-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CNY1/MSoYswuQWFCF/+iNu2W6GRZh1xK+rWvQwu1CYRnvC9O/f/yd7vYF0a6NGrM ObYKUqdHk5ABf03J1FHX4A== 0000950130-95-002702.txt : 19951218 0000950130-95-002702.hdr.sgml : 19951218 ACCESSION NUMBER: 0000950130-95-002702 CONFORMED SUBMISSION TYPE: S-3/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 19951215 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: MBIA INC CENTRAL INDEX KEY: 0000814585 STANDARD INDUSTRIAL CLASSIFICATION: SURETY INSURANCE [6351] IRS NUMBER: 061185706 STATE OF INCORPORATION: CT FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3/A SEC ACT: 1933 Act SEC FILE NUMBER: 033-64861 FILM NUMBER: 95602102 BUSINESS ADDRESS: STREET 1: 113 KING ST CITY: ARMONK STATE: NY ZIP: 10504 BUSINESS PHONE: 9142734545 MAIL ADDRESS: STREET 1: 113 KING ST CITY: ARMONK STATE: NY ZIP: 10504 S-3/A 1 AMENDMENT NO. 1 TO FORM S-3 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 15, 1995 REGISTRATION NO. 33-64861 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------- AMENDMENT NO. 1 TO FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ---------------- MBIA INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) CONNECTICUT 06-1185706 (STATE OR OTHER (IRS EMPLOYER JURISDICTION OF IDENTIFICATION NO.) INCORPORATION OR ORGANIZATION) 113 KING STREET ARMONK, NEW YORK 10504 (914) 273-4545 (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) LOUIS G. LENZI, ESQ. GENERAL COUNSEL AND CORPORATE SECRETARY MBIA INC. 113 KING STREET ARMONK, NEW YORK 10504 (914) 273-4545 (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE OF AGENT FOR SERVICE) ---------------- COPIES TO: ANDREW L. SOMMER, ESQ. LEE MEYERSON, ESQ. DEBEVOISE & PLIMPTON SIMPSON THACHER & BARTLETT 875 THIRD AVENUE 425 LEXINGTON AVENUE NEW YORK, NEW YORK 10022 NEW YORK, NEW YORK 10017 ---------------- APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC. As soon as practicable after the effective date of this Registration Statement. 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, please check the following box. [_] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, 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, please 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. [_] ---------------- 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. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ +INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A + +REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE + +SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY + +OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT + +BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR + +THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE + +SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE + +UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF + +ANY SUCH STATE. + ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subject to Completion, dated December 15, 1995 PROSPECTUS [LOGO] MBIA $75,000,000 MBIA INC. % DEBENTURES DUE , 2025 ------------- INTEREST PAYABLE AND ------------- Interest on the % Debentures due , 2025 (the "Debentures") of MBIA Inc. (the "Company") is payable semi-annually in arrears on and of each year, commencing , 1996. The Debentures will mature on , 2025. The Debentures may not be redeemed prior to maturity by the Company and are not subject to any sinking fund. The Debentures will be represented by one global security registered in the name of a nominee of The Depository Trust Company, as Depositary (the "Depositary"). Beneficial interests in the global security representing the Debentures will be shown on, and transfers thereof will be effected only through, records maintained by the Depositary and its participants. Except as described herein, Debentures in certificated form will not be issued in exchange for the global security. The Debentures will trade in the Depositary's Same-Day Funds Settlement System until maturity, and secondary market trading activity for the Debentures will therefore settle in immediately available funds. All payments of principal and interest will be made by the Company in immediately available funds. See "Description of Debentures". ------------- 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. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. - -------------------------------------------------------------------------------- - --------------------------------------------------------------------------------
Price to Underwriting Proceeds to Public(1) Discount(2) Company(1)(3) - -------------------------------------------------------------------------------- Per Debenture............................. % % % - -------------------------------------------------------------------------------- Total..................................... $ $ $
- -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (1) Plus accrued interest, if any, from , 1995 to the date of delivery. (2) The Company has agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933. See "Underwriting." (3) Before deducting expenses payable by the Company estimated at $ . ------------- The Debentures offered by this Prospectus are offered by the Underwriters, subject to prior sale, withdrawal, cancellation or modification of the offer without notice, to delivery to and acceptance by the Underwriters and to certain further conditions. It is expected that delivery of the Debentures will be made at the offices of Lehman Brothers Inc., New York, New York on or about , 1995. ------------- LEHMAN BROTHERS DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION GOLDMAN, SACHS & CO. MERRILL LYNCH & CO. , 1995 IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE DEBENTURES OFFERED HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE COMMISSIONER OF INSURANCE FOR THE STATE OF NORTH CAROLINA, NOR HAS THE COMMISSIONER RULED UPON THE ACCURACY OR ADEQUACY OF THIS DOCUMENT. AVAILABLE INFORMATION The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files reports, proxy statements and other information with the Securities and Exchange Commission (the "Commission"). Such reports and proxy and information statements and other information concerning the Company may be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549 and at the following regional offices of the Commission: Northwestern Atrium Center, 500 West Madison Street, Chicago, Illinois 60661, 14th Floor; Seven World Trade Center, Suite 1300, New York, New York 10048, and at the offices of the New York Stock Exchange, 20 Broad Street, New York, New York 10005. Copies of such material can be obtained by mail from the Public Reference Section of the Commission at 450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549, at prescribed rates. The indenture pursuant to which the Debentures will be issued (the "Indenture") provides that the Company must file with the Commission and provide to the trustee under the Indenture and to the registered holders of the Debentures copies of the annual reports and other information, documents, and reports specified in Sections 13 and 15 of the Exchange Act so long as the Debentures are outstanding. 