-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, NSaf2ZooxK0kIQQkXOmnd8jfjqwhUu8k1VKafflPkWDDlZLwkOaZPk2IPvyecAf8 vg/o4nOy6BTejUVjrEPhFg== 0000950112-95-001232.txt : 19950505 0000950112-95-001232.hdr.sgml : 19950505 ACCESSION NUMBER: 0000950112-95-001232 CONFORMED SUBMISSION TYPE: 424B5 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19950504 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: PAINE WEBBER GROUP INC CENTRAL INDEX KEY: 0000075754 STANDARD INDUSTRIAL CLASSIFICATION: SECURITY BROKERS, DEALERS & FLOTATION COMPANIES [6211] IRS NUMBER: 132760086 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 424B5 SEC ACT: 1933 Act SEC FILE NUMBER: 033-51149 FILM NUMBER: 95534383 BUSINESS ADDRESS: STREET 1: 1285 AVE OF THE AMERICAS CITY: NEW YORK STATE: NY ZIP: 10019 BUSINESS PHONE: 2127132000 FORMER COMPANY: FORMER CONFORMED NAME: PAINE WEBBER INC DATE OF NAME CHANGE: 19840523 424B5 1 PAINE WEBBER GROUP INC. PROSPECTUS SUPPLEMENT (TO PROSPECTUS DATED NOVEMBER 29, 1993) $125,000,000 PAINE WEBBER GROUP INC. 8 1/4% NOTES DUE 2002 ------------ Interest on the Notes will accrue from May 1, 1995 and will be payable semi-annually on May 1 and November 1, beginning November 1, 1995. The Notes will mature on May 1, 2002 and are not redeemable prior to maturity. ------------ THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ================================================================================ Price Underwriting Proceeds to Discounts and to Public(1) Commissions Company(1)(2) Per Note............. 100% .55% 99.45% Total................ $125,000,000 $687,500 $124,312,500 ================================================================================ (1) Plus accrued interest from May 1, 1995 to date of delivery. (2) Before deducting expenses payable by Paine Webber Group Inc. (the "Company") estimated to be $90,000. See "Underwriting." ------------ The Notes are offered subject to receipt and acceptance by the Underwriter, to prior sale and to the Underwriter's right to reject any order in whole or in part and to withdraw, cancel or modify the offer without notice. It is expected that delivery of the Notes will be made in New York, New York, on or about May 9, 1995. This Prospectus Supplement and the accompanying Prospectus may be used by the Company, PaineWebber Incorporated ("PaineWebber") or other affiliates of the Company in connection with offers and sales related to secondary market transactions in the Notes at negotiated prices related to prevailing market prices at the time of sale or otherwise. PaineWebber or such other Company affiliates may act as principal or agent in such transactions. ------------------- PAINEWEBBER INCORPORATED ------------------- The date of this Prospectus Supplement is May 2, 1995. IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NOTES OFFERED HEREBY OR OTHER SECURITIES OF PAINE WEBBER GROUP INC. AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED IN ANY OVER-THE-COUNTER MARKET OR OTHERWISE AND, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. THE COMPANY Paine Webber Group Inc. is a holding company which, together with its operating subsidiaries, forms one of the largest full-service securities and commodities firms in the industry. Founded in 1879, the Company employs approximately 16,600 people in 338 offices worldwide after giving effect to the recent acquisition of certain net assets and specific businesses of Kidder, Peabody Group Inc., which was consummated in a series of transactions in late 1994 and early 1995. The Company's principal line of business is to serve the investment and capital needs of individual, corporate, institutional and public agency clients through its broker-dealer subsidiary, PaineWebber, and other specialized subsidiaries. The Company holds memberships in all major securities and commodities exchanges in the United States, and makes a market in many securities traded on Nasdaq National Market or on other over-the-counter markets. Additionally, PaineWebber is a primary dealer in U.S. government securities. The Company is comprised of interrelated business groups, including the Private Client Group, International, Institutional Fixed Income Sales and Trading, Institutional Equity Sales and Trading, Municipal Securities Group, Investment Banking, Asset Management, Real Estate, Research and Transaction Services, which utilize common operational and administrative personnel and facilities. The Private Client Group consists primarily of a domestic branch office system and consumer product groups through which PaineWebber and certain other subsidiaries provide clients with financial services and products, including the purchase and sale of securities, option contracts, commodity and financial futures contracts, direct investments, selected insurance products, fixed income instruments and mutual funds. The Company may act as a principal or agent in providing these services. Fees charged vary according to the size and complexity of a transaction, and the activity level of a client's account. Through the International, Institutional Fixed Income Sales and Trading and Institutional Equity Sales and Trading groups, the Company places securities for, and executes trades on