As Filed with the Securities and Exchange Commission on June 4, 2002
Registration No. 333-83776
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Amendment No. 2
to
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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Sara Lee Corporation
(Exact name of registrant as specified in its charter)
Maryland 36-20890
(State or other jurisdiction (I.R.S. Employer Identification Number)
of incorporation or organization)
Three First National Plaza
Chicago, Illinois 60602-4260
(312) 726-2600
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
RODERICK A. PALMORE
Senior Vice President,
General Counsel and Secretary
Sara Lee Corporation
Three First National Plaza
Chicago, Illinois 60602-4260
(312) 726-2600
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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Approximate date of commencement of proposed sale to the public:
From time to time after this Registration Statement becomes effective.
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If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
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The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
Pursuant to Rule 429 under the Securities Act, this Registration Statement
contains a combined prospectus that also relates to $140,000,000 maximum
aggregate offering price of securities previously registered pursuant to Sara
Lee Corporation's registration statement on Form S-3 (File No. 333-96173) and
not issued. The filing fee associated with such securities was previously paid
with that registration statement.
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The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an
offer to sell these securities and it is not soliciting an offer to buy these
securities in any jurisdiction where the offer or sale is not permitted.
Subject to Completion, Dated June 4, 2002
Prospectus
$4,140,000,000
Sara Lee Corporation
Debt Securities, Debt Warrants, Common Stock, Common Stock Warrants,
Preferred Stock, Currency Warrants, Stock Purchase Contracts
and Stock Purchase Units
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Sara Lee Corporation intends to offer at one or more times the following
securities with a total offering price not to exceed $4,140,000,000 (or the
equivalent thereof in foreign currency or currency units):
. debt securities;
. warrants to purchase debt securities (debt warrants);
. shares of our common stock;
. warrants to purchase shares of our common stock (common stock warrants);
. shares of our preferred stock;
. warrants to receive from us the cash value in U.S. dollars of the right
to purchase or sell foreign currency or currency units to be designated
by us at the time of the offering (currency warrants);
. stock purchase contracts; and
. stock purchase units.
All of the securities listed above may be sold separately, together or as
units with other securities offered hereby.
This prospectus contains a general description of securities that we may
offer for sale. We will describe all remaining material terms of these
securities in supplements to this prospectus. In addition, if we offer
securities as units, all material terms of the units will be described in the
applicable prospectus supplement. You should read the prospectus and the
supplements carefully before you invest.
Our common stock is listed on the New York Stock Exchange under the symbol
"SLE."
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This prospectus may be used to offer and sell these securities only if
accompanied by a prospectus supplement.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.
The date of this prospectus is , 2002
TABLE OF CONTENTS
About this Prospectus...................... 1
Where You Can Find More Information........ 1
Forward-Looking Information................ 2
Sara Lee Corporation....................... 3
Use of Proceeds............................ 4
Ratios of Earnings to Fixed Charges........ 4
Unaudited Pro Forma Consolidated Statements
of Income and Earthgrains Preliminary
Opening Balance Sheet.................... 5
Description of Debt Securities............. 11
Description of Debt Warrants............... 17
Description of Common Stock and Preferred
Stock.................................... 18
Description of Common Stock Warrants....... 21
Description of Currency Warrants........... 22
Description of Stock Purchase Contracts and
Stock Purchase Units..................... 23
Plan of Distribution....................... 24
Legal Matters.............................. 25
Experts.................................... 25
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
Securities and Exchange Commission ("SEC") utilizing a "shelf" registration
process. Under this shelf process, we may, from time to time, sell the
securities described in this prospectus in one or more offerings with a total
offering price not to exceed $4,140,000,000. This prospectus provides you with
a general description of the securities. Each time we sell securities, we will
provide a prospectus supplement that will contain information about the
material terms of that offering that are not included in this prospectus. The
prospectus supplement may also add, update or change information in this
prospectus. Please carefully read both this prospectus and any prospectus
supplement together with additional information described under the heading
"Where You Can Find More Information."
We are not making an offer to sell, or soliciting an offer to buy, the
securities in any jurisdiction where the offer or sale is not permitted.
You should not assume that the information in this prospectus or any
prospectus supplement is accurate as of any date other than the date on the
front of each of those documents, respectively.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports and other information with the
SEC. You may read and copy any document we file at the SEC's public reference
room at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330 for further information on the operation of the public reference
room. You may also read and copy those documents at the offices of: The New
York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005; the
Chicago Stock Exchange, Incorporated, 440 South LaSalle Street, Chicago,
Illinois 60605; and The Pacific Exchange, Incorporated, 301 Pine Street, San
Francisco, California 94104. Our SEC filings are also available to the public
over the Internet on the SEC's web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file with
them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and information that we file later
with the SEC will automatically update and supersede this information. We
incorporate by reference the following documents we filed with the SEC (file
number 1-3344) and any future filings that we make with the SEC under Section
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until we or
any underwriters sell all of the securities:
. our Annual Report on Form 10-K for our fiscal year ended June 30, 2001;
. our Quarterly Reports on Form 10-Q for our fiscal quarters ended
September 29, 2001, December 29, 2001 and March 30, 2002;
. our Current Reports on Form 8-K dated August 21, 2001, September 4, 2001,
September 24, 2001 and March 20, 2002;
. our Current Report on Form 8-K/A dated August 8, 2001, as filed with the
SEC on September 4, 2001; and
. the description of our common stock contained in our Registration
Statement on Form 8-A (File No. 1-3344), filed with the SEC on May 11,
1988, as amended, and
1
the description of the related preferred stock purchase rights contained
in our Registration Statement on Form 8-A (File No. 1-3344), filed with
the SEC on May 19, 1998.
You may request a copy of these filings, at no cost, by writing us at the
following address:
Sara Lee Corporation
Three First National Plaza
70 W. Madison Street
Chicago, Illinois 60602
Attn: Investor Relations and Corporate Affairs Dept.
or by calling (800) 654-SARA toll-free from within the U.S. or (201) 433-7522
from outside the U.S.
You should rely only on the information contained or incorporated by
reference in this prospectus and any prospectus supplement. We have not
authorized anyone to provide you with any additional information.
FORWARD-LOOKING INFORMATION
This prospectus and the accompanying prospectus supplement, including the
information we incorporate by reference, contain certain "forward-looking
statements" discussing our expectations regarding future performance. These
forward-looking statements are based on currently available competitive,
financial and economic data and our management's views and assumptions
regarding future events. Such forward-looking statements are inherently
uncertain, and actual results may differ materially from those expressed or
implied herein. Consequently, we wish to caution you not to place undue
reliance on any forward-looking statements. Among the factors that could impact
our ability to achieve our stated goals are the following:
. impacts on reported earnings from fluctuations in foreign currency
exchange rates--particularly the euro--given our significant
concentration of business in Western Europe;
. significant competitive activity, including advertising, promotional and
price competition, and changes in consumer demand for our products;
. adverse economic trends, including reduced consumer spending, relating in
part to incidents of terrorism and the global repercussions from such
incidents;
. our ability to continue to source production and conduct manufacturing
and selling operations in various countries in the world due to changing
political environments and the impacts on the related business
environment;
. our ability to successfully integrate acquisitions, particularly The
Earthgrains Company, into our existing operations and the availability of
new acquisitions, joint ventures and alliance opportunities that build
stockholder value;
. fluctuations in the cost and availability of various raw materials;
. the impact of foot-and-mouth viral disease in parts of Europe on the
consumption of meat products in general and the cost of raw materials not
affected by the disease but used in the production of food products;
. our ability to complete activities anticipated in our business reshaping
programs, and our ability to realize the estimated savings and
productivity improvements associated with these programs;
. credit and other business risks associated with customers operating in a
highly competitive retail environment; and
. inherent risks in the marketplace associated with new product
introductions, including uncertainties about trade and consumer
acceptance.
In addition, our results may also be affected by general factors, such as
economic conditions, political developments, interest and inflation rates,
accounting standards, taxes and laws and regulations in markets where we
compete.
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SARA LEE CORPORATION
We are a global manufacturer and marketer of brand name products for
consumers throughout the world. With headquarters in Chicago, we have
operations in 58 countries and market branded consumer products in over 170
countries.
We organize our business into three major global business segments:
. Sara Lee Food and Beverage;
. Intimates and Underwear; and
. Household Products.
For financial reporting purposes, our businesses are divided into five
industry segments--Sara Lee Meats, Bakery, Beverage, Household Products and
Intimates and Underwear.
Sara Lee Food and Beverage
Food and Beverage's primary focus is packaged meats, bakery products and
coffee and tea beverages. Our Food business consists of packaged meats and
baked goods. We believe that we are one of the world's largest packaged meats
companies. At the end of fiscal 2001, we held the number-two retail position in
the $11 billion U.S. packaged meats industry based on pounds sold, holding a
leading position in the key categories of hot dogs, corn dogs, smoked sausage,
breakfast sausage, cocktail links and breakfast sandwiches. We also have the
largest packaged meats business in Europe and hold a leading position in
Mexico, based on pounds sold. Our bakery business produces a wide variety of
fresh and frozen baked and specialty items, many of which are marketed under
the Sara Lee brand. Our acquisition of The Earthgrains Company in August 2001,
in combination with our existing bakery business, will create a $3.4 billion
bakery business and we believe will provide significant opportunities for
expanding the Sara Lee name into the fresh bakery market, particularly by
utilizing Earthgrains' direct-store delivery system to merchandise Sara Lee
branded products.
Our Beverage business includes retail and foodservice coffee and tea sales
in major markets around the world. Based on sales volume, we hold a leading
position in coffee in Brazil, many European countries and in the U.S.
foodservice market. We hold the number-three position in the U.S. retail coffee
market, and we rank number one or number two in tea in many European countries,
based on sales volume.
Intimates and Underwear
Our Intimates and Underwear business, which is one of the largest apparel
businesses in the world, focuses on basic, branded "innerwear"
products--intimates, underwear and legwear. Based on unit volume sold, we hold
leading share positions in intimate apparel, underwear and legwear in North
America, Europe and several Latin American countries with a portfolio of
well-known brands including Hanes, Hanes Her Way, Playtex, L'eggs, Dim, Bali,
Just My Size, Wonderbra and Lovable.