2 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents are incorporated herein by reference: (1) The Company's Annual Report on Form 10-K for the year ended December 31, 1994. (2) The Company's Quarterly Report on Form 10-Q for each of the first three calendar quarters of 1995 and a Form 10-Q/A dated November 30, 1995 relating to the quarter ended June 30, 1995. Any documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus and prior to the termination of the offering of the Debentures offered hereby shall be deemed to be incorporated by reference in this Prospectus and to be a part hereof. Any statement contained in a document incorporated or deemed to be incorporated by reference herein, or contained in this Prospectus, shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. The Company will provide without charge to each person to whom this Prospectus is delivered, upon the written or oral request of such person, a copy of any or all of the foregoing documents incorporated herein by reference (other than exhibits to such documents unless such exhibits are specifically incorporated by reference into the foregoing documents). Any such request should be directed to: Louis G. Lenzi, Esq., MBIA Inc., 113 King Street, Armonk, New York 10504 (telephone: (914) 273-4545). 3 THE COMPANY MBIA Inc. (the "Company") insures municipal bonds, asset-backed securities and other non-municipal bonds through its wholly-owned subsidiary, MBIA Insurance Corporation ("MBIA Corp."), formerly known as Municipal Bond Investors Assurance Corporation. MBIA Corp. is the successor to the business of Municipal Bond Insurance Association (the "Association"), a consortium of multi-line insurers, which began writing municipal bond insurance in 1974. Effective as of December 31, 1989, the Company purchased Bond Investors Guaranty Insurance Company ("BIG Ins."), another financial guarantee insurance company, through the acquisition of all of the common stock of its parent company, Bond Investors Group, Inc. ("BIG"). Subsequently, MBIA Corp. reinsured the net exposure on the insurance policies previously issued by BIG Ins. and the Company contributed the common stock of BIG to MBIA Corp. On August 21, 1990, the Company changed the name of BIG Ins. to MBIA Insurance Corp. of Illinois ("MBIA Illinois"). Subsequently, BIG was merged into MBIA Illinois. As of September 30, 1995, the total net par amount of outstanding bonds insured by MBIA Corp. and MBIA Illinois was $181.5 billion and the aggregate net insurance in force was $332.7 billion. Financial guarantee insurance provides an unconditional and irrevocable guarantee of the payment of the principal of and interest on insured obligations when due. MBIA Corp. primarily insures obligations sold in the new issue and secondary markets, including those held in unit investment trusts and by mutual funds. It also provides surety bonds for debt service reserve funds. The principal economic value of financial guarantee insurance to the entity offering the obligations is the saving in interest costs resulting from the difference in the market yield between an insured obligation and the same obligation on an uninsured basis. In addition, for complex financings and for obligations of issuers that are not well known by investors, insured obligations receive greater market acceptance than uninsured obligations. All obligations insured by MBIA Corp. (as well as obligations previously insured by MBIA Illinois) are rated AAA by both Standard & Poor's Ratings Group, a division of The McGraw-Hill Companies, Inc. and Fitch Investors Service, L.P. and Aaa by Moody's Investors Service, Inc., the highest ratings assigned by these rating agencies. MBIA Corp. derives its income from insurance premiums earned over the life of the insured obligations and from investment income earned on assets representing capital, retained earnings, and deferred premium revenues. As of September 30, 1995, the Company's deferred premium revenues were $1,599 million, its shareholders' equity was $2,090 million, and its total investments were $5,946 million and $6,138 million at book value and market value, respectively. As of September 30, 1995, MBIA Corp.'s investment portfolio was $3,520 million and $3,668 million at book value and market value, respectively, and was primarily comprised of high quality fixed income securities with intermediate maturities. In 1990, the Company formed a French company, MBIA Assurance S.A. ("MBIA Assurance"), to assist in writing financial guarantee insurance in the countries of the European Community. MBIA Assurance, which is a subsidiary of MBIA Corp., writes policies insuring public infrastructure financings, asset- backed transactions and certain obligations of financial institutions. As of September 30, 1995, MBIA Corp. and MBIA Assurance had collectively insured 50 transactions. Over the last three years, the Company has undertaken the development of investment management services which capitalize on its capabilities, reputation and marketplace relationships. The Company is delivering these services through a group of subsidiary companies. For the nine months ended September 30, 1995, in the aggregate, these investment management ventures contributed $10 million to revenues. The principal executive offices of the Company are located at 113 King Street, Armonk, New York 10504. The telephone number is (914) 273-4545. 4 CAPITALIZATION The following table sets forth the total capitalization of the Company at September 30, 1995 and such capitalization as adjusted to give effect to the issuance and sale of the Debentures (without giving effect to the payment of expenses).
SEPTEMBER 30, 1995 --------------------------------- ACTUAL AS ADJUSTED -------------- ----------------- (UNAUDITED) (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA) Long-term debt................................. $ 298,872 $ 373,872 -------------- -------------- Shareholders' equity: Preferred Stock, par value $1.00 per share; authorized shares--10,000,000; issued and outstanding shares--none.................... -- -- Common Stock, par value $1.00 per share; au- thorized shares--200,000,000; issued shares--42,077,387.......................... 42,077 42,077 Additional paid-in capital................... 722,478 722,478 Retained earnings............................ 1,212,628 1,212,628 Cumulative translation adjustment............ 2,609 2,609 Unrealized appreciation of investments, net of taxes of $67,879......................... 125,075 125,075 Treasury shares at cost (248,331 shares)..... (14,583) (14,583) -------------- -------------- Total shareholders' equity................. 2,090,284 2,090,284 -------------- -------------- Total capitalization..................... $2,389,156 $2,464,156 ============== ==============
5 SELECTED CONSOLIDATED FINANCIAL AND STATISTICAL DATA The selected consolidated financial data in the table below for each of the five years in the period ended December 31, 1994 have been derived from audited consolidated financial statements of the Company previously filed with the Commission. The selected consolidated financial data at September 30, 1994 and 1995 and for the nine months ended September 30, 1994 and 1995 are unaudited but in the opinion of management include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation. The following information should be read in conjunction with the consolidated financial statements and related notes of the Company included, or incorporated by reference, in the Company's periodic reports filed under the Exchange Act that are incorporated by reference herein. See "Incorporation of Certain Documents by Reference."