behalf of, institutional clients both domestically and internationally. In addition, the Company takes positions in both listed and unlisted equity and fixed income securities to facilitate client transactions or for the Company's own account. The Municipal Securities Group originates, underwrites, sells and trades taxable and tax-exempt issues for municipal and public agency clients. Through the Investment Banking group, the Company provides financial advice to, and raises capital for, a broad range of domestic and international corporate clients. Investment Banking manages and underwrites public and private offerings, participates as an underwriter in syndicates of public offerings managed by others, and provides advice in connection with mergers and acquisitions, lease financings and debt restructurings. The Asset Management group is comprised of Mitchell Hutchins Asset Management Inc. ("MHAM"), Mitchell Hutchins Institutional Investors Inc. ("MHII") and Mitchell Hutchins Investment Advisory division ("MHIA"). MHAM and MHII provide investment advisory and portfolio management services to pension and endowment funds. MHAM also provides investment advisory and portfolio management services to individuals and mutual funds. MHIA provides portfolio management services to individuals, trusts and institutions. The Real Estate group provides a full range of capital market services to real estate clients, including underwriting of debt and equity securities, principal lending activity, debt restructuring, property sales and bulk sales services, and a broad range of other advisory services. S-2 The Research group provides investment advice to institutional and individual investors, and other business areas of the Company, on approximately 890 companies in 62 industry sectors. The Transaction Services group includes correspondent services, prime brokerage and securities lending businesses, and specialist trading. Through Correspondent Services Corporation, the Company provides execution and clearing services to broker-dealers in the U.S. and overseas. The Company also acts as a specialist responsible for executing transactions and maintaining an orderly market in certain securities. The Company's businesses operate in one of the nation's most highly regulated industries. Violations of applicable regulations can result in the revocation of broker-dealer licenses, the imposition of censures or fines, and the suspension or expulsion of a firm, its officers or employees. The Company's business is regulated by various agencies, including the Securities and Exchange Commission, the New York Stock Exchange Inc., the Commodity Futures Trading Commission and the National Association of Securities Dealers, Inc. The Company's principal executive offices are located at 1285 Avenue of the Americas, New York, New York 10019 (Telephone: (212) 713-2000). For purposes of the foregoing description, all references to the "Company" refer collectively to Paine Webber Group Inc. and its operating subsidiaries, unless the context otherwise requires. RECENT DEVELOPMENTS On April 20, 1995, the Company announced operating results for the quarter ended March 31, 1995. Those results and the results for the comparable quarter of the prior year are as follows: QUARTER ENDED MARCH 31, --------------------------------- 1995 1994 ---------- ---------- (IN THOUSANDS EXCEPT PER SHARE AMOUNTS) (UNAUDITED) Total Revenues............................. $1,233,910 $1,082,448 Net Revenues............................... 725,784 752,077 Earnings Before Income Taxes............... 52,785 92,747 Net Earnings............................... 34,310 55,648 Earnings Per Share: Primary................................ $0.27 $0.71 Fully Diluted.......................... $0.27 $0.70 On April 19, 1995, in an unrelated development, Moody's Investors Service, Inc. announced that it lowered its ratings on the Company's senior debt from A3 to Baa1 and on its subordinated debt from Baa1 to Baa2. Moody's confirmed the Company's Prime-2 commercial paper rating. USE OF PROCEEDS The net proceeds, after payment of underwriting discounts and expenses, from the sale of the Notes offered hereby, estimated to be approximately $124,222,500, will be used by the Company for general corporate purposes. S-3 CAPITALIZATION The following table sets forth the consolidated capitalization of the Company at December 31, 1994 and as adjusted to give effect to (i) the sale of the Notes offered hereby (ii) the issuance of the Company's 8 7/8% Notes due March 15, 2005 on March 20, 1995 and (iii) the retirement at maturity of the Company's 9 5/8% Notes due May 1, 1995.
