SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: June 6, 1997 Date of Earliest Event Reported: May 30, 1997
FBL FINANCIAL GROUP, INC.
(Exact Name of Registrant as Specified in Its Charter)
Iowa
(State or Other Jurisdiction of Incorporation)
1-11917 42-1411715
(Commission File Number) (I.R.S. Employer Identification No.)
5400 University Avenue, West Des Moines, IA 50266
(Address of Principal Executive Offices) (Zip Code)
(515) 225-5400
(Registrant's Telephone Number, Including Area Code)
ITEM 5. Other Events.
On May 30, 1997, FBL Financial Group, Inc. (the "Company") participated
in the sale of $100 million of trust securities issued by FBL Financial Group
Capital Trust (the "Trust"), a newly created subsidiary business trust of the
Company. The trust securities will pay cumulative cash distributions at an
annual rate of 5%, payable quarterly beginning June 30, 1997. The entire issue
of $97 million of trust preferred securities was acquired by the Company's
majority shareholder, the Iowa Farm Bureau Federation, while the Company
acquired $3 million of trust common securities.
The sole purpose of the Trust is to issue its securities and invest the
proceeds in an equivalent amount of 5% Subordinated Deferrable Interest Notes
("Subordinated Notes") issued by the Company. The Subordinated Notes will mature
on June 30, 2047 (the "Stated Maturity Date").
Simultaneously, the Company purchased from the Iowa Farm Bureau
Federation for $100 million an outstanding issue of 5,000,000 voting shares of
Series A Preferred Stock with a liquidation value of $100 million, and sold to
the Iowa Farm Bureau Federation 5,000,000 voting shares of a new Series B
Preferred Stock with a liquidation value of $3 million. Both the Series A
Preferred Stock and Series B Preferred Stock pay annual dividends of 5% of the
liquidation value.
So long as no event of default with respect to the Subordinated Notes
has occurred and is continuing, the Company has the right to defer payments of
interest on the Subordinated Notes at any time and from time to time for a
period not exceeding 20 consecutive quarterly periods with respect to each
deferral period (each, an "Extension Period"), provided that no Extension Period
may extend beyond the Stated Maturity Date. Upon the termination of any such
Extension Period and the payment of all amounts then due, the Company may elect
to begin a new Extension Period, subject to certain requirements. If and for so
long as interest payments on the Subordinated Notes are so deferred,
distributions on the Capital Securities also will be deferred and the Company
will not be permitted, subject to certain exceptions, to declare or pay any cash
distributions with respect to the Company's capital stock (which includes Class
A Common Stock, Class B Common Stock and Preferred Stock) or to make any payment
with respect to debt securities of the Company that rank pari passu with or
junior to the Subordinated Notes. During an Extension Period, interest on the
Subordinated Notes will continue to accrue (and the amount of distributions to
which holders of the trust securities are entitled will continue to accumulate)
at the rate of 5% per annum.
The Company has guaranteed the Trust's obligations under the Capital
Securities.
The Trust Preferred Securities will be subject to mandatory redemption,
in whole but not in part, on the Stated Maturity Date upon repayment of the
Subordinated Notes at a redemption price equal to the principal amount of the
Subordinated Notes, plus accrued and unpaid interest.
The trust preferred securities have not been registered under the
Securities Act of 1993, as amended (the "Act"), and may not be offered or resold
in the United States without registration under, or an applicable exemption from
the registration requirements of the Act and applicable state securities laws.
ITEM 7. Financial Statements and Exhibits.
7(c) Exhibits
1 Preferred Securities Purchase Agreement dated May 30, 1997
between FBL Financial Group Capital Trust, FBL Financial
Group, Inc. and the Iowa Farm Bureau Federation.
3.1 Certificate of Designations of Series B Preferred Stock of FBL
Financial Group, Inc., dated and effective May 30, 1997.
4.2 Certificate of Trust.
4.3 Declaration of Trust of FBL Financial Group Capital Trust
dated May 30, 1997, including in Annex I thereto the form of
Trust Preferred Security and the form of Trust Common
Security.
4.4. Subordinated Deferrable Interest Note Agreement dated May 30,
1997 between FBL Financial Group, Inc. and FBL Financial Group
Capital Trust, including therein the form of Subordinated
Deferrable Interest Note.
4.5 Preferred Securities Guarantee Agreement of FBL Financial
Group, Inc. dated May 30, 1997.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
FBL FINANCIAL GROUP, INC.
Date: June 6, 1997 By /s/ James W. Noyce
James W. Noyce
Chief Financial Officer
EXHIBIT INDEX
Exhibit No. Description
----------- -----------
1 Preferred Securities Purchase Agreement dated May 30, 1997
between FBL Financial Group Capital Trust, FBL Financial
Group, Inc. and the Iowa Farm Bureau Federation.
3.1 Certificate of Designations of Series B Preferred Stock of FBL
Financial Group, Inc., dated and effective May 30, 1997.
4.2 Certificate of Trust.
4.3 Declaration of Trust of FBL Financial Group Capital Trust
dated May 30, 1997, including in Annex I thereto the form of
Trust Preferred Security and the form of Trust Common
Security.
4.4. Subordinated Deferrable Interest Note Agreement dated May 30,
1997 between FBL Financial Group, Inc. and FBL Financial Group
Capital Trust, including therein the form of Subordinated
Deferrable Interest Note.
4.5 Preferred Securities Guarantee Agreement of FBL Financial
Group, Inc. dated May 30, 1997.
EXHIBIT 1
May 30, 1997
PREFERRED SECURITIES PURCHASE AGREEMENT
Iowa Farm Bureau Federation
5400 University Avenue
West Des Moines, IA 50266
Ladies and Gentlemen:
FBL Financial Group Capital Trust (the "Trust"), a statutory business
trust organized under the Business Trust Act (the "Delaware Act") of the State
of Delaware (Chapter 38, Title 12, of the Delaware Code, 12 Del. C. Sections
3801 et seq.) pursuant to the Declaration of Trust dated as of May 30, 1997 (the
"Declaration") among FBL Financial Group, Inc., an Iowa corporation (the
"Company" and, together with the Trust, the "Offerors"), the Trustees as defined
therein and the holders, from time to time, of undivided beneficial interests in
the assets of the Trust, confirm their agreement with Iowa Farm Bureau
Federation (the "Purchaser"), with respect to the issue and sale by the Trust
and the purchase by the Purchaser of $97,000,000 in aggregate liquidation amount
of 5% Preferred Securities (Liquidation Amount $1,000 per Security) representing
undivided beneficial interests in the assets of the Trust (the "Preferred
Securities"). Capitalized terms used herein and not otherwise defined herein
shall have the meanings assigned such terms in the Declaration.
The Preferred Securities will be guaranteed by the Company, with
respect to distributions and amounts payable upon liquidation or redemption and
otherwise pursuant to the Preferred Securities Guarantee Agreement dated as of
May 30, 1997 (the "Preferred Securities Guarantee").
The entire proceeds from the sale of the Preferred Securities will be
combined with the entire proceeds from the sale by the Trust to the Company of
its common securities (the "Common Securities") and will be used by the Trust to
purchase $100,000,000 in aggregate principal amount of 5% Subordinated
Deferrable Interest Notes due June 1, 2047 (the "Subordinated Notes") issued by
the Company. The Preferred Securities and the Common Securities will be issued
pursuant to the Declaration. The Subordinated Notes will be issued and dated as
of May 30, 1997.
The Preferred Securities, the Preferred Securities Guarantee and the
Subordinated Notes are collectively referred to herein as the Preferred
Instruments.
The Declaration, Preferred Securities Guarantee and this Agreement are
hereinafter referred to collectively as the "Operative Documents."
The Preferred Securities are offered and sold to the Purchaser without
being registered under the 1933 Act, in reliance upon exemptions therefrom, and
Purchaser may only resell or otherwise transfer such Preferred Securities if
such Preferred Securities are hereafter registered under the 1933 Act or if an
exemption from the registration requirements of the 1933 Act is available.
SECTION 1. Representations and Warranties.
(a) The Offerors jointly and severally represent and warrant to the
Purchaser as of the date hereof and as of the Closing Time referred to in
Section 2(b) hereof, and agree with the Purchaser as follows:
(i) The Offerors have not, directly or indirectly, solicited
any offer to buy or offered to sell, and will not, directly or
indirectly, solicit any offer to buy or offer to sell, in the
United States or to any United States citizen or resident, any
security which is or would be integrated with the sale of the
Preferred Securities in a manner that would require the
Preferred Securities to be registered under the 1933 Act.
(ii) The Company maintains a system of internal accounting
controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's
authorization; and (ii) assets are safeguarded and
transactions are recorded to permit preparation of financial
statements in conformity with generally accepted accounting
principles and, as of the Closing Time, the Company will
continue to maintain such a system.
(iii) The audited consolidated financial statements, together
with the related schedules and notes thereto for the years
ended December 31, 1996 and 1995, together with the unaudited
consolidated financial statements for the quarters ended March
31, 1997 and March 31, 1996, present fairly in all material
respects the financial position of the Company and its
Subsidiaries (as defined below) at the dates indicated and the
consolidated statement of income, stockholders' equity and
cash flows of the Company and its Subsidiaries for the periods
specified; said consolidated financial statements have been
prepared in conformity with generally accepted accounting
principles ("GAAP") applied on a consistent basis throughout
the periods involved except as noted therein.
(iv) Since the date as of the most recent Financial Statement,
and except as otherwise described or stated therein, (A) there
has been no material adverse change and no development which
could reasonably be expected to result in a material adverse
change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Trust
(a "Trust Material Adverse Effect") or the Company and its
Subsidiaries (as defined below) considered as one enterprise
(a "Company Material Adverse Effect," together with a Trust
Material Adverse Effect, a "Material Adverse Effect"), whether
or not arising in the ordinary course of business, (B) there
have been no transactions entered into by the Trust or the
Company or any of its Subsidiaries which are material with
respect to the Trust or the Company and its Subsidiaries
considered as one enterprise, other than those in the ordinary
course of business and (C) there has not been any material
change in the long term debt of the Company.
(v) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of
the State of Iowa, with corporate power and authority to own,
lease and operate its properties and to conduct its business
as presently conducted, to enter into and perform its
obligations under each of the Operative Documents, to hold the
Common Securities issued by the Trust, to issue and to deliver
the Preferred Instruments; and the Company is duly qualified
as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure
to so qualify or be in good standing would not have a Company
Material Adverse Effect.
(vi) Each of the corporations of which a majority of the
outstanding voting equity securities are owned, directly or
indirectly, by the Company ("Subsidiaries") has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own,
lease and operate its properties and to conduct its business
as presently conducted, and is duly qualified as a foreign
corporation to transact business and is in good standing in
each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure to so
qualify or be in good standing will not have a Company
Material Adverse Effect.
(vii) The authorized, issued and outstanding capital stock of
the Company is as set forth in the most recent Financial
Statements, since the date of which there has been no change
in the consolidated capitalization of the Company and its
Subsidiaries (other than changes in outstanding Common Stock
resulting from stock option plan transactions and the
purchase by the Company of 965,370 shares of Class A Common
purchased from various stockholders on April 4, 1997); and all
of the issued and outstanding capital stock of the Company has
been duly authorized and validly issued and is fully paid and
non-assessable.
(viii) Each Subsidiary of the Company which is engaged in the
business of insurance or reinsurance (collectively, the
"Insurance Subsidiaries"), holds such insurance licenses,
certificates and permits from governmental authorities
(including, without limitation, from the insurance regulatory
agencies of the various jurisdictions where it conducts
business (the "Insurance Licenses")) as are necessary to the
conduct of its business; each Insurance Subsidiary has
fulfilled and performed all obligations necessary to maintain
the Insurance Licenses; there is no pending or, to the
knowledge of the Company, threatened action, suit, proceeding
or investigation that could reasonably be expected to result
in the revocation, termination or suspension of any Insurance
License; and no insurance regulatory agency or body has
issued, or commenced any proceeding for the issuance of, any
order or decree impairing, restricting or prohibiting the
payment of dividends by any Insurance Subsidiary to its
parent.
(ix) The Insurance Subsidiaries have made no material changes
in their insurance reserving practices since the most recent
audited Financial Statements.
(x) All reinsurance treaties and arrangements to which any
Insurance Subsidiary is a party are in full force and effect
and no Insurance Subsidiary is in violation of or in default
in the performance, observance or fulfillment of, any
obligation, agreement, covenant or condition contained
therein, except to the extent any such violation or default
would not have a material adverse effect on such Insurance
Subsidiary, no Insurance Subsidiary has received any notice
from any of the other parties to such treaties, contracts or
agreements that such other party intends not to perform such
treaty and, to the best knowledge of the Company and the
Insurance Subsidiaries, the Company and the Insurance
Subsidiaries have no reason to believe that any of the other
parties to such treaties or arrangements will be unable to
perform such treaty or arrangement except to the extent
adequately and properly reserved for in the consolidated
financial statements of the Company.
(xi) The statutory financial statements of the Insurance
Subsidiaries from which certain ratios and other statistical
data have been derived, have for each relevant period been
prepared in conformity with statutory accounting principles or
practices required or permitted by the National Association of
Insurance Commissioners and by the appropriate Insurance
Department of the jurisdiction of domicile of each Insurance
Subsidiary, and such statutory accounting practices have been
applied on a consistent basis throughout the periods involved,
except as may otherwise be indicated therein or in the notes
thereto, and present fairly the statutory financial position
of the Insurance Subsidiaries as of the dates thereof, and the
statutory basis results of operations of the Insurance
Subsidiaries for the periods covered thereby.
(xii) The Trust has been duly created and is validly existing
and in good standing as a business trust under the Delaware
Act with the power and authority to own its properties and to
conduct its business and to enter into and perform its
obligations under this Agreement, the Preferred Securities,
the Common Securities, and the Declaration; the Trust is duly
qualified to transact business and is in good standing in each
jurisdiction in which such qualification is necessary, except
to the extent that the failure to so qualify or be in good
standing would not have a material adverse effect; the Trust
is not a party to or otherwise bound by any agreement not
previously disclosed to Purchaser; the Trust is and will under
current law be classified for United States federal income tax
purposes as a grantor trust and not as an association taxable
as a corporation; and as of the Closing Time the Trust is and
will be treated as a subsidiary of the Company pursuant to
generally accepted accounting principles.
(xiii) The Common Securities have been duly authorized by the
Declaration and, when issued and delivered by the Trust to the
Company against payment therefor, will be validly issued and
will represent undivided common beneficial interests in the
assets of the Trust; the issuance of the Common Securities is
not subject to preemptive or other similar rights; and, at the
Closing Time, all of the issued and outstanding Common
Securities of the Trust will be directly or indirectly owned
by the Company, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equitable right.
(xiv) This Agreement has been duly authorized and at the
Closing Time will have been duly executed and delivered by the
Company and the Trust.
(xv) The Declaration has been duly authorized by the Company
and, at the Closing Time, will have been duly executed and
delivered by the Company and the Administrative Trustees and
assuming the due authorization, execution and delivery of the
Declaration by the Delaware Trustee, the Declaration will, at
the Closing Time, be a valid and binding obligation of the
Company and the Administrative Trustees, enforceable against
the Company and the Administrative Trustees in accordance with
its terms, except to the extent that enforcement thereof may
be limited by bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other similar laws
affecting creditors' rights generally or by general principles
of equity (regardless of whether enforcement is considered in
a proceeding at law or in equity) (the "Bankruptcy
Exceptions").
(xvi) The Preferred Securities have been duly authorized by
the Declaration and, when issued and delivered by the Trust to
the Purchaser pursuant to this Agreement against payment
therefore as provided herein, will be validly issued and fully
paid and nonassessable undivided beneficial interests in the
assets of the Trust; the issuance of the Preferred Securities
is not subject to preemptive or other similar rights; and
(subject to the terms of the Declaration) holders of Preferred
Securities will be entitled to the same limitation of personal
liability extended to stockholders of private corporations for
profit incorporated under the laws of the State of Delaware.
(xvii) The Preferred Securities Guarantee has been duly
authorized by the Company and, at the Closing Time, the
Preferred Securities Guarantee will have been duly executed
and delivered by the Company and will constitute valid and
biding obligations of the Company, enforceable against the
Company in accordance with its terms, except to the extent
that enforcement thereof may be limited by the Bankruptcy
Exceptions.
(xviii) The issuance and delivery of the Subordinated Notes
have been duly authorized by the Company and, at the Closing
Time, the Subordinated Notes will have been duly executed by
the Company and, when delivered against payment therefor, will
constitute valid and binding obligations of the Company.
(xix) Subordinated Notes are subordinate and junior in right
of payment to all Senior Indebtedness (as defined in the
Subordinated Notes) of the Company.
(xx) Each of the Administrative Trustees of the Trust is an
officer of the Company and has been duly authorized by the
Company to execute and deliver the Declaration.
(xxi) None of the Offerors is an "investment company" or a
"company controlled" by an "investment company" within the
meaning of the Investment Company Act of 1940, as amended (the
"1940 Act").
(xxii) None of the Company, any Subsidiary or the Trust is in
violation of its articles of incorporation, bylaws,
certificate or declaration of trust, as applicable, or in
default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other
agreement or instrument to which it is a party or by which it
may be bound or to which any of its properties or assets may
be subject, except for such violations or defaults that would
not have a Material Adverse Effect. The execution and delivery
of the Operative Documents, the issuance and delivery of the
Preferred Instruments and the consummation of the transactions
contemplated herein and therein have been duly authorized by
all necessary corporate or other action on the part of the
Company and the Trust and do not and will not result in any
violation of the articles of incorporation or by-laws of the
Company or any Subsidiary nor any violation of the
Declaration, and do not and will not conflict with, or result
in a breach of any of the terms or provisions of, or
constitute a default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any
property or assets of the Company, the Trust or any Subsidiary
under (A) any contract, indenture, mortgage, loan agreement,
note, lease or other agreement or instrument to which the
Company, the Trust or any Subsidiary is a party or by which it
may be bound or to which any of its properties or assets may
be subject (except that would not have a Material Adverse
Effect) or (B) any existing applicable law, rule, regulation,
judgment, order or decree of any government, governmental
instrumentality or court, domestic or foreign, having
jurisdiction over the Company, the Trust or any Subsidiary or
any of their respective properties or assets.
(xxiii) No order, license, consent, authorization or approval
of, or exemption by, or the giving of notice to, or the
registration with any federal, state, municipal or other
governmental department, commission, board, bureau, agency or
instrumentality, and no filing, recording, publication or
registration in any public office or any other place, was or
is now required in connection with the issuance and sale of
the Preferred Instruments hereunder, except for (A) such as
may be required under the 1933 Act, the 1934 Act or state
securities or insurance laws and (B) the filing of the
Certificate of Trust with the Secretary of State (which filing
has been duly made).
(xxiv) None of the Company, its affiliates (as such term is
defined in Rule 501(b) under the 1933 Act for any person or
entity, ("Affiliates"), or any person acting on its or any of
their behalf (other than the Purchaser or any person acting on
behalf of the Purchaser, as to whom the Company makes no
representation) has engaged, or will engage, in connection
with the offering of the Preferred Securities, in any
communication or other form of general solicitation or general
advertising within the meaning of Section 502(c) under the
1993 Act.
(xxv) Subject to compliance by the Purchaser with the
representations and warranties set forth in Section 2 and the
procedures set forth in Section 6, it is not necessary in
connection with the offer, sale and delivery of the Preferred
Securities to the Purchaser in the manner contemplated by this
Agreement to register the Preferred Securities under the 1933
Act.
(b) Any certificate signed by any trustee of the Trust or any officer
of the Company and delivered to the Purchaser or to counsel for the Purchaser
shall be deemed a representation and warranty by the Trust or the Company as the
case may be, to the Purchaser as to the matters covered thereby.
SECTION 2. Sale and Delivery to Purchaser; Closing.
(a) On the basis of the representations and warranties herein contained
and subject to the terms and conditions herein set forth, the Trust agrees to
sell to the Purchaser and the Purchaser agrees to purchase from the Trust 97,000
of the Preferred Securities at a price of $1,000 per Preferred Security.
(b) Deliveries of the certificates for the account of the Purchaser for
the Preferred Securities shall be made at the office of the Company set forth in
Section 6. Payment for the Preferred Securities shall be made by the Purchaser
to the Trust by transfer of immediately available funds contemporaneous with
closing at such place as shall be agreed upon by the Purchaser and the Offerors,
at 3:00 p.m. (Iowa time) on May 30, 1997 or such other time not later than ten
business days after such date as shall be agreed upon by the Purchaser and the
Offerors (such time and date of payment and delivery being herein called the
"Closing Time").
(c) Subject to the provisions of the Declaration, certificates for the
Preferred Securities shall be in such denominations and registered in such names
as the Purchaser may request in writing at least one Business Day before the
Closing Time.
SECTION 3. Conditions of Purchaser's Obligations.
The obligations of the Purchaser hereunder are subject to the accuracy
of the representations and warranties of the Offerors contained in Section 1
hereof or in certificates of any Trustee of the Trust, officer of the Company or
any of its subsidiaries delivered pursuant to the provisions hereof, to the
performance by the Offerors of their obligations hereunder, and to the following
further conditions:
(a) At the Closing Time the Purchaser shall have received:
(i) One Hundred Million Dollars ($100,000,000) as the proceeds
to it from the sale by it to the Company of 5,000,000 shares
of the Series A Preferred Stock of the Company, and 5,000,000
shares of Series B Preferred Stock of the Company sold to the
Purchaser at a purchase price of $3,000,000.
(ii) The favorable opinion, dated as of the Closing Time, of
Davis, Brown, Koehn, Shors & Roberts, P.C., counsel for the
Company, in form and substance satisfactory to Purchaser, to
the effect that;
(A) The Company has been duly incorporated and is
validly existing under the laws of the State of Iowa.
(B) All legally required proceedings in connection
with the authorization, issuance and validity of the
Preferred Securities and the sale of the Preferred
Securities in accordance with this Agreement (other
than the filing of post-issuance reports, the
non-filing of which would not render the Preferred
Securities invalid) have been taken and all legally
required orders, consents or other authorizations or
approvals of any other public boards or bodies in
connection with the authorization, issuance and the
sale of the Preferred Securities in accordance with
this Agreement (other than in connection with or in
compliance with the provisions of the securities or
Blue Sky laws of any jurisdictions, as to which no
opinion need be expressed) have been obtained and are
in full force and effect.
(C) The Preferred Securities Guarantee has been duly
authorized by the Company, has been duly executed and
delivered by the Company and, constitutes a valid and
binding obligation of the Company, enforceable
against the Company in accordance with its terms,
except to the extent that enforcement thereof may be
limited by Bankruptcy Exceptions.
(D) The issuance and delivery of the Subordinated
Notes have been duly authorized by the Company and
the Subordinated Notes have been duly executed and
delivered by the Company and, when delivered against
payment therefor, constitutes the valid and binding
obligations of the Company, enforceable against the
Company in accordance with their terms, except to the
extent that enforcement thereof may be limited by the
Bankruptcy exceptions.
(E) The execution, delivery and performance of the
Operative Documents and the issuance and delivery of
the Preferred Securities, the Preferred Instruments
and the consummation of the transactions contemplated
herein and therein; and the compliance by each of the
Offerors with their respective obligations hereunder
and thereunder do not and will not conflict with,
result in a breach of, or constitute a default under
the Articles of Incorporation or by-laws of the
Company or any of its Subsidiaries or the terms of
any indenture or other agreement or instrument known
to such counsel and to which the Company or an of its
Subsidiaries is a party or bound, or result in a
violation of any statute or regulation, or any order
or decree known to such counsel to be applicable to
the Company or any of its Subsidiaries of any court,
regulatory body, administrative agency, governmental
body or arbitrator having jurisdiction over the
Company or any of its Subsidiaries.
(F) In rendering such opinion, such counsel may rely
(A) as to matters involving the application of laws
other than the laws of Iowa and the federal law of
the United States, to the extent they deem proper and
specified in such opinion, upon the opinion of other
counsel of good standing whom they believe to be
reliable and who are satisfactory to counsel for the
Purchaser and (B) as to matters of Delaware Law, upon
the opinion of Richards, Layton & Finger, P.A.,
special Delaware counsel to the Offerors (or other
Delaware counsel acceptable to Purchaser).
(iii) The favorable opinion, dated as of the Closing Time, of
Delaware counsel acceptable to Purchaser in form and substance
satisfactory to Purchaser, to the effect that:
(A) The Trust has been duly created and is validly
existing in good standing as a business trust under
the Delaware Act, and all filings required under the
laws of the State of Delaware with respect to the
creation and valid existence of the Trust as a
business trust have been made.
(B) The Declaration constitutes a valid and binding
obligation of the Company and the Trustees and is
enforceable against the Company and the Trustees in
accordance with its terms, subject, as to
enforcement, to (i) bankruptcy, insolvency,
moratorium, receivership, reorganization,
liquidation, fraudulent conveyance and other similar
laws relating to or affecting the rights and remedies
of creditors generally, (ii) principles of equity,
including applicable law relating to fiduciary duties
(regardless of whether considered and applied in a
proceeding in equity or at law), and (iii) the effect
of applicable public policy on the enforceability of
provisions relating to indemnification and
contribution.
(C) Under the Delaware Act and the Declaration, the
Trust has the power and authority to execute and
deliver, and to perform its obligations as described
in the Declaration.
(D) Delivery by the Trust of this Agreement, and the
performance by the Trust of its obligations
hereunder, have been duly authorized by all necessary
action on the part of the Trust.
(E) The certificates for the Preferred Securities are
in due and proper form, the Preferred Securities have
been duly authorized by the Declaration and, when
delivered to and paid for by the Purchaser in accord
with the terms of the Declaration and this Agreement,
will be duly and validly issued and, subject to
qualifications hereinafter expressed in this
paragraph (vi), fully paid and nonassessable
undivided beneficial interests in the assets of the
Trust, the holders of the Preferred Securities, as
beneficial owners of the Trust, will be entitled to
the same limitation of personal liability extended to
stockholders of private corporations for profit
organized under the General Corporation Law of the
State of Delaware; said counsel may note that the
holders of the Preferred Securities may be obligated
to make payments as set forth in the Declaration.
(F) The Common Securities have been duly authorized
by the Declaration and, when delivered and paid for
by the Company in accordance with the terms of the
Declaration duly and validly issued and represent
undivided beneficial interests in the assets of the
Trust.
(G) Under the Delaware Act and the Declaration, the
issuance of the Preferred Securities is not subject
to preemptive rights.
(H) The issuance and sale by the Trust of the
Preferred Securities and Common Securities, the
purchase by the Trust of the Subordinated Notes, the
execution, delivery and performance by the Trust of
this Agreement, the consummation by the Trust of the
transactions contemplated hereby and compliance by
the Trust with its obligations hereunder will not
violate (i) any of the provisions of the Certificate
of Trust or the Declaration or (ii) any applicable
Delaware law or administrative regulation.
(iv) The opinion of Davis, Brown, Koehn, Shors & Roberts,
P.C., special tax counsel to the Offerors, based on current
law and the assumptions stated or referred to therein, that
(i) the Notes will be classified for United States federal
income tax purposes as indebtedness of the Company, and (ii)
the Trust will be classified for United States federal income
tax purposes as a grantor trust and not as an association
taxable as a corporation. Such opinion may be conditioned on,
among other things, the initial and continuing accuracy of the
facts, financial and other information, covenants and
representations set forth in certificates of officers of the
Company and the Trust and other documents deemed necessary for
such opinion.
(v) The favorable opinion, dated as of Closing Time, of
Morain, Burlingame & Pugh, P.L.C., counsel to the Purchaser,
with respect to such matters as the Purchaser may require. In
giving its opinion, Morain, Burlingame & Pugh, P.L.C. may rely
as to certain matters of Iowa and Delaware law upon the
opinions of Davis, Brown, Koehn, Shors & Roberts, P.C. and
Richards, Layton & Finger, P.A., counsel for the Offerors,
which shall be delivered in accordance with Section (a)(ii)
and (a)(iii) hereof
(b) At the Closing Time there shall not have been, since the date
hereof, any material adverse change, or any development or event involving a
prospective material adverse change, in the condition, financial or otherwise,
or in the earnings, business affairs or business prospects of the Trust, or the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, and the Purchaser shall have
received a certificate of an executive officer of the Company, and a certificate
of an Administrative Trustee of the Trust, dated as of the closing Time, to the
effect that, (i) there has been no such material adverse change or development
or event, (ii) the representations and warranties in Section 1 hereof are true
and correct with the same force and effect as though expressly made at and as of
the Closing Time, and (iii) the Offerors have complied with all agreements and
satisfied all conditions on their part to be performed or satisfied at or prior
to the Closing Time.
(c) If any condition specified in this Section 5 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Purchaser by notice to the Offerors at any time at or prior to Closing
Time, and such termination shall be without liability of any party to any other
party except as provided in Section 4 and except that Section 6 shall survive
any such termination and remain in full force and effect.
SECTION 6. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or trustees of the Trust
submitted pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Purchaser or
controlling person, or by or on behalf of the Trust or Company, and shall
survive delivery of the Preferred Securities to the Purchaser.
SECTION 7. Termination of Agreement
(a) Termination; General. The Purchaser may terminate this Agreement by
notice to the Offerors at any time at or prior to the Closing Time (i) if there
has occurred any material adverse change in the financial markets in the United
States or any outbreak of hostilities or escalation thereof or other calamity or
crisis the effect of which is such as to make it, in your judgment,
impracticable to issue or buy the Preferred Securities, or (ii) if trading in
any securities of the Company has been suspended by the Commission or the New
York Stock Exchange, or if trading generally on either the American Stock
Exchange or the New York Stock Exchange or in the over-the-counter market has
been suspended, or minimum or maximum prices for trading have been fixed, or
maximum ranges for prices for securities have been required, by any of such
exchange or such system or by order of the Commission or any other governmental
authority or (iii) if a banking moratorium has been declared by either federal,
New York, Delaware or Iowa authorities, (iv) if there has been, since the date
hereof, any material adverse change in the condition, financial or otherwise, or
in the earnings, business affairs or business prospects of the Trust or the
Company and its Subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business. Either party may terminate this
Agreement if there has been or appears that there has been a change in
applicable tax laws materially affecting the anticipated tax consequences of
this Agreement.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 3 hereof, and provided further that Section
1 shall survive such termination and remain in full force and effect.
SECTION 8. Notices
All notices and other communications hereunder shall be in writing and
shall be deemed to have been duly given if mailed or transmitted by any standard
form of telecommunication. Notices to the Purchaser shall be directed to the
Purchaser at 5400 University Avenue, West Des Moines, Iowa 50266, attention of
Richard D. Harris, Secretary-Treasurer; notices to the Offerors shall be
directed to the Company at 5400 University Avenue, West Des Moines, Iowa 50266,
attention, Thomas R. Gibson, Chief Executive Officer.
SECTION 9. Parties.
This Agreement shall be binding upon and shall inure to the benefit of
the Purchaser and the Offerors and their respective successors and assigns and
their heirs and legal representatives.
SECTION 10. Governing Law and Time.
This Agreement shall be governed by and construed in accordance with
the laws of the State of Iowa applicable to agreements made and to be performed
in said State. Specified times of day refer to Iowa time unless otherwise
indicated.
SECTION 11. Effect of Headings.
The Article and Section headings herein are for convenience only and
shall not affect the construction hereof.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding Agreement
between the Purchaser and the Offerors in accordance with its terms.
Very truly yours,
FBL FINANCIAL GROUP, INC.
By: /s/ William J. Oddy
---------------------------------
Title: Chief Operating Officer
------------------------------
FBL FINANCIAL GROUP CAPITAL TRUST
By /s/ Stephen M. Morain
----------------------------------
Initial Administrative Trustee
CONFIRMED AND ACCEPTED as of the date first above written:
IOWA FARM BUREAU FEDERATION
By /s/ Edward M. Wiederstein, President
-------------------------- ---------
(Title)
EXHIBIT 3.1
ARTICLES OF AMENDMENT
CERTIFICATE OF DESIGNATIONS
SERIES B CUMULATIVE VOTING PREFERRED STOCK
OF
FBL FINANCIAL GROUP, INC.
