Filed Pursuant to Rule 424(b)(2)
Registration No. 333-108566
PROSPECTUS SUPPLEMENT
JULY 7, 2004
(TO PROSPECTUS DATED SEPTEMBER 16, 2003)
$1,150,000,000
[Graphic Omitted]
MARSH & MCLENNAN COMPANIES, INC.
$650,000,000 5.375% SENIOR NOTES DUE 2014
$500,000,000 FLOATING RATE SENIOR NOTES DUE 2007
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We will pay interest on the 5.375% Senior Notes due 2014 (the "Fixed Rate
Notes") on January 15 and July 15 of each year, beginning on January 15, 2005.
The Fixed Rate Notes will mature on July 15, 2014. At our option, we may redeem
the Fixed Rate Notes in whole or in part at any time and from time to time
before their maturity at the redemption price described herein under
"Description of Notes--Fixed Rate Notes--Optional Redemption."
We will pay interest on the Floating Rate Senior Notes due 2007 (the
"Floating Rate Notes" and together with the Fixed Rate Notes, the "Notes") on
January 13, April 13, July 13 and October 13 of each year, beginning on October
13, 2004. The rate of interest on the Floating Rate Notes is equal to three
month LIBOR plus 0.14% and will be reset quarterly. The Floating Rate Notes will
mature on July 13, 2007.
The Notes will be senior unsecured obligations of our company and will rank
equally with all of our other senior unsecured indebtedness from time to time
outstanding.
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PER FIXED PER FLOATING
RATE NOTE TOTAL RATE NOTE TOTAL
-------- ----------- --------- -----------
Public offering price (1) ............................ 99.824% $648,856,000 100.000% $500,000,000
Underwriting discount ................................ 0.450% $ 2,925,000 0.225% $ 1,125,000
Proceeds to the Company (before expenses)(1) ......... 99.374% $645,931,000 99.775% $498,875,000
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(1) Plus accrued interest, if any, from July 14, 2004, if settlement occurs
after that date.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS IS TRUTHFUL OR COMPLETE.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The notes will be ready for delivery in book-entry form through the
facilities of The Depository Trust Company, including for the accounts of
Euroclear Bank S.A./N.V., as operator of the Euroclear System and Clearstream
Banking, societe anonyme, on or about July 14, 2004.
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GLOBAL COORDINATOR AND JOINT BOOK-RUNNING MANAGER
FOR THE FIXED RATE NOTES AND THE FLOATING RATE NOTES
BANC OF AMERICA SECURITIES LLC
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JOINT BOOK-RUNNING MANAGERS FOR THE FIXED RATE NOTES
CITIGROUP DEUTSCHE BANK SECURITIES GOLDMAN, SACHS & CO.
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JOINT BOOK-RUNNING MANAGERS FOR THE FLOATING RATE NOTES
JPMORGAN MERRILL LYNCH & CO.
No person is authorized to give any information or to represent anything
not contained in this prospectus supplement or the accompanying prospectus. You
must not rely on any unauthorized information or representations. This
prospectus supplement and the accompanying prospectus are an offer to sell or to
buy only the Notes, but only under circumstances and in jurisdictions where it
is lawful to do so. The information contained in this prospectus supplement or
the accompanying prospectus as well as information previously filed with the
Securities and Exchange Commission and incorporated by reference is current only
as of the date of such information. Our business, financial condition, results
of operations and prospectus may have changed since that date.
References in this prospectus supplement and the accompanying prospectus to
"we," "us," "our," and "MMC" are to Marsh & McLennan Companies, Inc.
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TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
PAGE
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The Company .............................................................. S-1
Incorporation of Certain Documents By Reference .......................... S-1
Information Concerning Forward-Looking Statements ........................ S-2
Use of Proceeds .......................................................... S-2
Ratio of Earnings to Fixed Charges ....................................... S-2
Description of Notes ..................................................... S-3
Underwriting ............................................................. S-10
Legal Matters ............................................................ S-11
Experts .................................................................. S-11
PROSPECTUS
PAGE
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About This Prospectus .................................................... 3
Marsh & McLennan Companies, Inc. ......................................... 3
Use of Proceeds .......................................................... 3
Ratio of Earnings to Fixed Charges ....................................... 3
Description of Securities ................................................ 4
Description of Capital Stock ............................................. 4
Description of Debt Securities ........................................... 9
Plan of Distribution ..................................................... 12
Where You Can Find More Information ...................................... 13
Information Concerning Forward-Looking Statements ........................ 14
Legal Opinions ........................................................... 15
Experts .................................................................. 15
THE COMPANY
MMC is a global professional services firm with annual revenues exceeding
$11 billion. It is the parent company of Marsh Inc., the world's leading risk
and insurance services firm; Putnam Investments, one of the largest investment
management companies in the United States; and Mercer Inc., a major global
provider of consulting services. More than 60,000 employees provide analysis,
advice and transactional capabilities to clients in over 100 countries.
RECENT DEVELOPMENTS
On May 18, 2004, the Company announced that it would acquire Kroll Inc.,
the world's leading risk mitigation services firm, for $1.95 billion. The
Company plans to fund the acquisition with a combination of commercial paper,
long-term debt and cash from operations. In connection with the Kroll
acquisition, on May 19, 2004, Standard & Poor's Rating Services placed the
Company's ratings on CreditWatch with negative implications, and on July 7,
2004, lowered the Company's counterparty credit and short-term ratings from
AA-/A-1+ to A+/A-1 with a stable outlook. Moody's Investors Service has affirmed
the Company's debt ratings following the announcement of the acquisition. Also
in connection with the Kroll acquisition, Fitch Ratings announced that it had
put the Company's long-term senior debt rating on Rating Watch Negative and,
depending on the financing employed, might reduce its rating. Fitch has affirmed
the Company's short-term debt rating at F1. It is currently expected that the
Kroll acquisition will be consummated on July 8, 2004.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows MMC to "incorporate by reference" the information it files
with the SEC. This permits MMC to disclose important information to you by
referencing these filed documents, including MMC's annual, quarterly and current
reports, that are considered part of this prospectus supplement and the
accompanying prospectus. Information that MMC files later with the SEC will
automatically update and supersede this information.
We incorporate by reference the documents set forth below that MMC
previously filed with the SEC and any future filings made with the SEC until the
offering of all the Notes has been completed. These documents contain important
information about MMC and its finances.
SEC FILINGS PERIOD
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Annual Report on Form 10-K ................. Year ended December 31, 2003
Quarterly Report on Form 10-Q .............. Quarter ended March 31, 2004
Current Reports on Form 8-K ................ April 8, May 18 and June 9, 2004
MMC will provide without charge upon written or oral request, a copy of any
or all of the documents which are incorporated by reference to this prospectus
supplement and the accompanying prospectus, other than exhibits which are
specifically incorporated by reference into those documents. Requests should be
directed to Investor Relations, Marsh & McLennan Companies, Inc., 1166 Avenue of
the Americas, New York, New York 10036-2774 (telephone number (212) 345-5000).
The information found on our website and the websites of our operating companies
is not a part of this prospectus supplement or the accompanying prospectus.
S-1
INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS
MMC and its subsidiaries and their representatives may from time to time
make verbal or written statements (including certain statements contained in
this report and other MMC filings with the SEC and in our reports to
stockholders) relating to future results, which are forward-looking statements
as that term is defined in the Private Securities Litigation Reform Act of 1995.
Such statements may include, without limitation, discussions concerning
revenues, expenses, earnings, cash flow, capital structure, pension funding, and
the adverse consequences arising from market-timing issues at Putnam, including
fines and restitution, as well as market and industry conditions, premium rates,
financial markets, interest rates, foreign exchange rates, contingencies, and
matters relating to MMC's operations and income taxes. Such forward-looking
statements are based on available current market and industry materials,
experts' reports and opinions, and long-term trends, as well as management's
expectations concerning future events impacting MMC. Forward-looking statements
by their very nature involve risks and uncertainties. Factors that may cause
actual results to differ materially from those contemplated by any
forward-looking statements contained or incorporated or referred to herein
include, in the case of MMC's risk and insurance services business, changes in
competitive conditions, movements in premium rate levels, the conditions for the
transfer of commercial risk and other changes in the global property and
casualty insurance markets, natural catastrophes, mergers between client
organizations, and insurance or reinsurance company insolvencies. Factors to be
considered in the case of MMC's investment management business include changes
in worldwide and national equity and fixed income markets, actual and relative
investment performance, the level of sales and redemptions, and the ability to
maintain investment management and administrative fees at historic levels; and
with respect to all of MMC's activities, changes in general worldwide and
national economic conditions, the impact of terrorist attacks, changes in the
value of investments made in individual companies and investment funds,
fluctuations in foreign currencies, actions of competitors or regulators,
changes in interest rates or in the ability to access financial markets,
developments relating to claims, lawsuits and contingencies, prospective and
retrospective changes in the tax or accounting treatment of MMC's operations,
and the impact of tax and other legislation and regulation in the jurisdictions
in which MMC operates. In addition, there are risks and uncertainties relating
to MMC's ability to integrate Kroll's business successfully and realize expected
synergies; the continued strength of Kroll's relationships with its employees,
suppliers, and customers; and the accuracy of the basis for the forecasts
relating to Kroll's business. Forward-looking statements speak only as of the
date on which they are made, and MMC undertakes no obligation to update any
forward-looking statement to reflect events or circumstances after the date on
which it is made or to reflect the occurrence of unanticipated events.
MMC is committed to providing timely and materially accurate information to
the investing public, consistent with our legal and regulatory obligations. To
that end, MMC and its operating companies use their websites to convey
meaningful information about their businesses, including the anticipated release
of quarterly financial results and the posting of updates of assets under
management at Putnam. Monthly updates of total assets under management at Putnam
will be posted to the MMC website the first business day following the end of
each month. Putnam posts mutual fund and performance data to its website
regularly. Assets for most Putnam retail mutual funds are posted approximately
two weeks after each month-end. Mutual fund net asset value (NAV) is posted
daily. Historical performance and Lipper rankings are also provided. Investors
can link to MMC and its operating company websites through www.mmc.com.
