertible preferred stock at any time
during the period (the fundamental change conversion
period) beginning on, and including, the effective date of
such fundamental change (the effective date) and
ending on, but excluding, the earlier of (i) the mandatory
conversion date and (ii) the date that is 20 days
after the effective date:
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a number of shares of our common stock (or units of exchange
property, if applicable), based on a conversion rate determined
in accordance with the provisions set forth under
Mandatory Conversion treating the
effective date as the mandatory conversion date for purposes of
calculating the applicable market value of our common stock (or
the applicable market value of a unit of exchange property in
the case of an effective date occurring subsequent to a
reorganization event as a result of which the mandatory
convertible preferred stock has become convertible into exchange
property);
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a number of additional shares of common stock (or units of
exchange property, if applicable) (additional
shares) determined as described below (the conversion rate
determined in accordance with the preceding paragraph, as
increased for any such additional shares, will be referred to as
the fundamental change conversion rate); and
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to the extent we are legally permitted to make such payment, the
sum of an amount in cash equal to (A) all accrued and
unpaid dividends, whether or not previously declared, on the
converted shares of mandatory convertible preferred stock to,
but not including, the effective date, and (B) the present
value, as of the effective date, of all remaining dividend
payments on the converted shares of mandatory convertible
preferred stock through, and including, the mandatory conversion
date (excluding accrued and unpaid dividends to the effective
date), computed as described below; provided, however,
that if (Y) the applicable conversion date occurs
during the period from 5:00 p.m., New York City time, on a
regular record date for any declared dividend to 9:00 a.m.,
New York City time, on the immediately following dividend
payment date, or (Z) a dividend payment date for any
declared dividend occurs after the effective date but before the
applicable conversion date, then, in each such case (but without
duplication), we will pay such dividend to the converting holder
on the applicable dividend payment date and the cash amount paid
to the converting holder upon conversion will be reduced by the
amount of such dividend. The present value of remaining
dividends will be discounted on a quarterly basis assuming a
360-day year
consisting of twelve
30-day
months at an annual discount rate
of %. If we fail to pay the cash
amount required by this paragraph, the conversion rate
applicable to such conversion of mandatory convertible preferred
stock will be adjusted as provided under
Conversion Rate Adjustments
Adjustment to Conversion Rate Upon Conversion and the
converting holders right to receive such amount shall be
extinguished upon conversion.
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We will notify holders, to the extent practicable, at least 20
business days prior to the anticipated effective date of such
fundamental change, but in any event not later than two business
days following our becoming aware of the occurrence of a
fundamental change (the fundamental change company
notice). Such fundamental change company notice will
state, among other things, the fundamental change conversion
rate, including the number of additional shares, and whether we
will pay the cash amount or whether the conversion rate will be
adjusted as provided under Conversion Rate
Adjustments Adjustment to Conversion Rate Upon
Conversion; provided, however, that if the fundamental
change conversion rate is not calculable at the time the
fundamental change company notice is sent to holders the notice
will instead disclose the method for calculating such rate. In
no
S-35
event shall the number of shares issued upon conversion of the
mandatory convertible preferred stock upon a fundamental change
exceed the share cap.
The number of additional shares will be determined by reference
to the table below based on the effective date of the
fundamental change and the stock price in the fundamental
change. The stock price will be:
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in the case of a fundamental change described in clause (2)
below in which the holders of our common stock receive only cash
in the fundamental change, the cash amount paid per share of our
common stock; and
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otherwise, the average VWAP per share of our common stock over
the five trading-day period ending on, and including, the
trading day immediately preceding the effective date of the
fundamental change.
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The stock prices set forth in the first row of the table (i.e.,
the column headers) below will be adjusted as of any date on
which the fixed conversion rates of the mandatory convertible
preferred stock are adjusted. The adjusted stock prices will
equal the stock prices applicable immediately prior to such
adjustment multiplied by a fraction, the numerator of which is
the minimum conversion rate immediately prior to the adjustment
giving rise to the stock price adjustment and the denominator of
which is the minimum conversion rate as so adjusted. The
additional shares shall be correspondingly adjusted in the same
manner as each fixed conversion rate as set forth under
Conversion Rate Adjustments
Adjustments to Fixed Conversion Rates.
In the case of a fundamental change that occurs subsequent to a
reorganization event as a result of which the mandatory
convertible preferred stock has become convertible into units of
exchange property, the stock price will be determined by
reference to the applicable market value of a unit of exchange
property (as defined under Recapitalizations,
Reclassifications and Changes of Our Common Stock).
The following table sets forth, the number of additional shares
issuable per $50.00 initial liquidation preference of the
mandatory convertible preferred stock based on the effective
date and stock price in the fundamental change:
Stock Price on
Effective Date
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Effective Date
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$
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$
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$
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$
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$
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$
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$
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$
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$
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$
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$
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$
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$
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$
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,
2011
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July 1, 2011
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October 1, 2011
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January 1, 2012
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April 1, 2012
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July 1, 2012
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October 1, 2012
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January 1, 2013
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April 1, 2013
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July 1, 2013
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October 1, 2013
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January 1, 2014
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April 1, 2014
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The exact stock price and effective date may not be set forth on
the table, in which case:
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if the stock price is between two stock price amounts on the
table or the effective date is between two dates on the table,
the number of additional shares will be determined by
straight-line interpolation between the number of additional
shares set forth for the higher
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S-36
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and lower stock price amounts and the two effective dates, as
applicable, based on a
365-day year;
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if the stock price is in excess of
$ per share (subject to adjustment
as described above), then no additional shares will be issued
upon conversion; and
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if the stock price is less than $
per share (subject to adjustment as described above), then no
additional shares will be issued upon conversion.
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Our obligation to deliver additional shares could be considered
a penalty, in which case the enforceability thereof would be
subject to general principles of reasonableness of economic
remedies.
A fundamental change will be deemed to have occurred
if any of the following occurs:
(1) a person or group within the
meaning of Section 13(d) of the Exchange Act has become the
direct or indirect beneficial owner, as defined in
Rule 13d-3
under the Exchange Act, of our common stock representing more
than 50% of the voting power of our common stock (other than in
connection with a transaction described in clause (2), in which
case clause (2) will apply);
(2) we are involved in a transaction (whether by means of a
consolidation with or merger into any other person, or a merger
of another person into us, or we sell, lease or transfer in one
transaction or a series of related transactions all or
substantially all of the property and assets of us and our
subsidiaries) or series of related transactions pursuant to
which (i) our common stock is exchanged for, converted into
or constitutes solely the right to receive cash, securities or
other property, and (ii) more than 10% of such cash,
securities or other property consists of securities that are
not, or upon issuance will not be, traded on the New York Stock
Exchange, the NASDAQ Global Select Market, the NASDAQ Global
Market or any successor to any of the foregoing;
(3) our common stock (or any other security into which the
mandatory convertible preferred stock becomes convertible in
connection with a reorganization event) ceases to be listed or
quoted on the New York Stock Exchange, the NASDAQ Global Select
Market, the NASDAQ Global Market or any successor to any of the
foregoing (other than in connection with a transaction described
in clause (2), in which case clause (2) shall
apply); or
(4) our stockholders approve any plan for our liquidation,
dissolution or termination.
Conversion at Our
Option Upon Nonpayment of Dividends
If we at any time have not paid the equivalent of six full
quarterly dividends (whether or not consecutive and whether or
not earned or declared) on any series of preferred stock at the
time outstanding, including the mandatory convertible preferred
stock, prior to the mandatory conversion date, we may at our
option cause all (but not less than all) shares of the mandatory
convertible preferred stock to be automatically converted into a
number of shares of our common stock based on the fundamental
change conversion rate determined as described below (the
dividend nonpayment conversion rate). In addition to
the number of shares of common stock issuable upon conversion of
each share of mandatory convertible preferred stock, we will pay
the sum of an amount in cash, to the extent we are legally
permitted to make such payment, equal to (A) all accrued
and unpaid dividends, whether or not previously declared, on the
converted shares of mandatory convertible preferred stock to,
but not including, the dividend nonpayment conversion date (as
defined below), and (B) the present value, as of the
dividend nonpayment conversion date, of all remaining dividend
payments on the converted shares of mandatory convertible
preferred stock through, and including, the mandatory conversion
date (excluding accrued and unpaid dividends to the dividend
nonpayment conversion date), computed as described below;
provided, however, that if the dividend
non-payment conversion date occurs during the period from
5:00 p.m., New York City time, on a regular record date for
any declared dividend to 9:00 a.m., New York City time, on
the immediately following dividend payment date, we will pay
such dividend on the applicable dividend payment date and the
cash amount paid to
S-37
holders upon conversion will be reduced by the amount of such
dividend. The present value of remaining dividends will be
discounted on a quarterly basis assuming a
360-day year
consisting of twelve
30-day
months at an annual discount rate
of %. If we fail to pay such cash
amount for any reason, the conversion rate applicable to such
conversion of mandatory convertible preferred stock will be
adjusted as provided under Conversion Rate
Adjustments Adjustment to Conversion Rate Upon
Conversion and the converting holders right to
receive such amount shall be extinguished upon conversion.
To exercise the conversion right described above, we must notify
the registered holders of the mandatory convertible preferred
stock by mail (the dividend nonpayment conversion
notice) prior to the close of business on the
45th trading day following the dividend payment date for
such sixth unpaid dividend. In addition, concurrently with such
mailing, we shall post the dividend nonpayment conversion notice
on our website. Failure to mail a notice or communication to a
holder or any defect in it shall not affect its sufficiency with
respect to other holders. If a notice or communication is mailed
in the manner provided in the certificate of amendment, it will
be deemed to have been duly given, whether or not the addressee
receives it. The conversion date will be a date selected by us
(which we will refer to as the dividend nonpayment
conversion date) that is no fewer than 10 and no more than
15 trading days after the date the dividend payment conversion
notice is sent to holders of the mandatory convertible preferred
stock. In addition to any information required by applicable law
or regulation, the dividend nonpayment conversion notice shall
state, as appropriate:
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the dividend nonpayment conversion date;
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the method for calculating the dividend nonpayment conversion
rate, including the number of additional shares;
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whether we will pay the cash amount in respect of accrued and
unpaid dividends or whether the dividend nonpayment conversion
rate has been adjusted as provided under
Conversion Rate Adjustments
Adjustment to Conversion Rate at Conversion; and
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that dividends on the shares of mandatory convertible preferred
stock will cease to accrue on the dividend nonpayment conversion
date.
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In no event shall the number of shares issued upon conversion of
the mandatory convertible preferred stock upon a nonpayment of
dividends exceed the share cap.
For purposes of determining the dividend nonpayment conversion
rate (including the number of additional shares to be issued) in
connection with a conversion at our option upon nonpayment of
dividends, the provisions set forth under
Conversion Upon Fundamental Change
applicable to the determination of the fundamental change
conversion rate shall apply except that (i) the
effective date will be the dividend nonpayment
conversion date and (ii) the stock price will
be the average VWAP per share of our common stock over the five
trading-day period beginning on, and including, the trading day
immediately following the date on which the dividend nonpayment
conversion notice is sent to holders of the mandatory
convertible preferred stock or, if the dividend nonpayment
conversion date occurs subsequent to a reorganization event as a
result of which the mandatory convertible preferred stock has
become convertible into units of exchange property, the
applicable market value of a unit of exchange property (as
defined under Recapitalizations,
Reclassifications and Changes of Our Common Stock).
Effect of
Conversion
Upon the conversion of any shares of mandatory convertible
preferred stock, dividends on such shares shall cease to accrue
and accumulate, such shares shall cease to be outstanding and
all rights of holders of such shares shall terminate, subject to
the right of such holders to receive the shares of our common
stock issuable upon conversion, any accrued and unpaid
dividends, the present value of any remaining dividends and cash
in lieu of fractional shares pursuant to
Fractional Shares below to which such
holders are otherwise entitled.
S-38
Fractional
Shares
No fractional shares of our common stock will be issued to
holders of the mandatory convertible preferred stock. In lieu of
any fractional shares of our common stock otherwise issuable in
respect of the aggregate number of shares of the mandatory
convertible preferred stock of any holder that are converted,
that holder will be entitled to receive an amount in cash at the
current market value thereof (computed to the nearest cent) on
the basis of the average VWAP per share of our common stock over
the 20 consecutive trading-day period ending on, and including,
the last trading day before the conversion date.
If more than one share of the mandatory convertible preferred
stock is surrendered for conversion at one time by or for the
same holder, the number of full shares of our common stock
issuable upon conversion thereof shall be computed on the basis
of the aggregate number of shares of the mandatory convertible
preferred stock so surrendered.