Pursuant to Section 490.602 of the Iowa Code (1995)
RESOLVED, that pursuant to the authority vested in the Board of Directors of FBL
Financial Group, Inc. (the "Company") in accordance with the provisions of its
Restated Articles of Incorporation, a series of Preferred Stock of the Company,
be and hereby is, authorized to be issued with voting powers, designations,
preferences, and other special rights, qualifications, limitations and
restrictions as follows:
1. Designation and Amount; Restricted Transfer Issue.
(a) The shares of this series of Preferred Stock shall be
designated as Series B Cumulative Voting Preferred Stock with
no par value (hereinafter referred to as "Series B Preferred
Stock") and the number of shares constituting this series
shall be five million (5,000,000).
(b) Shares of Series B Preferred Stock shall be initially issued
only to a Farm Bureau organization as defined in Section 9
hereof. In the event any shares of Series B Preferred Stock
shall, as a result of any transfer or otherwise, cease to be
beneficially owned, directly or indirectly by a Farm Bureau
organization, the shares of Series B Preferred Stock ceasing
to be so owned shall immediately and without any further
action by the Company or the holder thereof, become subject to
redemption by the Company, at the option of the Company,
pursuant to Section 5 hereof. Certificates representing shares
of Series B Preferred Stock shall be legended to reflect such
right of redemption.
2. Dividends and Distributions.
(a) Subject to the provision for adjustment hereinafter set forth,
the holders of shares of Series B Preferred Stock shall be
entitled to receive, when, as and if declared by the Board of
Directors of the Company out of funds legally available
therefor, cumulative cash dividends ("Series B Dividends") in
an amount per share equal to Three Cents ($.03) per share per
annum, payable quarterly, one-fourth on the last day of March,
June, September and December (each a "Dividend Payment Date"),
to holders of record at the start of business on such Dividend
Payment Date. In the event that any Dividend Payment Date
shall fall on any day other than a business day, the dividend
payment due on such Dividend Payment Date shall be paid on the
business day immediately preceding such Dividend Payment Date.
Series B Dividends shall begin to accrue on outstanding shares
of Series B Preferred Stock from the date of issuance of such
shares of Series B Preferred Stock. Series B Dividends shall
accrue on a daily basis whether the Company shall have
earnings or surplus at the time. Series B Dividends accrued
for any period less than a full quarterly period shall be
computed on the basis of a 360-day year of 30-day months.
Accrued but unpaid Series B Dividends shall cumulate as of the
Dividend Payment Date on which they first become payable, but
no interest shall accrue on accumulated but unpaid Series B
Dividends.
(b) So long as any Series B Preferred Stock shall be outstanding,
no dividend shall be declared or paid or set apart for payment
on any other series of stock ranking on a parity with the
Series B Preferred Stock as to dividends, unless there shall
also be or have been declared or paid or set apart for payment
on the Series B Preferred Stock, dividends for all dividend
payment periods of the Series B Preferred Stock ending on or
before the dividend payment date of such parity stock, ratably
in proportion to the respective amounts of dividends
accumulated and unpaid through such dividend payment period of
the Series B Preferred Stock and accumulated and unpaid or
payable on such parity stock through the dividend payment
period on such parity stock next preceding such dividend
payment date. In the event that full cumulative dividends on
the Series B Preferred Stock have not been declared and paid
or set apart for payment when due, the Company shall not
declare or pay or set apart for payment any dividends or make
any other distributions on, or make any payment on account of
the purchase, redemption or other retirement of, any other
class of stock or series thereof of the Company ranking, as to
dividends or as to distributions in the event of a
liquidation, dissolution or winding-up of the Company, junior
to the Series B Preferred Stock until full cumulative
dividends on the Series B Preferred Stock shall have been
declared and paid or set apart for payment; provided, however,
that the foregoing shall not apply to (i) any dividend payable
solely in any shares of stock ranking, as to dividends or as
to distributions in the event of a liquidation, dissolution or
winding-up of the Company, junior to the Series B Preferred
Stock, or (ii) the acquisition of shares of any stock ranking,
as to dividends or as to distributions in the event of a
liquidation, dissolution or winding-up of the Company, junior
to the Series B Preferred Stock either (A) pursuant to any
employee or director incentive or benefit plan or arrangement
(including any employment, severance or consulting agreement)
of the Company or any subsidiary of the Company heretofore or
hereafter adopted or (B) in exchange solely for shares of any
other stock ranking junior to the Series B Preferred Stock.
3. Voting Rights. The holders of the shares of Series B Preferred Stock
shall have the following voting rights:
(a) The holders of Series B Preferred Stock shall, if the holder
is a Farm Bureau organization as defined in Section 9 hereof,
be entitled to vote on all matters submitted to a vote of the
holders of Class A Common Stock of the Company, voting
together with the holders of Class A Common Stock as one
class. Each share of the Series B Preferred Stock shall be
entitled to one vote, adjusted as provided in Section 9
hereof. Notwithstanding the preceding provisions of this
paragraph 3(a), the voting rights of the Series B Preferred
Stock specified in this paragraph 3(a) shall terminate
automatically in the event such Series B Preferred Stock shall
cease to be beneficially owned directly or indirectly, by a
Farm Bureau organization as defined in Section 9 hereof, with
respect to the shares ceasing to be so owned.
(b) Except as otherwise required by the Iowa Business Corporation
Act or set forth herein, holders of Series B Preferred Stock
shall have no special voting rights as a separate voting group
and their consent shall not be required (except to the extent
they are entitled to vote with holders of Class A Common Stock
as set forth herein) for the taking of any corporate action;
provided, however, that the vote of at least a majority of the
outstanding shares of Series B Preferred Stock, voting as a
separate voting group, shall be necessary to adopt any
alteration, amendment or repeal of any provision of the
Restated Articles of Incorporation of the Company, as amended,
or this certificate (including any such alteration, amendment
or repeal effected by any merger or consolidation in which the
Company is the surviving or resulting corporation) if such
amendment, alteration or repeal would alter or change the
powers, preferences or special rights of the shares of Series
B Preferred Stock so as to affect them adversely.
4. Liquidation, Dissolution or Winding-up.
(a) Upon any voluntary or involuntary liquidation, dissolution or
winding-up of the Company, the holders of shares of Series B
Preferred Stock shall be entitled to receive out of the assets
of the Company which remain after the debts or obligations of
the Company have been paid and which are available for payment
to stockholders and subject to the rights of the holders of
stock of the Company ranking senior to or on a parity with the
Series B Preferred Stock in respect of distributions upon
liquidation, dissolution or winding-up of the Company, before
any amount shall be paid or distributed among the holders of
Common Stock or any other shares ranking junior to the Series
B Preferred Stock in respect of distributions upon
liquidation, dissolution or winding-up of the Company,
liquidating distributions in cash in the amount of Sixty Cents
($.60) per share, plus an amount in cash equal to all accrued
and unpaid dividends thereon to the date fixed for
distribution. If upon any liquidation, dissolution or
winding-up of the Company, the amounts payable with respect to
the Series B Preferred Stock and any other stock ranking as to
any such distribution on a parity with the Series B Preferred
Stock are not paid in full, the holders of the Series B
Preferred Stock and such other stock shall share ratably in
any distribution of assets in proportion to the full
respective preferential amounts to which they are entitled.
After payment of the full amount to which they are entitled as
provided by the foregoing provisions of this paragraph 4(a),
the holders of shares of Series B Preferred Stock shall not be
entitled to any further right or claim to any of the remaining
assets of the Company.
(b) Neither the merger or consolidation of the Company with or
into any other corporation, nor the merger or consolidation of
any other corporation with or into the Company, nor the sale,
transfer, exchange or lease of all or any portion of the
assets of the Company, shall be deemed to be a dissolution,
liquidation or winding-up of the affairs of the Company for
purposes of this Section 4, but the holders of Series B
Preferred Stock shall nevertheless be entitled in the event of
any such merger or consolidation to the rights provided by
Section 6 hereof.
(c) Written notice of any voluntary or involuntary liquidation,
dissolution or winding-up of the Company, stating the payment
date or dates when, and the place or places where, the amounts
distributable to holders of Series B Preferred Stock in such
circumstances shall be payable, shall be given by first-class
mail, postage prepaid, mailed not less than twenty (20) days
prior to any payment date stated therein, to the holders of
shares of Series B Preferred Stock at the address shown on the
books of the Company or any transfer agent for the Series B
Preferred Stock.
5. Redemption at the Option of the Company.
(a) Any shares of Series B Preferred Stock ceasing to be
beneficially owned, directly or indirectly, by a Farm Bureau
organization, shall be redeemable, in whole or in part, out of
funds legally available therefor, at the option of the Company
at any time after the date they ceased to be so owned by a
Farm Bureau organization, at the price of Sixty Cents ($0.60)
per share plus an amount equal to all accrued and unpaid
dividends thereon to the date fixed for redemption (the
"Redemption Price").
(b) On and after the date when less than Ten Percent (10%) of the
Class A Common Stock of the Company is owned, directly or
indirectly, by a Farm Bureau organization, any shares of
Series B Preferred Stock shall be redeemable, in whole or in
part, out of funds legally available therefor, at the option
of the Company at any time at the Redemption Price.
(c) Unless otherwise required by law, notice of redemption will be
sent to the holders of Series B Preferred Stock at the address
shown on the books of the Company or any transfer agent for
the Series B Preferred Stock by first class mail, postage
prepaid, mailed not less than twenty (20) days nor more than
sixty (60) days prior to the redemption date. Each such notice
shall state: (i) the redemption date; (ii) the total number of
shares of the Series B Preferred Stock to be redeemed and, if
fewer than all the shares held by such holder are to be
redeemed, the number of such shares to be redeemed from such
holder; (iii) the Redemption Price; (iv) the place or places
where certificates for such shares are to be surrendered for
payment of the Redemption Price; and (v) that dividends on the
shares to be redeemed will cease to accrue on such redemption
date. Upon the date fixed for redemption, the Company shall
set aside cash funds having a value equal to the aggregate
Redemption Price for the shares of Series B Preferred Stock to
be redeemed. Payment of the Redemption Price shall be made by
the Company within five (5) days after the date fixed for
redemption upon surrender of the certificates evidencing the
shares of Series B Preferred Stock so redeemed, properly
endorsed or assigned for transfer.
(d) From and after the date fixed for redemption, and provided the
Company shall have set aside funds sufficient to redeem the
shares, dividends on shares of Series B Preferred Stock called
for redemption will cease to accrue, such shares will no
longer be deemed to be outstanding and all rights in respect
of such shares of the Company shall cease, except the right to
receive the Redemption Price therefor, without interest, upon
surrender to the Company of the certificates evidencing such
shares, properly endorsed or assigned for transfer. If less
than all of the outstanding shares of Series B Preferred Stock
are to be redeemed, the Company shall redeem a portion of the
shares of each holder which is not a Farm Bureau organization
determined pro rata based on the number of shares held by each
such holder.
6. Consolidation, Merger, etc.
(a) In the event that the Company shall consummate any
consolidation or merger or similar transaction, however named,
pursuant to which the outstanding shares of Class A Common
Stock are by operation of law exchanged solely for or changed,
reclassified or converted solely into stock of any successor
or resulting company (including the Company), and, if
applicable, for a cash payment in lieu of fractional shares,
if any, the shares of Series B Preferred Stock shall be
assumed by and shall become preferred stock of such successor
or resulting company, having in respect of such company
insofar as possible the same powers, preferences and relative,
participating, optional or other special rights, and the
qualifications, limitations or restrictions thereon, that the
Series B Preferred Stock had immediately prior to such
transaction. The rights of the Series B Preferred Stock as
preferred stock of such successor or resulting company shall
successively be subject to adjustments pursuant to Section 7
hereto after any such transaction as nearly equivalent to the
adjustments provided for by such section prior to such
transaction. The Company shall not consummate any such merger,
consolidation or similar transaction unless all then
outstanding shares of the Series B Preferred Stock shall be
assumed and authorized by the successor or resulting company
as aforesaid.
(b) In the event the Company shall enter into any agreement
providing for any consolidation or merger or similar
transaction described in paragraph (a) of this Section 6, then
the Company shall as soon as practicable thereafter (and in
any event at least ten (10) business days before consummation
of such transaction) give notice of such agreement and the
material terms thereof to each holder of Series B Preferred
Stock and each such holder shall have the right to elect, by
written notice to the Company, to receive, upon consummation
of such transaction (if and when such transaction is
consummated), from the Company or the successor of the
Company, in redemption and retirement of such Series B
Preferred Stock, a cash payment equal to the amount payable in
respect of shares of Series B Preferred Stock at the
Redemption Price. No such notice of redemption shall be
effective unless given to the Company prior to the close of
business on the fifth business day prior to consummation of
such transaction, unless the Company or the successor of the
Company shall waive such prior notice, but any notice of
redemption so given prior to such time may be withdrawn by
notice of withdrawal given to the Company prior to the close
of business on the fifth business day prior to consummation of
such transaction.
7. Anti-dilution Voting Adjustments.
(a) In the event the Company shall, at any time or from time to
time while any of the shares of the Series B Preferred Stock
are outstanding, (i) pay any dividend or make a distribution
in respect of the Class A Common Stock in shares of Class A
Common Stock, (ii) subdivide the outstanding shares of Class A
Common Stock, or (iii) combine the outstanding shares of Class
A Common Stock into a smaller number of shares, in each case
whether by reclassification of shares, recapitalization of the
Company (including a recapitalization effected by a merger or
consolidation to which Section 6 hereof does not apply) or
otherwise, the voting rights of a share of Series B Preferred
Stock in effect immediately prior to such action shall be
adjusted by multiplying such voting right by a fraction, the
numerator of which is the number of shares of Class A Common
Stock outstanding immediately before such event and the
denominator of which is the number of shares of Class A Common
Stock outstanding immediately after such event. An adjustment
made pursuant to this paragraph 7(a) shall be given effect,
upon declaration of such a dividend or distribution, as of the
record date for the determination of shareholders entitled to
receive such dividend or distribution (on a retroactive basis)
and in the case of a subdivision or combination shall become
effective immediately as of the effective date thereof.
(b) Notwithstanding any other provisions of this Section 7, the
Company shall not be required to make any adjustment of the
voting rights of Series B Preferred Stock unless such
adjustment would require an increase or decrease of at least
one percent (1%) in the voting rights. Any lesser adjustment
shall be carried forward and shall be made no later than the
time of, and together with, the next subsequent adjustment
which, together with any adjustment or adjustments so carried
forward, shall amount to an increase or decrease of at least
one percent (1%) in the voting rights.
(c) If the Company shall make any dividend or distribution of the
Class A Common Stock or issue any Class A Common Stock, other
capital stock or other security of the Company or any rights
or warrants to purchase or acquire any such security, which
transaction does not result in an adjustment to the voting
rights pursuant to the foregoing provisions of this Section 7,
the Board of Directors of the Company shall consider whether
such action is of such a nature that an adjustment to the
voting rights should equitably be made in respect of such
transaction. If in such case the Board of Directors of the
Company determines that an adjustment to the voting rights
should be made, an adjustment shall be made effective as of
such date, as determined by the Board of Directors of the
Company. The determination of the Board of Directors of the
Company as to whether an adjustment to the voting rights of
the Series B Preferred Stock should be made pursuant to the
foregoing provisions of this paragraph 7(c), and, if so, as to
what adjustment should be made and when, shall be final and
binding on the Company and all stockholders of the Company.
(d) Whenever an adjustment to the voting rights of the Series B
Preferred Stock is required pursuant to this Resolution, the
Company shall forthwith place on file with the transfer agent
for the Class A Common Stock and the Series B Preferred Stock
if there be one, and with the Secretary of the Company, a
statement signed by two officers of the Company stating the
voting rights (as appropriately adjusted), of the Series B
Preferred Stock. Such statement shall set forth in reasonable
detail such facts as shall be necessary to show the reason and
the manner of computing such adjustment, including any
determination of Fair Market Value involved in such
computation. Promptly after each adjustment to the voting
rights of the Series B Preferred Stock, the Company shall mail
a notice thereof to each holder of shares of the Series B
Preferred Stock.
8. Ranking; Retirement of Shares.
(a) The Series B Preferred Stock shall rank senior to the Class A
Common Stock and the Class B Common Stock as to the payment of
dividends and the distribution of assets upon liquidation,
dissolution and winding-up of the Company, and, unless
otherwise provided in the Restated Articles of Incorporation
of the Company, or a Certificate of Designations relating to
any other series of preferred stock of the Company, the Series
B Preferred Stock shall rank on a parity with all other series
of the Company's Preferred Stock, as to the payment of
dividends and the distribution of assets on liquidation,
dissolution or winding-up.
(b) Any shares of Series B Preferred Stock acquired by the Company
by reason of the redemption of such shares as provided by this
Resolution, or otherwise so acquired, shall be retired as
shares of Series B Preferred Stock and restored to the status
of authorized but unissued shares of preferred stock of the
Company, undesignated as to series, and may thereafter be
reissued as part of a new series of such preferred stock as
permitted by law.
9. Definition of Farm Bureau Organization.
For purposes of this Resolution, "Farm Bureau organization" shall mean
(i) the American Farm Bureau Federation, an Illinois not for profit
corporation formed to promote agriculture and to correlate and
strengthen various state Farm Bureau federations, county Farm Bureau
federations and any other state organizations controlled by or under
common control with any of such federations; and (ii) the state Farm
Bureau federations, the county Farm Bureau federations, and all
corporations, partnerships, and other entities controlled by or under
common control with the American Farm Bureau Federation, any state Farm
Bureau federation, or any county Farm Bureau federation, or entity
authorized by the American Farm Bureau to use the trade-names, "Farm
Bureau" or "FB" in its name or operations.
10. Miscellaneous.
(a) All notices referred to herein shall be in writing, and all
notices hereunder shall be deemed to have been given upon the
earlier of receipt thereof or three (3) business days after
the mailing thereof if sent by registered mail (unless
first-class mail shall be specifically permitted for such
notice under the terms of this Resolution) with postage
prepaid, addressed: (i) if to the Company, to its office at
5400 University Avenue, West Des Moines, Iowa 50266
(Attention: Secretary) or other agent of the Company
designated as permitted by this Resolution, or (ii) if to any
holder of the Series B Preferred Stock or Class A Common
Stock, as the case may be, to such holder at the address of
such holder as listed in the stock record books of the Company
(which may include the records of any transfer agent for the
Series B Preferred Stock or Class A Common Stock, as the case
may be), or (iii) to such other address as the Company or any
such holder, as the case may be, shall have designated by
notice similarly given.
(b) The term "Class A Common Stock" as used in this Resolution
means the Company's no par value Class A Common Stock, as the
same exists at the date of filing of a Certificate of
Designations relating to the Series B Preferred Stock, or any
other class of stock resulting from successive changes or
reclassifications of such Class A Common Stock consisting
solely of changes in par value, or from par value to no par
value or from no par value to par value.
(c) The Company shall pay any and all stock transfer and
documentary stamp taxes that may be payable in respect of any
issuance or delivery of shares of Series B Preferred Stock or
certificates representing such shares or securities. The
Company shall not, however, be required to pay any such tax
which may be payable in respect of any transfer involved in
the issuance or delivery of shares of Series B Preferred Stock
in a name other than that in which the shares of Series B
Preferred Stock with respect to which such shares or other
securities are issued or delivered were registered, or in
respect of any payment to any person with respect to any such
shares or securities other than a payment to the registered
holder thereof, and shall not be required to make any such
issuance, delivery or payment unless and until the person
otherwise entitled to such issuance, delivery or payment has
paid to the Company the amount of any such tax or has
established, to the satisfaction of the Company, that such tax
has been paid or is not payable.
(d) Unless otherwise provided in the Restated Articles of
Incorporation of the Company, all payments in the form of
dividends, distributions on voluntary or involuntary
dissolution, liquidation or winding-up or otherwise made upon
the shares of Series B Preferred Stock and any other stock
ranking on a parity with the Series B Preferred Stock with
respect to such dividend or distribution shall be made pro
rata, so that amounts paid per share on the Series B Preferred
Stock and such other stock shall in all cases bear to each
other the same ratio that the required dividends,
distributions or payments, as the case may be, then payable
per share on the shares of the Series B Preferred Stock and
such other stock bear to each other.
(e) The Company may (but shall not be required to) appoint, and
from time to time discharge and change, a transfer agent for
the Series B Preferred Stock. Upon any such appointment or
discharge of a transfer agent, the Company shall send notice
thereof by first-class mail, postage prepaid, to each holder
of record of Series B Preferred Stock.
FURTHER RESOLVED, that the Chief Executive Officer, any Vice President, the
Secretary, or the Treasurer of the Company be, and hereby is, authorized for and
on behalf of the Company, to perform any and all acts and execute any and all
documents necessary or advisable to effectuate the foregoing Resolution.
3. The date of adoption of the amendment was May 30, 1997.
4. The amendment was duly adopted and approved by the board of
directors without shareholder approval, pursuant to Section
1002 of the Iowa Business Corporation Act.
5. This document is effective at the time of filing on the date
of filing as evidenced by the endorsement of the Iowa
Secretary of State.
FBL FINANCIAL GROUP, INC.
By /s/ William J. Oddy
----------------------------------------
William J. Oddy, Chief Operating Officer
EXHIBIT 4.2
CERTIFICATE OF TRUST
The undersigned, the trustees of FBL Financial Group Capital Trust,
desiring to form a business trust pursuant to Delaware Business Trust Act, 12
Del. C. Section 3810, hereby certify as follows:
1. The name of the business trust being formed hereby (the "Trust") is
"FBL Financial Group Capital Trust."
2. The name and business address of the trustee of the Trust which has
its principal place of business in the State of Delaware is as follows:
Delaware Trust Capital Management, Inc.
900 Market Street, 2nd Floor
Wilmington DE 19801
3. This Certificate of Trust shall be effective as of the date of
filing with the office of the Secretary of State of the State of Delaware.
IN WITNESS WHEREOF, the undersigned have executed this Certificate of
Trust as of the date written below.
Dated: May 28, 1997.
/s/ Stephen M. Morain
Stephen M. Morain, Trustee
DELAWARE TRUST CAPITAL
MANAGEMENT, INC.
By: /s/Richard N. Smith
Richard N. Smith, Vice President
EXHIBIT 4.3
DECLARATION OF TRUST
OF
FBL FINANCIAL GROUP CAPITAL TRUST
MAY 30, 1997
DECLARATION OF TRUST ("Declaration") dated and effective as of May 30,
1997, by the Trustees (as defined herein), the Sponsor (as defined herein) and
by the holders, from time to time, of undivided beneficial interests in the
assets of the Trust to be issued pursuant to this Declaration;
The Administrative Trustee (as defined herein), Delaware Trustee (as
defined herein), and the Sponsor hereby establish the FBL Financial Group
Capital Trust (the "Trust"), a trust created under the Business Trust Act
pursuant to this Declaration of Trust for the sole purpose of issuing and
selling certain securities representing undivided beneficial interests in the
assets of the Trust and investing the proceeds thereof in certain Notes of the
Issuer (each as hereinafter defined).
NOW, THEREFORE, it being the intention of the parties hereto to
establish the Trust as a business trust under the Business Trust Act and that
this Declaration constitute the governing instrument of such business trust, the
Trustees declare that all assets contributed to the Trust will be held in trust
for the benefit of the Trust and the Holders, from time to time, of the
securities representing undivided beneficial interests in the assets of the
Trust issued hereunder, subject to the provisions of this Declaration.
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1. Definitions.
Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration but not defined in the
preamble above have the respective meanings assigned to them in this Section
1.1;
(b) a term defined anywhere in the Declaration has the same meaning
throughout;
(c) all references to "the Declaration" or "this Declaration" are to
this Declaration as modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles and Sections and
Annexes and Exhibits are to Articles and Sections of and Annexes and Exhibits to
this Declaration unless otherwise specified;
(e) a reference to the singular includes the plural and vice versa.
"ADMINISTRATIVE TRUSTEE" has the meaning set forth in Article IV.
"AFFILIATE" has the same meaning as given to that term in Rule 405
under the Securities Act or any successor rule thereunder.
"AUTHORIZED OFFICER" of a Person means any Person that is authorized to
bind such Person.
"BUSINESS DAY" means any day other than a Saturday or a Sunday or a day
on which banking institutions in the City of Des Moines, Iowa or in the City of
Wilmington, Delaware are authorized or required by law or executive order to
close.
"BUSINESS TRUST ACT" means Chapter 38 of Title 12 of the Delaware Code,
12 Del. Code Section 3801 et seq., as it may be amended from time to time, or
any successor legislation.
"CLOSING TIME" means the "Closing Time" under the Purchase Agreement.
"CODE" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor legislation.
"COMMISSION" means the United States Securities and Exchange Commission
as from time to time constituted, or if any time after the execution of this
Declaration such Commission is not existing and performing the duties now
assigned to it under applicable Federal securities laws, then the body
performing such duties at such time.
"COMMON SECURITIES" has the meaning specified in Section 6.1(a).
"COMPANY" means the Note Issuer.
"COMPANY INDEMNIFIED PERSON" means (a) any Administrative Trustee; (b)
any Affiliate of any Administrative Trustee; (c) any officers, directors,
shareholders, members, partners, employees, representatives or agents of any
Administrative Trustee; or (d) any officer, employee or agent of the Trust or
its Affiliates.
"CORPORATE OFFICE" means, as of the date of this Declaration, 5400
University Avenue, West Des Moines, Iowa 50266.
"COVERED PERSON" means: (a) any officer, director, shareholder,
partner, member, representative, employee or agent of (i) the Trust or (ii) the
Trust's Affiliates; and (b) any Holder of Securities.
"DEFAULT" means an event, act or condition that with notice or lapse of
time, or both, would constitute an Event of Default.
"DELAWARE TRUSTEE" has the meaning set forth in Section 4.2.
"DIRECT ACTION" shall have the meaning set forth in Section 2.6(c).
"DISTRIBUTION" means a distribution payable to Holders in accordance
with Section 5.1 and Annex I.
"EVENT OF DEFAULT" in respect of the Securities mean an Event of
Default (as defined in the Note Agreement) which has occurred and is continuing
in respect of the Notes.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation.
"FIDUCIARY INDEMNIFIED PERSON" has the meaning set forth in Section
8.4(b).
"HOLDER" means a Person in whose name a Security is registered on the
register for the Securities, such Person being a beneficial owner within the
meaning of the Business Trust Act.
"INDEMNIFIED PERSON" means a Company Indemnified Person or a Fiduciary
Indemnified Person.
"INITIAL ADMINISTRATIVE TRUSTEE" has the meaning set forth in Section
4.1.
"INVESTMENT COMPANY" means an investment company as defined in the
Investment Company Act.
"INVESTMENT COMPANY ACT" means the Investment Company Act of 1940, as
amended from time to time, or any successor legislation.
"LEGAL ACTION" has the meaning set forth in Section 2.6(b)(v).
"LIKE AMOUNT" has the meaning set forth in Annex I hereto.
"NOTE ISSUER" means FBL Financial Group, Inc., an Iowa corporation, or
any successor entity including a successor entity resulting from any
consolidation, amalgamation, merger, sale of assets as an entirety or
substantially as an entirety, transfer, lease, or other business combination, in
its capacity as issuer of the Notes under the Indenture.
"NOTES" means the 5% Subordinated Deferrable Interest Notes due June 1,
2047 of the Note Issuer dated as of May 30, 1997.
"OFFICERS' CERTIFICATE" means, with respect to any Person (other than
Administrative Trustees who are natural persons or the Delaware Trustee who is a
natural person), a certificate signed by two Authorized Officers of such Person.
Any Officers' Certificate delivered with respect to compliance with a condition
or covenant provided for in this Declaration shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering
the Officers' Certificate;
(c) a statement that each such officer has made such
examination or investigation as, in such officer's opinion, is
necessary to enable such officer to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
provided, that the term "Officers' Certificate" when used with reference to
Administrative Trustees who are natural persons shall mean a certificate signed
by two of the Administrative Trustees which otherwise satisfies the foregoing
requirements.
"OPINION OF COUNSEL" shall mean a written opinion of counsel, who may
be an employee of the Sponsor, and who shall be, and which opinion shall be,
acceptable to the Administrative Trustees.
"PAYING AGENT" has the meaning specified in Section 6.3.
"PAYMENT AMOUNT" has the meaning specified in Section 5.1.
"PERSON" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"PREFERRED SECURITIES" has the meaning specified in Section 6.1(a).
"PREFERRED SECURITIES GUARANTEE" means the guarantee agreements of the
Sponsor dated May 31, 1997, in respect of the Preferred Securities.
"PURCHASE AGREEMENT" means the Purchase Agreement for the sale of
Preferred Securities dated as of May 31, 1997, among the Trust, the Company, and
the Iowa Farm Bureau Federation.
"QUORUM" means a majority of the Administrative Trustees or, if there
are only two Administrative Trustees, both of them.
"RELATED PARTY" means, with respect to the Sponsor, any direct or
indirect wholly owned subsidiary of the Sponsor or any other Person that owns,
directly or indirectly, 100% of the outstanding voting securities of the
Sponsor.
"RESTRICTED SECURITIES LEGEND" has the meaning set forth in Section
7.2(b).
"SECURITIES" or "TRUST SECURITIES" means the Common Securities and the
Preferred Securities.
"SECURITIES ACT" means the Securities Act of 1933, as amended from time
to time, or any successor legislation.
"SPONSOR" means FBL Financial Group, Inc., an Iowa corporation, or any
successor entity including a successor entity resulting from any merger,
consolidation, amalgamation, sale of assets as an entirety or substantially as
an entirety, transfer, lease or other business combination, in its capacity as
sponsor of the Trust.
"SUCCESSOR DELAWARE TRUSTEE" has the meaning set forth in Section
4.5(c)(ii).
"SUCCESSOR ENTITY" has the meaning specified in Section 2.11(b)(i).
"SUCCESSOR SECURITIES" has the meaning specified in 2.11(b)(i)(B).
"TREASURY REGULATIONS" means the income tax regulations.
"TRUSTEE ACCOUNT" the account described in Section 2.6(b)(xii).
ARTICLE II
ORGANIZATION
SECTION 2.1. Name.
The Trust formed hereby is named "FBL Financial Group Capital Trust" as
such name may be modified from time to time by the Administrative Trustees
following written notice to the Delaware Trustee and the Holders of Securities.
The Trust's activities may be conducted under the name of the Trust or any other
name deemed advisable by the Administrative Trustees.
SECTION 2.2. Office.
The address of the principal office of the Trust is c/o FBL Financial
Group, Inc., 5400 University Avenue, West Des Moines, Iowa 50266. On ten
Business Days written notice to the Holders of Securities (with a copy to the
Delaware Trustee), the Administrative Trustees may designate another principal
office.
SECTION 2.3. Purpose.
(a) The exclusive purposes and functions of the Trust are (a) to issue
and sell Securities, (b) use the proceeds from the sale of the Securities to
acquire the Notes, and (c) except as otherwise limited herein, to engage in only
those other activities necessary, advisable or incidental thereto. The Trust
shall not borrow money, issue debt or reinvest proceeds derived from
investments, mortgage or pledge any of its assets, or otherwise undertake or
permit to be undertaken any activity that would cause the Trust not to be
classified for United States federal income tax purposes as a grantor trust.
(b) The Trust will be classified as a grantor trust for United States
federal income tax purposes under Subpart E of Subchapter J of the Code,
pursuant to which the owners of the Preferred Securities and the Common
Securities will be the owners of the Trust for United States federal income tax
purposes, and such owners will include directly in their gross income the
income, gain, deductions or loss of the Trust as if the Trust did not exist. By
the acceptance of this Trust, none of the Trustees, the Sponsor, the Holders of
the Preferred Securities or Common Securities or the Preferred Securities
Beneficial Owners will take any position for United States federal income tax
purposes which is contrary to the classification of the Trust as a grantor
trust.
SECTION 2.4. Authority.
Subject to the limitations provided in this Declaration, the
Administrative Trustees shall have exclusive and complete authority to carry out
the purposes of the Trust. An action taken by the Administrative Trustees in
accordance with their powers shall constitute the act of and serve to bind the
Trust. In dealing with the Trustees acting on behalf of the Trust, no Person
shall be required to inquire into the authority of the Trustees to bind the
Trust. Persons dealing with the Trust are entitled to rely conclusively on the
power and authority of the Trustees as set forth in this Declaration. The
Trustees shall file a Certificate of Trust with the Office of the Secretary of
State of the State of Delaware pursuant to Section 3810 of the Business Trust
Act.