USE OF PROCEEDS
We will receive net proceeds (before expenses) from the offering of the
Notes of approximately $1.14 billion. This reflects a deduction for the
underwriting discounts and commissions. We intend to use these proceeds to repay
a portion of the commercial paper used to fund the Kroll acquisition. Our
commercial paper bears an interest rate of 1.37% and has an average maturity of
31 days.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth our ratio of earnings to fixed charges for
the periods indicated.
THREE MONTHS ENDED
YEAR ENDED DECEMBER 31, MARCH 31,
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2003 2002 2001 2000 1999 2004 2003
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7.8 8.3 6.0 6.3 4.5 9.0 6.7
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DESCRIPTION OF NOTES
The Notes will be senior debt issued under an Indenture to be dated as of
July 14, 2004, as supplemented by the first supplemental indenture, to be dated
as of July 14, 2004, between Marsh & McLennan Companies, Inc. and The Bank of
New York, as trustee (collectively, the "Indenture"). The Fixed Rate Notes and
the Floating Rate Notes offered by this prospectus supplement each are a
separate series of debt securities under the Indenture. As used in this
"Description of Notes" section, the "Company" means Marsh & McLennan Companies,
Inc. and does not include its subsidiaries.
FIXED RATE NOTES
The Fixed Rate Notes will initially be limited to $650,000,000 aggregate
principal amount. The Fixed Rate Notes will bear interest at 5.375% per year.
Interest will be payable semi-annually in arrears on January 15 and July 15 of
each year, beginning January 15, 2005. Interest on the Fixed Rate Notes will
accrue from July 14, 2004, or from the most recent date to which interest has
been paid or provided for. Interest on the Fixed Rate Notes will be paid to
holders of record on the January 1 or July 1 immediately preceding the interest
payment date. The Fixed Rate Notes will mature on July 15, 2014.
OPTIONAL REDEMPTION
The Fixed Rate Notes will be redeemable in whole at any time or in part
from time to time, at our option, at a redemption price equal to the greater of:
o 100% of the principal amount of notes to be redeemed; or
o the sum of the present values of the remaining scheduled payments of
principal and interest on the Notes to be redeemed (exclusive of
interest accrued to the date of redemption) discounted to the date of
redemption on a semiannual basis (assuming a 360-day year consisting
of twelve 30-day months) at the then current Treasury Rate plus 15
basis points.
In each case we will pay accrued and unpaid interest on the principal
amount to be redeemed to the date of redemption.
"Comparable Treasury Issue" means the United States Treasury security
selected by the Independent Investment Banker as having a maturity comparable to
the remaining term ("Remaining Life") of the Notes to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of such Notes.
"Comparable Treasury Price" means, with respect to any redemption date, (1)
the average of the Reference Treasury Dealer Quotations for such redemption
date, after excluding the highest and lowest Reference Treasury Dealer
Quotations, or (2) if the trustee obtains fewer than four such Reference
Treasury Dealer Quotations, the average of all such quotations.
"Independent Investment Banker" means Banc of America Securities LLC and
its successors, or, if such firm or the successors, if any, to such firm, as the
case may be, are unwilling or unable to select the Comparable Treasury Issue, an
independent investment banking institution of national standing appointed by us.
"Reference Treasury Dealer" means Banc of America Securities LLC and its
respective successors, and three other firms that are primary U.S. Government
securities dealers (each a "Primary Treasury Dealer") which we will specify from
time to time; provided, however, that if any of them ceases to be a Primary
Treasury Dealer, we will substitute another Primary Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any redemption date, the average, as determined by
the trustee, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the trustee by such Reference Treasury Dealer at 5:00 p.m., New York
City time, on the third business day preceding such redemption date.
"Treasury Rate" means, with respect to any redemption date, the rate per
year equal to:
(1) the yield, under the heading which represents the average for the
immediately preceding week, appearing in the most recently published statistical
release designed "H.15(519)" or any successor publication which is published
weekly by the Board of Governors of the Federal Reserve System and which
establishes yields on
S-3
actively traded United States Treasury securities adjusted to constant maturity
under the caption "Treasury Constant Maturities," for the maturity corresponding
to the Comparable Treasury Issue; provided that, if no maturity is within three
months before or after the Remaining Life of the Notes to be redeemed, yields
for the two published maturities most closely corresponding to the Comparable
Treasury Issue shall be determined and the Treasury Rate shall be interpolated
or extrapolated from those yields on a straight line basis, rounding to the
nearest month; or
(2) if such release (or any successor release) is not published during the
week preceding the calculation date or does not contain such yields, the rate
per year equal to the semiannual equivalent yield to maturity of the Comparable
Treasury Issue, calculated using a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such redemption date.
The Treasury Rate shall be calculated on the third business day preceding
the redemption date. As used in the immediately preceding sentence and in the
definition of "Reference Treasury Dealer Quotations" above, the term "business
day" means any day that is not a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to remain
closed.
Notice of any redemption will be mailed at least 30 but not more than 60
days before the redemption date to each holder of record of the Notes to be
redeemed at its registered address. The notice of redemption for the Notes will
state, among other things, the amount of Notes to be redeemed, the redemption
date, the manner in which the redemption price will be calculated and the place
or places that payment will be made upon presentation and surrender of Notes to
be redeemed. If less than all of the Notes are to be redeemed at our option, the
trustee will select, in a manner it deems fair and appropriate, the Notes, or
portions of the Notes, to be redeemed. Unless we default in the payment of the
redemption price, interest will cease to accrue on any Notes that have been
called for redemption at the redemption date.
The Company shall not be required (i) to issue, register the transfer of or
exchange any Notes during a period beginning at the opening of business 15 days
before the day of the mailing of a notice of redemption of Notes selected for
redemption and ending at the close of business on the day of such mailing, or
(ii) to register the transfer of or exchange any Notes so selected for
redemption in whole or in part, except the unredeemed portion of any such Notes
being redeemed in part.
FLOATING RATE NOTES
The Floating Rate Notes will initially be limited to $500,000,000 aggregate
principal amount. The Floating Rate Notes will bear interest at "LIBOR" plus
0.14%. Interest will accrue from July 14, 2004 and is payable quarterly in
arrears on January 13, April 13, July 13 and October 13 of each year, beginning
on October 13, 2004; provided that if any such date is not a business day,
payment of interest accrued through the applicable interest payment date will be
made on the following business day unless that business day is in the following
calendar month, in which case the interest payment date will be the immediately
preceding business day. The interest rate will be calculated quarterly on
January 11, April 11, July 11 and October 11 and will be reset quarterly on
January 13, April 13, July 13 and October 13 (each of these dates is called an
"Interest Reset Date"). Interest is payable from the date of issue of the
Floating Rate Notes or from the most recent date to which interest on such
Floating Rate Note has been paid or duly provided for, until the principal
amount of the Floating Rate Note is paid or duly made available for payment. We
will pay interest to the holders of record at the close of business 15 calendar
days before the interest payment date. The Floating Rate Notes will mature on
July 13, 2007.
"LIBOR" for each Interest Reset Date, other than for the initial interest
rate, will be determined by the calculation agent as follows:
(i) LIBOR will be the offered rate for deposits in U.S. dollars for the
three month period which appears on "Telerate Page 3750" at
approximately 11:00 a.m., London time, two "London banking days" prior
to the applicable Interest Reset Date.
(ii) If this rate does not appear on the Telerate Page 3750, the
calculation agent will determine the rate on the basis of the rates at
which deposits in U.S. dollars are offered by four major banks in the
London interbank market (selected by the calculation agent after
consulting with us) at approximately 11:00 a.m., London time, two
London banking days prior to the applicable Interest Reset Date to
prime banks in the London interbank market for a period of three
months commencing on that Interest Reset Date and in principal amount
equal to an amount not less than $1,000,000 that is representative for
a single transaction in such market at such time. In such case, the
calculation agent will request the principal
S-4
London office of each of the aforesaid major banks to provide a
quotation of such rate. If at least two such quotations are provided,
LIBOR for that Interest Reset Date will be the average of the
quotations. If fewer than two quotations are provided as requested,
LIBOR for that Interest Reset Date will be the average of the rates
quoted by three major banks in New York, New York (selected by the
calculation agent after consulting with us) at approximately 11:00
a.m., New York time, two London banking days prior to the applicable
Interest Reset Date for loans in U.S. dollars to leading banks for a
period of three months commencing on that Interest Reset Date and in a
principal amount equal to an amount not less than $1,000,000 that is
representative for a single transaction in such market at such time;
provided that if fewer than three quotations are provided as
requested, for the period until the next Interest Reset Date, LIBOR
will be the same as the rate determined on the immediately preceding
Interest Reset Date.
The interest rate in effect from the date of issue to the first Interest
Reset Date will be based on three month LIBOR two London banking days prior to
the date of issue.
A "London banking day" is any day in which dealings in U.S. dollar deposits
are transacted in the London interbank market. "Telerate Page 3750" means the
display page so designated on the Telerate Service for the purpose of displaying
London interbank offered rates of major banks (or any successor page).
The calculation agent will, upon the request of the holder of any Floating
Rate Note, provide the interest rate then in effect. The calculation agent is
The Bank of New York until such time as we appoint a successor calculation
agent. All calculations made by the calculation agent in the absence of willful
misconduct, bad faith or manifest error shall be conclusive for all purposes and
binding on us and the holders of the Floating Rate Notes. We may appoint a
successor calculation agent at any time at our discretion and without notice.
All percentages resulting from any calculation of the interest rate with
respect to the Floating Rate Notes will be rounded, if necessary, to the nearest
one-hundred thousandth of a percentage point, with five one-millionths of a
percentage point rounded upward (e.g., 9.876545% (or .09876545) would be rounded
to 9.87655% (or .0987655) and 9.876544% (or .09876544) would be rounded to
9.87654% (or .0987654)), and all dollar amounts in or resulting from any such
calculation will be rounded to the nearest cent (with one-half cent being
rounded upward).
Interest on the Floating Rate Notes will be computed and paid on the basis
of a 360-day year and the actual number of days in each interest payment period.
The interest rate on the Floating Rate Notes will in no event be higher than the
maximum rate permitted by New York law, as the same may be modified by United
Sates law of general application.