Household Products
Household Products is our most global line of business, marketing branded
consumer products in over 170 countries. It includes our household and personal
products businesses as well as our Direct Selling division. Based on sales
volume, at the end of fiscal 2001, we held the number-one position in the bath
and shower products category in Europe, and also held leading positions in air
fresheners and insecticides. Additionally, through our global Kiwi brand, we
have a leading position in the shoe care category worldwide. Our Direct Selling
businesses distribute cosmetics, fragrances, jewelry, toiletries, apparel
products and nutritional supplements directly to consumers. We have an
independent sales force of approximately 800,000 people and we are one of the
largest direct selling companies, based on worldwide sales.
Our principal executive offices are located at Three First National Plaza,
Chicago, Illinois 60602-4260, and our telephone number is (312) 726-2600.
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USE OF PROCEEDS
Unless we indicate otherwise in the applicable prospectus supplement, we
will use the net proceeds from the sale of the securities for general corporate
purposes, including the repayment of existing indebtedness, future
acquisitions, capital expenditures and additions to working capital.
RATIOS OF EARNINGS TO FIXED CHARGES
The ratios of our earnings to our fixed charges and the ratios of our
earnings to our fixed charges and preferred stock dividend requirements for
each of the periods indicated are as follows:
Thirty-Nine
Fiscal Year Ended(1) Weeks Ended
-------------------------------- -----------
March 30,
1997 1998(2) 1999(3) 2000 2001(4) 2002(5)
---- ------- ------- ---- ------- -----------
Ratios of Earnings to Fixed Charges... 6.2x (0.7)x 6.3x 6.0x 6.5x 3.9x
Ratios of Earnings to Fixed Charges
and Preferred Stock Dividend
Requirements........................ 5.4x (0.6)x 6.0x 5.6x 6.2x 3.7x
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(1) Our fiscal year ends on the Saturday nearest June 30.
(2) In 1998, we recorded a restructuring provision that reduced income from
continuing operations before income taxes by $2,038 million. An increase in
income from continuing operations of $497 million in 1998 would have
resulted in a ratio of earnings to fixed charges of 1.0x and an increase in
income from continuing operations of $521 million in 1998 would have
resulted in a ratio of earnings to fixed charges and preferred stock
dividend requirements of 1.0x.
(3) Fiscal 1999 was a 53-week year. In 1999, we recorded a gain on the sale of
our tobacco business of $137 million and a product recall charge of $76
million that resulted in an increase in income from continuing operations
before taxes of $61 million.
(4) In 2001, we recorded a pre-tax charge of $554 million in connection with
certain reshaping actions, a pre-tax gain of $105 million in connection
with the IPO of our Coach Inc. subsidiary and a tax-free gain of $862
million in connection with the exchange of our stock for the stock of Coach
Inc., that resulted in an increase in income from continuing operations
before taxes of $413 million.
(5) During the first thirty-nine weeks of fiscal 2002, we recorded a pretax
charge of $183 million in connection with certain reshaping actions.
The computation of the ratios of earnings to fixed charges is based on the
applicable amounts for us and our subsidiaries on a consolidated basis. For
these ratios, earnings include income from continuing operations before income
taxes, fixed charges and amortization of interest capitalized (but not interest
capitalized during the period). Fixed charges include interest expense
(including interest capitalized during the period) plus the portion of rents we
believe to be representative of the interest factor. For the computation of
ratios of earnings to fixed charges and preferred stock dividend requirements,
preferred stock dividends have been increased to an amount representing the
pre-tax earnings that would have been required to cover such dividends.
4
UNAUDITED PRO FORMA CONSOLIDATED STATEMENTS OF INCOME
AND EARTHGRAINS PRELIMINARY OPENING BALANCE SHEET
On August 7, 2001, Sara Lee Corporation acquired The Earthgrains Company
when approximately 93% of the outstanding Earthgrains common shares were
tendered and accepted by Sara Lee. Following the completion of a subsequent
tender offer period, Sara Lee acquired the remaining Earthgrains common shares
for a total purchase price of $1.875 billion. The Earthgrains acquisition
provides growth opportunities for Sara Lee's core bakery business and other
food businesses by leveraging Earthgrains direct-store delivery system by
introducing the Sara Lee brand into the fresh bread and refrigerated dough
business and expanding the direct-store distribution options for other Sara Lee
products. The anticipated synergies of this business combination with the Sara
Lee brand-name were a key factor associated with the determination of the
purchase price and related goodwill. The results of operations for Earthgrains
have been included in the consolidated financial results of Sara Lee since
August 8, 2001.
The following unaudited pro forma consolidated statements of income combine
the results of operations of Sara Lee and Earthgrains for the annual period
ended June 2001 and the thirty-nine weeks ended March 30, 2002.
The unaudited pro forma consolidated statements of income assume that the
acquisition of Earthgrains occurred at the beginning of July 2000, which is the
beginning of fiscal year 2001.
The unaudited pro forma consolidated statements of income are based on
information available at the time these statements were prepared and certain
estimates and assumptions. The following is a summary of the significant
estimates and assumptions used in preparing the unaudited pro forma
consolidated statements of income:
. Immediately prior to the expiration of Sara Lee's tender offer to acquire
Earthgrains common stock, Earthgrains had 46,572,040 issued and
outstanding shares of common stock, including shares of common stock
issued upon exercise of Earthgrains employee stock options. Using the
tender offer price of $40.25 per share, the total purchase price for all
outstanding Earthgrains common stock was $1.875 billion.
. Sara Lee funded the purchase price with the issuance of $1.0 billion
aggregate principal amount of 6.25% fixed rate debt and $.8 billion
aggregate principal amount of short-term floating rate debt. The
short-term floating rate debt had a weighted average interest rate of
6.0% during fiscal year 2001 and 3.6% during the period from July 1, 2001
to August 7, 2001, the period prior to the date Sara Lee acquired
Earthgrains.
. Sara Lee adopted Statement of Financial Accounting Standards ("SFAS") No.
142, "Goodwill and Other Intangible Assets," as of the beginning of
fiscal year 2002. Under the provisions of this statement, intangible
assets with an indefinite life and goodwill are no longer amortized after
the adoption date. Therefore, no amortization of intangible assets with
an indefinite life or goodwill is included in the pro forma results for
fiscal year 2002 periods. The pro forma results for fiscal year 2001
periods include both Sara Lee and Earthgrains historical amortization of
intangible assets with an indefinite life and goodwill. If the
amortization of intangible assets with an indefinite life and goodwill
had been excluded from fiscal year 2001 periods, amortization expense
would have been reduced in fiscal year 2001 by $155 million, of which $25
million related to Earthgrains.
. Approximately $862 million of the Earthgrains purchase price has been
allocated to identified intangibles. These intangible assets consist of
trademarks, owned and licensed brands, customer relationships and
distribution management system software and have a weighted average life
of 31 years. The valuation of the intangible assets is still preliminary.
. The Earthgrains acquisition has been accounted for under the provisions
of SFAS No. 141 using the purchase method of
5
accounting. All of the excess of the purchase price over the net assets
has been allocated to goodwill. The purchase price allocation is
preliminary since the determination of the fair value of the acquired
assets and liabilities and determination of the finite lives of any
intangibles has not been finalized.
Sara Lee believes that the assumptions used herein provide a reasonable
basis for presenting all of the significant effects of the acquisition in the
unaudited pro forma consolidated statements of income. However, the actual
results of the operations, financing costs, final allocation of the purchase
price and other adjustments will differ from the pro forma adjustments.
The following Earthgrains preliminary opening balance sheet as of August 7,
2001 reflects the preliminary allocation of the Earthgrains purchase price as
Sara Lee continues to refine estimates for certain environmental and other
business exit costs.
On September 4, 2001, Sara Lee filed with the SEC in a Current Report on
Form 8-K/A Earthgrains' consolidated financial statements for both fiscal year
2001 and the first quarter ended June 19, 2001. Sara Lee's consolidated
financial statements for fiscal year 2001 were filed with the SEC on September
27, 2001 in its Annual Report on Form 10-K.
The unaudited pro forma consolidated statements of income are included
herein to show how Sara Lee's statements of income might have appeared had the
Earthgrains acquisition occurred in July 2000. You should not rely on this
information as being indicative of the historical results that would have been
achieved by the combined companies had the acquisition and events described in
the notes to the unaudited pro forma consolidated statements of income actually
occurred in July 2000. Furthermore, this information may not necessarily
reflect the results of operations, financial position and cash flows of Sara
Lee in the future.
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SARA LEE CORPORATION
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FISCAL YEAR ENDED JUNE 30, 2001
Sara Lee Earthgrains Pro Forma Pro Forma
Reported Results (1) Reported Results (2) Adjustments as Adjusted
-------------------- -------------------- ----------- -----------
(dollars and shares in millions, except per share amounts)
Net sales............................... $16,632 $2,594 $ -- $19,226
Cost of sales........................... 10,299 1,412 (18) (4) 11,693
Cost of sales--product line exit costs.. 26 -- -- 26
------- ------ ----- -------
Gross profit............................ 6,307 1,182 18 7,507
Selling, general and administrative
expenses.............................. 4,715 1,062 66 (5,6) 5,843
Interest expense........................ 270 78 98 (8,9) 446
Interest income......................... (90) -- (90)
Other income............................ -- (4) (4)
Unusual items
Gain on sale of Coach business....... (967) -- (967)
Business dispositions and other
charges............................ 528 12 540
------- ------ ----- -------
Income from continuing operations before
income taxes.......................... 1,851 34 (146) 1,739
Income taxes............................ 248 18 (59) (10) 207
------- ------ ----- -------
Income from continuing operations....... 1,603 16 (87) 1,532
Preferred stock dividend, net of tax.... 11 -- -- 11
------- ------ ----- -------
Income from continuing operations
available to common stockholders...... $ 1,592 $ 16 $ (87) $ 1,521
======= ====== ===== =======
Income from continuing operations per
share
--Basic................................ $ 1.94 $ 1.86
======= =======
--Diluted.............................. $ 1.87 $ 1.79
======= =======
Basic shares outstanding................ 819 819
======= =======
Diluted shares outstanding.............. 854 1 (11) 855
======= ===== =======
The accompanying Notes to Unaudited Pro Forma Consolidated Statements of
Income are an integral part of these statements.