NINE MONTHS YEARS ENDED DECEMBER 31, ENDED SEPTEMBER 30, ----------------------------------------------------------- ---------------------- 1990 1991 1992 1993 1994 1994 1995 ---------- ---------- ---------- ---------- ---------- ---------- ---------- (UNAUDITED) (DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA) INCOME STATEMENT DATA: Insurance: Gross premiums written. $ 211.4 $ 269.2 $ 368.7 $ 479.3 $ 360.8 $ 274.4 $ 269.2 Net premiums written... 181.5 223.0 336.1 431.8 311.6 235.7 237.0 Premiums earned........ 106.7 132.2 162.9 231.3 218.3 162.9 160.6 Net investment income.. 115.3 131.6 150.5 178.9 193.9 144.2 162.9 Net realized gains (losses).............. (0.2) 2.9 9.8 9.7 10.3 9.7 8.1 Investment management services: Income................. -- 0.6 2.3 4.7 16.2 12.0 13.7 Net realized gains (losses).............. -- -- -- 0.1 (0.7) (0.6) (3.4) Income before income taxes................. 165.3 189.7 244.3 324.0 329.4 248.4 258.3 Net income............. 126.6 144.7 188.7 259.0 260.2 195.7 203.1 PER SHARE DATA: Earnings............... $ 3.33 $ 3.74 $ 4.62 $ 6.10 $ 6.18 $ 4.65 $ 4.82 Dividends: Declared............... 0.48 0.62 0.76 0.94 1.14 0.83 0.965 Paid................... 0.44 0.59 0.72 0.89 1.09 0.78 0.930 Book value............. 24.35 27.58 33.00 38.18 40.96 41.09 49.97 BALANCE SHEET DATA: Investments............ $ 1,724.5 $ 1,961.4 $ 2,528.7 $ 3,544.3 $ 4,866.8 $ 4,683.1 $ 6,138.4 Total assets........... 2,158.8 2,438.5 3,049.2 4,106.3 5,456.4 5,264.0 6,758.1 Deferred premium revenue............... 902.1 1,018.6 1,196.2 1,402.8 1,512.2 1,488.5 1,598.6 Loss and loss adjustment expense reserves.............. 5.0 21.2 25.5 33.7 40.1 38.8 45.2 Long-term debt......... 200.0 198.7 298.6 298.7 298.8 298.8 298.9 Shareholders' equity... 931.7 1,063.3 1,382.1 1,596.4 1,704.7 1,714.2 2,090.3 SELECTED FINANCIAL RATIOS: GAAP Basis(1)(3): Loss ratio............. 4.7% 13.0% 3.4% 3.4% 3.7% 3.5% 5.0% Expense ratio.......... 33.7% 30.1% 32.0% 27.4% 28.8% 28.7% 28.2% Combined ratio......... 38.4% 43.1% 35.4% 30.8% 32.5% 32.2% 33.2% SAP Basis(2)(3): Loss ratio............. -- 12.7% 2.4% (3.5%) 9.8% 13.1% (0.4%) Expense ratio.......... 23.4% 20.4% 18.3% 17.6% 22.9% 22.0% 18.8% Combined ratio......... 23.4% 33.1% 20.7% 14.1% 32.7% 35.1% 18.4% OTHER FINANCIAL DATA: Net par amount outstanding........... $ 75,979.2 $ 90,042.9 $112,483.0 $141,386.8 $164,317.9 $159,558.7 $181,481.0 Net debt service outstanding........... 157,706.5 184,604.3 223,056.1 266,784.3 304,501.6 295,227.2 332,741.1
- ------- (1) The GAAP loss ratio is the provision for losses and loss adjustment expenses divided by net premiums earned, and the GAAP expense ratio is underwriting expenses (adjusted for deferred policy acquisition costs) and operating expenses (excluding interest expense) divided by net premiums earned, in each case calculated in accordance with generally accepted accounting principles. The combined ratio is the total of the loss and expense ratios (see Note 2 to the Consolidated Financial Statements of MBIA Inc. and Subsidiaries). (2) The SAP loss ratio is the provision for losses and loss adjustment expenses divided by net premiums earned, and the SAP expense ratio is underwriting expenses divided by net premiums written, in each case calculated in accordance with statutory accounting practices. The combined ratio is the total of the loss and expense ratios. (3) For a discussion of the principal differences between GAAP and SAP accounting, see Note 3 to the Consolidated Financial Statements of MBIA Inc. and Subsidiaries. 6 RATIO OF EARNINGS TO FIXED CHARGES The following table sets forth the ratio of earnings to fixed charges for the Company for the periods indicated. Earnings represent consolidated earnings before income taxes and fixed charges. Fixed charges consist of interest and that portion of rental expense deemed representative of the interest factor for such rental expense. The Company had no capitalized interest for the periods presented.
NINE MONTHS ENDED YEARS ENDED DECEMBER 31, SEPTEMBER 30, ------------------------ ------------- 1990 1991 1992 1993 1994 1994 1995 ---- ---- ---- ---- ---- ------ ------ Ratio of earnings to fixed charges(1).... 10.6 11.2 12.9 13.0 13.1 13.3 13.1
- -------- (1) Fixed charges do not include the amount of fixed charges associated with obligations insured by MBIA Corp. USE OF PROCEEDS The net proceeds to the Company from the sale of the Debentures will be used to provide additional capital for the future needs of the Company and MBIA Corp. and for general corporate purposes. DESCRIPTION OF DEBENTURES The Debentures offered hereby will represent direct unsecured obligations of the Company and will be issued under an Indenture, dated as of August 1, 1990, between the Company and The First National Bank of Chicago, as Trustee (the "Trustee"). The Debentures will be unsecured and unsubordinated obligations of the Company and will rank equally and ratably with other unsecured and unsubordinated obligations of the Company. The Debentures offered hereby will be limited to $75,000,000 aggregate principal amount and will mature on , 2025. Each Debenture will bear interest at the rate of % per annum from , 1995 or from the most recent interest payment date to which interest has been paid or provided for, payable semi-annually on and of each year, commencing , 1996 to the person in whose name such Debenture is registered at the close of business on or , as the case may be, next preceding such interest payment date. The Debentures will not be redeemable at any time prior to maturity. The Debentures do not provide for any sinking fund. The Debentures will be subject to defeasance and covenant defeasance as provided in Article Thirteen of the Indenture. The following statements are subject to the detailed provisions of the Indenture, a copy of which is filed as an exhibit to the Registration Statement of which this Prospectus is a part. References in parentheses refer to sections of the Indenture. For the definition of certain capitalized terms used in this Description of Debentures, see "Definitions" below. Wherever particular provisions of the Indenture are referred to, such provisions are incorporated by reference as a part of the statements made and the statements are qualified in their entirety by such reference. 7 CERTAIN COVENANTS OF THE COMPANY LIMITATIONS ON LIENS Under the Indenture, so long as Debentures are outstanding, the Company will not, and will not permit any Subsidiary to, directly or indirectly, create, issue, assume, incur or guarantee any indebtedness for borrowed money which is secured by a Mortgage of any nature on any of the present or future capital stock of any Restricted Subsidiary unless the Debentures then outstanding shall be secured equally and ratably with, or prior to, such other secured debt so long as it is outstanding. (Section 3.6) LIMITATIONS ON DISPOSITION OF STOCK OF RESTRICTED SUBSIDIARIES Under the Indenture, so long as Debentures are outstanding, the Company will not, and will not permit any Subsidiary to, sell, transfer or otherwise dispose of any shares of capital stock of any Restricted Subsidiary except for (i) a sale, transfer or other disposition of any capital stock of any Restricted Subsidiary to a wholly-owned Subsidiary of the Company or such Subsidiary; (ii) a sale, transfer or other disposition of the entire capital stock of any Restricted Subsidiary for at least fair value (as determined by the Board of Directors of the Company acting in good faith); or (iii) a sale, transfer or other disposition of the capital stock of any Restricted Subsidiary for at least fair value (as determined by the Board of Directors of the Company acting in good faith) if, after giving effect thereto, the Company and its Subsidiaries would own more than 80% of the issued and outstanding Voting Stock of such Restricted Subsidiary. (Section 3.7) CONSOLIDATION, MERGER, SALE OR CONVEYANCE Under the Indenture, so long as Debentures are outstanding, the Company will not consolidate with or merge with or into any other corporation or convey, transfer or lease its properties or assets as an entirety or substantially as an entirety to any person, unless (i) the successor or purchaser is a corporation organized and existing under the laws of the United States of America, any State thereof or the District of Columbia; (ii) such successor or purchaser shall expressly assume, by supplemental indenture satisfactory in form to the Trustee, the due and punctual payment of the principal of, premium, if any, and interest on all the Debentures and the performance and observance of every covenant and condition of the Company under the Indenture; and (iii) immediately after giving effect to such transaction, no Event of Default, and no event which, after notice or lapse of time or both, would become an Event of Default, shall have occurred and be continuing under the Indenture. (Section 9.1) EVENTS OF DEFAULT Any one of the following events will