GENERAL TERMS OF NOTES
We may, without the consent of the noteholders, issue additional notes
having the same ranking and the same interest rate, maturity and other terms as
the Notes offered by this prospectus supplement. Any such additional notes will
be a part of the series having the same terms as the Notes.
Interest and principal will be payable in U.S. dollars. The Notes will be
issued only in denominations of $2,000 and integral multiples of $2,000. There
will be no sinking fund payments for the Notes.
The security registrar and transfer agent for the Notes will be The Bank of
New York until such time as a successor security registrar or transfer agent is
appointed.
RANKING
The Notes will be senior unsecured obligations of Marsh & McLennan
Companies, Inc. and will rank equally with all of our other senior unsecured
indebtedness from time to time outstanding. On a pro forma basis as of March 31,
2004, after giving effect to the offering of the Notes, we would have $4,972
million of outstanding senior indebtedness, of which $200 million would have
been secured indebtedness, not including the debt of our subsidiaries. Also on a
pro forma basis as of March 31, 2004, after giving effect to the offering of the
Notes, debt of our subsidiaries, to which the Notes will be structurally
subordinated, was approximately $130 million.
COVENANTS WITH RESPECT TO THE NOTES
LIMITATION ON LIENS ON STOCK OF OUR SIGNIFICANT SUBSIDIARIES. The indenture
prohibits us and our subsidiaries from directly or indirectly creating,
assuming, incurring or permitting to exist any Indebtedness secured by any lien
on the voting stock of Marsh Inc., Putnam Investments or Mercer Inc. (each a
"Significant Subsidiary")
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unless the Notes (and, if we so elect, any other Indebtedness of MMC that is not
subordinate to the Notes and with respect to which the governing instruments
require, or pursuant to which we are otherwise obligated, to provide such
security) are secured equally and ratably with such Indebtedness for at least
the time period such Indebtedness is so secured. "Indebtedness" is defined as
the principal of and any premium and interest due on indebtedness of a Person,
whether outstanding on the original date of issuance of the Notes or thereafter
created, incurred or assumed, which is (a) indebtedness for money borrowed and
(b) any amendments, renewals, extensions, modifications and refundings of any
such indebtedness. For the purposes of this definition, "indebtedness for money
borrowed" means (1) any obligation of, or any obligation guaranteed by, such
Person for the repayment of borrowed money, whether or not evidenced by bonds,
debentures, notes or other written instruments, (2) any obligation of, or any
obligation guaranteed by, such Person evidenced by bonds, debentures, notes or
similar written instruments, including obligations assumed or incurred in
connection with the acquisition of property, assets or businesses (provided,
however, that the deferred purchase price of any business or property or assets
shall not be considered Indebtedness if the purchase price thereof is payable in
full within 90 days from the date on which such indebtedness was created), and
(3) any obligations of such Person as lessee under leases required to be
capitalized on the balance sheet of the lessee under generally accepted
accounting principles and leases of property or assets made as part of any sale
and lease-back transaction to which such Person is a party. For purposes of this
covenant only, Indebtedness also includes any obligation of, or any obligation
guaranteed by, any Person for the payment of amounts due under a swap agreement
or similar instrument or agreement, or under a foreign currency hedge exchange
or similar instrument or agreement.
CONSOLIDATION, MERGER AND SALE OF ASSETS. We may, without the consent of
the holders of the outstanding Notes, consolidate with or merge into, or convey,
transfer or lease all or substantially all of our properties and assets to, any
Person or may permit any Person to consolidate with or merge into the Company,
provided that any successor Person must be a corporation, partnership or trust
organized and validly existing under the laws of any domestic jurisdiction and
must assume our obligations on the Notes and under the Indenture, that after
giving effect to the 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
happened and be continuing and that certain other conditions are met.
GLOBAL CLEARANCE AND SETTLEMENT PROCEDURES
Investors in the global securities representing any of the Notes (the
"Global Notes") may hold a beneficial interest in such Global Notes through The
Depository Trust Company ("DTC"), Clearstream Banking, societe anonyme
("Clearstream") or the Euroclear System ("Euroclear") or through participants.
The Notes may be traded as home market instruments in both the European and U.S.
domestic markets. Initial settlement and all secondary trades will settle as set
forth below.
Clearstream has advised that it is incorporated under the laws of the Grand
Duchy of Luxembourg as a professional depositary. Clearstream holds securities
for its participating organizations ("Clearstream Participants"). Clearstream
facilitates the clearance and settlement of securities transactions between
Clearstream Participants through electronic book-entry changes in accounts of
Clearstream Participants, eliminating the need for physical movement of
certificates. Clearstream provides to Clearstream Participants, among other
things, services for safekeeping, administration, clearance and settlement of
internationally traded securities and securities lending and borrowing.
Clearstream interfaces with domestic markets in several countries. As a
professional depositary, Clearstream is subject to regulation by the Luxembourg
Commission for the Supervision of the Financial Sector (CSSF). Clearstream
Participants are recognized financial institutions around the world, including
underwriters, securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations. Indirect access to Clearstream is
also available to others, such as banks, brokers, dealers and trust companies
that clear through or maintain a custodial relationship with a Clearstream
Participant, either directly or indirectly.
Distributions, to the extent received by the U.S. Depositary (as defined
below) for Clearstream, with respect to the Notes held beneficially through
Clearstream will be credited to cash accounts of Clearstream Participants in
accordance with its rules and procedures.
Euroclear has advised that it was created in 1968 to hold securities for
its participants ("Euroclear Participants") and to clear and settle transactions
between Euroclear Participants through simultaneous electronic book-entry
delivery against payment, eliminating the need for physical movement of
certificates and eliminating any risk from lack of simultaneous transfers of
securities and cash. Euroclear provides various other services, including
securities lending and borrowing and interfaces with domestic markets in several
countries. Euroclear is
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operated by Euroclear Bank S.A./ N.V. (the "Euroclear Operator"), under contract
with Euroclear Clearance Systems S.C., a Belgian cooperative corporation (the
"Cooperative"). All operations are conducted by the Euroclear Operator, and all
Euroclear securities clearance accounts and Euroclear cash accounts are accounts
with the Euroclear Operator not the Cooperative. The Cooperative establishes
policy for Euroclear on behalf of Euroclear Participants. Euroclear Participants
include banks (including central banks), securities brokers and dealers and
other professional financial intermediaries and may include the underwriters.
Indirect access to Euroclear is also available to other firms that clear through
or maintain a custodial relationship with a Euroclear Participant, either
directly or indirectly.
The Euroclear Operator has advised us that it is licensed by the Belgian
Banking and Finance Commission to carry out banking activities on a global
basis. As a Belgian bank, it is regulated and examined by the Belgian Banking
Commission.
Securities clearance accounts and cash accounts with the Euroclear Operator
are governed by the Terms and Conditions Governing Use of Euroclear and the
related Operating Procedures of the Euroclear System, and applicable Belgian law
(collectively, the "Terms and Conditions"). The Terms and Conditions govern
transfers of securities and cash within Euroclear, withdrawals of securities and
cash from Euroclear, and receipts of payments with respect to securities in
Euroclear. All securities in Euroclear are held on a fungible basis without
attribution of specific certificates to specific securities clearance accounts.
The Euroclear Operator acts under the Terms and Conditions only on behalf of
Euroclear Participants and has no record of or relationship with persons holding
through Euroclear Participants.
Distributions, to the extent received by the U.S. Depositary for Euroclear,
with respect to Notes held beneficially through Euroclear will be credited to
the cash accounts of Euroclear Participants in accordance with the Terms and
Conditions.
Individual certificates in respect of Notes will not be issued in exchange
for the Global Notes, except in very limited circumstances. If DTC notifies us
that it is unwilling or unable to continue as a clearing system in connection
with a Global Note or DTC ceases to be a clearing agency registered under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in each
case we do not appoint a successor clearing system within 90 days after
receiving such notice from Euroclear, Clearstream or DTC or on becoming aware
that DTC is no longer so registered, we will issue or cause to be issued
individual certificates in registered form on registration of transfer of or in
exchange for book-entry interests in the Notes represented by such Global Note
upon delivery of such Global Note for cancellation.
Title to book-entry interests in the Notes will pass by book-entry
registration of the transfer within the records of Euroclear, Clearstream or
DTC, as the case may be, in accordance with their respective procedures.
Book-entry interests in the Notes may be transferred within Euroclear and within
Clearstream and between Euroclear and Clearstream in accordance with procedures
established for these purposes by Euroclear and Clearstream. Book-entry
interests in the Notes may be transferred within DTC in accordance with
procedures established for this purpose by DTC. Transfers of book-entry
interests in the Notes between Euroclear and Clearstream and DTC may be effected
in accordance with procedures established for this purpose by Euroclear,
Clearstream and DTC.
INITIAL SETTLEMENT
All Global Notes will be registered in the name of Cede & Co. as nominee of
DTC. Investors' interests in the Global Notes will be represented through
financial institutions acting on their behalf as direct and indirect
participants in DTC. As a result, Clearstream and Euroclear will hold positions
on behalf of their participants through their respective depositaries (each, a
"U.S. Depositary"), Citibank, N.A. ("Citibank") and JPMorgan Chase Bank
("JPMorgan Chase"), which in turn will hold such positions in accounts as
participants of DTC.
Notes held through DTC will be settled in immediately available funds.
Investor securities custody accounts will be credited with their holdings
against payment on the settlement date. Notes held through Clearstream or
Euroclear accounts will follow the settlement procedures applicable to
conventional eurobonds, except that there will be no temporary global security
and no "lock-up" or restricted period. Notes will be credited to the securities
custody accounts on the settlement date against payment.
S-7
SECONDARY MARKET TRADING
Since the purchaser determines the place of delivery, it is important to
establish at the time of the trade where both the purchaser's and seller's
accounts are located to ensure that settlement can be made on the desired value
date.
TRADING BETWEEN DTC PARTICIPANTS. Secondary market trading between DTC
participants will be settled in immediately available funds.
TRADING BETWEEN CLEARSTREAM AND/OR EUROCLEAR PARTICIPANTS. Secondary market
trading between Clearstream participants and/or Euroclear participants will be
settled using the procedures applicable to conventional eurobonds.
