Pricing Supplement No. 5 dated August 20, 2002 Rule 424(B)(3)
(To Prospectus dated November 13, 2001 File No. 333-72340
and Prospectus Supplement dated November 13, 2001)
Colgate-Palmolive Company
Medium-Term Notes - Floating Rate
Series E
We are hereby offering to sell Notes having the terms specified below to
you with the assistance of UBS Warburg LLC, Salomon Smith Barney Inc. and
Merrill Lynch, Pierce, Fenner & Smith Incorporated (the "Agents"), acting as
principal, at a fixed initial public offering price of 100% of the principal
amount.
Principal Amount: $50,966,000 Trade Date: August 20, 2002
Issue Price: 100% Original Issue Date: August 23, 2002
Initial Interest Rate: 1.47% Net Proceeds to Colgate: $50,456,340
Stated Maturity Date: August 22, 2042 Agent's Discount or Commission: $509,660
CUSIP Number: 194 16 QDD 9
Base Rate:
[ ] Certificate of Deposit Rate
[ ] CMT Rate
[ ] Commercial Paper Rate
[ ] Eleventh District Cost of Funds Rate
[ X ] LIBOR Telerate: Page 3750 [ ] LIBOR Reuters
[ ] Prime Rate
[ ] Treasury Rate
[ ] Other (see attached)
Interest Rate Reset Dates: February 22, May 22, August 22 and November 22 of
each year, commencing on November 22, 2002.
Interest Rate Reset Period: Quarterly
Interest Payment Dates: February 22, May 22, August 22 and November 22 of each
year, commencing on November 22, 2002.
Index Maturity: 3 month
Index Currency: US Dollars
Spread: -.30%
Spread Multiplier: N/A
Maximum Interest Rate: N/A
Minimum Interest Rate: N/A
Day Count Convention:
[ ] 30/360 for the period from ________ to ________
[ X ] Actual / 360 for the period from August 23, 2002 to August 22, 2042.
[ ] Actual / Actual for the period from to
------- ------
Redemption: The Notes may be redeemed at the option of Colgate prior to the stated maturity date. See
"Other Provisions - Optional Redemption" below.
Optional Repayment: The Notes may be repaid at the option of the holders prior to the stated maturity date. See
"Other Provisions - Optional Repayment" below.
Currency:
Specified Currency: US Dollars
Minimum Denomination: $1,000
Original Issue Discount: [ ] [ X ] No
Total amount of OID:
Yield to Maturity:
Initial Accrual Period:
Form: [ X ] Book-entry [ ] Certificated
[ X ] Other provisions:
Optional Redemption: Colgate may at its option elect to redeem the Notes, in whole or in part, in increments of
$1,000 or any multiple of $1,000, upon not less than 30 nor more than 60 days' prior written
notice to the holders, on August 22, 2032 or on any business day thereafter at the following
redemption prices corresponding to the periods set forth below (expressed as a percentage of
the principal amount of the Notes), together with any accrued interest to the redemption
date:
If Redeemed During
the 12-Month Period Commencing on: Redemption Price
--------------------------------- ----------------
August 22, 2032 105.00%
August 22, 2033 104.50
August 22, 2034 104.00
August 22, 2035 103.50
August 22, 2036 103.00
August 22, 2037 102.50
August 22, 2038 102.00
August 22, 2039 101.50
August 22, 2040 101.00
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August 22, 2041
and thereafter to maturity 100.50
Optional Repayment: Notwithstanding anything to the contrary contained in the Prospectus Supplement dated
November 13, 2001, the holders of the Notes may elect to cause Colgate to repurchase the
Notes, in whole or in part, in increments of $1,000 or any multiple of $1,000, upon not less
than 30 nor more than 60 days' prior written notice to Colgate, on August 22 of each of the
years set forth below, at the amounts corresponding to the years set forth below (expressed
as a percentage of the principal amount of the Notes), together with any accrued interest to
the repayment date:
Repayment Date Repayment Price
-------------- ---------------
August 22, 2003 98.00%
August 22, 2004 98.00
August 22, 2005 98.00
August 22, 2006 98.00
August 22, 2007 98.00
August 22, 2008 99.00
August 22, 2009 99.00
August 22, 2010 99.00
August 22, 2011 99.00
August 22, 2012 99.00
August 22, 2013 and
each third anniversary 100.00
thereafter to maturity
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The Agents have severally, and not jointly, agreed to purchase from us,
and we have agreed to sell to the Agents, the principal amount of Notes set
forth opposite their respective names.
Agent Principal Amount of Notes
----- -------------------------
UBS Warburg LLC $25,031,000
Salomon Smith Barney Inc. 15,935,000
Merrill Lynch, Pierce, Fenner & Smith
Incorporated 10,000,000
------------
Total $50,966,000
============
Use of Proceeds:
The net proceeds from the sale of the Notes will be used by Colgate to
retire commercial paper which was issued by Colgate for general corporate
purposes and working capital. As of August 20, 2002, Colgate's outstanding
commercial paper had a weighted average interest rate of 1.75% with maturities
ranging from 1 day to 59 days.
Certain United States Federal Income Tax Considerations:
The following discussion supplements the discussion contained in the
Prospectus Supplement dated November 13, 2001 under the heading "Certain
United States Federal Tax Considerations." Prospective purchasers of Notes are
advised to consult their own tax advisors with respect to tax matters relating
to the Notes.
Notes Used as Qualified Replacement Property.
Prospective investors seeking to treat the Notes as "qualified
replacement property" for purposes of Section 1042 of the Internal Revenue
Code of 1986, as amended (the "Code"), should be aware that Section 1042
requires the issuer to meet certain requirements in order for the Notes to
constitute qualified replacement property. In general, qualified replacement
property is a security issued by a domestic corporation that did not, for the
taxable year preceding the taxable year in which such security was purchased,
have "passive investment income" in excess of 25 percent of the gross receipts
of such corporation for such preceding taxable year (the "passive income
test"). For purposes of the passive income test, where the issuing corporation
is in control of one or more corporations or such issuing corporation is
controlled by one or more other corporations, all such corporations are
treated as one corporation (the "affiliated group") for the purposes of
computing the amount of passive investment income for purposes of Section
1042.
Colgate believes that less than 25 percent of its affiliated group's
gross receipts is passive investment income for the taxable year ending
December 31, 2001. In making this determination, Colgate has made certain
assumptions and used procedures which it believes are reasonable. Colgate
cannot give any assurance as to whether it will continue to meet the passive
income test. It is, in addition, possible that the Internal Revenue Service
may disagree with the manner in which Colgate has calculated the affiliated
group's gross receipts (including the characterization thereof) and passive
investment income and the conclusions reached herein.
The Notes are a new issue of securities with no established trading
market. No assurance can be given as to whether a trading market for the Notes
will develop or as to the liquidity of a trading market for the Notes. The
availability and liquidity of a trading market for the Notes will also be
affected by the degree to which purchasers treat the Notes as qualified
replacement property.
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Legal Matters:
Sidley Austin Brown & Wood LLP, New York, New York has acted as counsel
for the Agents in the offering of the Notes. Sidley Austin Brown & Wood LLP
from time to time renders legal services to Colgate and its affiliates.
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