SECTION 2.5. Title to Property of the Trust.
Except as otherwise provided in this Declaration, legal title to all
assets of the Trust shall be vested in the Trust. The Holders shall not have
legal title to any part of the assets of the Trust, but shall have an undivided
beneficial interest in the assets of the Trust.
SECTION 2.6. Power and Duties of the Administrative Trustees.
The Administrative Trustees shall have all duties and powers necessary
or desirable to carry out the purposes and terms of the Trust in accordance with
Section 2.3 including but not limited to those set forth below:
(a) to issue and sell the Securities in accordance with this
Declaration and the Purchase Agreement; provided, however, that, (i)
the Trust may issue no more than one series of Preferred Securities and
no more than one series of Common Securities, (ii) there shall be no
interests in the Trust other than the Securities, and (iii) the
issuance of Securities shall be limited to a simultaneous issuance of
both Preferred Securities and Common Securities at the Closing Time;
(b) in connection with the issue and sale of the Preferred
Securities, at the direction of the Sponsor:
(i) to execute and enter into the Purchase Agreement
providing for the sale of the Preferred Securities;
(ii) to acquire the Notes with the proceeds of the
sale of the Preferred Securities and the Common Securities;
(iii) to establish a record date with respect to all
actions to be taken hereunder that require a record date to be
established, including and with respect to Distributions,
voting rights, redemptions and exchanges, and to issue
relevant notices, to the Holders of Preferred Securities and
Holders of Common Securities as to such actions and applicable
record dates;
(iv) to take all actions and perform such duties as
may be required of the Administrative Trustees pursuant to the
terms of the Securities set forth in Annex I hereto;
(v) to bring or defend, pay, collect, compromise,
arbitrate, resort to legal action, or otherwise adjust claims
or demands of or against the Trust ("Legal Action");
(vi) to employ or otherwise engage employees and
agents (who may be designated as officers with titles) and
managers, contractors, advisors, and consultants and pay
reasonable compensation for such services;
(vii) to incur expenses that are necessary or
desirable to carry out any of the purposes of the Trust;
(viii) to act as, or appoint another Person to act
as, a Paying Agent for the Securities as provided in Section
6.3;
(ix) to take all action that may be necessary or
appropriate for the preservation and the continuation of the
Trust's valid existence, rights, franchises and privileges as
a statutory business trust under the laws of the State of
Delaware and of each other jurisdiction in which such
existence is necessary to protect the limited liability of the
Holders of the Capital Securities or to enable the Trust to
effect the purposes for which the Trust was create;
(x) to take any action, not inconsistent with this
Declaration or with applicable law, that the Administrative
Trustees determine in their discretion to be necessary or
desirable in carrying out the activities of the Trust as set
out in this Section 2.6, including, but not limited to:
(A) causing the Trust not to be deemed to be
an Investment Company required to be registered under
the Investment Company Act;
(B) causing the Trust to be classified for
United States federal income tax purposes as a
grantor trust; and
(C) cooperating with the Issuer to ensure
that the Notes will be treated as indebtedness of the
Issuer for United States federal income tax purposes;
provided that such action does not adversely affect the
interests of the Holders;
(xi) to take all action necessary to cause all applicable tax
returns and tax information reports that are required to be
filed with respect to the Trust to be duly prepared, signed
and filed by the Administrative Trustees, on behalf of the
Trust; and
(xii) to establish and maintain a segregated non-interest
bearing trust account (the "Trustee Account") in the name of
and under the exclusive control of the Administrative Trustees
on behalf of the Holders and, upon the receipt of payments of
funds made in respect of the Notes held by the Administrative
Trustees, deposit such funds into the Trustee Account and make
payments to the Holders of the Preferred Securities and
Holders of the Common Securities from the Trustee Account in
accordance with Section 5.1. Funds in the Trustee Account
shall be held uninvested until disbursed in accordance with
this Declaration. The Trustee Account shall be an account that
is maintained with a financial institution whose deposits are
insured by the Federal Deposit Insurance Corporation or
similar deposit insuring institution;
(xiii) to engage in such activities as shall be necessary or
appropriate to effect the redemption of the Securities to the
extent the Notes are redeemed or mature; and
(xiv) to effect the distribution of the Notes to Holders of
Securities upon the occurrence of certain events.
(c) The Administrative Trustees may take any Legal Action which arises
out of or in connection with an Event of Default of which such Trustees have
actual knowledge. If the Administrative Trustees shall have failed to take Legal
Action, to the fullest extent permitted by law, the Holders of the Preferred
Securities may institute a legal proceeding directly against the Issuer either
to enforce the Administrative Trustees' rights under the Notes, without first
proceeding against the Administrative Trustees, the Trust or any other Person;
or to institute a proceeding directly against the Note Issuer for enforcement of
payment to such Holder of the principal of or premium, if any, or interest on
the Notes having a principal amount equal to the aggregate liquidation amount of
the Preferred Securities of such Holder (a "Direct Action"). In connection with
such Direct Action, the rights of the Holders of the Common Securities will be
subrogated to the rights of such Holder of Preferred Securities to the extent of
any payment made by the Note Issuer to such Holder of Preferred Securities in
such Direct Action.
(d) The Administrative Trustees shall have the legal power to exercise
all of the rights, powers and privileges of a holder of Notes and, if an Event
of Default actually known to the Administrative Trustees occurs and is
continuing, the Administrative Trustees may, for the benefit of Holders, enforce
their rights as holder of the Notes subject to the rights of the Holders
pursuant to the terms of such Securities.
(e) The Administrative Trustees shall be authorized to undertake any
actions set forth in Section 317(a) of the Trust Indenture Act of 1939.
(f) The Administrative Trustees may authorize one or more Persons to
act as Paying Agents and to pay Distributions, redemption payments or
liquidation payments on behalf of the Trust with respect to all Securities. Any
such Paying Agent may be removed by the Administrative Trustees at any time the
Administrative Trustees remain as Paying Agent and a successor Paying Agent or
additional Paying Agents may be (but are not required to be) appointed at any
time by the Administrative Trustees.
(g) The Administrative Trustees shall exercise the rights and powers
vested in them by this Declaration, and use the same degree of care and skill in
their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs.
(h) The Administrative Trustees shall not be liable with respect to any
action taken or omitted to be taken in good faith in accordance with the
direction of the Holders of not less than a Majority in liquidation amount of
the Trust Securities relating to the time, method and place of conducting any
proceeding for any remedy available to the Administrative Trustees or exercising
any trust or power conferred upon the Administrative Trustees under this
Declaration.
(i) No provision of this Declaration shall require any Administrative
Trustee to expend or risk his own funds or otherwise incur personal financial
liability in the performance of any of his duties or in the exercise of his
rights or powers, if he shall have reasonable grounds for believing that the
repayment of such funds or liability is not reasonably assured to him under the
terms of this Declaration or indemnity reasonably satisfactory to the
Administrative Trustee against such risk or liability is not reasonably assured
to him.
(j) The Administrative Trustees' sole duty with respect to the custody,
safe keeping and physical preservation of the Notes and the Trustee Account
shall be to deal with such property in a similar manner as Trustees deal with
similar property for their own account, subject to the protections and
limitations on liability afforded to the Trustees under this Declaration.
(k) The Administrative Trustees shall have no duty or liability for or
with respect to the value, genuineness, existence or sufficiency of the Notes or
the payment of any taxes or assessments levied thereon or in connection
therewith.
(l) The Administrative Trustees shall not be liable for any interest on
any money received by them except as they may otherwise agree in writing with
the Sponsor.
(m) The Administrative Trustees must exercise the powers set forth in
this Section 2.6 in a manner that is consistent with the purposes and functions
of the Trust set out in Section 2.3, and the Administrative Trustees shall not
take any action that is inconsistent with the purposes and functions of the
Trust set forth in Section 2.3.
(n) Any expenses incurred by the Administrative Trustees pursuant to
this Section 2.6 shall be reimbursed by the Sponsor.
SECTION 2.7 Prohibited Actions.
(a) The Trust shall not, and the Trustees shall cause the Trust not to,
engage in any activity other than as required or authorized by this Declaration.
In particular, the Trust shall not and the Trustees shall cause the Trust not
to:
(i) invest any proceeds received by the Trust from holding the
Notes, but shall distribute all such proceeds to Holders pursuant to
the terms of this Declaration and of the Securities;
(ii) acquire any assets other than as expressly provided
herein;
(iii) possess Trust property for other than a Trust purpose;
(iv) make any loans or incur any indebtedness other than loans
represented by the Notes or pledge any assets or enter into any
mortgages;
(v) possess any power or otherwise act in such a way as to
vary the Trust assets or the terms of the Securities in any way
whatsoever (except to the extent expressly authorized in this
Declaration or by the terms of the Securities); or
(vi) issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust other than the
Securities.
SECTION 2.8. Certain Rights of Administrative Trustees.
(a) Subject to the provisions of Section 2.6:
(i) the Administrative Trustees may conclusively rely and
shall be fully protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report,
notice, request, directions, consent, order, bond note, other evidences
of indebtedness, or other paper or document report issued to them under
the terms of this Declaration;
(ii) any direction or act of the Sponsor contemplated by this
Declaration may be sufficiently evidenced by an Officers' Certificate;
(iii) whenever in the administration of this Declaration, the
Administrative Trustees shall deem it desirable that a matter be proved
or established before taking, suffering or omitting any action
hereunder, they (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on their part, request and
be entitled to receive and conclusively rely upon an Officers'
Certificate.
(iv) the Administrative Trustees may consult with counsel or
other experts of their selection and the advice or opinion of such
counsel and experts with respect to legal matters or advice within the
scope of such experts' area of expertise shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by them hereunder in good faith and in accordance with such
advice or opinion, and such counsel may be counsel to the Sponsor or
any of its Affiliates, and may include any of its employees. The
Administrative Trustees shall have the right at any time to seek
instructions concerning the administration of this Declaration from any
court of competent jurisdiction;
(v) the Administrative Trustees shall be under no obligation
to exercise any of the rights or powers vested in them by this
Declaration at the request or direction of any Holder, unless such
Holder shall have provided to the Trustees security and indemnity,
satisfactory to the Trustees, against the costs, expenses (including
reasonable attorneys' fees and expenses and the expenses of the
Trustees' agents, nominees or custodians) and liabilities that might be
incurred by them in complying with such request or direction, including
such reasonable advances as may be requested by the Trustees provided,
that nothing contained in this Section 2.8(a)(v) shall be taken to
relieve the Administrative Trustees, upon the occurrence of an Event of
Default, of their obligation to exercise the rights and powers vested
in them by this Declaration;
(vi) the Administrative Trustees shall not be bound to make
any investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, note, other evidence of indebtedness
or other paper or document, but the Administrative Trustees, in their
discretion, may make such further inquiry or investigation into such
facts or matters as they may see fit;
(vii) the Administrative Trustees may execute any of the
trusts or powers hereunder or perform any duties hereunder either
directly or by or through agents, custodians, nominees or attorneys and
the Trustees shall not be responsible for any misconduct or negligence
on the part of or for the supervision of any agent or attorney
appointed with due care by them hereunder;
(viii) any action taken by the Administrative Trustees or
their agents hereunder shall bind the Trust and the Holders of the
Securities, and the signature of the Administrative Trustees or their
agents alone shall be sufficient and effective to perform any such
action and no third party shall be required to inquire as to the
authority of the Trustees to so act or as to their compliance with any
of the terms and provisions of this Declaration, both of which shall be
conclusively evidenced by the Administrative Trustees or their agents
taking such action;
(ix) whenever in the administration of this Declaration the
Administrative Trustees shall deem it desirable to receive instructions
with respect to enforcing any remedy or right or taking any other
action hereunder, the Administrative Trustees (i) may request
instructions from the Holders of the Securities which instructions may
only be given by the Holders of the same proportion in liquidation
amount of the Securities as would be entitled to direct the
Administrative Trustees under the terms of the Securities in respect of
such remedy, right or action, (ii) may refrain from enforcing such
remedy or right or taking such other action until such instructions are
received, and (iii) shall be protected in conclusively relying on or
acting in accordance with such instructions;
(x) except as otherwise expressly provided by this
Declaration, the Administrative Trustees shall not be under any
obligation to take any action that is discretionary under the
provisions of this Declaration; and
(xi) the Administrative Trustees shall not be liable for any
action taken, suffered, or omitted to be taken by them in good faith,
without negligence, and reasonably believed by them to be authorized or
within the discretion or rights or powers conferred upon it by this
Declaration.
(b) No provision of this Declaration shall be deemed to impose any duty
or obligation on the Administrative Trustees to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on them, in
any jurisdiction in which it shall be illegal, or in which the Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts, or to exercise any such right, power, duty or obligation or
which would expose the Administrative Trustee to liability, financial or
otherwise. No permissive power or authority available to the Administrative
Trustees shall be construed to be a duty.
SECTION 2.8. Delaware Trustee.
Notwithstanding any other provision of this Declaration, the Delaware
Trustee shall not be entitled to exercise any powers, nor shall the Delaware
Trustee have any of the duties and responsibilities of the Administrative
Trustees or the Trustees generally (except as required under the Business Trust
Act) described in this Declaration. The Delaware Trustee shall be a Trustee for
the sole and limited purpose of fulfilling the requirements of Section 3807 of
the Business Trust Act.
SECTION 2.9. Not Responsible for Recitals or Issuance of Securities.
The recitals contained in this Declaration and the Securities shall be
taken as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations as to
the value or condition of the property of the Trust or any part thereof. The
Trustees make no representations as to the validity or sufficiency of this
Declaration or the Securities.
SECTION 2.10. Duration of Trust.
The Trust shall have existence up to March 31, 2048.
SECTION 2.11. Mergers.
(a) The Trust may not merge with or convert into, consolidate,
amalgamate, or be replaced by, or convey, transfer or lease its properties and
assets as an entirety or substantially as an entirety to any Person, except as
described in Section 3.11(b) and (c) or Section 3 of Annex I.
(b) The Trust may, at the request of the Sponsor, with the consent of
the Administrative Trustees or, if there are more than two, a majority of the
Administrative Trustees and without the consent of the Holders of Securities or
the Delaware Trustee, merge with or convert into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets as an
entirety or substantially as an entirety to, a trust organized as such under the
laws of any State; provided that:
(i) such successor entity (the "Successor Entity") either:
(A) expressly assumes all of the obligations of the
Trust under the Securities; or
(B) substitutes for the Securities other securities
having substantially the same terms as the Securities (the
"Successor Securities") so long as the Successor Securities
rank the same as the Securities rank with respect to
Distributions and payments upon liquidation, redemption and
otherwise;
(ii) the Sponsor expressly appoints a trustee of the Successor
Entity that possesses the same powers and duties as the Administrative
Trustees as the holder of the Notes;
(iii) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not cause the Capital Securities
(including any Successor Securities) to be downgraded by any nationally
recognized statistical rating organization;
(iv) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the Holders of Securities (including any
Successor Securities) in any material respect (other than with respect
to any dilution of such Holders' interests in the new entity);
(v) such Successor Entity has a purpose substantially
identical to that of the Trust;
(vi) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, the Sponsor has received an
opinion of an independent counsel to the Trust experienced in such
matters to the effect that:
(A) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely
affect the rights, preferences and privileges of the Holders
of Securities (including any Successor Securities) in any
material respect (other than with respect to any dilution of
the Holders' interest in the new entity);
(B) following such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease,
neither the Trust (nor the Successor Entity) will be required
to register as an Investment Company; and
(C) following such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease, the
Trust (or the Successor Entity) will continue to be classified
as a grantor trust for United States federal income tax
purposes; and
(vii) the Sponsor or any permitted successor or assignee owns
all of the common securities of such Successor Entity and guarantees
the obligations of such Successor Entity under the Successor Securities
at least to the extent provided by the Preferred Securities Guarantee.
(c) Notwithstanding Section 2.11(b), the Trust shall not, except with
the consent of Holders of 100% in liquidation amount of the Securities,
consolidate, amalgamate, merge with or into, or be replaced by, or convey,
transfer or lease its properties and assets as an entirety or substantially as
an entirety to, any other entity or permit any other entity to consolidate,
amalgamate, merge with or into, or replace it if such consolidation,
amalgamation, merger, replacement, conveyance, transfer or lease would cause the
Trust or the Successor Entity not to be classified as a grantor trust for United
States federal income tax purposes.
SECTION 2.12. Administrative Trustees May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
similar judicial proceeding relative to the Trust or any other obligor upon the
Securities or the property of the Trust or of such other obligor or their
creditors, the Administrative Trustees (irrespective of whether any
Distributions on the Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the
Administrative Trustees shall have made any demand on the Trust for the payment
of any past due Distributions) shall be entitled and empowered, to the fullest
extent permitted by law, by intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any
Distributions owing and unpaid in respect of the Securities (or, if the
Securities are original issue discount Securities, such portion of the
liquidation amount as may be specified in the terms of such Securities)
and to file such other papers or documents as may be necessary or
advisable in order to have the claims of the Trustees (including any
claim for the reasonable compensation, expenses, disbursements and
advances of the Trustees, their agents and counsel) and of the Holders
allowed in such judicial proceeding, and
(b) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Administrative Trustees and, in the
event they shall consent to the making of such payments directly to the Holders,
to pay to the Administrative Trustees any amount due them for the reasonable
compensation, expenses, disbursements and advances of the Administrative
Trustees, their agents and counsel, and any other amounts due the Administrative
Trustees.
Nothing herein contained shall be deemed to authorize the
Administrative Trustees to authorize or consent to or accept or adopt on behalf
of any Holder any plan of reorganization, arrangement, adjustment or
compensation affecting the Securities or the rights of any Holder thereof or to
authorize the Administrative Trustees to vote in respect of the claim of any
Holder in any such proceeding.
ARTICLE III
SPONSOR
SECTION 3.1. Sponsor's Purchase of Common Securities.
At the Closing Time, the Sponsor will purchase all of the Common
Securities then issued by the Trust, in an amount at least equal to 3% of the
capital of the Trust, at the same time as the Notes are issued and sold.
SECTION 3.2. Right to Proceed.
The Sponsor acknowledges the rights of the Holders of Preferred
Securities, in the event that a failure of the Trust to pay Distributions on the
Preferred Securities is attributable to the failure of the Company to pay
interest or principal on the Notes, to institute a proceeding directly against
the Note Issuer for enforcement of its payment obligations on the Notes.
SECTION 3.3. Right to Dissolve Trust.
The Sponsor shall have the right at any time after the Closing Date to
elect to dissolve the Trust in accordance with the terms of the Securities and
to direct the Administrative Trustees to take such action as shall be necessary
to distribute the Notes to the Holders of the Securities in exchange for all of
the Securities and to terminate the Trust.
ARTICLE IV
TRUSTEES
SECTION 4.1. Number of Trustees; Appointment of Co-Trustee.
The number of Trustees initially shall be two (2) of whom one shall be
the Delaware Trustee and one (1) shall be the Initial Administrative Trustee.
The number of Administrative Trustees shall be increased to three (3) prior to
the vesting of title to any assets in the Trust. The number of Administrative
Trustees may be increased or decreased by vote of the Holders of a Majority in
liquidation amount of the Common Securities voting as a class at a meeting of
the Holders of the Common Securities; provided, however, that, after the vesting
of title to any assets in the Trust, the number of Administrative Trustees shall
in no event be less than two (2); provided further that the Delaware Trustee, in
the case of a natural person, shall be a person who is a resident of the State
of Delaware or that, if not a natural person, is an entity which has its
principal place of business in the State of Delaware.
SECTION 4.2. Delaware Trustee.
If required by the Business Trust Act, one Trustee (the "Delaware
Trustee") shall be:
(a) a natural person who is a resident of the State of
Delaware; or
(b) if not a natural person, an entity which has its principal
place of business in the State of Delaware, and otherwise meets the
requirements of applicable law.
(c) The initial Delaware Trustee shall be:
Delaware Trust Capital Management, Inc.
900 Market Street, 2nd Floor
Wilmington, DE 19801
SECTION 4.3. Certain Qualifications of Administrative Trustees and
Delaware Trustee Generally.
Each Administrative Trustee and the Delaware Trustee shall be either a
natural person who is at least 21 years of age or a legal entity that shall act
through one or more Authorized Officers.
SECTION 4.4. Administrative Trustees.
The Initial Administrative Trustee shall be:
Stephen M. Morain
c/o FBL Financial Group, Inc.
5400 University Avenue
West Des Moines, Iowa 50266
The additional Administrative Trustees effective immediately
upon the vesting of title to any assets in the Trust shall be
Thomas R. Gibson and Richard D. Harris.
(a) Except as expressly set forth in this Declaration and except if a
meeting of the Administrative Trustees is called with respect to any matter over
which the Administrative Trustees have power to act, any power of the
Administrative Trustees may be exercised by, or with the consent of, any one
such Administrative Trustee;
(b) Unless otherwise determined by the Administrative Trustees, and
except as otherwise required by the Business Trust Act or applicable law, any
Administrative Trustee is authorized to execute on behalf of the Trust any
documents which the Administrative Trustees have the power and authority to
cause the Trust to execute pursuant to Section 2.6; and
(c) An Administrative Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purposes of signing any documents which the Administrative
Trustees have power and authority to cause the Trust to execute pursuant to
Section 2.6.
SECTION 4.5. Appointment, Removal and Resignation of Trustees.
(a) Subject to Section 4.5(b) of this Declaration and to Section 6(b)
of Annex I hereto, Trustees may be appointed or removed without cause at any
time:
(i) until the issuance of any Securities, by written
instrument executed by the Sponsor;
(ii) unless an Event of Default shall have occurred and be
continuing after the issuance of any Securities, by vote of the Holders
of a Majority in liquidation amount of the Common Securities voting as
a class at a meeting of the Holders of the Common Securities; and
(iii) if an Event of Default shall have occurred and be
continuing after the issuance of the Securities, with respect to the
Delaware Trustee, by vote of Holders of a Majority in liquidation
amount of the Preferred Securities voting as a class at a meeting of
Holders of the Preferred Securities.
(b) (i) All of the Administrative Trustees shall not be removed in
accordance with Section 4.5(a) until at least one Successor Administrative
Trustee has been appointed and has accepted such appointment by written
instrument executed by such Successor Trustee and delivered to the
Administrative Trustees and the Sponsor; and
(ii) the Trustee that acts as Delaware Trustee shall not be
removed in accordance with this Section 4.5(b) until a successor
Trustee possessing the qualifications to act as Delaware Trustee under
Sections 4.2 and 4.3 (a "Successor Delaware Trustee") has been
appointed and has accepted such appointment by written instrument
executed by such Successor Delaware Trustee and delivered to the
Administrative Trustees and the Sponsor.
(c) A Trustee appointed to office shall hold office until his
successor shall have been appointed or until his death, removal or resignation.
Any Trustee may resign from office (without need for prior or subsequent
accounting) by an instrument in writing signed by such Trustee and delivered to
the Sponsor and the Trust, which resignation shall take effect upon such
delivery or upon such later date as is specified therein; provided, however,
that:
(i) No such resignation of the only remaining Administrative
Trustee shall be effective:
(A) until a Successor Administrative Trustee has been
appointed and has accepted such appointment by instrument
executed by such Successor Administrative Trustee and
delivered to the Trust, the Sponsor and the resigning
Administrative Trustee; or
(B) until the assets of the Trust have been
completely liquidated and the proceeds thereof distributed to
the Holders of the Securities; and
(ii) no such resignation of the Trustee that acts as the
Delaware Trustee shall be effective until a Successor Delaware Trustee
has been appointed and has accepted such appointment by instrument
executed by such Successor Delaware Trustee and delivered to the Trust,
the Sponsor and the resigning Delaware Trustee.
(d) The Holders of the Common Securities shall use their best efforts
to promptly appoint a Successor Delaware Trustee or Successor Administrative
Trustee, as the case may be, if the sole remaining Administrative Trustee or the
Delaware Trustee delivers an instrument of resignation in accordance with this
Section 4.5.
(e) If no such Successor Administrative Trustee or Successor Delaware
Trustee shall have been appointed and accepted appointment as provided in this
Section 4.5 within 60 days after delivery of an instrument of resignation or
removal, the sole remaining Administrative Trustee or Delaware Trustee resigning
or being removed, as applicable, may petition any court of competent
jurisdiction for appointment of a Successor Administrative Trustee or Successor
Delaware Trustee. Such court may thereupon, after prescribing such notice, if
any, as it may deem proper and prescribe, appoint a Successor Administrative
Trustee or Successor Delaware Trustee, as the case may be.
(f) No Administrative Trustee or Delaware Trustee shall be liable for
the acts or omissions to act of any Successor Administrative Trustee or
Successor Delaware Trustee, as the case may be.
SECTION 4.6. Vacancies Among Trustees.
If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 4.1, or if the number of Trustees is
increased pursuant to Section 4.1, a vacancy shall occur. A resolution
certifying the existence of such vacancy by the Administrative Trustees or, if
there are more than two, a majority of the Administrative Trustees shall be
conclusive evidence of the existence of such vacancy. The vacancy shall be
filled with a Trustee appointed in accordance with Section 4.5.
SECTION 4.7. Effect of Vacancies.
The death, resignation, retirement, removal, bankruptcy, dissolution,
liquidation, incompetence or incapacity to perform the duties of a Trustee shall
not operate to dissolve, terminate or annul the Trust. Whenever a vacancy in the
number of Administrative Trustees shall occur, until such vacancy is filled by
the appointment of an Administrative Trustee in accordance with Section 4.5, the
Administrative Trustees in office, regardless of their number, shall have all
the powers granted to the Administrative Trustees and shall discharge all the
duties imposed upon the Administrative Trustees by this Declaration.
SECTION 4.8. Meetings.
If there is more than one Administrative Trustee, meetings of the
Administrative Trustees shall be held from time to time upon the call of any
Administrative Trustee. Regular meetings of the Administrative Trustees may be
held at a time and place fixed by resolution of the Administrative Trustees.
Notice of any in-person meetings of the Administrative Trustees shall be hand
delivered or otherwise delivered in writing (including by facsimile, with a hard
copy by overnight courier) not less than 48 hours before such meeting. Notice of
any telephonic meetings of the Administrative Trustees or any committee thereof
shall be hand delivered or otherwise delivered in writing (including by
facsimile, with a hard copy by overnight courier) not less than 24 hours before
a meeting. Notices shall contain a brief statement of the time, place and
anticipated purposes of the meeting. The presence (whether in person or by
telephone) of an Administrative Trustee at a meeting shall constitute a waiver
of notice of such meeting except where an Administrative Trustee attends a
meeting for the express purpose of objecting to the transaction of any activity
on the ground that the meeting has not been lawfully called or convened. Unless
provided otherwise in this Declaration, any action of the Administrative
Trustees may be taken at a meeting by vote of a majority of the Administrative
Trustees present (whether in person or by telephone) and eligible to vote with
respect to such matter, provided that a quorum is present, or without a meeting
by the unanimous written consent of the Administrative Trustees. In the event
there is only one (1) Administrative Trustee, any and all action of such
Administrative Trustee shall be evidenced by a written consent of such
Administrative Trustee.
SECTION 4.9. Delegation of Power.
(a) Any Administrative Trustee may, by power of attorney consistent
with applicable law, delegate to any other natural person over the age of 21 his
or her power for the purpose of executing any documents contemplated in Section
2.6; and
(b) the Administrative Trustees shall have power to delegate from time
to time to such of their number or to officers of the Trust the doing of such
things and the execution of such instruments either in the name of the Trust or
the names of the Administrative Trustees or otherwise as the Administrative
Trustees may deem expedient, to the extent such delegation is not prohibited by
applicable law or contrary to the provisions of the Trust, as set forth herein.
SECTION 4.10. Merger, Conversion, Consolidation or Succession to
Business.
Any Person into which the Delaware Trustee or any Administrative
Trustee that is not a natural person, as the case may be, may be merged or
converted or with which it may be consolidated, or any Person resulting from any
merger, conversion or consolidation to which the Delaware Trustee or any
Administrative Trustee that is not a natural person, as the case may be, shall
be a party, or any Person succeeding to all or substantially all the corporate
trust business of the Delaware Trustee or any Administrative Trustee that is not
a natural person, as the case may be, shall be the successor of the Delaware
Trustee or any Administrative Trustee that is not a natural person, as the case
may be, hereunder, provided such corporation shall be otherwise qualified and
eligible under this Article, without the execution or filing of any paper or any
further act on the part of any of the parties hereto.
Any Person into which the Delaware Trustee or any Administrative
Trustee that is not a natural person, as the case may be, may be merged or
converted or with which it may be consolidated, or any Person resulting from any
merger, conversion or consolidation to which a written consent of such
Administrative Trustee.
ARTICLE V
DISTRIBUTIONS
SECTION 5.1. Distributions.
Holders shall receive Distributions in accordance with the applicable
terms of Annex I and the relevant Holder's Securities. If and to the extent that
the Issuer makes a payment of interest (including compounded interest and
additional interest), premium and/or principal on the Notes (the amount of any
such payment being a "Payment Amount"), the Administrative Trustees shall and
are directed, to the extent funds are available for that purpose, to make a
distribution (a "Distribution") of the Payment Amount to Holders.
ARTICLE VI
ISSUANCE OF SECURITIES
SECTION 6.1. General Provisions Regarding Securities.
(a) The Administrative Trustees shall on behalf of the Trust issue one
class of capital securities representing undivided beneficial interests in the
assets of the Trust having such terms as are set forth in Annex I (the
"Preferred Securities") and one class of common securities representing
undivided beneficial interests in the assets of the Trust having such terms as
are set forth in Annex I (the "Common Securities"). The Trust shall issue no
securities or other interests in the assets of the Trust other than the
Securities.
(b) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and shall
not constitute a loan to the Trust.
(c) Upon issuance of the Securities as provided in this Declaration,
the Securities so issued shall be deemed to be validly issued, fully paid and
non-assessable undivided beneficial interests in the assets of the Trust.
(d) Every Person, by virtue of having become a Holder in accordance
with the terms of this Declaration, shall be deemed to have expressly assented
and agreed to the terms of, and shall be bound by, this Declaration.
SECTION 6.2. Execution and Authentication
(a) The Securities shall be signed on behalf of the Trust by one or
more Administrative Trustees. In case any Administrative Trustee of the Trust
who shall have signed any of the Securities shall cease to be such
Administrative Trustee before the Securities so signed shall be delivered by the
Trust, such Securities nevertheless may be delivered as though the person who
signed such Securities had not ceased to be such Administrative Trustee; and any
Securities may be signed on behalf of the Trust by such persons who, at the
actual date of execution of such Security, shall be the Administrative Trustees
of the Trust, although at the date of the execution and delivery of the
Declaration any such person was not such an Administrative Trustee.
(b) The Administrative Trustees shall sign the Securities for the Trust
by manual or facsimile signature. Unless otherwise determined by the Trust, such
signature shall be a manual signature.
The aggregate number of Securities outstanding at any time shall not
exceed the number set forth in the terms in Annex I hereto except as provided in
Section 6.5.
SECTION 6.3. Form and Dating.
The Preferred Securities shall be substantially in the form of Exhibit
A-1 and the Common Securities shall be substantially in the form of Exhibit A-2,
each of which is hereby incorporated in and expressly made a part of this
Declaration. Certificates representing the Securities may be printed,
lithographed or engraved or may be produced in any other manner as is reasonably
acceptable to the Administrative Trustees, as evidenced by their execution
thereof. The Securities may have letters, CUSIP or other numbers, notations or
other marks of identification or designation and such legends or endorsements
required by law, stock exchange rule, agreements to which the Trust is subject,
if any, or usage (provided that any such notation, legend or endorsement is in a
form acceptable to the Trust). The terms and provisions of the Securities set
forth in Annex I and the forms of Securities set forth in Exhibits A-1 and A-2
are part of the terms of this Declaration and to the extent applicable, the
Trustees and the Sponsor, by their execution and delivery of this Declaration,
expressly agree to such terms and provisions and to be bound thereby.
SECTION 6.3. Paying Agent.
The Trust may maintain an office or agency where Preferred Securities
may be presented for payment ("Paying Agent"). The Trust may appoint the Paying
Agent and may appoint one or more additional paying agents in such locations as
it shall determine which paying agent must be acceptable to the Administrative
Trustees and the Company. The term "Paying Agent" includes any additional paying
agent. The Trust may change any Paying Agent without prior notice to any Holder.