TRADING BETWEEN DTC SELLER AND CLEARSTREAM OR EUROCLEAR PURCHASER. When
beneficial interests in the Global Notes are to be transferred from the account
of a DTC participant to the account of a Clearstream participant or a Euroclear
participant, the purchaser will send instructions to Clearstream or Euroclear
through a participant at least one business day prior to settlement. Clearstream
or Euroclear will instruct Citibank or JPMorgan Chase, as the case may be, to
receive a beneficial interest in the Global Notes against payment. Unless
otherwise set forth in this prospectus supplement, payment will include interest
accrued on the beneficial interest in the Global Notes so transferred from and
including the last interest payment date to and excluding the settlement date,
on the basis on which interest is calculated on the Notes. For transactions
settling on the 31st of the month, payment will include interest accrued to and
excluding the first day of the following month. Payment will then be made by
Citibank or JPMorgan Chase to the DTC participant's account against delivery of
the beneficial interest in the Global Notes. After settlement has been
completed, the beneficial interest in the Global Notes will be credited to the
respective clearing system and by the clearing system, in accordance with its
usual procedures, to the Clearstream or Euroclear participant's account. The
securities credit will appear the next day (European time) and the cash debit
will be back-valued to, and interest on the beneficial interest in the Global
Notes will accrue from, the value date (which would be the preceding day when
settlement occurred in New York). If settlement is not completed on the intended
value date (that is, the trade fails), the Clearstream or Euroclear cash debit
will be valued instead as of the actual settlement date.
Clearstream participants and Euroclear participants will need to make
available to the respective clearing systems the funds necessary to process
same-day funds settlement. The most direct means of doing so is to preposition
funds for settlement, either from cash on hand or existing lines of credit, as
they would for any settlement occurring within Clearstream or Euroclear. Under
this approach, they may take on credit exposure to Clearstream or Euroclear
until the beneficial interests in the Global Notes are credited to their
accounts one day later.
As an alternative, if Clearstream or Euroclear has extended a line of
credit to them, participants can elect not to preposition funds and allow that
credit line to be drawn upon to finance settlement. Under this procedure,
Clearstream participants or Euroclear participants purchasing a beneficial
interest in the Global Notes would incur overdraft charges for one day, assuming
they cleared the overdraft when the beneficial interests in the Global Notes
were credited to their accounts. However, interest on the beneficial interests
in the Global Notes would accrue from the value date. Therefore, in many cases
the investment income on the Global Notes earned during that one-day period may
substantially reduce or offset the amount of such overdraft charges, although
this result will depend on each participant's particular cost of funds.
Since the settlement is taking place during New York business hours, DTC
participants can employ their usual procedures for sending a beneficial interest
in the Global Notes to Citibank or JPMorgan Chase for the benefit of Clearstream
participants or Euroclear participants. The sale proceeds will be available to
the DTC seller on the settlement date. Thus, to the DTC participant a
cross-market transaction will settle no differently than a trade between two DTC
participants.
TRADING BETWEEN CLEARSTREAM OR EUROCLEAR SELLER AND DTC PURCHASER. Due to
time zone differences in their favor, Clearstream and Euroclear participants may
employ their customary procedures in transactions in which a beneficial interest
in the Global Notes is to be transferred by the respective clearing system,
through Citibank or JPMorgan Chase, to a DTC participant. The seller will send
instructions to Clearstream or Euroclear through a participant at least one
business day prior to settlement. In these cases, Clearstream or Euroclear will
instruct Citibank or JPMorgan Chase, as appropriate, to deliver the beneficial
interest in the Global Notes to the DTC participant's account against payment.
Payment will include interest accrued on the beneficial interest in the
S-8
Global Notes from and including the last coupon payment date to and excluding
the settlement date on the basis on which interest is calculated on the Global
Notes. For transactions settling on the 31st of the month, payment will include
interest accrued to and excluding the first day of the following month. The
payment will then be reflected in the account of the Clearstream or Euroclear
participant the following day, and receipt of the cash proceeds in the
Clearstream or Euroclear participant's account would be back-valued to the value
date (which would be the preceding day, when settlement occurred in New York).
Should the Clearstream or Euroclear participant have a line of credit with its
respective clearing system and elect to be in debit in anticipation of receipt
of the sale proceeds in its account, the back-valuation will extinguish any
overdraft charges incurred over that one-day period. If settlement is not
completed on the intended value date (that is, the trade fails), receipt of the
cash proceeds in the Clearstream or Euroclear participant's account would
instead be valued as of the actual settlement date.
Finally, day traders that use Clearstream or Euroclear and that purchase
beneficial interests in the Global Notes from DTC participants for credit to
Clearstream participants or Euroclear participants should note that these trades
would automatically fail on the sale side unless affirmative action is taken. At
least three techniques should be readily available to eliminate this potential
problem:
(1) borrowing through Clearstream or Euroclear for one day (until the
purchase side of the day trade is reflected in their Clearstream or
Euroclear accounts) in accordance with the clearing system's customary
procedures;
(2) borrowing beneficial interests in the Global Notes in the United
States from a DTC participant no later than one day prior to
settlement, which would give beneficial interests in the Global Notes
sufficient time to be reflected in the appropriate Clearstream or
Euroclear account in order to settle the sale side of the trade; or
(3) staggering the value dates for the buy and sell sides of the trade so
that the value date for the purchase from the DTC participant is at
least one day prior to the value date for the sale to the Clearstream
participant or Euroclear participant.
Although DTC, Clearstream, and Euroclear have agreed to the foregoing
procedures in order to facilitate transfers of beneficial interests in the
Global Notes among participants of DTC, Clearstream, and Euroclear, they are
under no obligation to perform or continue to perform such procedures and such
procedures may be discontinued at any time.
APPLICABLE LAW
The Notes and the Indenture will be governed by and construed in accordance
with the laws of the State of New York.
ADDITIONAL TERMS
For additional important information about the Notes, see "Description of
Debt Securities" in the accompanying prospectus. That information includes:
o additional information on the terms of the Notes;
o general information on the Indenture and the trustee;
o a description of events of default under the indenture.
To the extent any information about the Notes varies between this
prospectus supplement and the accompanying prospectus, you should rely on the
information contained in this prospectus supplement.
S-9
UNDERWRITING
Banc of America Securities LLC is acting as global coordinator and, along
with Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman,
Sachs & Co., J.P. Morgan Securities Inc., Merrill, Lynch, Pierce, Fenner & Smith
Incorporated, as joint book-running managers of the offering.
Subject to the terms and conditions contained in the underwriting agreement
dated the date of this prospectus supplement, each underwriter named below has
severally agreed to purchase, and we have agreed to sell to that underwriter,
the principal amount of Notes set forth opposite the underwriter's name.
PRINCIPAL AMOUNT OF
UNDERWRITER FIXED RATE NOTES
----------- -------------------
Banc of America Securities LLC $162,500,000
Citigroup Global Markets Inc. .......................... 162,500,000
Deutsche Bank Securities Inc. .......................... 162,500,000
Goldman, Sachs & Co. ................................... 162,500,000
------------
Total ................................................ $650,000,000
============
PRINCIPAL AMOUNT OF
UNDERWRITER FLOATING RATE NOTES
----------- --------------------
Banc of America Securities LLC ......................... $166,668,000
J.P. Morgan Securities Inc. ............................ 166,666,000
Merrill, Lynch, Pierce, Fenner & Smith
Incorporated ................................ 166,666,000
------------
Total ................................................ $500,000,000
============
The underwriting agreement provides that the obligations of the
underwriters to pay for and accept delivery of the Notes offered hereby are
subject to approval of legal matters by counsel and to other conditions. The
underwriters are obligated to purchase all the Notes offered hereby if they
purchase any of the Notes.
The underwriters propose to offer some of the Notes directly to the public
at the public offering price set forth on the cover page of this prospectus
supplement and some of the Notes to dealers at the public offering price less a
concession not to exceed 0.275% of the principal amount of the Fixed Rate Notes
and 0.125% of the principal amount of the Floating Rate Notes. The underwriters
may allow, and dealers may reallow, a concession not to exceed 0.200% of the
principal amount of the Fixed Rate Notes and 0.100% of the principal amount of
the Floating Rate Notes on sales to other dealers. After the initial offering of
the Notes to the public, the representatives may change the public offering
price and concessions.
We estimate that our total expenses for this offering will be $800,000.
We have agreed to indemnify the underwriters against certain liabilities,
including liabilities under the Securities Act of 1933, as amended, or to
contribute to payments the underwriters may be required to make because of any
of those liabilities.
The Notes are a new issue of securities with no established trading market.
We do not intend to list the Notes on any securities exchange. If a trading
market does not develop or is not maintained, holders of Notes may find it
difficult or impossible to resell their Notes. If a trading market were to
develop, the Notes may trade at prices that are higher or lower than their
initial offering price, depending on many factors, including prevailing interest
rates, our operating results and financial condition, and the market for similar
securities. We have been advised by the underwriters that they intend to make a
market in the Notes. However, the underwriters are not obligated to do so and
may discontinue any market making at any time without notice. Accordingly, there
can be no assurance regarding any future development of a trading market for the
Notes or the ability of holders of the Notes to sell their Notes at all or at
the price at which such holders may be able to sell their Notes.
The following table shows the underwriting discounts and commissions that
we are to pay to the underwriters in connection with this offering (expressed as
a percentage of the principal amount of the Notes).
Per Fixed Rate Note .......................... 0.450%
Per Floating Rate Note ....................... 0.225%
In connection with the offering, the underwriters may purchase and sell
Notes in the open market. These transactions may include overallotment,
syndicate covering transactions and stabilizing transactions.
S-10
Overallotment involves syndicate sales of Notes in excess of the principal
amount of Notes to be purchased by the underwriters in the offering, which
creates a syndicate short position. Syndicate covering transactions involve
purchases of the Notes in the open market after the distribution has been
completed in order to cover syndicate short positions. Stabilizing transactions
consist of certain bids or purchases of Notes made for the purpose of preventing
or retarding a decline in the market price of the Notes while the offering is in
progress.
The underwriters also may impose a penalty bid. Penalty bids permit the
underwriters to reclaim a selling concession from a syndicate member when the
underwriters, in covering syndicate short positions or making stabilizing
purchases, repurchase Notes originally sold by that syndicate member.