constitute an Event of Default with regard to Debentures under the Indenture: (i) default continued for 30 days in payment of any instalment of interest on any of the Debentures when due; (ii) default in payment of all or any part of the principal of the Debentures when due and payable either at maturity, upon any redemption, by declaration or otherwise; (iii) default continued for 60 days after notice of such default in performance of any covenant or warranty of the Indenture by the Company in respect of the Debentures; (iv) certain events of default with respect to indebtedness of the Company (other than the Debentures or non-recourse obligations of the Company) in an aggregate principal amount in excess of $10,000,000 which default shall consist of the failure to make any payment at maturity or shall have resulted in the acceleration of the maturity of such indebtedness; or (v) certain events of bankruptcy, insolvency, or reorganization of the Company or any Restricted Subsidiary. (Section 5.1) The Company is required to file with the Trustee annually a written statement as to the fulfillment of certain of its obligations under the Indenture. (Section 3.5) The Indenture provides that the Trustee may withhold notice to 8 the holders of Debentures of any default (except in payment of principal of or premium, if any, or interest on the Debentures) if the Trustee considers it in the interest of the holders of the Debentures to do so. (Section 5.11) The Indenture provides that (a) if an Event of Default described in clause (i) or (ii) above shall have occurred and be continuing with regard to the Debentures, either the Trustee or the holders of 25% in aggregate principal amount of the Debentures then outstanding may declare the principal of such Debentures and interest accrued thereon, if any, to be due and payable immediately and (b) if an Event of Default described in clause (iii), (iv) or (v) above shall have occurred and be continuing, either the Trustee or the holders of 25% in aggregate principal amount of all Debt Securities (or in the case of an Event of Default described in clause (iii) above, all series affected by such Event of Default) then outstanding (voting as a single class) may declare the principal of all Debt Securities (in the case of clause (iii) above, limited to all series affected) then outstanding and interest accrued thereon, if any, to be due and payable immediately. Upon certain conditions, such declaration by the holders of Debt Securities of any series may be annulled and past defaults which have been cured may be waived by (a) with respect to clauses (i) or (ii) the holders of a majority in aggregate principal amount of Debt Securities of such series (each such series voting as a separate class) then outstanding and (b) with respect to clauses (iii), (iv) or (v) above, the holders of a majority in aggregate principal amount of the Debt Securities of all series (in the case of clause (iii) above, limited to all series affected by such default) then outstanding (voting as a single class). (Section 5.1) Prior to a declaration of acceleration of maturity of the Debt Securities of any series, the holders of a majority in aggregate principal amount of the Debt Securities of each series voting separately or all series voting as a single class, depending on the nature of the Event of Default, may waive any Event of Default, and its consequences, except a default in the payment of the principal of or premium, if any, or interest on any of the Debt Securities of such series or in respect of a covenant or provision of the Indenture which cannot be modified or amended without the consent of the holder of each Debt Security of such series affected. (Section 5.10) Subject to the provisions of the Indenture relating to the duties of the Trustee, the Trustee shall be under no obligation to exercise any of its rights or powers under the Indenture at the request, order or direction of any of the holders of Debentures, unless such holders shall have offered the Trustee reasonable indemnity. (Section 6.2) Subject to such provision for indemnification, the holders of a majority in aggregate principal amount of the Debentures shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee. (Section 5.9) DEFEASANCE AND COVENANT DEFEASANCE The Indenture provides that, subject to certain conditions, the Company may elect either (i) to be discharged from any and all obligations with respect to the Debentures (except for the obligations to register the transfer or exchange of the Debentures, to replace temporary or mutilated, defaced, destroyed, lost or stolen Debentures, to maintain an office or agency for the payment of principal and interest in respect of the Debentures, to appoint a paying agent and, if the Company elects to act as the paying agent, to hold moneys for such payment in trust) ("Defeasance") or (ii) to be released from its obligations with respect to the Debentures under Sections 3.6 and 3.7 of the Indenture (being the sections of the Indenture captioned "Limitations on Liens" and "Limitations on Disposition of Stock of Restricted Subsidiaries" -- see "Certain Covenants of the Company") ("Covenant Defeasance"), upon the deposit with the Trustee (or another qualifying trustee) irrevocably in trust for such purpose, of money and/or United States government obligations in an amount which, in the opinion of a nationally recognized firm of independent public accountants delivered to such trustee, would be sufficient to pay the principal of and premium, if any, and interest on the Debentures on the scheduled due dates therefor. (Sections 13.1 through 13.4) 9 The Indenture provides that, to effect Defeasance or Covenant Defeasance, the Company must deliver to the Trustee an opinion of counsel to the effect that Defeasance or Covenant Defeasance, as the case may be, will not cause the holders of the Debentures to recognize income, gain or loss for federal income tax purposes. In addition, in the case of Defeasance, such opinion of counsel must state that a private letter ruling or a revenue ruling to the same effect has been issued by the United States Internal Revenue Service or state that since the date of the Indenture there has been a change in the applicable federal income tax law to the same effect. (Sections 13.3 and 13.4) MODIFICATION AND WAIVER The Indenture provides that the Company may enter into a supplemental indenture or indentures for the purpose of adding to, changing or eliminating any of the provisions of the Indenture or of any supplemental indentures or of modifying the rights of the holders of Debt Securities issued thereunder if approved in writing signed by the holders of not less than a majority in aggregate principal amount of all outstanding Debt Securities affected thereby voting as one class; provided that the consent of each holder of Debentures affected thereby is required for any modification or alteration which (i) extends the final maturity of any Debentures, or reduces the principal amount thereof, or reduces the rate or extends the time of payment of interest thereon, or reduces any amount payable on redemption thereof or impairs or affects the right of any holder of Debentures to institute suit for the payment thereof, or (ii) reduces the percentage in aggregate principal amount, the consent of the holders of which is required for any such supplemental indenture. (Section 8.2) The holders of at least a majority in aggregate principal amount of the outstanding Debt Securities of all series (including the Debentures) voting as one class may waive compliance by the Company with certain covenants contained in the Indenture (being the Sections of the Indenture captioned "Limitations on Liens;" "Limitations on Disposition of Stock of Restricted Subsidiaries;" "Corporate Existence"). (Section 3.9) BOOK-ENTRY, DELIVERY AND FORM The Debentures may be issued in the form of one or more fully registered global securities (each, a "Registered Global Security"), which will be deposited with, or on behalf of the depositary named in this Prospectus and registered in the name of such depositary or its nominee. (Section 2.12) Except as set forth below, Debentures will be available for purchase in book- entry form only in denominations of $1,000 and integral multiples thereof. Upon issuance, all Debentures will be represented by one fully registered global security (the "Registered Global Security"). The Registered Global Security will be deposited with, or on behalf of, The Depository Trust Company, as Depositary, and registered in the name of the Depositary or a nominee thereof. The Registered Global Security may be transferred, in whole but not in part, by the Depositary to a nominee of such Depositary or by a nominee of such Depositary to such Depositary or another nominee of such Depositary or by such Depositary or any such nominee to a successor Depositary selected or approved by the Company or to a nominee of such successor