The Paying Agent shall be permitted to resign as Paying Agent upon 30 days'
written notice to the Administrative Trustees. If the Trust fails to appoint or
maintain another entity as Paying Agent, the Trustee shall act as such. The
Trust or any of its Affiliates may act as Paying Agent. The Trust shall act as
Paying Agent for the Common Securities.
The Trust may appoint a successor which successor Paying Agent shall be
acceptable to the Administrative Trustees and the Company.
SECTION 6.4. Paying Agent to Hold Money in Trust.
The Trust shall require each Paying Agent to agree in writing that the
Paying Agent will hold in trust for the benefit of Holders all money held by the
Paying Agent for the payment of liquidation amounts or Distributions on the
Securities, and will notify the Administrative Trustees if there are
insufficient funds for such purpose. While any such insufficiency continues, the
Administrative Trustees may require a Paying Agent to pay all money held by it
to the Administrative Trustees. The Trust at any time may require a Paying Agent
to pay all money held by it to the Administrative Trustees and to account for
any money disbursed by it. Upon payment over to the Administrative Trustees, the
Paying Agent (if other than the Trust or an Affiliate of the Trust) shall have
no further liability for the money. If the Trust or the Sponsor or an Affiliate
of the Trust or the Sponsor acts as Paying Agent, it shall segregate and hold in
a separate trust fund for the benefit of the Holders all money held by it as
Paying Agent.
SECTION 6.5. Replacement Securities.
If a Holder claims that a Security owned by it has been lost, destroyed
or wrongfully taken or if such Security is mutilated and is surrendered to the
Trust, the Trust shall issue a replacement Security if the Trust's requirements,
as the case may be, are met. The Trust may charge such Holder for its expenses
in replacing a Security, and may require an indemnity bond.
SECTION 6.6. Outstanding Preferred Securities.
The Preferred Securities outstanding at any time are all the Trust
Securities issued by the Trust except for those canceled by it, those delivered
to it for cancellation, and those described in this Section as not outstanding.
If a Preferred Security is replaced, pursuant to Section 6.5 hereof, it
ceases to be outstanding unless the Trust receives proof satisfactory to it that
the replaced Preferred Security is held by a bona fide purchaser.
If Preferred Securities are considered paid in accordance with the
terms of this Declaration, they cease to be outstanding and Distributions on
them shall cease to accumulate.
A Preferred Security does not cease to be outstanding because one of
the Trust, the Sponsor or an Affiliate of the Sponsor holds the Security.
SECTION 6.7. Preferred Securities in Treasury.
In determining whether the Holders of the required amount of Securities
have concurred in any direction, waiver or consent, Preferred Securities owned
by the Trust, or the Sponsor, as the case may be, shall be disregarded and
deemed not to be outstanding.
ARTICLE VII
TRANSFER OF INTERESTS
SECTION 7.1. Transfer of Securities.
(a) Securities may only be transferred, in whole or in part, in
accordance with the terms and conditions set forth in this Declaration and in
the terms of the Securities. Any transfer or purported transfer of any Security
not made in accordance with this Declaration shall be null and void. Any such
transferee shall be deemed not to be the holder of such Securities for any
purpose, including but not limited to, the receipt of Distributions on such
Securities, and such transferee shall be deemed to have no interest whatsoever
in such Securities.
(b) Subject to this Article VII, Preferred Securities may only be
transferred, in whole or in part, in accordance with the terms and conditions
set forth in this Declaration. Any transfer or purported transfer of any
security not made in accordance with this Declaration shall be null and void.
(c) The Sponsor may not transfer the Common Securities.
(d) The Administrative Trustees shall provide for the registration of
Preferred Securities and of the transfer of Preferred Securities, which will be
effected without charge but only upon payment (with such indemnity as the
Administrative Trustees may require) in respect of any tax or other governmental
charges that may be imposed in relation to it. Upon surrender for registration
of transfer of any Preferred Securities, the Administrative Trustees shall cause
one or more new Preferred Securities to be issued in the name of the designated
transferee or transferees. Every Preferred Security surrendered for registration
of transfer shall be accompanied by a written instrument of transfer in form
satisfactory to the Administrative Trustees duly executed by the Holder or such
Holder's attorney duly authorized in writing. Each Preferred Security
surrendered for registration of transfer shall be canceled by the Administrative
Trustees. A transferee of a Preferred Security shall be entitled to the rights
and subject to the obligations of a Holder hereunder upon the receipt by such
transferee of a Preferred Security. By acceptance of a Preferred Security, each
transferee shall be deemed to have agreed to be bound by this Declaration.
SECTION 7.2. Transfer Procedures and Restrictions.
(a) General. Except as otherwise provided in Section 7.2(b), if
Preferred Securities are issued upon the transfer, exchange or replacement of
Preferred Securities bearing the Restricted Securities Legend set forth in
Exhibit A-1 hereto, or if a request is made to remove such Restricted Securities
Legend on Preferred Securities, the Preferred Securities so issued shall bear
the Restricted Securities Legend, or the Restricted Securities Legend shall not
be removed, as the case may be, unless there is delivered to the Trust such
evidence satisfactory to the Sponsor, which shall include an Opinion of Counsel,
as may be reasonably required by the Sponsor, that neither the legend nor the
restrictions on transfer set forth therein are required to ensure that transfers
thereof are made pursuant to an exception from the registration requirements of
the Securities Act. Upon provision of such satisfactory evidence, the Trust
shall deliver Preferred Securities that do not bear the legend.
(b) Legend. Each Preferred Security certificate evidencing the
Securities (and all Preferred Securities issued in exchange therefor or
substitution thereof) shall bear a legend (the "Restricted Securities Legend")
in substantially the following form, as applicable:
THIS PREFERRED SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES
LAW OR ANY OTHER APPLICABLE SECURITIES LAW. NEITHER THIS PREFERRED
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED
OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
(c) All Preferred Securities issued upon any transfer or exchange
pursuant to the terms of this Declaration shall evidence the same security and
shall be entitled to the same benefits under this Declaration as the Preferred
Securities surrendered upon such transfer or exchange.
ARTICLE VIII
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 8.1. Liability.
(a) Except as expressly set forth in this Declaration, the Preferred
Securities Guarantee and the terms of the Securities, the Sponsor shall not:
(i) be personally liable for the return of any portion of the
capital contributions (or any return thereon) of the Holders of the
Securities which shall be made solely from assets of the Trust; and
(ii) be required to pay to the Trust or to any Holder of
Securities any deficit upon dissolution or termination of the Trust or
otherwise.
(b) The Sponsor shall be liable for all of the debts and obligations of
the Trust (other than with respect to the Securities) to the extent not
satisfied out of the Trust's assets.
(c) Pursuant to Section 3803(a) of the Business Trust Act, the Holders
of the Preferred Securities shall be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware.
SECTION 8.2. Exculpation.
(a) No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Trust or any Covered Person for any loss, damage
or claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith on behalf of the Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Declaration or by law, except that
an Indemnified Person shall be liable for any such loss, damage or claim
incurred by reason of such Indemnified Person's gross negligence or willful
misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Trust and upon such information, opinions, reports
or statements presented to the Trust by any Person as to matters the Indemnified
Person reasonably believes are within such other Person's professional or expert
competence and, if selected by such Indemnified Person, has been selected by
such Indemnified Person with reasonable care on behalf of the Trust, including
information, opinions, reports or statements as to the value and amount of the
assets, liabilities, profits, losses, or any other facts pertinent to the
existence and amount of assets from which Distributions to Holders of Securities
might properly be paid.
SECTION 8.3. Fiduciary Duty.
(a) To the extent that, at law or in equity, an Indemnified Person has
duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any other Covered Person for
its good faith reliance on the provisions of this Declaration. The provisions of
this Declaration, to the extent that they restrict the duties and liabilities of
an Indemnified Person otherwise existing at law in equity, are agreed by the
parties hereto to replace such other duties and liabilities of such Indemnified
Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between
any Covered Persons; or
(ii) whenever this Declaration or any other agreement
contemplated herein or therein provides that an Indemnified Person
shall act in a manner that is, or provides terms that are, fair and
reasonable to the Trust or any Holder of Securities,
the Indemnified Person shall resolve such conflict of interest in good faith,
take such action or provide such terms, considering in each case the relative
interest of each party (including its own interest) to such conflict, agreement,
transaction or situation and the benefits and burdens relating to such
interests, any customary or accepted industry practices, and any applicable
generally accepted accounting practices or principles. In the absence of bad
faith by the Indemnified Person, the resolution, action or term so made, taken
or provided by the Indemnified Person shall not constitute a breach of this
Declaration or any other agreement contemplated herein or of any duty or
obligation of the Indemnified Person at law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is permitted or
required to make a decision:
(i) in its "discretion" or under a grant of similar authority,
the Indemnified Person shall be entitled to consider such interests and
factors as it desires, including its own interests, and shall have no
duty or obligation to give any consideration to any interest of or
factors affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express standard,
the Indemnified Person shall act under such express standard and shall
not be subject to any other or different standard imposed by this
Declaration or by applicable law.
SECTION 8.4. Indemnification.
(a) (i) The Sponsor shall indemnify, to the full extent permitted by
law, any Company Indemnified 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 Trust) by reason of the fact that he is or was a
Company Indemnified Person against expenses (including attorneys' fees and
expenses), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or proceeding 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 Trust, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the Company Indemnified Person
did not act in good faith and in a manner which he reasonably believed to be in
or not opposed to the best interests of the Trust, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that his conduct
was unlawful.
(ii) The Note Issuer shall indemnify, to the full extent
permitted by law, any Company Indemnified 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 Trust to procure a
judgment in its favor by reason of the fact that he is or was a Company
Indemnified Person against expenses (including attorneys' fees and
expenses) 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 Trust and except that no such indemnification
shall be made in respect of any claim, issue or matter as to which such
Company Indemnified Person shall have been adjudged to be liable to the
Trust unless and only to the extent that the Court of Chancery of
Delaware or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability
but in view of all the circumstances of the case, such person is fairly
and reasonably entitled to indemnity for such expenses which such Court
of Chancery or such other court shall deem proper.
(iii) Any indemnification under paragraphs (i) and (ii) of
this Section 8.4(a) (unless ordered by a court) shall be made by the
Sponsor or the Note Issuer, as the case may be, only as authorized in
the specific case upon a determination that indemnification of the
Company Indemnified Person is proper in the circumstances because he
has met the applicable standard of conduct set forth in paragraphs (i)
and (ii). Such determination shall be made (1) by the Administrative
Trustees by a majority vote of a quorum consisting of such
Administrative Trustees who were not parties to such action, suit or
proceeding, (2) if such a quorum is not obtainable, or, even if
obtainable, if a quorum of disinterested Administrative Trustees so
directs, by independent legal counsel in a written opinion, or (3) by
the Common Security Holder of the Trust.
(iv) Expenses (including attorneys' fees and expenses)
incurred by a Company Indemnified Person in defending a civil,
criminal, administrative or investigative action, suit or proceeding
referred to in paragraphs (i) and (ii) of this Section 8.4(a) shall be
paid by the Sponsor or the Note Issuer, as the case may be, in advance
of the final disposition of such action, suit or proceeding upon
receipt of an undertaking by or on behalf of such Company Indemnified
Person to repay such amount if it shall ultimately be determined that
he is not entitled to be indemnified by the Note Issuer as authorized
in this Section 8.4(a). Notwithstanding the foregoing, no advance shall
be made by the Note Issuer if a determination is reasonably and
promptly made (i) by the Administrative Trustees by a majority vote of
a quorum of disinterested Administrative Trustees, (ii) if such a
quorum is not obtainable, or, even if obtainable, if a quorum of
disinterested Administrative Trustees so directs, by independent legal
counsel in a written opinion or (iii) by the Common Security Holder of
the Trust, that, based upon the facts known to the Administrative
Trustees, counsel or the Common Security Holder at the time such
determination is made, such Company Indemnified Person acted in bad
faith or in a manner that such person did not believe to be in or not
opposed to the best interests of the Trust, or, with respect to any
criminal proceeding, that such Company Indemnified Person believed or
had reasonable cause to believe his conduct was unlawful. In no event
shall any advance be made in instances where the Administrative
Trustees, independent legal counsel or Common Security Holder
reasonably determine that such person deliberately breached his duty to
the Trust or its Common or Preferred Security Holders.
(v) The indemnification and advancement of expenses provided
by, or granted pursuant to, the other paragraphs of this Section 8.4(a)
shall not be deemed exclusive of any other rights to which those
seeking indemnification and advancement of expenses may be entitled
under any agreement, vote of stockholders or disinterested directors of
the Note Issuer or Preferred Security Holders of the Trust or
otherwise, both as to action in his official capacity and as to action
in another capacity while holding such office. All rights to
indemnification under this Section 8.4(a) shall be deemed to be
provided by a contract between the Sponsor or the Note Issuer as the
case may be and each Company Indemnified Person who serves in such
capacity at any time while this Section 8.4(a) is in effect. Any repeal
or modification of this Section 8.4(a) shall not affect any rights or
obligations then existing.
(vi) The Sponsor or the Trust may purchase and maintain
insurance on behalf of any person who is or was a Company Indemnified
Person against any liability asserted against him and incurred by him
in any such capacity, or arising out of his status as such, whether or
not the Sponsor or the Note Issuer would have the power to indemnify
him against such liability under the provisions of this Section 8.4(a).
(vii) For purpose of this Section 8.4(a), references to "the
Trust" shall include, in addition to the resulting or surviving entity,
any constituent entity (including any constituent of a constituent)
absorbed in a consolidation or merger, so that any person who is or was
a director, trustee, officer or employee of such constituent entity, or
is or was serving at the request of such constituent entity as a
director, trustee, officer, employee or agent of another entity, shall
stand in the same position under the provisions of this Section 8.4(a)
with respect to the resulting or surviving entity as he would have with
respect to such constituent entity if its separate existence had
continued.
(viii) The indemnification and advancement of expenses
provided by, or granted pursuant to, this Section 8.4(a) shall, unless
otherwise provided when authorized or ratified, continue as to a person
who has ceased to be a Company Indemnified Person and shall inure to
the benefit of the heirs, executors and administrators of such a
person. The obligation to indemnify as set forth in this Section 8.4(a)
shall survive the satisfaction and discharge of this Declaration.
(b) The Sponsor agrees to indemnify (i) the Delaware Trustee (both in
its individual capacity and in its capacity as Trustee under this Agreement),
(ii) any Affiliate of the Delaware Trustee, and (iii) any officers, directors,
shareholders, members, partners, employees, representatives, custodians,
nominees or agents of the Delaware Trustee (each of the Persons in (i) through
(iii) being referred to as a "Fiduciary Indemnified Person") for, and to hold
each Fiduciary Indemnified Person harmless against, any and all loss, liability,
action, suit, cost, damage, claim or expense including taxes (other than any
compensation or fees received by such Fiduciary Indemnified Person in connection
with its services hereunder) incurred without gross negligence or bad faith on
its part, arising out of or in connection with the acceptance or administration
of the trust or trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending itself against or investigating
any claim or liability in connection with the exercise or performance of any of
its powers or duties hereunder. The provisions of this Section 8.4(b) shall
survive the satisfaction and discharge of this Declaration or the resignation or
removal of the Delaware Trustee, as the case may be.
SECTION 8.5. Outside Business.
Any Covered Person, the Sponsor, and the Delaware Trustee may engage in
or possess an interest in other business ventures of any nature or description,
independently or with others, similar or dissimilar to the business of the
Trust, and the Trust and the Holders shall have no rights by virtue of this
Declaration in and to such independent ventures or the income or profits derived
therefrom, and the pursuit of any such venture, even if competitive with the
business of the Trust, shall not be deemed wrongful or improper. No Covered
Person, the Sponsor, or the Delaware Trustee shall be obligated to present any
particular investment or other opportunity to the Trust even if such opportunity
is of a character that, if presented to the Trust, could be taken by the Trust,
and any Covered Person, the Sponsor, and the Delaware Trustee shall have the
right to take for its own account (individually or as a partner or fiduciary) or
to recommend to others any such particular investment or other opportunity. Any
Covered Person and the Delaware Trustee may engage or be interested in any
financial or other transaction with the Sponsor or any Affiliate of the Sponsor,
or may act as depository for, trustee or agent for, or act on any committee or
body of holders of, securities or other obligations of the Sponsor or its
Affiliates.
SECTION 8.6. Compensation; Fees.
The Sponsor agrees:
(a) to pay to the Trustees from time to time reasonable
compensation (including such compensation to the Delaware Trustee as
shall have been agreed to by the Sponsor and the Administrative
Trustees) for all services rendered by them hereunder (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust); and
(b) except as otherwise expressly provided herein, to
reimburse the Trustees upon request for all reasonable expenses,
disbursements and advances incurred or made by the Trustees in
accordance with any provision of this Declaration and the sale of the
Preferred Securities (including the reasonable compensation and the
expenses and disbursements of their respective agents and counsel),
except any such expense, disbursement or advance as may be attributable
to its gross negligence or bad faith.
The provisions of this Section 8.6 shall survive the dissolution of the
Trust and the termination of this Declaration and the removal or resignation of
any Trustee.
No Trustee may claim any lien or charge on any property of the Trust as
a result of any amount due pursuant to this Section 8.6.
ARTICLE IX
ACCOUNTING
SECTION 9.1. Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the calendar
year, or such other year as is required by the Code.
SECTION 9.2. Certain Accounting Matters.
(a) At all times during the existence of the Trust, the Administrative
Trustees shall keep, or cause to be kept, full books of account, records and
supporting documents, which shall reflect in reasonable detail, each transaction
of the Trust. The books of account shall be maintained on the accrual method of
accounting, in accordance with generally accepted accounting principles,
consistently applied. The Trust shall use the accrual method of accounting for
United States federal income tax purposes.
(b) The Administrative Trustees shall, as soon as available after the
end of each Fiscal Year of the Trust, cause to be prepared and mailed to each
Holder of Securities unaudited financial statements of the Trust for such Fiscal
Year, prepared in accordance with generally accepted accounting principles;
provided that if the Trust is required to comply with the periodic reporting
requirements of Sections 13(a) or 15(d) of the Exchange Act, such financial
statements for such Fiscal Year shall be examined and reported on by a firm of
independent certified public accountants selected by the Administrative Trustees
(which firm may be the firm used by the Sponsor).
(c) The Administrative Trustees shall cause to be duly prepared and
delivered to each of the Holders, any annual United States federal income tax
information statement, required by the Code, containing such information with
regard to the Securities held by each Holder as is required by the Code and the
Treasury Regulations. Notwithstanding any right under the Code to deliver any
such statement at a later date, the Administrative Trustees shall endeavor to
deliver all such information statements within 30 days after the end of each
Fiscal Year of the Trust.
(d) The Administrative Trustees shall cause to be duly prepared and
filed with the appropriate taxing authority, an annual United States federal
income tax return, on a Form 1041 or such other form required by United States
federal income tax law, and any other annual income tax returns required to be
filed by the Administrative Trustees on behalf of the Trust with any state or
local taxing authority.
SECTION 9.3. Banking.
The Trust may maintain one or more bank accounts in the name and for
the sole benefit of the Trust; provided, however, that all payments of funds in
respect of the Notes held by the Administrative Trustees shall be made directly
to the Administrative Trustee Account and no other funds of the Trust shall be
deposited in the Administrative Trustee Account. The sole signatories for such
accounts shall be designated by the Administrative Trustees.
SECTION 9.4. Withholding.
The Trust and the Administrative Trustees shall comply with all
withholding requirements under United Sates federal, state and local law. The
Trust shall request, and the Holders shall provide to the Trust, such forms or
certificates as are necessary to establish an exemption from withholding with
respect to each Holder, and any representations and forms as shall reasonably be
requested by the Trust to assist it in determining the extent of, and in
fulfilling, its withholding obligations. The Administrative Trustees shall file
required forms with applicable jurisdictions and, unless an exemption from
withholding is properly established by a Holder, shall remit amounts withheld
with respect to the Holder to applicable jurisdictions. To the extent that the
Trust is required to withhold and pay over any amounts to any authority with
respect to Distributions or allocations to any Holder, the amount withheld shall
be deemed to be a Distribution in the amount of the withholding to the Holder.
In the event of any claim over withholding, Holders shall be limited to an
action against the applicable jurisdiction. If the amount required to be
withheld was not withheld from actual Distributions made, the Trust may reduce
subsequent Distributions by the amount of such withholding.
ARTICLE X
AMENDMENTS AND MEETINGS
SECTION 10.1. Amendments.
(a) Except as otherwise provided in this Declaration or by any
applicable terms of the Securities, this Declaration may only be amended by a
written instrument approved and executed by the Administrative Trustees (or, if
there are more than two Administrative Trustees, a majority of the
Administrative Trustees) and if the amendment affects the rights, powers,
duties, obligations or immunities of the Delaware Trustee, the Delaware Trustee.
(b) No amendment shall be made, and any such purported amendment shall
be void and ineffective:
(i) unless, the Administrative Trustees shall have first
received:
(A) an Officers' Certificate from each of the Trust
and the Sponsor that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the
terms of the Securities); and
(B) an opinion of counsel (who may be counsel to the
Sponsor or the Trust) that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the
terms of the Securities), and
(ii) to the extent the result of such amendment would be to:
(A) cause the Trust to fail to continue to be
classified for purposes of United States federal income
taxation as a grantor trust;
(B) cause the Trust to be deemed to be an Investment
Company required to be registered under the Investment Company
Act;
(c) at such time after the Trust has issued any Securities that remain
outstanding, any amendment that would adversely affect the rights, privileges or
preferences of any Holder of Securities may be effected only with such
additional requirements as may be set forth in the terms of such Securities;
(d) Section 7.1(c) and this Section 10.1 shall not be amended without
the consent of all of the Holders of the Securities;
(e) Article III shall not be amended without the consent of the Holders
of a Majority in liquidation amount of the Common Securities.
(f) The rights of the Holders of the Common Securities under Article IV
to increase or decrease the number of, and appoint and remove Trustees shall not
be amended without the consent of the Holders of a Majority in liquidation
amount of the Common Securities; and
(g) Notwithstanding Section 10.1(c), this Declaration may be amended
without the consent of the Holders of the Securities to:
(i) cure any ambiguity, correct or supplement any provision in
this Declaration that may be inconsistent with any other provision of
this Declaration or to make any other provisions with respect to
matters or questions arising under this Declaration which shall not be
inconsistent with the other provisions of the Declaration;
(ii) modify, eliminate or add to any provisions of the
Declaration to such extent as shall be necessary to ensure that the
Trust will be classified for United States federal income tax purposes
as a grantor trust at all times that any Securities are outstanding or
to ensure that the Trust will not be required to register as an
Investment Company under the Investment Company Act; and
(iii) add covenants, restrictions or obligations of the
Sponsor;
provided, however, that in the case of clause (i), (ii) and (iii), such action
shall not adversely affect in any material respect the interests of the Holders
of the Securities, and any amendments of this Declaration pursuant to (i), (ii)
or (iii) shall become effective when notice thereof is given to the Holders of
the Securities.
(h) Promptly following the execution of an amendment, the
Administrative Trustees shall provide the Delaware Trustee with a fully executed
copy of such amendment.
SECTION 10.2. Meetings of the Holders; Action by Written Consent.
(a) Meetings of the Holders of any class of Securities may be called at
any time by the Administrative Trustees to consider and act on any matter on
which Holders of such class of Securities are entitled to act under the terms of
this Declaration, or the terms of the Securities. The Administrative Trustees
shall call a meeting of the Holders of such class if directed to do so by the
Holders of at least 50% in liquidation amount of such class of Securities. Such
direction shall be given by delivering to the Administrative Trustees one or
more notices in a writing stating that the signing Holders of Securities wish to
call a meeting and indicating the general or specific purpose for which the
meeting is to be called. Any Holders calling a meeting shall specify in writing
the certificates evidencing the Securities held by the Holders exercising the
right to call a meeting and only those Securities specified shall be counted for
purposes of determining whether the required percentage set forth in the second
sentence of this paragraph has been met.
(b) Except to the extent otherwise provided in the terms of the
Securities, the following provisions shall apply to meetings of Holders of
Securities:
(i) notice of any such meeting shall be given to all the
Holders of Securities having a right to vote thereat at least seven
days and not more than 60 days before the date of such meeting.
Whenever a vote, consent or approval of the Holders is permitted or
required under this Declaration, such vote, consent or approval may be
given at a meeting of the Holders. Any action that may be taken at a
meeting of the Holders of Securities may be taken without a meeting if
a consent in writing setting forth the action so taken is signed by the
Holders of Securities owning not less than the minimum amount of
Securities in liquidation amount that would be necessary to authorize
or take such action at a meeting at which all Holders having a right to
vote thereon were present and voting. Prompt notice of the taking or
action without a meeting shall be given to the Holders entitled to vote
who have not consented in writing. The Administrative Trustees may
specify that any written ballot submitted to the Security Holders for
the purpose of taking any action without a meeting shall be returned to
the Trust within the time specified by the Administrative Trustees;
(ii) each Holder may authorize any Person to act for it by
proxy on all matters in which a Holder is entitled to participate,
including waiving notice of any meeting, or voting or participating at
a meeting. No proxy shall be valid after the expiration of 11 months
from the date thereof unless otherwise provided in the proxy. Every
proxy shall be revocable prior to the vote by the Holder of Securities
executing it. Except as otherwise provided herein, all matters relating
to the giving, voting or validity of proxies shall be governed by the
General Corporation Law of the State of Delaware relating to proxies,
and judicial interpretations thereunder, as if the Trust were a
Delaware corporation and the Holders were stockholders of a Delaware
corporation;
(iii) each meeting of the Holders shall be conducted by the
Administrative Trustees or by such other Person that the Administrative
Trustees may designate; and
(iv) unless the Business Trust Act, this Declaration or the
terms of the Securities otherwise provides, the Administrative
Trustees, in their sole discretion, shall establish all other
provisions relating to meetings of Holders, including notice of the
time, place or purpose of any meeting at which any matter is to be
voted on by any Holders of Securities, waiver of any such notice,
action by consent without a meeting, the establishment of a record
date, quorum requirements, voting in person or by proxy or any other
matter with respect to the exercise of any such right to vote.
ARTICLE XI
REPRESENTATIONS OF DELAWARE TRUSTEE
The Trustee that acts as initial Delaware Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Delaware Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee that:
(a) The Delaware Trustee satisfies the requirements set forth
in Section 4.2 and has the power and authority to execute and deliver,
and to carry out and perform its obligations under the terms of, this
Declaration and, if it is not a natural person, is duly organized,
validly existing and in good standing under the laws of its
jurisdiction of incorporation or organization;
(b) The execution, delivery and performance by the Delaware
Trustee of this Declaration has been duly authorized by all necessary
corporate action on the part of the Delaware Trustee. This Declaration
has been duly executed and delivered by the Delaware Trustee and
constitutes a legal, valid and binding obligation of the Delaware
Trustee, enforceable against it in accordance with its terms, subject
to applicable bankruptcy, reorganization, moratorium, insolvency, and
other similar laws affecting creditors' rights generally and to general
principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding
in equity or at law);
(c) No consent, approval or authorization of, or registration
with or notice to, any federal banking authority governing its bank or
trust powers is required for the execution, delivery or performance by
the Delaware Trustee of this Declaration; and
(d) The Delaware Trustee is a natural person who is a resident
of the State of Delaware or, if not a natural person, an entity which
has its principal place of business in the State of Delaware.
ARTICLE XII
MISCELLANEOUS
SECTION 12.1. Notices.
All notices provided for in this Declaration shall be in writing, duly
signed by the party giving such notice, and shall be delivered, telecopied or
mailed by first class mail, as follows:
(a) if given to the Trust, in care of the Administrative
Trustees at the Trust's mailing address set forth below (or such other
address as the Trust may give notice of to the Holders and the Property
Trustee):
FBL Financial Group Capital Trust
FBL Financial Group, Inc.
5400 University Avenue
West Des Moines, Iowa 50266
(b) if given to the Delaware Trustee, at the mailing address
set forth below (or such other address as Delaware Trustee may give
notice of to the Holders):
Delaware Trust Capital Management, Inc.
900 Market Street, 2nd Floor
Wilmington, Delaware 19801
(c) if given to the Holder of the Common Securities, at the
mailing address of the Sponsor set forth below (or such other address
as the Holder of the Common Securities may give notice to the Trust and
the Property Trustee):
FBL Financial Group, Inc.
5400 University Avenue
West Des Moines, Iowa 50266
(d) if given to any other Holder, at the address set forth on
the books and records of the Trust.
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.
SECTION 12.2. Governing Law.
This Declaration and the rights of the parties hereunder shall be
governed by and interpreted in accordance with the laws of the State of Delaware
and all rights and remedies shall be governed by such laws without regard to
principles of conflict of laws.
SECTION 12.3. Intention of the Parties.
It is the intention of the parties hereto that the Trust be classified
for United States federal income tax purposes as a grantor trust. The provisions
of this Declaration shall be interpreted to further this intention of the
parties.
SECTION 12.4. Headings.
Headings contained in this Declaration are inserted for convenience of
reference only and do not affect the interpretation of this Declaration or any
provision thereof.
SECTION 12.5. Successors and Assigns.
Whenever in this Declaration any of the parties hereto is named or
referred to, the successors and assigns of such party shall be deemed to be
included, and all covenants and agreements in this Declaration by the Sponsor
and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.
SECTION 12.6. Partial Enforceability.
If any provision of this Declaration, or the application of such
provision to any Person or circumstance, shall be held invalid, the remainder of
this Declaration, or the application of such provision to persons or
circumstances other than those to which it is held invalid, shall not be
affected thereby.
SECTION 12.7. Counterparts.
This Declaration may contain more than one counterpart of the signature
page and this Declaration may be executed by the affixing of the signature of
each of the Trustees to one of such counterpart signature pages. All of such
counterpart signature pages shall be read as though one, and they shall have the
same force and effect as though all of the signers had signed a single signature
page.
IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of the day and year first above written.
Dated: May 28, 1997 /s/ Stephen M. Morain
--------------------------------------------
Stephen M. Morain, as Initial Administrative
Trustee
Dated: May 28, 1997 DELAWARE TRUST CAPITAL MANAGEMENT
as Delaware Trustee
By /s/ Richared N. Smith
-----------------------------------------
Name: Richard N. Smith
--------------------------------------
Title: Vice President
-------------------------------------
Dated: May 28, 1997 FBL FINANCIAL GROUP, INC.
as Sponsor
By /s/ William J. Oddy
-----------------------------------------
William J. Oddy
-----------------------------------------
Chief Operating Officer
-----------------------------------------
ANNEX I
TERMS OF
5.0% PREFERRED SECURITIES
5.0% COMMON SECURITIES
Pursuant to Section 6.1 of the Declaration of Trust of the FBL
Financial Group Capital Trust, dated as of May 30, 1997 (as amended from time to
time, the "Declaration"), the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Preferred Securities and the
Common Securities are set out below (each capitalized term used but not defined
herein has the meaning set forth in the Declaration).
1. Designation and Number.
(a) Preferred Securities. 97,000 Preferred Securities of the Trust, with an
aggregate liquidation amount at any time outstanding with respect to the assets
of the Trust of ninety-seven million dollars ($97,000,000), with a liquidation
amount with respect to the assets of the Trust of $1,000 per Security, are
hereby designated for the purposes of identification only as "5% Preferred
Securities" (the "Preferred Securities"). The certificates evidencing the
Preferred Securities shall be substantially in the form of Exhibit A-1 to the
Declaration, with such changes and additions thereto or deletions therefrom as
may be required by ordinary usage, custom or practice.
(b) Common Securities. 3,000 Common Securities of the Trust, with an aggregate
liquidation amount with respect to the assets of the Trust of three million
dollars ($3,000,000), and each Common Security with a liquidation amount with
respect to the assets of the Trust of $1,000 per Security, are hereby designated
for the purposes of identification only as "5% Common Securities" (the "Common
Securities," and together with the Preferred Securities, the "Securities"). The
certificates evidencing the Common Securities shall be substantially in the form
of Exhibit A-2 to the Declaration, with such changes and additions thereto or
deletions therefrom as may be required by ordinary usage, custom or practice.
