Dvi Inc – ‘S-3’ on 4/24/98

As of:  Friday, 4/24/98   ·   Accession #:  950123-98-4101   ·   File #:  333-50895

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Registration Statement for Securities Offered Pursuant to a Transaction   —   Form S-3
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: S-3         Dvi, Inc.                                             33    210K 
 2: EX-5.1      Opinion of Rogers & Wells LLP                          3     18K 
 3: EX-23.2     Consent of Deloitte & Touce LLP                        1      5K 

S-3   —   Dvi, Inc.
Document Table of Contents

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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 24, 1998

                                               REGISTRATION NO. 333-
================================================================================

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------

FORM S-3
REGISTRATION STATEMENT
UNDER 
THE SECURITIES ACT OF 1933
------------------------

DVI, INC. 
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
------------------------

                                                                [Download Table]
                                                                               
            DELAWARE                                           22-2722773      
(STATE OR OTHER JURISDICTION OF                             (I.R.S. EMPLOYER   
 INCORPORATION OR ORGANIZATION)                          IDENTIFICATION NUMBER)

------------------------

500 HYDE PARK 

DOYLESTOWN, PENNSYLVANIA 18901
(215) 345-6600
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, 
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) 
------------------------

MICHAEL A. O'HANLON 

500 HYDE PARK 
DOYLESTOWN, PENNSYLVANIA 18901
(215) 345-6600
(NAME, ADDRESS INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
------------------------

WITH A COPY TO: 
JOHN A. HEALY, ESQ. 
ROGERS & WELLS LLP
200 PARK AVENUE 
NEW YORK, NEW YORK 10166
(212) 878-8000
------------------------

  APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement as determined by
market conditions.                                                              
If the only securities being registered on this Form are being offered  
pursuant to dividend or interest reinvestment plans, please check the following 
box.  [ ]                                                                       
   If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of  
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box.  [X]                               
If this form is filed to register additional securities for an offering 
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier        
effective registration statement for the same offering.  [ ]                    
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act   
registration statement number of the earlier effective registration statement   
for the same offering.  [ ]                                                     
  If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box.  [ ]                                            
------------------------

CALCULATION OF REGISTRATION FEE 

                                                        [Enlarge/Download Table]

===============================================================================================================================
                                                    PROPOSED MAXIMUM          PROPOSED MAXIMUM                                 
TITLE OF SECURITIES TO BE       AMOUNT TO BE         OFFERING PRICE          AGGREGATE OFFERING               AMOUNT OF        
      REGISTERED(1)            REGISTERED(2)          PER UNIT(3)              PRICE(2)(3)(4)            REGISTRATION FEE(5)   
                                                                                                                               
-------------------------------------------------------------------------------------------------------------------------------
Common Stock..............                                                                                                     
Preferred Stock...........                                                                                                     
Depositary Shares.........      $500,000,000                                    $500,000,000                  $147,500         
Debt Securities...........                                                                                                     
Warrants..................                                                                                                     
===============================================================================================================================

(1) This Registration Statement also covers securities which may be issued by   
the Registrant under contracts pursuant to which the counterparty may be
   required to purchase Common Stock, Preferred Stock, Depositary Shares, Debt
Securities or Warrants.                                                 
(2) In no event will the aggregate maximum offering price of the Common Stock,  
   Preferred Stock, Depositary Shares, Debt Securities and Warrants registered
under this Registration Statement exceed $500,000,000. Any securities   
registered hereunder may be sold separately or as units with other      
securities registered hereunder.                                        
(3) The proposed maximum offering price per unit (a) has been omitted pursuant  
 to instruction II.D. of Form S-3 and (b) will be determined, from time to
    time, by the Registrant in connection with the issuance by the Registrant of
the securities registered hereunder.                                    
(4) In U.S. dollars, or the equivalent thereof, denominated in one or more      
  foreign currencies or units of two or more foreign currencies or composite
currencies (such as European Currency Units).                           
(5) Calculated pursuant to Rule 457(o) of the rules and regulations promulgated 
under the Securities Act of 1933, as amended.                           
------------------------

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION       
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF  
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME    
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), 
MAY DETERMINE.                                                                  

================================================================================

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INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A           
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE     
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY    
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES  
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE         
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES 
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR  
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.   

SUBJECT TO COMPLETION, DATED APRIL   , 1998 

PROSPECTUS                                                                      

DVI, INC. 
$500,000,000

COMMON STOCK, PREFERRED STOCK, DEPOSITARY SHARES, 
DEBT SECURITIES AND WARRANTS

DVI, Inc. (the "Company") may from time to time offer, together or    
separately, in one or more series: (i) shares of common stock, par value $.005  
per share ("Common Stock"); (ii) shares of preferred stock, par value $10.00 per
share ("Preferred Stock"); (iii) debt securities consisting of debentures, notes
or other evidence of indebtedness and having such prices and terms as are       
determined at the time of sale ("Debt Securities"); (iv) shares of Preferred    
Stock represented by depositary shares ("Depositary Shares"); and (v) warrants  
or other rights to purchase Common Stock, Preferred Stock, Depositary Shares,   
Debt Securities, or any combination thereof, as may be designated by the Company
at the time of the offering ("Warrants"), with an aggregate public offering     
price of up to $500,000,000, in amounts, at prices and on terms to be determined
at the time of offering. The Common Stock, Preferred Stock, Depositary Shares,  
Debt Securities and Warrants (collectively, the "Securities") may be offered,   
separately or together, in separate series and in amounts, at prices and on     
terms to be set forth in one or more supplements to this Prospectus (each a     
"Prospectus Supplement").                                                       

     The specific terms of the Securities in respect of which this Prospectus is
being delivered will be set forth in the applicable Prospectus Supplement and   
will include, where applicable, in the case of Common Stock, the number of      
shares and the terms of the offering and sale; (ii) in the case of Preferred    
Stock, the number of shares, the specific title, the aggregate amount, any      
dividend (including the method of calculating payment of dividends), seniority, 
liquidation, redemption, voting and other rights, any terms for any conversion  
or exchange into other Securities, the initial public offering price and any    
other terms; (iii) in the case of Depositary Shares, the fractional share of    
Preferred Stock represented by each such Depositary Share; (iv) in the case of  
Debt Securities, the specific designation, aggregate principal amount, purchase 
price, authorized denomination, maturity, rate or rates or interest (or method  
of calculation thereof) and dates for payment thereof, dates from which interest
shall accrue, any exchangeability, conversion, redemption, prepayment or sinking
fund provisions and the currency or currencies or currency unit or currency     
units in which principal, premium, if any, or interest, if any, is payable; and 
(v) in the case of Warrants, the designation and number, the exercise price and 
any other terms in connection with the offering, sale and exercise of the       
Warrants. The Common Stock is listed on the New York Stock Exchange, Inc.       
("NYSE") under the symbol "DVI."                                                

   The applicable Prospectus Supplement will also contain information, where
applicable, about certain United States federal income tax considerations       
relating to, and any listing on a national securities exchange of, the          
Securities covered by such Prospectus Supplement, not contained in this         
Prospectus.                                                                     

   The Securities may be offered directly to one or more purchasers, through
agents designated from time to time by the Company or to or through underwriters
or dealers. If any agents or underwriters are involved in the sale of any of the
Securities, their names, and any applicable purchase price, fee, commission or  
discount arrangement between or among them, will be set forth, or will be       
calculable from the information set forth, in an accompanying Prospectus        
Supplement. The net proceeds to the Company from such sale will also be set     
forth in an accompanying Prospectus Supplement. No Securities may be sold by the
Company without delivery of a Prospectus Supplement describing the method and   
terms of the offering of such series of Securities. See "Plan of Distribution." 

THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK. FOR A    
DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE CONSIDERED IN CONNECTION WITH AN   
INVESTMENT IN THE SECURITIES, SEE "RISK FACTORS" COMMENCING ON PAGE 4.          
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE 
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. 

------------------------

The date of this Prospectus is                , 1998

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TABLE OF CONTENTS 

                                                                [Download Table]
                                                                   
AVAILABLE INFORMATION.......................................      2
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.............      2
RISK FACTORS................................................      4
THE COMPANY.................................................     10
RATIO OF EARNINGS TO FIXED CHARGES..........................     10
USE OF PROCEEDS.............................................     10
DESCRIPTION OF CAPITAL STOCK................................     11
DESCRIPTION OF DEPOSITARY SHARES............................     12
DESCRIPTION OF DEBT SECURITIES..............................     15
DESCRIPTION OF WARRANTS.....................................     24
PLAN OF DISTRIBUTION........................................     24
EXPERTS.....................................................     26
LEGAL MATTERS...............................................     26

AVAILABLE INFORMATION 

    The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance        
therewith files reports, proxy statements and other information with the        
Securities and Exchange Commission (the "Commission"). Such reports, proxy      
statements and other information filed by the Company can be inspected and      
copied at the public reference facilities maintained by the Commission at       
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549; and at its     
regional offices at 7 World Trade Center, 13th Floor, New York, New York 10048  
and at 500 West Madison Street, Suite 1400, Chicago, Illinois, 60661-2511.      
Copies of such material can be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed     
rates. The Commission also maintains a Web site that contains reports, proxy    
statements and other information regarding registrants that file electronically 
with the Commission at http://www.sec.gov. Reports, proxy statements and other  
information concerning the Company can also be inspected at the office of the   
New York Stock Exchange, 20 Broad Street, New York, New York 10005, on which    
exchange the Common Stock is traded.                                            

    This Prospectus constitutes a part of a Registration Statement on Form S-3
(together with all amendments and exhibits, the "Registration Statement") filed 
by the Company with the Commission under the Securities Act of 1933, as amended 
(the "Securities Act"). This Prospectus omits certain of the information        
contained in the Registration Statement and the exhibits and schedules thereto, 
in accordance with the rules and regulations of the Commission. For further     
information concerning the Company and the Securities offered hereby, reference 
is hereby made to the Registration Statement and the exhibits and schedules     
filed therewith, which may be inspected without charge at the office of the     
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and copies of     
which may be obtained from the Commission at prescribed rates. Any statements   
contained herein concerning the provisions of any document are not necessarily  
complete, and, in each instance, reference is made to the copy of such document 
filed as an exhibit to the Registration Statement or otherwise filed with the   
Commission. Each such statement is qualified in its entirety by such reference. 

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE 

   The following documents filed with the Commission are incorporated herein
by reference:                                                                   

          (a) The Company's Annual Report on Form 10-K for its fiscal year ended
June 30, 1997, as amended by Form 10-K/A-1 dated October 28, 1997 (the
"1997 10-K").                                                         

      (b) The Company's Quarterly Reports on Form 10-Q for the quarterly
periods ended September 30, 1997 and December 31, 1997.               

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        (c) The Company's Current Report on Form 8-K dated October 29, 1997.

         (d) All other reports filed pursuant to Section 13(a) or 15(d) of the
 Exchange Act since the end of the fiscal year covered by the 1997 10-K.

All documents filed by the Company after the date of the Prospectus   
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to   
the filing of a post-effective amendment which indicates that all securities    
offered hereby have been sold or which deregisters all securities then remaining
unsold, shall be deemed to be incorporated by reference in this Prospectus and  
to be a part hereof from the date of the filing of such documents. Any statement
contained in a document incorporated or deemed to be incorporated by reference  
into this Prospectus will be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained in this Prospectus or  
any other subsequently filed document which also is or is deemed to be          
incorporated by reference into this Prospectus modifies or supersedes that      
statement.                                                                      

     THE COMPANY HEREBY UNDERTAKES TO PROVIDE, WITHOUT CHARGE, TO EACH PERSON TO
WHOM THIS PROSPECTUS IS DELIVERED, UPON WRITTEN OR ORAL REQUEST OF SUCH PERSON, 
A COPY OF ANY AND ALL DOCUMENTS INCORPORATED BY REFERENCE INTO THE REGISTRATION 
STATEMENT OTHER THAN EXHIBITS TO SUCH DOCUMENTS (UNLESS SUCH EXHIBITS ARE       
SPECIFICALLY INCORPORATED BY REFERENCE INTO SUCH DOCUMENTS). REQUESTS FOR SUCH  
COPIES SHOULD BE DIRECTED TO: DVI, INC., 500 HYDE PARK, DOYLESTOWN, PENNSYLVANIA
18901 (TELEPHONE: 215-345-6600), ATTENTION: LEGAL DEPARTMENT.                   

  Additional updating information with respect to the matters discussed in
this Prospectus may be provided in the future by means of appendices to this    
Prospectus or other documents.                                                  

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RISK FACTORS

  An investment in the Securities offered hereby involves a high degree of
risk. Prospective purchasers of Securities should carefully consider the        
following risk factors in addition to the other information set forth in this   
Prospectus, any Prospectus Supplement and the documents incorporated by         
reference herein.                                                               

  DEPENDENCE ON WAREHOUSE FINANCING.  The Company's ability to sustain the
growth of its financing business is dependent upon funding obtained through     
warehouse facilities until its equipment and other loans are permanently funded.
The funds the Company obtains through warehouse facilities are full recourse    
short-term borrowings secured primarily by the underlying equipment, the medical
receivables and other collateral. These borrowings are in turn typically repaid 
with the proceeds received by the Company when its equipment and other loans are
securitized or sold. At December 31, 1997 the Company had available an aggregate
of approximately $435.5 million under various warehouse facilities,             
approximately $323.5 million of which is available for funding equipment loans  
and approximately $112.0 million of which is available for funding medical      
receivables loans. There can be no assurance that this type of warehouse        
financing will continue to be available to the Company on acceptable terms. If  
the Company were unable to arrange continued access to acceptable warehouse     
financing, the Company would have to curtail its equipment and other loan       
originations, which in turn would have a material adverse effect on the         
Company's financial condition and results of operations.                        