ACTUAL AS ADJUSTED ---------- ----------- (IN THOUSANDS EXCEPT SHARES) Long-Term Debt*: Medium-Term Subordinated Notes................................... $ 308,150 $ 308,150 Medium-Term Senior Notes......................................... 618,070 618,070 7% Notes Due March 1, 2000....................................... 199,594 199,594 6 1/4% Notes Due June 15, 1998................................... 199,542 199,542 6 1/2% Notes Due November 1, 2005................................ 199,333 199,333 7 5/8% Notes Due February 15, 2014............................... 178,725 178,725 7 3/4% Subordinated Notes Due September 1, 2002.................. 174,324 174,324 9 1/4% Notes Due December 15, 2001............................... 150,000 150,000 9 5/8% Notes Due May 1, 1995..................................... 150,000 -- 8 7/8% Notes Due March 15, 2005.................................. -- 124,491 7 7/8% Notes Due February 15, 2003............................... 99,965 99,965 Convertible Debentures........................................... 18,627 18,627 Zero Coupon Bonds................................................ 19,085 19,085 8 1/4% Notes Due May 1, 2002 offered hereby...................... -- 125,000 Redeemable Preferred Stock......................................... 185,969 185,969 Stockholders' Equity: Convertible Preferred Stock...................................... 100,000 100,000 Common Stock, $1 par value, 200,000,000 shares authorized; issued 100,613,737 shares at December 31, 1994.................. 100,614 100,614 Additional Paid-in Capital....................................... 784,974 784,974 Retained Earnings................................................ 715,052 715,052 Common Stock held in Treasury, at cost: 1,297,081 shares at December 31, 1994.............................................. (21,981) (21,981) Unamortized Cost of Restricted Stock Awards...................... (51,803) (51,803) Foreign Currency Translation Adjustment.......................... 3,643 3,643 ---------- ----------- Total Capitalization............................................... $4,131,883 $ 4,231,374 ---------- ----------- ---------- -----------
- ------------ * In addition to the indebtedness shown in the foregoing table, the Company and its consolidated subsidiaries had outstanding at December 31, 1994, short-term bank loans totalling $972,959, commercial paper totalling $906,650 and medium-term notes with maturities of less than one year totalling $10,000. S-4 RATIO OF EARNINGS TO FIXED CHARGES The following table sets forth the ratio of earnings to fixed charges for the Company for the five-year period ended December 31, 1994. FISCAL YEAR ENDED DECEMBER 31, - ---------------------------------------- 1990 1991 1992 1993 1994 - ---- ---- ---- ---- ---- * 1.2 1.4 1.3 1.0 * For 1990, earnings were inadequate to cover fixed charges and would have had to increase approximately $102,633,000 in order to cover the deficiency. For purposes of computing the ratio of earnings to fixed charges, "earnings" consist of income (loss) before taxes and fixed charges and "fixed charges" consist of interest expense incurred on securities sold under agreements to repurchase, short-term borrowings, long-term borrowings and that portion of rental expense estimated to be representative of the interest factor. DESCRIPTION OF NOTES The Notes are entitled 8 1/4% Notes Due 2002, are unsecured, and will be issued as a series of Senior Securities under an Indenture dated as of March 15, 1988, as amended by a supplemental indenture dated as of September 22, 1989, and by a supplemental indenture dated as of March 22, 1991, between the Company and Chemical Bank, as Trustee (the "Trustee"), which is more fully described in the accompanying Prospectus (as so amended, the "Indenture"). The statements under this caption are brief summaries of certain provisions of the Notes, do not purport to be complete, and are qualified in their entirety by reference to the Notes and the description of the general terms and provisions of the Securities set forth under the caption "Description of Securities" in the accompanying Prospectus. GENERAL The Notes will be limited to $125,000,000 aggregate principal amount, will be issued in fully registered form only in denominations of $1,000 and any integral multiple thereof, and will mature on May 1, 2002. The Notes are not redeemable by the Company prior to maturity. The principal and interest on the Notes will be payable and the Notes may be transferred or exchanged at the principal corporate trust office of the Trustee in the Borough of Manhattan, The City of New York, or at such other places as may be designated pursuant to the Indenture, provided that payment of interest may be made at the option of the Company by check mailed to registered holders. The Notes may be transferred or exchanged, subject to the limitations provided in the Indenture, without the payment of any service charge, other than any tax or other governmental charge payable in connection therewith. INTEREST Interest on the Notes will accrue from May 1, 1995 at the rate of 8 1/4% per annum and will be payable semi-annually on May 1 and November 1 of each year, beginning November 1, 1995, to the persons in whose names the Notes are registered at the close of business on the next preceding April 15 and October 15, and may be paid by checks mailed to such persons. CERTAIN RESTRICTIVE PROVISIONS The provisions set forth under the caption "Description of Securities--Certain Restrictive Provisions" in the accompanying Prospectus will apply to the Notes. DEFEASANCE The Notes will be subject to defeasance as set forth under the caption "Description of Securities-- Defeasance" in the accompanying Prospectus. S-5 INFORMATION CONCERNING THE TRUSTEE Chemical Bank, Trustee under the Indenture, is a