Conversion Rate
Adjustments
Adjustments to
Fixed Conversion Rates
Each fixed conversion rate will be adjusted from time to time as
follows:
(i) If we issue common stock as a dividend or distribution
to all or substantially all holders of our common stock, or if
we effect a subdivision or combination (including, without
limitation, a reverse stock split) of our common stock, each
fixed conversion rate will be adjusted based on the following
formula:
CR1 = CR0
x
(OS1/OS0)
where,
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CR0 =
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the fixed conversion rate in effect immediately prior to the
close of business on the record date (as defined below) for such
dividend or distribution or immediately prior to the open of
business on the effective date for such subdivision or
combination, as the case may be;
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CR1 =
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the fixed conversion rate in effect immediately after the close
of business on such record date or immediately after the open of
business on such effective date, as the case may be;
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OS0 =
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the number of shares of our common stock outstanding immediately
prior to the close of business on such record date or
immediately prior to the open of business on such effective
date, as the case may be (and prior to giving effect to such
event); and
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OS1 =
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the number of shares of our common stock that would be
outstanding immediately after, and solely as a result of, such
dividend, distribution, subdivision or combination.
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Any adjustment made under this clause (i) will become
effective immediately after the close of business on the record
date for such dividend or distribution, or immediately after the
open of business on the effective date for such subdivision or
combination, as the case may be. If any dividend, distribution,
subdivision or combination of the type described in this
clause (i) is declared but not so paid or made, each fixed
conversion rate will be immediately readjusted, effective as of
the earlier of (a) the date our board of directors or a
duly authorized committee thereof determines not to pay or make
such dividend, distribution, subdivision or combination and
(b) the date the dividend or distribution was to be paid or
the date the subdivision or combination was to have been
effective, to the fixed conversion rate that would then be in
effect if such dividend, distribution, subdivision or
combination had not been declared.
(ii) If we issue to all or substantially all holders of our
common stock any rights, options or warrants (other than
pursuant to any shareholder rights plan) entitling them for a
period expiring
S-39
60 days or less from the date of issuance of such rights,
options or warrants to subscribe for or purchase shares of our
common stock at less than the current market price (as defined
below) per share of common stock as of the announcement date for
such issuance, each fixed conversion rate will be increased
based on the following formula:
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CR1 =
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CR0
x
(OS0
+
X)/(OS0
+ Y)
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where,
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CR0 =
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the fixed conversion rate in effect immediately prior to the
close of business on the record date for such issuance;
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CR1 =
|
the fixed conversion rate in effect immediately after the close
of business on such record date;
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OS0 =
|
the number of shares of our common stock outstanding immediately
prior to the close of business on such record date;
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X =
|
the total number of shares of our common stock issuable pursuant
to such rights, options or warrants; and
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Y =
|
the aggregate price payable to exercise such rights, options or
warrants, divided by the average VWAP per share of our
common stock for the 10 consecutive trading-day period ending
on, and including, the trading day immediately preceding the
date of announcement for such issuance.
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Any increase in the fixed conversion rates made pursuant to this
clause (ii) will become effective immediately after the
close of business on the record date for such issuance. To the
extent such rights, options or warrants are not exercised prior
to their expiration or termination, each fixed conversion rate
will be decreased, effective as of the date of such expiration
or termination, to the fixed conversion rate that would then be
in effect had the increase with respect to the issuance of such
rights, options or warrants been made on the basis of delivery
of only the number of shares of our common stock actually
delivered. If such rights, options or warrants are not so
issued, each fixed conversion rate will be decreased, effective
as of the earlier of (a) the date our board of directors or
a duly authorized committee thereof determines not to issue such
rights, options or warrants and (b) the date such rights,
options or warrants were to have been issued, to the fixed
conversion rate that would then be in effect if such record date
for such issuance had not occurred.
For purposes of this clause (ii), in determining whether any
rights, options or warrants entitle the holders thereof to
subscribe for or purchase shares of our common stock at less
than the current market price per share of our common stock as
of the announcement date for such issuance, and in determining
the aggregate price payable to exercise such rights, options or
warrants, there will be taken into account any consideration we
receive for such rights, options or warrants and any amount
payable on exercise thereof, with the value of such
consideration, if other than cash, to be determined by our board
of directors or a duly authorized committee thereof.
(iii) If we pay a dividend or other distribution to all or
substantially all holders of our common stock of shares of our
capital stock (other than our common stock), evidences of our
indebtedness, our assets or other property or rights to acquire
our capital stock, our indebtedness or our assets or other
property, excluding:
(a) any dividend, distribution or issuance as to which an
adjustment was effected pursuant to clause (i) or
(ii) above;
(b) dividends or distributions paid exclusively in cash as
to which an adjustment was effected pursuant to clause (iv)
below; and
(c) spin-offs as to which the provisions set
forth below in this clause (iii) apply,
then each fixed conversion rate will be increased based on the
following formula:
S-40
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CR1 =
|
CR0
x
SP0/(SP0
FMV)
|
where,
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|
CR0 =
|
the fixed conversion rate in effect immediately prior to the
close of business on the record date for such dividend or
distribution;
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|
|
CR1 =
|
the fixed conversion rate in effect immediately after the close
of business on such record date;
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|
|
|
SP0 =
|
the current market price per share of our common stock as of
such record date; and
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|
|
FMV =
|
the fair market value (as determined in good faith by our board
of directors or a duly authorized committee thereof) on the
record date for such dividend or distribution of shares of our
capital stock (other than our common stock), evidences of our
indebtedness, our assets or other property or rights to acquire
our capital stock, our indebtedness or our assets or other
property, expressed as an amount per share of our common stock.
|
If our board of directors or a duly authorized committee thereof
determines the FMV (as defined above) of any
dividend or other distribution for purposes of this
clause (iii) by referring to the actual or when-issued
trading market for any securities, it will in doing so consider
the prices in such market over the same period used to determine
the current market price per share of our common stock as of the
record date for such dividend or other distribution.
Notwithstanding the foregoing, if FMV (as defined
above) is equal to or greater than
SPo
(as defined above), in lieu of the foregoing increase, each
holder of mandatory convertible preferred stock will receive, in
respect of each share thereof, at the same time and upon the
same terms as holders of our common stock receive the shares of
our capital stock (other than our common stock), evidences of
our indebtedness, our assets or other property or rights to
acquire our capital stock, our indebtedness or our assets or
other property that such holder would have received if such
holder owned a number of shares of our common stock equal to the
maximum conversion rate in effect immediately prior to the close
of business on the record date for such dividend or other
distribution.
Any increase made under the portion of this clause (iii)
above will become effective immediately after the close of
business on the record date for such dividend or other
distribution. If such dividend or other distribution is not so
paid or made, each fixed conversion rate will be decreased,
effective as of the earlier of (a) the date our board of
directors or a duly authorized committee thereof determines not
to pay the dividend or other distribution and (b) the date
such dividend or distribution was to have been paid, to the
fixed conversion rate that would then be in effect if the
dividend or other distribution had not been declared.
Notwithstanding the foregoing, if the transaction that gives
rise to an adjustment pursuant to this clause (iii) is one
pursuant to which the payment of a dividend or other
distribution on our common stock consists of shares of capital
stock of, or similar equity interests in, a subsidiary or other
business unit of ours (i.e., a spin-off) that are, or, when
issued, will be, traded on a U.S. national securities
exchange, then each fixed conversion rate will instead be
increased based on the following formula:
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CR1 =
|
CR0
x
(FMV0
+
MP0)/MP0
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where,
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CR0 =
|
the fixed conversion rate in effect at the close of business on
the tenth trading day immediately following, and including, the
date on which ex-dividend trading commences for such
dividend or distribution on the relevant exchange;
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CR1 =
|
the fixed conversion rate in effect immediately after the close
of business on the tenth trading day immediately following, and
including, the date on which ex-dividend trading
commences for such dividend or distribution on the relevant
exchange;
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S-41
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FMV0 =
|
the average VWAP per share of such capital stock or similar
equity interests distributed to holders of our common stock
applicable to one share of our common stock for the 10
consecutive trading-day period commencing on, and including, the
date on which ex-dividend trading commences for such
dividend or distribution on the relevant exchange; and
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|
|
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MP0 =
|
the average VWAP per share of our common stock over the 10
consecutive
trading-day
period commencing on, and including, the date on which
ex-dividend trading commences for such dividend or
distribution on the relevant exchange.
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The adjustment to each fixed conversion rate under the
immediately preceding paragraph will occur at the close of
business on the 10th consecutive trading day immediately
following, and including, the date on which ex-dividend
trading commences for such dividend or distribution on the
relevant exchange, but will be given effect as of the open of
business on the date immediately succeeding the record date for
such dividend or distribution on the relevant exchange. Because
we will make the adjustments to the fixed conversion rates at
the end of the 10 consecutive trading-day period with
retroactive effect, we will delay the settlement of any
conversion of the mandatory convertible preferred stock if the
conversion date occurs after the record date for such dividend
or other distribution and prior to the end of such 10
consecutive trading-day period. In such event, we will deliver
the shares of our common stock issuable in respect of such
conversion (based on the adjusted fixed conversion rates as
described above) on the first business day immediately following
the last trading day of such 10 consecutive trading-day period.
(iv) If we pay a distribution consisting exclusively of
cash to all or substantially all holders of our common stock,
excluding (a) any cash that is distributed as part of a
dividend or distribution referred to in clause (iii) above
and (b) any consideration payable in connection with a
tender or exchange offer made by us or any of our subsidiaries
referred to in clause (v) below, each fixed conversion rate
will be increased based on the following formula:
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|
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CR1 =
|
CR0
x
SP0/(SP0
C)
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where,
|
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|
|
CR0 =
|
the fixed conversion rate in effect immediately prior to the
close of business on the record date for such distribution;
|
|
|
CR1 =
|
the fixed conversion rate in effect immediately after the close
of business on the record date for such distribution;
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|
|
|
SP0 =
|
the current market price per share of our common stock as of the
record date for such distribution; and
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C =
|
the amount of cash per share of our common stock we distribute
to holders of our common stock.
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The adjustment to the fixed conversion rates pursuant to this
clause (iv) will become effective immediately after the
close of business on the record date for such distribution.
Notwithstanding the foregoing, if C (as defined
above) is equal to or greater than
SPo
(as defined above), in lieu of the foregoing increase, each
holder of mandatory convertible preferred stock will receive, in
respect of each share thereof, at the same time and upon the
same terms as holders of shares of our common stock, the amount
of cash that such holder would have received if such holder
owned a number of shares of our common stock equal to the
maximum conversion rate in effect immediately prior to the close
of business on the record date for such or distribution. If such
distribution is not so paid, the fixed conversion rates will be
decreased, effective as of the earlier of (a) the date our
board of directors or a duly authorized committee thereof
determines not to pay such dividend and (b) the date such
dividend was to have been paid, to the fixed conversion rates
that would then be in effect if such distribution had not been
declared.
S-42
(v) If we or one or more of our subsidiaries purchases our
common stock pursuant to a tender offer or exchange offer and
the cash and value of any other consideration included in the
payment per share of our common stock validly tendered or
exchanged exceeds the average VWAP per share of our common stock
over the 10 consecutive trading-day period commencing on, and
including, the trading day next succeeding the last date on
which tenders or exchanges may be made pursuant to such tender
or exchange offer (the expiration date), each fixed
conversion rate will be increased based on the following formula:
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|
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CR1 =
|
CR0
x (FMV +
(SP1 x
OS1))/(SP1x
OS0)
|
where,
|
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|
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CR0 =
|
the fixed conversion rate in effect immediately prior to the
close of business on the 11th trading day immediately
following the expiration date;
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CR1 =
|
the fixed conversion rate in effect immediately after the close
of business on the 11th trading day immediately following
the expiration date;
|
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|
|
|
FMV =
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the fair market value (as determined in good faith by our board
of directors or a duly authorized committee thereof) as of the
expiration date of the aggregate value of all cash and any other
consideration paid or payable for shares of our common stock
validly tendered or exchanged and not withdrawn as of the
expiration date (the purchased shares);
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OS1 =
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the number of shares of our common stock outstanding as of the
last time tenders or exchanges may be made pursuant to such
tender or exchange offer (the expiration time), less
any purchased shares;
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OS0 =
|
the number of shares of our common stock outstanding at the
expiration time, including any purchased shares; and
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|
|
|
SP1 =
|
the average VWAP per share of our common stock over the 10
consecutive
trading-day
period commencing on, and including, the trading day next
succeeding the expiration date.
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The adjustment to each fixed conversion rate under the
immediately preceding paragraph will occur at the close of
business on the 11th consecutive trading day immediately
following the expiration date, but will be given effect as of
the open of business on the expiration date. Because we will
make the adjustments to the fixed conversion rates at the end of
the 10 consecutive trading-day period with retroactive effect,
we will delay the settlement of any conversion of mandatory
convertible preferred stock if the conversion date occurs during
such 10 consecutive trading-day period. In such event, we will
deliver the shares of our common stock issuable in respect of
such conversion (based on the adjusted fixed conversion rates as
described above) on the first business day immediately following
the last trading day of such 10 consecutive trading-day period.