Depositary. The Depositary has advised the Company as follows: The Depositary is a limited-purpose trust company organized under the Banking Law of the State of New York, 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 Exchange Act. The Depositary was created to hold securities of its participants and to facilitate the clearance and settlement of transactions among its participants in such securities through electronic computerized book-entry changes in accounts of the participants, thereby eliminating the need for physical movement of securities certificates. Direct participants include securities brokers and dealers (including the Underwriters), banks, trust companies, clearing corporations, and certain other organizations ("Direct Participants"). The Depositary is owned by a number of its Direct Participants 10 and by the New York Stock Exchange, Inc., the American Stock Exchange, Inc. and the National Association of Securities Dealers, Inc. Access to the Depositary book-entry system is also available to others, such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly. Persons who are not participants may beneficially own securities held by the Depositary only through Direct Participants. The rules applicable to the Depositary and its participants are on file with the Commission. Ownership of beneficial interests in the Debentures will be limited to persons that have accounts with the Depositary ("Agent Members") or persons that may hold interests through Agent Members. The Depositary has advised the Company that upon the issuance of the Registered Global Security representing the Debentures, the Depositary will credit, on its book-entry registration and transfer system, the Agent Members' accounts with the respective principal amounts of the Debentures beneficially owned by such Agent Members. Ownership of beneficial interests in such Registered Global Security will be shown on, and the transfer of such ownership interests will be effected only through, records maintained by the Depositary (with respect to interests of Agent Members) and on the records of Agent Members (with respect to interests of persons holding through Agent Members). The laws of some states may require that certain purchasers of securities take physical delivery of such securities in definitive form. Such limits and such laws may impair the ability to own, transfer or pledge beneficial interests in the Registered Global Security. So long as the Depositary, or its nominee, is the registered owner of the Registered Global Security, the Depositary or its nominee, as the case may be, will be considered the sole owner or Holder of the Debentures represented by such Registered Global Security for all purposes under the Indenture. Except as provided below, owners of beneficial interests in the Registered Global Security will not be entitled to have the Debentures represented by such Registered Global Security registered in their names, will not receive or be entitled to receive physical delivery of the Debentures in definitive form and will not be considered the owners or Holders thereof under the Indenture. Accordingly, each Person owning a beneficial interest in the Registered Global Security must rely on the procedures of the Depositary and, if such Person is not an Agent Member, on the procedures of the Agent Member through which such Person owns its interest, to exercise any rights of a Holder under the Indenture. The Company understands that under existing industry practices, in the event that the Company requests any action of Holders or that an owner of a beneficial interest in the Registered Global Security desires to give or take any action which a Holder is entitled to give or take under the Indenture, the Depositary would authorize the Agent Members holding the relevant beneficial interests to give or take such action, and such Agent Members would authorize beneficial owners owning through such Agent Members to give or take such action or would otherwise act upon the instructions of beneficial owners holding through them. Payment of principal of, and interest on, Debentures registered in the name of the Depositary or its nominee will be made by wire transfer of immediately available funds on the date such payment is due to the Depositary or its nominee, as the case may be, as the Holder of the Registered Global Security representing such Debentures. None of the Company, the Trustee or any other agent of the Company or agent of the Trustee will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests or for supervising or reviewing any records relating to such beneficial ownership interests. The Company expects that the Depositary, upon receipt of any payment of principal or interest in respect of the Registered Global Security, will credit the accounts of the Agent Members with payment in amounts proportionate to their respective beneficial interests in such Registered Global Security as shown on the records of the Depositary. The Company also expects that payments by Agent Members to owners of beneficial interests in the Registered Global Security will be governed by standing customer instructions and customary practices, as is now the case with securities held for the accounts of customers in bearer form or registered in "street name", and will be the responsibility of such Agent Members. 11 If (x) the Depositary notifies the Company that it is at any time unwilling or unable to continue as Depositary or the Depositary ceases to be a clearing agency registered under the Exchange Act, and a successor Depositary is not appointed by the Company within 90 days after the Company receives such notice, or becomes aware of such condition, as the case may be, or (y) the Company executes and delivers to the Trustee an Officers' Certificate to the effect that the Registered Global Security shall be transferable and exchangeable, the Registered Global Security will be transferable or exchangeable for Debentures in definitive form of an equal aggregate principal amount without coupons and in denominations of $1,000 and integral multiples thereof. Such definitive Debentures shall be registered in such name or names as the Depositary shall instruct the Trustee. It is expected that such instructions may be based upon directions received by the Depositary from Agent Members with respect to ownership of beneficial interests in the Registered Global Security. SAME-DAY SETTLEMENT AND PAYMENT Settlement for the Debentures will be made by the Underwriters in immediately available funds. Secondary trading in long-term notes and debentures of corporate issuers is generally settled in clearing-house or next-day funds. In contrast, the Debentures will trade in the Same-Day Funds Settlement System maintained by the Depositary until maturity, and secondary market trading activity in the Debentures will therefore be required by the Depositary to settle in immediately available funds. No assurance can be given as to the effect, if any, of settlement in immediately available funds on trading activity in the Debentures. CONCERNING THE TRUSTEE The Trustee, The First National Bank of Chicago, performs services for the Company in the ordinary course of business. DEFINITIONS The covenants and other provisions relating to the Debt Securities (including the Debentures) are to be read in conjunction with the definitions contained in the Indenture, certain of which are substantially to the following effect: "Debt Securities" means all unsecured debt securities, notes or other evidences of indebtedness issued in one or more series that the Company may issue from time to time in accordance with the terms of the Indenture. "Mortgage" means any mortgage, pledge, lien, security interest or other encumbrance. "Restricted Subsidiary" means MBIA Corp. and any successor to all or substantially all of its business, provided that such successor is a Subsidiary. "Subsidiary" means a corporation more than 50% of the outstanding Voting Stock of which is owned, directly or indirectly, by the Company or by one or more other Subsidiaries, or by the Company and one or more other Subsidiaries. "Voting Stock" means, with respect to any Subsidiary, stock of any class or classes (or equivalent interests), if the holders of the stock of such class or classes (or equivalent interests) are ordinarily, in the absence of contingencies, entitled to vote for the election of the directors (or persons performing similar functions) of such corporation, even though the right so to vote has been suspended by the happening of such a contingency. 12 UNDERWRITING Subject to the terms and conditions set forth in the Underwriting Agreement (which is filed as an exhibit to the Registration Statement of which this Prospectus is a part), the Company has agreed to sell to each of the Underwriters named below, and each of the Underwriters has severally agreed to purchase from the Company, the principal amount of the Debentures set forth opposite its name below.