Any of these activities may have the effect of preventing or retarding a
decline in the market price of the Notes. They may also cause the price of the
Notes to be higher than the price that otherwise would exist in the open market
in the absence of these transactions. The underwriters may conduct these
transactions in the over-the-counter market or otherwise. If the underwriters
commence any of these transactions, they may discontinue them at any time
without notice.
Certain of the underwriters may make the Notes available for distribution
on the Internet through a proprietary Web site and/or a third-party system
operated by MarketAxess Corp., an Internet-based communications technology
provider. MarketAxess Corp. is providing the system as a conduit for
communications between the underwriters and their customers and is not a party
to any transactions. MarketAxess Corp., a registered broker-dealer, will receive
compensation from the underwriters based on transactions the underwriters
conduct through the system. The underwriters will make the Notes available to
their customers through the Internet distributions, whether made through a
proprietary or third-party system, on the same terms as distributions made
through other channels.
We expect to deliver the Notes against payment for the Notes on or about
the date specified in the last paragraph of the cover page of this prospectus
supplement, which will be the fifth business day following the date of the
pricing of the Notes. Under Rule 15c6-1 under the Exchange Act, trades in the
secondary market generally are required to settle in three business days, unless
the parties to a trade expressly agree otherwise. Accordingly, purchasers who
wish to trade Notes on the date of pricing or the next succeeding business day
will be required, by virtue of the fact that the Notes initially will settle in
T+5, to specify alternative settlement arrangements to prevent a failed
settlement.
Certain of the underwriters have performed investment banking and advisory
services for us from time to time for which they have received customary fees
and expenses. In addition, the underwriters and certain of their affiliates may,
from time to time, engage in transactions with and perform services for us in
the ordinary course of business for which they will receive customary fees and
expenses.
LEGAL MATTERS
The validity of the Notes and certain matters pertaining to the Notes will
be passed upon for MMC by William L. Rosoff, Esq., general counsel to MMC, and
for the underwriters by Davis Polk & Wardwell, New York, New York.
EXPERTS
The consolidated balance sheets of MMC and its subsidiaries as of December
31, 2003 and 2002, and the related consolidated statements of income,
stockholders' equity and comprehensive income, and cash flows for each of the
years in the three year period ended December 31, 2003, included and
incorporated by reference in MMC's Annual Report on Form 10-K for the year ended
December 31, 2003 and incorporated by reference into this prospectus supplement
and the accompanying prospectus, have been audited by Deloitte & Touche LLP, an
independent registered public accounting firm, as stated in their reports (which
express an unqualified opinion and include an explanatory paragraph relating to
the adoption of Statement of Financial Accounting Standards No. 142, Goodwill
and Other Intangible Assets), which are incorporated herein by reference, and
have been so incorporated in reliance upon the reports of such firm given upon
their authority as experts in accounting and auditing.
S-11
PROSPECTUS
$3,000,000,000
MARSH & MCLENNAN COMPANIES, INC.
COMMON STOCK, PREFERRED STOCK AND DEBT SECURITIES
------------
Marsh & McLennan Companies, Inc. may sell
o common stock to the public.
o preferred stock to the public.
o debt securities to the public.
MMC URGES YOU TO READ THIS PROSPECTUS AND THE ACCOMPANYING PROSPECTUS
SUPPLEMENT, WHICH WILL DESCRIBE THE SPECIFIC TERMS OF THE COMMON STOCK, THE
PREFERRED STOCK AND THE DEBT SECURITIES, CAREFULLY BEFORE YOU MAKE YOUR
INVESTMENT DECISION.
------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES, OR DETERMINED IF
THIS PROSPECTUS OR THE ACCOMPANYING PROSPECTUS SUPPLEMENT IS TRUTHFUL OR
COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THIS PROSPECTUS MAY NOT BE USED TO SELL SECURITIES UNLESS
ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
THE DATE OF THIS PROSPECTUS IS SEPTEMBER 16, 2003
TABLE OF CONTENTS
PAGE
----
About This Prospectus ..................................................... 3
Marsh & McLennan Companies, Inc. .......................................... 3
Use of Proceeds ........................................................... 3
Ratio of Earnings to Fixed Charges ........................................ 3
Description of Securities ................................................. 4
Description of Capital Stock .............................................. 4
Description of Debt Securities ............................................ 9
Plan of Distribution ...................................................... 12
Where You Can Find More Information ....................................... 13
Information Concerning Forward-Looking Statements ......................... 14
Legal Opinions ............................................................ 15
Experts ................................................................... 15
2
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
SEC utilizing a "shelf" registration process. Under this shelf process, we may
sell any combination of the securities described in this prospectus in one or
more offerings up to a total dollar amount of $3,000,000,000. This prospectus
provides you with a general description of the securities we may offer. Each
time we sell securities, we will provide a prospectus supplement that will
contain specific information about the terms of that offering. The prospectus
supplement may also add, update or change information contained in this
prospectus. You should read both this prospectus and any prospectus supplement
together with additional information described under the heading "Where You Can
Find More Information."
You should rely only on the information contained in or incorporated by
reference in this prospectus. We have not authorized anyone to provide you with
different information. We are not making an offer of these securities in any
state where the offer is not permitted. You should not assume that the
information contained in or incorporated by reference in this prospectus is
accurate as of any date other than the date on the front of this prospectus. The
terms "MMC," "we," "us," and "our" refer to Marsh & McLennan Companies, Inc.
MARSH & MCLENNAN COMPANIES, INC.
MMC is a global professional services firm with annual revenues exceeding
$10 billion. It is the parent company of Marsh, Inc., the world's leading risk
and insurance services firm; Putnam Investments, one of the largest investment
management companies in the United States; and Mercer Inc., a major global
provider of consulting services. Approximately 60,000 employees provide
analysis, advice and transactional capabilities to clients in over 100
countries.
Our principal offices are located at 1166 Avenue of the Americas, New York,
New York 10036, and our telephone number is (212) 345-5000. We maintain a
website at http://www.mmc.com, where general information about us is available.
We are not incorporating the contents of our website into this prospectus.
USE OF PROCEEDS
Unless otherwise indicated in a prospectus supplement, the net proceeds
from the sale of the securities will be used for general corporate purposes,
including working capital, acquisitions, retirement of debt and other business
opportunities.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth our ratio of earnings to fixed charges for
the periods indicated.
SIX MONTHS ENDED
YEAR ENDED DECEMBER 31, JUNE 30,
--------------------------------------------------------------- --------------------
2002 2001 2000 1999 1998 2003 2002
---- ---- ---- ---- ---- ---- ----
8.2 6.0 6.3 4.5 6.4 8.6 9.9
3
DESCRIPTION OF SECURITIES
This prospectus contains a summary of the common stock, preferred stock and
debt securities that MMC may sell. These summaries are not meant to be a
complete description of each security. However, this prospectus and the
accompanying prospectus supplement contain the material terms of the securities
being offered.
DESCRIPTION OF CAPITAL STOCK
The following description is based upon our restated certificate of
incorporation, our by-laws and applicable provisions of law. We have summarized
certain portions of the restated certificate of incorporation and by-laws below.
The summary is not complete. The restated certificate of incorporation and
by-laws are incorporated by reference into this prospectus in their entirety.
You should read the restated certificate of incorporation and by-laws for the
provisions that are important to you.
MMC's authorized capital stock consists of 1,600,000,000 shares of common
stock and 6,000,000 shares of preferred stock. No shares of preferred stock were
issued or outstanding as of September 5, 2003.
COMMON STOCK
VOTING RIGHTS. Each holder of common stock is entitled to one vote for each
share held on all matters to be voted upon by stockholders.
DIVIDENDS. The holders of common stock, after any preferences of holders of
any preferred stock, are entitled to receive dividends when and if declared by
the board of directors out of legally available funds.
LIQUIDATION AND DISSOLUTION. If MMC is liquidated or dissolved, the holders
of the common stock will be entitled to share in the assets of MMC available for
distribution to stockholders in proportion to the amount of common stock they
own. The amount available for common stockholders is calculated after payment of
liabilities. Holders of any preferred stock will receive their preferential
share of the assets of MMC before the holders of the common stock receive any
assets.
OTHER RIGHTS. Holders of the common stock have no right to:
o convert the stock into any other security;
o have the stock redeemed; or
o purchase additional stock or to maintain their proportionate ownership
interest.
The common stock does not have cumulative voting rights. Holders of shares
of the common stock are not required to make additional capital contributions.
DIRECTORS' LIABILITY
Our restated certificate of incorporation provides that a member of the
board of directors will not be personally liable to MMC or its stockholders for
monetary damages for breaches of their legal duties to MMC or its stockholders
as a director, except for liability:
o for any breach of the director's legal duty to act in the best
interests of MMC and its stockholders;
o for acts or omissions by the director with dishonest intentions or
which involve intentional misconduct or an intentional violation of
the law;
o for declaring dividends or authorizing the purchase or redemption of
shares in violation of Delaware law; or
o for transactions where the director derived an improper personal
benefit.
Our restated certificate of incorporation also allows us to indemnify
directors and officers to the fullest extent authorized by Delaware law.
TRANSFER AGENT AND REGISTRAR
The Bank of New York is transfer agent and registrar for the common stock.
4
STOCKHOLDER RIGHTS PLAN
Under Delaware law, a corporation may create and issue rights entitling the
holders of such rights to purchase from the corporation shares of its capital
stock of any class or classes, unless prohibited by its restated certificate of
incorporation. The price and terms of these shares must be stated in the
restated certificate of incorporation or in a resolution adopted by the board of
directors.
We have entered into an amended and restated stockholder rights agreement.
As with most stockholder rights agreements, the terms of our rights agreement
are complex and not easily summarized, particularly as they relate to the
acquisition of our common stock and to exercisability of the rights. This
summary may not contain all of the information that is important to you.
Accordingly, you should carefully read our rights agreement, which is
incorporated by reference into this prospectus in its entirety.
Our rights agreement provides that each share of our common stock
outstanding will have attached to it the right to purchase one six-hundredth of
a preferred share of MMC. The purchase price per one six-hundredth of a share of
preferred stock is $200, but this amount may be adjusted in some circumstances.