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SARA LEE CORPORATION
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
THIRTY-NINE WEEKS ENDED MARCH 30, 2002
Sara Lee Earthgrains Pro Forma Pro Forma
Reported Results (3) Results from 7/1/01--8/7/01 Adjustments as Adjusted
-------------------- --------------------------- ----------- -----------
(dollars and shares in millions, except per share amounts)
Net sales............................. $13,133 $282 $ -- $13,415
Cost of sales......................... 8,095 149 (2) (4) 8,242
Cost of sales--product line exit costs (7) -- -- (7)
------- ---- ---- -------
Gross profit.......................... 5,045 133 2 5,180
Selling, general and administrative
expenses............................ 3,938 117 4 (5,6,7) 4,059
Interest expense...................... 224 8 8 (8,9) 240
Interest income....................... (62) -- -- (62)
Unusual Items
Business dispositions and other
charges............................ 190 -- -- 190
------- ---- ---- -------
Income from continuing operations
before income taxes................. 755 8 (10) 753
Income taxes.......................... 96 2 (5) (10) 93
------- ---- ---- -------
Income from continuing operations..... 659 6 (5) 660
Preferred stock dividend, net of tax.. 8 -- -- 8
------- ---- ---- -------
Income from continuing operations
available to common stockholders.... $ 651 $ 6 $ (5) $ 652
======= ==== ==== =======
Income from continuing operations
per share
--Basic.............................. $ 0.83 $ 0.83
======= =======
--Diluted............................ $ 0.80 $ 0.81
======= =======
Basic shares outstanding.............. 784 784
======= =======
Diluted shares outstanding............ 818 818
======= =======
The accompanying Notes to Unaudited Pro Forma Consolidated Statements of
Income are an integral part of these statements.
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NOTES TO UNAUDITED PRO FORMA CONSOLIDATED STATEMENTS OF INCOME
(1) The results for Sara Lee consist of its results of operations for the
fiscal year ended June 30, 2001.
(2) The results of Earthgrains consist of its results of operations for the
annual period ended on June 19, 2001.
(3) The results for Sara Lee consist of Sara Lee's results of operations for
the thirty-nine weeks ended March 30, 2002, including the results of
Earthgrains since August 8, 2001, the acquisition date.
(4) Earthgrains' assets were revalued as part of purchase accounting, resulting
in a fair market decrease in the asset amounts and changes to the
depreciable lives. Cost of sales has been reduced by $18 million in fiscal
year 2001 and $2 million for the period in fiscal year 2002 prior to the
acquisition date, from July 1, 2001 to August 7, 2001, to reflect the
depreciation adjustment.
(5) Includes incremental ongoing pension and postretirement medical expenses of
$28 million in fiscal year 2001 and $2 million for the period in fiscal
year 2002 prior to the acquisition date. The assumptions used in
determining the plan obligations and annual expense of the Earthgrains
retirement benefit plans were conformed to those used by Sara Lee and these
changes will result in higher ongoing annual expenses.
(6) Approximately $862 million of the Earthgrains purchase price has been
allocated to intangible assets. Assuming a weighted average life of 31
years for these assets results in incremental intangible amortization of
approximately $38 million in fiscal year 2001 and $4 million for the period
in fiscal year 2002 prior to the acquisition date.
(7) Since Sara Lee adopted SFAS No. 142, as of the beginning of fiscal year
2002, no goodwill amortization has been recorded in fiscal year 2002.
Selling, general and administrative expenses were reduced by $2 million in
fiscal year 2002 related to the Earthgrains' amortization prior to the
acquisition date.
(8) Sara Lee funded the acquisition price of approximately $1.8 billion with
the issuance of $1.0 billion aggregate principal amount of 6.25% fixed rate
debt and $.8 billion aggregate principal amount of short-term floating rate
debt. The short-term floating rate debt had a weighted average interest
rate during fiscal year 2001 of 6.0% and for the period in fiscal year 2002
prior to the acquisition date of 3.6%. The incremental interest expense
from the acquisition debt was $115 million for fiscal year 2001, and $10
million for the period from July 1, 2001 to August 7, 2001. An increase of
0.125% in the average short-term interest rate would result in a change to
interest expense on the short-term floating rate debt of $1 million on an
annual basis.
(9) Earthgrains' long-term debt was revalued as part of purchase accounting,
resulting in a fair market increase in the long-term debt amounts. Interest
expense has been reduced by $17 million in fiscal year 2001 and $2 million
for the period in fiscal year 2002 prior to the acquisition date to reflect
the amortization of the long-term debt valuation adjustment.
(10) The effect of taxes on the pro forma statement of income adjustments has
been reflected using a marginal incremental tax rate of 40%, representing
the U.S. statutory tax rate of 35% plus a marginal state tax rate of 5%.
(11) All of the outstanding Earthgrains stock options vested when Sara Lee
accepted the tender of approximately 93% of Earthgrains outstanding common
stock. Any Earthgrains stock options that had not been exercised prior to
the completion of the acquisition were converted into Sara Lee stock
options. The additional Sara Lee stock options issued, had they been
outstanding at the end of Sara Lee's fiscal year 2001, would have resulted
in an additional one million common stock equivalents in the diluted
earnings per share computation.
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The following is a summary of the preliminary opening balances of the
Earthgrains balance sheet as of August 7, 2001. These amounts reflect a
preliminary purchase price allocation as Sara Lee continues to refine estimates
for certain environmental and other business exit costs.
Earthgrains Preliminary Opening Balance Sheet
(Amounts in millions)
Assets
------
Cash and marketable securities $ 86
Accounts receivable........... 246
Inventory..................... 74
Other current assets.......... 36
------
Total current assets.......... 442
------
Property, plant and equipment. 856
Other non-current assets...... 110
Identifiable intangibles...... 862
Goodwill...................... 1,693
------
Total Assets.................. $3,963
======
Liabilities and Equity
----------------------
Accounts and notes payable.... $ 406
Accrued liabilities........... 219
------
Total current liabilities..... 625
------
Long-term debt................ 748
Other non-current liabilities. 681
Equity........................ 1,909
------
Total liabilities and equity.. $3,963
======
10
DESCRIPTION OF DEBT SECURITIES
We will issue the debt securities under an Indenture dated as of October 2,
1990 between us and The Bank of New York, as successor to Continental Bank,
N.A., as trustee. We have summarized selected provisions of the indenture
below. This summary is subject to, and qualified by reference to, all of the
provisions of the indenture. If you would like more information on the
provisions of the indenture, you should review the indenture, which we have
incorporated by reference as an exhibit to the registration statement for the
securities of which this prospectus is a part.
In the summary, we have included references to section numbers of the
indenture so that you can easily locate these provisions. Capitalized terms
used in the summary and not otherwise defined have the meanings specified in
the indenture.
General
The debt securities
. will be unsecured;
. will rank equally (pari passu) with all of our existing and future
unsecured and unsubordinated indebtedness; and
. will be effectively junior to our secured indebtedness.
The debt securities will be our obligations exclusively, and not the obligation
of any of our subsidiaries. Our rights and the rights of any holder of debt
securities (or other of our creditors) to participate in the assets of any
subsidiary upon that subsidiary's liquidation or recapitalization will be
subject to the prior claims of the subsidiary's creditors, except to the extent
that we may be a creditor with recognized claims against the subsidiary.
The indenture does not limit the amount of debt securities or other
indebtedness that we may issue. The covenants contained in the indenture would
not necessarily afford the holders of debt securities protection in the event
of a highly leveraged transaction or other transaction involving us that may
adversely affect holders of debt securities.
The indenture permits us to issue debt securities in one or more series.
Each series of debt securities may have different terms. The terms of any
series of debt securities will be set forth in a resolution of our board of
directors or in a supplement to the indenture relating to that series, or
determined in accordance with a board resolution and set forth in an officers'
certificate that we deliver to the trustee. (Section 2.4)
A supplement to this prospectus will describe all material terms relating to
the debt securities being offered that are not described herein. These terms
will include some or all of the following:
. the title of the series of debt securities;
. the total principal amount and authorized denominations;
. the date or dates on which principal is payable;
. the public offering price;
. the interest rate or rates, if any (which may be fixed or floating),
record and interest payment dates and/or the method by which such rate or
rates or dates may be determined;
. the currency or currencies in which payment of the offering price and/or
principal and interest may be made;
. the manner of payment of prinicipal and interest and where the debt
securities may be exchanged or transferred;
. whether (and if so, when and on what terms) the debt securities can be
redeemed by us or the holder;
. under what circumstances, if any, we will pay additional amounts on the
debt securities to non-U.S. holders in respect of taxes;
. whether (and if so, when and on what terms) the debt securities may be
convertible into or exchangeable for other securities;
. whether there will be a sinking fund; and
. any other terms of the series permitted by the indenture. (Section 2.4)
Each series of debt securities will be a new issue with no established
trading market. Unless otherwise described in the applicable prospectus
supplement, we will not list the debt securities on any securities exchange. We
cannot assure you that there will be a liquid trading market for the debt
securities.
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We may purchase debt securities at any price in the open market or
otherwise. Debt securities we purchase may, in our discretion, be held or
resold, canceled or used to satisfy any sinking fund or redemption requirements.
Debt securities bearing no interest or interest at a rate which, at the time
of issuance, is below the prevailing market rate will be sold at a discount
below their stated principal amount. Special U.S. federal income tax
considerations applicable to any of these discounted debt securities (or to
certain other debt securities issued at par which are treated as having been
issued at a discount for U.S. federal income tax purposes) will be described in
a prospectus supplement.
We will also describe in the applicable prospectus supplement any material
U.S. federal income tax considerations applicable to debt securities
denominated in a foreign currency or currency unit or in respect of which we
may pay principal, premium, if any, and interest in a foreign currency or
currency unit.
Conversion Rights
We will describe in the applicable prospectus supplement the particular
terms and conditions, if any, on which debt securities may be convertible into
other securities. These terms will include the conversion price, the conversion
period, provisions as to whether conversion will be at our option or the option
of the holder, events requiring an adjustment of the conversion price and
provisions affecting conversion in the event of the redemption of the debt
securities. If we issue convertible debt securities, we will need to supplement
the indenture to add applicable provisions regarding conversion.
Form and Exchange of Debt Securities
Unless otherwise described in a prospectus supplement, all debt securities
will be fully registered and will be in either book-entry form or in definitive
form.
Debt securities issued in definitive certificated form will be transferable
or exchangeable at the agency maintained for such purpose as we may designate
from time to time. (Section 2.9 and Section 3.2) We may not impose any service
charge, other than any required tax or governmental charge, on the transfer or
exchange of any debt securities. (Section 2.9)
Debt securities issued in book-entry form will be issued in the form of one
or more fully registered global securities. For purposes of this prospectus,
"Global Security" refers to the global security or securities representing the
entire issue of each series of debt securities. Each Global Security will be
deposited with the trustee as custodian for The Depository Trust Company
("DTC") and registered in the name of DTC or its nominee. A Global Security may
be transferred, in whole and not in part, only to DTC or another nominee of DTC
and their successors.