DEPENDENCE ON PERMANENT FUNDING PROGRAMS.  The Company's use of       
securitization as its principal form of permanent funding is an important part  
of the Company's business strategy. If for any reason the Company were to become
unable to access the securitization markets to fund permanently its equipment   
and other loans, the consequences for the Company would be materially adverse.  
The Company's ability to complete securitizations and other structured finance  
transactions depends upon a number of factors, including general conditions in  
the credit markets, the size and liquidity of the market for the types of       
receivable-backed securities issued or placed in securitizations sponsored by   
the Company and the overall performance of the Company's loan portfolio. The    
Company does not have binding commitments from financial institutions or        
investment banks to provide permanent funding for its equipment or medical      
receivables loans.                                                              

IMPACT OF CREDIT ENHANCEMENT REQUIREMENTS.  In connection with its    
securitizations and other structured financings, the Company is required to     
provide credit enhancement for the debt obligations issued and sold to third    
parties. Typically, the credit enhancement consists of cash deposits, the       
funding of subordinated tranches and/or the pledge of additional equipment or   
other loans that are funded with the Company's capital. The requirement to      
provide this credit enhancement reduces the Company's liquidity and requires it 
to obtain additional capital. If the Company is unable to obtain and maintain   
sufficient capital, it may be required to halt or curtail its securitization or 
other structured financing programs, which in turn would have a material adverse
effect on the Company's financial condition and operations.                     

 CREDIT RISK.  Many of the Company's customers are outpatient healthcare
providers, the loans to whom often require a high degree of credit analysis.    
Although the Company seeks to mitigate its risk of default and credit losses    
through its underwriting practices and loan servicing procedures and through the
use of various forms of non-recourse or limited recourse financing (in which the
financing sources that permanently fund the Company's equipment and other loans 
assume some or all of the risk of default by the Company's customers), the      
Company remains exposed to potential losses resulting from a default by an      
obligor. Obligors' defaults could cause the Company to make payments to the     
extent the Company is obligated to do so and in the case of its permanent       
equipment and other funding arrangements to the extent of the Company's         
remaining credit enhancement position; could result in the loss of the cash or  
other collateral pledged as credit enhancement under its permanent equipment and
other funding arrangements; or could require the Company to forfeit any residual
interest it may have retained in the underlying equipment. During the period    
after the Company initially funds an equipment or other loan and prior to the   
time it funds the loan on a permanent basis, the Company is exposed to full     
recourse liability in the event of default by the obligor. In addition, under   
the terms of securitizations and other types of structured finance transactions,
the Company generally is required to replace or repurchase equipment and other  
loans in the event they fail to conform to the representations and              

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warranties made by the Company, even in transactions otherwise designated as    
non-recourse or limited recourse.                                               

Defaults by the Company's customers also could adversely affect the   
Company's ability to obtain additional financing in the future, including its   
ability to use securitization or other forms of structured finance. The sources 
of such permanent funding take into account the credit performance of the       
equipment and other loans previously financed by the Company in deciding whether
and on what terms to make new loans. In addition, the credit rating agencies and
insurers that are often involved in securitizations consider prior credit       
performance in determining the rating to be given to the securities issued in   
securitizations sponsored by the Company and whether and on what terms to insure
such securities. To date, all of the Company's medical receivable loans (as     
opposed to its equipment loans) have been funded on a full recourse basis       
whereby the Company is fully liable for any losses that are incurred.           

Under the Company's wholesale loan origination program, the Company   
purchases equipment loans from originators that generally do not have direct    
access to the securitization market as a source of permanent funding for their  
loans. The Company does not work directly with the borrowers at the origination 
of these equipment loans and therefore is not directly involved in structuring  
the credits, however the Company independently verifies credit information      
supplied by the originator. Accordingly, the Company faces a somewhat higher    
degree of risk when it acquires loans under the wholesale program on a wholesale
basis. During the twelve-month period ended June 30, 1997 and the six month     
period ended December 31, 1997, loans purchased under the Wholesale Program     
constituted 21% and 10%, respectively, of the total loans originated during such
periods. There can be no assurance that the Company will be able to grow this   
business successfully or avoid the credit risks related to wholesale loan       
origination.                                                                    

INTEREST RATE RISK.  When the Company borrows funds through warehouse 
facilities, it is exposed to certain risks caused by interest rate fluctuations.
Although the Company's equipment loans are structured and permanently funded on 
a fixed interest rate basis, it uses warehouse facilities until permanent       
funding is obtained. The Company uses hedging techniques to protect its interest
rate margins during the period that warehouse facilities are used prior to an   
anticipated securitization and sale because funds borrowed through warehouse    
facilities are obtained on a floating interest rate basis. The Company uses     
derivative financial instruments, such as forward rate agreements, forward      
market sales or purchases of treasury securities, and interest rate swaps and   
caps, to manage its interest rate risk. The derivatives are used to manage three
components of this risk; mismatches of the maturity of assets and liabilities on
the Company's balance sheet, hedging anticipated loan securitizations and sales,
and interest rate spread protection. There can be no assurance, however, that   
the Company's hedging strategy or techniques will be effective, that the        
profitability of the Company will not be adversely affected during any period of
changes in interest rates or that the costs of hedging will not exceed the      
benefits. A substantial and sustained increase in interest rates could adversely
affect the Company's ability to originate loans. In certain circumstances, the  
Company for a variety of reasons may retain for an indefinite period certain of 
the equipment and other loans it originates. In such cases, the Company's       
interest rate exposure may continue for a longer period of time.                

     SUBSTANTIAL LEVERAGE.  The Company has substantial outstanding indebtedness
and is highly leveraged. As of December 31, 1997, the Company and its           
consolidated subsidiaries had total debt of $557.2 million, of which $345.6     
million was full recourse debt and $211.6 million was limited recourse debt. Of 
the $557.2 million of total debt, $371.5 million was long-term debt and $185.7  
million was short-term debt. The ability of the Company to repay its            
indebtedness will depend upon future operating performance, which is subject to 
the performance of the Company's loan portfolio, the success of the Company's   
business strategy, prevailing economic conditions, levels of interest rates and 
financial, business and other factors, many of which are beyond the Company's   
control. The degree to which the Company is leveraged also may impair its       
ability to obtain additional financing on acceptable terms.                     

   ABILITY TO SERVICE DEBT; NEGATIVE CASH FLOWS AND CAPITAL NEEDS.  Although
the Company believes that cash available from operations and financing          
activities will be sufficient to enable it to make required interest payments on
the Debt Securities and its other debt obligations and other required payments, 
there can be no assurance in this regard and the Company may encounter liquidity
problems which could affect its ability to                                      

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meet such obligations while attempting to withstand competitive pressures or    
adverse economic conditions. In such circumstances, the value of the Debt       
Securities could be materially adversely affected.                              

 In a securitization, the Company recognizes a gain on sale of the loans
securitized upon the closing of the securitization, but does not receive the    
cash representing such gain until it receives the excess servicing, which in    
general is payable over the actual life of the loans securitized. The Company   
incurs significant expense in connection with a securitization and incurs both  
current and deferred tax liabilities as a result of the gain on sale. Therefore,
the Company requires continued access to short- and long-term external sources  
of cash to fund its operations.                                                 

     The Company expects to continue to operate on a negative cash flow basis as
the volume of the Company's loan purchases and originations increases and its   
securitization program grows. The Company's primary cash requirements include   
the funding of: (i) loan originations and purchases pending their securitization
and sale; (ii) fees and expenses incurred in connection with the securitization 
of loans; (iii) reserve account or overcollateralization requirements in        
connection with the securitization and sale of the loans; (iv) ongoing          
administrative and other operating expenses; and (v) interest and principal     
payments under the Company's warehouse facilities and other indebtedness.       

     The Company's primary sources of liquidity in the future are expected to be
existing cash fundings under its warehouse facilities, sales of loans through   
securitizations and other permanent fundings, the net proceeds from sales of    
Debt Securities and further issuances of debt or equity.                        

  The Company's primary sources of liquidity as described in the paragraph
above are expected to be sufficient to fund the Company's liquidity requirements
for at least the next 12 months if the Company's future operations are          
consistent with management's current growth expectations. However, because the  
Company expects to continue to operate on a negative cash flow basis for the    
foreseeable future, it anticipates that it will need to effect debt or equity   
financings regularly. The type, timing and terms of financing selected by the   
Company will be dependent upon the Company's cash needs, the availability of    
other financing sources and the prevailing conditions in the financial markets. 
There can be no assurance that any such sources will be available to the Company
at any given time or as to the favorableness of the terms on which such sources 
may be available.                                                               

    HOLDING COMPANY STRUCTURE; LIMITATIONS ON ACCESS TO CASH FLOW OF OPERATING
COMPANIES; EFFECTIVE SUBORDINATION.  The Debt Securities will be obligations    
solely of the Company, which is a holding company with no business operations of
its own. The Company's assets consist primarily of its ownership interests in   
its operating subsidiaries and all of the operations of the Company are         
conducted through its subsidiaries, which are separate and distinct legal       
entities and, unless otherwise provided in any Prospectus Supplement, have no   
obligations, contingent or otherwise, to pay any amounts due pursuant to the    
Debt Securities or to make any funds available to the Company to enable it to   
make payments on the Debt Securities or meet working capital needs or other     
liabilities of the Company, or for any other reason. In addition, to the extent 
that any of the operating subsidiaries generates positive cash flow, the Company
may be unable to access such cash flow because certain of such entities are     
currently or may become parties to credit or other borrowing agreements that    
restrict or prohibit the payment of dividends or interest and principal on the  
Debt Securities, and such entities are likely to continue to be subject to such 
restrictions and prohibitions for the foreseeable future. The Debt Securities   
also will be effectively subordinated to all existing and future indebtedness   
and other liabilities of the Company's subsidiaries because the Company's right 
to receive the assets of any such entities upon their liquidation, dissolution  
or reorganization will be effectively subordinated to the claims of such        
entities' creditors arising from the first priority perfected liens on those    
assets granted under warehouse facilities and other loans. To the extent that   
the Company is itself recognized as a creditor of any such subsidiary, the      
claims of the Company would still be subordinated to the claims of such         
entities' trade creditors as well as any indebtedness of such entity that is    
senior in right of payment to the Company's claim or that is secured by the     
assets of any such entity. As of December 31, 1997, the Company's subsidiaries  
had total debt of $467.6 million, $236.0 million of which was full recourse and 
$231.6 million of which was limited recourse.                                   

     POSSIBLE ADVERSE CONSEQUENCES FROM RECENT GROWTH.  In the past three years,
the Company originated a significantly greater number of equipment and other    
loans than it did in previous years. As a result of this                        

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rapid growth, the Company's loan portfolio grew from $405.8 million at June 30, 
1995 to $662.3 million at December 31, 1997. In light of this growth, the       
historical performance of the Company's loan portfolio, including rates of      
credit loss, may be of limited relevance in predicting future loan portfolio    
performance. Any credit or other problems associated with the large number of   
equipment and other loans originated in the recent past will not become apparent
until sometime in the future. Further, while the Company's loan originations    
have grown substantially in the past three years, its net interest margins have 
declined during that same period due to a general decline in interest rates, the
Company's pricing strategy, the sale of higher-yielding loans to finance the    
cost of its developing domestic and international business units and the        
increase in the amount of lower-yielding credit enhancements due to the         
increased number of securitizations. Periodic permanent financing which shifts  
portions of the Company's borrowings from short-term facilities to more costly  
long-term facilities increases the cost of funds. As a result, the Company's    
historical results of operations may be of limited relevance to an investor     
seeking to predict the Company's future performance.                            