2. Distributions.
(a) Distributions payable on each Security will be fixed at a rate per annum of
5% (the "Interest Rate") of the liquidation amount of $1,000 per Security (the
"Liquidation Amount"), such rate being the rate of interest payable on the Notes
to be held by the Administrative Trustees. Except for Distributions which are
deferred as provided in Section 2(b), Distributions in arrears for more than one
quarterly period will bear interest thereon compounded quarterly at the Interest
Rate (to the extent permitted by applicable law). The term "Distributions," as
used herein, includes distributions of any such interest payable unless
otherwise stated. A Distribution is payable only to the extent that payments are
made in respect of the Notes held by the Administrative Trustees and to the
extent the Administrative Trustees have funds legally available therefor.
(b) Distributions on the Securities will be cumulative, will accumulate from the
most recent date to which Distributions have been paid or duly provided for or,
if no Distributions have been paid or duly provided for, from May 30, 1997, and
will be payable quarterly in arrears on March 31, June 30, September 30 and
December 31 of each year, commencing on June 30, 1997 (each, a "Distribution
Date"), except as otherwise described below. Distributions will be computed on
the basis of a 360-day year consisting of twelve 30-day months and for any
period less than a full calendar month on the basis of the actual number of days
elapsed in such month. As long as no Event of Default has occurred and is
continuing under the Securities, the Note Issuer has the right under the Note
Agreement to defer payments of interest by extending the interest payment period
at any time and from time to time on the Notes for a period not exceeding 20
consecutive quarterly periods, including the first such quarterly period during
such period (each, an "Extended Interest Payment Period"), during which Extended
Interest Payment Period no interest shall be due and payable on the Notes,
provided that no Extended Interest Payment Period shall end on a day other than
an Interest Payment Date (as defined in the Note) for the Notes or shall extend
beyond the Maturity Date (as defined in the Note) of the Notes. As a consequence
of such deferral, Distributions shall not be due and payable and will also be
deferred. Prior to the termination of any such Extended Interest Payment Period,
the Note Issuer may further defer payments of interest by further extending such
Extended Interest Payment Period; provided that such Extended Interest Payment
Period, together with all such previous and further extensions within such
Extended Interest Payment Period, may not exceed 20 consecutive quarterly
periods, including the first quarterly period during such Extended Interest
Payment Period, or extend beyond the Maturity Date of the Notes. Upon the
termination of any Extended Interest Payment Period and the payment of all
amounts then due, the Note Issuer may commence a new Extended Interest Payment
Period, subject to the above requirements.
(c) In the event the Note Issuer exercises the right under the Note Agreement to
defer payments of interest on the Notes, then (i) the Note Issuer shall not
declare or pay any dividends or distributions on, or redeem, purchase, acquire,
or make a liquidation payment with respect to, any of the Company's stock (which
includes Class A Common, Class B Common and preferred stock) or (ii) make any
payment of principal, interest or premium, if any, on or repay or repurchase or
redeem any debt securities of the Company (including any Other Notes as defined
in the Note) that rank pari passu with or junior in right of payment to the
Securities or (iii) make any guarantee payments with respect to any guarantee by
the Company of any securities of any Subsidiary of the Company (including Other
Guarantees as defined in the Note) if such guarantee ranks pari passu or junior
in right of payment to the Securities (other than (a) dividends or distributions
in shares of, or options, warrants or rights to subscribe for or purchase shares
of, Preferred stock of the Company; (b) any declaration of a dividend in
connection with the implementation of a stockholder's rights plan, or the
issuance of stock under any such plan in the future, or the redemption or
repurchase of any such rights pursuant thereto; (c) payments under the Preferred
Securities Guarantee; (d) as a direct result of, and only to the extent required
in order to avoid the issuance of fractional shares of Preferred stock
following, a reclassification of the Company's Preferred stock or the exchange
or the conversion of one class or series of the Company's Preferred stock for
another class or series of the Company's Preferred stock or pursuant to an
acquisition in which fractional shares of the Company's Preferred stock would
otherwise be issued; (e) the purchase of fractional interests in shares of the
Company's Preferred stock pursuant to the conversion or exchange provisions of
such Preferred stock or the security being converted or exchanged; and (f)
purchases of common stock related to the issuance of common stock or rights
under any benefit plans for directors, officers, agents or employees of the
Company or its subsidiaries, or any of the Company's dividend reinvestment or
director, officer, agent or employee stock purchase plans).
(d) Except as provided in Section 2(c) above, Distributions on the Securities
will be payable to the Holders thereof as they appear on the books and records
of the Trust on the fifteenth (15) day of the month preceding the month in which
the relevant Distribution Date occurs, which Distribution Dates correspond to
the Interest Payment Dates on the Notes. Payments in respect of Securities held
in certificated form will be made by check mailed to the Holder entitled
thereto. The relevant record dates for the Common Securities shall be the same
as the record dates for the Preferred Securities. Distributions payable on any
Securities that are not punctually paid on any Distribution Date, as a result of
the Note Issuer having failed to make a payment under the Notes, will cease to
be payable to the Holder on the relevant record date, and such defaulted
Distribution will instead be payable to the Person in whose name such Securities
are registered on the special record date or other specified date determined in
accordance with the Note. If any date on which Distributions are payable on the
Securities is not a Business Day, then payment of the Distribution payable on
such date will be made on the next succeeding day that is a Business Day (and
without any interest or other payment in respect of any such delay), except that
if such Business Day falls in the next calendar year, such payment will be made
on the immediately preceding Business Day, in each case, with the same force and
effect as if made on such date.
(e) In the event that there is any money or other property held by or for the
Trust that is not accounted for hereunder, such property shall be distributed
Pro Rata (as defined herein) among the Holders of the Securities.
3. Liquidation Distribution Upon Dissolution.
In the event of any termination of the Trust, the Trust shall be
liquidated by the Administrative Trustees as expeditiously as the Administrative
Trustees determine to be possible by distributing, after satisfaction of
liabilities to creditors of the Trust as provided by applicable law, to the
Holders of the Securities a Like Amount (as defined below) of the Notes on a Pro
Rata basis, unless such distribution is determined by the Administrative
Trustees not to be practicable. Upon such determination or upon any other
voluntary or involuntary termination or liquidation of the Trust in which the
Notes are not distributed, the holders of the Trust Securities will be entitled
to receive out of the assets of the Trust legally available for distribution to
Holders, after satisfaction of liabilities to creditors of the Trust as provided
by applicable law, an amount equal to the aggregate of the liquidation amount of
$1,000 per Security plus accumulated and unpaid Distributions thereon to the
date of payment (such amount being the "Liquidation Distribution").
"Like Amount" means (i) with respect to a redemption of the Securities,
Securities having a Liquidation Amount equal to the principal amount of Notes to
be paid in accordance with their terms and (ii) with respect to a distribution
of Notes upon the liquidation of the Trust, Notes having a principal amount
equal to the Liquidation Amount of the Securities of the Holder to whom such
Notes are distributed.
If, upon any such liquidation, the Liquidation Distribution can be paid
only in part because the Trust has insufficient assets legally available to pay
in full the aggregate Liquidation Distribution, then the amounts payable
directly by the Trust on the Securities shall be paid on a Pro Rata basis,
except that if an Event of Default has occurred and is continuing, the Preferred
Securities shall have priority over the Common Securities.
4. Redemption and Distribution.
(a) Upon the repayment of the Notes, the proceeds from such repayment shall be
simultaneously applied by the Administrative Trustees on behalf of the
Trust(subject to the Administrative Trustees having received notice no later
than 45 days prior to such repayment) to redeem the Securities at a redemption
price equal to the Redemption Price (as defined below). Holders will be given
not less than 30 nor more than 60 days notice of such redemption.
(b) The "Redemption Price," with respect to a redemption of Securities, shall
mean an amount equal to the principal of and accrued and unpaid interest on the
Notes as of the Maturity Date.
(c) On and from the date fixed by the Administrative Trustees for any
distribution of Notes and liquidation of the Trust: (i) the Securities will no
longer be deemed to be outstanding, and any certificates representing Securities
(including, but not limited to, the Common Securities) will be deemed to
represent beneficial interests in the Notes until such certificates are
presented to the Note Issuer or its agent for cancellation.
(d) The procedure with respect to prepayments or distributions of Notes shall be
as follows:
(i) Notice of any redemption of, or notice of distribution of Notes in
exchange for, the Securities (a "Redemption/Distribution Notice") will
be given by the Administrative Trustees on behalf of the Trust by mail
to each Holder of Securities to be redeemed or exchanged (with a copy
to the Delaware Trustee) not fewer than 30 nor more than 60 days before
the date fixed for redemption or exchange thereof (the "Redemption
Date") which, in the case of a redemption, will be the date fixed for
prepayment of the Notes. For purposes of the calculation of the date of
redemption or exchange and the dates on which notices are given
pursuant to this Section 4(d)(i), a Redemption/Distribution Notice
shall be deemed to be given on the day such notice is first mailed by
first-class mail, postage prepaid, to Holders. Each
Redemption/Distribution Notice shall be addressed to the Holders at the
address of each such Holder appearing in the books and records of the
Trust. No defect in the Redemption/Distribution Notice or in the
mailing of either thereof with respect to any Holder shall affect the
validity of the redemption or exchange proceedings with respect to any
other Holder.
(ii) If Securities are to be redeemed and the Trust gives a
Redemption/Distribution Notice, (which notice will be irrevocable),
then, on the Redemption Date, provided that the Note Issuer has paid
the Administrative Trustees a sufficient amount of cash in connection
with the related redemption or maturity of the Notes by 10:00 a.m.,
Iowa time, on the maturity date or the Redemption Date, as the case
requires, the Administrative Trustees shall pay the relevant Redemption
Price to the Holders by check mailed to the address of the relevant
Holder appearing on the books and records of the Trust on the
Redemption Date. If a Redemption/Distribution Notice shall have been
given and funds deposited as required, if applicable, then immediately
prior to the close of business on the date of such deposit, or on the
redemption date, as applicable, Distributions will cease to accumulate
on the Securities so called for redemption and all rights of Holders of
Securities so called for redemption will cease, except the right of the
Holders of such Securities to receive the Redemption Price, but without
interest on such Redemption Price, and such Securities shall cease to
be outstanding.
(iii) Payment of accumulated and unpaid Distributions on the Redemption
Date of the Securities will be subject to the rights of Holders of
Securities on the close of business on a regular record date in respect
of a Distribution Date occurring on or prior to such redemption date.
(iv) Neither the Administrative Trustees nor the Trust shall be
required to register or cause to be registered the transfer of the
Securities beginning on the opening of business 15 days before the day
of mailing of a Redemption\Distribution Notice and ending at the close
of business on the day of such mailing. If any date fixed for
redemption of Securities is not a Business Day, then payment of the
Redemption Price payable on such date will be made on the next
succeeding day that is a Business Day (and without any interest or
other payment in respect of any such delay), except that if such
Business Day falls in the next calendar year, such payment will be made
on the immediately preceding Business Day, in each case, with the same
force and effect as if made on such date fixed for redemption. If
payment of the Redemption Price in respect of any Securities is
improperly withheld or refused and not paid either by the
Administrative Trustees or by the Sponsor as guarantor pursuant to the
Preferred Securities Guarantee, Distributions on such Securities will
continue to accumulate from the original redemption date to the actual
date of payment, in which case the actual payment date will be
considered the date fixed for redemption for purposes of calculating
the Redemption Price.
(v) Redemption/Distribution Notices shall be sent by the Administrative
Trustees on behalf of the Trust to the Holders thereof.
(vi) Subject to the foregoing and applicable law (including, without
limitation, United States federal securities laws), the Sponsor or any
of its subsidiaries may at any time and from time to time purchase
outstanding Preferred Securities by tender, in the open market or by
private agreement.
5. Voting Rights - Preferred Securities.
(a) Except as provided under Sections 5(b) and 7 and as otherwise required by
law and the Declaration, the Holders of the Preferred Securities will have no
voting rights.
(b) If the Administrative Trustees fail to enforce their rights under the
Declaration, any Holder of Preferred Securities may, to the extent permitted by
applicable law, institute a legal proceeding directly against any person to
enforce the Administrative Trustees' rights under the Declaration without first
instituting a legal proceeding against the Administrative Trustee or any other
Person. If an Event of Default under the Declaration has occurred and is
continuing and such event is attributable to the failure of the Note Issuer to
pay principal of or premium, if any, or interest on the Notes on the due date
(or in the case of redemption, on the redemption date), then a Holder of
Preferred Securities may pursuant to Section 5.03 of the Note Agreement and
Section 2.6(b) of the Declaration institute a Direct Action for enforcement of
payment to such Holder of the principal of or premium, if any, or interest on a
Like Amount of Notes on or after the respective due date specified in the Notes.
In connection with such Direct Action, the rights of the Holder of the Common
Securities will be subrogated to the rights of such Holder of Preferred
Securities to the extent of any payment made by the Note Issuer to such Holder
of Preferred Securities in such Direct Action. Except as provided in the second
preceding sentence and in Section 2.6(b) of the Declaration, the Holders of
Preferred Securities will not be able to exercise directly any other remedy
available to the holders of the Notes.
(c) Any approval or direction of Holders of Preferred Securities may be given at
a separate meeting of Holders of Preferred Securities convened for such purpose,
at a meeting of all of the Holders of Securities in the Trust or pursuant to
written consent. The Administrative Trustees will cause a notice of any meeting
at which Holders of Preferred Securities are entitled to vote, or of any matter
upon which action by written consent of such Holders is to be taken, to be
mailed to each Holder of record of Preferred Securities. Each such notice will
include a statement setting forth (i) the date of such meeting or the date by
which such action is to be taken, (ii) a description of any resolution proposed
for adoption at such meeting on which such Holders are entitled to vote or of
such matter upon which written consent is sought and (iii) instructions for the
delivery of proxies or consents.
No vote or consent of the Holders of the Preferred Securities will be
required for the Trust to redeem and cancel Preferred Securities or to
distribute the Notes in accordance with the Declaration and the terms of the
Securities.
Notwithstanding that Holders of Preferred Securities are entitled to
vote or consent under any of the circumstances described above, any of the
Preferred Securities that are owned by the Sponsor shall not be entitled to vote
or consent and shall, for purposes of such vote or consent, be treated as if
they were not outstanding.
6. Voting Rights - Common Securities.
(a) Except as provided under Sections 6(b), 6(c), and 7, and as otherwise
required by law and the Declaration, the Holders of the Common Securities will
have no voting rights.
(b) Unless an Event of Default shall have occurred and be continuing, any
Trustee may be removed at any time by the Holder of the Common Securities. If an
Event of Default has occurred and is continuing, the Administrative Trustees and
the Delaware Trustee may be removed at such time by the Holders of a Majority in
liquidation amount of the outstanding Preferred Securities. In no event will the
Holders of the Preferred Securities have the right to vote to appoint, remove or
replace the Administrative Trustees, which voting rights are vested exclusively
in the Sponsor as the Holder of the Common Securities. No resignation or removal
of a Trustee and no appointment of a successor trustee shall be effective until
the acceptance of appointment by the successor trustee in accordance with the
provisions of the Declaration.
(c) If the Administrative Trustees fail to enforce their rights under the
Declaration, any Holder of Common Securities may, to the extent permitted by
applicable law, institute a legal proceeding directly against any person to
enforce the Administrative Trustees' rights under the Declaration without first
instituting a legal proceeding against the Administrative Trustees or any other
Person. If an Event of Default under the Declaration has occurred and is
continuing and such event is attributable to the failure of the Note Issuer to
pay principal of or premium, if any, or interest on the Notes on the due date
(or in the case of redemption, on the redemption date), then a Holder of Common
Securities may institute a Direct Action for enforcement of payment to such
Holder of the principal of or premium, if any, or interest on a Like Amount of
Notes on or after the respective due date specified in the Notes. In connection
with Direct Action, the rights of the Common Securities Holder will be
subordinated to the rights of such Holder of Preferred Securities to the extent
of any payment made by the Note Issuer to such Holder of Common Securities in
such Direct Action. Except as provided in the second preceding sentence, the
Holders of Common Securities will not be able to exercise directly any other
remedy available to the holders of the Notes.
Any approval or direction of Holders of Common Securities may be given
at a separate meeting of Holders of Common Securities convened for such purpose,
at a meeting of all of the Holders of Securities in the Trust or pursuant to
written consent. The Administrative Trustees will cause a notice of any meeting
at which Holders of Common Securities are entitled to vote, or of any matter
upon which action by written consent of such Holders is to be taken, to be
mailed to each Holder of record of Common Securities. Each such notice will
include a statement setting forth (i) the date of such meeting or the date by
which such action is to be taken, (ii) a description of any resolution proposed
for adoption at such meeting on which such Holders are entitled to vote or of
such matter upon which written consent is sought and (iii) instructions for the
delivery of proxies or consents.
No vote or consent of the Holders of the Common Securities will be
required for the Trust to redeem and cancel Common Securities or to distribute
the Notes in accordance with the Declaration and the terms of the Securities.
7. Amendments to Declaration and Securities.
In addition to the requirements set out in Section 10.1 of the
Declaration, the Declaration may be amended from time to time by the Sponsor and
the Administrative Trustees, without the consent of the Holders of the
Securities (i) to cure any ambiguity, correct or supplement any provisions in
the Declaration that may be inconsistent with any other provisions, or to make
any other provisions with respect to matters or questions arising under the
Declaration which shall not be inconsistent with the other provisions of the
Declaration, (ii) to modify, eliminate or add to any provisions of the
Declaration to such extent as shall be necessary to ensure that the Trust will
be classified for United States federal income tax purposes as a grantor trust
at all times that any Securities are outstanding or to ensure that the Trust
will not be required to register as an "Investment Company" under the Investment
Company Act, or (iii) to add covenants, restrictions or obligations of the
Sponsor; provided, however, that such action shall not adversely affect in any
material respect the interests of any Holder of Securities, and any amendments
of the Declaration shall become effective when notice thereof is given to the
holders of the Securities. Under the circumstances referred to in Section
10.1(c) of the Declaration, the Declaration may be amended by the Trustees and
the Sponsor with (i) the consent of Holders representing a Majority in
liquidation amount of all outstanding Securities, and (ii) receipt by the
Trustees of an Opinion of Counsel to the effect that such amendment or the
exercise of any power granted to the Trustees in accordance with such amendment
will not affect the Trust's status as a grantor trust for United States federal
income tax purposes or the Trust's exemption from status as an Investment
Company under the Investment Company Act, provided that, (A) without the consent
of each Holder of the Securities, the Declaration may not be amended to (i)
change the amount or timing of any Distribution on the Securities or otherwise
adversely affect the amount of any Distribution required to be made in respect
of the Securities as of a specified date, (ii) restrict the right of a Holder of
the Securities to institute suit for the enforcement of any such payment on or
after such date and (B) without the consent of each Holder of Preferred
Securities, the Declaration may not be amended to restrict the right of a Holder
of Preferred Securities to bring a Direct Action.
8. Pro Rata.
A reference in these terms of the Securities to any payment,
distribution or treatment as being "Pro Rata" shall mean pro rata to each Holder
according to the aggregate liquidation amount of the Securities held by the
relevant Holder in relation to the aggregate liquidation amount of all
Securities outstanding unless, in relation to a payment, an Event of Default
under the Declaration has occurred and is continuing, in which case any funds
available to make such payment shall be paid first to each Holder of the
Preferred Securities pro rata according to the aggregate liquidation amount of
Preferred Securities held by the relevant Holder relative to the aggregate
liquidation amount of all Preferred Securities outstanding, and only after
satisfaction of all amounts owed to the Holders of the Preferred Securities, to
each Holder of Common Securities pro rata according to the aggregate liquidation
amount of Common Securities held by the relevant Holder relative to the
aggregate liquidation amount of all Common Securities outstanding. In any such
proration the Trust may make such adjustments as may be appropriate in order
that only Securities in authorized denominations shall be redeemed.
9. Ranking.
The Preferred Securities rank pari passu with the Common Securities and
payment thereon shall be made Pro Rata with the Common Securities, except that,
if an Event of Default under the Declaration occurs and is continuing, no
payments in respect of Distributions on, or payments upon liquidation,
redemption, repurchase or otherwise with respect to, the Common Securities shall
be made until the Holders of the Preferred Securities shall be paid in full in
cash the Distributions, Redemption Price, Liquidation Distribution and other
payments to which they are entitled at such time.
10. Acceptance of Securities Guarantee and Note.
Each Holder of Securities, by the acceptance thereof, agrees to the
provisions of the Preferred Securities Guarantee including the subordination
provisions therein and to the provisions of the Note.
11. No Preemptive Rights.
The Holders of the Securities shall have no preemptive rights to
subscribe for any additional securities.
12. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration or the Preferred
Securities Guarantee (as may be appropriate) and the Note (including any
supplemental Note) to a Holder without charge on written request to the Sponsor
at its principal place of business.
EXHIBIT A-1
FORM OF PREFERRED SECURITY CERTIFICATE
[FORM OF FACE OF SECURITY]
THIS PREFERRED SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS OR ANY
OTHER APPLICABLE SECURITIES LAW. NEITHER THIS PREFERRED SECURITY NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION
OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
Certificate Number __________________
Aggregate Liquidation Amount Preferred Securities: $ ________
Certificate Evidencing Preferred Securities
of
FBL Financial Group Capital Trust
5% Preferred Securities
(liquidation amount $1,000 per Preferred Security)
FBL Financial Group Capital Trust, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that
______________ (the "Holder") is the registered owner of ____________ Preferred
Securities representing undivided beneficial interests in the assets of the
Trust designated the 5% Preferred Securities (liquidation amount $1,000 per
Preferred Security) (the "Preferred Securities"). Subject to the Declaration (as
defined below), the Preferred Securities are transferable on the books and
records of the Trust, in person or by a duly authorized attorney, upon surrender
of this certificate duly endorsed and in proper form for transfer. The
designation, rights, privileges, restrictions, preferences and other terms and
provisions of the Preferred Securities represented hereby are issued and shall
in all respects be subject to the provisions of the Declaration of Trust of the
Trust dated as of _____ ___, 1997, as the same may be amended from time to time
(the "Declaration"), including the designation of the terms of the Preferred
Securities as set forth in Annex I to the Declaration. Capitalized terms used
but not defined herein shall have the meaning given them in the Declaration. The
Sponsor will provide a copy of the Declaration, the Preferred Securities
Guarantee and the Note to a Holder without charge upon written request to the
Trust at its principal place of business.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder and to the benefits of
the Preferred Securities Guarantee to the extent provided therein.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Notes as indebtedness and the Preferred Securities as
evidence of indirect beneficial ownership in the Notes.
IN WITNESS WHEREOF, the Trust has executed this certificate this ____
day of __________, ____.
FBL FINANCIAL GROUP CAPITAL TRUST
By:______________________________
Name:
Administrative Trustee
ADMINISTRATIVE TRUSTEES'S CERTIFICATE OF AUTHENTICATION
This is one of the Preferred Securities referred to in the
within-mentioned Declaration.
Dated: ____________________, ____
By:______________________________
Name:
Administrative Trustee
FORM OF REVERSE OF SECURITY
Distributions payable on each Preferred Security will be fixed at a
rate per annum of 5% (the "Interest Rate") of the liquidation amount of $1,000
per Preferred Security, such rate being the rate of interest payable on the
Notes to be held by the Administrative Trustees. Except for Distributions which
are deferred as provided below, Distributions in arrears for more than one
quarterly period will bear interest thereon compounded quarterly at the Interest
Rate (to the extent permitted by applicable law). The term "Distributions", as
used herein, includes such cash distributions and any such interest payable
unless otherwise stated. A Distribution is payable only to the extent that
payments are made in respect of the Notes held by the Administrative Trustees
and to the extent the Administrative Trustees have funds legally available
therefor.
Distributions on the Preferred Securities will be cumulative, will
accumulate from the most recent date to which Distributions have been paid or
duly provided for or, if no Distributions have been paid or duly provided for,
from _____ ___, 1997 and will be payable quarterly in arrears, on March 31, June
30, September 30 and December 31 of each year, commencing on Junu 30, 1997,
except as otherwise described below. Distributions will be computed on the basis
of a 360-day year consisting of twelve 30-day months and, for any period less
than a full calendar month, the number of days elapsed in such month. As long as
no Event of Default has occurred and is continuing under the Note, the Note
Issuer has the right under the Note to defer payments of interest by extending
the interest payment period at any time and from time to time on the Notes for a
period not exceeding 20 consecutive calendar quarterly periods, including the
first such quarterly period during such extension period (each an "Extension
Period"), provided that no Extension Period shall end on a day other than an
Interest Payment Date for the Notes or shall extend beyond the Maturity Date of
the Notes. As a consequence of such deferral of payments of interest on the
Notes, Distributions will also be deferred. Prior to the termination of any such
Extension Period, the Note Issuer may further defer payments of interest by
further extending such Extension Period; provided that such Extension Period,
together with all such previous and further extensions within such Extension
Period, may not exceed 20 consecutive quarterly periods, including the first
quarterly period during such Extension Period, or extend beyond the Maturity
Date of the Notes. Payments of accumulated Distributions will be payable to
Holders as they appear on the books and records of the Trust on the first record
date preceding the end of the Extension Period. Upon the termination of any
Extension Period and the payment of all amounts then due, the Note Issuer may
commence a new Extension Period, subject to the above requirements.
Subject to certain conditions set forth in the Declaration and the
Note, the Administrative Trustees may, at the direction of the Sponsor, at any
time liquidate the Trust and cause the Notes to be distributed to the holders of
the Securities in liquidation of the Trust or, simultaneous with any prepayment
of the Notes, cause a Like Amount of the Securities to be redeemed by the Trust.
The Preferred Securities shall be redeemable as provided in the
Declaration.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this
Preferred Security Certificate to:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
______________________________________________________________ agent to transfer
this Preferred Security Certificate on the books of the Trust. The agent may
substitute another to act for him or her.
Date: ____________________________ Signature:________________________
(Sign exactly as your name appears on the other side of this Preferred Security
Certificate)
Signature Guarantee/***/:
_________________________________________
/***/ Signature must be guaranteed by an "eligible guarantor institution" that
is a bank, stockbroker, savings and loan association or credit union meeting the
requirements of the Trustees, which requirements include membership or
participation in the Securities Transfer Agents Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Trustees in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
_________________________________________
Signature
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE
THIS COMMON SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS OR ANY OTHER
APPLICABLE SECURITIES LAW. NEITHER THIS COMMON SECURITY NOR ANY INTEREST OR
PARTICIPATION THEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED, OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
Certificate Number________ Number of Common Securities: _______
Aggregate Liquidation Amount $_______
Certificate Evidencing Common Securities
of
FBL Financial Group Capital Trust
5% Common Securities
(liquidation amount $1,000 per Common Security)
FBL Financial Group Capital Trust, a statutory business trust created
under the laws of the State of Delaware (the "Trust"), hereby certifies that
_______________________ (the "Holder") is the registered owner of _____ Common
Securities of the Trust representing undivided beneficial interests in the
assets of the Trust designated the 5% Common Securities (liquidation amount
$1,000 per Common Security) (the "Common Securities"). Subject to the
limitations in Section 7.1(c) of the Declaration (as defined below), the Common
Securities are transferable on the books and records of the Trust, in person or
by a duly authorized attorney, upon surrender of this certificate duly endorsed
and in proper form for transfer. The designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Common
Securities represented hereby are issued and shall in all respects be subject to
the provisions of the Declaration of Trust of the Trust dated as of ______ ___,
1997, as the same may be amended from time to time (the "Declaration"),
including the designation of the terms of the Common Securities as set forth in
Annex I to the Declaration. Capitalized terms used but not defined herein shall
have the meaning given them in the Declaration. The Sponsor will provide a copy
of the Declaration and the Note (including any supplemental Note) to a Holder
without charge upon written request to the Sponsor at its principal place of
business.
Upon receipt of this certificate, the Sponsor is bound by the
Declaration to the extent provided therein.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Notes as indebtedness and the Common Securities as
evidence of indirect beneficial ownership in the Notes.
IN WITNESS WHEREOF, the Trust has executed this certificate this ___
day of ____________, ____.
FBL FINANCIAL GROUP CAPITAL TRUST
By: _____________________________
Name:
Administrative Trustee
[SIGNATURE PAGE OF FORM OF COMMON SECURITY CERTIFICATE]
FORM OF REVERSE OF SECURITY
Distributions payable on each Common Security will be fixed at a rate
per annum of 5% (the "Interest Rate") of the liquidation amount of $1,000 per
Common Security, such rate being the rate of interest payable on the Notes to be
held by the Administrative Trustees. Except for Distributions which are deferred
as provided below, Distributions in arrears for more than one quarterly period
will bear interest thereon compounded quarterly at the Interest Rate (to the
extent permitted by applicable law). The term "Distributions", as used herein,
includes such cash distributions and any such interest payable unless otherwise
stated. A Distribution is payable only to the extent that payments are made in
respect of the Notes held by the Administrative Trustees and to the extent the
Administrative Trustees have funds legally available therefor.
Distributions on the Common Securities will be cumulative, will accrue
from the most recent date to which Distributions have been paid or duly provided
for or, if no Distributions have been paid or duly provided for, from June 1,
1997 and will be payable quarterly in arrears, on March 31, June 30, September
30 and December 31 of each year, commencing on _____ +-___, 1997, except as
otherwise described below. Distributions will be computed on the basis of a
360-day year consisting of twelve 30-day months and, for any period less than a
full calendar month, the number of days elapsed in such month. As long as no
Event of Default has occurred and is continuing under the Note, the Note Issuer
has the right under the Note to defer payments of interest by extending the
interest payment period at any time and from time to time on the Notes for a
period not exceeding 20 consecutive calendar quarterly periods, including the
first such quarterly period during such extension period (each an "Extension
Period"), provided that no Extension Period shall end on a day other than an
Interest Payment Date for the Notes or extend beyond the Maturity Date of the
Notes. As a consequence of such deferral of payments of interest on the Notes,
Distributions will also be deferred. Prior to the termination of any such
Extension Period, the Note Issuer may further defer payments of interest by
further extending such Extension Period; provided that such Extension Period,
together with all such previous and further extensions within such Extension
Period, may not exceed 20 consecutive quarterly periods, including the first
quarterly period during such Extension Period, or extend beyond the Maturity
Date of the Notes. Payments of accrued Distributions will be payable to Holders
as they appear on the books and records of the Trust on the first record date
preceding the end of the Extension Period. Upon the termination of any Extension
Period and the payment of all amounts then due, the Note Issuer may commence a
new Extension Period, subject to the above requirements.
Subject to certain conditions set forth in the Declaration and the
Note, the Administrative Trustees may, at the direction of the Sponsor, at any
time liquidate the Trust and cause the Notes to be distributed to the holders of
the Securities in liquidation of the Trust or, simultaneous with any prepayment
of the Notes, cause a Like Amount of the Securities to be redeemed by the Trust.
The Common Securities shall be redeemable as provided in the
Declaration.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Common
Security certificate to:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert assignee's social security or tax identification number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
_______________________________________________________________ agent to
transfer this Common Security certificate on the books of the Trust. The agent
may substitute another to act for him or her.
Date: ________________________
Signature: ___________________
(Sign exactly as your name appears on the other side of this Common Security
Certificate)
Signature Guarantee/***/:
_________________________________________
/***/ Signature must be guaranteed by an "eligible guarantor institution" that
is a bank, stockbroker, savings and loan association or credit union meeting the
requirements of the Trustees, which requirements include membership or
participation in the Securities Transfer Agents Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities and Exchange Act of 1934, as amended.
_________________________________________
Signature
EXHIBIT 4.4
FBL FINANCIAL GROUP, INC.