We understand as follows with respect to the rules and operating procedures
of DTC (the rules that apply to DTC are on file with the SEC):
DTC is a limited purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Securities Exchange
Act of 1934. DTC was created to hold securities for its participants
("Participants") and to facilitate the clearance and settlement of securities
transactions, such as transfers and pledges, between Participants through
electronic computerized book-entry changes in the accounts of its Participants,
thereby eliminating the need for physical movement of certificates.
Participants include securities brokers and dealers, banks, trust companies and
clearing corporations and may include certain other organizations. DTC is owned
by a number of Participants and by the New York Stock Exchange, Inc., The
American Stock Exchange LLC and the National Association of Securities Dealers,
Inc. Indirect access to the DTC system also 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").
Persons who are not Participants may beneficially own debt securities held
by DTC only through Participants or Indirect Participants. Beneficial ownership
of debt securities may be reflected:
. for investors who are Participants, in the records of DTC;
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. for investors holding through a Participant, in the records of such
Participant, whose aggregate interests on behalf of all investors holding
through such Participant will be reflected in turn in the records of DTC;
or
. for investors holding through an Indirect Participant, in the records of
such Indirect Participant, whose aggregate interests on behalf of all
investors holding through such Indirect Participant will be reflected in
turn in the records of a Participant.
Accordingly, transfers of beneficial ownership in a Global Security can only be
effected through DTC, a Participant or an Indirect Participant.
Interests in a Global Security will be shown on, and transfers thereof will
be effected only through,
records maintained by DTC and its Participants. Each Global Security will trade
in DTC's same-day funds settlement system until maturity, and secondary market
trading activity for each Global Security will therefore settle in immediately
available funds. The laws of some states require that certain persons take
physical delivery in definitive form of securities. Consequently, the ability
to transfer beneficial interests in a Global Security to such persons may be
limited.
So long as DTC or its nominee is the registered owner of a Global Security,
DTC or its nominee, as the case may be, for all purposes will be considered the
sole holder of the applicable series of debt securities under the indenture.
Except as provided below, owners of beneficial interests in a Global Security
will not be entitled to have debt securities registered in their names, will
not receive or be entitled to receive physical delivery of debt securities in
definitive form and will not be considered the holders thereof under the
indenture. Accordingly, any person owning a beneficial interest in a Global
Security must rely on the procedures of DTC and, if such person is not a
Participant in DTC, on the procedures of the Participant through which such
person, directly or indirectly, owns its interest, to exercise any rights of a
holder of debt securities.
Because DTC can only act on behalf of Participants, who in turn act on
behalf of Indirect Participants and certain banks, the ability of an owner of a
beneficial interest in the debt securities to pledge such debt securities to
persons or entities that do not participate in the DTC system, or otherwise
take actions in respect of such debt securities, may be affected by the lack of
a physical certificate for such debt securities.
Payment of principal of and interest on the debt securities will be made to
DTC's nominee, as the registered owner of each Global Security. Neither we nor
the trustee will have any responsibility or liability for any aspects 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 understand that upon receipt of any payment of principal of or interest
on a Global Security, it is the practice of DTC to credit the Participants'
accounts with payments in amounts proportionate to their respective beneficial
interests in the principal amount of that Global Security as shown on the
records of DTC. Payments by Participants to owners of beneficial interests in a
Global Security held through such Participants will be the responsibility of
such Participants, as is now the case with securities held for the accounts of
customers registered in "street name."
We have been advised that if any series of debt securities are redeemable by
us, and if we redeem less than all of the debt securities of a series, it is
DTC's practice to determine by lot the amount of interest of each participant
in such series of debt securities to be redeemed.
We understand that under existing industry practices, if we request holders
of debt securities to take action, or if an owner of a beneficial interest in a
debt security desires to take any action which a holder is entitled to take
under the indenture, then (1) DTC would authorize the Participants holding the
relevant beneficial interests to take such action, and (2) such Participants
would authorize the beneficial owners owning through such Participants to take
such action or would otherwise act upon the instructions of beneficial owners
owning through them.
Although DTC has agreed to the foregoing procedures in order to facilitate
transfers of debt securities among its Participants, it is under no obligation
to perform or continue to perform such
13
procedures and such procedures may be discontinued at any time. Neither we nor
the trustee will have any responsibility for the performance by DTC or its
Participants or Indirect Participants of their respective obligations under the
rules and procedures governing their operations.
We will issue debt securities of any series then represented by Global
Securities in definitive form in exchange for those Global Securities if:
. an Event of Default (as defined below) has occurred and is continuing and
all principal and accrued interest in respect of the applicable series of
the debt securities shall have become immediately due and payable;
. DTC is at any time unwilling, unable or ineligible to continue as
depositary for any Global Security and a successor depositary is not
appointed by us within 60 days; or
. we determine not to require all of the debt securities of a series to be
represented by a Global Security.
In any such instance, an owner of a beneficial interest in a Global Security
will be entitled to physical delivery of individual certificated debt
securities in definitive form equal in principal amount to such beneficial
interest in such Global Security and to have all such certificated debt
securities registered in its name. Individual certificated debt securities so
issued in definitive form will be issued in denominations of $1,000
and integral multiples thereof and will be issued in registered form only,
without coupons.
Certain Restrictions
The restrictions summarized in this section will apply to debt securities
unless the applicable prospectus supplement indicates otherwise. Certain terms
used in the following description of these restrictions are defined under the
caption "Certain Definitions" at the end of this section. The following
description is not complete. The full text of these restrictions is included in
the indenture.
Restrictions on Secured Debt
The debt securities will not be secured. If we or one of our Domestic
Subsidiaries incur debt secured by an interest in any Principal Domestic
Property or any shares of capital stock or debt of a Domestic Subsidiary and
the total principal amount of our secured debt (with certain exceptions,
including those listed in the next paragraph), together with our Attributable
Debt in respect of sale and leaseback transactions involving Principal Domestic
Properties, would exceed 10% of Consolidated Stockholders' Equity, we are
required to secure the then outstanding debt securities equally and ratably
with (or prior to) our other secured debt.
The indenture permits us and our Domestic Subsidiaries to create certain
liens without securing the debt securities. (Section 3.6) Among the permitted
liens are:
. purchase money mortgages, including conditional sales and other title
retention agreements;
. liens securing certain construction and improvement loans;
. existing liens on newly acquired property, including property acquired
through merger or consolidation;
. liens in connection with U.S. government contracts;
. liens securing indebtedness of a Domestic Subsidiary outstanding at the
time it became a Domestic Subsidiary;
. liens securing indebtedness of a Domestic Subsidiary to us or to another
Domestic Subsidiary; and
. refinancings of certain permitted liens.
Limitations on Sale and Leaseback Transactions
Neither we nor our Domestic Subsidiaries may sell or transfer any Principal
Domestic Property with the intention of entering into a lease of such facility
for a term of more than five years, unless:
. such property has not been in full operation for more than 120 days prior
to such sale or transfer;
. the Attributable Debt in respect of all such sale and leaseback
transactions involving Principal Domestic Properties, together with our
secured debt, does not exceed 10% of Consolidated Stockholders' Equity;
. within 120 days of such sale or transfer, we apply the net proceeds of
the sale to the
14
retirement of our funded debt (defined as indebtedness having a maturity
of, or extendable or renewable for, a period of more than 12 months from
the date of determination) in an amount not less than the greater of such
net proceeds or the fair value of the Principal Domestic Property so
leased; or
. the sale and leaseback transaction is between us and a Domestic
Subsidiary or between any of our Domestic Subsidiaries. (Section 3.7)
Consolidation, Merger or Sale of Assets
We may not consolidate or merge with or into any other corporation, or sell
or transfer all or substantially all of our property and assets to any other
corporation unless the surviving or successor corporation assumes our
obligations under the indenture and is not in default under the indenture
immediately after the consummation of the transaction. (Section 9.1)
If we sell or transfer substantially all of our assets and the purchaser
assumes our obligations under the indenture, we will be discharged from all
obligations under the indenture and the debt securities. (Section 9.2)
Certain Definitions
The following terms (except Principal Domestic Property) are defined in
Section 1.1 of the indenture.
"Attributable Debt" means, at the time of the determination, the present
value (discounted at the "applicable rate" of interest compounded annually) of
the lessee's obligation for rental payments during the remaining term of the
lease (including any period the lease has been, or may, at the option of the
lessor, be extended). The term "applicable rate" means the yield to maturity of
the U. S. Treasury constant maturity which most closely approximates the
weighted average of the remaining terms of all leases, plus 1.5%.
"Consolidated Stockholders' Equity" means the common and preferred
stockholders' equity and minority interests of Sara Lee Corporation and its
consolidated Subsidiaries, as shown on our consolidated balance sheet in our
latest quarterly or annual report to stockholders.
"Domestic Subsidiary" means a Subsidiary of Sara Lee Corporation, other than
a Subsidiary which neither transacts a substantial portion of its business nor
regularly maintains a substantial portion of its fixed assets within the United
States or a Subsidiary which engages primarily in financing our consolidated
operations.
"Principal Domestic Property" means any facility (together with the land on
which it is erected and the fixtures comprising a part thereof) used primarily
for manufacturing, processing or distribution located within the United States,
owned or leased by Sara Lee Corporation or any Subsidiary and having a gross
book value (without deduction of depreciation reserves) which exceeds
$50,000,000, other than any such facility or portion of such facility that, in
the opinion of our board of directors, is not of material importance to the
business conducted by Sara Lee Corporation and its Subsidiaries, as an entirety.
"Subsidiary" means any corporation of which Sara Lee Corporation or one or
more Subsidiaries (individually or collectively) directly or indirectly own a
majority of the outstanding voting stock of said corporation.
Events of Default
"Event of Default" means, with respect to any series of debt securities, any
of the following:
. failure to pay interest or any additional amounts that continues for a
period of 30 days after payment is due;
. failure to make any principal payment when due (except when such failure
results from mistake, oversight or transfer difficulties and does
not continue for more than three business days);
. failure to make any sinking fund payment when due (except when such failure
results from mistake, oversight or transfer difficulties and does
not continue for more than three business days);
. failure to comply with any of our other agreements contained in the
indenture or in the debt securities for 90 days after notice to us of such
failure from the trustee (or to us and the trustee from the holders of at
least 25% in principal amount of the outstanding debt securities affected
by such failure); and
15
. certain events of bankruptcy, insolvency or reorganization of Sara Lee
Corporation. (Section 5.1)
In general, the trustee is required to give notice of a default with respect
to a series of debt securities to the holders of that series within 90 days
after the occurrence of a default. The trustee may withhold notice of any
default (except a default in payment of principal of or interest on any debt
security) if the trustee in good faith determines it is in the interest of the
holders of that series to do so. (Section 5.11)
An Event of Default for a particular series of debt securities does not
necessarily constitute an Event of Default for other series of debt securities.