    ABILITY TO SUSTAIN GROWTH.  To sustain the rates of growth it has achieved
in the last three years, the Company will be required to penetrate further the  
markets for lower cost diagnostic imaging equipment and for other types of      
medical equipment or devices such as lasers used in patient treatment. The      
Company faces significant barriers to entry in the patient treatment device     
market, which is more diverse than the diagnostic imaging market because of the 
larger number of manufacturers and types of products and the greater price range
of those products. The Company has limited experience in the patient treatment  
device market. In an effort to obtain access to new markets, the Company has    
initiated operations internationally and has made investments in certain        
emerging markets. The success and ultimate recovery of these investments is     
dependent upon many factors including foreign regulation and business practices,
currency exchange regulations and currency fluctuations and the achievement of  
management's planned objectives for these markets. There can be no assurance    
that the Company will be able to penetrate and compete effectively in the       
markets described above.                                                        

    RISKS RELATED TO THE MEDICAL RECEIVABLE FINANCING BUSINESS.  In July 1993,
the Company entered the medical receivable financing business and expects to    
focus on this business as a part of the Company's growth strategy. The Company's
medical receivable financing business generally consists of providing loans to  
healthcare providers that are secured by their receivables from payors such as  
insurance companies, large self-insured companies and governmental programs and 
by other collateral. While the Company expects to focus on this business as a   
significant part of its growth strategy, there can be no assurance that the     
Company will be able to expand this business successfully or avoid related      
liabilities or losses. The Company has funded its medical receivable financial  
business to date through the use of the Company's capital; $100 million in      
securitizations; a rated warehouse facility of $30 million; and is in the       
process of obtaining a committed $100 million revolving credit facility. The    
growth of the Company's medical receivable financing business is dependent upon 
the Company's ability to obtain additional funding facilities to finance medical
receivables loans.                                                              

While the medical receivable financing business shares certain        
characteristics, including an overlapping customer base, with the Company's core
equipment financing business, there are many differences, including unique      
risks. Healthcare providers could overstate the quality and characteristics of  
their medical receivables, which the Company analyzes in determining the amount 
of the line of credit to be secured by such receivables. After the Company has  
established or funded a line of credit, the healthcare providers could change   
their billing and collection systems, accounting systems or patient records in a
way that could adversely affect the Company's ability to monitor the quality    
and/or performance of the related medical receivables. There are technical legal
issues associated with creating and maintaining perfected security interests in 
medical receivables, specifically those generated by Medicaid and Medicare      
claims. Payors may make payments directly to healthcare providers that have the 
effect (intentionally or otherwise) of circumventing the Company's rights in and
access to such payments. Payors may attempt to offset their payments to the     
Company against debts owed to the payors by the healthcare providers. In        
addition, as a lender whose position is secured by receivables, the Company is  
likely to have less leverage in collecting outstanding receivables in the event 
of a borrower's insolvency than a lender whose position is secured by medical   
equipment that the borrower needs to run its business. A borrower that receives 
medical receivables loans from the Company and                                  

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defaults on obligations secured by such receivables may require additional      
loans, or modifications to the terms of existing loans, in order to continue    
operations and repay outstanding loans. The Company may have a conflict of      
interest when it acts as servicer for an equipment-based securitization and     
originates medical receivables loans to borrowers whose equipment loans have    
been securitized. The Company's efforts to develop suitable sources of funding  
for its medical receivable financing business through securitization or other   
structured finance transactions may be constrained or hindered due to the fact  
that the use of structured finance transactions to fund medical receivables is a
relatively new process. While the Company believes it has structured its credit 
policies and lending practices to take into account these and other factors,    
there can be no assurance the Company will not sustain credit losses in         
connection with its medical receivable financing business or that the medical   
receivable financing business will meet the Company's growth expectations.      

     MEDICAL EQUIPMENT MARKET.  The demand for the Company's equipment financing
services is affected by numerous factors beyond the control of the Company.     
These factors include general economic conditions, including the effects of     
recession or inflation, and fluctuations in supply and demand for various types 
of sophisticated medical equipment resulting from, among other things,          
technological and economic obsolescence and government regulation. In addition, 
the demand for sophisticated medical equipment also may be negatively affected  
by reductions in the amount of reimbursement to healthcare providers for their  
services from third-party payors such as insurance companies, large self-insured
companies and government programs, and the increased use of managed healthcare  
plans that often restrict the use of certain types of high technology medical   
equipment. At December 31, 1997, financing for purchases of magnetic resonance  
imaging ("MRI") machines accounted for approximately 38% (by dollar volume) of  
the total loans originated by the Company. Any substantial decrease in the      
Company's loan originations for the purchase of MRI machines could have a       
material adverse effect on the Company.                                         

  HEALTHCARE REFORM.  During the past half decade, large U.S. corporations
and U.S. consumers of healthcare services have substantially increased their use
of managed healthcare plans such as HMOs and PPOs. This development has         
increased the purchasing power of those plans, which in turn have used that     
power to lower the amounts they pay for healthcare services. Since 1993,        
numerous proposals have been presented to Congress to restructure the U.S.      
healthcare system. The principal features of these proposals are to provide     
universal access to healthcare services and to achieve overall cost containment.
To date, none of the proposals initiated at the federal government level have   
been enacted. In the private sector, however, cost containment initiatives have 
continued. Certain aspects of these actual and proposed cost containment        
initiatives, particularly plans to eliminate payment for duplicative procedures,
may reduce the overall demand for the types of medical equipment financed by the
Company. Declining reimbursement for medical services also could cause          
hospitals, physician groups and other healthcare providers, which form a        
significant portion of the Company's customer base, to experience cash flow     
problems. This in turn could negatively impact their ability to meet their      
financial obligations to the Company and/or reduce their future equipment       
acquisitions which could adversely affect the Company. The Company believes that
the general movement toward a managed healthcare system in the U.S. will        
materially reduce the demand for medical equipment and for related financing.   

DEPENDENCE ON REFERRALS AND SUPPORT FROM EQUIPMENT MANUFACTURERS.  The
Company obtains a significant amount of its equipment financing business through
referrals from manufacturers of diagnostic imaging equipment and other          
manufacturers of medical equipment it finances. In addition, these manufacturers
occasionally provide credit support for or assume first loss positions with     
respect to equipment financing they refer to the Company. These manufacturers   
are not contractually obligated to refer their customers to the Company for     
equipment financing or to provide credit support or assume first loss positions 
in connection with their referrals. There is no assurance that these            
manufacturers will continue to refer equipment financing opportunities to the   
Company or to provide credit support or assume first loss positions. If for any 
reason the Company were no longer to benefit from these referrals or related    
credit support and assumptions of first loss positions, its equipment financing 
business would be materially adversely affected.                                

    COMPETITION.  The business of financing sophisticated medical equipment is
highly competitive. The Company competes with equipment manufacturers that sell 
and finance sales of their own equipment and finance subsidiaries of national   
and regional commercial banks and equipment leasing and financing               

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companies. Many of the Company's competitors have significantly greater         
financial and marketing resources than the Company. In addition, the competition
in the new markets recently targeted by the Company, specifically the patient   
treatment device financing market and medical receivable financing market, may  
be greater than the levels of competition historically experienced by the       
Company.                                                                        

    The Company believes that increased equipment loan originations during the
past three years resulted, in part, from a decrease in the number of competitors
in the higher cost medical equipment financing market and the Company's high    
level of penetration in this market. There can be no assurance that new         
competitive providers of financing will not enter the medical equipment         
financing market in the future. To meet its long-term growth objectives, the    
Company must penetrate further its targeted markets for lower cost medical      
equipment and medical receivable financing businesses. Such penetration may     
require the Company to reduce its margins to be competitive in the lower cost   
medical equipment and medical receivable financing businesses. In addition,     
there can be no assurance that the Company will sustain the same level of       
equipment loan originations in future periods as during the past three years or 
that it will be able to meet its long-term growth objectives.                   

    DEPENDENCE UPON KEY PERSONNEL.  The ability of the Company to successfully
continue its existing financing business, to expand into its targeted markets   
and to develop its newer businesses depends upon the ability of the Company to  
retain the services of its key management personnel, including Michael A.       
O'Hanlon, the Company's President and Chief Executive Officer and Steven R.     
Garfinkel, the Company's Executive Vice President and Chief Financial Officer.  
The loss of any of these individuals or an inability to attract and maintain    
additional qualified personnel could adversely affect the Company. There can be 
no assurance that the Company will be able to retain its existing management    
personnel or to attract additional qualified personnel.                         

  RISKS ASSOCIATED WITH DILUTION.  To the extent the Company issues Common
Stock, the ownership interest of existing stockholders would be diluted. Such   
dilution may be substantial.                                                    

  YEAR 2000 CONCERNS.  The Company believes, based on discussions with its
current systems vendors, that its software applications and operational programs
will properly recognize calendar dates beginning in the Year 2000. In addition, 
the Company is discussing with its customers and suppliers the possibility of   
any interface difficulties relating to the Year 2000 which may affect the       
Company. To date, no significant concerns have been identified, however, there  
can be no assurance that there will not be any Year 2000-related operating      
problems or expenses that will arise with the Company's computer systems and    
software or in connection with the Company's interface with the computer systems
and software of its vendors and customers and suppliers.                        

     FORWARD-LOOKING INFORMATION.  This Prospectus contains and any amendment or
supplement hereto may contain various forward-looking statements based on       
assumptions made by and information currently available to management. When used
in this Prospectus and any amendment or supplement, the words "expect,"         
"believe," "estimate," "project" and similar expressions are intended to        
identify forward looking statements. The Company wishes to ensure that such     
statements are accompanied by meaningful cautionary statements pursuant to the  
safe harbor established in the Private Securities Litigation Reform Act of 1995.
Such statements are subject to certain risks, uncertainties and assumptions     
including those identified in this section. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove incorrect,    
actual results may vary materially from those expected, believed, estimated or  
projected. Additionally, new risk factors may emerge from time to time and      
management cannot predict such risk factors, nor can it assess the impact, if   
any, of such risk factors on the Company's business or the extent to which any  
factor, or combination of factors, may cause actual results to differ materially
from those projected in any forward-looking statements.                         

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THE COMPANY 

 DVI is an independent specialty finance company that conducts a medical
equipment finance business and a related medical receivables finance business.  
As of December 31, 1997, the Company's total assets and shareholder's equity    
were $726.3 million and $106.3 million, respectively.                           

    The Company finances the acquisition of diagnostic imaging and other types
of sophisticated medical equipment used by outpatient healthcare providers,     
medical imaging centers, groups of physicians, integrated healthcare delivery   
networks and hospitals. The Company's equipment finance business operates by (i)
providing financing directly to end users of equipment; (ii) providing finance  
programs for vendors of diagnostic and patient treatment devices; and (iii)     
purchasing medical equipment loans and leases originated by regional finance    
companies ("Originators") through the Company's wholesale loan purchase program 
(the "Wholesale Program"). The Company also provides lines of credit to a wide  
variety of healthcare providers, many of which are also equipment finance       
customers. Substantially all of the lines of credit are collateralized by third 
party medical receivables due from Medicare, Medicaid, HMO, PPOs and commercial 
insurance companies. By effectively and efficiently servicing the equipment     
financing needs of healthcare providers and at the same time building productive
relationships with medical equipment manufacturers and vendors seeking to       
arrange financing for their customers, the Company has established a niche      
leadership position among independent finance companies serving the medical     
industry.                                                                       

 The Company is a Delaware corporation and conducts its business through
operating subsidiaries. The principal operating subsidiaries are DVI Financial  
Services Inc. ("DVI Financial Services") and DVI Business Credit Corporation    
("DVI Business Credit"). The Company conducts securitizations through indirect  
wholly-owned subsidiaries. The Company also conducts other structured financings
through its operating subsidiaries. The borrowers under the Company's various   
warehouse credit facilities are DVI Financial Services or DVI Business Credit.  
Except as the context otherwise requires, the term "Company" refers to DVI, Inc.
and its wholly owned subsidiaries.                                              

The executive offices of the Company are located at 500 Hyde Park,    
Doylestown, Pennsylvania 18901 (Telephone: 215-345-6600).                       

RATIO OF EARNINGS TO FIXED CHARGES

    The following are the ratios of consolidated earnings to fixed charges for
the Company for each of the fiscal years ended June 30, 1993, 1994, 1995, 1996  
and 1997 and for the six months ended December 31, 1996 and 1997.               

                                                        [Enlarge/Download Table]

                                                                                 SIX MONTHS 
                                                                                   ENDED    
                                               FISCAL YEAR ENDED JUNE 30,       DECEMBER 31,
                                          ------------------------------------  ------------
                                          1993    1994    1995    1996    1997  1996    1997
                                          ----    ----    ----    ----    ----  ----    ----
                                                                                            
Ratio:................................... 1.89    1.49    1.31    1.47    1.41  1.42    1.42

 For purposes of computing this ratio, earnings consist of earnings from
continuing operations before provision for income taxes, equity in net loss of  
investees and discontinued operations. Fixed charges are interest expense.      

USE OF PROCEEDS 

Except as may otherwise be set forth in the applicable Prospectus     
Supplement, the Company intends to use the net proceeds from the sale of the    
Securities offered hereby for general corporate purposes, which may include the 
continued expansion and diversification of its financing activities, both by    
internal growth and by acquisition; repayment of any outstanding indebtedness of
the Company or its subsidiaries; or for such other uses as may be set forth in a
Prospectus Supplement. Pending any of the foregoing applications, the net       
proceeds may be invested temporarily in short-term, interest bearing securities.

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DESCRIPTION OF CAPITAL STOCK

   The authorized capital stock of the Company consists of 25,000,000 shares
of Common Stock and 100,000 shares of Preferred Stock. As of January 30, 1998,  
there were 10,953,384 shares of Common Stock issued and outstanding. No shares  
of Preferred Stock are outstanding.                                             

     The description of the capital stock set forth below does not purport to be
complete and is qualified in its entirety by reference to the Company's         
certificate of incorporation, as amended (the "Certificate of Incorporation"),  
and bylaws, as amended (the "Bylaws"). All material terms of the Common Stock   
and the Preferred Stock, except those disclosed in the applicable Prospectus    
Supplement, are described in this Prospectus.                                   