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SUBORDINATED DEFERRABLE INTEREST
NOTE AGREEMENT
DATED AS OF MAY 30, 1997
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SUBORDINATED DEFERRABLE INTEREST NOTE AGREEMENT
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions
Administrative Trustees
Affiliate
Board of Directors
Business Day
Commission
Common Securities
Company
Declaration
Default
Deferred Interest
Delaware Trustee
Direct Action
Dissolution Event
Distributions
Event of Default
Exchange Act
Extended Interest Payment Period
Indebtedness
Indebtedness Ranking Junior to the Notes
Indebtedness Ranking on a Parity with the Note
Interest Payment Date
Issue Date
Junior Subordinated Payment
Maturity Date
Note
Noteholder or Holder of Notes
Officers
Officers' Certificate
Opinion of Counsel
Person
Predecessor Note
` Preferred Securities
Preferred Securities Guarantee
Purchase Agreement
Restricted Security
Securities Act
Senior Indebtedness
Subsidiary
Trust
Trust Securities
ARTICLE II
SECURITIES
SECTION 2.01. Forms of Note
SECTION 2.02. Execution
SECTION 2.03. Form and Payment
SECTION 2.04. Legend
SECTION 2.05. Interest
SECTION 2.06. Transfer Restrictions, Transfer and Exchange
SECTION 2.07. Replacement Securities
SECTION 2.08. Ranking
SECTION 2.09. Defaulted Interest
ARTICLE III
PARTICULAR COVENANTS OF THE COMPANY
SECTION 3.01. Payment of Principal, Premium and Interest
SECTION 3.02. Limitation on Dividends and Payments
SECTION 3.03. Payment of Expenses
SECTION 3.04. Payment Upon Resignation or Removal
ARTICLE IV
NOTEHOLDERS' LISTS AND REPORTS BY THE COMPANY
SECTION 4.01. Noteholders' Lists
SECTION 4.02. Reports by the Company
ARTICLE V
REMEDIES OF NOTEHOLDERS ON EVENT OF DEFAULT
SECTION 5.01. Events of Default
SECTION 5.02. Payment of Notes on Default; Suit Therefor
SECTION 5.03. Proceedings by Noteholders
SECTION 5.04. Remedies Cumulative and Continuing
SECTION 5.05. Direction of Proceedings and Waiver of Defaults by Majority of
Noteholders
SECTION 5.06. Notice of Defaults
SECTION 5.07. Undertaking to Pay Costs
ARTICLE VI
CONCERNING THE NOTEHOLDERS
SECTION 6.01. Action by Noteholders
SECTION 6.02. Notes Owned by Company Deemed not Outstanding
SECTION 6.03. Revocation of Consents; Future Holders Bound
ARTICLE VII
NOTEHOLDERS' MEETINGS
SECTION 7.01. Purpose of Meetings
SECTION 7.02. Call of Meetings by Company or Noteholders
SECTION 7.03. Qualifications for Voting
SECTION 7.04. Regulations
SECTION 7.05. Voting
ARTICLE VIII
AMENDMENTS
SECTION 8.01. Without Consent of Noteholders
SECTION 8.02. With Consent of Noteholders
SECTION 8.03. Notation on Notes
ARTICLE IX
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
SECTION 9.01. Company May Consolidate, etc., Only on Certain Terms
SECTION 9.02. Successor Person Submitted
ARTICLE X
SATISFACTION AND DISCHARGE OF NOTE
SECTION 10.01. Discharge of Note Agreement
SECTION 10.02. Deposited Moneys and U.S. Government Obligations to be Held in
Trust by Trustees
SECTION 10.03. Paying Agent to Reply Moneys Held
SECTION 10.04. Return of Unclaimed Moneys
SECTION 10.05. Defeasance Upon Deposit of Moneys or U.S. Government Obligations
ARTICLE XI
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
SECTION 11.01. Note Agreement and Notes Solely Corporate Obligations
ARTICLE XII
MISCELLANEOUS PROVISIONS
SECTION 12.01. Successors
SECTION 12.02. Official Acts by Successor Corporation
SECTION 12.03. Surrender of Company Powers
SECTION 12.04. Addresses for Notices, etc.
SECTION 12.05. Governing Law
SECTION 12.06. Evidence of Compliance with Conditions Precedent
SECTION 12.07. Business Days
SECTION 12.08. Table of Contents, Headings, etc.
SECTION 12.09. Execution in Counterparts
SECTION 12.10. Separability
SECTION 12.11. Assignment
ARTICLE XIII
SUBORDINATION OF NOTES
SECTION 13.01. Agreement to Subordinate
SECTION 13.02. Default on Senior Indebtedness
SECTION 13.03. Prior Payment to Senior Indebtedness Upon Acceleration of Notes
SECTION 13.04. Liquidation; Dissolution; Bankruptcy
SECTION 13.05. Subrogation
SECTION 13.06. Company to Effectuate Subordination
SECTION 13.07. Notice by the Company
SECTION 13.08. Subordination May Not be Impaired
THIS SUBORDINATED DEFERRABLE INTEREST NOTE AGREEMENT, (the "Note
Agreement") dated as of May 30, 1997, between FBL Financial Group, Inc., an Iowa
corporation (hereinafter sometimes called the "Company"), and FBL Financial
Group Capital Trust (hereinafter sometimes called the holder).
W I T N E S S E T H :
In consideration of the premises, and the purchase of the Note by the
holder thereof, the Company covenants and agrees with the holders from time to
time of the Notes as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions.
The terms defined in this Section 1.01 (except as herein otherwise
expressly provided or unless the context otherwise requires) for all purposes of
this Note Agreement shall have the respective meanings specified in this Section
1.01. All accounting terms used herein and not expressly defined shall have the
meanings assigned to such terms in accordance with generally accepted accounting
principles and the term "generally accepted accounting principles" means such
accounting principles as are generally accepted at the time of any computation.
The words "herein", "hereof" and "hereunder" and other words of similar import
refer to this Note Agreement as a whole and not to any particular Article,
Section or other subdivision. Headings are used for convenience of reference
only and do not affect interpretation. The singular includes the plural and vice
versa.
"Administrative Trustees" shall have the same meaning as set forth in
the Declaration.
"Affiliate" means, with respect to a specified Person, any Person
directly or indirectly controlling, controlled by, or under common control with
the specified Person. For the purposes of this definition, "control" when used
with respect to any specified Person means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Board of Directors" shall mean either the Board of Directors of the
Company or any duly authorized committee of that board.
"Business Day" shall mean, with respect to the Notes, any day other
than a Saturday or a Sunday or a day on which banking institutions in Des
Moines, Iowa and Wilmington, Delaware are authorized or required by law or
executive order to close.
"Commission" shall mean the Securities and Exchange Commission, as from
time to time constituted.
"Common Securities" shall mean common undivided beneficial interests in
the assets of the Trust.
"Company" shall mean FBL Financial Group, Inc., an Iowa corporation,
and, subject to the provisions of Article IX, shall include its successors and
assigns.
"Declaration" means the Declaration of Trust dated as of May 30, 1997
establishing the FBL Financial Group Capital Trust, among the Company as
Sponsor, the Trustees named therein and the holders, from time to time, of
undivided beneficial interests in the assets of the Trust..
"Default" means any event, act or condition that with notice or lapse
of time, or both, would constitute an Event of Default.
"Deferred Interest" shall have the meaning set forth in Section 14.01.
"Delaware Trustee" shall have the same meaning as set forth in the
Declaration.
"Direct Action" shall have the meaning set forth in Section 5.03.
"Dissolution Event" means the liquidation of the Trust pursuant to the
Declaration, and the distribution of the Notes held by the Administrative
Trustees to the holders of the Trust Securities issued by the Trust pro rata in
accordance with the Declaration.
"Distributions" shall have the same meaning as set forth in the
Declaration.
"Event of Default" shall mean any event specified in Section 5.01,
continued for the period of time, if any, and after the giving of the notice, if
any, therein designated.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Extended Interest Payment Period" shall have the meaning set forth in
Section 14.01.
"Indebtedness" shall mean (i) any obligation of, or any obligation
guaranteed by, the Company for which the Company is responsible or liable as
obligor or otherwise including principal, premium and interest (whether accruing
before or after filing of any petition in bankruptcy or any similar proceedings
by or against the Company and whether or not allowed as a claim in bankruptcy or
similar proceedings) for (A) indebtedness of the Company for money borrowed, (B)
indebtedness evidenced by securities, bonds, Notes, notes or other similar
written instruments, (C) any deferred obligation for the payment of the purchase
price or conditional sale obligation of property or assets acquired other than
in the ordinary course of business, (D) all obligations of the Company for the
reimbursement of any letter of credit, banker's acceptance, security purchase
facility or similar credit transaction, (E) all obligations of the Company under
"keep-well" agreements required by insurance regulators or (F) any obligation
referred to in (A) through (E) above of other persons secured by any lien on any
property or asset of the Company and (ii) all indebtedness of the Company for
obligations of the Company to make payment in respect of derivative products
such as interest and foreign exchange rate contracts, commodity contracts
(including future or options contracts), swap agreements, cap agreements,
repurchase and reverse repurchase agreements and similar arrangements, whether
outstanding on the date of execution of the Note or thereafter created, assumed
or incurred.
"Indebtedness Ranking Junior to the Note" shall mean any Indebtedness,
whether outstanding on the date of execution of the Note or thereafter created,
assumed or incurred, which specifically by its terms is subordinated and ranks
junior to and not equally with or prior to the Note (and any other Indebtedness
Ranking on a Parity with the Note) in right of payment upon the happening of any
dissolution or winding up or liquidation or reorganization or similar events of
the Company. The securing of any Indebtedness, otherwise constituting
Indebtedness Ranking Junior to the Note, shall not be deemed to prevent such
Indebtedness from constituting Indebtedness Ranking Junior to the Note.
"Indebtedness Ranking on a Parity with the Note" shall mean
Indebtedness, whether outstanding on the date of execution of the Note or
thereafter created, assumed or incurred, which specifically by its terms ranks
equally with and not prior to the Note in the right of payment upon the
happening of any dissolution or winding up or liquidation or reorganization or
similar events of the Company. The securing of any Indebtedness, otherwise
constituting Indebtedness Ranking on a Parity with the Note, shall not be deemed
to prevent such Indebtedness from constituting Indebtedness Ranking on a Parity
with the Note.
"Interest Payment Date" shall have the meaning set forth in Section
2.05.
"Issue Date" means May 30, 1997.
"Junior Subordinated Payment" shall have the meaning set forth in
Section 13.04.
"Maturity Date" shall mean June 30, 2047.
"Note" of "Notes" shall mean the Subordinated Deferrable Interest Note
or Notes, in the form set forth in Article II of this Note Agreement, as
originally executed or, if amended as herein provided, as so amended.
"Note Register" shall mean the list of names and addresses of the
Noteholders maintained by the Company pursuant to Section 4.01.
"Noteholder", "Holder of Notes", or other similar terms, shall mean any
Person in whose name at the time a particular Note is registered on the register
kept by the Company for that purpose in accordance with the terms hereof.
"Officers" shall mean any of the Chairman, a Vice Chairman, the Chief
Executive Officer, the President, a Vice President, the Comptroller, the
Secretary or an Assistant Secretary of the Company.
"Officers' Certificate" shall mean a certificate signed by two Officers
and delivered to the Noteholders.
"Opinion of Counsel" shall mean a written opinion, acceptable to the
Administrative Trustees, of counsel, who may be an employee of the Company, and
who shall be acceptable to the holders.
"Person" shall mean any individual, corporation, estate, partnership,
joint venture, association, joint-stock company, limited liability company,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Predecessor Note" of any particular Note means every previous Note
evidencing all or a portion of the same debt as that evidenced by such
particular Note; and, for the purposes of this definition, any Note delivered
under Section 2.08 in lieu of a lost, destroyed or stolen Note shall be deemed
to evidence the same debt as the lost, destroyed or stolen Note.
"Preferred Securities" shall mean the 5% Preferred Securities of the
Trust, each having a stated liquidation amount of $1,000, and representing
preferred undivided beneficial interests in the assets of the Trust.
"Preferred Securities Guarantee" shall mean any guarantee that the
Company may enter into that operates directly or indirectly for the benefit of
holders of Preferred Securities of the Trust.
"Purchase Agreement" shall mean the Purchase Agreement dated May 30,
1997, among the Company, the Trust and the Iowa Farm Bureau Federation.
"Restricted Security" shall mean Notes that bear or are required to
bear the Securities Act legends substantially as set forth in Exhibit A-1 of
Annex 1 of the Declaration.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Senior Indebtedness" shall mean all Indebtedness, whether outstanding
on the date of execution of the Note or thereafter created, assumed or incurred,
except Indebtedness Ranking on a Parity with the Notes or Indebtedness Ranking
Junior to the Notes, and any deferrals, modifications, renewals, refinancings or
extensions of such Senior Indebtedness.
"Subsidiary" shall mean, with respect to any Person, (i) any
corporation at least a majority of whose outstanding voting stock is owned,
directly or indirectly, by such Person or by one or more of its Subsidiaries, or
by such Person and one or more of its Subsidiaries, (ii) any general
partnership, joint venture or similar entity, at least a majority of whose
outstanding partnership or similar interests shall at the time be owned by such
Person, or by one or more of its Subsidiaries, or by such Person and one or more
of its Subsidiaries and (iii) any limited partnership of which such Person or
any of its Subsidiaries is a general partner. For the purposes of this
definition, "voting stock" means shares, interests, participations or other
equivalents in the equity interest (however designated) in such Person having
ordinary voting power for the election of a majority of the directors (or the
equivalent) of such Person, other than shares, interests, participations or
other equivalents having such power only by reason of the occurrence of a
contingency.
Trust" shall mean FBL Financial Group Capital Trust, a Delaware
business trust created under the Declaration for the purpose of issuing its
undivided beneficial interests in connection with the issuance of Securities
under this Note Agreement.
"Trust Securities" shall mean, collectively, the Preferred Securities
and the Common Securities.
ARTICLE II
SECURITIES
SECTION 2.01 Form of Note.
(a) The face of the Note to be issued pursuant to the terms of this
Note Agreement shall be in the following form:
FBL Financial Group, Inc., an Iowa corporation (the "Company"), for
value received, hereby promises to pay to FBL Financial Group Capital Trust or
registered assigns, the principal sum of One Hundred Million Dollars
($100,000,000.00) on June 30, 2047 (the "Maturity Date"), unless previously
prepaid, and to pay interest on the outstanding principal amount hereof from
May 30, 1997, or from the most recent interest payment date (each such date, an
"Interest Payment Date") to which interest has been paid or duly provided for,
quarterly (subject to deferral as set forth herein) in arrears on March 31, June
30, September 30 and December 31 of each year, commencing June 30, 1997 at the
rate of 5% per annum until the principal hereof shall have become due and
payable, and at the same rate per annum on any overdue principal and premium, if
any. The amount of interest payable on any Interest Payment Date shall be
computed on the basis of a 360-day year of twelve 30-day months and, for any
period less than a full calendar month, the actual number of days elapsed in
such month. In the event that any date on which the principal of (or premium, if
any) or interest on this Note is payable is not a Business Day, then the payment
payable on such date will be made on the next succeeding day that is a Business
Day (and without any interest or other payment in respect of any such delay), in
each case, with the same force and effect as if made on the date such payment
was originally payable.
The interest installment so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, be paid to the Person in whose
name this Note is registered at the close of business on the regular record date
for such interest installment, which shall be the fifteenth (15th) day of the
month preceding the month in which the relevant Interest Payment Date falls.
Notwithstanding the foregoing, any interest that is payable on the Maturity Date
will be payable to the Person to whom principal payable at the Maturity Date
shall be payable. Any such interest installment not punctually paid or duly
provided for shall forthwith cease to be payable to the holders on such regular
record date and may be paid to the Person in whose name this Note (or one or
more Predecessor Notes) is registered at the close of business on a special
record date to be fixed by the Company for the payment of such defaulted
interest, notice whereof shall be given to the holders of Note not less than 10
days prior to such special record date.
The principal of (and premium, if any) and interest on this Note shall
be payable by (i) check mailed to the holder at such address as shall appear in
the Note Register or (ii) by transfer to an account maintained by the Person
entitled thereto, provided that proper written transfer instructions have been
received by the relevant record date. Payment of principal of this Note shall
only be made upon surrender of this Note to the Company.
The indebtedness evidenced by this Note is, to the extent provided in
the Note Agreement, subordinate and junior in right of payment to the prior
payment in full of all Senior Indebtedness, and this Note is issued subject to
the provisions of the Note Agreement with respect thereto. Each holder of this
Note, by accepting the same, (a) agrees to and shall be bound by such
provisions. Each holder hereof, by his or her acceptance hereof hereby (b)
waives all notice of the acceptance of the subordination provisions contained
herein and in the Note Agreement by each holder of Senior Indebtedness, whether
now outstanding or hereafter incurred, and waives reliance by each such holder
upon said provisions.
The provisions of this Note are continued on the reverse side hereof
and such provisions shall for all purposes have the same effect as though fully
set forth at this place.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed as of the date set forth below.
Dated: ____________________, 1997
FBL Financial Group, Inc.
By: _____________________________ By: _____________________________
Name: ___________________________ Name: ___________________________
Title: __________________________ Title: __________________________
(b) The form of the reverse side of the Note shall be as follows:
This Note is one of the Subordinated Deferrable Interest Notes of the
Company (herein sometimes referred to as the "Notes"), specified in the Note
Agreement, issued or to be issued under and pursuant to a Subordinated
Deferrable Interest Note Agreement, dated as of May 31, 1997 (the "Note
Agreement"), duly executed and delivered between the Company and FBL Financial
Group Capital Trust (the "Trust"), to which Note Agreement reference is hereby
made for a description of the rights, limitations of rights, obligations, duties
and immunities thereunder of the Trust, the Company and the holders of the
Notes, and to all of which provisions the holder of this Note, by acceptance
hereof, assents and agrees.
In case an Event of Default, as defined in the Note Agreement, shall
have occurred and be continuing, the principal of all of the Notes may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Note
Agreement.
No reference herein to the Note Agreement and no provision of this Note
shall alter or impair the obligation of the Company, which is absolute and
unconditional, to pay the principal of and premium, if any, and interest on this
Note at the time and place and at the rate herein prescribed.
The Company shall have the right, at any time and from time to time
during the term of the Note, to defer payments of interest by extending the
interest payment period of such Securities for a period not exceeding 20
consecutive quarterly periods, including the first such quarterly period during
such extension period, and not to extend beyond the Maturity Date of the Note
(an "Extended Interest Payment Period"), at the end of which period the Company
shall pay all interest then accrued and unpaid. Before the termination of any
such Extended Interest Payment Period, the Company may further defer payments of
interest by further extending such Extended Interest Payment Period, provided
that such Extended Interest Payment Period, together with all such previous and
further extensions within such Extended Interest Payment Period, shall not
exceed 20 consecutive quarterly periods, including the first quarterly period
during such Extended Interest Payment Period, shall not end on any date other
than an Interest Payment Date or extend beyond the Maturity Date of the Note.
Upon the termination of any such Extended Interest Payment Period and the
payment of all accrued and unpaid interest and any additional amounts then due,
the Company may commence a new Extended Interest Payment Period, subject to the
foregoing requirements.
The Company has agreed that it will not (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Company's capital stock (which
includes Class A Common, Class B Common, and preferred stock) or (ii) make any
payment of principal, interest or premium, if any, on or repay or repurchase or
redeem any debt securities of the Company that rank pari passu with or junior in
right of payment to the Notes or (iii) make any guarantee payments with respect
to any guarantee by the Company of any securities of any Subsidiary of the
Company if such guarantee ranks pari passu or junior in right of payment to the
Note (other than (a) dividends or distributions in shares of, or options,
warrants or rights to subscribe for or purchase shares of, common stock of the
Company; (b) any declaration of a dividend in connection with the implementation
of a stockholder's rights plan, or the issuance of stock under any such plan in
the future, or the redemption or repurchase of any such rights pursuant thereto;
(c) payments under the Preferred Securities Guarantee; (d) as a direct result
of, and only to the extent required in order to avoid the issuance of fractional
shares of capital stock following, a reclassification of the Company's capital
stock or the exchange or the conversion of one class or series of the Company's
capital stock for another class or series of the Company's capital stock or
pursuant to an acquisition in which the fractional shares of the Company's
capital stock would otherwise be issued; (e) the purchase of fractional
interests in shares of the Company's capital stock pursuant to the exchange or
conversion provisions of such capital stock or the security being exchanged or
converted; and (f) purchases of common stock related to the issuance of common
stock or rights under any benefit plan for directors, officers, agents or
employees of the Company, its Affiliates, or its Subsidiaries or any of the
Company's dividend reinvestment or director, officer, agent or employee stock
purchase plans), if at such time (1) an Event of Default shall have occurred and
be continuing, or would occur upon the taking of any action specified in clauses
(i) through (iii) above, (2) there shall have occurred any event of which the
Company has actual knowledge that (a) with the giving of notice or the lapse of
time, or both, would be an Event of Default and (b) in respect of which the
Company shall not have taken reasonable steps to cure, (3) the Company shall be
in default with respect to its payment obligations under the Preferred
Securities Guarantee or (4) the Company shall have given notice of its election
of the exercise of its right to extend the interest payment period under the
Note Agreement and any such extension shall not have been rescinded or such
Extended Interest Payment Period, or any extension thereof, shall be continuing.
The Company and the holder agree (i) that for United Stated federal,
state and local tax purposes it is intended that this Note constitutes
indebtedness and (ii) to file all United States federal, state and local tax
returns and reports on such basis (unless the Company or holder, as the case may
be, shall have received an opinion of independent tax counsel experienced in
such matters to the effect that as a result of change in law after the date of
issuance of this Note the Company or the holder, as the case may be, is
prohibited from filing on such basis).
The Note may be issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Note Agreement and subject to the transfer restrictions as may be contained
therein and herein from time to time, this Note is transferable by the holder
hereof on the Note Register of the Company, upon surrender of this Note for
registration of transfer at the office or agency of the Company accompanied by a
written instrument or instruments of transfer in form satisfactory to the
Company duly executed by the holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Notes of authorized denominations and for
the same aggregate principal amount will be issued to the designated transferee
or transferees. No service charge will be made for any such transfer, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge payable in relation thereto.
Prior to due presentment for registration of transfer of this Note, the
Company may deem and treat the holder hereof as the absolute owner hereof for
the purpose of receiving payment of or on account of the principal hereof and
premium, if any, and (subject to the Note Agreement) interest due hereon and for
all other purposes, and neither the Company nor any authenticating agent nor any
paying agent nor any transfer agent shall be affected by any notice to the
contrary.
No recourse shall be had for the payment of the principal of or
premium, if any, or interest on this Note, or for any claim based hereon, or
otherwise in respect hereof, or based on or in respect of the Note Agreement
against any incorporator, stockholder, officer or director, past, present or
future, as such, of the Company or of any predecessor or successor Person,
whether by virtue of any constitution, statute, or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such liability being,
by the acceptance hereof and as part of the consideration for the issuance
hereof, expressly waived and released.
All terms used in this Note that are defined in the Note Agreement
shall have the meanings assigned to them in the Note Agreement. The Notes may
have notations, legends or endorsements required by law, agreements to which the
Company is subject or usage. Each Note shall be dated the date of its execution.
The Note shall initially be issued as a single Note in the denomination of One
Hundred Million Dollars ($100,000,000). Replacement or substitute Notes shall be
issued in denominations of $1,000 and integral multiples thereof.
SECTION 2.02. Execution.
Two Officers shall sign the Notes for the Company by manual or
facsimile signature.
SECTION 2.03. Form and Payment.
Except as provided in Section 2.05, the Notes shall be issued in fully
registered, certificated form without interest coupons. Principal of, premium,
if any, and interest on the Notes issued in certificated form will be payable,
the transfer of such Notes will be registrable and such Notes will be
exchangeable for Notes bearing identical terms and provisions at the office or
agency of the Company; provided, however, that payment of interest with respect
to the Notes may be made at the option of the Company (i) by check mailed to the
holder at such address as shall appear in the Note Register or (ii) by transfer
to an account maintained by the Person entitled thereto, provided that proper
transfer instructions have been received in writing by the relevant record date.
Notwithstanding the foregoing, so long as the holder of any Notes is the Trust,
the payment of the principal of, premium, if any, and on such Notes held by the
Trust will be made at such place and to such account as may be designated by the
Administrative Trustees. Payment of principal of the Notes shall only be made
upon surrender of the Notes to the Trustee or paying agent.
SECTION 2.04. Legend.
Except as otherwise determined by the Company in accordance with
applicable law, each Note shall bear the applicable legend relating to
restrictions on transfer pursuant to the securities laws in substantially the
form set forth at Exhibit A-1 of Annex 1 of the Declaration.
SECTION 2.05. Interest.
(a) Each Note will bear interest at the rate of 5% per annum (the
"Interest Rate") from the most recent date to which interest has been paid or
duly provided for or, if no interest has been paid or duly provided for, from
the Issue Date, until the principal thereof becomes due and payable, and at the
Interest Rate on any overdue principal (and premium, if any), payable quarterly
in arrears on March 31, June 30, September 30 and December 31 of each year
(each, an "Interest Payment Date") commencing on June 30, 1997, to the Person in
whose name such Note or any Predecessor Note is registered, at the close of
business on the regular record date for such interest installment, which shall
be the fifteenth (15th) day of the month preceding the month in which the
relevant Interest Payment Date falls. Notwithstanding the foregoing, any
interest that is payable on the Maturity Date shall be payable to the Person to
whom principal payable at the Maturity Date shall be payable.
(b) Interest will be computed on the basis of a 360-day year consisting
of twelve 30-day months and, for any period of less than a full calendar month,
the actual number of days elapsed in such month. In the event that any Interest
Payment Date falls on a day that is not a Business Day, then payment of interest
payable on such date will be made on the next succeeding day which is a Business
Day (and without any interest or other payment in respect of any such delay),
with the same force and effect as if made on the date such payment was
originally payable.
(c) During such time as the Administrative Trustees are the holders of
any Note on behalf of the Trust, the Company shall pay as additional interest
any additional amounts on the Note as may be necessary in order that the amount
of Distributions then due and payable by the Trust on the outstanding Trust
Securities shall not be reduced as a result of any taxes, duties and other
governmental charges to which the Trust has become subject.
SECTION 2.06. Transfer Restrictions, Transfers and Exchanges.
(a) Transfer Restrictions. The Note may not be transferred except in
compliance with the legend referred to in Section 2.04 and may only be
transferred in blocks of Notes having an aggregate principal amount of not less
than $100,000, unless otherwise determined by the Company in accordance with
applicable law.
(b) General Provisions Relating to Transfers and Exchanges. Upon
surrender for registration of transfer of any Note at the office of the Company
identified in Section 12.04, the Company shall execute, and deliver, in the name
of the designated transferee or transferees, one or more new Notes of the same
series, of any authorized denominations and of a like aggregate principal
amount.
Every Note presented or surrendered for registration of transfer or
exchange shall (if so required by the Company) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company, by the holder thereof or his attorney duly authorized in writing.
No service charge shall be made to a holder for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any transfer tax or similar governmental charge payable in connection
therewith.
SECTION 2.07. Replacement Securities.
If any mutilated Note is surrendered to the Company and the Company
receives evidence to its satisfaction of the destruction, loss or theft of any
Note, the Company shall issue a replacement Note if the Company's requirements
for replacements of Notes are met. An indemnity bond must be supplied by the
holder that is sufficient in the judgment of the Company to protect the Company,
from any loss that it may suffer if a Note is replaced. The Company may charge
for its expenses in replacing a Note.
Every replacement Note is an obligation of the Company and shall be
entitled to all of the benefits of this Note Agreement equally and
proportionately with all other Notes duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement of
mutilated, destroyed, lost or stolen Notes.
SECTION 2.08. Ranking.
The Notes shall constitute an unsecured obligation of the Company and
rank (i) subordinate and junior in right of payment to all Senior Indebtedness
(to the extent and in the manner set forth in Article XIII), (ii) pari passu in
right of payment with any other Indebtedness of the Company which specifically
by its terms ranks equal with and not prior to the Notes, and (iii) senior to
any Indebtedness Ranking Junior to the Notes.
SECTION 2.9. Defaulted Interest.
Any interest on any Note that is payable, but is not punctually paid or
duly provided for, on any Interest Payment Date (herein called "Defaulted
Interest") shall forthwith cease to be payable to the holder on the relevant
regular record date; and such Defaulted Interest shall be paid by the Company,
at its election, as provided in clause (a) or clause (b) below:
(a) The Company may make payment of any Defaulted Interest on Notes to
the Persons in whose names such Notes (or their respective Predecessor
Notes) are registered at the close of business on a special record date
for the payment of such Defaulted Interest, which all be fixed in the
following manner: the Company shall notify the holders in writing of
the amount of Defaulted Interest proposed to be paid on each such Note
and the date of the proposed payment, and at the same time the Company
shall deposit in an escrow account for the benefit of the holders an
amount of money equal to the aggregate amount proposed to be paid in
respect of such Defaulted Interest or shall make arrangements for such
deposit prior to the date of the proposed payment, such money when
deposited to be held in escrow for the benefit of the Persons entitled
to such Defaulted Interest as in this clause provided. Thereupon the
Company shall fix a special record date for the payment of such
Defaulted Interest which shall not be more than 15 nor less than 10
days prior to the date of the proposed payment and not less than 10
days after the receipt by the holders of the notice of the proposed
payment. The Company at the expense of the Company, shall cause notice
of the proposed payment of such Defaulted Interest and the special
record date therefor to be mailed, first class postage prepaid, to each
Noteholder at his or her address as it appears in the Note register,
not less than 10 days prior to such special record date. Notice of the
proposed payment of such Defaulted Interest and the special record date
therefor having been mailed as aforesaid, such Defaulted Interest shall
be paid to the Persons in whose names such Notes (or their respective
Predecessor Notes) are registered on such special record date and shall
be no longer payable pursuant to the following clause (b).
(b) The Company may make payment of any Defaulted Interest on any Notes
in any other lawful manner.
ARTICLE III
PARTICULAR COVENANTS OF THE COMPANY
SECTION 3.01. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of the holders of the
Notes that it will duly and punctually pay or cause to be paid the principal of
and premium, if any, and interest on the Notes at the place, at the respective
times and in the manner provided herein. Each installment of interest on the
Notes may be paid by mailing checks for such interest payable to the order of
the holder of the Note entitled thereto as they appear in the Note Register, or
by wire transfer to an account maintained by the Person entitled thereto,
provided proper transfer instructions have been received by the relevant record
date.
SECTION 3.02. Limitation on Dividends and Payments.
The Company will not (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire, or make a liquidation payment with respect to,
any of the Company's capital stock (which includes Class A Common, Class B
Common and preferred stock) or (ii) make any payment of principal, interest or
premium, if any, on or repay or repurchase or redeem any debt securities of the
Company that rank pari passu with or junior in right of payment to the Notes or
(iii) make any guarantee payments with respect to any guarantee by the Company
of any securities of any Subsidiary of the Company if such guarantee ranks pari
passu with or junior in right of payment to the Notes (other than (a) dividends
or distributions in shares of, or options, warrants or rights to subscribe for
or purchase shares of, capital stock of the Company; (b) any declaration of a
dividend in connection with the implementation of a stockholder's rights plan,
or the issuance of stock under any such plan in the future, or the redemption or
repurchase of any such rights pursuant thereto; (c) payments under the Preferred
Securities Guarantee; (d) as a direct result of, and only to the extent required
in order to avoid the issuance of fractional shares of capital stock following,
a reclassification of the Company's capital stock or the exchange or the
conversion of one class or series of the Company's capital stock for another
class or series of the Company's capital stock or pursuant to an acquisition in
which fractional shares of the Company's capital stock would otherwise be
issued; (e) the purchase of fractional interests in shares of the Company's
capital stock pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged; and (f) purchases of common
stock related to the issuance of common stock or rights under any benefit plans
for directors, officers, agents or employees of the Company or its Affiliates or
Subsidiaries, or any of the Company's dividend reinvestment or director,
officer, agent or employee stock purchase plans), if at such time (1) an Event
of Default shall have occurred and be continuing or, would occur upon the taking
of any action described in clauses (i) through (iii) above, (2) there shall have
occurred any event of which the Company has actual knowledge that (a) with the
giving of notice or the lapse of time, or both, would constitute an Event of
Default and (b) in respect of which the Company shall not have taken reasonable
steps to cure, (3) the Company shall be in default with respect to its payment
obligations under the Preferred Securities Guarantee or (4) the Company shall
have given notice of its election of the exercise of its right to extend the
interest payment period pursuant to Article XIV and any such extension shall not
have been rescinded or such Extended Interest Payment Period, or any extension
thereof.
SECTION 3.03. Payment of Expenses.