Record date means, for purpose of a
conversion rate adjustment, with respect to any dividend,
distribution or other transaction or event in which the holders
of our common stock (or any other equity security constituting a
unit of or a portion of a unit of exchange property into which
the mandatory convertible preferred stock becomes convertible in
connection with any reorganization event) have the right to
receive any cash, securities or other property or in which our
common stock (or such other equity security) is exchanged for or
converted into any combination of cash, securities or other
property, the date fixed for determination of holders of our
common stock (or such other equity security) entitled to receive
such cash, securities or other property (whether such date is
fixed by our board of directors (or the board of directors of
any successor to us) or by statute, contract or otherwise).
Current market price of our common
stock on any day means the average VWAP per share
of our common stock (or any other equity security traded on a
U.S. national securities exchange
S-43
constituting a unit of or a portion of a unit of exchange
property into which the mandatory convertible preferred stock
becomes convertible in connection with any reorganization event)
for the ten consecutive trading-day period ending on the earlier
of the day in question and the day before the ex-date or other
specified date with respect to the issuance or distribution
requiring such computation, appropriately adjusted to take into
account the occurrence during such period of any event described
in clauses (i) through (v) above. For purposes of the
foregoing, ex-date means the first date on which the
shares of our common stock (or such other equity security) trade
on the applicable exchange or in the applicable market, regular
way, without the right to receive the issuance or distribution
in question from us or, if applicable, from the seller of our
common stock (or such other equity security) (in the form of due
bills or otherwise) as determined by such exchange or market.
In the case of any equity security that is not traded on a
U.S. national securities exchange and that constitutes a
unit of or a portion of a unit of exchange property
current market price of our common stock shall mean
the value of each share of such equity security as determined in
good faith by our board of directors (or the board of directors
of any successor to us) or a duly authorized committee thereof.
If we have in effect a shareholder rights plan while any shares
of mandatory convertible preferred stock remain outstanding,
holders of the mandatory convertible preferred stock will
receive, upon a conversion of mandatory convertible preferred
stock, in addition to common stock, rights under our shareholder
rights agreement unless, prior to such conversion, the rights
have expired, terminated or been redeemed or unless the rights
have separated from our common stock. If the rights provided for
in our rights plan have separated from our common stock in
accordance with the provisions of the applicable shareholder
rights agreement so that holders of the mandatory convertible
preferred stock would not be entitled to receive any rights in
respect of our common stock, if any, that we are required to
deliver upon conversion of mandatory convertible preferred
stock, each fixed conversion rate will be adjusted at the time
of separation as if we had distributed to all holders of our
common stock, capital stock (other than our common stock),
evidences of our indebtedness, our assets or rights to acquire
our capital stock, our indebtedness or our assets pursuant to
paragraph (iii) above, subject to readjustment upon the
subsequent expiration, termination or redemption of the rights.
A distribution of rights pursuant to a shareholder rights plan
will not trigger a conversion rate adjustment pursuant to
paragraphs (ii) or (iii) above. We currently do not
have a shareholder rights plan in effect.
No adjustment to the fixed conversion rates need be made if
holders of the mandatory convertible preferred stock participate
in the transaction that would otherwise require an adjustment
(other than in the case of a share split or share combination),
at the same time, upon the same terms and otherwise on the same
basis as holders of our common stock and solely as a result of
holding mandatory convertible preferred stock, as if such
holders held a number of shares of our common stock equal to the
maximum conversion rate as of the record date for such
transaction, multiplied by the number of shares of mandatory
convertible preferred stock held by such holders.
The fixed conversion rates will not be adjusted upon certain
events, including but not limited to:
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|
the issuance of any shares of our common stock pursuant to any
present or future plan providing for the reinvestment of
dividends or interest payable on our securities and the
investment of additional optional amounts in our common stock
under any plan;
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|
the issuance of any shares of our common stock or options or
rights to purchase those shares pursuant to any present or
future employee, director or consultant benefit plan, employee
agreement or arrangement or program of ours;
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|
the issuance of any shares of our common stock pursuant to any
option, warrant, right, or exercisable, exchangeable or
convertible security outstanding as of the issue date;
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|
a change solely in the par value of our common stock; and
|
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|
|
as a result of a tender offer solely to holders of fewer than
100 shares of our common stock.
|
S-44
The fixed conversion rates shall not be adjusted pursuant to the
provisions set forth above under Adjustment to
Fixed Conversion Rates in the case of a reorganization
event as a result of which the mandatory convertible preferred
stock becomes convertible into exchange property pursuant to the
provisions set forth under Recapitalizations,
Reclassifications and Changes of Our Common Stock if the
effect of such adjustment would be duplicative.
No adjustment in the fixed conversion rates will be required
unless the adjustment would require an increase or decrease of
at least 1% of the fixed conversion rates. If the adjustment is
not made because the adjustment does not change the fixed
conversion rates by at least 1%, then the adjustment that is not
made will be carried forward and taken into account in any
future adjustment. All required calculations will be made to the
nearest cent or 1/10,000th of a share. Notwithstanding the
foregoing, all adjustments not previously made shall be made
upon any conversion of mandatory convertible preferred stock.
Adjustments to the fixed conversion rates, or failure to make
certain adjustments, may result for U.S. federal income tax
purposes in a taxable deemed distribution to the beneficial
owners of mandatory convertible preferred stock. See
Certain Material United States Federal Income Tax
Considerations Taxation of
U.S. Holders Adjustment to Conversion
Rate.
In addition, we may make such increases in each fixed conversion
rate as we deem advisable in order to avoid or diminish any
income tax to holders of our common stock resulting from any
dividend or distribution of our shares (or issuance of rights or
warrants to acquire our shares) or from any event treated as
such for income tax purposes or for any other reason. We may
only make such a discretionary adjustment if we make the same
proportionate adjustment to each fixed conversion rate.
We will be required, as soon as practicable after a fixed
conversion rate is adjusted pursuant to the above provisions, to
provide or cause to be provided written notice of the adjustment
to the holders of shares of mandatory convertible preferred
stock. We will also be required to deliver a statement setting
forth in reasonable detail the method by which the adjustment to
each fixed conversion rate was determined and setting forth each
revised fixed conversion rate.
If an adjustment is made to the fixed conversion rates pursuant
to the above provisions, an inversely proportional adjustment
also will be made to the threshold appreciation price and the
initial price solely for the purposes of determining which
clauses of the definition of the mandatory conversion rate will
apply on the mandatory conversion date. Because the applicable
market value of our common stock is an average VWAP per share of
our common stock (or unit of or a portion of a unit of exchange
property, if applicable) over a period of trading days we will
make appropriate adjustments to the average VWAP per share (or
unit of or portion of a unit of exchange property, if
applicable) to account for any adjustments to the fixed
conversion rates that become effective during the period in
which the applicable market value is being calculated.
Adjustment to
Conversion Rate Upon Conversion
If, prior to the conversion of any shares of mandatory
convertible preferred stock, we have not informed converting
holders of our intention to pay and at the time of settlement of
such conversion do not so pay any cash amounts required to be
paid upon such conversion (as set forth under
Mandatory Conversion,
Conversion at the Option of the Holder,
Conversion Upon Fundamental Change or
Conversion at our Option Upon Nonpayment of
Dividends, as applicable), the conversion rate applicable
to the conversion of such shares of mandatory convertible
preferred stock (and only to the conversion of such shares) will
be increased based on the following formula:
where,
|
|
|
|
CR0 =
|
the conversion rate in effect immediately prior to such
conversion date;
|
|
|
CR1 =
|
the conversion rate in effect for purposes of such conversion;
|
S-45
|
|
|
|
D =
|
the unpaid cash amount due with respect to the shares being
converted divided by the number of shares being
converted; and
|
|
|
SP1 =
|
the average VWAP per share of our common stock over the 10
consecutive
trading-day
period ending on, and including, the trading day immediately
preceding the conversion date.
|
The adjustment to the applicable conversion rate under the
immediately preceding paragraph will be given effect as of, and
apply to conversion on, the applicable conversion date.
An adjustment to a conversion rate under this section, may
result for U.S. federal income tax purposes in a deemed
distribution to the beneficial owners of mandatory convertible
preferred stock. See Certain Material United States
Federal Income Tax Considerations Taxation of
U.S. Holders.
Recapitalizations,
Reclassifications and Changes of Our Common Stock
In the event of:
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|
any recapitalization, reclassification or change of our common
stock (other than changes only in par value or resulting from a
subdivision or combination);
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|
any consolidation or merger of us with or into another person;
|
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|
any sale, transfer, lease or conveyance to another person of all
or substantially all the property and assets of us and our
subsidiaries; or
|
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|
|
any statutory exchange of our securities with another person
(other than in connection with a merger or acquisition);
|
in each case, as a result of which the shares of our common
stock are exchanged for, or converted into, other securities,
property or assets (including cash or any combination thereof)
(any such event, a reorganization event), then, at
and after the effective time of such reorganization event, each
share of the mandatory convertible preferred stock outstanding
immediately prior to such reorganization event will, without the
consent of the holders of the mandatory convertible preferred
stock, become convertible into the type of such other
securities, property or assets (including cash or any
combination thereof) that a holder of a share of the mandatory
convertible preferred stock would have received if such holder
had converted its mandatory convertible preferred stock
immediately prior to such reorganization event (the
exchange property).
If a conversion date with respect to the mandatory convertible
preferred stock occurs after a reorganization event, each share
of mandatory convertible preferred stock will convert into an
amount of exchange property equal to the product of (i) the
applicable conversion rate then in effect and (ii) one unit
of exchange property (as defined below), without interest
thereon and without any right to dividends or distributions
thereon. For the purposes of the foregoing, one unit of
exchange property shall mean the type and amount of
exchange property received per share of our common stock in such
reorganization event. In the case of any reorganization event
that causes our common stock to be exchanged for or converted
into the right to receive more than a single type of
consideration determined in part upon any form of stockholder
election, the type and amount of consideration that a holder of
the mandatory convertible preferred stock would have been
entitled to receive as a holder of our common stock will be
deemed to be the weighted average of the type and amount of
consideration received by holders of our common stock that
affirmatively make such an election. For purposes of the
foregoing, the applicable conversion rate shall be (i) in
the case of a mandatory conversion on the mandatory conversion
date, the mandatory conversion rate determined using the
applicable market value of a unit of exchange property (as
defined below) instead of the applicable market value of our
common stock, (ii) in the case of a conversion at the
option of the holder, the minimum conversion rate, and
(iii) in the case of a conversion upon a fundamental change
or at our option upon nonpayment of dividends, the fundamental
change conversion rate or dividend nonpayment conversion rate,
as the case may be, determined using the applicable market value
of a unit of exchange property instead of the applicable
S-46
market value of our common stock. In the event of a mandatory
conversion on the mandatory conversion date or a conversion at
the option of the holder, applicable market value of a
unit of exchange property shall be: (i) in the case
of equity securities that are traded on a U.S. national
securities exchange, the average VWAP per share or other single
unit of such securities for the 20 consecutive trading-day
period ending on, and including, the third trading day
immediately preceding the applicable conversion date,
(ii) in the case of cash, the amount of such cash, and
(iii) in the case of any other property, as determined in
good faith by our board of directors (or the board of directors
of any successor to us) or a duly authorized committee thereof.
In the event of a conversion upon a fundamental change or a
conversion at our option upon nonpayment of dividends,
applicable market value of a unit of exchange
property shall be determined as described above, except
that the value of any equity securities that are traded on a
U.S. national securities exchange shall be the average VWAP
per share or other single unit of such securities for either
(Y) the five trading-day period ending on, and including,
the trading day immediately preceding the effective date of the
fundamental change or (Z) the five trading-day period
ending on, and including, the trading day immediately following
the date on which the dividend nonpayment conversion notice is
sent, as applicable.
The above provisions of this section will similarly apply to
successive reorganization events and the
Conversion Rate Adjustments section will
apply to any shares of our capital stock (or any other equity
security) received by the holders of our common stock in any
such reorganization event. For purposes of the conversion rate
adjustments set forth above under Conversion
Rate Adjustments, following a reorganization event as a
result of which the mandatory convertible preferred stock
becomes convertible into units of exchange property, references
to our common stock shall be deemed to be references to each
equity security constituting a unit of or a portion of a unit of
exchange property and references to the conversion rate shall be
deemed to refer to, and adjustments to the conversion rate shall
be applied to, each such equity security and not to any other
property constituting a portion of a unit of exchange property.
We (or any successor of us) will, as soon as reasonably
practicable (but in any event within 20 days) after the
occurrence of any reorganization event, provide written notice
to the holders of the mandatory convertible preferred stock of
such occurrence of such event and of the type and amount of the
cash, securities or other property that constitute the exchange
property. Failure to deliver such notice will not affect the
operation of this section.