Initially, the rights are attached to outstanding certificates representing
MMC common stock, and no separate certificates representing the rights will be
distributed. The rights will separate from the common stock and be represented
by separate certificates approximately 10 days after someone acquires or
commences a tender or exchange offer for 15% or more of the outstanding common
stock.
After the rights separate from the common stock, certificates representing
the rights will be mailed to record holders of the common stock. Once
distributed, the rights certificates alone will represent the rights.
All shares of common stock issued prior to the date the rights separate
from the common stock will be issued with the rights attached. The rights are
not exercisable until the date the rights separate from the common stock. The
rights will expire on September 29, 2007, unless that date is extended or the
rights are earlier redeemed or exchanged by MMC.
Under our rights agreement, any rights that are or were owned by an
acquiror of more than 15% of our respective outstanding common stock will be
null and void.
If an acquiror obtains or has the right to obtain 15% or more of MMC common
stock, then each right will entitle the holder to receive, upon exercise, a
number of shares of MMC common stock having a value equal to two times the
exercise price of the right. However, rights will not be exercisable until the
time that the rights are no longer redeemable by our board of directors, as
described below.
Also, if an acquiror obtains 15% or more of MMC common stock, and any of
the following occurs:
o MMC merges into another entity and is not the surviving entity;
o an acquiring entity merges into MMC and MMC's common stock is changed
or exchanged; or
o more than 50% of MMC's assets or earning power is sold or transferred,
then each holder of a right will have the right to receive, upon exercise,
common stock of the acquiring company having a value equal to two times the
exercise price of the right.
After an acquiror obtains 15% or more, but less than 50%, of our
outstanding common stock, our board of directors may, at its option, exchange
all or part of the then outstanding and exercisable rights for common shares or
preferred shares. If our board of directors exercises this option, the exchange
ratio is one common share or one six-hundredth of a preferred share per right,
subject to adjustment to reflect any stock split, stock dividend or similar
transaction.
Our board of directors may, at its option, redeem all but not less than all
of the outstanding rights prior to the time that an acquiror obtains 15% or more
of our outstanding common stock. The redemption price is $.01 per right, subject
to adjustment to reflect any stock split, stock dividend or similar transaction.
The right to exercise the rights will terminate when our board of directors
orders the redemption of the rights and the only right of the holders of the
rights at that time will be to receive the redemption price.
Holders of rights will have no rights as stockholders of MMC, including the
right to vote or receive dividends, simply by virtue of holding the rights.
While the distribution of the rights will not be taxable under United States law
to stockholders or to MMC, stockholders may, depending upon the circumstances,
recognize
5
taxable income under United States law in the event that the rights become
exercisable for our common stock (or other consideration) or for common stock of
the acquiring company or in the event of the redemption of the rights as set
forth above.
The rights agreement may be amended by the board of directors without the
approval of the holders of the rights prior to the date that an acquiror obtains
15% or more of our outstanding common stock. However, after that date, the
rights agreement may not be amended in any manner which would adversely affect
the interests of the holders of the rights, excluding the interests of any
acquiror.
The rights may have anti-takeover effects. The rights may cause substantial
dilution to a person or group that attempts to acquire MMC on terms not approved
by our board of directors, except in connection with an offer conditioned on a
substantial number of rights being acquired. The rights should not interfere
with any merger or other business combination approved by our board of directors
since our board of directors may, at its option, redeem all the rights at the
redemption price at any time prior to the time than an acquiror acquires 15% or
more of our common stock. In addition, the rights should not interfere with a
proxy contest.
PROVISIONS OF MMC'S RESTATED CERTIFICATE OF INCORPORATION AND BY-LAWS AND
DELAWARE LAW THAT
MAY HAVE ANTI-TAKEOVER EFFECTS
CLASSIFIED BOARD OF DIRECTORS. Our restated certificate of incorporation
divides the board of directors into three classes. Each class is to consist as
nearly as possible of one-third of the directors. Each director serves for a
term of three years and until his or her successor is elected and qualified. The
number of directors of MMC is fixed from time to time by the board of directors.
REMOVAL OF DIRECTORS BY STOCKHOLDERS. Delaware law provides that members of
a classified board of directors may only be removed for cause by a vote of the
holders of a majority of the outstanding shares entitled to vote on the election
of the directors.
STOCKHOLDER NOMINATION OF DIRECTORS. MMC's restated by-laws provide that a
stockholder must notify MMC in writing of any stockholder nomination of a
director at least ninety days prior to the anniversary date of the immediately
preceding annual meeting of stockholders. Except that if the date for the annual
meeting is not within 30 days before or after such anniversary date, or if the
meeting is a special meeting of stockholders called for the purpose of electing
directors, then notice by a stockholder is timely if received by MMC no more
than fifteen days after the day on which notice of the date of the meeting was
mailed or public disclosure of the date, whichever first occurs.
NO ACTION BY WRITTEN CONSENT. Our restated certificate of incorporation
provides that stockholders of MMC may not act by written consent and may only
act at duly called meetings of stockholders.
10% STOCKHOLDER PROVISION. Article Eighth of our restated certificate of
incorporation changes the voting requirements for stockholders to approve some
transactions involving a 10% stockholder. Business combinations are an example
of the type of transaction addressed. These transactions must be approved by the
holders of a majority of MMC's outstanding voting power, voting together as a
single class. Any voting stock owned by a 10% stockholder is not counted in the
vote. These transactions, however, can also be approved by a majority of
unbiased directors. In that case the voting requirements of Delaware law, the
restated certificate of incorporation and MMC's by-laws that otherwise apply
would govern the vote. Article Eighth does not affect the voting requirements of
holders of preferred stock, if any, which arise under Delaware law and the
restated certificate of incorporation.
Transactions covered by Article Eighth include:
o mergers of MMC or any of its subsidiaries with a 10% stockholder,
o sales of all or any substantial part of the assets of MMC and its
subsidiaries to a 10% stockholder,
o sales of all or any substantial part of the assets of a 10%
stockholder to MMC,
o the issuance or delivery of securities of MMC or any of its
subsidiaries to a 10% stockholder, or of securities of a 10%
stockholder to MMC,
o any substantial loan, advance or guarantee, pledge or other financial
assistance provided by MMC or any of its subsidiaries to a 10%
stockholder,
6
o the adoption of a plan for the voluntary dissolution or liquidation of
MMC or amendment to MMC's by-laws,
o any reclassification of securities or recapitalization of MMC or other
transaction which increases a 10% stockholder's proportionate share of
any class of MMC's capital stock, or
o any agreement or other arrangement to do any of the foregoing.
A 10% stockholder is described in Article Eighth as an "Interested
Stockholder."
A 10% stockholder is generally considered to be any other corporation,
person or entity which:
o beneficially owns or controls, directly or indirectly, 10% or more of
the voting stock of MMC or has announced a plan or intention to
acquire such securities, or
o is an affiliate or associate of MMC and at any time within two years
prior to the date in question was the beneficial owner of 10% or more
of the voting stock of MMC.
The following are not considered to be 10% stockholders:
o MMC and any of its subsidiaries and
o any profit-sharing, employee stock ownership or other employee benefit
plan of MMC or any subsidiary, or trustees or fiduciaries for these
plans.
An unbiased director is described in Article Eighth as a "Disinterested
Director."
An unbiased director is generally considered to be a director who:
o is not related to a 10% stockholder, and was a member of the board of
directors prior to the time that the relevant 10% stockholder became a
10% stockholder, or
o is a successor to an unbiased director, who is not related to a 10%
stockholder and was nominated by a majority of unbiased directors.
A director is considered related to a 10% stockholder if he is an
affiliate, associate, representative, agent or employee of the 10% stockholder.
Article Eighth may not be changed or repealed without the affirmative vote
of the holders of a majority of MMC's outstanding voting power, voting together
as a single class. Any voting stock owned by a 10% stockholder will not be
counted in the vote. If a majority of unbiased directors recommends a change in
Article Eighth, the standard voting requirements of Delaware law, the restated
certificate of incorporation and MMC's by-laws that otherwise apply will govern
the vote.
DELAWARE BUSINESS COMBINATION STATUTE. Section 203 of the Delaware General
Corporation Law, which we refer to as the DGCL, is applicable to MMC. Section
203 of the DGCL restricts some types of transactions and business combinations
between a corporation and a 15% stockholder. A 15% stockholder is generally
considered by Section 203 to be a person owning 15% or more of the corporation's
outstanding voting stock. Section 203 refers to a 15% stockholder as an
"interested stockholder." Section 203 restricts these transactions for a period
of three years from the date the stockholder acquired 15% or more of MMC's
outstanding voting stock. With some exceptions, unless the transaction is
approved by the board of directors and the holders of at least two-thirds of the
outstanding voting stock of the corporation, Section 203 prohibits significant
business transactions such as:
o a merger with, disposition of significant assets to or receipt of
disproportionate financial benefits by the interested stockholder, and
o any other transaction that would increase the interested stockholder's
proportionate ownership of any class or series of MMC's capital stock.
The shares held by the interested stockholder are not counted as
outstanding when calculating the two-thirds of the outstanding voting stock
needed for approval.
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The prohibition against these transactions does not apply if:
o prior to the time that any stockholder became an interested
stockholder, the board of directors approved either the business
combination or the transaction in which such stockholder acquired 15%
or more of MMC's outstanding voting stock, or
o the interested stockholder owns at least 85% of the outstanding voting
stock of MMC as a result of the transaction in which such stockholder
acquired 15% or more of MMC's outstanding voting stock. Shares held by
persons who are both directors and officers or by some types of
employee stock plans are not counted as outstanding when making this
calculation.
PREFERRED STOCK
GENERAL. MMC is authorized to issue 6,000,000 shares of preferred stock. No
shares of preferred stock are currently issued or outstanding. The board of
directors of MMC may, without stockholder approval, issue shares of preferred
stock. The board of directors can issue more than one series of preferred stock.
The board of directors has the right to fix the number of shares, dividend
rights, conversion rights, voting rights, redemption rights, sinking fund
provisions, liquidation preferences and any other rights, preferences,
privileges and restrictions applicable to the preferred stock it decides to
issue.