In connection with the offering, sale and issuance of the Notes to the
Trust and in connection with the sale of the Trust Securities by the Trust, the
Company, in its capacity as borrower with respect to the Notes shall:
(a) pay all costs and expenses relating to the offering, sale and
issuance of the Notes;
(b) pay all costs and expenses of the Trust, including, but not limited
to, costs and expenses relating to the organization of the Trust, the
offering, sale and issuance of the Trust Securities, fees and expenses
of the Administrative Trustees and the Delaware Trustee (including the
fees and expenses of counsel), the costs and expenses relating to the
operation of the Trust, including without limitation, costs and
expenses of accountants, attorneys, statistical or bookkeeping
services, expenses for printing and engraving and computing or
accounting equipment, paying agent(s), registrar(s), transfer agent(s),
duplicating, travel and telephone and other telecommunications expenses
and costs and expenses incurred in connection with the acquisition,
financing and disposition of assets of the Trust;
(c) be primarily and fully liable for any indemnification obligations
arising with respect to the Declaration;
(d) pay any and all taxes (other than United States withholding taxes
attributable to the Trust or its assets) and all liabilities, costs and
expenses with respect to such taxes of the Trust; and
(e) pay all other fees, expenses, debts and obligations (other than
payments of principal of, premium, if any, or interest on the Trust
Securities) related to the Trust.
SECTION 3.04. Payment Upon Resignation or Removal.
Upon termination of the Declaration or the removal or resignation of
the Delaware Trustee or the Administrative Trustees, as the case may be,
pursuant to the Declaration, the Company shall pay to the Delaware Trustee or
the Administrative Trustees, as the case may be, all amounts accrued and owing
to the date of such termination, removal or resignation.
ARTICLE IV
NOTEHOLDERS LISTS AND REPORTS BY THE COMPANY
SECTION 4.01. Noteholders' Lists.
The Company covenants and agrees that it will maintain a list of the
names and addresses of the Noteholders which will be maintained in as current a
form as is reasonably practicable. Within 30 days after the receipt by the
Company of any request therefor by any Noteholder, the Noteholder list will be
furnished to the Noteholder.
SECTION 4.02. Reports by the Company.
The Company covenants and agrees to mail to the Noteholders, within 15
days after the date on which the Company is required to file the same with the
Commission, copies of the annual reports and of the information, documents and
other reports which the Company may be required to file with the Commission
pursuant to Section 13 or Section 15(d) of the Exchange Act.
ARTICLE V
REMEDIES OF THE NOTEHOLDERS ON EVENT OF DEFAULT
SECTION 5.01. Events of Default.
One or more of the following events of default shall constitute an
Event of Default hereunder (whatever the reason for such Event of Default and
whether it shall be voluntary or involuntary or be effected by operation of law
or pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(a) default in the payment of any interest upon any Note when
it becomes due and payable, and continuance of such default for a
period of 30 days; provided, however, that a valid extension of an
interest payment period by the Company in accordance with the terms
hereof shall not constitute a default in the payment of interest for
this purpose; or
(b) default in the payment of all or any part of the principal
of (or premium, if any, on) any Notes as and when the same shall become
due and payable either at maturity, upon prepayment, by declaration of
acceleration of maturity or otherwise; or
(c) default in the performance, or breach, in any material
respect of any covenant or warranty of the Company in this Note
Agreement (other than a covenant or warranty a default in whose
performance or whose breach is elsewhere in this Section specifically
dealt with), and continuance of such default or breach for a period of
90 days after there has been given, by registered or certified mail, to
the Company by the holders of at least 25% in aggregate principal
amount of the outstanding Notes a written notice specifying such
default or breach and requiring it to be remedied and stating that such
notice is a "Notice of Default" hereunder; or
(d) a court having jurisdiction in the premises shall enter a
decree or order for relief in respect of the Company in an involuntary
case under any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect, or appointing a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of the
Company or for any substantial part of its property, or ordering the
winding-up or liquidation of its affairs and such decree or order shall
remain unstayed and in effect for a period of 90 consecutive days; or
(e) the Company shall commence a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter
in effect, shall consent to the entry of an order for relief in an
involuntary case under any such law, or shall consent to the
appointment of or the taking of possession by a receiver, liquidator,
assignee, trustee, custodian, sequestrator (or other similar official)
of the Company or of any substantial part of its property, or shall
make any general assignment for the benefit of creditors, or admission
by it in writing of its inability to pay its debts as they become due.
If an Event of Default with respect to Notes at the time outstanding
occurs and is continuing, then in every such case the holders of not less than
25% in aggregate principal amount of the Notes then outstanding may declare the
principal amount of all Notes to be due and payable immediately, by a notice in
writing to the Company and upon any such declaration the same shall become
immediately due and payable.
The foregoing provisions, however, are subject to the condition that
if, at any time after the principal of the Notes shall have been so declared due
and payable, and before any judgment or decree for the payment of the moneys due
shall have been obtained or entered as hereinafter provided, (i) the Company
shall pay a sum sufficient to pay all matured installments of interest upon all
the Notes and the principal of and premium, if any, on any and all Notes which
shall have become due otherwise than by acceleration (with interest upon such
principal and premium, if any, and, to the extent that payment of such interest
is enforceable under applicable law, on overdue installments of interest, at the
same rate as the rate of interest specified in the Notes to the date of such
payment or deposit), and (ii) any and all Events of Default under the Note,
other than the non-payment of the principal of the Notes which shall have become
due solely by such declaration of acceleration, shall have been cured, waived or
otherwise remedied as provided herein, then, in every such case, the holders of
a majority in aggregate principal amount of the Notes then outstanding, by
written notice to the Company, may rescind and annul such declaration and its
consequences, but no such waiver or rescission and annulment shall extend to or
shall affect any subsequent default or shall impair any right consequent
thereon.
SECTION 5.02. Payment of Notes on Default; Suit Therefor.
The Company covenants that (a) in case default shall be made in the
payment of any installment of interest upon any of the Notes as and when the
same shall become due and payable, and such default shall have continued for a
period of 30 days (provided, however, the valid extension of an interest payment
period in accordance with Section 14.01 hereof shall not constitute a default in
the payment of interest for this purpose), or (b) in case default shall be made
in the payment of the principal of or premium, if any, on any of the Notes as
and when the same shall have become due and payable, whether at maturity of the
Notes or upon prepayment or by declaration or otherwise, then, upon demand of
holders of not less than 25% in aggregate principal amount of the Notes then
outstanding, the Company will pay to the holders of the Notes, the whole amount
that then shall have become due and payable on all such Notes for principal and
premium, if any, or interest, or both, as the case may be, with interest upon
the overdue principal and premium, if any, at the rate borne by the Notes; and,
in addition thereto, such further amount as shall be sufficient to cover the
costs and expenses of collection, including a reasonable compensation to the
holders attorneys and counsel.
In case the Company shall fail forthwith to pay such amounts upon such
demand, the holders shall be entitled and empowered to institute any actions or
proceedings at law or in equity for the collection of the sums so due and
unpaid, and may prosecute any such action or proceeding to judgment or final
decree, and may enforce any such judgment or final decree against the Company or
any other obligor on the Notes and collect in the manner provided by law out of
the property of the Company or any other obligor on the Notes wherever situated
the moneys adjudged or decreed to be payable.
In case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Company or any other obligor on the Notes under Title
11, United States Code, or any other applicable law, or in case a receiver or
trustee shall have been appointed for the property of the Company or such other
obligor, or in the case of any other similar judicial proceedings relative to
the Company or other obligor upon the Notes, or to the creditors or property of
the Company or such other obligor, the holders, irrespective of whether the
principal of the Notes shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the holders of not less
than 25% in aggregate principal amount of the Notes then outstanding shall have
made any demand pursuant to the provisions of this Section 5.02, shall be
entitled and empowered, by intervention in such proceedings or otherwise, to
file and prove a claim or claims for the whole amount of principal and interest
owing and unpaid in respect of the Notes and, in case of any judicial
proceedings, to file such proofs of claim and other papers or documents as may
be necessary or advisable in order to have the claims of the Noteholders and
their respective agents, attorneys and counsel, and for reimbursement of all
expenses and liabilities incurred, and all advances made, by the Noteholders
allowed in such judicial proceedings relative to the Company or any other
obligor on the Notes, or to the creditors or property of the Company or such
other obligor, unless prohibited by applicable law and regulations, to vote on
behalf of the holders of the Notes in any election of a trustee or a standby
trustee in arrangement, reorganization, liquidation or other bankruptcy or
insolvency proceedings or person performing similar functions in comparable
proceedings.
SECTION 5.03. Proceedings by Noteholders.
Except as set forth below, no holder of any Note shall have any right
by virtue of or by availing of any provision of this Note Agreement to institute
any suit, action or proceeding in equity or at law upon or under or with respect
to this Note Agreement or for the appointment of a receiver or trustee, or for
any other remedy hereunder, that no one or more holders of Notes shall have any
right in any manner whatever by virtue of or by availing of any provision of
this Note Agreement to affect, disturb or prejudice the rights of any other
holder of Notes, or to obtain or seek to obtain priority over or preference to
any other such holder, or to enforce any right under this Note Agreement, except
in the manner herein provided and for the equal, ratable and common benefit of
all holders of Notes.
Notwithstanding any other provisions in this Note Agreement, however,
the right of any holder of any Note to receive payment of the principal of
(premium, if any) and interest on such Note, on or after the same shall have
become due and payable, or to institute suit for the enforcement of any such
payment, shall not be impaired or affected without the consent of such holder
and by accepting a Note hereunder it is expressly understood, intended and
covenanted by the taker and holder of every Note with every other such taker and
holder, that no one or more holders of Notes shall have any right in any manner
whatsoever by virtue or by availing of any provision of the Note Agreement or
Note to affect, disturb or prejudice the rights of the holders of any other
Notes, or to obtain or seek to obtain priority over or preference to any other
such holder, or to enforce any right under the Notes or this Note Agreement,
except in the manner herein provided and for the equal, ratable and common
benefit of all holders of Notes. For the protection and enforcement of the
provisions of this Section, each and every Noteholder shall be entitled to such
relief as can be given either at law or in equity.
The Company acknowledges that, with respect to any Notes held by the
Trust or the Administrative Trustees on behalf of the Trust, if the
Administrative Trustees fail to enforce their rights under this Note as the
holders of the Notes held as the assets of the Trust, any holder of Preferred
Securities may, to the extent permitted by applicable law, institute legal
proceedings directly against the Company to enforce such Administrative
Trustees' rights under this Note Agreement and the Notes without first
instituting any legal proceedings against such Administrative Trustees or any
other person or entity. Notwithstanding the foregoing, if an Event of Default
has occurred and is continuing and such event is attributable to the failure of
the Company to pay principal of or premium, if any, or interest on the Notes
when due, the Company acknowledges that a holder of Preferred Securities may
directly institute a proceeding for enforcement of payment to such holder of the
principal of or premium, if any, or interest on the Notes having a principal
amount equal to the aggregate liquidation amount of the Preferred Securities of
such holder on or after the respective due date specified in the Notes (a
"Direct Action").
Notwithstanding any payments made to a holder of Preferred Securities
by the Company pursuant to a Direct Action initiated by such holder, the Company
shall remain obligated to pay the principal of or premium, if any, or interest
due on the Notes, and the Company shall be subrogated to the rights of the
holder of such Preferred Securities with respect to payments on the Preferred
Securities to the extent of any payments made by the Company to such holder in
any Direct Action.
SECTION 5.04. Remedies Cumulative and Continuing.
Except as provided in the last paragraph of Section 2.08, all powers
and remedies given by this Article V to the Noteholders shall, to the extent
permitted by law, be deemed cumulative and not exclusive of any other powers and
remedies available to the holders of the Notes, by judicial proceedings or
otherwise, to enforce the performance or observance of the covenants and
agreements contained in this Note Agreement or otherwise established with
respect to the Notes, and no delay or omission of any holder of any of the Notes
to exercise any right or power accruing upon any Event of Default occurring and
continuing as aforesaid shall impair any such right or power, or shall be
construed to be a waiver of any such default or an acquiescence therein; and,
subject to the provisions of Section 5.04, every power and remedy given by this
Article V or by law to Noteholders may be exercised from time to time, and as
often as shall be deemed expedient, by the Noteholders.
SECTION 5.05. Direction of Proceedings and Waiver of Defaults by Majority of
Noteholders.
The holders of a majority in aggregate principal amount of the Notes at
the time outstanding shall have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Noteholders, or
exercising any trust or power conferred on the Noteholders. Prior to any
declaration accelerating the maturity of the Notes, the holders of a Majority in
aggregate principal amount of the Notes at the time outstanding may on behalf of
the holders of all of the Notes waive any past default or Event of Default and
its consequences except a default (a) in the payment of principal of or premium,
if any, or interest on any of the Notes or (b) in respect of covenants or
provisions hereof which cannot be modified or amended without the consent of the
holder of each Note affected. Upon any such waiver, the default covered thereby
shall be deemed to be cured for all purposes of this Note Agreement and the
Notes and the Company and the holders of the Notes shall be restored to their
former positions and rights hereunder, respectively; but no such waiver shall
extend to any subsequent or other default or impair any right consequent
thereon. Whenever any default or Event of Default hereunder shall have been
waived as permitted by this Section 5.05, said default or Event of Default shall
for all purposes of the Notes and this Note Agreement be deemed to have been
cured and to be not continuing.
SECTION 5.06. Notice of Defaults.
The Company shall, within five Business Days after actual knowledge of
the occurrence of a default with respect to the Notes, mail to all Noteholders,
as the names and addresses of such holders appear upon the Note Register, notice
of all defaults known to the Company unless such defaults shall have been cured
before the giving of such notice (the term "defaults" for the purpose of this
Section 5.06 being hereby defined to be the events specified in clauses (a),
(b), (c), (d) and (e) of Section 5.01, not including periods of grace, if any,
provided for therein, and irrespective of the giving of written notice specified
in clause (c) of Section 5.01); and provided that, except in the case of default
in the payment of the principal of or premium, if any, or interest on any of the
Notes, the Company shall be protected in withholding such notice if and so long
as the board of directors, the executive committee, or another committee of
directors and/or Responsible Officers of the Company in good faith determines
that the withholding of such notice is in the interests of the Noteholders; and
provided further that in the case of any default of the character specified in
Section 5.01(c) no such notice to Noteholders shall be given until at least 60
days after the occurrence thereof but shall be given within 90 days after such
occurrence.
SECTION 5.07. Undertaking to Pay Costs.
All parties to this Note Agreement agree, and each holder of any Note
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Note Agreement, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant; but
the provisions of this Section 5.07 shall not apply to any suit instituted by
any Noteholder, or group of Noteholders, holding in the aggregate more than 10%
in aggregate principal amount of the Notes outstanding, or to any suit
instituted by any Noteholder for the enforcement of the payment of the principal
of (or premium, if any) or interest on any Note against the Company on or after
the same shall have become due and payable.
ARTICLE VI
CONCERNING THE NOTEHOLDERS
SECTION 6.01. Action by Noteholders.
Whenever in this Note Agreement it is provided that the holders of a
specified percentage in aggregate principal amount of the Notes may take any
action (including the making of any demand or request, the giving of any notice,
consent or waiver or the taking of any other action) the fact that at the time
of taking any such action the holders of such specified percentage have joined
therein may be evidenced (a) by any instrument or any number of instruments of
similar tenor executed by such Noteholders in person or by agent or proxy
appointed in writing, or (b) by the record of such holders of Notes voting in
favor thereof at any meeting of such Noteholders duly called and held in
accordance with the provisions of Article VII, or (c) by a combination of such
instrument or instruments and any such record of such a meeting of such
Noteholders.
If the Company shall solicit from the Noteholders any request, demand,
authorization, direction, notice, consent, waiver or other action, the Company
may, at its option, as evidenced by an Officers' Certificate, fix in advance a
record date for the determination of Noteholders entitled to give such request,
demand, authorization, direction, notice, consent, waiver or other action or to
revoke any such action, but the Company shall have no obligation to do so. If
such a record date is fixed, such request, demand, authorization, direction,
notice, consent, waiver or other action or revocation may be given before or
after the record date, but only the Noteholders of record at the close of
business on the record date shall be deemed to be Noteholders for the purposes
of determining whether Noteholders of the requisite proportion of outstanding
Notes have authorized or agreed or consented to such request, demand,
authorization, direction, notice, consent, waiver or other action, and for that
purpose the outstanding Notes shall be computed as of the record date; provided,
however, that no such authorization, agreement or consent by such Noteholders on
the record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Note Agreement not later than six months
after the record date.
SECTION 6.02. Notes Owned by Company Deemed Not Outstanding.
In determining whether the holders of the requisite aggregate principal
amount of Notes have concurred in any direction, consent or waiver under this
Note Agreement, Notes which are owned by the Company or any other obligor on the
Notes or by any person directly or indirectly controlled by the Company or any
other obligor on the Notes shall be disregarded and deemed not to be outstanding
for the purpose of any such determination. Securities so owned which have been
pledged in good faith may be regarded as outstanding for the purposes of this
Section 6.02 if the pledgee shall establish the pledgee's right to vote such
Notes and that the pledgee is not the Company or any such other obligor or
person directly or indirectly controlled by the Company or any such other
obligor.
SECTION 6.03. Revocation of Consents; Future Holders Bound.
At any time prior to (but not after) the evidencing, as provided in
Section 6.01, of the taking of any action by the holders of the percentage in
aggregate principal amount of the Notes specified in this Note Agreement in
connection with such action, any holder of a Note (or any Note issued in whole
or in part in exchange or substitution therefor), subject to Section 6.01, the
serial number of which is shown by the evidence to be included in the Notes the
holders of which have consented to such action may, by filing written notice and
upon proof of holding as provided in Section 6.02, revoke such action so far as
concerns such Note (or so far as concerns the principal amount represented by
any exchanged or substituted Note). Except as aforesaid, any such action taken
by the holder of any Note shall be conclusive and binding upon such holder and
upon all future holders and owners of such Note, and of any Note issued in
exchange or substitution therefor, irrespective of whether or not any notation
in regard thereto is made upon such Note or any Note issued in exchange or
substitution therefor.
ARTICLE VII
NOTEHOLDERS' MEETINGS
SECTION 7.01. Purposes of Meetings.
A meeting of Noteholders may be called at any time and from time to
time pursuant to the provisions of this Article VII for any of the following
purposes:
(a) to give any notice to the Company, or to give any directions to the
Company, or to consent to the waiving of any default hereunder and its
consequences, or to take any other action authorized to be taken by
Noteholders pursuant to any of the provisions of Article V;
(b) to consent to the execution of any Note or Notes supplemental
hereto pursuant to the provisions of Section 8.02; or
(c) to take any other action authorized to be taken by or on behalf of
the holders of any specified aggregate principal amount of such Notes
under any other provision of this Note Agreement or under applicable
law.
SECTION 7.02. Call of Meetings by Company or Noteholders.
The Company, pursuant to a resolution of the Board of Directors, may
call a meeting of the Noteholders. The holders of at least 10% in aggregate
principal amount of the Notes then outstanding may request a meeting of the
Noteholders, and if they shall have requested a meeting of Noteholders, by
written request setting forth in reasonable detail the action proposed to be
taken at the meeting, and the Company shall not have mailed the notice of such
meeting within 20 days after receipt of such request, then the such Noteholders
may determine the time and the place for such meeting and may call such meeting
to take any action authorized in Section 7.01, by mailing notice thereof as
provided in Section 7.02.
SECTION 7.03. Qualifications for Voting.
To be entitled to vote at any meeting of Noteholders a person shall be
(a) a holder of one or more Notes or (b) a Person appointed by an instrument in
writing as proxy by a holder of one or more Notes. The only Persons who shall be
entitled to be present or to speak at any meeting of Noteholders shall be the
Persons entitled to vote at such meeting and their counsel and any
representatives of the Company and its counsel.
SECTION 7.04. Regulations.
Notwithstanding any other provisions of this Note Agreement, the
Company may make such reasonable regulations as it may deem advisable for any
meeting of Noteholders, in regard to proof of the holding of Notes and of the
appointment of proxies, and in regard to the appointment and duties of
inspectors of votes, the submission and examination of proxies, certificates and
other evidence of the right to vote, and such other matters concerning the
conduct of the meeting as it shall think fit.
The Company or the Noteholders calling the meeting, as the case may be,
shall appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by majority vote of the meeting.
Subject to the provisions of Section 7.03, at any meeting each holder
of Notes or proxy therefor shall be entitled to one vote for each $1,000
principal amount of Notes held or represented by him; provided, however, that no
vote shall be cast or counted at any meeting in respect of any Note challenged
as not outstanding and ruled by the chairman of the meeting to be not
outstanding. The chairman of the meeting shall have no right to vote other than
by virtue of Notes held by him or instruments in writing as aforesaid duly
designating him as the person to vote on behalf of other Noteholders. Any
meeting of Noteholders duly called pursuant to the provisions of Section 7.02
may be adjourned from time to time by a majority of those present, whether or
not constituting a quorum, and the meeting may be held as so adjourned without
further notice.
The Persons entitled to vote a majority in principal amount of the
outstanding Notes shall constitute a quorum for a meeting of Holders of Notes;
provided, however, that if any action is to be taken at such meeting with
respect to a consent, waiver, request, demand, notice, authorization, direction
or other action which may be given by the holders of not less than a specified
percentage in principal amount of the outstanding Notes, the Persons holding or
representing such specified percentage in principal amount of the outstanding
Notes will constitute a quorum. In the absence of a quorum within 30 minutes of
the time appointed for any such meeting, the meeting shall, if convened at the
request of holders of Notes, be dissolved. In any other case the meeting may be
adjourned for a period of not less than 10 days as determined by the chairman of
the meeting prior to the adjournment of such meeting. In the absence of a quorum
at any such adjourned meeting, such adjourned meeting may be further adjourned
for a period of not less than 10 days as determined by the chairman of the
meeting prior to the adjournment of such adjourned meeting. Notice of the
reconvening of any adjourned meeting shall be given as provided in Section 7.02,
except that such notice need be given only once not less than five days prior to
the date on which the meeting is scheduled to be reconvened. Notice of the
reconvening of an adjourned meeting shall state expressly the percentage, as
provided above, of the principal amount of the outstanding Notes which shall
constitute a quorum.
Except as limited by the first proviso to the first paragraph of
Section 8.02, any resolution presented to a meeting or adjourned meeting duly
reconvened at which a quorum is present as aforesaid may be adopted by the
affirmative vote of the holders of a majority in principal amount of the
outstanding Notes; provided, however, that, except as limited by the first
proviso to the first paragraph of Section 8.02, any resolution with respect to
any consent, waiver, request, demand, notice, authorization, direction or other
action which this Note Agreement expressly provides may be given by the holders
of not less than a specified percentage in principal amount of the outstanding
Notes may be adopted at a meeting or an adjourned meeting duly reconvened and at
which a quorum is present as aforesaid only by the affirmative vote of the
holders of not less than such specified percentage in principal amount of the
outstanding Notes.
Any resolution passed or decision taken at any meeting of holders of
Notes duly held in accordance with this Section shall be binding on all the
holders of Notes whether or not present or represented at the meeting.
SECTION 7.05. Voting.
The vote upon any resolution submitted to any meeting of holders of
Notes shall be by written ballots on which shall be subscribed the signatures of
such holders or of their representatives by proxy and the serial number or
numbers of the Notes held or represented by them. The permanent chairman of the
meeting shall appoint two inspectors of votes who shall count all votes cast at
the meeting for or against any resolution and who shall make and file with the
secretary of the meeting their verified written reports in triplicate of all
votes cast at the meeting. A record in duplicate of the proceedings of each
meeting of Noteholders shall be prepared by the secretary of the meeting and
there shall be attached to said record the original reports of the inspectors of
votes on any vote by ballot taken thereat and affidavits by one or more persons
having knowledge of the facts setting forth a copy of the notice of the meeting
and showing that said notice was mailed as provided in Section 7.02. The record
shall show the serial numbers of the Notes voting in favor of or against any
resolution. The record shall be signed and verified by the affidavits of the
permanent chairman and secretary of the meeting and one of the duplicates shall
be delivered to the Company.
Any record so signed and verified shall be conclusive evidence of the
matters therein stated.
ARTICLE VIII
AMENDMENTS
SECTION 8.01. Without Consent of Noteholders.
The Company may from time to time and at any time amend the Note
Agreement or the Notes, without the consent of the Noteholders, for one or more
of the following purposes:
(a) to evidence the succession of another corporation to the Company,
or successive successions, and the assumption by the successor
corporation of the covenants, agreements and obligations of the Company
pursuant to Article IX hereof;
(b) to surrender any right or power herein conferred upon the Company;
(c) to add to the covenants of the Company such further covenants,
restrictions or conditions for the protection of the Noteholders as the
Company shall consider to be for the protection of the Noteholders, and
to make the occurrence, or the occurrence and continuance, of a default
in any of such additional covenants, restrictions or conditions a
default or an Event of Default permitting the enforcement of all or any
of the remedies provided in this Note Agreement as herein set forth;
provided, however, that in respect of any such additional covenant,
restriction or condition such amendment may provide for a particular
period of grace after default (which period may be shorter or longer
than that allowed in the case of other defaults) or may provide for an
immediate enforcement upon such default;
(d) to cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental Note Agreement which may be
defective or inconsistent with any other provision contained herein or
in any supplemental Note Agreement, or to make such other provisions in
regard to matters or questions arising under this Note Agreement;
provided that any such action shall not materially adversely affect the
interests of the holders of the Notes;
(e) to make provision for transfer procedures, certification,
book-entry provisions, the form of restricted securities legends, if
any, to be placed on Notes, minimum denominations and all other matters
required pursuant to Section 2.07 or otherwise necessary, desirable or
appropriate in connection with the issuance of Notes to holders of
Preferred Securities in the event of a distribution of Notes by the
Trust following a Dissolution Event; and
(f) to make any change that does not adversely affect the rights of any
Noteholder in any material respect. Any amendment to the Note Agreement
authorized by the provisions of this Section 8.01 may be executed by
the Company without the consent of the holders of any of the Notes at
the time outstanding, notwithstanding any of the provisions of Section
8.02 A copy of each amendment shall be provided to the holders of the
Notes by the Company. .
SECTION 8.02. With Consent of Noteholders.
With the consent of the holders of a Majority in aggregate principal
amount of the Notes at the time outstanding, the Company, when authorized by a
board resolution (which resolution may provide general terms or parameters for
such action and may provide that the specific terms of such action may be
determined in accordance with or pursuant to the resolution), may from time to
time and at any time amend the Note Agreement for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Note Agreement or of modifying in any manner the rights of the holders of
the Notes; provided, however, that no such amendment shall without the consent
of the holders of each Note then outstanding and affected thereby (i) extend the
Maturity Date of any Note, or reduce the rate or extend the time of payment of
interest thereon (except as contemplated by Article XIV), or reduce the
principal amount thereof, or reduce any amount payable on prepayment thereof, or
make the principal thereof or any interest or premium thereon payable in any
coin or currency other than that provided in the Notes, or impair or affect the
right of any Noteholder to institute suit for payment thereof, or (ii) reduce
the aforesaid percentage of Notes the holders of which are required to consent
to any such amendment to the Note Agreement, provided, however, that if the
Notes are held by the Trust, such amendment shall not be effective until the
holders of a majority in liquidation amount of Trust Securities shall have
consented to such amendment; provided further that if the consent of the holder
of each outstanding Note is required, such amendment shall not be effective
until each holder of the Trust Securities shall have consented to such
amendment; and provided further that such amendment shall not impair or affect
the right of any holder of Preferred Securities to commence a Direct Action, in
the circumstances and subject to the limitations set forth in the Declaration,
until each holder of Preferred Securities shall have consented to such
amendment.
Promptly after the execution by the Company of any supplemental Note
Agreement or amendment pursuant to the provisions of this Section, the Company
shall transmit by mail, first class postage prepaid, a notice, prepared by the
Company, setting forth in general terms the substance of such supplemental Note
Agreement, to the Noteholders as their names and addresses appear upon the Note
Register. Any failure of the Company to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of any such
supplemental Note Agreement or amendment.
It shall not be necessary for the consent of the Noteholders under this
Section 8.02 to approve the particular form of any proposed supplemental Note
Agreement, but it shall be sufficient if such consent shall approve the
substance thereof.
SECTION 8.03. Notation on Notes.
Notes delivered after the execution of any supplemental Note Agreement
or amendment affecting such Notes pursuant to the provisions of this Article
VIII may bear a notation in form approved by the Company as to any matter
provided for in such supplemental Note Agreement. If the Company shall so
determine, new Notes so modified as to conform, in the opinion of the Company,
to any modification of this Note Agreement contained in any such supplemental
Note Agreement may be prepared and executed by the Company, and delivered in
exchange for the Notes then outstanding.
ARTICLE IX
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
SECTION 9.01. Company May Consolidate, etc., Only on Certain Terms.
The Company shall not consolidate with or merge with or into any other
Person or sell, convey, assign, transfer, lease or otherwise dispose of all or
substantially all of its properties and assets as an entirety to any Person,
unless:
(1) the Person formed by such consolidation or into which the Company
is merged or the Person which acquires, by sale, assignment,
conveyance, transfer, lease or disposition of all or substantially all
of the properties and assets of the Company as an entirety (A) shall be
a corporation, limited liability company, partnership or trust
organized and validly existing under the laws of the United States of
America, any State thereof or the District of Columbia and (B) shall
expressly assume, by a Note Agreement supplemental hereto, executed and
delivered to the Noteholders, the Company's obligation for the due and
punctual payment of the principal of (and premium, if any, on) and
interest on all the Notes and the performance and observance of every
covenant of this Note Agreement on the part of the Company to be
performed or observed;
(2) immediately before and immediately after giving pro forma effect to
such transaction (and treating any indebtedness not previously an
obligation of the Company or a Subsidiary which became the obligation
of the Company or any of its Subsidiaries in connection with or as a
result of such transaction as having been incurred at the time of such
transaction), no default or Event of Default shall have occurred and be
continuing; and
(3) the Company or such Person shall have delivered to the Noteholders
an Officers' Certificate and an Opinion of Counsel, each stating that
such consolidation, merger, conveyance, transfer or lease and such
supplemental Note Agreement comply with this Article and that all
conditions precedent herein provided for relating to such transaction
have been complied with.
This Section and Section 9.02 shall only apply to a merger or
consolidation in which the Company is not the surviving corporation and to
conveyances, leases and transfers by the Company as transferor or lessor of all
or substantially all of the properties and assets of the Company and its
Subsidiaries on a consolidated basis to any Person.
SECTION 9.02. Successor Person Substituted.
Upon any consolidation by the Company with or merger by the Company
into any other corporation or any sale, assignment, conveyance, transfer,
disposition or lease of all or substantially all of the properties and assets of
the Company as an entirety to any Person in accordance with Section 9.01, the
successor Person formed by such consolidation or into which the Company is
merged or to which such conveyance, transfer or lease is made shall succeed to,
and be substituted for, and may exercise every right and power of, the Company
under this Note Agreement with the same effect as if such successor Person had
been named as the Company herein, and in the event of any such conveyance or
transfer, the Company (which term shall for this purpose mean the Person named
as the "Company" in the first paragraph of this Note Agreement or any successor
Person which shall theretofore become such in the manner described in Section
9.01), except in the case of a lease, shall be discharged of all obligations and
covenants under this Note and the Securities and the coupons and may be
dissolved and liquidated.
ARTICLE X
SATISFACTION AND DISCHARGE OF NOTE AGREEMENT
SECTION 10.01. Discharge of Note Agreement.
When (a) the Company shall have canceled all Notes (other than any
Securities which shall have been destroyed, lost or stolen and which shall have
been replaced or paid as provided in Section 2.08) and not theretofore canceled,
or (b) all the Notes not theretofore canceled shall have become due and payable,
or are by their terms to become due and payable within one year or are to be
called for prepayment within one year, and the Company shall deposit with a
financial institution, in escrow, funds sufficient to pay on the Maturity Date
or upon prepayment all of the Notes (other than any Notes which shall have been
destroyed, lost or stolen and which shall have been replaced as provided in
Section 2.08) not theretofore canceled, including principal and premium, if any,
and interest due or to become due to the Maturity Date or prepayment date, as
the case may be, but excluding, however, the amount of any moneys for the
payment of principal of or premium, if any, or interest on the Notes (1)
theretofore repaid to the Company in accordance with the provisions of Section
10.04, or (2) paid to any State or to the District of Columbia pursuant to its
unclaimed property or similar laws, and if in either case the Company shall also
pay or cause to be paid all other sums payable hereunder by the Company, then
this Note Agreement shall cease to be of further effect except for the
provisions of Sections 2.07, 2.08, 3.01 and 10.04 hereof, which shall survive
until such Notes shall mature and be paid. Thereafter, Section 10.04 shall
survive, and the Company shall execute proper instruments acknowledging
satisfaction of and discharging this Note Agreement.