Miscellaneous
We will at all times reserve and keep available, free from
preemptive rights, out of the authorized and unissued shares or
treasury shares, solely for issuance upon the conversion of the
mandatory convertible preferred stock, that number of shares of
our common stock as shall from time to time be sufficient to
permit the conversion of all outstanding shares of all
convertible series of preferred stock.
We are authorized to purchase any shares of any series of
preferred stock from time to time and at such times, in such
manner, for such reasons and on such terms and conditions as
shall be deemed appropriate by our board of directors.
Book-Entry,
Delivery and Form
The certificates representing the mandatory convertible
preferred stock will be issued in fully registered form
registered in the name of Cede & Co., the partnership
nominee of The Depository Trust Company, or DTC, or such
other name as may be requested by an authorized representative
of DTC. Ownership of beneficial interests in a global security
will be limited to persons who have accounts with DTC
(participants) or persons who hold interests through
such participants. Ownership of beneficial interests in a global
security will be shown on, and the transfer of that ownership
will be effected only through, records maintained by DTC or its
nominee (with respect to interests of participants) and the
records of participants (with respect to interests of persons
other than participants).
S-47
So long as DTC, or its nominee, is the registered owner or
holder of a global security, DTC or such nominee, as the case
may be, will be considered the sole owner or holder of the
mandatory convertible preferred stock represented by such global
security for all purposes under our Amended Articles of
Incorporation and the securities. No beneficial owner of an
interest in a global security will be able to transfer that
interest except in accordance with the applicable procedures of
DTC in addition to those provided for under our Amended Articles
of Incorporation.
Payments of dividends on the global security will be made to DTC
or its nominee, as the case may be, as the registered owner
thereof. None of us, the transfer agent, registrar, redemption,
conversion or dividend disbursing 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 a global security or for maintaining, supervising
or reviewing any records relating to such beneficial ownership
interests.
We expect that DTC or its nominee, upon receipt of any payment
of dividends in respect of a global security, will credit
participants accounts with payments in amounts
proportionate to their respective beneficial interests in the
principal amount of such global security as shown on the records
of DTC or its nominee, as the case may be. We also expect that
payments by participants to owners of beneficial interests in
such global security held through such participants will be
governed by standing instructions and customary practices, as is
now the case with securities held for the accounts of customers
registered in the names of nominees for such customers. Such
payments will be the responsibility of such participants.
Transfers between participants in DTC will be effected in the
ordinary way in accordance with DTC rules and will be settled in
same-day
funds.
We understand that DTC is:
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a limited purpose trust company organized under the laws of the
State of New York;
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a banking organization within the meaning of New
York Banking Law;
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a member of the Federal Reserve System;
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a clearing corporation within the meaning of the
Uniform Commercial Code; and
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a Clearing Agency registered pursuant to the
provisions of Section 17A of the Exchange Act.
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DTC was created to hold securities for its participants and
facilitate the clearance and settlement of securities
transactions between participants through electronic book-entry
changes in accounts of its participants, thereby eliminating the
need for physical movement of certificates. Participants include:
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securities brokers and dealers;
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banks, trust companies; and
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clearing corporations and certain other organizations.
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Indirect access to the DTC system is available to others such as
banks, brokers, dealers and trust companies that clear through
or maintain a custodial relationship with a participant, either
directly or indirectly (indirect participants).
Although DTC is expected to follow the foregoing procedures in
order to facilitate transfers of interests in a global security
among its participants, it is under no obligation to perform or
continue to perform such procedures, and such procedures may be
discontinued at any time. None of us, the transfer agent,
registrar, redemption, conversion or dividend disbursing agent
will have any responsibility for the performance by DTC or its
participants or indirect participants of their respective
obligations under the rules and procedures governing their
operations.
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If DTC is at any time unwilling or unable to continue as a
depositary for the global security or DTC ceases to be a
clearing agency registered under the Exchange Act
and, in each case, a qualified successor depositary is not
appointed by us within 90 days, we will issue certificated
shares in exchange for the global securities. Holders of an
interest in a global security may receive certificated shares,
at the option of the Company, in accordance with the rules and
procedures of DTC in addition to those provided for under our
Amended Articles of Incorporation. Beneficial interests in
global securities held by any direct or indirect participant may
also be exchanged for certificated shares upon request to DTC by
such direct participant (for itself or on behalf of an indirect
participant), to the transfer agent in accordance with their
respective customary procedures.
The information in this section concerning DTC and its
book-entry system has been obtained from sources that we believe
to be reliable, but we take no responsibility for the accuracy
thereof.
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DESCRIPTION OF
CAPITAL STOCK
This section contains a description of the material terms of
our capital stock. The following description is based on our
Amended Articles of Incorporation, our code of regulations, as
amended (Code of Regulations), and applicable
provisions of Ohio law. This summary is not complete. Our
Amended Articles of Incorporation and Code of Regulations are
exhibits to the registration statement of which this prospectus
supplement forms a part. You should read our Amended Articles of
Incorporation and Code of Regulations for the provisions that
are important to you.
Authorized
Shares
Our authorized capital stock consists of:
450,000,000 shares of common stock, without par
value; and
50,000,000 shares of preferred stock, issuable in series.
On March 24, 2011, there were 244,137,897 shares of
common stock outstanding and an additional 6,751,795 issued
shares of common stock which we hold as treasury shares. No
shares of preferred stock were issued or outstanding on
March 24, 2011. The outstanding shares of our common stock
are listed on the New York Stock Exchange. Computershare
Trust Company, N.A. is the transfer agent and registrar for
our common stock.
Common
Stock
Voting
Rights
Each share of our common stock is entitled to one vote per share
on each matter voted upon by shareholders, subject to the right
of shareholders to vote cumulatively in the election of
directors and the rights of the holders of shares of preferred
stock, if any, that may be outstanding.
Except as may otherwise be required by our Amended Articles of
Incorporation, our Code of Regulations or Ohio law in respect of
certain matters, the affirmative vote of at least a majority of
the shares of common stock outstanding on the record date is
required for any proposal to be adopted. Various matters,
including the approval of certain transactions and certain
amendments to the Amended Articles of Incorporation or Code of
Regulations, require the affirmative vote of the holders of
two-thirds of the shares of common stock outstanding.
In voting for the election of directors, each share is entitled
to one vote for each director to be elected unless cumulative
voting is in effect. In an uncontested election for which
cumulative voting is not in effect, all candidates for
directorships to be filled must receive more votes
for their election than against their
election in order to be elected. If the election is contested or
if cumulative voting is in effect, the candidates for
directorships to be filled receiving the most votes shall be
elected, up to the number of directors to be elected. An
election shall be considered contested if there are more
nominees for election than director positions to be filled in
that election. Any holder of shares of common stock may request
that voting for the election of directors be cumulative. In
voting cumulatively, a shareholder may give any one candidate
for director a number of votes equal to the number of directors
to be elected multiplied by the number of shares he or she is
entitled to vote, or may distribute his or her votes on the same
principle among two or more candidates as desired.
Under Ohio law, an incumbent director who is not re-elected will
continue in office as a holdover director until his
or her successor is elected by a subsequent shareholder vote, or
his or her earlier resignation, removal from office or death. In
order to address holdover terms for any incumbent
directors who fail to be re-elected under our majority vote
standard, our corporate governance guidelines provide that if a
director nominee does not receive a majority affirmative vote,
he or she will promptly offer his or her resignation as a
director to the board of directors.
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Dividend
Rights
The holders of shares of our common stock are entitled to
receive dividends and other distributions if, as and when
declared by our board of directors out of funds legally
available for that purpose. These rights are subject to any
preferential rights and any sinking fund, redemption or
repurchase rights of any outstanding shares of preferred stock.
We are not permitted to pay dividends to holders of our common
stock if we have not paid or provided for the dividends, if any,
fixed with respect to any outstanding shares of preferred stock.
The terms of our senior secured credit facilities and certain of
our outstanding debt securities contain covenants that may
restrict our ability to pay cash dividends on our capital stock,
including our common stock, under certain circumstances.
Specifically, under most of our existing financing agreements,
we may pay cash dividends and make other distributions on our
capital stock, including our common stock, only if certain
financial tests are met or certain exceptions are available.
Liability for
Calls and Assessments
The outstanding shares of our common stock are validly issued,
fully paid and non-assessable.
Preemptive
Rights
Holders of shares of our common stock do not have preemptive
rights or conversion rights as to additional issuances of shares
of our common stock or of securities convertible into, or
entitling the holder to purchase, shares of our common stock.
Liquidation
Rights
If the Company were voluntarily or involuntarily liquidated,
dissolved or wound up, the holders of our outstanding shares of
common stock would be entitled to share in the distribution of
all assets remaining after payment of all of our liabilities and
after satisfaction of prior distribution rights and payment of
any distributions owing to holders of any outstanding shares of
preferred stock.
Other
Information
Holders of shares of our common stock have no conversion,
redemption or call rights related to their shares. We may,
pursuant to action authorized by our board of directors, offer
to repurchase or otherwise reacquire shares of our common stock,
but we may not redeem issued and outstanding shares.
Preferred
Stock
Our board of directors is authorized, without further action, to
fix by an amendment to our Amended Articles of Incorporation the
terms and the powers, preferences and rights, and the
qualifications, limitations and restrictions thereof, of our
preferred stock, in one or more series. Our Amended Articles of
Incorporation provide that all series of our preferred stock
rank on parity with one another. If shares of a series of
preferred stock are outstanding and if six quarterly dividends
thereon have not been paid as provided by the terms of that
outstanding series of preferred stock, then the holders of the
preferred stock have the right to elect, as a class, two members
of our board of directors, which rights continue until the
failure to pay such dividends is cured. In addition, the
separate affirmative vote or consent of the holders of any
outstanding preferred stock may be required to authorize the
creation of a class of capital stock that ranks senior or on a
parity with our preferred stock, the increase in the authorized
number of shares of our preferred stock and certain other
corporate actions, including mergers and the sale of all or
substantially all of our property or business.
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Policy Regarding
Shareholder Rights Plans
We do not have a shareholder rights plan. The board of directors
has agreed to the following policy, which is set forth in our
corporate governance guidelines, with respect to the future
adoption of a rights plan:
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if we ever were to adopt a rights plan, the board of directors
would seek prior shareholder approval of the plan unless, due to
timing constraints or other reasons, a committee consisting
solely of independent directors determines that it would be in
the best interests of shareholders to adopt a plan before
obtaining shareholder approval; and
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if a rights plan is adopted without prior shareholder approval,
the plan must either be ratified by shareholders or must expire
within one year.
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Certain
Provisions of Ohio Law and the Companys Amended Articles
of Incorporation and Code of Regulations
There are statutory provisions of Ohio law and provisions in our
Amended Articles of Incorporation and Code of Regulations that
may have the effect of deterring hostile takeovers or delaying
or preventing changes in control or changes in management of the
Company, including transactions in which our shareholders might
otherwise receive a premium over the then current market prices
for their shares.
Amended
Articles of Incorporation and Code of Regulations
Our Amended Articles of Incorporation and Code of Regulations
contain various provisions that may have the effect, either
alone or in combination with each other, of making more
difficult or discouraging a business combination or an attempt
to obtain control of the Company that is not approved by the
board of directors. These provisions include:
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the right of our board of directors to issue authorized and
unissued shares of common stock without shareholder approval;
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the right of our board of directors to issue shares of preferred
stock in one or more series and to designate the number of
shares of those series and certain terms, rights and preferences
of those series, including redemption terms and prices and
conversion rights, without shareholder approval; and
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provisions prohibiting the removal of directors except upon the
vote of holders of shares entitling them to exercise at least
two-thirds of the voting power of the Company.
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Ohio Law
Provisions
Various laws may affect the legal or practical ability of
shareholders to dispose of shares of the Company. Such laws
include the Ohio statutory provisions described below.
Chapter 1704 of the Ohio Revised Code prohibits an
interested shareholder (defined in Section 1704.01 of the
Ohio Revised Code as a beneficial owner, directly or indirectly,
of ten percent or more of the voting power of any issuing public
Ohio corporation) or any affiliate or associate of an interested
shareholder (as defined in Section 1704.01 of the Ohio
Revised Code) from engaging in certain transactions with the
corporation during the three-year period after the interested
shareholders share acquisition date.
The prohibited transactions include, among other things:
mergers, consolidations, majority share acquisitions, certain
purchases, leases and sales of assets, certain issuances or
transfers of shares (or rights to acquire shares), dissolutions,
certain reclassifications, recapitalizations or other
transactions that would increase the proportion of shares held
by the interested shareholder or its affiliates or associates,
and the provision of certain benefits (including loans, advances
and other financial assistance) by the corporation to the
interested shareholder or its affiliates or associates.