If there is a continuing Event of Default, then the trustee or the holders
of at least 25% in principal amount of each outstanding series of debt
securities affected by the Event of Default (voting as separate classes) may
require us to repay the principal and accrued interest on the affected series
immediately. Subject to certain conditions, the requirement to pay with respect
to a series of debt securities may be annulled, and past defaults may be waived
(except a continuing default in payment of principal of, or premium, interest
or additional amounts, if any, on debt securities), by the holders of a
majority in principal amount of that series. If an Event of Default applies to
all outstanding debt securities, then the holders of the debt securities will
be treated as a single class without regard to whether there are several
outstanding series. (Section 5.1 and Section 5.10)
Prior to an Event of Default, the trustee is required to perform only the
specific duties stated in the indenture, and after an Event of Default which
has not been cured or waived, the trustee must exercise the same degree of care
as a prudent individual would exercise or use under the circumstances in the
conduct of his or her own affairs. (Section 6.1)
The trustee may refuse to enforce the indenture or the debt securities
unless it first receives satisfactory security or indemnity. Subject to certain
limitations specified in the indenture, the holders of a majority in principal
amount of the debt securities of an affected series will have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the trustee. (Section 5.9)
Satisfaction and Discharge of Indenture
We will be discharged from certain of our obligations relating to the
outstanding debt securities of a series if we deposit with the trustee money or
the equivalent in securities of the government which issued the currency in
which the debt securities are denominated sufficient for payment of all
principal of and interest and additional amounts, if any, on those debt
securities when due. (Section 10.1) In that event, holders of those debt
securities will only be able to look to the trust fund for payment of the
principal of and interest and additional amounts, if any, on their debt
securities until maturity.
Modification of Indenture
Under the indenture, subject to certain exceptions, we may change our rights
and obligations and the rights of the holders of a series of debt securities
with the consent of the holders of at least 50% in aggregate principal amount
of the outstanding debt securities of that series. However, we may not, among
other things, change the terms of payment of principal or interest, reduce any
amount payable upon redemption, reduce the amount of the principal of a
discount security to be paid upon an acceleration of maturity upon an Event of
Default or reduce the percentage required for changes to the indenture without
the consent of the holder of each debt security affected by such change.
(Section 8.2)
In certain circumstances, we may amend the indenture without the consent of
the holders of outstanding debt securities to evidence a merger of Sara Lee
Corporation, the replacement of the trustee or for other specified purposes.
(Section 8.1)
Reports to Trustee
We are required to provide the trustee with an officers' certificate each
fiscal year stating whether, to the knowledge of the certifying officers in the
course of performance of their duties as officers, we are in compliance with
the requirements of the indenture and no default exists, and if a default has
occurred, identifying the nature of the default of which the officers are
aware. (Section 3.5)
Regarding the Trustee
We maintain ordinary banking relationships and credit facilities with a
number of banks, including the trustee, The Bank of New York.
16
DESCRIPTION OF DEBT WARRANTS
We may issue, separately or together with other securities, debt warrants to
purchase debt securities. We will issue the debt warrants under debt warrant
agreements to be entered into between us and a bank or trust company, as debt
warrant agent, as set forth in the applicable prospectus supplement. We have
summarized selected provisions of the form of debt warrant agreement below.
This summary is subject to, and qualified by reference to, all of the
provisions of the debt warrant agreement. If you would like more information on
the provisions of a debt warrant agreement, you should review the form of debt
warrant agreement, including the debt warrant certificate, which we have
incorporated by reference as an exhibit to the registration statement for the
securities of which this prospectus is a part.
General
A supplement to this prospectus will describe all material terms relating to
the debt warrants being offered that are not described herein. These terms will
include some or all of the following:
. the offering price of the debt warrants, if any;
. the title, total principal amount and authorized denominations of the
series of debt securities purchasable upon exercise of the debt
warrants;
. the manner in which debt warrants may be exercised;
. the amount of debt warrants then outstanding;
. the title and terms of any related debt securities with which the debt
warrants are issued and the number of debt warrants issued with each
debt security;
. the date, if any, on or after which the debt warrants may be transferred
separately from the related debt security;
. the principal amount of debt securities purchasable upon exercise of each
debt warrant and the exercise price;
. the date on which the right to exercise the debt warrants commences and the
expiration date;
. whether we will issue the debt warrant certificates in registered or bearer
form; and
. any other terms of the debt warrants.
Debt warrants may be exercisable for debt securities bearing no interest or
interest at a rate which, at the time of issuance, is below the prevailing
market rate. Material U.S. federal income tax considerations applicable to any
of these discounted debt securities will be described in a prospectus
supplement.
Prior to the exercise of their debt warrants, holders of debt warrants will
not have any of the rights of holders of the debt securities purchasable upon
such exercise and will not be entitled to payments of principal of, and premium
and interest, if any, on those debt securities.
Exercise of Debt Warrants
Each debt warrant will entitle its holder to purchase for cash the principal
amount of debt securities at the exercise price set forth in the applicable
prospectus supplement. Commencing on the date the debt warrants become
exercisable, holders may exercise their debt warrants at any time up to the
close of business on the expiration date, after which time any unexercised debt
warrants will become void.
Upon receipt of the exercise price and the debt warrant certificate properly
completed and executed, we will forward to the holder, as soon as practicable,
the debt securities purchased upon such exercise. If less than all the debt
warrants represented by a certificate are exercised, we will issue a new debt
warrant certificate for the remaining amount of debt warrants.
17
DESCRIPTION OF COMMON STOCK AND PREFERRED STOCK
We may issue, separately or together with or upon the conversion of or
exchange for other securities, shares of our common stock and preferred stock.
We have summarized certain rights of holders of our capital stock below. This
summary is subject to, and qualified by reference to, all of the provisions
contained in:
. Maryland General Corporation Law;
. our charter;
. our bylaws;
. the Rights Agreement between us and First Chicago Trust Company of New
York, as rights agent, pursuant to which we may issue shares of our Series
A Junior Participating Preferred Stock upon the occurrence of certain
events; and
. in the case of preferred stock, our Articles Supplementary relating to such
series of prefered stock.
If you would like more information on our common stock and preferred stock,
you should review the documents described above, each of which we have filed or
incorporated by reference as an exhibit to the registration statement for the
securities of which this prospectus is a part.
Our authorized capital stock consists of:
. 1,200,000,000 shares of common stock, of which, as of March 30, 2002,
784,494,778 shares were outstanding; and
. 13,500,000 shares of preferred stock, of which, as of March 30, 2002,
6,000,000 shares were designated as Series A Junior Participating Preferred
Stock, of which no shares were outstanding, 1,500,000 shares were
designated as Convertible Adjustable Preferred Stock, of which no shares
were outstanding, and 3,171,773 shares were designated as Series A ESOP
Convertible Preferred Stock, all of which were outstanding.
Common Stock
General
Holders of our common stock are entitled to receive dividends on their
shares when, as and if authorized by our board of directors out of assets
legally available for distribution, subject to any preferential dividend rights
of any outstanding preferred stock. In the event we liquidate, dissolve or wind
up our affairs, holders of common stock are also entitled to receive ratably
all of our net assets remaining after payment of all debts and other
liabilities, subject to the prior rights of any outstanding preferred stock.
Each share of common stock entitles its holder to one vote in the election
of directors and on any other matter submitted to a vote of stockholders.
Voting rights are not cumulative, with the result that holders of shares of
capital stock representing more than 50% of the voting rights are entitled to
elect all of our directors. Holders of common stock, solely by virtue of their
holdings, do not have preemptive rights to subscribe for or purchase any shares
of our capital stock which we may issue in the future.
All of our outstanding shares of common stock have been fully paid and are
nonassessable. The rights, preferences and privileges of holders of common
stock are subject to, and may be adversely affected by, the rights of holders
of any series of preferred stock which we may designate and issue in the future.
Preferred Stock Purchase Rights
Each outstanding share of common stock has attached to it one-half of a
right entitling its holder to purchase from us one one-hundredth of a share of
Series A Junior Participating Preferred Stock (subject to antidilution
provisions) at a purchase price of $215 for each one one-hundredth of a share
of preferred stock pursuant to the exercise of a right upon the occurrence of
certain triggering events. Until one of those triggering events occurs, or the
rights are earlier redeemed or expired, the rights will not be evidenced by
separate certificates and may be transferred only with the common stock to
which they are attached.
The rights will become exercisable ten days after any person or group
publicly announces it beneficially owns 15% or more of the outstanding shares
of common stock, or ten business days after a person or group announces an
offer to acquire 15%
18
or more of the outstanding shares of common stock, whichever occurs first,
except that the rights will not become exercisable if such announcement relates
to a tender offer or exchange offer for all outstanding shares of our common
stock and a majority of the disinterested members of our board of directors,
after receiving advice from one or more investment banking firms, determines
that the price of the offer is fair to our stockholders and the offer is
otherwise in our best interest and the best interest of our stockholders. In
the event the rights become exercisable, we will distribute separate rights
certificates evidencing the rights to all holders of our common stock issued
prior to the triggering event. Each right will then entitle its holder (except
the acquiring party) to purchase the number of shares of common stock having a
market value of two times the exercise price of the right.
In the event that, following a triggering event, we merge into or
consolidate with, or transfer 50% or more of our consolidated assets or earning
power to, another entity (other than us or our subsidiaries), each right will
then entitle its holder to purchase the number of shares of common stock of the
acquiring entity having a market value of two times the exercise price of the
right.
We may redeem the rights, as a whole, at a price of $.01 per right (subject
to adjustment), at any time until the earlier of 15 days following the date of
the public announcement that the acquiring party acquired 15% or more of the
common stock and the expiration date of the rights, which is May 31, 2008.
For so long as the rights continue to be associated with the common stock,
each new share of common stock we issue will include one-half of a right.