depositary for funds and performs other services for, and transacts other banking business with, the Company in the normal course of business. UNDERWRITING Subject to the terms and conditions contained in the Underwriting Agreement, the Company has agreed to sell to PaineWebber, the sole Underwriter, and the Underwriter has agreed to purchase from the Company the entire $125,000,000 aggregate principal amount of the Notes. The Company has been advised by the Underwriter that it proposes initially to offer the Notes to the public at the public offering price set forth on the cover page of this Prospectus Supplement, and to certain dealers at such price less a concession not in excess of 0.35% of the principal amount of the Notes. The Underwriter may allow and such dealers may reallow a concession not in excess of 0.25% of such principal amount. After the initial public offering, the public offering price and such concessions may be changed. The Notes are a new issue of securities with no established trading market. The Company does not intend to apply for listing of the Notes on a national securities exchange, but has been advised by the Underwriter that it presently intends to make a market in the Notes, as permitted by applicable laws and regulations. The Underwriter is not obligated, however, to make a market in the Notes and any such market making may be discontinued at any time at the sole discretion of the Underwriter. No assurance can be given as to whether a trading market for the Notes will develop or as to the liquidity of any such trading market. The Underwriter is a wholly owned subsidiary of the Company. The underwriting of the Notes offered hereby will conform to the requirements set forth in applicable sections of Schedule E of the By-laws of the National Association of Securities Dealers, Inc. The Company has agreed to indemnify the Underwriter against certain liabilities, including liabilities under the Securities Act of 1933, or contribute to payments which the Underwriter may be required to make in respect thereof. EXPERTS The consolidated financial statements of the Company for the year ended December 31, 1994, incorporated by reference in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1994, have been audited by Ernst & Young LLP, independent auditors, as set forth in their report thereon included therein and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon such report given upon the authority of such firm as experts in accounting and auditing. The combined statements of assets acquired and liabilities assumed of the Real Estate, Eurobond, Retail Brokerage and Asset Management businesses (the "Purchased Businesses") of Kidder, Peabody Group Inc. as of December 26, 1994, or prior date of transfer (the Real Estate and Eurobond businesses are combined on their respective closing dates--December 9 and December 16, 1994) and the combined statement of operations of the Purchased Businesses for the years ended December 27, 1993, December 28, 1992 and December 30, 1991, in the Company's Current Report on Form 8-K dated December 27, 1994, as amended by Form 8-K/A dated February 24, 1995, have been audited by KPMG Peat Marwick LLP, independent auditors, as set forth in their report thereon included therein and incorporated herein by reference. Such combined statements are incorporated herein by reference in reliance upon such report given upon the authority of such firm as experts in accounting and auditing. S-6 ================================================================================ NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY PAINE WEBBER GROUP INC. OR THE UNDERWRITER. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION. THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS AT ANY TIME DOES NOT IMPLY THAT THE INFORMATION THEY CONTAIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THEIR RESPECTIVE DATES. ------------------- TABLE OF CONTENTS PAGE ---- Prospectus Supplement The Company......................... S-2 Recent Developments................. S-3 Use of Proceeds..................... S-3 Capitalization...................... S-4 Ratio of Earnings to Fixed Charges........................... S-5 Description of Notes................ S-5 Underwriting........................ S-6 Experts............................. S-6 Prospectus Available Information............... 2 Documents Incorporated by Reference...................... 2 The Company......................... 3 Use of Proceeds..................... 4 Ratio of Earnings to Fixed Charges........................... 4 Description of Securities........... 4 ERISA Matters....................... 16 Plan of Distribution................ 16 Limitations on Issuance of Bearer Securities........................ 17 Legal Matters....................... 18 Experts............................. 18 ================================================================================ [INSERT LOGO] $125,000,000 PAINE WEBBER GROUP INC. 8 1/4% NOTES DUE 2002 ------------------- PROSPECTUS SUPPLEMENT ------------------- PAINEWEBBER INCORPORATED ------------------- May 2, 1995 ================================================================================ -----END PRIVACY-ENHANCED MESSAGE-----