S-52
After the expiration of the three-year period, the corporation
may participate in such a transaction with an interested
shareholder only if, among other things:
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the transaction receives the approval of the holders of at least
two-thirds of all the voting shares of the corporation and is
also approved by the holders of at least a majority of the
disinterested voting shares (defined as those shares not held by
the interested shareholder or its affiliates or
associates); or
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the transaction meets certain criteria designed to ensure that
the remaining shareholders receive fair consideration for their
shares.
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The prohibitions do not apply if, before the interested
shareholder becomes an interested shareholder, the board of
directors of the corporation approves either the interested
shareholders acquisition of shares or the otherwise
prohibited transaction. The restrictions also do not apply if a
person was an interested shareholder prior to the adoption of
the statute on April 11, 1990, unless, subject to certain
exceptions, the interested shareholder increases his, her or its
proportionate voting power on or after April 11, 1990 or if
a person inadvertently becomes an interested shareholder,
provided that, as soon as practicable, they divest the
voting shares that resulted in them becoming an interested
shareholder.
Pursuant to Ohio Revised Code Section 1707.043, an Ohio
publicly traded corporation may recover profits made from any
disposition of the corporations equity securities by a
person who, within eighteen months before such disposition made
a proposal, or publicly disclosed the intention or possibility
of making a proposal, to acquire control of the corporation. The
corporation may not, however, recover from a person who proves
in a court of competent jurisdiction either of the following:
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such persons sole purpose in making the proposal or public
disclosure was to succeed in acquiring control of the
corporation and that there were reasonable grounds to believe
that such person would acquire control of the
corporation; or
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such persons public disclosure concerning the intention or
possibility of making a proposal to acquire control of the
corporation were not effected with a purpose of affecting market
trading and thereby increasing any profit or decreasing any loss
from the disposition of the equity securities, and the public
disclosure did not have a material effect on the market price or
trading volume of the corporations equity securities.
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Also, before the corporation may obtain any recovery, the
aggregate amount of the profit realized by such person must
exceed $250,000. Section 1707.043 does not apply to equity
securities acquired more than eighteen months before the date on
which the proposal or public disclosure was made. Any
shareholder may bring an action on behalf of the corporation if
a corporation fails or refuses to bring an action to recover
these profits within sixty days of a written request by a holder
of any equity security. The party bringing such an action may
recover attorneys fees if the court having jurisdiction
over such action orders the recovery of any profits.
We are also subject to Ohios Control Share Acquisition Act
(Ohio Revised Code Section 1701.831). The Control Share
Acquisition Act provides that, with certain exceptions, a person
may acquire beneficial ownership of shares in certain ranges
(one-fifth or more but less than one-third, one-third or more
but less than a majority, or a majority or more) of the voting
power of the outstanding shares of an Ohio corporation meeting
certain criteria, which the Company meets, only if such person
has submitted an acquiring person statement and the
proposed acquisition has been approved at a special meeting of
shareholders called for the purpose of considering the proposed
acquisition by both (i) the vote of a majority of the
voting power of the corporation and (ii) the vote of a
majority of the voting power of the corporation excluding
interested shares (as defined in
Section 1701.01 of the Ohio Revised Code).
S-53
CERTAIN MATERIAL
UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
The following is a summary of certain of the material United
States federal income tax consequences of the acquisition,
ownership and disposition of the mandatory convertible preferred
stock and the common stock received in respect thereof. This
summary only addresses holders who hold shares of the mandatory
convertible preferred stock and common stock as capital assets.
As used herein, U.S. holders are any beneficial
owners of shares of the mandatory convertible preferred stock or
common stock, that are, for United States federal income tax
purposes, (i) citizens or residents of the United States,
(ii) corporations (or other entities treated as
corporations for United States federal income tax purposes)
created or organized in, or under the laws of, the United
States, any state thereof or the District of Columbia,
(iii) estates, the income of which is subject to United
States federal income taxation regardless of its source, or
(iv) trusts if (a) a court within the United States is
able to exercise primary supervision over the administration of
the trust and (b) one or more United States persons have
the authority to control all substantial decisions of the trust.
In addition, certain trusts in existence on August 20, 1996
and treated as U.S. persons prior to such date may also be
treated as U.S. holders. As used herein,
non-U.S. holders
are beneficial owners of shares of the mandatory convertible
preferred stock or common stock, other than partnerships, that
are not U.S. holders. If a partnership (including for this
purpose any entity treated as a partnership for United States
federal income tax purposes) is a beneficial owner of shares of
the mandatory convertible preferred stock or common stock, the
treatment of a partner in the partnership will generally depend
upon the status of the partner and upon the activities of the
partnership. Partnerships and partners in such partnerships
should consult their tax advisors about the United States
federal income tax consequences of acquiring, owning and
disposing of shares of the mandatory convertible preferred stock
or common stock.
This summary does not describe all of the tax consequences that
may be relevant to a holder in light of its particular
circumstances. For example, it does not deal with special
classes of holders such as banks, thrifts, real estate
investment trusts, regulated investment companies, insurance
companies, dealers and traders in securities or currencies, or
tax-exempt investors. It also does not discuss shares of
mandatory convertible preferred stock or common stock held as
part of a hedge, straddle, synthetic security or
other integrated transaction. This summary does not address the
tax consequences to (i) persons that have a functional
currency other than the U.S. dollar, (ii) certain
U.S. expatriates or (iii) persons subject to the
alternative minimum tax. Further, it does not include any
description of any estate or gift tax consequences or the tax
laws of any state or local government or of any foreign
government that may be applicable to the mandatory convertible
preferred stock or common stock.
This summary is based on the Internal Revenue Code of 1986, as
amended (the Code), the Treasury Regulations
promulgated thereunder and administrative and judicial
interpretations thereof, all as of the date hereof, and all of
which are subject to change or differing interpretations,
possibly on a retroactive basis.
You should consult with your own tax advisor regarding the
United States federal, state, local and foreign tax consequences
of the ownership and disposition of shares of the mandatory
convertible preferred stock and the common stock received in
respect thereof.
Taxation of U.S.
Holders
Distributions on Preferred Stock and Common
Stock. Cash distributions paid on the
mandatory convertible preferred stock or common stock will be
treated as a dividend to the extent paid out of Goodyears
current or accumulated earnings and profits (as determined under
United States federal income tax principles) and will be
includible in income by a U.S. holder and taxable as
ordinary income when received. If a cash distribution exceeds
Goodyears current and accumulated earnings and profits,
the excess will be first treated as a tax-free return of capital
up to the U.S. holders tax basis in its shares of
mandatory convertible preferred stock or common stock
S-54
(determined on a share by share basis). Any amount in excess of
the U.S. holders tax basis will be treated as capital
gain.
Non-corporate U.S. holders will be taxed for United States
federal income tax purposes at a maximum rate of 15% on
distributions treated as dividends for taxable years beginning
before January 1, 2013, provided that certain
holding period and other requirements are satisfied.
Distributions treated as dividends received by corporate
U.S. holders will be eligible for the dividends-received
deduction, subject to various limitations (including
restrictions relating to the holders taxable income,
holding period of the mandatory convertible preferred stock or
common stock and debt financing).
A dividend that exceeds certain thresholds in relation to a
U.S. holders tax basis in the mandatory convertible
preferred stock or common stock could be characterized as an
extraordinary dividend (as defined in
Section 1059 of the Code). If a corporate U.S. holder
receives an extraordinary dividend, it will generally be
required to reduce its stock basis in the shares in respect of
which the extraordinary dividend is paid by the portion of such
dividend that is not taxed because of the dividends-received
deduction. If the amount of the basis reduction exceeds the
corporate U.S. holders tax basis in its mandatory
convertible preferred stock or common stock, the excess will be
treated as taxable gain. If a non-corporate U.S. holder
receives an extraordinary dividend, it will be required to treat
any loss on the sale of the shares in respect of which such
extraordinary dividend is paid as a long-term capital loss to
the extent of the extraordinary dividends received that qualify
for the 15% tax rate described above.
U.S. holders should consult their own tax advisors
regarding the availability of the reduced dividend tax rate or
the dividends-received deduction, and the potential application
of the extraordinary dividend rules in light of their particular
circumstances.
Adjustments to the Conversion Rate. The
conversion rate of the convertible preferred stock will be
adjusted in certain circumstances. Adjustments (or failure to
make adjustments) that have the effect of increasing a
U.S. holders proportionate interest in
Goodyears assets or earnings may, in some circumstances,
result in a deemed distribution to the holder. Adjustments to
the conversion rate made pursuant to a bona fide reasonable
adjustment formula that has the effect of preventing the
dilution of the interest of the U.S. holder of the
mandatory convertible preferred stock, however, will generally
not be considered to result in a deemed distribution to the
holder. Certain of the possible conversion rate adjustments
provided in the terms of the mandatory preferred stock
(including adjustments in respect of taxable dividends paid to
holders of common stock) may not qualify as being pursuant to a
bona fide reasonable adjustment formula. If adjustments that do
not qualify as being pursuant to a bona fide reasonable
adjustment formula are made, U.S. holders of mandatory
convertible preferred stock will be deemed to have received a
distribution even though they have not received any cash or
property. Any deemed distribution will be taxable as a dividend,
return of capital, or capital gain as described above under
Distributions on Preferred Stock and Common
Stock.
Conversion into Common Shares. A
U.S. holder generally will not recognize gain or loss upon
the conversion of the mandatory convertible preferred stock into
shares of common stock, except that (1) a
U.S. holders receipt of cash (if any) in respect of
accrued and unpaid dividends or dividends in arrears will be
taxable as described under Distributions on
Preferred Stock and Common Stock above, (2) a
U.S. holders receipt of common stock (if any) in
respect of accrued and unpaid dividends or dividends in arrears
will be taxable as described under
Distributions on Preferred Stock and Common
Stock above as if the U.S. holder had received cash
in respect of such accrued dividends or dividends in arrears and
(3) a U.S. holders receipt of cash in lieu of a
fractional share of common stock will result in capital gain or
loss (measured by the difference between the cash received in
lieu of the fractional share and the holders tax basis in
the fractional share).
Except as discussed in the next sentence, a
U.S. holders basis in shares of common stock received
upon conversion of the mandatory convertible preferred stock
(and any fractional shares
S-55
treated as received and then exchanged for cash) will equal the
basis of the converted shares of mandatory convertible preferred
stock and the holding period of such shares of common stock will
include the holding period of the converted shares of mandatory
convertible preferred stock. Common shares received in payment
of dividends in arrears and taxed as a dividend upon receipt, if
any, will have a basis equal to their fair market value on the
date of conversion, and a new holding period which will commence
on the day after the conversion.
Conversion After Dividend Record
Date. If a U.S. holder exercises its
right to convert shares of the mandatory convertible preferred
stock into common stock after a dividend record date but before
payment of the dividend, then upon conversion the holder will be
required to pay us in cash an amount equal to the portion of
such dividend attributable to the current quarterly dividend
period, which amount would increase the tax basis of the common
shares received. When the dividend is received, the holder would
recognize the dividend payment in accordance with the rules
described under Distributions on Preferred
Stock and Common Stock above.
Sale or Exchange. Upon the sale or
exchange of shares of mandatory convertible preferred stock
(other than a conversion into common stock) or common stock, a
U.S. holder will recognize taxable gain or loss equal to
the difference between the amount realized on the sale or
exchange and the holders adjusted tax basis in the shares
sold or exchanged.
Gain or loss recognized on the sale or exchange of mandatory
convertible preferred stock or common stock will generally be
capital gain or loss and will be long-term capital gain or loss
if, at the time of the sale or exchange, the
U.S. holders holding period in the mandatory
convertible preferred stock or common stock is greater than one
year. If a U.S. holder is a non-corporate holder, long-term
capital gain is subject to preferential tax rates. The
deductibility of capital losses against ordinary income is
subject to limitations.
Additional Shares of Common Stock
Received. Although it is not free from doubt,
any additional shares of common stock received by a
U.S. holder as a result of a fundamental change (see
Description of Mandatory Convertible Preferred
Stock Conversion Upon Fundamental Change) or
the nonpayment of dividends (see Description of Mandatory
Convertible Preferred Stock Mandatory Conversion
Upon Nonpayment of Dividends) should be treated as part of
the consideration received in the conversion. If this treatment
is correct, then the U.S. holder would be treated in the
manner described above under Conversion into
Common Shares. U.S. holders should consult their own
tax advisors to determine the specific tax treatment of such
additional shares in their particular circumstances.
Information Reporting and Backup
Withholding. In general, information
reporting requirements will apply to payments of dividends and
the proceeds of the sale of the mandatory convertible preferred
stock or common stock. Backup withholding may apply to such
payments if the holder fails to comply with certain
identification requirements. Backup withholding is currently
imposed at a rate of 28%. Backup withholding is not an
additional tax. Any amounts withheld under the backup
withholding rules from a payment to a U.S. holder will be
allowed as a credit against such holders United States
federal income tax and may entitle the holder to a refund,
provided that the required information is furnished to
the IRS.