Preferred Stock
General
Our charter authorizes our board of directors to classify and issue from
time to time any unissued shares of preferred stock and to reclassify any
previously classified but unissued shares of any series of preferred stock. The
applicable prospectus supplement will describe all material terms of a
particular series of preferred stock as set forth in the Articles Supplementary
to our charter establishing such series. These terms will include some or all
of the following:
. title and stated value of the series;
. whether and in what circumstances the holder is entitled to receive
dividends and other distributions;
. whether (and if so, when and on what terms) the series can be redeemed by
us or the holder or converted by the holder;
. whether the preferred stock will rank senior or junior to or on a parity
with any other class or series of preferred stock; and
. voting and other rights, if any.
Holders of preferred stock, solely by virtue of their holdings, do not have
preemptive rights to subscribe for or purchase any shares of our capital stock
which we may issue in the future.
Liquidation Preference
Unless otherwise described in the applicable prospectus supplement, in the
event we liquidate, dissolve or wind up our affairs, the holders of any series
of preferred stock will have preference over the holders of common stock and
any other capital stock ranking junior to such series for payment out of our
assets in the amount specified in the applicable Articles Supplementary. A sale
of all or substantially all of our assets or a consolidation or merger with one
or more corporations will not be deemed a liquidation, dissolution or winding
up for this purpose.
Ranking
Unless otherwise described in the applicable prospectus supplement, any
series of preferred stock we issue using this prospectus will rank senior to
the Series A Junior Participating Preferred Stock.
Series A ESOP Convertible Preferred Stock
As of March 30, 2002, all 3,171,773 shares of our Series A ESOP Convertible
Preferred Stock ("ESOP Preferred Stock") were outstanding. The shares are
issued pursuant to our Employee Stock Ownership Plan. Northern Trust Company is
the trustee to the Employee Stock Ownership Plan and the holder of all shares
of the ESOP Preferred Stock, holding the shares for the beneficial owners.
The holder of the shares of ESOP Preferred Stock is entitled to receive,
when, as and if authorized by our board of directors, cash dividends in an
amount equal to $5.438 per share per annum (subject to adjustment in certain
circumstances), payable semi-annually in arrears. Dividends accrue on a
cumulative basis. The ESOP Preferred Stock is senior to our common stock in
respect of dividend
19
rights with the result that we cannot declare, pay or set aside for payment any
dividends on our common stock unless we have paid or declared and set aside for
payment full cumulative dividends on the shares of ESOP Preferred Stock.
Each share of ESOP Preferred Stock is entitled to vote on all matters
submitted to a vote of our stockholders, voting together with the holders of
our common stock as one class. As of March 30, 2002, each share of ESOP
Preferred Stock was entitled to 10.264 votes. The voting power of the ESOP
Preferred Stock is subject to andidilution adjustments in certain
circumstances. Except as otherwise required by law and with one other
exception, the shares of ESOP Preferred Stock have no special voting rights.
In the event we liquidate, dissolve or wind up our affairs, the holder of
the ESOP Preferred Stock is entitled to receive, after satisfaction of the
claims of our creditors and subject to the rights of holders of any class or
series of stock ranking senior to or on a parity with the ESOP Preferred Stock,
a distribution of $72.50 per share, plus an amount equal to all accrued and
unpaid dividends. The sale, lease, exchange or other transfer of all or any
portion of our assets or a consolidation or merger with one or more
corporations will not be deemed a liquidation, dissolution or winding up for
this purpose.
We may redeem, in whole or in part, shares of ESOP Preferred Stock at any
time in cash, shares of our common stock or both at a price of $72.50 per
share, plus an amount equal to all accrued and unpaid dividends. The holder may
also require us to redeem the ESOP Preferred Stock in certain circumstances,
including if necessary to provide for distributions required under the plan.
Each share of ESOP Preferred Stock is convertible, at the option of the
holder at any time prior to the redemption of the shares, into shares of our
common stock. At March 30, 2002, the conversion price was $9.0625 and each
share of ESOP Preferred Stock was convertible into eight shares of common
stock. The conversion price is subject to antidilution adjustments in certain
circumstances.
The ESOP Preferred Stock ranks senior to the Series A Junior Participating
Preferred Stock and our common stock. Unless otherwise described in the
applicable prospectus supplement, any series of preferred stock we issue using
this prospectus will rank senior to the ESOP Preferred Stock.
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DESCRIPTION OF COMMON STOCK WARRANTS
We may issue, separately or together with other securities, common stock
warrants to purchase shares of our common stock. We will issue the common stock
warrants under stock warrant agreements to be entered into between us and a
bank or trust company, as stock warrant agent, as set forth in the applicable
prospectus supplement. We have summarized selected provisions of the form of
stock warrant agreement below. This summary is subject to, and qualfied by
reference to, all the provisions of the stock warrant agreement. If you would
like more information on the provisions of a stock warrant agreement, you
should review the form of stock warrant agreement, including the stock warrant
certificate, which we have incorporated by reference as an exhibit to the
registration statement for the securities of which this prospectus is a part.
General
A supplement to this prospectus will describe all material terms relating to
the common stock warrants being offered that are not described herein. These
terms will include some or all of the following:
. the offering price of the common stock warrants, if any;
. the manner in which common stock warrants may be exercised;
. the amount of common stock warrants then outstanding;
. the number of shares of common stock purchasable upon exercise of each
common stock warrant and the exercise price;
. the date on which the right to exercise the common stock warrants commences
and the expiration date;
. whether (and if so, when and on what terms) we can call the common stock
warrants for redemption; and
. any other terms of the common stock warrants.
The shares of common stock issuable upon exercise of a common stock warrant,
when issued in accordance with a stock warrant agreement, will be validly
issued, fully paid and nonassessable.
Prior to the exercise of their common stock warrants, holders will not have
any of the rights of holders of the common stock purchasable upon such exercise
and will not be entitled to dividend payments on those shares of common stock.
Exercise of Stock Warrants
Each common stock warrant will entitle its holder to purchase for cash the
number of shares of common stock at the exercise price set forth in the
applicable prospectus supplement. Commencing on the date the common stock
warrants become exercisable, holders may exercise their common stock warrants
at any time up to the close of business on the expiration date, after which
time any unexercised common stock warrants will become void.
Upon receipt of the exercise price and the stock warrant certificate
properly completed and executed, we will forward to the holder, as soon as
practicable, a certificate representing the number of shares of common stock
purchased upon such exercise. If less than all the common stock warrants
represented by a certificate are exercised, we will issue a new stock warrant
certificate for the remaining amount of common stock warrants.
Antidilution Provisions
Unless otherwise described in the applicable prospectus supplement, the
exercise price payable and number of shares of common stock purchasable upon
exercise of a common stock warrant will be adjusted to prevent the holder's
beneficial interest in the common stock from being diluted in the event we:
. issue a stock dividend to all holders of common stock or combine, subdivide
or reclassify our common stock;
. issue rights, warrants or options to all holders of common stock entitling
them to purchase shares of our common stock at a price per share less than
the current market price per share of common stock; or
. distribute to all holders of common stock any of our assets or evidences of
our indebtedness which are not payable out of our capital surplus.
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DESCRIPTION OF CURRENCY WARRANTS
We may issue, separately or together with debt securities or debt warrants,
currency warrants entitling the holder to receive from us the cash value in
U.S. dollars of the right to purchase (currency call warrants) or sell
(currency put warrants) a specified amount of a designated foreign currency. We
will issue the currency warrants under currency warrant agreements to be
entered into between us and a bank or trust company, as currency warrant agent,
as set forth in the applicable prospectus supplement. We have summarized
selected provisions of the form of currency warrant agreement below. This
summary is subject to, and qualified by reference to, all of the provisions of
the currency warrant agreement. If you would like more information on the
provisions of a currency warrant agreement, you should review the form of
currency warrant agreement, including the global warrant certificates, which we
have incorporated by reference as an exhibit to the registration statement for
the securities of which this prospectus is a part.
General
A supplement to this prospectus will describe all material terms relating to
the currency warrants being offered that are not described herein. These terms
will include some or all of the following:
. whether the currency warrants will be currency put warrants or currency
call warrants, or both;
. the formula for determining the cash value in U.S. dollars, if any, of each
currency warrant;
. the manner in which currency warrants may be exercised and the
circumstances, if any, in which such exercise will be deemed automatic;
. the amount of currency warrants then outstanding;
. the minimum number, if any, of currency warrants which must be exercised at
any one time;
. the date on which the right to exercise the currency warrants commences and
the expiration date; and
. any other terms of the currency warrants.
The spot exchange rate of the designated foreign currency, upon exercise, as
compared to the U.S. dollar, will determine whether the currency warrants have
a cash value (cash settlement value) on any given day prior to their expiration.
Form of Currency Warrants
Unless otherwise described in a prospectus supplement, all currency warrants
will be issued in the form of one or more fully registered global certificates
that will be deposited with DTC or its nominee. This means that we will not
issue certificates to each holder. Each global certificate will be issued to
DTC, which will keep a computerized record of its Participants (for example,
your broker) whose clients have purchased currency warrants. The Participant
will then keep a record of its clients who purchased the currency warrants.
Accordingly, transfers of ownership of any currency warrant may only be
effected through a selling holder's broker. For more information on the
procedures of DTC, see "Description of Debt Securities--Form and Exchange of
Debt Securities" above.
Exercise of Currency Warrants
Each currency warrant will entitle its holder to receive the cash settlement
value on the applicable exercise date. Holders may exercise their currency
warrants at any time up to 3:00 p.m., New York City time, on the fifth business
day preceding the expiration date, after which time all currency warrants will
be deemed automatically exercised on the expiration date.
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DESCRIPTION OF THE STOCK PURCHASE CONTRACTS AND THE STOCK PURCHASE UNITS
We may issue stock purchase contracts, representing contracts obligating
holders to purchase from us, and obligating us to sell to the holders, a
specified number (or range of numbers) of shares of our common stock at a
future date or dates. The price per share and number of shares of common stock
may be fixed at the time the stock purchase contracts are issued or may be
determined by reference to a specific formula set forth in the stock purchase
contracts.
The stock purchase contracts may be issued separately or as part of units,
often known as stock purchase units, consisting of a stock purchase contract
and a beneficial interest in either:
. our senior debt securities;
. our preferred stock; or
. debt obligations of third parties, including U.S. Treasury securities,
securing the holder's obligations to purchase common stock under the stock
purchase contracts.
The stock purchase contracts may require us to make periodic payments to the
holders of the stock purchase units or vice versa, and such payments may be
unsecured or prefunded on some basis, to be specified in the applicable
prospectus supplement. The stock purchase contracts may require holders to
secure their obligations in a specified manner, and, in certain circumstances
we may deliver newly issued prepaid stock purchase contracts, often known as
prepaid securities, upon release to a holder of any collateral securing such
holder's obligations under the original stock purchase contract.