COMMON STOCK                                                                    

 Holders of shares of Common Stock are entitled to one vote per share on
matters to be voted upon by the stockholders of the Company. Holders of shares  
of Common Stock do not have cumulative voting rights; therefore, the holders of 
more than 50% of the Common Stock will have the ability to elect all of the     
Company's directors. Holders of shares of Common Stock will be entitled to      
receive dividends when, as and if declared by the Board of Directors and to     
share ratably in the assets of the Company legally available for distribution to
its stockholders in the event of the liquidation, dissolution or winding up of  
the Company, in each case subject to the rights of the holders of any Preferred 
Stock issued by the Company. Holders of Common Stock have no preemptive,        
subscription, redemption or conversion rights.                                  

PREFERRED STOCK                                                                 

     The following description of the Preferred Stock sets forth certain general
terms and provisions of the Preferred Stock to which any Prospectus Supplement  
may relate. The statements below describing the Preferred Stock are in all      
respects subject to and qualified in their entirety by reference to the         
applicable provisions of the Certificate of Incorporation and Bylaws and any    
applicable Certificate of Designations designating the terms of a series of     
Preferred Stock (a "Certificate of Designations").                              

Prior to issuance of shares of each series, the Board of Directors is 
required by the Delaware General Corporation Law ("DGCL") and the Certificate of
Incorporation to fix for each series the terms, preferences, conversion or other
rights, voting powers, restrictions, limitations as to dividends or other       
distributions, qualifications and terms or conditions of redemption of such     
shares as may be permitted by Delaware law. Such rights, powers, restrictions   
and limitations could include the right to receive specified dividend payments  
and payments on liquidation prior to any such payments to holders of Common     
Stock or other capital stock of the Company ranking junior to the Preferred     
Stock. The shares of Preferred Stock will be, when issued, fully paid and       
nonassessable.                                                                  

    The Board of Directors could authorize the issuance of shares of Preferred
Stock with terms and conditions that could have the effect of discouraging a    
takeover or other transaction that holders of Common Stock might believe to be  
in their best interests or in which holders of some, or a majority, of the      
shares of Common Stock might receive a premium for their shares over the then   
market price of such shares of Common Stock.                                    

  Reference is made to the Prospectus Supplement relating to the Preferred
Stock offered thereby for specific terms, including: (i) the title and stated   
value of such Preferred Stock; (ii) the number of shares of such Preferred Stock
offered, the liquidation preference per share and the offering price of such    
Preferred Stock; (iii) the dividend rate(s), period(s) and/or payment date(s) or
method(s) of calculation thereof applicable to such Preferred Stock; (iv) the   
date from which dividends on such Preferred Stock shall accumulate, if          
applicable; (v) the procedures for any auction and remarketing, if any, for such
Preferred Stock; (vi) the provision for a sinking fund, if any, for such        
Preferred Stock; (vii) the provision for redemption, if applicable, of such     
Preferred Stock; (viii) any listing of such Preferred Stock on any national     
securities exchange; (ix) the terms and conditions, if applicable, upon which   
such Preferred Stock will be convertible into Common Stock, including the       
conversion price (or manner of calculation thereof); (x) any                    

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other specific terms, preferences, rights, limitations or restrictions of such  
Preferred Stock; (xi) a discussion of federal income tax considerations         
applicable to such Preferred Stock; (xii) the relative ranking and preference of
such Preferred Stock as to dividend rights and rights upon liquidation,         
dissolution or winding up of the affairs of the Company; and (xiii) any         
limitations on issuance of any series of Preferred Stock ranking senior to or on
a parity with such series of Preferred Stock as to dividend rights and rights   
upon liquidation, dissolution or winding up of the affairs of the Company.      

    As described under "Description of Depositary Shares," the Company may, at
its option, elect to offer Depositary Shares evidenced by depositary receipts   
("Depositary Receipts"), each representing an interest (to be specified in the  
Prospectus Supplement relating to the particular series of the Preferred Stock) 
in a share of the particular series of Preferred Stock issued and deposited with
a Preferred Stock Depositary (as defined below).                                

DESCRIPTION OF DEPOSITARY SHARES

The description set forth below, and in any applicable Prospectus     
Supplement, of certain provisions of the Deposit Agreement (as defined below)   
and of the Depositary Shares and Depositary Receipts summarizes the material    
terms of the Deposit Agreement and of the Depositary Shares and Depositary      
Receipts and is qualified in its entirety by reference to the form of Deposit   
Agreement and form of Depositary Receipts relating to each series of the        
Preferred Stock.                                                                

GENERAL                                                                         

    The Company may, at its option, elect to have shares of Preferred Stock be
represented by Depositary Shares. The shares of any series of the Preferred     
Stock underlying the Depositary Shares will be deposited under a separate       
deposit agreement (the "Deposit Agreement") between the Company and a bank or   
trust company (the "Preferred Stock Depositary") selected by the Company. The   
Prospectus Supplement relating to a series of Depositary Shares will set forth  
the name and address of the Preferred Stock Depositary. Subject to the terms of 
the Deposit Agreement, each owner of a Depositary Share will be entitled,       
proportionately, to all the rights, preferences and privileges of the Preferred 
Stock represented thereby (including dividend, voting, redemption, conversion,  
exchange and liquidation rights, if any).                                       

The Depositary Shares will be evidenced by Depositary Receipts issued 
pursuant to the Deposit Agreement, each of which will represent the applicable  
interest in a number of shares of a particular series of the Preferred Stock    
described in the applicable Prospectus Supplement.                              

 A holder of Depositary Shares will be entitled to receive the shares of
Preferred Stock (but only in whole shares of Preferred Stock) underlying such   
Depositary Shares. If the Depositary Receipts delivered by the holder evidence a
number of Depositary Shares in excess of the whole number of shares of Preferred
Stock to be withdrawn, the Depositary will deliver to such holder at the same   
time a new Depositary Receipt evidencing such excess number of Depositary       
Shares.                                                                         

DIVIDENDS AND OTHER DISTRIBUTIONS                                               

    The Preferred Stock Depositary will distribute all cash dividends or other
cash distributions, if any, with respect to the Preferred Stock to the record   
holders of Depositary Receipts in proportion, insofar as possible, to the number
of Depositary Shares owned by such holders. In the event of a distribution other
than in cash with respect to the Preferred Stock, the Preferred Stock Depositary
will distribute property received by it to the record holders of Depositary     
Receipts in proportion, insofar as possible, to the number of Depositary Shares 
owned by such holders, unless the Preferred Stock Depositary determines that it 
is not feasible to make such distribution in which case the Preferred Stock     
Depositary may, with the approval of the Company, adopt such method as it deems 
equitable and practicable for the purpose of effecting such distribution,       
including sale (public or private) of such property and distribution of the net 
proceeds from such sale to such holders.                                        

    The amount so distributed in any of the foregoing cases will be reduced by
any amount required to be withheld by the Company or the Preferred Stock        
Depositary on account of taxes.                                                 

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CONVERSION AND EXCHANGE                                                         

If any Preferred Stock underlying the Depositary Shares is subject to 
provisions relating to its conversion or exchange as set forth in the Prospectus
Supplement relating thereto, each record holder of Depositary Shares will have  
the right or obligation to convert or exchange such Depositary Shares pursuant  
to the terms thereof.                                                           

REDEMPTION OF DEPOSITARY SHARES                                                 

If Preferred Stock underlying the Depositary Shares is subject to     
redemption, the Depositary Shares will be redeemed from the proceeds received by
the Preferred Stock Depositary resulting from the redemption, in whole or in    
part, of the Preferred Stock held by the Preferred Stock Depositary. The        
redemption price per Depositary Share will be equal to the aggregate redemption 
price payable with respect to the number of shares of Preferred Stock underlying
the Depositary Shares. Whenever the Company redeems Preferred Stock from the    
Preferred Stock Depositary, the Preferred Stock Depositary will redeem as of the
same redemption date a proportionate number of Depositary Shares representing   
the shares of Preferred Stock that were redeemed. If less than all of the       
Depositary Shares are to be redeemed, the Depositary Shares to be redeemed will 
be selected by lot or pro rata, as may be determined by the Company.            

  After the date fixed for redemption, the Depositary Shares so called for
redemption will no longer be deemed to be outstanding and all rights of the     
holders of the Depositary Shares will cease, except the right to receive the    
redemption price upon such redemption. Any funds deposited by the Company with  
the Preferred Stock Depositary for any Depositary Shares which the holders      
thereof fail to redeem shall be returned to the Company after a period of two   
years from the date such funds are so deposited.                                

VOTING                                                                          

     Upon receipt of notice of any meeting at which the holders of any shares of
Preferred Stock underlying the Depositary Shares are entitled to vote, the      
Preferred Stock Depositary will mail the information contained in such notice to
the record holders of the Depositary Receipts. Each record holder of such       
Depositary Receipts on the record date (which will be the same date as the      
record date for the Preferred Stock) will be entitled to instruct the Preferred 
Stock Depositary as to the exercise of the voting rights pertaining to the      
number of shares of Preferred Stock underlying such holder's Depositary Shares. 
The Preferred Stock Depositary will endeavor, insofar as practicable, to vote   
the number of shares of Preferred Stock underlying such Depositary Shares in    
accordance with such instructions, and the Company will agree to take all       
reasonable action which may be deemed necessary by the Preferred Stock          
Depositary in order to enable the Preferred Stock Depositary to do so. The      
Preferred Stock Depositary will abstain from voting the Preferred Stock to the  
extent it does not receive specific written instructions from holders of        
Depositary Receipts representing the Preferred Stock.                           

RECORD DATE                                                                     

Whenever (i) any cash dividend or other cash distribution shall become
payable, any distribution other than cash shall be made, or any rights,         
preferences or privileges shall be offered with respect to the Preferred Stock  
or (ii) the Preferred Stock Depositary shall receive notice of any meeting at   
which holders of Preferred Stock are entitled to vote or of which holders of    
Preferred Stock are entitled to notice, or of the mandatory conversion of or any
election on the part of the Company to call for the redemption of any Preferred 
Stock, the Preferred Stock Depositary shall in each such instance fix a record  
date (which shall be the same as the record date for the Preferred Stock) for   
the determination of the holders of Depositary Receipts (x) who shall be        
entitled to receive such dividend, distribution, rights, preferences or         
privileges or the net proceeds of the sale thereof or (y) who shall be entitled 
to give instructions for the exercise of voting rights at any such meeting or to
receive notice of such meeting or of such redemption or conversion, subject to  
the provisions of the Deposit Agreement.                                        

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AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT                              

   The form of Depositary Receipt and any provision of the Deposit Agreement
may at any time be amended by agreement between the Company and the Preferred   
Stock Depositary. However, any amendment which imposes or increases any fees,   
taxes or other charges payable by the holders of Depositary Receipts (other than
taxes and other governmental charges, fees and other expenses payable by such   
holders as stated under "Charges of Preferred Stock Depositary"), or which      
otherwise prejudices any substantial existing right of holders of Depositary    
Receipts, will not take effect as to outstanding Depositary Receipts until the  
expiration of 90 days after notice of such amendment has been mailed to the     
record holders of outstanding Depositary Receipts.                              

  Whenever so directed by the Company, the Preferred Stock Depositary will
terminate the Deposit Agreement by mailing notice of such termination to the    
record holders of all Depositary Receipts then outstanding at least 30 days     
prior to the date fixed in such notice for such termination. The Preferred Stock
Depositary may likewise terminate the Deposit Agreement if at any time 45 days  
shall have expired after the Preferred Stock Depositary shall have delivered to 
the Company a written notice of its election to resign and a successor          
depositary shall not have been appointed and accepted its appointment. If any   
Depositary Receipts remain outstanding after the date of termination, the       
Preferred Stock Depositary thereafter will discontinue the transfer of          
Depositary Receipts, will suspend the distribution of dividends to the holders  
thereof, and will not give any further notices (other than notice of such       
termination) or perform any further acts under the Deposit Agreement except as  
provided below and except that the Preferred Stock Depositary will continue (i) 
to collect dividends on the Preferred Stock and any other distributions with    
respect thereto and (ii) to deliver the Preferred Stock together with such      
dividends and distributions and the net proceeds of any sales of rights,        
preferences, privileges or other property without liability for interest        
thereon, in exchange for Depositary Receipts surrendered. At any time after the 
expiration of two years from the date of termination, the Preferred Stock       
Depositary may sell the Preferred Stock then held by it at public or private    
sales, at such place or places and upon such terms as it deems proper and may   
thereafter hold the net proceeds of any such sale, together with any money and  
other property then held by it, without liability for interest thereon, for the 
pro rata benefit of the holders of Depositary Receipts which have not been      
surrendered.                                                                    

CHARGES OF PREFERRED STOCK DEPOSITARY                                           

The Company will pay all charges of the Preferred Stock Depositary    
including charges in connection with the initial deposit of the Preferred Stock,
the initial issuance of the Depositary Receipts, the distribution of information
to the holders of Depositary Receipts with respect to matters on which Preferred
Stock is entitled to vote, withdrawals of the Preferred Stock by the holders of 
Depositary Receipts or redemption or conversion of the Preferred Stock, except  
for taxes (including transfer taxes, if any) and other governmental charges and 
such other charges as are expressly provided in the Deposit Agreement to be at  
the expense of holders of Depositary Receipts or persons depositing Preferred   
Stock.                                                                          

MISCELLANEOUS                                                                   

The Preferred Stock Depositary will make available for inspection by  
holders of Depositary Receipts at its corporate office and its New York office, 
all reports and communications from the Company which are delivered to the      
Preferred Stock Depositary as the holder of Preferred Stock.                    