Taxation of
Non-U.S.
Holders
Distributions. Any actual or
constructive distribution of cash or common stock that is
treated as a dividend (including any common stock received on
conversion attributable to accumulated and unpaid dividends or
dividends in arrears (if any)) generally will be subject to
U.S. federal withholding tax at a 30% rate or a reduced
rate specified by an applicable income tax treaty, unless such
dividends are effectively connected with a
non-U.S. holders
conduct of a U.S. trade or business (and the holder
provides an IRS
Form W-8ECI
or other appropriate certification), in which case the
non-U.S. holder
will be taxed in the same manner as a U.S. holder. If such
non-U.S. holder
is a corporation, a 30% branch profits tax (or lower rate
specified by an applicable income tax treaty) may
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apply. In order to obtain a reduced rate of withholding pursuant
to an applicable income tax treaty, a
non-U.S. holder
will be required to provide us with a properly executed IRS
Form W-8BEN
claiming benefits of the applicable treaty. In the case of a
constructive dividend, we will withhold the U.S. federal
income tax on such dividend from any future cash dividends,
shares of common stock, or sales proceeds otherwise payable to
you. A
non-U.S. holder
that is subject to U.S. withholding tax under such
circumstances should consult its own tax advisor as to whether
it can obtain a refund for all or a portion of such withholding
tax.
Conversion of Mandatory Convertible Preferred Stock into
Common Stock. A non-U.S. holder will not
recognize gain or loss in respect of the receipt of shares of
common stock upon the conversion of the mandatory convertible
preferred stock, except that common stock received that is
attributable to accumulated and unpaid dividends or dividends in
arrears, if any, will be treated in the manner described above
under Distributions on Preferred Stock and
Common Stock.
Sale or Exchange. A
non-U.S. holder
generally will not be subject to United States federal income
tax on any gain realized on the sale or exchange of shares of
the mandatory convertible preferred stock (other than a
conversion into common stock) or common stock unless
(i) the gain is effectively connected with a United States
trade or business of the
non-U.S. holder
or (ii) in the case of a
non-U.S. holder
who is an individual, such holder is present in the United
States for a period or periods aggregating 183 days or more
during the taxable year of the disposition and certain other
conditions are met.
Except to the extent that an applicable income tax treaty
otherwise provides, if an individual
non-U.S. holder
falls under clause (i) above, such individual generally
will be taxed on the net gain derived from a sale in the same
manner as a U.S. holder. If an individual
non-U.S. holder
falls under clause (ii) above, such individual generally
will be subject to a 30% tax on the gain derived from a sale,
which may be offset by certain United States-related capital
losses (notwithstanding the fact that such individual is not
considered a resident of the United States). Individual
non-U.S. holders
who have spent (or expect to spend) 183 days or more in the
United States in the taxable year in which they contemplate a
disposition of shares of mandatory convertible preferred stock
or common stock are urged to consult their tax advisors as to
the tax consequences of such sale. If a
non-U.S. holder
that is a foreign corporation falls under clause (i), it
generally will be taxed on the net gain derived from a sale in
the same manner as a U.S. holder and, in addition, may be
subject to the branch profits tax on such effectively connected
income at a 30% rate (or such lower rate as may be specified by
an applicable income tax treaty).
Information Reporting and Backup Withholding
Tax. United States backup withholding tax
will not apply to payments of dividends on the mandatory
convertible preferred stock or common stock to a
non-U.S. holder
if the holder delivers an IRS
W-8BEN or
other appropriate certification of
non-U.S. status,
unless the payor has actual knowledge or reason to know that the
holder is a United States person. Information reporting
requirements may apply with respect to dividend payments on the
mandatory convertible preferred stock or common stock, in which
event the amount of dividends paid and tax withheld (if any)
with respect to each
non-U.S. holder
will be reported annually to the IRS.
Information reporting requirements and backup withholding tax
will not apply to any payment of the proceeds of a sale of
shares of mandatory convertible preferred stock or common stock
effected outside the United States by a foreign office of a
broker as defined in applicable Treasury Regulations
(absent actual knowledge or reason to know that the payee is a
United States person), unless such broker (i) is a United
States person as defined in the Code, (ii) is a foreign
person that derives 50% or more of its gross income for certain
periods from the conduct of a trade or business in the United
States, (iii) is a controlled foreign corporation for
United States federal income tax purposes or (iv) is a
foreign partnership with certain connections to the United
States. Payment of the proceeds of any such sale effected
outside the United States by a foreign office of any broker that
is described in the preceding sentence may be subject to
information reporting unless such broker has documentary
evidence in its
S-57
records that the beneficial owner is a
non-U.S. holder
and certain other conditions are met, or the beneficial owner
otherwise establishes an exemption. Payment of the proceeds of
any such sale to or through the United States office of a broker
is subject to information reporting and backup withholding
requirements unless the beneficial owner satisfies the
requirements described in the preceding paragraph or otherwise
establishes an exemption.
Backup withholding is not an additional tax. Any amounts
withheld from a payment to a
non-U.S. holder
under the backup withholding rules will be allowed as a credit
against the holders United States federal income tax
liability and may entitle the holder to a refund,
provided that the required information is furnished to
the IRS.
Non-U.S. holders
should consult their tax advisors regarding the application of
information reporting and backup withholding in their particular
situations, the availability of an exemption from backup
withholding and the procedure for obtaining such an exemption,
if available.
Recent
Legislation
Recently passed legislation may require a foreign financial
institution through which shares of mandatory preferred stock or
common stock are held to enter into an agreement with the IRS
that would obligate the foreign financial institution to obtain
information about its account holders and to disclose
information about certain U.S. account holders of the
foreign financial institution to the IRS. If the foreign
financial institution through which shares of mandatory
preferred stock or common stock are held does not enter into
such an agreement, was unable to obtain information about its
U.S. account holders or otherwise failed to satisfy its
obligations under the agreement, the legislation would impose,
beginning after December 31, 2012, a 30% withholding tax on
dividends paid on the mandatory convertible preferred stock and
common stock and the proceeds of the sale of shares of such
stock held through such a foreign financial institution.
Recently passed legislation may also require certain
U.S. holders who are individuals, estates or trusts to pay
up to an additional 3.8% tax on, among other things, dividends
and capital gains for taxable years beginning after
December 31, 2012.
The United States federal income tax discussion set forth
above is included for general information only and may not be
applicable depending upon a holders particular situation.
Prospective holders should consult their tax advisors with
respect to the tax consequences to them of the ownership and
disposition of the mandatory convertible preferred stock and
common stock, including the tax consequences under state, local,
foreign and other tax laws and the possible effects of changes
in United States federal income or other tax laws.
S-58
UNDERWRITING
We and the underwriters for this offering named below have
entered into an underwriting agreement with respect to the
shares of mandatory convertible preferred stock being offered.
Subject to certain conditions, each underwriter has severally
agreed to purchase the number of shares of our mandatory
convertible preferred stock indicated in the following table.
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Underwriters
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Number of Shares
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Goldman, Sachs & Co.
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J.P. Morgan Securities LLC
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Citigroup Global Markets Inc.
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Credit Agricole Securities (USA) Inc.
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BNP Paribas Securities Corp.
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HSBC Securities (USA) Inc.
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Natixis Bleichroeder LLC
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Total
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8,700,000
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The underwriters are committed to take and pay for all of the
shares being offered, if any are taken, other than the shares
covered by the option described below unless and until this
option is exercised.
If the underwriters sell more shares of our mandatory
convertible preferred stock than the total number set forth in
the table above, the underwriters have an option to buy up to an
additional 1,300,000 shares of our mandatory convertible
preferred stock from us. They may exercise that option for
30 days from the date of the final prospectus supplement.
If any shares of our mandatory convertible preferred stock are
purchased pursuant to this option, the underwriters will
severally purchase shares in approximately the same proportion
as set forth in the table above.
The following table shows the per share and total underwriting
discounts to be paid to the underwriters by us. Such amounts are
shown assuming both no exercise and full exercise of the
underwriters option to purchase 1,300,000 additional
shares.
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Total Fees
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Without
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With Full
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Fee per share
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Exercise of Option
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Exercise of Option
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Discounts and commissions paid by us
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$
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$
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$
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Shares of our mandatory convertible preferred stock sold by the
underwriters to the public will initially be offered at the
initial price to the public set forth on the cover of this
prospectus supplement. Any shares sold by the underwriters to
securities dealers may be sold at a discount of up to
$ per share from the initial price
to the public. If all the shares are not sold at the initial
price to the public, the representatives may change the offering
price and the other selling terms. The offering of the shares by
the underwriters is subject to receipt and acceptance and
subject to the underwriters right to reject any order in
whole or in part.
We have agreed with the underwriters, subject to certain
exceptions, not to, directly or indirectly, offer, sell, make
any short sale or otherwise dispose of, any shares of our
mandatory convertible preferred stock or common stock, or other
securities that are convertible into or exchangeable or
exercisable for our mandatory convertible preferred stock or
common stock (other than any shares of common stock issued upon
the conversion of the mandatory convertible preferred stock),
during the period from the date of this prospectus supplement
continuing through the date 90 days after the date of the
final prospectus supplement, except with the prior written
consent of Goldman, Sachs & Co. and J.P. Morgan Securities
LLC, as representatives of the underwriters;provided,
however, that we may file a registration statement on
Form S-8 and may issue shares of our common stock and
options
S-59
to purchase shares of our common stock pursuant to any existing
stock option, stock bonus, employment agreement, employee
benefit plan or other stock plan or arrangement.
Certain of our officers have agreed not to, directly or
indirectly, (1) offer, sell, pledge, contract to sell
(including any short sale), grant any option to purchase or
otherwise dispose of any shares of the common stock (including,
without limitation, shares of common stock which may be deemed
to be beneficially owned by the officers subject to
lock-up
restrictions in accordance with the rules and regulations of the
Securities and Exchange Commission, shares of common stock which
may be issued upon exercise of a stock option or warrant and any
other security convertible into or exchangeable for common
stock) or (2) enter into any hedging transaction relating
to our common stock during the
90-day
period following the date of this prospectus supplement without
the prior written consent of Goldman, Sachs & Co. and J.P.
Morgan Securities LLC. Notwithstanding the foregoing, such
officers may (a) transfer shares of the common stock
acquired pursuant to the Companys employee stock purchase
plans in existence on the date of this prospectus supplement,
including, without limitation, any such plan under Section
401(k) of the Internal Revenue Code, (b) transfer shares of
the common stock to the Company for the purpose of exercising
employee stock options pursuant to the share swap exercise
provisions set forth therein, provided that the shares
acquired upon the exercise of such options shall be subject to
the foregoing restrictions, and (c) transfer shares of
common stock or other Company securities if the transfer is by
gift, will or intestacy, provided that the transferee
agrees to be bound by the foregoing restrictions.
In connection with the offering, the underwriters may engage in
transactions that stabilize, maintain or otherwise affect the
price of our mandatory convertible preferred stock, including
purchases and sales of shares of our mandatory convertible
preferred stock or our common stock in the open market. These
transactions in our mandatory convertible preferred stock or our
common stock may include short sales, stabilizing transactions
and purchases to cover positions created by short sales. Short
sales involve the sale by the underwriters of a greater number
of shares than they are required to purchase in the offering.
Covered short sales are sales made in an amount not
greater than the underwriters option to purchase
additional shares from us in the offering. The underwriters may
close out any covered short position by either exercising their
option to purchase additional shares or purchasing shares in the
open market. In determining the source of our mandatory
convertible preferred stock to close out the covered short
position, the underwriters will consider, among other things,
the price of shares available for purchase in the open market as
compared to the price at which they may purchase shares through
the option to purchase additional shares of our mandatory
convertible preferred stock pursuant to the option granted to
them. Naked short sales are any sales in excess of
such option. The underwriters must close out any naked short
position by purchasing our mandatory convertible preferred stock
in the open market. A naked short position is more likely to be
created if the underwriters are concerned that there may be
downward pressure on the price of the shares in the open market
after pricing that could adversely affect investors who purchase
in the offering. Stabilizing transactions consist of various
bids for or purchases of our mandatory convertible preferred
stock or our common stock made by the underwriters in the open
market prior to the completion of the offering.
The underwriters may also impose a penalty bid. This occurs when
a particular underwriter repays to the underwriters a portion of
the underwriting discount received by it because the
representatives have repurchased shares sold by or for the
account of such underwriter in stabilizing or short covering
transactions.