The applicable prospectus supplement will describe all material terms
relating to the stock purchase contracts or stock purchase units, the
collateral or depositary arrangements relating to the stock purchase units, if
any, and, if applicable, the prepaid securities.
Material U.S. federal income tax considerations applicable to the stock
purchase units and stock purchase contracts will be discussed in the applicable
prospectus supplement.
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PLAN OF DISTRIBUTION
We may sell securities to underwriters or dealers, through agents or
directly to purchasers (or a combination of these methods). Under certain
circumstances, we may also repurchase securities (directly or through dealers)
and reoffer them to the public in the same manner.
With respect to any offered securities, the terms of any offering, including
the name or names of any underwriters, dealers or agents, the purchase price of
those securities and the proceeds to us from the sale, any underwriting
discounts, selling commissions and other items constituting underwriters',
dealers' or agents' compensation, any initial public offering price and any
discounts or concessions allowed or reallowed or paid to dealers or agents, any
auction or bidding process and any securities exchanges on which the offered
securities may be listed, will be set forth in, or may be calculated from the
information set forth in, the related prospectus supplement. Any initial public
offering price and any discounts or concessions allowed or re-allowed or paid
to dealers may be changed from time to time.
If underwriters are used in the sale of any offered securities, the
securities will be acquired by the underwriters for their own account. The
underwriters may resell the offered securities in one or more transactions,
including negotiated transactions, at a fixed public offering price, which may
be changed, or at varying prices determined at the time of sale. Unless
otherwise set forth in the applicable prospectus supplement, the obligations of
the underwriters to purchase the offered securities will be subject to certain
conditions and the underwriters will be obligated to purchase all of the
securities offered by the prospectus supplement if any of those securities are
purchased.
We may designate from time to time dealers, acting as our agents, to offer
and sell securities upon certain terms and conditions. Unless otherwise
indicated in the applicable prospectus supplement, any agent we designate will
act on a best efforts basis for the period of its appointment.
We may also sell securities directly to the public, without the use of
underwriters, dealers or agents.
The securities may also be offered and sold, if so indicated in the
applicable prospectus supplement, in connection with a remarketing. Any
remarketing would occur upon the securities purchase, in accordance with a
redemption or repayment pursuant to their terms or otherwise, by one or more
remarketing firms, acting as principals for their own account or as our agents.
The applicable prospectus supplement will identify any remarketing firm and
will describe the terms of its agreement, if any, with us.
If so indicated in a prospectus supplement, we will authorize agents,
underwriters or dealers to solicit offers by certain specified institutions to
purchase securities from us at the public offering price set forth in that
prospectus supplement pursuant to delayed delivery contracts providing for
payment and delivery on a future date specified in the prospectus supplement.
Those contracts will be subject to conditions set forth in the prospectus
supplement, and the prospectus supplement will set forth the commissions
payable for solicitation of those contracts.
Underwriters, dealers and agents that participate in the distribution of the
securities may be, or may be deemed to be, underwriters as defined in the
Securities Act of 1933, and any discounts or commissions received by them from
us and any profit on the resale of the offered securities by them may be
treated as underwriting discounts and commissions under the Securities Act. Any
underwriters, dealers or agents will be identified and their compensation from
us will be described in a supplement to this prospectus.
We may have agreements with the underwriters, dealers and agents to
indemnify them against certain civil liabilities, including liabilities under
the Securities Act, or to contribute with respect to payments which the
underwriters, dealers or agents may be required to make.
Underwriters, dealers and agents and/or their respective affiliates may
engage in transactions with, or perform services for, us or our subsidiaries in
the ordinary course of their businesses.
24
LEGAL MATTERS
The validity of the offered securities will be passed upon for us by R.
Henry Kleeman, Esq., our Vice President, Deputy General Counsel and Assistant
Secretary, by Ballard Spahr Andrews & Ingersoll, LLP, Baltimore, Maryland, and
by Sidley Austin Brown & Wood, LLP, New York, New York and/or Sidley Austin
Brown & Wood, Chicago, Illinois, which are affiliated partnerships. Mr. Kleeman
owns shares of our common stock, both directly and as a participant in various
stock and employee benefit plans.
EXPERTS
Our consolidated financial statements and schedules included in the Annual
Report on Form 10-K for the fiscal year ended June 30, 2001 and the Current
Report on Form 8-K dated September 4, 2001 and incorporated by reference in
this prospectus have been audited by Arthur Andersen LLP, independent public
accountants, as indicated in their reports with respect thereto, and are
incorporated by reference herein in reliance upon the authority of said firm as
experts in accounting and auditing in giving said reports.
The audited historical financial statements of The Earthgrains Company
incorporated in this prospectus by reference to our Current Report on Form
8-K/A dated August 8, 2001, as filed with the SEC on September 4, 2001, have
been so incorporated in reliance on the report of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.
25
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The expenses in connection with the issuance and distribution of the
securities, other than underwriting discounts and agency fees or commissions,
are set forth in the following table. All amounts except the Securities and
Exchange Commission registration fee are estimated.
Securities and Exchange Commission registration fee $368,000
Printing and engraving expenses.................... 60,000
Accountants' fees and expenses..................... 60,000
Legal fees and expenses............................ 100,000
Fees and expenses of trustee....................... 20,000
Rating agency fees................................. 200,000
Blue Sky fees and expenses......................... 10,000
Miscellaneous...................................... 10,000
--------
Total........................................... $828,000
========
Item 15. Indemnification of Directors and Officers.
Section 2-405.2 of the Maryland General Corporation Law permits a Maryland
corporation to include in its charter a provision limiting the liability of its
directors and officers to the corporation and its stockholders for money
damages except for liability resulting from (1) actual receipt of an improper
benefit or profit in money, property or services or (2) active and deliberate
dishonesty established by a final judgment or other adjudication as material to
the cause of action adjudicated in the proceeding. Our charter contains a
provision that eliminates directors' and officers' liability to the maximum
extent permitted by Maryland law.
Section 2-418(d) of the Maryland General Corporation Law requires a
corporation (unless its charter provides otherwise, which our charter does not)
to indemnify a director or officer of the corporation who has been successful,
on the merits or otherwise, in the defense of any proceeding to which such
director or officer was made a party by reason of the director's or officer's
service in that capacity. Section 2-418(b) permits a corporation to indemnify
its present or former directors against judgments, penalties, fines,
settlements and reasonable expenses actually incurred by the director in
connection with any proceeding to which the director is made a party by reason
of the director's service as a director unless it is established that (1) the
act or omission of the director was material to the matter giving rise to the
proceeding and was committed in bad faith or was the result of active and
deliberate dishonesty, (2) the director actually received an improper personal
benefit in money, property or services or (3) in the case of a criminal
proceeding, the director had reasonable cause to believe that the act or
omission was unlawful. If, however, the proceeding was one by or in the right
of the corporation and the director was adjudged liable to the corporation, the
corporation may not indemnify the director. Maryland law also permits a
Maryland corporation to pay a director's expenses in advance of the final
disposition of an action to which the director is a party upon receipt by the
corporation of (1) a written affirmation by the director of the director's good
faith belief that the director has met the standard of conduct necessary for
indemnification and (2) a written undertaking by or on behalf of the director
to repay the amount advanced if it is ultimately determined the director did
not meet the necessary standard of conduct. Section 2-418 defines a director as
any person who is or was a director of a corporation and any person who, while
a director of the corporation, is or was serving at the request of the
corporation as a director, officer, partner, trustee, employee or agent of
another foreign or domestic corporation, partnership, joint venture, trust or
other enterprise or employee benefit plan. Section 2-418(j)(2) also permits a
Maryland corporation to indemnify and advance expenses to its officers,
employees and agents to the extent it may indemnify and advance expenses to its
directors.
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Our bylaws obligate us, to the maximum extent permitted by Maryland law, to
indemnify any of our present or former directors or officers or those of our
subsidiaries who, (1) is made a party to a proceeding by reason of such
person's service in that capacity or (2) while a director or officer and at our
request, serves or served another corporation, partnership, joint venture,
trust, employee benefit plan or any other enterprise as a director, officer,
partner or trustee from and against any claim or liability to which that person
may become subject or which that person may incur by reason of such person's
services in such capacity and to pay or reimburse that person's reasonable
expenses in advance of final disposition of a proceeding. This indemnity could
apply to liabilities under the Securities Act of 1933 in certain circumstances.
Our bylaws also permit us to, with the approval of our board of directors,
indemnify and advance expenses to (1) a person who served a predecessor of our
corporation in any of the capacities described above or (2) any of our
employees or agents or any employee or agent of a predecessor.
We also maintain indemnity insurance as is permitted by Section 2-418
pursuant to which officers and directors are indemnified or insured against
liability or loss under certain circumstances, which may include liability or
related losses under the Securities Act of 1933 or the Securities Exchange Act
of 1934.
The forms of Underwriting Agreement and Distribution Agreement filed
herewith as exhibits to this registration statement will provide for
indemnification of our directors and officers against certain liabilities,
including liabilities under the Securities Act of 1933, in certain
circumstances.
Item 16. Exhibits.
Exhibits marked with an asterisk (*) were previously filed.
Exhibit
No. Description Incorporated By Reference To
--- ----------- ----------------------------
1.1* Form of Underwriting Agreement.
1.2* Form of Distribution Agreement.
2.1 Agreement and Plan of Merger, dated as of June 29, 2001 Exhibit 2.1 to the Registrant's Current
by and among the Registrant, SLC Acquisition Corp. and Report on Form 8-K dated August 21,
The Earthgrains Company. 2001.
4.1 Articles of Restatement of Charter, dated April 9, 1990. Exhibit 4.1 to the Registrant's
Registration Statement on Form S-8,
Registration No. 33-35760, filed with
the SEC on July 6, 1990.
4.2 Articles Supplementary to the Charter, dated May 18, 1990. Exhibit 4.2 to the Registrant's
Registration Statement on Form S-8,
Registration No. 33-37575, filed with
the SEC on November 1, 1990.
4.3 Articles of Amendment to the Charter, dated October 30, Exhibit 3(a) to the Registrant's Annual
1992. Report on Form 10-K for the fiscal
year ended July 2, 1994.
4.4 Articles of Amendment to the Charter, dated November 19, Exhibit 3(a)(2) to the Registrant's
1998. Annual Report on Form 10-K for the
fiscal year ended July 3, 1999.