VOTING RIGHTS. The DGCL provides that the holders of preferred stock will
have the right to vote separately as a class on any proposal involving
fundamental changes in the rights of holders of such preferred stock.
CONVERSION OR EXCHANGE. The prospectus supplement will describe the terms,
if any, on which the preferred stock may be convertible into or exchangeable for
common stock, debt securities or other preferred stock of MMC. These terms will
include provisions as to whether conversion or exchange is mandatory, at the
option of the holder or at the option of MMC. These provisions may allow or
require the number of shares of common stock or other securities of MMC to be
received by the holders of preferred stock to be adjusted.
STOCKHOLDER RIGHTS PLAN. In connection with MMC's stockholder rights plan
described above, the board of directors has designated 2,000,000 shares of
series A junior participating preferred stock.
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DESCRIPTION OF DEBT SECURITIES
The debt securities will be our direct unsecured general obligations. The
debt securities will be either senior debt securities or subordinated debt
securities. The debt securities will be issued under one or more separate
indentures between us and U.S. Bank National Association (as successor to State
Street Bank and Trust Company), as trustee. Senior debt securities will be
issued under a senior indenture and subordinated debt securities will be issued
under a subordinated indenture. Together the senior indenture and the
subordinated indenture are called indentures.
We have summarized all material provisions of the indentures below. The
forms of the indentures have been filed as exhibits to the registration
statement and you should read the indentures for provisions that may be
important to you. In the summary below, we have included references to section
numbers of the indentures so that you can easily locate these provisions.
GENERAL
The debt securities will be our direct unsecured obligations. The senior
debt securities will rank equally with all of our other senior and
unsubordinated debt. The subordinated debt securities will have a junior
position to all of our senior debt.
Because we are a holding company that conducts all of our operations
through our subsidiaries, holders of the debt securities will have a junior
position to claims of creditors of our subsidiaries, including trade creditors,
debtholders, secured creditors, taxing authorities, guarantee holders and any
preferred stockholders. All of our operating subsidiaries have ongoing corporate
debt programs used to finance their business activities. As of June 30, 2003,
our subsidiaries had approximately $60 million of outstanding debt.
A prospectus supplement relating to any series of debt securities being
offered will include specific terms relating to the offering. The terms will be
established in an officers' certificate or a supplemental indenture. The
officers' certificate or supplemental indenture will be signed at the time of
issuance and will contain important information. The officers' certificate or
supplemental indenture will be filed as an exhibit to a Current Report on Form
8-K of MMC, which will be publicly available. The officers' certificate or
supplemental indenture will include some or all of the following terms for a
particular series of debt securities:
o the title of the securities;
o any limit on the amount that may be issued;
o whether or not the debt securities will be issued in global form and
who the depositary will be;
o the maturity date(s);
o the interest rate or the method of computing the interest rate;
o the date or dates from which interest will accrue, or how such date or
dates will be determined, and the interest payment date or dates and
any related record dates;
o the place(s) where payments will be made;
o MMC's right, if any, to defer payment of interest and the maximum
length of any deferral period;
o the terms and conditions on which the debt securities may be redeemed
at the option of MMC;
o the date(s), if any, on which, and the price(s) at which MMC is
obligated to redeem, or at the holder's option to purchase, such
series of debt securities and other related terms and provisions;
o any provisions granting special rights to holders when a specified
event occurs;
o any changes to or additional events of default or covenants;
o any special tax implications of the debt securities;
o the denominations in which the debt securities will be issued, if
other than denominations of $1,000 and whole multiples of $1,000;
o the subordination terms of any subordinated debt securities; and
o any other terms that are not inconsistent with the indenture.
9
CONVERSION OR EXCHANGE RIGHTS
The prospectus supplement will describe the terms, if any, on which a
series of debt securities may be convertible into or exchangeable for common
stock, preferred stock or other debt securities of MMC. These terms will include
provisions as to whether conversion or exchange is mandatory, at the option of
the holder or at the option of MMC. These provisions may allow or require the
number of shares of common stock or other securities of MMC to be received by
the holders of such series of debt securities to be adjusted. (section 2.01)
COVENANTS
Under the indentures, MMC will:
o pay the interest, principal and any premium on the debt securities
when due (section 4.01); and
o maintain a place of payment (section 4.02).
CONSOLIDATION, MERGER OR SALE
The indentures do not contain any covenant which restricts the ability of
MMC to merge or consolidate, or sell, convey, transfer or otherwise dispose of
all or substantially all of its assets. However, any successor or acquiror of
such assets must assume all of the obligations of MMC under the indentures and
the debt securities. (sections 10.01 and 10.02)
EVENTS OF DEFAULT UNDER THE INDENTURE
The following are events of default under the indentures with respect to
any series of debt securities issued:
o we fail to pay interest when due and continuing for 90 days, unless
the time for payment has been properly extended or deferred in
accordance with the terms of the particular series;
o we fail to pay the principal or any premium when due, unless the
maturity has been properly extended in accordance with the terms of
the particular series;
o we fail to observe or perform any other covenant contained in the debt
securities or the indentures, other than a covenant specifically
relating to another series of debt securities, and such failure
continues for 90 days after we receive notice from the trustee or from
the holders of at least 25% in principal amount of the outstanding
debt securities of that series; and
o certain events of bankruptcy or insolvency, whether voluntary or not.
If an event of default occurs and is continuing, the trustee or the holders
of at least 25% in aggregate principal amount of the outstanding debt securities
of that series may declare the principal of all debt securities of that series
due and payable immediately. (section 6.01)
The holders of a majority in principal amount of the outstanding debt
securities of an affected series may waive any past default with respect to such
series and its consequences, except defaults or events of default regarding
payment of principal, any premium or interest. A waiver will eliminate the
default. (section 6.06)
Unless otherwise specified in the indentures, if an event of default under
an indenture occurs and is continuing, the trustee will be under no obligation
to exercise any of its rights or powers under the indenture unless the holders
of the debt securities have offered the trustee reasonable indemnity. The
holders of a majority in principal amount of the outstanding debt securities of
any series will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the trustee, or exercising
any trust or power conferred on the trustee with respect to the debt securities
of that series, provided that:
o it is not in conflict with any law or the applicable indenture or
unduly prejudicial to the rights of holders of any other series of
debt securities outstanding under the applicable indenture; and
o unless otherwise provided under the Trust Indenture Act, the trustee
need not take any action that might involve it in personal liability.
(sections 6.04 and 6.06)
A holder of the debt securities of any series will only have the right to
institute a proceeding under the indentures or to appoint a receiver or trustee,
or to seek other remedies if:
o the holder has given written notice to the trustee of a continuing
event of default;
10
o the holders of at least 25% in aggregate principal amount of the
outstanding debt securities of that series have made written request
to the trustee to institute proceedings as trustee;
o such holders have offered reasonable indemnity to the trustee to cover
the cost of the proceedings; and
o the trustee does not institute a proceeding, and does not receive
conflicting directions from a majority in principal amount of the
outstanding debt securities of that series, within 60 days.
MMC will periodically file statements with the trustee regarding its
compliance with the covenants in the indentures. (section 5.03)
MODIFICATION OF INDENTURE; WAIVER
MMC and the trustee may change an indenture without the consent of any
holders:
o to fix any ambiguity, defect or inconsistency in the indenture;
o to effect the assumption of a successor corporation of our obligations
under such indenture and the outstanding debt securities;
o to add to our covenants for the benefit of the holders of all or any
series of debt securities under such indenture or surrender any right
or power we have under such indenture;
o to change anything that does not materially adversely affect the
interests of any holder of debt securities of any series; and
o to effect certain other limited purposes described in the indenture.
(section 9.01)
In addition, the rights of holders of a series of debt securities may be
changed by MMC and the trustee with the written consent of the holders of a
majority of the principal amount of the outstanding debt securities of each
series that is affected. However, the following changes may only be made with
the consent of each affected holder:
o extending the fixed maturity;
o reducing the principal amount;
o reducing the rate of or extending the time of payment of interest;
o reducing any premium payable upon redemption; or
o reducing the percentage of debt securities referred to above, the
holders of which are required to consent to any amendment. (section
9.02)
FORM, EXCHANGE, AND TRANSFER
The debt securities of each series will be issued only in fully registered
form without coupons in denominations of $1,000 and whole multiples of $1,000.
The indentures provide that debt securities of a series may be issued in
temporary or permanent global form and may be issued as book-entry securities
that will be deposited with The Depository Trust Company or another depositary
named by MMC and identified in a prospectus supplement with respect to such
series. (sections 2.03, 2.06 and 2.11)
A holder of debt securities of any series can exchange such debt securities
for other debt securities of the same series, in any authorized denomination and
with the same terms and aggregate principal amount.
A holder may present debt securities for exchange or for registration of
transfer at the office of the security registrar or at the office of any
transfer agent designated by MMC for such purpose. Unless otherwise provided in
the debt securities to be transferred or exchanged, no service charge will be
made for any registration of transfer or exchange, but MMC may require payment
of any taxes or other governmental charges. The prospectus supplement will name
the security registrar and any transfer agent initially designated for any
series of debt securities. MMC may at any time change the transfer agent by
written notice delivered to the trustee.
11
If the debt securities of any series are to be redeemed, MMC will not be
required to:
o issue, register the transfer of, or exchange any debt securities of
that series during a period beginning 15 days before the day of
mailing of a notice of redemption and ending at the close of business
on the day of mailing; or
o register the transfer of or exchange any debt securities that have
been called for redemption, except the unredeemed portion of any such
debt securities being redeemed in part. (sections 2.05 and 4.02)
INFORMATION CONCERNING THE TRUSTEE
The trustee, except when there is an event of default, will perform only
those duties as are specifically stated in the indentures. If an event of
default has occurred with respect to any series of debt securities, the trustee
must use with respect to those debt securities the same degree of care as a
prudent person would exercise or use in the conduct of his or her own affairs.
Except as provided in the preceding sentence, the trustee is not required to
exercise any of the powers given it by the indentures at the request of any
holder of debt securities unless it is offered reasonable security or indemnity
against the costs, expenses and liabilities that it might incur. The trustee is
not required to spend or risk its own money or otherwise become financially
liable while performing its duties or exercising its rights or powers unless it
reasonably believes that it will be repaid or receive adequate indemnity.