Purchases to cover a short position and stabilizing
transactions, as well as other purchases by the underwriters for
their own accounts, may have the effect of preventing or
retarding a decline in the market price of our mandatory
convertible preferred stock, and together with the imposition of
the penalty bid, may stabilize, maintain or otherwise affect the
market price of our mandatory convertible preferred stock. As a
result, the price of our mandatory convertible preferred stock
may be higher than the price that otherwise might exist in the
open market. If these activities are commenced, they may be
discontinued at any time. These transactions may be effected on
the New York Stock Exchange, in the
over-the-counter
market or otherwise.
S-60
We estimate that our share of the total expenses of this
offering, excluding underwriting discounts, will be
approximately $1 million.
We have agreed to indemnify the several underwriters against
certain liabilities, including liabilities under the Securities
Act.
The underwriters and their respective affiliates are full
service financial institutions engaged in various activities,
which may include securities trading, commercial and investment
banking, financial advisory, investment management, investment
research, principal investment, hedging, financing and brokerage
activities. Certain of the underwriters have performed
commercial and investment banking and advisory services for us
from time to time for which they have received customary fees
and expenses. The underwriters may, from time to time, engage in
transactions with and perform services for us in the ordinary
course of their business. In addition, affiliates of certain of
the underwriters are lenders under our credit facility. In the
ordinary course of their various business activities, the
underwriters and their respective affiliates may make or hold a
broad array of investments and actively trade debt and equity
securities (or related derivative securities) and financial
instruments (including bank loans) for their own account and for
the accounts of their customers and such investment and
securities activities may involve securities or instruments of
the Company. The underwriters and their respective affiliates
may also make investment recommendations or publish or express
independent research views in respect of such securities or
instruments and may at any time hold, or recommend to clients
that they acquire, long or short positions in such securities
and instruments.
Selling
Restrictions
European
Economic Area
In relation to each Member State of the European Economic Area
which has implemented the Prospectus Directive (each, a
Relevant Member State), each underwriter has
represented and agreed that with effect from and including the
date on which the Prospectus Directive is implemented in that
Relevant Member State (the Relevant Implementation
Date) it has not made and will not make an offer of shares
to the public in that Relevant Member State prior to the
publication of a prospectus in relation to the shares which has
been approved by the competent authority in that Relevant Member
State or, where appropriate, approved in another Relevant Member
State and notified to the competent authority in that Relevant
Member State, all in accordance with the Prospectus Directive,
except that it may, with effect from and including the Relevant
Implementation Date, make an offer of shares to the public in
that Relevant Member State at any time:
(a) to legal entities which are authorized or regulated to
operate in the financial markets or, if not so authorized or
regulated, whose corporate purpose is solely to invest in
securities;
(b) to any legal entity which has two or more of
(1) an average of at least 250 employees during the
last financial year; (2) a total balance sheet of more than
43,000,000 and (3) an annual net turnover of more
than 50,000,000, as shown in its last annual or
consolidated accounts;
(c) to fewer than 100 natural or legal persons (other than
qualified investors as defined in the Prospectus Directive)
subject to obtaining the prior consent of the representatives
for any such offer; or
(d) in any other circumstances which do not require the
publication by us of a prospectus pursuant to Article 3 of
the Prospectus Directive.
For the purposes of this provision, the expression an
offer of shares to the public in relation to any
shares in any Relevant Member State means the communication in
any form and by any means of sufficient information on the terms
of the offer and the shares to be offered so as to enable an
investor to decide to purchase or subscribe to the shares, as
the same may be varied in that Relevant Member State by any
measure implementing the Prospectus Directive in that Relevant
Member State
S-61
and the expression Prospectus Directive means Directive
2003/71/EC and includes any relevant implementing measure in
each Relevant Member State.
This document is not a prospectus for the purposes of the
Prospectus Directive.
United
Kingdom
This document is only being distributed to and is only directed
at persons who are (i) outside the United Kingdom,
(ii) investment professionals falling within
Article 19(5) of the Financial Services and Markets Act
2000 (Financial Promotion) Order 2005, as amended (the
Order) or (iii) high net worth entities or
other persons falling within Article 49(2)(a) to
(d) of the Order (all such persons together being referred
to as relevant persons). The securities are only
available to, and any invitation, offer or agreement to
subscribe, purchase or otherwise acquire such securities will be
made to or engaged in only with, relevant persons. Any person
who is not a relevant person should not act or rely on this
document or any of its contents.
Hong
Kong
The shares may not be offered or sold by means of any document
other than (i) in circumstances which do not constitute an
offer to the public within the meaning of the Companies
Ordinance (Cap. 32, Laws of Hong Kong), or (ii) to
professional investors within the meaning of the
Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong)
and any rules made thereunder, or (iii) in other
circumstances which do not result in the document being a
prospectus within the meaning of the Companies
Ordinance (Cap. 32, Laws of Hong Kong), and no advertisement,
invitation or document relating to the shares may be issued or
may be in the possession of any person for the purpose of issue
(in each case whether in Hong Kong or elsewhere), which is
directed at, or the contents of which are likely to be accessed
or read by, the public in Hong Kong (except if permitted to do
so under the laws of Hong Kong) other than with respect to
shares which are or are intended to be disposed of only to
persons outside Hong Kong or only to professional
investors within the meaning of the Securities and Futures
Ordinance (Cap. 571, Laws of Hong Kong) and any rules made
thereunder.
Singapore
Neither this prospectus supplement nor the accompanying
prospectus has been registered as a prospectus with the Monetary
Authority of Singapore. Accordingly, this prospectus supplement,
the accompanying prospectus and any other document or material
in connection with the offer or sale, or invitation for
subscription or purchase, of the shares may not be circulated or
distributed, nor may the shares be offered or sold, or be made
the subject of an invitation for subscription or purchase,
whether directly or indirectly, to persons in Singapore other
than (i) to an institutional investor under
Section 274 of the Securities and Futures Act,
Chapter 289 of Singapore (the SFA),
(ii) to a relevant person, or any person pursuant to
Section 275(1A), and in accordance with the conditions,
specified in Section 275 of the SFA or (iii) otherwise
pursuant to, and in accordance with the conditions of, any other
applicable provision of the SFA.
Where the shares are subscribed or purchased under
Section 275 by a relevant person which is: (a) a
corporation (which is not an accredited investor) the sole
business of which is to hold investments and the entire share
capital of which is owned by one or more individuals, each of
whom is an accredited investor; or (b) a trust (where the
trustee is not an accredited investor) whose sole purpose is to
hold investments and each beneficiary is an accredited investor,
shares, debentures and units of shares and debentures of that
corporation or the beneficiaries rights and interest in
that trust shall not be transferable for 6 months after
that corporation or that trust has acquired the shares under
Section 275 except: (1) to an institutional investor
under Section 274 of the SFA or to a relevant person, or
any person pursuant to Section 275(1A), and in accordance
with the conditions, specified
S-62
in Section 275 of the SFA; (2) where no consideration
is given for the transfer; or (3) by operation of law.
Japan
The shares have not been and will not be registered under the
Financial Instruments and Exchange Law of Japan (the
Financial Instruments and Exchange Law) and each
underwriter has agreed that it will not offer or sell any
securities, directly or indirectly, in Japan or to, or for the
benefit of, any resident of Japan (which term as used herein
means any person resident in Japan, including any corporation or
other entity organized under the laws of Japan), or to others
for re-offering or resale, directly or indirectly, in Japan or
to a resident of Japan, except pursuant to an exemption from the
registration requirements of, and otherwise in compliance with,
the Financial Instruments and Exchange Law and any other
applicable laws, regulations and ministerial guidelines of Japan.
S-63
LEGAL
MATTERS
The validity of our mandatory convertible preferred stock and
certain other legal matters will be passed upon for us by David
L. Bialosky, Senior Vice President, General Counsel and
Secretary of the Company. Mr. Bialosky is paid a salary by
us, is a participant in our Management Incentive Plan, Executive
Performance Plan and equity compensation plans, and owns and has
options to purchase shares of our common stock. Certain legal
matters with respect to the mandatory convertible preferred
stock will be passed upon for us by Covington &
Burling LLP, New York, New York. The underwriters have been
represented by Cravath, Swaine & Moore LLP, New York,
New York.
EXPERTS
The consolidated financial statements as of December 31,
2010 and 2009 and for each of the three years in the period
ended December 31, 2010 and managements assessment of
the effectiveness of internal control over financial reporting
as of December 31, 2010 (which is included in
Managements Report on Internal Control Over Financial
Reporting) incorporated into this prospectus supplement by
reference to the Annual Report on
Form 10-K
for the year ended December 31, 2010, have been so
incorporated in reliance on the report of PricewaterhouseCoopers
LLP, an independent registered public accounting firm, given on
the authority of said firm as experts in accounting and auditing.
S-64
PROSPECTUS
The Goodyear Tire & Rubber
Company
Preferred Stock
Common Stock
We may offer and sell from time to time, in one or more
offerings, preferred stock, common stock or any combination of
these securities at prices and on terms determined at the time
of any such offering. The preferred stock may be convertible
into or exercisable or exchangeable for common stock, preferred
stock or other securities. Our common stock is listed on the New
York Stock Exchange and trades under the symbol GT.
We may offer and sell these securities to or through one or more
underwriters, dealers and agents, or directly to purchasers, on
a continuous or delayed basis.
Each time any of these securities are sold, we will provide one
or more supplements to this prospectus that will contain
additional information about the specific offering and the terms
of the securities being offered. The supplements may also add,
update or change information contained in this prospectus. You
should carefully read this prospectus and any accompanying
prospectus supplement before you invest in any of our securities.
Investing in our securities involves risks. See Risk
Factors on page 5 of this prospectus.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or passed upon the adequacy or accuracy of this
prospectus. Any representation to the contrary is a criminal
offense.
This prospectus may not be used to sell securities unless
accompanied by a prospectus supplement.
This prospectus is dated March 28, 2011
You should rely only on the information contained in or
incorporated by reference into this prospectus, any accompanying
prospectus supplement or any other offering material filed or
provided by us. We have not authorized anyone to provide you
with information that is different. We are not making an offer
to sell these securities in any jurisdiction where the offer or
sale is not permitted. You should not assume that the
information contained in this prospectus, any accompanying
prospectus supplement or any other offering material is accurate
as of any date other than the date on the front of such
document. Any information incorporated by reference into this
prospectus, any accompanying prospectus supplement or any other
offering material is accurate only as of the date of the
document incorporated by reference. Our business, financial
condition, results of operations and prospects may have changed
since that date.
TABLE OF
CONTENTS
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8
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9
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9
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ABOUT
THIS PROSPECTUS
This prospectus is part of a registration statement that we
filed with the Securities and Exchange Commission, or the SEC,
utilizing a shelf registration process, which allows
us to offer and sell, from time to time, our securities in one
or more offerings.
Each time we offer to sell our securities pursuant to this
prospectus, we will provide a prospectus supplement that will
contain more specific information about the offering. The
prospectus supplement may also add, update or change information
contained in this prospectus. In addition, as we describe in the
section entitled Where you can find more
information, we have filed and plan to continue to file
other documents with the SEC that contain information about us
and the business conducted by us. Before you decide whether to
invest in our securities, you should read this prospectus, the
accompanying prospectus supplement and the information that we
file with the SEC.
In this prospectus, Goodyear, we,
our, and us refer to The Goodyear
Tire & Rubber Company and its consolidated
subsidiaries, except as otherwise indicated or as the context
otherwise requires. The phrase this prospectus
refers to this prospectus and any applicable prospectus
supplement, unless the context otherwise requires.
1
WHERE YOU
CAN FIND MORE INFORMATION
We are subject to the information reporting requirements of the
Securities Exchange Act of 1934, as amended, and, accordingly,
we file annual, quarterly and current reports, proxy statements
and other information with the SEC. Our SEC filings are
available at the SECs website
(http://www.sec.gov)
or through our website
(http://www.goodyear.com).
We have not incorporated by reference into this prospectus the
information included on or linked from our website, and you
should not consider it part of this prospectus. You may also
read and copy any document we file with the SEC at its Public
Reference Room at 100 F Street, N.E.,
Washington, D.C. 20549. You may also obtain copies of the
documents at prescribed rates from the Public Reference Room of
the SEC. You may call the SEC at
1-800-SEC-0330
for further information on the operation of the Public Reference
Room. Our SEC filings are also available at the offices of the
New York Stock Exchange, 20 Broad Street, New York, NY
10005.
INCORPORATION
OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to incorporate by reference
documents that we file with the SEC into this prospectus, which
means that we can disclose important information to you by
referring you to those documents. The information incorporated
by reference into this prospectus is considered part of this
prospectus. Any statement in this prospectus or incorporated by
reference into this prospectus shall be automatically modified
or superseded for purposes of this prospectus to the extent that
a statement contained herein or in a subsequently filed document
that is incorporated by reference into this prospectus modifies
or supersedes such prior statement. Any statement so modified or
superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this prospectus.