     Neither the Preferred Stock Depositary nor the Company will be liable if it
is prevented or delayed by law or any circumstance beyond its control in        
performing its obligations under the Deposit Agreement. The obligations of the  
Preferred Stock Depositary under the Deposit Agreement will be limited to       
performing its duties thereunder without negligence or bad faith. The           
obligations of the Company under the Deposit Agreement will be limited to       
performing its duties thereunder in good faith. Neither the Company nor the     
Preferred Stock Depositary is obligated to prosecute or defend any legal        
proceeding in respect of any Depositary Shares or Preferred Stock unless        
satisfactory indemnity is furnished. The Company and the Preferred Stock        
Depositary are entitled to rely upon advice of or information from counsel,     
accountants or other persons believed to be competent and on documents believed 
to be genuine.                                                                  

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    The Preferred Stock Depositary may resign at any time or be removed by the
Company, effective upon the acceptance by its successor of its appointment;     
provided, that if the successor Preferred Stock Depositary has not been         
appointed or accepted such appointment within 45 days after the Preferred Stock 
Depositary has delivered a notice of election to resign to the Company, the     
Preferred Stock Depositary may terminate the Deposit Agreement. See "Amendment  
and Termination of Deposit Agreement" above.                                    

DESCRIPTION OF DEBT SECURITIES

    The Debt Securities may be issued from time to time in one or more series.
The particular terms of each series of Debt Securities offered by any Prospectus
Supplement will be described therein. The Debt Securities will be issued under  
the Indenture (the "Indenture"), between the Company and First Trust National   
Association, as trustee (the "Trustee"). The Indenture is subject to and        
governed by the Trust Indenture Act of 1939, as amended.                        

     The statements herein relating to the Debt Securities and the Indenture are
summaries and are subject to the detailed provisions of the Indenture. The      
following summaries of certain provisions of the Indenture do not purport to be 
complete and, where reference is made to particular provisions of the Indenture,
such provisions, including the definitions of certain terms, are incorporated by
reference as a part of such summaries or terms, which are qualified in their    
entirety by such reference and with respect to any particular Debt Securities,  
to the description thereof in the Prospectus Supplement related thereto. The    
definitions of certain capitalized terms used in the following summary are set  
forth below under "Certain Definitions."                                        

GENERAL                                                                         

    The Indenture does not limit the aggregate amount of Debt Securities which
may be issued thereunder, and Debt Securities may be issued thereunder from time
to time in separate series up to the aggregate amount from time to time         
authorized by the Company for each series. The Debt Securities when issued will 
be direct, unsecured obligations of the Company and will rank equally with all  
other unsecured and unsubordinated indebtedness of the Company.                 

   The applicable Prospectus Supplement will describe the following terms of
the series of Debt Securities in respect of which this Prospectus is being      
delivered: (1) the title of such Debt Securities; (2) any limit on the aggregate
principal amount of such Debt Securities; (3) the person to whom any interest on
any Debt Security of the series shall be payable if other than the person in    
whose name the Debt Security is registered on the regular record date; (4) the  
date or dates on which such Debt Securities will mature; (5) the rate or rates  
of interest, if any, or the method of calculation thereof, which such Debt      
Securities will bear, the date or dates from which any such interest will       
accrue, the interest payment dates on which any such interest on such Debt      
Securities will be payable and the regular record date for any interest payable 
on any interest payment date; (6) the place or places where the principal of and
any premium and interest on such Debt Securities will be payable; (7) the period
or periods within which, the events upon the occurrence of which, and the price 
or prices at which, such Debt Securities may, pursuant to any optional or       
mandatory provisions, be redeemed or purchased, in whole or in part, by the     
Company and any terms and conditions relevant thereto; (8) the obligations of   
the Company, if any, to redeem or repurchase such Debt Securities at the option 
of the Holders; (9) the denominations in which any such Debt Securities will be 
issuable, if other than denominations of $1,000 and any integral multiple       
thereof; (10) any index or formula used to determine the amount of payments of  
principal of and any premium and interest on such Debt Securities; (11) the     
currency, currencies or currency unit or units of payment of principal of and   
any premium and interest on such Debt Securities if other than U.S. dollars;    
(12) if the principal of, or premium, if any, or interest on such Debt          
Securities is to be payable, at the election of the Company or a holder thereof,
in one or more currencies or currency units other than that or those in which   
such Debt Securities are stated to be payable, the currency, currencies or      
currency units in which payment of the principal of and any premium and interest
on Debt Securities of such series as to which such election is made shall be    
payable, and the periods within which and the terms and conditions upon which   
such election is to be made; (13) if other than the principal amount thereof,   
the portion of the principal amount of such Debt Securities which will be       
payable upon acceleration of the maturity thereof;                              

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(14) if the principal amount of any Debt Securities which will be payable at the
maturity thereof will not be determinable as of any date prior to such maturity,
the amount which will be deemed to be the outstanding principal amount of such  
Debt Securities; (5) the applicability of any provisions described under        
"-- Defeasance or Covenant Defeasance of Indenture"; (16) whether any of such   
Debt Securities are to be issuable in permanent global form ("Global Security") 
and, if so, the terms and conditions, if any, upon which interests in such Debt 
Securities in global form may be exchanged, in whole or in part, for the        
individual Debt Securities represented thereby; (17) the applicability of, and  
modifications to, any provisions described under "Events of Default" and any    
additional Event of Default applicable thereto; (18) any covenants applicable to
such Debt Securities in addition to, or in lieu of, the covenants described     
under "-- Certain Covenants of the Company"; (19) whether such Debt Securities  
are secured; and (20) any other terms of such Debt Securities not inconsistent  
with the provisions of the Indenture.                                           

  Debt Securities may be issued at a discount from their principal amount.
United States Federal income tax considerations and other special considerations
applicable to any such original issue discount Debt Securities will be described
in the applicable Prospectus Supplement.                                        

 If the purchase price of any of the Debt Securities is denominated in a
foreign currency or currencies or a foreign currency unit or units or if the    
principal of and any premium and interest on any series of Debt Securities is   
payable in a foreign currency or currencies or a foreign currency unit or units,
the restrictions, elections, general tax considerations, specific terms and     
other information with respect to such issue of Debt Securities will be set     
forth in the applicable Prospectus Supplement.                                  

FORM, REGISTRATION, TRANSFER AND PAYMENT                                        

 Unless otherwise indicated in the applicable Prospectus Supplement, the
Debt Securities will be issued only in fully registered form in denominations of
$1,000 or integral multiples thereof. Unless otherwise indicated in the         
applicable Prospectus Supplement, payment of principal, premium, if any, and    
interest on the Debt Securities will be payable, and the transfer of Debt       
Securities will be registerable, at the office or agency of the Company         
maintained for such purposes and at any other office or agency maintained for   
such purpose. No service charge will be made for any registration of transfer of
the Debt Securities, but the Company may require payment of a sum sufficient to 
cover any tax or other governmental charge imposed in connection therewith.     

All monies paid by the Company to a Paying Agent (as defined in the   
Indenture) for the payment of principal of and any premium or interest on any   
Debt Security which remain unclaimed for two years after such principal, premium
or interest has become due and payable may be repaid to the Company and         
thereafter the Holder (as defined in the Indenture) of such Debt Security may   
look only to the Company for payment thereof.                                   

BOOK-ENTRY DEBT SECURITIES                                                      

  The Debt Securities of a series may be issued in whole or in part in the
form of one or more Global Securities that will be deposited with, or on behalf 
of, a Depositary ("Depositary") or its nominee identified in the applicable     
Prospectus Supplement. In such a case, one or more Global Securities will be    
issued in a denomination or aggregate denomination equal to the portion of the  
aggregate principal amount of outstanding Debt Securities of the series to be   
represented by such Global Security or Global Securities. Unless and until it is
exchanged in whole or in part for Debt Securities in registered form, a Global  
Security may not be registered for transfer or exchange except as a whole by the
Depositary for such Global Security to a nominee of such Depositary or by a     
nominee of such Depositary to such Depositary or another nominee of such        
Depositary or by such Depositary or any nominee to a successor Depositary or a  
nominee of such successor Depositary and except in the circumstances described  
in the applicable Prospectus Supplement.                                        

The specific terms of the depositary arrangement with respect to any  
portion of a series of Debt Securities to be represented by a Global Security   
will be described in the applicable Prospectus Supplement. The Company expects  
that the following provisions will apply to depositary arrangements.            

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  Unless otherwise specified in the applicable Prospectus Supplement, Debt
Securities which are to be represented by a Global Security to be deposited with
or on behalf of a Depositary will be represented by a Global Security registered
in the name of such Depositary or its nominee. Upon the issuance of such Global 
Security, and the deposit of such Global Security with or on behalf of the      
Depositary for such Global Security, the Depositary will credit, on its         
book-entry registration and transfer system, the respective principal amounts of
the Debt Securities represented by such Global Security to the accounts of      
institutions that have accounts with such Depositary or its nominee             
("participants"). The accounts to be credited will be designated by the         
underwriters of, or agents for, such Debt Securities or by the Company, if such 
Debt Securities are offered and sold directly by the Company. Ownership of      
beneficial interests in such Global Security will be limited to participants or 
persons that may hold interests through participants. Ownership of beneficial   
interests by participants in such Global Security will be shown on, and the     
transfer of that ownership interest will be effected only through, records      
maintained by the Depositary or its nominee for such Global Security. Ownership 
of beneficial interests in such Global Security by persons that hold through    
participants will be shown on, and the transfer of such ownership interests will
be effected only through, records maintained by such participant. The laws of   
some jurisdictions require that certain purchasers of securities take physical  
delivery of such securities in certificated form. The foregoing limitations and 
such laws may impair the ability to transfer beneficial interests in such Global
Securities.                                                                     

Debt Securities will be issued in fully registered, certificated form 
("Definitive Securities") to holders or their nominees, rather than to the      
Depositary or its nominee, only if (i) the Depositary advises the applicable    
Trustee in writing that the Depositary is no longer willing or able to discharge
properly its responsibilities as depositary with respect to such Debt Securities
and it is unable to locate a qualified successor, (ii) the Company, at its      
option, elects to terminate the book-entry system or (iii) after the occurrence 
of an Event of Default with respect to such Debt Securities, a Holder of Debt   
Securities advises the applicable Trustee in writing that it wishes to receive a
Definitive Security.                                                            

 Upon the occurrence of any event described in the immediately preceding
paragraph, the applicable Trustee will be required to notify all applicable     
holders through the Depositary and its participants of the availability of      
Definitive Securities. Upon surrender by the Depositary of the definitive       
certificates representing the corresponding Debt Securities and receipt of      
instructions for re-registration, the applicable Trustee will reissue such Debt 
Securities as Definitive Securities to such holders.                            

 So long as the Depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depositary or nominee will be    
considered the sole owner or holder of the Securities represented by such Global
Security for all purposes under the Indenture. Unless otherwise specified in the
applicable Prospectus Supplement, owners of beneficial interests in such Global 
Security will not be entitled to have Debt Securities of the series represented 
by such Global Security registered in their names, will not receive or be       
entitled to receive physical delivery of Debt Securities of such series in      
certificated form and will not be considered the holders thereof for any        
purposes under the Indenture. Accordingly, each person owning a beneficial      
interest in such Global Security must rely on the procedures of the Depositary  
and, if such person is not a participant, on the procedures of the participant  
through which such person owns its interest, to exercise any rights of a holder 
under the Indenture. The Company understands that under existing industry       
practices, if the Company requests any action of holders or an owner of a       
beneficial interest in such Global Security desires to give any notice or take  
any action a holder is entitled to give or take under the Indenture, the        
Depositary would authorize the participants to give such notice or take such    
action, and participants would authorize beneficial owners owning through such  
participants to give such notice or take such action or would otherwise act upon
the instructions of beneficial owners owning through them.                      

Principal of and any premium and interest on a Global Security will be
payable in the manner described in the applicable Prospectus Supplement.        

CERTAIN DEFINITIONS                                                             

"Capital Stock" of any person means any and all shares, interests,    
partnership interests, participations, rights in or other equivalents (however  
designated) of such person's equity interest (however designated).              

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"Capitalized Lease Obligation" means, with respect to any person, an  
obligation incurred or assumed under or in connection with any capital lease of 
real or personal property that, an obligation incurred or assumed under or in   
connection with any capital lease of real or personal property that, in         
accordance with GAAP, has been recorded as a capitalized lease.                 

"Closing Date" means, with respect to any Debt Securities, the date on
which such Debt Securities are originally issued under the Indenture.           

     "Consolidated Net Worth" means, at any date of determination, stockholders'
equity of the Company and its Restricted Subsidiaries as set forth on the most  
recently available quarterly or annual consolidated balance sheet of the Company
and its Restricted Subsidiaries, less any amounts attributable to Disqualified  
Stock or any equity security convertible into or exchangeable for Debt, the cost
of treasury stock and the principal amount of any promissory notes receivable   
from the sale of the Capital Stock of the Company or any of its Restricted      
Subsidiaries, each item to be determined in conformity with GAAP (excluding the 
effects of foreign currency adjustments under Financial Accounting Standards    
Board Statement of Financial Accounting Standards No. 52).                      