PRINCIPAL AMOUNT UNDERWRITERS OF DEBENTURES ------------ ---------------- Lehman Brothers Inc. ...................................... $ Donaldson, Lufkin & Jenrette Securities Corporation........ Goldman, Sachs & Co. ...................................... Merrill Lynch, Pierce, Fenner & Smith Incorporated.......................................... ----------- Total.................................................. $75,000,000 ===========
Under the terms and conditions of the Underwriting Agreement, the Underwriters are committed to take and pay for all of the Debentures if any are taken. The Company has been advised that the Underwriters propose initially to offer the Debentures to the public at the public offering price set forth on the cover page of this Prospectus, and to certain dealers at such price less a concession not in excess of % of the principal amount. The Underwriters may allow, and such dealers may reallow, a concession not in excess of % of the principal amount to certain other dealers. After the initial public offering, the public offering price and such concessions may be changed. The Company has agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended, or to contribute to payments that the Underwriters may be required to make in respect thereof. The Company does not intend to list the Debentures on any securities exchange or on the NASDAQ National Market. The Company has been advised by each Underwriter that it presently intends to make a market in the Debentures; however, the Underwriters are not obliged to do so. Any such market-making activity may be discontinued at any time, for any reason, without notice. If each Underwriter ceases to act as a market maker for the Debentures for any reason, there can be no assurance that another firm or person will make a market in the Debentures. Accordingly, there can be no assurance that an active market for the Debentures will develop or, if a market does develop, at what prices the Debentures will trade. Certain of the Underwriters have provided from time to time, and expect to provide in the future, investment banking services to the Company and its affiliates, for which such Underwriters have received and will receive customary fees and commissions. LEGAL OPINIONS The validity of the Debentures offered hereby is being passed upon for the Company by Debevoise & Plimpton, 875 Third Avenue, New York, New York 10022, and for the Underwriters by Simpson Thacher & Bartlett (a partnership which includes professional corporations), 425 Lexington Avenue, New York, New York 10017. Such counsel may rely, as to matters of Connecticut law, upon the opinion of Day, Berry & Howard, CityPlace, Hartford, Connecticut 06103, Connecticut counsel for the Company. Simpson Thacher & Bartlett renders services to the Company on a regular basis. 13 EXPERTS The consolidated financial statements and the related consolidated financial statement schedules of the Company appearing or incorporated by reference in the Company's Annual Report on Form 10-K for the year ended December 31, 1994, have been audited by Coopers & Lybrand L.L.P., independent accountants, as set forth in their reports thereon dated February 1, 1995 incorporated by reference or included therein and incorporated herein by reference. Such consolidated financial statements and financial statement schedules are incorporated herein by reference in reliance upon such reports given upon the authority of such firm as experts in accounting and auditing. 14 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFOR- MATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY OF THE UNDERWRITERS. THIS PRO- SPECTUS DOES NOT CONSTITUTE AN OFFER OF ANY SECURITIES OTHER THAN THOSE TO WHICH IT RELATES OR AN OFFER TO SELL, OR SOLICITATION OF AN OFFER TO BUY, TO ANY PERSON IN ANY JURISDICTION WHERE SUCH AN OFFER OR SOLICITATION WOULD BE UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF. ----------------- TABLE OF CONTENTS
Page ---- Available Information...................................................... 2 Incorporation of Certain Documents by Reference............................ 3 The Company................................................................ 4 Capitalization............................................................. 5 Selected Consolidated Financial and Statistical Data....................... 6 Ratio of Earnings to Fixed Charges......................................... 7 Use of Proceeds............................................................ 7 Description of Debentures.................................................. 7 Underwriting............................................................... 13 Legal Opinions............................................................. 13 Experts.................................................................... 14
- ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- $75,000,000 MBIA % DEBENTURES DUE , 2025 ----------------- PROSPECTUS , 1995 ----------------- LEHMAN BROTHERS DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION GOLDMAN, SACHS & CO. MERRILL LYNCH & CO. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. The following table sets forth the estimated expenses in connection with the issuance and distribution of the Debentures being registered, other than underwriting discounts and commissions: Registration Fee................................................. $ 25,863 Trustee Fees..................................................... 7,500 Printing......................................................... 50,000 Accounting Fees.................................................. 30,000 Legal Fees....................................................... 40,000 Rating Agency Fees............................................... 70,000 Blue Sky Fees and Expenses....................................... 20,000 Miscellaneous.................................................... 6,637 -------- TOTAL........................................................ $250,000 ========
ITEM 15. INDEMNIFICATION OF OFFICERS AND DIRECTORS. Section 33-320a of the Stock Corporation Act of the State of Connecticut provides that a corporation shall indemnify a director or officer against judgments, fines, penalties, amounts paid in settlement and reasonable expenses actually incurred by him, including attorneys' fees, for actions brought or threatened to be brought against him in his capacity as a director or officer, other than actions brought by or in the right of the corporation, when it is determined by certain disinterested parties that he acted in a manner reasonably believed to be in the corporation's best interest. In any criminal action or proceeding, it also must be determined that the director or officer had no reason to believe that his conduct was unlawful. The director or officer must also be indemnified when he is successful on the merits in the defense of a proceeding or in circumstances where a court determines that he is fairly and reasonably entitled to be indemnified, and the court approves the amount. In connection with shareholder derivative