We incorporate by reference the following documents that have
been filed with the SEC (other than any portion of such filings
that are furnished under applicable SEC rules rather than filed):
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Annual Report on
Form 10-K
for the year ended December 31, 2010;
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Definitive Proxy Statement on Schedule 14A filed on
March 8, 2011;
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Current Report on
Form 8-K
filed on February 22, 2011; and
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Our Registration Statement on Form 10 describing our common
stock and all amendments and reports filed for the purpose of
updating such description, including the Current Report on
Form 8-K
filed on March 28, 2011.
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All documents and reports that we file with the SEC (other than
any portion of such filings that are furnished under applicable
SEC rules rather than filed) under Sections 13(a), 13(c),
14 or 15(d) of the Securities Exchange Act of 1934, as amended,
from the date of this prospectus until the termination of the
offering of all securities under this prospectus shall be deemed
to be incorporated into this prospectus by reference. The
information contained on our website
(http://www.goodyear.com)
is not incorporated into this prospectus.
You may request a copy of any documents incorporated by
reference herein at no cost by writing or telephoning us at:
The Goodyear
Tire & Rubber Company
1144 East Market Street
Akron, Ohio
44316-0001
Attention: Investor Relations
Telephone number:
330-796-3751
Exhibits to the filings will not be sent, however, unless those
exhibits have specifically been incorporated by reference into
this prospectus.
2
FORWARD-LOOKING
INFORMATION SAFE HARBOR STATEMENT
Certain information set forth herein or incorporated by
reference herein may constitute forward-looking statements
regarding events and trends that may affect our future operating
results and financial position. The words estimate,
expect, intend and project,
as well as other words or expressions of similar meaning, are
intended to identify forward-looking statements. You are
cautioned not to place undue reliance on forward-looking
statements, which speak only as of the date of this prospectus
or, in the case of information incorporated by reference herein,
as of the date of the document in which such information
appears. Such statements are based on current expectations and
assumptions, are inherently uncertain, are subject to risks and
should be viewed with caution. Actual results and experience may
differ materially from the forward-looking statements as a
result of many factors, including:
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if we do not achieve projected savings from various cost
reduction initiatives or successfully implement other strategic
initiatives our operating results, financial condition and
liquidity may be materially adversely affected;
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higher raw material and energy costs may materially adversely
affect our operating results and financial condition;
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our pension plans are significantly underfunded and further
increases in the underfunded status of the plans could
significantly increase the amount of our required contributions
and pension expense;
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we face significant global competition, increasingly from lower
cost manufacturers, and our market share could decline;
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deteriorating economic conditions in any of our major markets,
or an inability to access capital markets or third-party
financing when necessary, may materially adversely affect our
operating results, financial condition and liquidity;
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the challenges of the present business environment may cause a
material reduction in our liquidity as a result of an adverse
change in our cash flow from operations;
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work stoppages, financial difficulties or supply disruptions at
our major original equipment customers, dealers or suppliers
could harm our business;
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our capital expenditures may not be adequate to maintain our
competitive position and may not be implemented in a timely or
cost-effective manner;
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if we experience a labor strike, work stoppage or other similar
event our financial position, results of operations and
liquidity could be materially adversely affected;
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our long term ability to meet current obligations and to repay
maturing indebtedness is dependent on our ability to access
capital markets in the future and to improve our operating
results;
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we have a substantial amount of debt, which could restrict our
growth, place us at a competitive disadvantage or otherwise
materially adversely affect our financial health;
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any failure to be in compliance with any material provision or
covenant of our secured credit facilities could have a material
adverse effect on our liquidity and our results of operations;
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our international operations have certain risks that may
materially adversely affect our operating results;
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we have foreign currency translation and transaction risks that
may materially adversely affect our operating results;
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our variable rate indebtedness subjects us to interest rate
risk, which could cause our debt service obligations to increase
significantly;
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we have substantial fixed costs and, as a result, our operating
income fluctuates disproportionately with changes in our net
sales;
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we may incur significant costs in connection with product
liability and other tort claims;
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our reserves for product liability and other tort claims and our
recorded insurance assets are subject to various uncertainties,
the outcome of which may result in our actual costs being
significantly higher than the amounts recorded;
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we may be required to provide letters of credit or post cash
collateral if we are subject to a significant adverse judgment
or if we are unable to obtain surety bonds, which may have a
material adverse effect on our liquidity;
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we are subject to extensive government regulations that may
materially adversely affect our operating results;
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the terms and conditions of our global alliance with Sumitomo
Rubber Industries, Ltd., or SRI, provide for certain exit rights
available to SRI upon the occurrence of certain events, which
could require us to make a substantial payment to acquire
SRIs minority interests in our European and North American
joint ventures following the determination of the fair value of
those interests;
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if we are unable to attract and retain key personnel, our
business could be materially adversely affected; and
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we may be impacted by economic and supply disruptions associated
with events beyond our control, such as war, acts of terror,
political unrest, public health concerns, labor disputes or
natural disasters.
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It is not possible to foresee or identify all such factors. We
will not revise or update any forward-looking statement or
disclose any facts, events or circumstances that occur after the
date hereof that may affect the accuracy of any forward-looking
statement.
4
THE
COMPANY
We are one of the worlds leading manufacturers of tires,
engaging in operations in most regions of the world. For the
year ended December 31, 2010, our net sales were
$18.8 billion and Goodyears net loss was
$216 million. Together with our U.S. and international
subsidiaries and joint ventures, we develop, manufacture, market
and distribute tires for most applications. We also manufacture
and market rubber-related chemicals for various applications. We
are one of the worlds largest operators of commercial
truck service and tire retreading centers. In addition, we
operate approximately 1,500 tire and auto service center outlets
where we offer our products for retail sale and provide
automotive repair and other services. We manufacture our
products in 56 manufacturing facilities in 22 countries,
including the United States, and we have marketing operations in
almost every country around the world. As of December 31,
2010, we employed approximately 72,000 full-time and
temporary associates worldwide.
We are an Ohio corporation, organized in 1898. Our principal
executive offices are located at 1144 East Market Street, Akron,
Ohio
44316-0001.
Our telephone number is
(330) 796-2121.
RISK
FACTORS
Investing in our securities involves risk. You should carefully
consider the specific risks discussed or incorporated by
reference into this prospectus or the applicable prospectus
supplement, together with all the other information contained in
the prospectus supplement or contained in or incorporated by
reference into this prospectus. You should carefully consider,
among other things, the matters discussed under Risk
Factors included in the applicable prospectus supplement,
in our Annual Report on
Form 10-K
for the year ended December 31, 2010 and in other documents
that we subsequently file with the Securities and Exchange
Commission, all of which are incorporated by reference into this
prospectus, and which may be amended, supplemented or superseded
from time to time by other reports we file with the SEC in the
future.
USE OF
PROCEEDS
Unless otherwise indicated in the applicable prospectus
supplement, we expect to use the net proceeds from any sale of
securities offered by this prospectus for general corporate
purposes. General corporate purposes may include:
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repayment or refinancing of a portion of our existing short-term
or long-term debt;
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redemption or repurchases of certain outstanding securities;
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capital expenditures;
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additional working capital;
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loans or advances to affiliates; and
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other general corporate purposes.
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Our management will retain broad discretion in the allocation of
the net proceeds from the sale of our securities.
5
RATIO OF
EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED
DIVIDENDS
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Year Ended December 31,
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2010
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2009
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2008
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2007
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2006
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Ratio of earnings to combined fixed charges and preferred
dividends(1)(2)
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*
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**
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1.33
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x
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1.70
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x
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***
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* |
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Earnings for the year ended December 31, 2010 were
inadequate to cover fixed charges. The coverage deficiency was
$22 million. |
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Earnings for the year ended December 31, 2009 were
inadequate to cover fixed charges. The coverage deficiency was
$372 million. |
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*** |
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Earnings for the year ended December 31, 2006 were
inadequate to cover fixed charges. The coverage deficiency was
$228 million. |
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(1) |
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For purposes of calculating our ratio of earnings to combined
fixed charges and preferred dividends: |
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Earnings consist of pre-tax income (loss) from
continuing operations before adjustment for minority interests
in consolidated subsidiaries or income or loss from equity
investees plus (i) amortization of previously capitalized
interest and (ii) distributed income of equity investees
less (i) capitalized interest and (ii) minority
interest in pre-tax income of consolidated subsidiaries with no
fixed charges.
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Combined fixed charges and preferred dividends
consist of:
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fixed charges, which consist of (i) interest
expense, (ii) capitalized interest, (iii) amortization
of debt discount, premium or expense, (iv) the interest
portion of rental expense (estimated to equal
1/3
of such expense, which is considered a reasonable approximation
of the interest factor) and (v) proportionate share of
fixed charges of investees accounted for by the equity
method; and
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preferred dividends, which consist of the amount of
pre-tax earnings that is required to pay the dividends on
outstanding preferred shares.
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The consolidated ratio of earnings to combined fixed
charges and preferred dividends is determined by adding back
fixed charges, as defined above, to earnings, as defined above,
which is then divided by combined fixed charges and preferred
dividends, as defined above.
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(2) |
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We had no preferred shares outstanding during the periods
reflected in the table and thus paid no preferred dividends. |
6
DESCRIPTION
OF CAPITAL STOCK
A description of any preferred stock and common stock that may
be offered and sold under this prospectus will be set forth in
the applicable prospectus supplement relating to those
securities.
7
PLAN OF
DISTRIBUTION
We may sell our securities offered by this prospectus:
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through agents;
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to or through underwriters;
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through dealers;
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directly by us to other purchasers; or
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through a combination of any such methods of sale.
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Any underwriters or agents will be identified and their
discounts, commissions and other items constituting
underwriters compensation will be described in the
applicable prospectus supplement.
We (directly or through agents) may sell, and the underwriters
may resell, the securities in one or more transactions,
including negotiated transactions, at a fixed public offering
price or prices, which may be changed, at market prices
prevailing at the time of sale, at prices related to prevailing
market prices or at negotiated prices.
In connection with the sale of our securities, the underwriters
or agents may receive compensation from us or from purchasers of
the securities for whom they may act as agents. The underwriters
may sell securities to or through dealers, who may also receive
compensation from purchasers of the securities for whom they may
act as agents. Compensation may be in the form of discounts,
concessions or commissions. Underwriters, dealers and agents
that participate in the distribution of the securities may be
underwriters as defined in the Securities Act of 1933, as
amended (the Securities Act), and any discounts or
commissions received by them from us and any profit on the
resale of the securities by them may be treated as underwriting
discounts and commissions under the Securities Act.
We may indemnify the underwriters and agents against certain
civil liabilities, including liabilities under the Securities
Act, or contribute to payments they may be required to make in
respect of such liabilities.
Underwriters, dealers and agents may engage in transactions
with, or perform services for, us or our affiliates in the
ordinary course of their businesses.
If so indicated in the prospectus supplement relating to a
particular offering of securities, we will authorize
underwriters, dealers or agents to solicit offers by certain
institutions to purchase the securities from us under delayed
delivery contracts providing for payment and delivery at a
future date. These contracts will be subject only to those
conditions set forth in the prospectus supplement, and the
prospectus supplement will set forth the commission payable for
solicitation of these contracts.
8
LEGAL
MATTERS
In connection with particular offerings of securities, and if
stated in the applicable prospectus supplements, the validity of
the securities being offered by this prospectus will be passed
upon for us by David L. Bialosky, Senior Vice President, General
Counsel and Secretary of the Company. Mr. Bialosky is paid
a salary by us, is a participant in our Management Incentive
Plan, Executive Performance Plan and equity compensation plans,
and owns and has options to purchase shares of our common stock.
In connection with particular offerings of securities, and if
stated in the applicable prospectus supplements, certain legal
matters with respect to such offerings will be passed upon for
us by Covington & Burling LLP, New York, New York. Any
underwriter, dealer or agent will be advised about other issues
relating to any offering by its own legal counsel named in the
applicable prospectus supplement.
EXPERTS
The consolidated financial statements as of December 31,
2010 and 2009 and for each of the three years in the period
ended December 31, 2010 and managements assessment of
the effectiveness of internal control over financial reporting
as of December 31, 2010 (which is included in
Managements Report on Internal Control Over Financial
Reporting) incorporated into this prospectus by reference to the
Annual Report on
Form 10-K
for the year ended December 31, 2010, have been so
incorporated in reliance on the report of PricewaterhouseCoopers
LLP, an independent registered public accounting firm, given on
the authority of said firm as experts in accounting and auditing.
9
8,700,000 Shares
The Goodyear Tire &
Rubber Company
%
Mandatory Convertible Preferred Stock
Goldman, Sachs &
Co.
J.P. Morgan
Citi
Credit Agricole CIB
BNP PARIBAS
HSBC
Natixis Bleichroeder
LLC