 "Debt" means (without duplication), with respect to any person, whether
recourse is to all or a portion of the assets of such person and whether or not 
contingent (a) every obligation of such person for money borrowed, (b) every    
obligation of such person evidenced by bonds, debentures, notes or other similar
instruments, (c) every reimbursement obligation of such person with respect to  
letters of credit, bankers' acceptances or similar facilities issued for the    
account of such person, (d) every obligation of such person issued or assumed as
the deferred purchase price of property or services, (e) Capitalized Lease      
Obligations, (f) all Disqualified Stock of such person valued at its maximum    
fixed repurchase price, plus accrued and unpaid dividends, (g) all obligations  
of such person under or in respect of Hedging Agreements, and (h) every         
obligation of the type referred to in clauses (a) through (g) of another person 
and all dividends of another person the payment of which, in either case, such  
person has guaranteed. For purposes of this definition, the "maximum fixed      
repurchase price" of any Disqualified Stock that does not have a fixed          
repurchase price will be calculated in accordance with the terms of such        
Disqualified stock as if such Disqualified Stock were repurchased on any date on
which Debt is required to be determined pursuant to the Indenture, and if such  
price is based upon, or measured by, the fair market value of such Disqualified 
Stock, such fair market value will be determined in good faith by the board of  
directors of the issuer of such Disqualified Stock. Notwithstanding the         
foregoing, trade accounts payable and accrued liabilities arising in the        
ordinary course of business and any liability for federal, state or local taxes 
or other taxes owed by such person will not be considered Debt for purposes of  
this definition.                                                                

  "Default" means any event that is, or after notice or passage of time or
both would be, an Event of Default.                                             

"Disqualified Stock" means any class or series of Capital Stock that, 
either by its terms, by the terms of any security into which it is convertible  
or exchangeable or by contract or otherwise (i) is or upon the happening of any 
event or passage of time would be, required to be redeemed prior to the final   
Stated Maturity of the Notes, (ii) is redeemable at the option of the holder    
thereof at any time prior to such final Stated Maturity or (iii) at the option  
of the holder thereof, is convertible into or exchangeable for debt securities  
at any time prior to such final Stated Maturity.                                

"Exchange Act" means the Securities Exchange Act of 1934, as amended. 

"Generally Accepted Accounting Principles" or "GAAP" means generally  
accepted accounting principles in the United States, consistently applied, that 
are in effect on the Closing Date.                                              

"Hedging Obligations" means the obligations of any person under (i)   
interest rate swap agreements, interest rate cap agreements and interest rate   
collar agreements and (ii) other agreements or arrangements designed to protect 
such person against fluctuations in interest rates or the value of foreign      
currencies.                                                                     

   "Lien" means any mortgage, charge, pledge, lien (statutory or otherwise),
privilege, security interest, hypothecation, assignment for security, claim, or 
preference or priority or other encumbrance upon or with                        

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respect to any property of any kind, real or personal, movable or immovable, now
owned or hereafter acquired. A person will be deemed to own subject to a Lien   
any property that such person has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital lease or other   
title retention agreement.                                                      

 "Restricted Subsidiary" means any Subsidiary other than an Unrestricted
Subsidiary.                                                                     

 "Significant Subsidiary" means any Restricted Subsidiary of the Company
that together with its Subsidiaries, (a) for the most recent fiscal year of the 
Company, accounted for more than 10% of the consolidated net sales of the       
Company and its Restricted Subsidiaries or (b) as to the end of such fiscal     
year, was the owner of more than 10% of the consolidated assets of the Company  
and its Restricted Subsidiaries, in the case of either (a) or (b), as set forth 
on the most recently available consolidated financial statements of the Company 
for such fiscal year or (c) was organized or acquired since the end of such     
fiscal year and would have been a Significant Subsidiary if it had been owned   
during such fiscal year.                                                        

"Stated Maturity" means, when used with respect to any Note or any    
installment of interest thereon, the date specified in such Note as the fixed   
date on which the principal of such Note or installment of interest is due and  
payable and, when used with respect to any other Debt, means the date specified 
in the instrument governing such Debt as the fixed date on which the principal  
of such Debt or any installment of interest thereon is due and payable.         

    "Subsidiary" means any person a majority of the equity ownership or Voting
Stock of which is at the time owned, directly or indirectly, by the Company     
and/or one or more other Subsidiaries of the Company.                           

  "Unrestricted Subsidiary" means (a) any Subsidiary that is designated by
the Board of Directors as an Unrestricted Subsidiary in accordance with the     
"Unrestricted Subsidiaries" covenant and (b) any Subsidiary of an Unrestricted  
Subsidiary.                                                                     

CERTAIN COVENANTS OF THE COMPANY                                                

 Unless otherwise specified in the applicable Prospectus Supplement, the
following covenants contained in the Indenture shall be applicable with respect 
to each series of Debt Securities:                                              

  LIMITATION ON INVESTMENT COMPANY STATUS.  The Company shall not take any
action, or otherwise permit to exist any circumstance, that would require the   
Company or any of its subsidiaries to register as an "investment company" under 
the Investment Company Act of 1940, as amended.                                 

   REPORTS.  The Company will be required to file on a timely basis with the
Commission, to the extent such filings are accepted by the Commission and       
whether or not the Company has a class of securities registered under the       
Exchange Act, the annual reports, quarterly reports and other documents that the
Company would be required to file if it were subject to Section 13 or 15(d) of  
the Exchange Act. The Company will also be required (a) to file with the        
applicable Trustee, and provide to each holder of Debt Securities, without cost 
to such holder, copies of such reports and documents within 15 days after the   
date on which the Company files such reports and documents with the Commission  
or the date on which the Company would be required to file such reports and     
documents if the Company were so required and (b) if filing such reports and    
documents with the Commission is not accepted by the Commission or is prohibited
under the Exchange Act, to supply at the Company's cost copies of such reports  
and documents to any prospective holder of Debt Securities promptly upon written
request.                                                                        

EVENTS OF DEFAULT                                                               

 Unless otherwise specified in the applicable Prospectus Supplement, the
following will constitute "Events of Default" under the Indenture with respect  
to Debt Securities of any series (unless they are inapplicable to such series of
Debt Securities or they are specifically deleted in the supplemental indenture  
or the Board Resolution under which such series of Debt Securities is issued or 
has been modified):                                                             

      (a) default in the payment of any interest on any Debt Security of
such series when it becomes due and payable, and continuance of such  
default for a period of 30 days;                                      

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       (b) default in the payment of the principal of (or premium, if any,
on) any Debt Security of such series when due;                        

  (c) failure to perform or comply with the Indenture provisions
described under "Consolidation, Merger and Sale of Assets";           

 (d) default in the performance, or breach, of any covenant or
   agreement of the Company contained in the Indenture (other than a default
in the performance, or breach, of a covenant or agreement that is     
     specifically dealt with elsewhere therein), and continuance of such default
  or breach for a period of 60 days after written notice has been given to
     the Company by the Trustee or to the Company and the Trustee by the holders
 of at least 25% in aggregate principal amount of the Debt Securities of
such series then outstanding as provided in the Indenture;            

      (e) (i) an event of default has occurred under any mortgage, bond,
    indenture, loan agreement or other document evidencing an issue of Debt of
 the Company or any Significant Subsidiary, which issue has an aggregate
outstanding principal amount of not less than $5.0 million, and such  
default has resulted in such Debt becoming, whether by declaration or 
  otherwise, due and payable prior to the date on which it would otherwise
   become due and payable or (ii) a default in any payment when due at final
maturity of any such Debt;                                            

       (f) failure by the Company or any of its Restricted Subsidiaries to
   pay one or more final judgments the uninsured portion of which exceeds in
the aggregate $5.0 million, which judgment or judgments are not paid, 
discharged or stayed for a period of 60 days;                         

     (g) the occurrence of certain events of bankruptcy, insolvency or
   reorganization with respect to the Company or any Significant Subsidiary;
or                                                                    

(h) any other Event of Default specified for such series.   

     If an Event of Default (other than as specified in clause (g) above) occurs
and is continuing under the Indenture applicable to any series of Debt          
Securities, the Trustee or the holders of not less than 25% in aggregate        
principal amount of the Debt Securities of such series then outstanding may     
declare the principal of all of the outstanding Debt Securities of such series  
immediately due and payable and, upon any such declaration, such principal will 
become due and payable immediately.                                             

If an Event of Default specified in clause (g) above occurs and is    
continuing, then the principal of all of the outstanding Debt Securities of any 
series will ipso facto become and be immediately due and payable without any    
declaration or other act on the part of the Trustee or any holder of Debt       
Securities of such series.                                                      

  At any time after a declaration of acceleration under the Indenture, but
before a judgment or decree for payment of the money due has been obtained by   
the Trustee, the holders of a majority in aggregate principal amount of the     
outstanding Debt Securities of any series, by written notice to the Company and 
the Trustee, may rescind such declaration and its consequences if (i) the       
Company has paid or deposited with the Trustee a sum sufficient to pay (A) all  
overdue interest on all Debt Securities of such series, (B) all unpaid principal
of (and premium, if any, on) any outstanding Debt Securities of such series that
has become due otherwise than by such declaration of acceleration and interest  
thereon at the rate borne by the Debt Securities of such series, (C) to the     
extent that payment of such interest is lawful, interest upon overdue interest  
and overdue principal at the rate borne by the Debt Securities of such series   
and, (D) all sums paid or advanced by the Trustee under the Indenture and the   
reasonable compensation, expenses, disbursements and advances of the Trustee,   
its agents and counsel; and (ii) all Events of Default, other than the          
non-payment of amounts of principal of (or premium, if any, on) or interest on  
the Debt Securities of such series that have become due solely by such          
declaration of acceleration, have been cured or waived. No such rescission will 
affect any subsequent default or impair any right consequent thereto.           

  The holders of not less than a majority in aggregate principal amount of
the outstanding Debt Securities of any series may, on behalf of the holders of  
all of the Debt Securities of such series, waive any past defaults under the    
Indenture, except a default in the payment of the principal of (and premium, if 
any on) or interest                                                             

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on any Debt Securities of such series, or in respect of a covenant or provision 
that under the Indenture cannot be modified or amended without the consent of   
the holder of each such Debt Security outstanding.                              

     If a Default or an Event of Default occurs with respect to a series of Debt
Securities and is continuing and is known to the Trustee, the Trustee will mail 
to each holder of the Debt Securities of such series notice of the Default or   
Event of Default within 90 days after the occurrence thereof. Except in the case
of a Default or an Event of Default in payment of principal of (and premium, if 
any, on) or interest on any Debt Securities of any series, the Trustee may      
withhold the notice to the holders of the Debt Securities of such series if a   
committee of its trust officers in good faith determines that withholding such  
notice is in the interests of the holders of the Debt Securities of such series.

   The Company is required to furnish to the Trustee annual statements as to
the performance by the Company and any Subsidiary Guarantors (as defined in the 
Indenture) of their respective obligations under the Indenture and as to any    
default in such performance. The Company is also required to notify the Trustee 
within five days of any Default.                                                

SATISFACTION AND DISCHARGE OF THE INDENTURE AND THE DEBT SECURITIES             

    Upon the request of the Company, the Indenture will cease to be of further
effect (except as to surviving rights of registration of transfer of the Debt   
Securities of any series outstanding under the Indenture, as expressly provided 
for in the Indenture) and the Trustee, at the expense of the Company, will      
execute proper instruments acknowledging satisfaction and discharge of the      
Indenture when (a) either (i) all the Debt Securities of any series theretofore 
authenticated and delivered (other than destroyed, lost or stolen Debt          
Securities of any series that have been replaced or paid and Debt Securities of 
any series that have been subject to defeasance under "Defeasance or Covenant   
Defeasance of Indenture") have been delivered to the Trustee for cancellation or
(ii) all Debt Securities of any series not theretofore delivered to the Trustee 
for cancellation (A) have become due and payable, (B) will become due and       
payable at maturity within one year or (C) are to be called for redemption      
within one year under arrangements satisfactory to the Trustee for the giving of
notice of redemption by the Trustee in the name, and at the expense, of the     
Company, and the Company has irrevocably deposited or caused to be deposited    
with the Trustee funds in trust for the purpose and in an amount sufficient to  
pay and discharge the entire Debt on such Debt Securities of any series not     
theretofore delivered to the Trustee for cancellation, for principal (and       
premium, if any, on) and interest on the Debt Securities of any series to the   
date of such deposit (in the case of Debt Securities of any series that have    
become due and payable) or to the Stated Maturity or Redemption Date (as defined
in the Indenture), as the case may be; (b) the Company has paid or caused to be 
paid all sums payable under the Indenture by the Company; and (c) the Company   
has delivered to the Trustee an officers' certificate and an opinion of counsel,
each stating that all conditions precedent provided in the Indenture relating to
the satisfaction and discharge of the Indenture have been complied with.        