suits, the director or officer may not be indemnified unless he is finally adjudged not to have breached his duty to the corporation or a court has determined that he is fairly and reasonably entitled to be indemnified, and then for such amount as the court shall determine. The statute provides that the indemnification provided thereby is exclusive and cannot be reduced or expanded by charter, by-law or agreement, although a corporation may procure insurance providing greater indemnification. The Company has purchased insurance providing officers and directors of the Company (and their heirs and other legal representatives) coverage against certain liabilities arising from any negligent act, error, omission or breach of duty claimed against them solely by reason of their being such officers and directors, and providing coverage for the Company against its obligation to provide indemnification as required by the above-described statute. The insurance policy has a $50 million aggregate policy limit for any loss or losses during the policy year. The Underwriting Agreement filed as Exhibit 1.01 hereto provides for indemnification of the Company's officers and directors by the Underwriters under certain circumstances. The Amended and Restated Shareholders' Agreement among the Company and its Founding Shareholders provides for indemnification of the shareholders that are parties thereto under certain circumstances (filed as Exhibit 10.30 to the Company's Registration Statement on Form S-1 (Registration No. 33-14474)). II-1 ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES. (A) EXHIBITS 1. Underwriting Agreement. 1.01. Form of Underwriting Agreement.++ 4. Instruments Defining the Rights of Security Holders. 4.01. Indenture, dated as of August 1, 1990, between the Company and The First National Bank of Chicago, as trustee, incorporated by ref- erence to Exhibit 4.01 to the Company's Registration Statement on Form S-3 (Registration No. 33-33937). 5. Opinions as to Validity. 5.01. Opinion of Debevoise & Plimpton. 5.02. Opinion of Day, Berry & Howard. 12. Statement Re Computation of Ratios. 12.01. Computation of Ratios of Earnings to Fixed Charges.++ 23. Consents of Experts and Counsel. 23.01. Consent of Coopers & Lybrand L.L.P. 23.02. Consent of Debevoise & Plimpton (contained in Exhibit 5.01). 23.03. Consent of Day, Berry & Howard (contained in Exhibit 5.02). 24. Powers of Attorney. 24.01. Powers of Attorney.++ 25. Statement of Eligibility of Trustee. 25.01. Statement of Eligibility on Form T-1 under the Trust In- denture Act of 1939, as amended, of The First National Bank of Chicago.++
- -------- ++ Previously filed ITEM 17. UNDERTAKINGS. (A) The undersigned registrant hereby undertakes that: (1) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective. (2) For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus 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. (B) The undersigned registrant hereby undertakes 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 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. (C) 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 foregoing II-2 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 said 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. II-3 SIGNATURES PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT 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 ARMONK, NEW YORK, ON DECEMBER 15, 1995. MBIA Inc. (Registrant) /s/ David H. Elliott By __________________________________ DAVID H. ELLIOTT, CHAIRMAN AND CHIEF EXECUTIVE OFFICER PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE CAPACITIES AND ON THE DATES INDICATED:
SIGNATURE TITLE DATE --------- ----- ---- /s/ David H. Elliott Chairman, Chief Executive December 15, 1995 - ------------------------------------------- Officer and Director DAVID H. ELLIOTT (principal executive officer) /s/ Richard L. Weill President and Director December 15, 1995 - ------------------------------------------- RICHARD L. WEILL /s/ Julliette S. Tehrani Senior Vice President and December 15, 1995 - ------------------------------------------- Chief Financial Officer JULLIETTE S. TEHRANI (principal financial officer) /s/ Elizabeth B. Sullivan Vice President and December 15, 1995 - ------------------------------------------- Controller (principal ELIZABETH B. SULLIVAN accounting officer) /s/ William O. Bailey* Director December 15, 1995 - ------------------------------------------- WILLIAM O. BAILEY /s/ Joseph W. Brown, Jr.* Director December 15, 1995 - ------------------------------------------- JOSEPH W. BROWN, JR. /s/ David C. Clapp* Director December 15, 1995 - ------------------------------------------- DAVID C. CLAPP /s/ Claire L. Gaudiani* Director December 15, 1995 - ------------------------------------------- CLAIRE L. GAUDIANI
II-4
SIGNATURE TITLE DATE --------- ----- ---- /s/ William H. Gray, III* Director December 15, 1995 - ------------------------------------------- WILLIAM H. GRAY, III /s/ Freda S. Johnson* Director December 15, 1995 - ------------------------------------------- FREDA S. JOHNSON /s/ Daniel P. Kearney* Director December 15, 1995 - ------------------------------------------- DANIEL P. KEARNEY /s/ James A. Lebenthal* Director December 15, 1995 - ------------------------------------------- JAMES A. LEBENTHAL /s/ Robert B. Nicholas* Director December 15, 1995 - ------------------------------------------- ROBERT B. NICHOLAS /s/ Pierre-Henri Richard* Director December 15, 1995 - ------------------------------------------- PIERRE-HENRI RICHARD /s/ John A. Rolls* Director December 15, 1995 - ------------------------------------------- JOHN A. ROLLS
/s/ Louis G. Lenzi *By _________________________________ LOUIS G. LENZI ATTORNEY-IN-FACT II-5 EXHIBIT INDEX
EXHIBITS DESCRIPTION PAGE NO. 1. Underwriting Agreement. 1.01. Form of Underwriting Agreement.++ 4. Instruments Defining the Rights of Security Holders. 4.01. Indenture, dated as of August 1, 1990, between the Company and The First National Bank of Chicago, as trustee, incorporated by reference to Exhibit 4.01 to the Company's Registration Statement on Form S-3 (Registration No. 33-33937). 5. Opinions as to Validity. 5.01. Opinion of Debevoise & Plimpton. 5.02. Opinion of Day, Berry & Howard. 12. Statement Re Computation of Ratios. 12.01. Computation of Ratios of Earnings to Fixed Charges.++ 23. Consents of Experts and Counsel. 23.01. Consent of Coopers & Lybrand L.L.P. 23.02. Consent of Debevoise & Plimpton (contained in Exhibit 5.01). 23.03. Consent of Day, Berry & Howard (contained in Exhibit 5.02). 24. Powers of Attorney. 24.01. Powers of Attorney.++ 25. Statement of Eligibility of Trustee. 25.01. Statement of Eligibility and Qualification on Form T-1 under the Trust Indenture Act of 1939, as amended, of The First National Bank of Chicago.++