4.5 Articles Supplementary to the Charter, dated January 7, Exhibit 3(a)(3) to the Registrant's
1999. Annual Report on Form 10-K for the
fiscal year ended July 3, 1999.
4.6 Articles Supplementary to the Charter, dated April 28, Exhibit 4.1 to the Registrant's
2000. Quarterly Report on Form 10-Q for the
fiscal quarter ended December 29,
2001.
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Exhibit
No. Description Incorporated By Reference To
--- ----------- ----------------------------
4.7 Amended Bylaws, dated April 27, 2000. Exhibit 3(b) to the Registrant's Annual
Report on Form 10-K for the fiscal
year ended July 1, 2000.
4.8 Rights Agreement, dated as of March 26, 1998, between the Exhibit 4.1 to the Registrant's Report
Registrant and First Chicago Trust Company of New York, on Form 8-K dated May 15, 1998,
as rights agent. filed with the SEC on May 19, 1998.
4.9.1 Indenture, dated as of October 2, 1990, between the Exhibit 4.1 to Amendment No. 1 to the
Registrant and The Bank of New York, as successor to Registrant's Registration Statement on
Continental Bank, N.A., as trustee. Form S-3/A, Registration No. 33-
33603, filed with the SEC on October
5, 1990.
4.9.2 Form of Note (Fixed Rate). Exhibit 4.8.2 to the Registrant's
Registration Statement on Form S-3,
Registration No. 333-96173, filed with
the SEC on February 4, 2000.
4.9.3 Form of Note (Floating Rate). Exhibit 4.2 to the Registrant's Current
Report on Form 8-K dated April 13,
1993.
4.10 Form of Debt Warrant Agreement. Exhibit 4.9 to the Registrant's
Registration Statement on Form S-3,
Registration No. 333-96173, filed with
the SEC on February 4, 2000.
4.11 Form of Stock Warrant Agreement. Exhibit 4.10 to the Registrant's
Registration Statement on Form S-3,
Registration No. 333-96173, filed with
the SEC on February 4, 2000.
4.12 Form of Currency Warrant Agreement. Exhibit 4.11 to the Registrant's
Registration Statement on Form S-3,
Registration No. 333-96173, filed with
the SEC on February 4, 2000.
5.1* Opinion of Sidley Austin Brown & Wood.
5.2 Opinion of Ballard Spahr Andrews & Ingersoll, LLP.
12.1* Computation of ratios of earnings to fixed charges for each
of the last five fiscal years.
12.2 Computation of ratio of earnings to fixed charges for the Exhibit 12.1 to the Registrant's
thirty-nine weeks ended March 30, 2002. Quarterly Report on Form 10-Q for the
fiscal quarter ended March 30, 2002.
12.3* Computation of ratios of earnings to fixed charges and
preferred stock dividend requirements for each of the last
five fiscal years.
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Exhibit
No. Description Incorporated By Reference To
--- ----------- ----------------------------
12.4 Computation of ratio of earnings to fixed charges and Exhibit 12.2 to the Registrant's
preferred stock dividend requirements for the thirty-nine Quarterly Report on Form 10-Q for the
weeks ended March 30, 2002. fiscal quarter ended March 30, 2002.
23.1* Consent of Sidley Austin Brown & Wood (included in
Exhibit 5.1).
23.2 Consent of Ballard Spahr Andrews & Ingersoll, LLP
(included in Exhibit 5.2).
23.3* Consent of Arthur Andersen LLP.
23.4* Consent of PricewaterhouseCoopers LLP.
24.1*. Powers of Attorney.
25.1*. Form T-1--Statement of Eligibility of Trustee.
Item 17. Undertakings.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective Registration Statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
Registration Statement is on Form S-3, Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the Registrant pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the Registration
Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
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(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the Registrant's annual report pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual report pursuant
to Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the Registration Statement shall be deemed to
be a new Registration Statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions referred to in the foregoing provisions,
or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer
or controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Sara Lee
Corporation certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the city of Chicago, State of Illinois, on this 3rd day of
June, 2002.
SARA LEE CORPORATION
/S/ RODERICK A. PALMORE
By: _______________________________
Roderick A. Palmore
Senior Vice President, General
Counsel and Secretary
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on June 3, 2002.
Signature Capacity
--------- --------
/S/ C. STEVEN MCMILLAN Chairman of the Board,
----------------------------- President, Chief Executive
C. Steven McMillan Officer and Director
(Principal Executive
Officer)
/S/ CARY D. MCMILLAN Executive Vice President and
----------------------------- Director
Cary D. McMillan
/S/ FRANK L. MEYSMAN Executive Vice President and
----------------------------- Director
Frank L. Meysman
/S/ L.M. DE KOOL Executive Vice President and
----------------------------- Chief Financial Officer
L.M. de Kool (Principal Financial
Officer)
/S/ WAYNE R. SZYPULSKI Senior Vice
----------------------------- President--Controller and
Wayne R. Szypulski Chief Accounting Officer
(Principal Accounting
Officer)
* Director
-----------------------------
Paul A. Allaire
* Director
-----------------------------
John H. Bryan
* Director
-----------------------------
Charles W. Coker
* Director
-----------------------------
James S. Crown
* Director
-----------------------------
Willie D. Davis
II-6
* Director
-----------------------------
Vernon E. Jordan, Jr.
* Director
-----------------------------
James L. Ketelsen
----------------------------- Director
Hans B. van Liemt
* Director
-----------------------------
Joan D. Manley
* Director
-----------------------------
Rozanne L. Ridgway
* Director
-----------------------------
Richard L. Thomas
--------
* By Roderick A. Palmore as Attorney-in-Fact pursuant to Powers of Attorney
executed by the directors listed above, which Powers of Attorney have been
filed with the Securities and Exchange Commission.
/S/ RODERICK A. PALMORE
By: _______________________________
Roderick A. Palmore
As Attorney-in-Fact
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EXHIBIT INDEX
Exhibit
No. Description Incorporated By Reference To
--- ----------- ----------------------------
1.1* Form of Underwriting Agreement.
1.2* Form of Distribution Agreement.
2.1 Agreement and Plan of Merger, dated as of June 29, 2001 Exhibit 2.1 to the Registrant's Current
by and among the Registrant, SLC Acquisition Corp. and Report on Form 8-K dated August 21,
The Earthgrains Company. 2001.
4.1 Articles of Restatement of Charter, dated April 9, 1990. Exhibit 4.1 to the Registrant's
Registration Statement on Form S-8,
Registration No. 33-35760, filed with
the SEC on July 6, 1990.
4.2 Articles Supplementary to the Charter, dated May 18, 1990. Exhibit 4.2 to the Registrant's
Registration Statement on Form S-8,
Registration No. 33-37575, filed with
the SEC on November 1, 1990.
4.3 Articles of Amendment to the Charter, dated October 30, Exhibit 3(a) to the Registrant's Annual
1992. Report on Form 10-K for the fiscal
year ended July 2, 1994.
4.4 Articles of Amendment to the Charter, dated November 19, Exhibit 3(a)(2) to the Registrant's
1998. Annual Report on Form 10-K for the
fiscal year ended July 3, 1999.
4.5 Articles Supplementary to the Charter, dated January 7, Exhibit 3(a)(3) to the Registrant's
1999. Annual Report on Form 10-K for the
fiscal year ended July 3, 1999.
4.6 Articles Supplementary to the Charter, dated April 28, Exhibit 4.1 to the Registrant's
2000. Quarterly Report on Form 10-Q for the
fiscal Quarter ended December 29,
2001.
4.7 Amended Bylaws, dated April 27, 2000. Exhibit 3(b) to the Registrant's Annual
Report on Form 10-K for the fiscal
year ended July 1, 2000.
4.8 Rights Agreement, dated as of March 26, 1998, between the Exhibit 4.1 to the Registrant's Report
Registrant and First Chicago Trust Company of New York, on Form 8-K dated May 15, 1998,
as rights agent. filed with the SEC on May 19, 1998.
4.9.1 Indenture, dated as of October 2, 1990, between the Exhibit 4.1 to Amendment No. 1 to the
Registrant and The Bank of New York, as successor to Registrant's Registration Statement on
Continental Bank, N.A., as trustee. Form S-3/A, Registration No. 33-
33603, filed with the SEC on October
5, 1990.
4.9.2 Form of Note (Fixed Rate). Exhibit 4.8.2 to the Registrant's
Registration Statement on Form S-3,
Registration No. 333-96173, filed with
the SEC on February 4, 2000.
4.9.3 Form of Note (Floating Rate). Exhibit 4.2 to the Registrant's Current
Report on Form 8-K dated April 13,
1993.
II-8
Exhibit
No. Description Incorporated By Reference To
--- ----------- ----------------------------
4.10 Form of Debt Warrant Agreement. Exhibit 4.9 to the Registrant's
Registration Statement on Form S-3,
Registration No. 333-96173, filed with
the SEC on February 4, 2000.
4.11 Form of Stock Warrant Agreement. Exhibit 4.10 to the Registrant's
Registration Statement on Form S-3,
Registration No. 333-96173, filed with
the SEC on February 4, 2000.
4.12 Form of Currency Warrant Agreement. Exhibit 4.11 to the Registrant's
Registration Statement on Form S-3,
Registration No. 333-96173, filed with
the SEC on February 4, 2000.
5.1* Opinion of Sidley Austin Brown & Wood.
5.2 Opinion of Ballard Spahr Andrews & Ingersoll, LLP.
12.1* Computation of ratios of earnings to fixed charges for each
of the last five fiscal years.
12.2 Computation of ratios of earnings to fixed charges for the Exhibit 12.1 to the Registrant's
thirty-nine weeks ended March 30, 2002. Quarterly Report on Form 10-Q for the
fiscal quarter ended March 30, 2002.
12.3* Computation of ratios of earnings to fixed charges and
preferred stock dividend requirements for each of the last
five fiscal years.
12.4 Computation of ratios of earnings to fixed charges and Exhibit 12.2 to the Registrant's
preferred stock dividend requirements for the thirty-nine Quarterly Report on Form 10-Q for the
weeks ended March 30, 2002. fiscal quarter ended March 30, 2002.
23.1* Consent of Sidley Austin Brown & Wood (included in
Exhibit 5.1).
23.2 Consent of Ballard Spahr Andrews & Ingersoll, LLP
(included in Exhibit 5.2).
23.3* Consent of Arthur Andersen LLP.
23.4* Consent of PricewaterhouseCoopers LLP.
24.1* Powers of Attorney.
25.1* Form T-1--Statement of Eligibility of Trustee.
--------
*Previously filed.
II-9