MODIFICATION AND WAIVER                                                         

  Modifications and amendments of the Indenture may be made by the Company
and the Trustee with the consent of the holders of a majority in aggregate      
outstanding principal amount of the Debt Securities of any series to be offered 
under the Indenture; provided, however, that no such modification or amendment  
may, without the consent of the holder of each outstanding Debt Security of such
series affected thereby,                                                        

          (a) change the Stated Maturity of the principal of, or any installment
     of interest on, any Debt Securities of such series, or reduce the principal
    amount thereof or the rate of interest thereon or any premium payable upon
  the redemption thereof, or change the coin or currency in which any Debt
Securities of such series or any premium or the interest thereon is   
   payable, or impair the right to institute suit for the enforcement of any
such payment after the Stated Maturity thereof (or, in the case of    
redemption, on or after the Redemption Date);                         

     (b) reduce the percentage in principal amount of outstanding Debt
     Securities of such series, the consent of whose holders is required for any
  waiver of compliance with certain provisions of, or certain defaults and
their consequences provided for under, the Indenture; or              

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      (c) modify any provisions relating to "-- Modification and Waiver"
  except to increase the percentage of outstanding Debt Securities of such
series required for such actions or to provide that certain other     
provisions of the Indenture cannot be modified or waived without the  
consent of the holder of each outstanding Debt Security of such series
affected thereby.                                                     

The holders of a majority in aggregate principal amount of the Debt   
Securities of any series outstanding may waive compliance with certain          
restrictive covenants and provisions of the Indenture with respect to such      
series.                                                                         

CONSOLIDATION, MERGER AND SALE OF ASSETS                                        

     The Company may not consolidate with or merge with or into any other person
or, directly or indirectly, convey, sell, assign, transfer, lease or otherwise  
dispose of its properties and assets substantially as an entirety to any other  
person (in one transaction or a series of related transactions), unless:        

       (a) either (i) the Company is the surviving corporation or (ii) the
 person (if other than the Company) formed by such consolidation or into
which the Company is merged or the person that acquires by sale,      
assignment, transfer, lease or other disposition of the properties and
     assets of the Company substantially as an entirety (the "Surviving Entity")
   (A) is a corporation, partnership or trust organized and validly existing
   under the laws of the United States, any state thereof or the District of
 Columbia and (B) expressly assumes, by a supplemental indenture in form
 satisfactory to the Trustee, all of the Company's obligations under the
Indenture and the Debt Securities;                                    

        (b) immediately after giving effect to such transaction and treating
     any obligation of the Company or a Restricted Subsidiary in connection with
   or as a result of such transaction as having been incurred as of the time
 of such transaction, no Default or Event of Default has occurred and is
continuing;                                                           

          (c) immediately after giving effect to such transaction on a pro forma
basis, the Consolidated Net Worth of the Company (or of the Surviving 
     Entity if the Company is not the continuing obligor under the Indenture) is
equal to or greater than the Consolidated Net Worth of the Company    
immediately prior to such transaction;                                

          (d) immediately after giving effect to such transaction on a pro forma
    basis (on the assumption that the transaction occurred at the beginning of
    the most recently ended four full fiscal quarter period for which internal
     financial statements are available, the Company (or the Surviving Entity if
    the Company is not the continuing obligor under the Indenture) could incur
     at least $1.00 of additional Debt (other than Permitted Debt (as defined in
     the Indenture)) pursuant to the first paragraph of any "Limitation on Debt"
covenant applicable to any series of Debt Securities;                 

     (e) if any of the property or assets of the Company or any of its
 Restricted Subsidiaries would thereupon become subject to any Lien, the
   provisions of any "Limitation on Liens" covenant applicable to any series
of Debt Securities are complied with; and                             

        (f) the Company delivers, or causes to be delivered, to the Trustee,
    in form and substance reasonably satisfactory to the Trustee, an officers'
   certificate and an opinion of counsel, each stating that such transaction
complies with the requirements of the Indenture.                      

In the event of any transaction described in and complying with the   
conditions listed in the first paragraph of this covenant in which the Company  
is not the continuing obligor under the Indenture, the Surviving Entity will    
succeed to, and be substituted for, and may exercise every right and power of,  
the Company under the Indenture, and thereafter the Company will be discharged  
from all its obligations and covenants under the Indenture and the Debt         
Securities.                                                                     

DEFEASANCE OR COVENANT DEFEASANCE OF INDENTURE                                  

 If the Prospectus Supplement relating to the offered Debt Securities so
provides, the Company may, at its option and at any time, terminate the         
obligations of the Company and any Subsidiary Guarantors with respect to the    
outstanding Debt Securities of any series ("defeasance"). Such defeasance means 
that the Company                                                                

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will be deemed to have paid and discharged the entire Debt represented by the   
outstanding Debt Securities of such series, except for (i) the rights of holders
of outstanding Debt Securities of such series to receive payments in respect of 
the principal of (and premium, if any, on) and interest on such Debt Securities 
when such payments are due, (ii) the Company's obligations to issue temporary   
Debt Securities of such series, register the transfer or exchange of any Debt   
Securities of such series, replace mutilated, destroyed, lost or stolen Debt    
Securities of such series, maintain an office or agency for payments in respect 
of the Debt Securities of any series and segregate and hold such payments in    
trust, (iii) the rights, powers, trusts, duties and immunities of the Trustee   
and (iv) the defeasance provisions of the Indenture. In addition, the Company   
may, at its option and at any time, elect to terminate the obligations of the   
Company and any Subsidiary Guarantor with respect to certain covenants set forth
in the Indenture, and any failure to comply with such obligations would not     
constitute a Default or an Event of Default with respect to the Debt Securities 
of such series ("covenant defeasance").                                         

In order to exercise either defeasance or covenant defeasance, (a) the
Company must irrevocably deposit or cause to be deposited with the Trustee, as  
trust funds in trust, specifically pledged as security for, and dedicated solely
to, the benefit of the holders of the Debt Securities of a series, money in an  
amount, or U.S. Government Obligations (as defined in the Indenture) that       
through the scheduled payment of principal and interest thereon will provide    
money in an amount, or a combination thereof, sufficient, in the opinion of a   
nationally recognized firm of independent public accountants, to pay and        
discharge the principal of (and premium, if any, on) and interest on the        
outstanding Debt Securities of such series at maturity (or upon redemption, if  
applicable) of such principal or installment of interest; (b) no Default or     
Event of Default has occurred and is continuing on the date of such deposit or, 
insofar as an event of bankruptcy under clause (g) of "Events of Default" above 
is concerned, at any time during the period ending on the 91st day after the    
date of such deposit; (c) such defeasance or covenant defeasance may not result 
in a breach or violation of, or constitute a default under, the Indenture or any
material agreement or instrument to which the Company or any Subsidiary         
Guarantor is a party or by which it is bound; (d) in the case of defeasance, the
Company must deliver to the Trustee an opinion of counsel stating that the      
Company has received from, or there has been published by, the U.S. Internal    
Revenue Service a ruling, or there has been a change in applicable federal      
income tax law, to the effect, and based thereon such opinion must confirm that,
the holders of the outstanding Debt Securities of such series will not recognize
income, gain or loss for federal income tax purposes as a result of such        
defeasance and will be subject to federal income tax on the same amounts, in the
same manner and at the same times as would have been the case if such defeasance
had not occurred; (e) in the case of covenant defeasance, the Company must have 
delivered to the Trustee an opinion of counsel to the effect that the Holders of
the outstanding Debt Securities of such series will not recognize income, gain  
or loss for federal income tax purposes as a result of such covenant defeasance 
and will be subject to federal income tax on the same amounts, in the same      
manner and at the same times as would have been the case if such covenant       
defeasance had not occurred; and (f) the Company must have delivered to the     
Trustee an officers' certificate and an opinion of counsel, each stating that   
all conditions precedent provided for relating to either the defeasance or the  
covenant defeasance, as the case may be, have been complied with.               

GOVERNING LAW                                                                   

     The Indenture and the Debt Securities will be governed by, and construed in
accordance with, the laws of the State of New York.                             

REGARDING THE TRUSTEE                                                           

 The Indenture contains certain limitations on the right of the Trustee,
should it become a creditor of the Company, to obtain payment of claims in      
certain cases, or to realize for its own account on certain property received in
respect of any such claim as security or otherwise. The Trustee will be         
permitted to engage in certain other transactions; however, if it acquires any  
conflicting interest and there is a default under the Debt Securities, it must  
eliminate such conflict or resign.                                              

    The Trustee may resign or be removed with respect to one or more series of
Debt Securities and a successor Trustee may be appointed to act with respect to 
such series. In the event that two or more persons                              

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are acting as Trustee with respect to different series of Debt Securities, each 
such Trustee shall be a Trustee of a trust under the Indenture separate and     
apart from the trust administered by any other such Trustee, and any action     
described herein to be taken by the "Trustee" may then be taken by each such    
Trustee with respect to, and only with respect to, the one or more series of    
Debt Securities for which it is Trustee.                                        

DESCRIPTION OF WARRANTS 

    The Company may issue Warrants for the purchase of Debt Securities, Common
Stock, Preferred Stock or any combination thereof. Warrants may be issued       
independently, together with any other Securities offered by a Prospectus       
Supplement, and may be attached to or separate from such Securities. Warrants   
may be issued under warrant agreements (each, a "Warrant Agreement") to be      
entered into between the Company and a warrant agent specified in the applicable
Prospectus Supplement (the "Warrant Agent"). The Warrant Agent will act solely  
as an agent of the Company in connection with the Warrants of a particular      
series and will not assume any obligation or relationship of agency or trust for
or with any holders or beneficial owners of Warrants. The following sets forth  
certain general terms and provisions of the Warrants offered hereby. Further    
terms of the Warrants and the applicable Warrant Agreement will be set forth in 
the applicable Prospectus Supplement.                                           

The applicable Prospectus Supplement will describe the terms of the   
Warrants in respect of which this Prospectus is being delivered, including,     
where applicable, the following: (i) the title of such Warrants; (ii) the       
aggregate number of such Warrants; (iii) the price or prices at which such      
Warrants will be issued; (iv) the designation, number and terms of the Debt     
Securities, Common Stock, Preferred Stock, Depositary Shares or combination     
thereof, purchasable upon exercise of such Warrants; (v) the designation and    
terms of the other Securities, if any, with which such Warrants are issued and  
the number of such Warrants issued with each such Security; (vi) the date, if   
any, on and after which such Warrants and the related underlying Securities will
be separately transferable; (vii) the price at which each underlying Security   
purchasable upon exercise of such Warrants may be purchased; (viii) the date on 
which the right to exercise such Warrants shall commence and the date on which  
such right shall expire; (ix) the minimum amount of such Warrants which may be  
exercised at any one time; (x) information with respect to book-entry           
procedures, if any; (xi) a discussion of any applicable federal income tax      
considerations; and (xii) any other terms of such Warrants, including terms,    
procedures and limitations relating to the transferability, exchange and        
exercise of such Warrants.                                                      

PLAN OF DISTRIBUTION

The Company may sell Securities to or through underwriters or dealers,
directly to other purchasers, or through agents. The Prospectus Supplement with 
respect to any Securities will set forth the terms of the offering of the       
Securities, including the name or names of any underwriters, dealers or agents, 
the price of the offered Securities and the net proceeds to the Company from    
such sale, any underwriting discounts or other items constituting underwriters' 
compensation, any discounts or concessions allowed or reallowed or paid to      
dealers and any national securities exchanges on which such Securities may be   
listed.                                                                         

  If underwriters are used 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 negotiated transactions, at a fixed public  
price or at varying prices determined at the time of sale. The underwriter or   
underwriters with respect to a particular underwritten offering of Securities   
will be named in the Prospectus Supplement relating to such offering, and if an 
underwriting syndicate is used, the managing underwriter or underwriters will be
set forth on the cover of such Prospectus Supplement. Unless otherwise set forth
in the Prospectus Supplement, the obligations of the underwriters or agents to  
purchase the Securities will be subject to certain conditions precedent and the 
underwriters will be obligated to purchase all the Securities if any are        
purchased. Any initial public offering price and any discounts or concessions   
allowed or reallowed or paid to dealers may be changed from time to time.       

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   If a dealer is utilized in the sale of any Securities in respect of which
this Prospectus is delivered, the Company will sell such Securities to the      
dealer, as principal. The dealer may then resell such Securities to the public  
at varying prices to be determined by such dealer at the time of resale. The    
name of the dealer and the terms of the transaction will be set forth in the    
Prospectus Supplement relating thereto.                                         

     Securities may be sold directly by the Company to one or more institutional
purchasers, or through agents designated by the Company from time to time, at a 
fixed price, or prices, which may be changed, or at varying prices determined at
the time of sale. Any agent involved in the offer or sale of the Securities will
be named, and any commissions payable by the Company to such agent will be set  
forth, in the Prospectus Supplement relating thereto. Unless otherwise indicated
in the Prospectus Supplement, any such agent will be acting on a best efforts   
basis for the period of its appointment.                                        

   In connection with the sale of the Securities, underwriters or agents may
receive compensation from the Company or from purchasers of Securities for whom 
they may act as agents in the form of discounts, concessions, or commissions.   
Underwriters, agents, and dealers participating in the distribution of the      
Securities may be deemed to be underwriters, and any discounts or commissions   
received by them from the Company and any profit on the resale of the Securities
by them may be deemed to be underwriting discounts or commissions under the     
Securities Act.                                                                 

  Unless otherwise specified in the applicable Prospectus Supplement, each
series of Securities, other than the Common Stock, will be a new issue with no  
established trading market. Any shares of Common Stock sold pursuant to a       
Prospectus Supplement will be listed on the NYSE subject to official notice of  
issuance. The Company may elect to list any series of the Securities on an      
exchange, but it is not obligated to do so. Any underwriters to whom Securities 
are sold by the Company for public offering and sale may make a market in such  
Securities, but such underwriters will not be obligated to do so and may        
discontinue any market making at any time without notice. No assurance can be   
given as to the liquidity of the trading market for any Securities.             