- -------- ++ Previously filed. EX-5.01 2 OPINION OF DEBEVOISE & PLIMPTON EXHIBIT 5.01 [Letterhead of DEBEVOISE & PLIMPTON] December 15, 1995 MBIA Inc. 113 King Street Armonk, New York 10504 Registration Statement of Form S-3 Registration No. 33-64861 ---------------------------------- Ladies and Gentlemen: We have acted as counsel to MBIA Inc., a Connecticut corporation (the "Company"), in connection with the preparation and filing with the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended (the "Act"), of the Registration Statement (No. 33-64861) on Form S-3, as amended (the "Registration Statement"), and the prospectus included therein (the "Prospectus"), relating to the proposed issuance by the Company of $75,000,000 aggregate principal amount of Debentures due December __, 2025 (the "Debentures") under an Indenture, dated as of August 1, 1990 (the "Indenture"), between the Company and the First National Bank of Chicago, as Trustee. In so acting, we have examined and relied upon the originals, or copies certified or otherwise identified to our satisfaction, of such records, documents and other instruments as in our judgment are necessary or appropriate to enable us to render the opinion expressed below. Our MBIA Inc. 2 December 15, 1995 opinion assumes that the Indenture will remain in substantially the form incorporated by reference as Exhibit 4.01 to the Registration Statement. Based on the foregoing, we are of the opinion that, when (a) the terms, - issuance, execution and delivery by the Company of any Debentures have been duly authorized by all necessary corporate action of the Company and as contemplated by the Indenture, and (b) such Debentures have been duly executed and delivered - by the Company, authenticated by the Trustee and sold as contemplated by each of the Registration Statement, the Prospectus and the Indenture, such Debentures will be validly issued and will constitute valid and binding obligations of the Company enforceable against the Company in accordance with their terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the rights of creditors generally and by general principles of equity. In rendering the opinion expressed above, we have relied as to all matters involving the law of the State of Connecticut on the opinion of Day, Berry & Howard, Connecticut counsel for the Company, dated today and addressed to you. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of our name under the heading "Legal Opinions" in the Prospectus. In giving such consent, we do not thereby concede that we are within the category of persons whose consent is required under Section 7 of the Act or the Rules and Regulations of the Commission thereunder. Very truly yours, /s/ Debevoise & Plimpton EX-5.02 3 OPINION OF DAY, BERRY & HOWARD EXHIBIT 5.02 [Letterhead of Day, Berry & Howard] December 15, 1995 MBIA Inc. 113 King Street Armonk, New York 10504 Re: MBIA Inc. Registration Statement on Form S-3 Registration No. 33-64861 _________________________ Dear Ladies and Gentlemen: We have acted as special Connecticut counsel to MBIA Inc., a Connecticut corporation (the "Company"), as to certain matters of Connecticut law in connection with the preparation and filing with the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended (the "Act"), of the above referenced Registration Statement on Form S-3, as amended (the "Registration Statement") and the prospectus included therein (the "Prospectus"), relating to the proposed issuance by the Company of $75,000,000 aggregate principal amount of Debentures due __________, 2025 (the "Debentures") on terms to be determined at the time of offering. The Debentures will be issued under an Indenture, dated as of August 1, 1990 (the "Indenture"), between the Company and The First National Bank of Chicago, as Trustee. We have examined the Company's Certificate of Incorporation and By-Laws, both as amended and restated to date, records of the corporate proceedings of the Board of Directors of the Company with respect to the Debentures, the Registration Statement and the offering contemplated thereby and such other documents, and have made such examination of law, as we have deemed relevant and necessary in order to render our opinion. We have also examined and relied upon the form of the Indenture incorporated by reference as Exhibit 4.01 to the Registration Statement, the governing law of which is expressly stated to be that of the State of New York. For purposes of the opinion set forth below, we have assumed that the Indenture constitutes, and the Debentures, when duly MBIA Inc. December 15, 1995 Page 2 issued, will constitute, legal, valid and binding obligations of the Company under the laws of the State of New York (as to which we express no opinion). Our opinion assumes that the Indenture will remain in substantially the form incorporated by reference as Exhibit 4.01 to the Registration Statement. In rendering the opinion set forth below, we have assumed the corporate authority of the Trustee to enter into and perform the Indenture and the due authorization, execution and delivery of the Indenture by the Trustee. Based on and subject to the foregoing, we are of the opinion that when (a) the terms, issuance, execution and delivery by the Company of the Debentures have been duly authorized by all necessary corporate action of the Company and as contemplated by the Indenture and (b) the Debentures have been duly executed and delivered by the Company, authenticated by the Trustee and sold as contemplated by each of the Registration Statement, the Prospectus and the Indenture, and assuming that the terms of the Debentures are in compliance with the Indenture, the Debentures will be validly issued and will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, except that (i) enforcement of the Debentures may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors' rights generally and (ii) enforceability of the Debentures may be limited by general principles of equity. Our opinion expressed above is limited to the laws of the State of Connecticut. Messrs. Debevoise and Plimpton and Messrs. Simpson Thacher & Bartlett may rely upon this opinion as though it were addressed to them on the date hereof. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to our firm in the Prospectus under the caption "Legal Opinions." In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act, or the rules and regulations of the Commission thereunder. Very truly yours, /s/ Day, Berry & Howard EX-23.01 4 CONSENT OF COOPERS & LYBRAND EXHIBIT 23.01 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in this registration statement on Form S-3 (File No. 33-64861) of MBIA Inc. and Subsidiaries (the "Company") of: 1. Our report dated February 1, 1995, on our audits of the consolidated financial statements of the Company as of December 31, 1994 and 1993 and for each of the three years in the period ended December 31, 1994, which report is incorporated by reference into the Company's 1994 Annual Report on Form 10-K. 2. Our report dated February 1, 1995 on our audits of the financial statement schedules of the Company, which report is included in the Company's 1994 Annual Report on Form 10-K. We also consent to the reference to our firm under the caption "Experts". Coopers & Lybrand L.L.P. New York, New York December 14, 1995 -----END PRIVACY-ENHANCED MESSAGE-----