(sections 7.01 and 7.02)
PAYMENT AND PAYING AGENTS
We will pay interest on any debt securities to the person in whose name the
debt securities are registered on the regular record date for the applicable
interest payment date. (sections 2.03 and 3.03)
We will pay principal, any premium and interest on the debt securities of a
particular series at the office of one or more paying agents that we designate
for that series. Unless otherwise stated in the applicable supplemental
indenture and prospectus supplement, we will initially designate the corporate
trust office of the trustee in the City of New York as our sole paying agent. We
will be required to maintain a paying agent in each place of payment for the
debt securities. (sections 4.01, 4.02 and 4.03)
All money we pay to a paying agent or the trustee for the payment of
principal, any premium or interest on any debt security which remains unclaimed
for a period of two years after the principal, premium or interest has become
due and payable will, upon our request, be repaid to us, and the holder of the
debt security may then look only to us for payment of those amounts. (section
11.05)
GOVERNING LAW
The indentures and the debt securities will be governed by and interpreted
in accordance with the laws of the State of New York. (section 13.05)
SUBORDINATION OF SUBORDINATED DEBT SECURITIES
The subordinated debt securities will be unsecured and will be subordinate
and junior in priority of payment to our other indebtedness on the terms
described in a prospectus supplement. The subordinated indenture does not limit
the amount of subordinated debt securities which MMC may issue, nor does it
limit our ability to issue any other secured or unsecured debt.
(section 14.01)
The prospectus supplement relating to any series of subordinated debt
securities will disclose the amount of debt of MMC that will be senior to those
subordinated debt securities.
PLAN OF DISTRIBUTION
MMC may sell the common stock, preferred stock or any series of debt
securities in one or more of the following ways (or in any combination) from
time to time:
o through underwriters or dealers;
o directly to a limited number of purchasers or to a single purchaser;
or
o through agents.
The prospectus supplements will state the terms of the offering of the
securities, including:
o the name or names of any underwriters, dealers or agents;
12
o the purchase price of such securities and the proceeds to be received
by MMC;
o any underwriting discounts or agency fees and other items constituting
underwriters' or agents' compensation;
o any initial public offering price;
o any discounts or concessions allowed or reallowed or paid to dealers;
and
o any securities exchanges on which the securities may be listed.
Any initial public offering price and any discounts or concessions allowed
or reallowed or paid to dealers may be changed from time to time.
If we use underwriters in the sale, the securities will be acquired by the
underwriters for their own account and may be resold from time to time in one or
more transactions, including:
o negotiated transactions,
o at a fixed public offering price or prices, which may be changed,
o at market prices prevailing at the time of sale,
o at prices related to prevailing market prices or
o at negotiated prices.
Unless otherwise stated in a prospectus supplement, the obligations of the
underwriters to purchase any securities will be conditioned on customary closing
conditions and the underwriters will be obligated to purchase all of such series
of securities, if any are purchased.
We may sell the securities through agents from time to time. The prospectus
supplement will name any agent involved in the offer or sale of the securities
and any commissions we pay to them. Generally, any agent will be acting on a
best efforts basis for the period of its appointment.
We may authorize underwriters, dealers or agents to solicit offers by
certain purchasers to purchase the securities from MMC at the public offering
price set forth in the prospectus supplement pursuant to delayed delivery
contracts providing for payment and delivery on a specified date in the future.
The contracts will be subject only to those conditions set forth in the
prospectus supplement, and the prospectus supplement will set forth any
commissions we pay for solicitation of these contracts.
Underwriters and agents may be entitled under agreements entered into with
MMC to indemnification by MMC against certain civil liabilities, including
liabilities under the Securities Act, or to contribution with respect to
payments which the underwriters or agents may be required to make. Underwriters
and agents may be customers of, engage in transactions with, or perform services
for MMC and its affiliates in the ordinary course of business.
Each series of securities will be a new issue of securities and will have
no established trading market other than the common stock which is listed on the
New York Stock Exchange, the Chicago Stock Exchange, the Pacific Exchange and
the London Stock Exchange. Any underwriters to whom securities are sold by MMC
for public offering and sale may make a market in the securities, but such
underwriters will not be obligated to do so and may discontinue any market
making at any time without notice. The securities, other than the common stock,
may or may not be listed on a national securities exchange.
WHERE YOU CAN FIND MORE INFORMATION
We file reports, proxy statements, and other information with the SEC.
These reports, proxy statements, and other information can be read and copied at
the SEC's Public Reference Room at 450 Fifth Street, N.W., Washington, D.C.
20549. Please call the SEC at 1-800-SEC-0330 for further information on the
Public Reference Room. The SEC maintains an internet site at http://www.sec.gov
that contains reports, proxy and information statements and other information
regarding companies that file electronically with the SEC, including MMC.
This prospectus is part of a registration statement we filed with the SEC.
This prospectus omits some information contained in the registration statement
in accordance with SEC rules and regulations. You should review the information
and exhibits in the registration statement for further information about us and
the
13
securities we are offering. Statements in this prospectus concerning any
document we filed as an exhibit to the registration statement or that we
otherwise filed with the SEC are not intended to be comprehensive and are
qualified by reference to these filings. You should review the complete document
to evaluate these statements.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referencing these filed documents. Any information referenced this way is
considered to be part of this prospectus, and any information filed with the SEC
subsequent to this prospectus will automatically be deemed to update and
supersede this information. We incorporate by reference the documents listed
below and any future filings we make with the SEC in accordance with Sections
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until we file a
post-effective amendment which indicates the termination of the offering of the
securities made by this prospectus:
o Annual Report on Form 10-K for the year ended December 31, 2002;
o Quarterly Reports on Form 10-Q for the quarters ended March 31, 2003
and June 30, 2003;
o Registration Statement on Form 8-B dated May 22, 1969, as amended by
the amendment on Form 8 dated February 3, 1987; and
o Registration Statement on Form 8-A dated October 10, 1997, as amended
by the amendment on Form-8/A dated January 26, 2000, and as further
amended by the amendment on Form 8-A/A dated June 20, 2002.
MMC will provide without charge upon written or oral request, a copy of any
or all of the documents which are incorporated by reference to this prospectus,
other than exhibits which are specifically incorporated by reference into those
documents. Requests should be directed to Investor Relations, Marsh & McLennan
Companies, Inc., 1166 Avenue of the Americas, New York, New York 10036-2774
(telephone number (212) 345-5000).
INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS
This prospectus and MMC's financial statements and other documents
incorporated by reference in this prospectus contain statements relating to
future results, which are forward-looking statements as that term is defined in
the Private Securities Litigation Act of 1995. Such statements may include,
without limitation, discussions concerning revenues, expenses, earnings, cash
flow, capital structure, pension funding, financial losses and expected
insurance recoveries resulting from the September 11, 2001 terrorist attack on
the World Trade Center in New York City, as well as market and industry
conditions, premium rates, financial markets, interest rates, foreign exchange
rates, contingencies and matters relating to MMC's operations and income taxes.
Such forward-looking statements are based on available current market and
industry materials, experts' reports and opinions and long-term trends, as well
as management's expectations concerning future events impacting MMC.
Forward-looking statements by their very nature involve risks and uncertainties.
Factors that may cause actual results to differ materially from those
contemplated by any forward-looking statements contained or incorporated or
referred to herein include, in the case of MMC's risk and insurance services and
consulting businesses, the amount of actual insurance recoveries and financial
losses from the September 11 attack on the World Trade Center, or other adverse
consequences from that incident. Other factors that should be considered in the
case of MMC's risk and insurance services business are changes in competitive
conditions, movements in premium rate levels, the continuation of difficult
conditions for the transfer of commercial risk and other changes in the global
property and casualty insurance markets, the impact of terrorist attacks,
natural catastrophes, mergers between client organizations, and insurance or
reinsurance company insolvencies. Factors to be considered in the case of MMC's
investment management business include changes in worldwide and national equity
and fixed income markets, actual and relative investment performance, the level
of sales and redemptions, and the ability to maintain investment management and
administrative fees at appropriate levels; and with respect to all of MMC's
activities, changes in general worldwide and national economic conditions,
changes in the value of investments made in individual companies and investment
funds, fluctuations in foreign currencies, actions of competitors or regulators,
changes in interest rates or in the ability to access financial markets,
developments relating to claims, lawsuits and contingencies, prospective and
retrospective changes in the tax or accounting treatment of MMC's operations,
and the impact of tax and other legislation and regulation in the jurisdictions
in which MMC operates.
14
We have no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or risks. New
information, future events or risks may cause the forward-looking events we
discuss in this prospectus not to occur.
LEGAL OPINIONS
The validity of the securities in respect of which this prospectus is being
delivered will be passed on for us by Davis Polk & Wardwell.
EXPERTS
The consolidated balance sheets of MMC and its subsidiaries as of December
31, 2002 and 2001, and the related consolidated statements of income,
stockholders' equity and comprehensive income, and cash flows for each of the
years in the three year period ended December 31, 2002, included and
incorporated by reference in MMC's Annual Report on Form 10-K for the year ended
December 31, 2002 and incorporated by reference into this registration
statement, have been audited by Deloitte & Touche LLP, an independent registered
public accounting firm, as stated in their reports (which express an unqualified
opinion and include an explanatory paragraph relating to the adoption of
Statement of Financial Accounting Standards No. 142, Goodwill and Other
Intangible Assets), which are incorporated herein by reference, and have been so
incorporated in reliance upon the reports of such firm given upon their
authority as experts in accounting and auditing.
15
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$1,150,000,000
[Grapic Omitted]
MARSH & MCLENNAN COMPANIES, INC.
$650,000,000 5.375% SENIOR NOTES DUE 2014
$500,000,000 FLOATING RATE SENIOR NOTES DUE 2007
----------------------
PROSPECTUS SUPPLEMENT
JULY 7, 2004
----------------------
BANC OF AMERICA SECURITIES LLC
CITIGROUP
DEUTSCHE BANK SECURITIES
GOLDMAN, SACHS & CO.
JPMORGAN
MERRILL LYNCH & CO.
================================================================================