    Under agreements entered into with the Company, underwriters, dealers, and
agents may be entitled to indemnification by the Company against certain civil  
liabilities, including liabilities under the Securities Act, or to contribution 
with respect to payments that such agents, dealers, or underwriters may be      
required to make with respect thereto. Underwriters, dealers, or agents and     
their associates may be customers of, engage in transactions with and perform   
services for, the Company in the ordinary course of business.                   

   If so indicated in the applicable Prospectus Supplement, the Company will
authorize underwriters or other persons acting as the Company's agents to       
solicit offers by certain institutions to purchase Securities from the Company  
pursuant to contracts providing for payment and delivery on a future date.      
Institutions with which such contracts may be made include commercial and       
savings banks, insurance companies, pension funds, investment companies,        
educational and charitable institutions and others, but in all cases such       
institutions must be approved by the Company. The obligations of any purchaser  
under any such contract will be subject to the condition that the purchase of   
the Securities shall not at the time of delivery be prohibited under the laws of
the jurisdiction to which such purchaser is subject. The underwriters and such  
other agents will not have any responsibility in respect in respect of the      
validity or performance of such contracts.                                      

In order to comply with the securities laws of certain states, if     
applicable, the Securities offered hereby will be sold in such jurisdictions    
only through registered or licensed brokers or dealers. In addition, in certain 
states Securities may not be sold unless they have been registered or           
qualification requirement is available and is complied with.                    

   Under applicable rules and regulations under the Exchange Act, any person
engaged in the distribution of Securities offered hereby may not engage in      
market making activities with respect to the Securities for a period of two     
business days prior to the commencement of such distribution.                   

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EXPERTS 

The financial statements and the related financial statement schedules
included and incorporated in this Prospectus and elsewhere in the Registration  
Statement by reference from the Company's Annual Report on Form 10-K for the    
year ended June 30, 1997, as amended, have been audited by Deloitte & Touche    
LLP, independent auditors, as stated in their report, which is included and     
incorporated herein by reference, and have been so included and incorporated in 
reliance upon the report of such firm given upon their authority as experts in  
accounting and auditing.                                                        

LEGAL MATTERS 

    Certain legal matters, including the legality of the Securities covered by
this Prospectus, will be passed upon for the Company by Rogers & Wells LLP, New 
York, New York.                                                                 

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PART II 

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14.  OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION                           

The following table sets forth the costs and expenses, other than     
underwriting discounts and commissions, to be paid by the Registrant in         
connection with the sale of Securities being registered. All amounts are        
estimates except the Securities and Exchange Commission filing fee.             

                                                                [Download Table]
                                                                        
Securities and Exchange Commission Registration Fee.........  $  147,500
Printing and Engraving......................................     200,000
Accounting Fees.............................................     125,000
Legal Fees and Expenses.....................................     350,000
Blue Sky Fees and Expenses..................................      15,000
Rating Agencies Fees........................................      80,000
Miscellaneous Fees and Expenses.............................     125,000
                                                              ----------
          Total.............................................  $1,042,500
                                                              ==========

ITEM 15.  INDEMNIFICATION OF DIRECTORS AND OFFICERS                             

   Section 145(a) of the DGCL provides, in general, that a corporation shall
have power to indemnify any person who was or is a party or is threatened to be 
made a party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action  
by or in the right of the corporation), by reason of the fact that he is or was 
a director or officer of the corporation. Such indemnity may be against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement    
actually and reasonably incurred in connection with such action, suit or        
proceeding, if the indemnitee acted in good faith and in a manner reasonably    
believed to be in or not opposed to the best interests of the corporation, and  
with respect to any criminal action or proceeding, the indemnitee must not have 
had reasonable cause to believe his conduct was unlawful.                       

   Section 145(b) of the DGCL provides, in general, that a corporation shall
have power to indemnify any person who was or is a party or is threatened to be 
made a party to any threatened, pending or completed action or suit by or in the
right of the corporation to procure a judgment in its favor by reason of the    
fact that he is or was a director or officer of the corporation against expenses
(including attorney's fees) actually and reasonably incurred by him in          
connection with the defense or settlement of such action or suit if he acted in 
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the corporation.                                              

 Section 145(g) of the DGCL provides in general that a corporation shall
have power to purchase and maintain insurance on behalf of any person who is or 
was a director or officer of the corporation against any liability asserted     
against and incurred by him in any such capacity, or arising out of his status  
as such, whether or not the corporation would have the power to indemnify him   
against such liability under the provisions of the law.                         

The Company's By-laws require the Company to indemnify each of its    
directors, officers and employees to the fullest extent permitted by law in     
connection with any actual or threatened action or proceeding arising out of his
service to the Company or to other organizations at the Company's request.      

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ITEM 16.  EXHIBITS                                                              

(a) Exhibits                                                                

                                                                [Download Table]
                                                                            
 1.1****   --   Form of Underwriting Agreement (for Common Stock, Preferred 
                Stock and Depositary Shares)                                
 1.2****   --   Form of Underwriting Agreement (for Debt Securities)        
 1.3****   --   Form of Underwriting Agreement (for Warrants)               
 3.1*      --   Certificate of Incorporation of the Company                 
 3.2*      --   By-Laws of the Company                                      
 4.1**     --   Indenture for Debt Securities dated January 27, 1997 between
                the Company and the Trustee                                 
 4.2****   --   Form of Debt Securities                                     
 4.3*      --   Specimen of stock certificate for DVI's Common Stock, par   
                value $.005 per share                                       
 4.4****   --   Form of specimen certificate representing Preferred Stock   
 4.5****   --   Form of Warrant                                             
 5.1***    --   Opinion of Rogers & Wells LLP                               
23.1***    --   Consent of Rogers & Wells LLP (Included in Exhibit 5.1)     
23.2***    --   Consent of Deloitte & Touche LLP                            
25.1*****  --   Statement of Eligibility and Qualification on Form T-1 of   
                Trustee under the Indenture                                 

---------------                                                                 
   * Filed as an Exhibit to the Company's Registration Statement on Form S-3
(Registration No. 33-84604) and incorporated herein by reference. 

** Filed as an Exhibit to the Company's Current Report on Form 8-K dated  
January 30, 1997 and incorporated herein by reference.              

*** Filed herewith.                                                         

**** To be filed by amendment, by incorporation by reference or by filing of a
     Current Report on Form 8-K in connection with the offering of Securities.

***** Filed as an Exhibit to the Company's Registration Statement on Form S-3   
(Registration No. 333-17097) and incorporated herein by reference.  

(b) Financial Statements                                                    

Inapplicable.                                                         

ITEM 17.  UNDERTAKINGS                                                          

The undersigned registrant hereby undertakes:                         

     (1) To file, during any period in which offers or sales are being
    made, a post-effective amendment to this registration statement to include
any material information with respect to the plan of distribution not 
   previously disclosed in the registration statement or any material change
in the information set forth in the registration statement.           

    (2) That, for the purpose of determining any liability under the
    Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered 
   therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.                         

          (3) To remove from registration by means of a post-effective amendment
   any of the securities being registered which remain at the termination of
the offering.                                                         

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The undersigned registrant hereby undertakes that, for purposes of    
determining any liability under the Securities Act of 1933, each filing of the  
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the    
Securities Exchange Act of 1934 that is incorporated by reference in the        
registration statement shall be deemed to be a new registration statement       
relating to the securities offered therein, and the offering of such securities 
at that time shall be deemed to be the initial bona fide offering thereof.      

     Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the  
registrant pursuant to the registrant's Certificate of Incorporation, By-laws,  
or otherwise, the registrant has been advised that in the opinion of the        
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification 
against such liabilities (other than the payment by the registrant of expenses  
incurred or paid by a director, officer or controlling person of the registrant 
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being 
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate     
jurisdiction the question whether such indemnification by it is against public  
policy as expressed in the Act and will be governed by the final adjudication of
such issue.                                                                     

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SIGNATURES

    Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the    
requirements for filing on Form S-3 and has duly caused this Registration       
Statement to be signed on its behalf by the undersigned, thereunto duly         
authorized, in the City of Doylestown, State of Pennsylvania on April 23, 1998. 

             DVI, INC.

                                  By:    /s/ MICHAEL A. O'HANLON
                                            ------------------------------------
                                 Name: Michael A. O'Hanlon
                                      Title: Chief Executive Officer

KNOW ALL MEN BY THESE PRESENTS, that we, the undersigned officers and 
directors of DVI, Inc. hereby severally constitute Michael A. O'Hanlon and      
Steven R. Garfinkel and each of them singly, our true and lawful attorneys with 
full power to them, and each of them singly, to sign for us and in our names in 
the capacities indicated below, the Registration Statement filed herewith and   
any and all amendments to said Registration Statement (including without        
limitation any amendments filed pursuant to Section 462(b) of the Securities Act
of 1933), and generally to do all such things in our names and in our capacities
as officers and directors to enable DVI, Inc. to comply with the provisions of  
the Securities Act of 1933, and all requirements of the Securities and Exchange 
Commission, hereby ratifying and confirming our signature as they may be signed 
by our said attorneys, or any of them, to said Registration Statement and any   
and all amendments thereto.                                                     

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS      
REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE    
CAPACITIES AND ON THE DATES INDICATED.                                          

                                                        [Enlarge/Download Table]

                     SIGNATURE                                     TITLE                   DATE     
                     ---------                                     -----                   ----     
                                                                                                    

              /s/ MICHAEL A. O'HANLON                Chief Executive Officer,         April 23, 1998
---------------------------------------------------  President and Director                         
                Michael A. O'Hanlon                                                                 

              /s/ STEVEN R. GARFINKEL                Senior Vice President and Chief  April 23, 1998
---------------------------------------------------  Financial Officer (Principal                   
                Steven R. Garfinkel                  Financial Officer)                             

                 /s/ JOHN P. BOYLE                   Vice President and Chief         April 23, 1998
---------------------------------------------------  Accounting Officer (Principal                  
                   John P. Boyle                     Accounting Officer)                            

                /s/ GERALD L. COHN                   Director                         April 23, 1998
---------------------------------------------------                                                 
                  Gerald L. Cohn                                                                    

              /s/ WILLIAM S. GOLDBERG                Director                         April 23, 1998
---------------------------------------------------                                                 
                William S. Goldberg                                                                 

                /s/ JOHN E. MCHUGH                   Director                         April 23, 1998
---------------------------------------------------                                                 
                  John E. McHugh                                                                    

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                                                                [Download Table]

                     SIGNATURE                                 TITLE       DATE     
                     ---------                                 -----       ----     
                                                                                    

                /s/ NATHAN SHAPIRO                   Director         April 23, 1998
---------------------------------------------------                                 
                  Nathan Shapiro                                                    

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EXHIBIT INDEX 

                                                                [Download Table]
                                                                            
 1.1****   --   Form of Underwriting Agreement (for Common Stock, Preferred 
                Stock and Depositary Shares)                                

 1.2****   --   Form of Underwriting Agreement (for Debt Securities)        
 1.3****   --   Form of Underwriting Agreement (for Warrants)               
 3.1*      --   Certificate of Incorporation of the Company                 
 3.2*      --   By-Laws of the Company                                      
 4.1**     --   Indenture for Debt Securities dated January 27, 1997 between
                the Company and the Trustee                                 
 4.2****   --   Form of Debt Securities                                     
 4.3*      --   Specimen of stock certificate for DVI's Common Stock, par   
                value $.005 per share                                       
 4.4****   --   Form of specimen certificate representing Preferred Stock   
 4.5****   --   Form of Warrant                                             
 5.1***    --   Opinion of Rogers & Wells LLP                               
23.1***    --   Consent of Rogers & Wells LLP (Included in Exhibit 5.1)     
23.2***    --   Consent of Deloitte & Touche LLP                            
25.1*****  --   Statement of Eligibility and Qualification on Form T-1 of   
                Trustee under the Indenture                                 

---------------                                                                 
   * Filed as an Exhibit to the Company's Registration Statement on Form S-3
(Registration No. 33-84604) and incorporated herein by reference. 

** Filed as an Exhibit to the Company's Current Report on Form 8-K dated  
January 30, 1997 and incorporated herein by reference.              

*** Filed herewith.                                                         

**** To be filed by amendment, by incorporation by reference or by filing of a
     Current Report on Form 8-K in connection with the offering of Securities.

***** Filed as an Exhibit to the Company's Registration Statement on Form S-3   
(Registration No. 333-17097) and incorporated herein by reference.  

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘S-3’ Filing		Date		First		Last			Other Filings
Filed on:		4/24/98		1
		4/23/98		31		32			S-8
		1/30/98		12
		12/31/97		3		11			10-Q
		10/29/97		4					8-K
		10/28/97		3					10-K405/A
		9/30/97		3					10-Q
		6/30/97		3		27			10-K405,  10-K405/A
		1/30/97		29		33
		1/27/97		29		33			8-K,  8A12BEF
		12/31/96		11					10-Q
		6/30/96		11					10-K
		6/30/95		8		11			10-K/A,  10-K405,  NT 10-K
		6/30/94		11					10-K405/A
		6/30/93		11
									List all Filings