SECTION 10.02. Deposited Moneys and U.S. Government Obligations to Be Held in
Trust by Trustee.
Subject to the provisions of Section 10.04, all moneys and U.S.
Government Obligations deposited in an escrow account pursuant to Sections 10.01
or 10.05 shall be held in escrow and applied to the payment, either directly or
through any paying agent (including the Company if acting as its own paying
agent), to the holders of the particular Notes for the payment of which such
moneys or U.S. Government Obligations have been deposited in escrow, of all sums
due and to become due thereon for principal, premium, if any, and interest.
SECTION 10.03. Paying Agent to Repay Moneys Held.
Upon the satisfaction and discharge of this Note Agreement all moneys
then held by any paying agent of the Notes shall, upon written demand of the
Company, be repaid to it or paid to the escrow account referred to in Section
10.03 and thereupon such paying agent shall be released from all further
liability with respect to such moneys.
SECTION 10.04. Return of Unclaimed Moneys.
Any moneys deposited with or paid to the escrow account or any paying
agent for payment of the principal of or premium, if any, or interest on Notes
and not applied but remaining unclaimed by the holders of Notes for two years
after the date upon which the principal of or premium, if any, or interest on
such Notes, as the case may be, shall have become due and payable, shall be
repaid to the Company by the escrow agent or such paying agent on Company
Request; and the holder of any of the Notes shall thereafter look only to the
Company for any payment which such holder may be entitled to collect and all
liability of the escrow agent or such paying agent with respect to such moneys
shall thereupon cease.
SECTION 10.05. Defeasance Upon Deposit of Moneys or U.S. Government Obligations.
The Company shall be deemed to have been Discharged (as defined below)
from its obligations with respect to the Notes on the 91st day after the
conditions set forth below have been satisfied:
(1) `The Company shall have deposited or caused to be deposited
irrevocably with the Defeasance Agent (as defined below) as trust funds
in trust, specifically pledged as security for, and dedicated solely
to, the benefit of the holders of the Notes (i) money in an amount, or
(ii) U.S. Government Obligations which through the payment of interest
and principal in respect thereof in accordance with their terms will
provide, not later than one day before the due date of any payment,
money in an amount, or (iii) a combination of (i) and (ii), sufficient,
in the opinion (with respect to (ii) and (iii)) of a nationally
recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Defeasance Agent, to pay
and discharge each installment of principal of and interest and
premium, if any, on the outstanding Notes on the dates such
installments of principal, interest or premium are due;
(2) no Default or Event of Default with respect to the Notes shall have
occurred and be continuing on the date of such deposit; and
(3) the Company shall have delivered to the Defeasance Agent an Opinion
of Counsel to the effect that holders of the Notes will not recognize
income, gain or loss for United States federal income tax purposes as a
result of the exercise of the option under this Section 10.05 and will
be subject to United States federal income tax on the same amount and
in the same manner and at the same times as would have been the case if
such option had not been exercised, and such opinion shall be based on
a statute so providing or be accompanied by a private letter ruling to
that effect received from the United States Internal Revenue Service or
a revenue ruling pertaining to a comparable form of transaction to that
effect published by the United States Internal Revenue Service.
"Discharged" means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by, and obligations under, the
Notes and to have satisfied all the obligations under this Note Agreement
relating to the Notes except (A) the rights of holders of Notes to receive, from
the fund described in clause (1) above, payment of the principal of and the
interest and premium, if any, on the Notes when such payments are due; and (B)
the Company's obligations with respect to the Securities under Sections 2.07,
2.08, and 10.04.
"Defeasance Agent" means a financial institution which is eligible to
act as a trustee under the Trust Indenture Act of 1939, as amended and which
assumes all of the obligations necessary to enable the Trustee to act under this
Article. In the event such a Defeasance Agent is appointed pursuant to this
Section, the Defeasance Agent shall provide verification to the Noteholders
acknowledging receipt of sufficient money and/or U. S. Government Obligations to
meet the applicable conditions set forth in this Section 10.05.
ARTICLE XI
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
SECTION 11.01. Note Agreement and Notes Solely Corporate Obligations.
No recourse for the payment of the principal of or premium, if any, or
interest on any Note, or for any claim based thereon or otherwise in respect
thereof, and no recourse under or upon any obligation, covenant or agreement of
the Company in this Note Agreement, or in any Note, or because of the creation
of any indebtedness represented thereby, shall be had against any incorporator,
stockholder, officer or director, as such, past, present or future, of the
Company or of any successor Person to the Company, either directly or through
the Company or any successor Person to the Company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly understood that all such liability is
hereby expressly waived and released as a condition of, and as a consideration
for, the execution of this Note Agreement and the issue of the Notes.
ARTICLE XII
MISCELLANEOUS PROVISIONS
SECTION 12.01. Successors.
All the covenants, stipulations, promises and agreements in this Note
Agreement contained by the Company shall bind its successors and assigns whether
so expressed or not.
SECTION 12.02. Official Acts by Successor Corporation.
Any act or proceeding by any provision of this Note Agreement
authorized or required to be done or performed by any board, committee or
officer of the Company shall and may be done and performed with like force and
effect by the like board, committee or officer of any corporation that shall at
the time be the lawful sole successor of the Company
SECTION 12.03. Surrender of Company Powers.
The Company by instrument in writing executed by authority of its Board
of Directors may surrender any of the powers reserved to the Company, and
thereupon such power so surrendered shall terminate both as to the Company, as
the case may be, and as to any successor Person.
SECTION 12.04. Addresses for Notices, etc.
Any notice or demand which by any provision of this Note Agreement is
required or permitted to be given or served by the holders of Notes on the
Company may be given or served by being deposited postage prepaid by registered
or certified mail in a post office letter box addressed (until another address
is mailed by the Company to the Noteholders for the purpose) to FBL Financial
Group, Inc., 5400 University Avenue, West Des Moines, Iowa 50266; Attention:
Secretary
Any notice or communication to a Noteholder shall be mailed by first
class mail to his or her address shown on the Note Register. Failure to mail a
notice or communication to a Noteholder or any defect in it shall not affect its
sufficiency with respect to other Noteholders.
SECTION 12.05. Governing Law.
This Note Agreement and each Note shall be deemed to be a contract made
under the laws of the State of Iowa, and for all purposes shall be governed by
and construed in accordance with the laws of said State, without regard to
conflicts of laws principles thereof.
SECTION 12.06. Evidence of Compliance with Conditions Precedent.
Upon any application or demand by the Company to the Noteholders to
take any action under any of the provisions of this Note Agreement, the Company
shall furnish to the Noteholders an Officers' Certificate stating that in the
opinion of the signers all conditions precedent, if any, provided for in this
Note Agreement relating to the proposed action have been complied with and an
Opinion of Counsel stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.
Each certificate or opinion provided for in this Note Agreement and
delivered to the Noteholders with respect to compliance with a condition or
covenant provided for in this Note Agreement shall include (1) a statement that
the person making such certificate or opinion has read such covenant or
condition; (2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based; (3) a statement that, in the opinion of such
person, he has made such examination or investigation as is necessary to enable
him to express an in formed opinion as to whether or not such covenant or
condition has been complied with; and (4) a statement as to whether or not, in
the opinion of such person, such condition or covenant has been complied with.
SECTION 12.07. Business Days.
In any case where the date of payment of principal of or premium, if
any, or interest on the Notes will not be a Business Day, the payment of such
principal of or premium, if any, or interest on the Notes need not be made on
such date but may be made on the next succeeding day which is a Business Day
(and without any interest or other payment in respect of any such delay), in
each case, with the same force and effect as if made on the date such payment
was originally payable.
SECTION 12.08. Table of Contents, Headings, etc.
The table of contents and the titles and headings of the articles and
sections of this Note Agreement have been inserted for convenience of reference
only, are not to be considered a part hereof, and shall in no way modify or
restrict any of the terms or provisions hereof.
SECTION 12.09. Execution in Counterparts.
This Note Agreement may be executed in any number of counterparts, each
of which shall be an original, but such counterparts shall together constitute
but one and the same instrument.
SECTION 12.10. Separability.
In case any one or more of the provisions contained in this Note
Agreement or in the Notes shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Note Agreement or of the Notes,
but this Note Agreement and the Notes shall be construed as if such invalid or
illegal or unenforceable provision had never been contained herein or therein.
SECTION 12.11. Assignment.
The Company will have the right at all times to assign any of its
respective rights or obligations under this Note Agreement to a direct or
indirect wholly owned Subsidiary of the Company, provided that, in the event of
any such assignment, the Company will remain primarily liable for all its
obligations. Subject to the foregoing, the Note Agreement is binding upon and
inures to the benefit of the parties thereto and their respective successors and
assigns. This Note Agreement may not otherwise be assigned by the parties
thereto.
ARTICLE XIII
SUBORDINATION OF NOTES
SECTION 13.01. Agreement to Subordinate.
The Company covenants and agrees, and each holder of Notes issued
hereunder likewise covenants and agrees, that the Notes shall be issued subject
to the provisions of this Article XIII; and each holder of a Note, whether upon
original issue or upon transfer or assignment thereof, accepts and agrees to be
bound by such provisions.
The payment by the Company of the principal of, premium, if any, and
interest on all Notes issued hereunder shall, to the extent and in the manner
hereinafter set forth, be subordinated and junior in right of payment to the
prior payment in full of all Senior Indebtedness, whether outstanding at the
date of this Note Agreement or thereafter incurred.
No provision of this Article XIII shall prevent the occurrence of any
Default or Event of Default hereunder.
SECTION 13.02. Default on Senior Indebtedness.
Unless Section 13.03 shall be applicable, in the event and during the
continuation of any default by the Company in the payment of principal, premium,
interest or any other payment due on any Senior Indebtedness, or in the event
that the maturity of any Senior Indebtedness has been or would be permitted upon
notice or the passage of time to be accelerated because of a default, or if any
judicial proceeding shall be pending with respect to any such default, then,
unless and until such event of default shall have been cured or waived or shall
have ceased to exist and such acceleration shall have been rescinded or
annulled, no payment or distribution of any kind or character, whether in cash,
properties or securities shall be made by the Company with respect to the
principal (including prepayment payments) of or premium, if any, or interest on
the Notes or on account of the purchase or other acquisition of Notes by the
Company or any Subsidiary, in each case unless and until all amounts due or to
become due on such Senior Indebtedness are paid in full in cash or other
consideration satisfactory to the holders of such Senior Indebtedness.
In the event that, notwithstanding the foregoing, any payment shall be
received by the holder of any Note when such payment is prohibited by the
preceding paragraph of this Section 13.02, such payment shall be held in trust
for the benefit of, and shall be paid over or delivered to, the holders of
Senior Indebtedness or their respective representatives, or to the trustee or
trustees under any indenture pursuant to which any of such Senior Indebtedness
may have been issued, as their respective interests may appear, but only to the
extent that the holders of the Senior Indebtedness (or their representative or
representatives or a trustee) notify the Noteholders in writing, within 90 days
of such payment.
SECTION 13.03. Prior Payment to Senior Indebtedness Upon Acceleration of Notes.
In the event that any Notes are declared due and payable before their
Stated Maturity, then no payment or distribution of any kind or character,
whether in cash, properties or securities shall be made by the Company on
account of the principal (including prepayment payments) of, or premium, if any,
or interest on the Notes or on account of the purchase or other acquisition of
Notes by the Company or any Subsidiary, until all amounts due on or in respect
of Senior Indebtedness outstanding at the time of such acceleration shall have
been paid in full to the holders of such Senior Indebtedness in cash or other
consideration satisfactory to the holders of such Senior Indebtedness, or
provision shall have been made for such payment.
In the event that, notwithstanding the foregoing, any payment shall be
received by the Holder of any Note when such payment is prohibited by the
foregoing provisions of this Section 13.03, such payment shall be held in trust
for the benefit of, and shall be paid over or delivered to, the holders of
Senior Indebtedness or their respective representatives, or to the trustee or
trustees under any indenture pursuant to which any of such Senior Indebtedness
may have been issued, as their respective interests may appear, but only to the
extent that the holders of the Senior Indebtedness (or their representative or
representatives or a trustee) notify the Holder of the Note in writing, within
90 days of such payment.
The provisions of this Section shall not apply to any payment with
respect to which Section 13.04 would be applicable.
SECTION 13.04. Liquidation; Dissolution; Bankruptcy.
In the case of the pendency of any receivership, insolvency,
dissolution, winding-up, liquidation, reorganization, assignment for the benefit
of creditors or any other marshaling of assets or liabilities of the Company or
other similar judicial proceeding relative to the Company, whether voluntary or
involuntary or in bankruptcy, insolvency, receivership or other proceedings
(each such event, if any, herein sometimes referred to as a "Proceeding"), then
the holders of Senior Indebtedness shall be entitled to receive payment in full
of all amounts due or to become due on such Senior Indebtedness, or provision
shall be made for such payment in cash or cash equivalents or otherwise in a
manner satisfactory to the holders of Senior Indebtedness, before the holders of
the Notes are entitled to receive or retain any payment or distribution of any
kind or character, whether in cash, property or securities (including any
payment or distribution which may be payable or deliverable by reason of the
payment of any other debt of the Company (including any series of the Notes)
subordinated to the payment of the Notes, such payment or distribution being
hereinafter referred to as a "Junior Subordinated Payment"), on account of
principal of (or premium, if any) or interest on the Notes or on account of the
purchase or other acquisition of Notes by the Company or any Subsidiary, and to
that end the holders of Senior Indebtedness shall be entitled to receive, for
application to the payment thereof, any payment or distribution of any kind or
character, whether in cash, property or securities, including any Junior
Subordinated Payment, which may be payable or deliverable in respect of the
Notes in any such Proceeding.
In the event that, notwithstanding the foregoing provisions of this
Section, the holders of any Notes shall have received any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, including any Junior Subordinated Payment, before all
amounts due or to become due on all Senior Indebtedness are paid in full or
payment thereof is provided for in cash or cash equivalents or otherwise in a
manner satisfactory to the holders of Senior Indebtedness, and if such fact
shall, at or prior to the time of such payment or distribution, have been made
actually known to such holder, then in such event such payment or distribution
shall be paid over or delivered forthwith to the trustee in bankruptcy,
receiver, liquidating trustee, custodian, assignee, agent or other Person making
payment or distribution of assets of the Company for application to the payment
of all amounts due or to become due on all Senior Indebtedness remaining unpaid,
to the extent necessary to pay all amounts due or to become due on all Senior
Indebtedness in full, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Indebtedness.
For purposes of this Article XIII, the words "cash, property or
securities" shall not be deemed (so long as the effect of any exclusion
employing this definition is not to cause the Notes to be treated in any
Proceeding as a part of the same class of claims as the Senior Indebtedness or
any class of claims pari passu with, or senior to the Senior Indebtedness) to
include shares of stock of the Company as reorganized or readjusted, or
securities of the Company or any other corporation provided for by a plan of
reorganization or readjustment, the payment of which is subordinated at least to
the extent provided in this Article XIII with respect to the Notes to the
payment of Senior Indebtedness that may at the time be outstanding, provided
that (i) such Senior Indebtedness is assumed by the new corporation, if any,
resulting from any such reorganization or readjustment, and (ii) the rights of
the holders of such Senior Indebtedness are not, without the consent of such
holders, altered by such reorganization or readjustment. The consolidation of
the Company with, or the merger of the Company into, another Person or the
liquidation or dissolution of the Company following the sale, conveyance,
transfer or lease of its property as an entirety, or substantially as an
entirety, to another Person upon the terms and conditions provided for in
Article IX of this Note Agreement shall not be deemed a dissolution, winding-up,
liquidation or reorganization for the purposes of this Section 13.04 if such
other Person shall, as a part of such consolidation, merger, sale, conveyance,
transfer or lease, comply with the conditions stated in Article IX of this Note
Agreement.
SECTION 13.05. Subrogation.
Subject to the payment in full of all amounts due or to become due on
all Senior Indebtedness to the extent provided herein or the provision for such
payment in cash or cash equivalents or otherwise in a manner satisfactory to the
holders of Senior Indebtedness, the rights of the Noteholders shall be
subrogated to the rights of the holders of such Senior Indebtedness to receive
payments or distributions made to the holders of such Senior Indebtedness
pursuant to the provisions of this Article (equally and ratably with the holders
of all indebtedness of the Company which by its express terms is subordinated to
Senior Indebtedness of the Company to substantially the same extent as the
Securities are subordinated to the Senior Indebtedness and is entitled to like
rights of subrogation by reason of payments or distributions made to holders of
such Senior Indebtedness) to the rights of the holders of such Senior
Indebtedness to receive payments and distributions of cash, property or
securities of the Company, as the case may be, applicable to such Senior
Indebtedness until the principal of (and premium, if any) and interest on the
Notes shall be paid in full; and, for the purposes of such subrogation, no
payments or distributions to the holders of such Senior Indebtedness of any
cash, property or securities to which the Noteholders would be entitled except
for the provisions of this Article XIII, and no payment over pursuant to the
provisions of this Article XIII to or for the benefit of the holders of such
Senior Indebtedness by Noteholders shall, as between the Company, its creditors
other than holders of Senior Indebtedness of the Company, and the holders of the
Notes, be deemed to be a payment by the Company to or on account of such Senior
Indebtedness. It is understood that the provisions of this Article XIII are and
are intended solely for the purposes of defining the relative rights of the
holders of the Notes, on the one hand, and the holders of such Senior
Indebtedness on the other hand.
Nothing contained in this Article XIII or elsewhere in this Note
Agreement or in the Notes is intended to or shall impair, as between the
Company, its creditors other than the holders of Senior Indebtedness of the
Company, and the holders of the Notes, the obligation of the Company, which is
absolute and unconditional, to pay to the holders of the Notes the principal of
(and premium, if any) and interest on the Notes as and when the same shall
become due and payable in accordance with their terms, or is intended to or
shall affect the relative rights of the holders of the Notes and creditors of
the Company, as the case may be, other than the holders of Senior Indebtedness
of the Company, as the case may be, nor shall anything herein or therein prevent
the holder of any Note from exercising all remedies otherwise permitted by
applicable law upon default under the Note Agreement, subject to the rights, if
any, under this Article XIII of the holders of such Senior Indebtedness in
respect of cash, property or securities of the Company, as the case may be,
received upon the exercise of any such remedy.
SECTION 13.06. Company to Effectuate Subordination.
Each Noteholder by such Noteholder's acceptance thereof authorizes and
directs the Company on such Noteholder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article XIII and appoints the Company such Noteholder's attorney-in-fact for any
and all such purposes.
SECTION 13.07. Notice by the Company.
The Company shall give prompt written notice to the Noteholders of any
fact known to the Company that would prohibit the payment of any moneys payable
to the Noteholders but for the application of this Article XIII.
Upon any payment or distribution of assets of the Company referred to
in this Article XIII the Noteholders shall be entitled to rely upon any order or
decree entered by any court of competent jurisdiction in which such insolvency,
bankruptcy, receivership, liquidation, reorganization, dissolution, winding up
or similar case or proceeding is pending, or a certificate of the trustee in
bankruptcy, liquidating trustee, custodian, receiver, assignee for the benefit
of creditors, agent or other person making such payment or distribution,
delivered to the Noteholders, for the purpose of ascertaining the persons
entitled to participate in such payment or distribution, the holders of Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article XIII.
SECTION 13.08. Subordination May Not Be Impaired.
No right of any present or future holder of any Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms, provisions and covenants of this
Note Agreement, regardless of any knowledge thereof that any such holder may
have or otherwise be charged with. Without in any way limiting the generality of
the foregoing paragraph, the holders of Senior Indebtedness may, at any time and
from time to time, without the consent of or notice to the Noteholders, without
incurring responsibility to the Noteholders and without impairing or releasing
the subordination provided in this Article XIII or the obligations hereunder of
the holders of the Notes to the holders of Senior Indebtedness, do any one or
more of the following: (i) change the manner, place or terms of payment or
extend the time of payment of, or renew or alter, such Senior Indebtedness, or
otherwise amend or supplement in any manner such Senior Indebtedness or any
instrument evidencing the same or any agreement under which such Senior
Indebtedness is outstanding; (ii) sell, exchange, release or otherwise deal with
any property pledged, mortgaged or otherwise securing such Senior Indebtedness;
(iii) release any Person liable in any manner for the collection of such Senior
Indebtedness; and (iv) exercise or refrain from exercising any rights against
the Company and any other Person.
ARTICLE XIV
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 14.01. Extension of Interest Payment Period.
So long as no Event of Default has occurred and is continuing, the
Company shall have the right, at any time and from time to time during the term
of the Notes, to defer payments of interest by extending the interest payment
period of such Securities for a period not exceeding 20 consecutive quarterly
periods, including the first such quarterly period during such extension period
(the "Extended Interest Payment Period"), during which Extended Interest Payment
Period no interest shall be due and payable on the Securities; provided that no
Extended Interest Payment Period shall end on a date other than an Interest
Payment Date or extend beyond the Maturity Date. At the end of the Extended
Interest Payment Period, the Company shall pay all interest accrued and unpaid
on the Notes, that shall be payable to the holders of the Notes in whose names
the Notes are registered in the Note Register on the first record date preceding
the end of the Extended Interest Payment Period. Before the termination of any
Extended Interest Payment Period, the Company may further defer payments of
interest by further extending such period, provided that such period, together
with all such previous and further extensions within such Extended Interest
Payment Period, shall not exceed 20 consecutive quarterly periods, including the
first such quarterly period during such Extended Interest Payment Period, or
extend beyond the Maturity Date. Upon the termination of any Extended Interest
Payment Period and the payment of all Deferred Interest then due, the Company
may commence a new Extended Interest Payment Period, subject to the foregoing
requirements. No interest shall be due and payable during an Extended Interest
Payment Period, except at the end thereof, but the Company may prepay at any
time all or any portion of the interest accrued during an Extended Interest
Payment Period.
SECTION 14.02. Notice of Extension.
(a) If the Trust is the only registered holder of the Notes at the time
the Company selects an Extended Interest Payment Period (or elects to
extend any Extended Interest Payment Period), the Company shall give
written notice to the Administrative Trustees of its selection of such
Extended Interest Payment Period (or any extension thereof), five
Business Days before the next succeeding date on which Distributions on
the Trust Securities issued by the Trust are payable. The
Administrative Trustees shall thereafter give written notice of the
Company's election to begin or extend the Extended Interest Payment
Period to the holders of the Notes. and the holder of the Trust
Securities.
(b) If the Trust is not the only holder of the Notes at the time the
Company selects an Extended Interest Payment Period (or elects to
extend any Extended Interest Payment Period), the Company shall give
the holders of the Notes written notice of its selection of such
Extended Interest Payment Period (or any extension thereof) at least 10
Business Days before the next succeeding Interest Payment Date.
(c) The quarterly period in which any notice is given pursuant to
paragraphs (a) or (b) of this Section 14.02 shall be counted as one of
the 20 quarterly periods permitted in the maximum Extended Interest
Payment Period permitted under Section 14.01.
IN WITNESS WHEREOF, the parties hereto have caused this Note to be duly
executed by their respective officers thereunto duly authorized, as of the day
and year first above written.
FBL FINANCIAL GROUP, INC. FBL FINANCIAL GROUP CAPITAL TRUST
By: /s/ William J. Oddy By: /s/ Stephen M. Morain
--------------------------------- --------------------------------
Name: William J. Oddy Stephen M. Morain, Initial
------------------------------- --------------------------------
Title: Chief Operating Officer Administrative Trustee
------------------------------ --------------------------------
EXHIBIT 4.5
====================================================
PREFERRED SECURITIES GUARANTEE AGREEMENT
FBL FINANCIAL GROUP CAPITAL TRUST
Dated as of May 30, 1997
====================================================
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.1 Definitions and Interpretation
ARTICLE II
GUARANTEE
SECTION 2.1 Guarantee
SECTION 2.2 Waiver of Notice and Demand
SECTION 2.3 Obligations Not Affected
SECTION 2.4 Rights of Holders
SECTION 2.5 Guarantee of Payment
SECTION 2.6 Subrogation
SECTION 2.7 Independent Obligations
ARTICLE III
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 3.1 Limitation of Transactions
SECTION 3.2 Ranking
ARTICLE IV
TERMINATION
SECTION 4.1 Termination
ARTICLE V
MISCELLANEOUS
SECTION 5.1 Successors and Assigns
SECTION 5.2 Amendments
SECTION 5.3 Notices
SECTION 5.4 Benefit
SECTION 5.5 Execution in Counterparts
SECTION 5.6 Governing Law
PREFERRED SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Preferred Securities Guarantee"), dated
as of May 30, 1997, is executed and delivered by FBL Financial Group, Inc., an
Iowa corporation (the "Guarantor"), for the benefit of the Holders (as defined
herein) from time to time of the Preferred Securities (as defined herein) of FBL
Financial Group Capital Trust, a Delaware statutory business trust (the
"Issuer").
WHEREAS, pursuant to the Declaration (as defined herein), the Issuer is
issuing on the date hereof 97,000 Preferred Securities, having an aggregate
liquidation amount of $97,000,000, such Preferred securities being designated
the 5% Preferred Securities (the "Preferred Securities").
WHEREAS, as incentive for the Holders to purchase the Preferred
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth in this Preferred Securities Guarantee, to pay to the
Holders the Guarantee Payments (as defined herein).
NOW, THEREFORE, in consideration of the purchase by each Holder, which
purchase the Guarantor hereby acknowledges shall benefit the Guarantor, the
Guarantor executes and delivers this Preferred Securities Guarantee for the
benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation.
In this Preferred Securities Guarantee, unless the context otherwise
requires:
(a) Capitalized terms used in this Preferred Securities Guarantee but
not defined in the preamble above have the respective meanings assigned to them
in this Section 1.1;
(b) terms defined in the Declaration as at the date of execution of
this Preferred Securities Guarantee have the same meaning when used in this
Preferred Securities Guarantee unless otherwise defined in this Preferred
Securities Guarantee;
(c) a term defined anywhere in this Preferred Securities Guarantee has
the same meaning throughout;
(d) all references to "the Preferred Securities Guarantee" or "this
Preferred Securities Guarantee" are to this Preferred Securities Guarantee as
modified, supplemented or amended from time to time;
(e) all references in this Preferred Securities Guarantee to Articles
and Sections are to Articles and Sections of this Preferred Securities
Guarantee, unless otherwise specified;
(f) a reference to the singular includes the plural and vice versa.
"AFFILIATE" has the same meaning as given to that term in Rule 405
under the Securities Act of 1933, as amended, or any successor rule thereunder.
"DECLARATION" means the Declaration of Trust, dated as of May 30, 1997,
as amended, modified or supplemented from time to time, among the trustees, the
Issuer, the Guarantor, as sponsor, and the holders from time to time of
undivided beneficial interests in the assets of the Issuer.
"GUARANTEE PAYMENTS" means the following payments or distributions,
without duplication, with respect to the Preferred Securities, to the extent not
paid or made by the Issuer: (i) any accumulated and unpaid Distributions (as
defined in the Declaration) that are required to be paid on such Preferred
Securities to the extent the Issuer has funds legally available therefor at such
time, (ii) the redemption price, including all accumulated and unpaid
Distributions to the date of redemption (the "Redemption Price") to the extent
the Issuer has funds legally available therefor at such time, with respect to
any Preferred Securities called for redemption by the Issuer, and (iii) upon a
voluntary or involuntary termination and liquidation of the Issuer (other than
in connection with the distribution of Notes to the Holders in exchange for
Preferred Securities as provided in the Declaration), the lesser of (a) the
aggregate of the liquidation amount and all accumulated and unpaid Distributions
on the Preferred Securities to the date of payment, to the extent the Issuer has
funds legally available therefor, and (b) the amount of assets of the Issuer
remaining available for distribution to Holders in liquidation of the Issuer (in
either case, the "Liquidation Distribution").
"HOLDER" shall mean any holder, as registered on the books and records
of the Issuer, of any Preferred Securities; provided, however, that, in
determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Guarantor.
"MAJORITY IN LIQUIDATION AMOUNT OF THE PREFERRED SECURITIES" means, a
vote by the Holder(s) of more than 50% of the aggregate liquidation amount
(including the stated amount that would be paid on redemption, liquidation or
otherwise, plus accumulated and unpaid Distributions to the date upon which the
voting percentages are determined) of all Preferred Securities. In determining
whether the Holders of the requisite amount of Preferred Securities have voted,
Preferred Securities which are owned by the Guarantor on the Preferred
Securities shall be disregarded for the purpose of any such determination.
"NOTE" means the Note dated as of May 30, 1997, in the principal amount
of $100,000,000 and any Note or Notes supplemental thereto pursuant to which the
Notes are to be issued to the Administrative Trustees (as defined in the
Declaration) of the Issuer.
"NOTE AGREEMENT" means the Subordinated Deferrable Interest Note
Agreement dated as of May 30, 1997 pursuant to which the Notes are issued by the
Guarantor to the Trust (as defined in the Declaration).
"NOTES" means the subordinated deferrable interest notes to be issued
by the Guarantor designated the 5% Subordinated Deferrable Interest Notes due
June 30, 2047 held by the Trust (as defined in the Declaration) of the Issuer.
"PERSON" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
ARTICLE II
GUARANTEE
SECTION 2.1 Guarantee.
The Guarantor irrevocably and unconditionally agrees to pay in full to
the Holders the Guarantee Payments (without duplication of amounts theretofore
paid by the Issuer), as and when due, regardless of any defense, right of
set-off or counterclaim that the Issuer may have or assert other than the
defense of payment. The Guarantor's obligation to make a Guarantee Payment may
be satisfied by direct payment of the required amounts by the Guarantor to the
Holders or by causing the Issuer to pay such amounts to the Holders.
SECTION 2.2 Waiver of Notice and Demand.
The Guarantor hereby waives notice of acceptance of this Preferred
Securities Guarantee and of presentment, demand for payment, any right to
require a proceeding first against the Issuer or any other Person before
proceeding against the Guarantor, protest, notice of nonpayment, notice of
dishonor, notice of redemption and all other notices and demands.
Notwithstanding anything to the contrary herein, the Guarantor retains all of
its rights under the Note Agreement to extend the interest payment period on the
Notes (in accordance with the terms of the Note Agreement) and the Guarantor
shall not be obligated hereunder to make any Guarantee Payments during any
Extended Interest Payment Period (as defined in the Note Agreement) with respect
to the Distributions (as defined in the Declaration) on the Preferred
Securities.
SECTION 2.3 Obligations Not Affected.
Except as otherwise provided herein, the obligations, covenants,
agreements and duties of the Guarantor under this Preferred Securities Guarantee
shall in no way be affected or impaired by reason of the happening from time to
time of any of the following:
(a) The release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Preferred Securities to be performed
or observed by the Issuer;
(b) The extension of time for the payment by the Issuer of all or any
portion of the Distributions, Redemption Price, Liquidation Distribution or any
other sums payable under the terms of the Preferred Securities or the extension
of time for the performance of any other obligation under, arising out of, or in
connection with, the Preferred Securities (other than an extension of time for
payment of Distributions, Redemption Price, Liquidation Distribution or other
sums payable that results from the extension of any interest payment period on
the Notes permitted by the Note Agreement);
(c) Any failure, omission, delay or lack of diligence on the part of
the Administrative Trustees (as defined in the Declaration) or the Holders to
enforce, assert or exercise any right, privilege, power or remedy conferred on
the Administrative Trustees (as defined in the Declaration) or the Holders
pursuant to the terms of the Preferred Securities, or any action on the part of
the Issuer granting indulgence or extension of any kind;
(d) The voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt of,
or other similar proceedings affecting, the Issuer or any of the assets of the
Issuer;
(e) Any invalidity of, or defect or deficiency in, the Preferred
Securities;
(f) The settlement or compromise of any obligation guaranteed hereby or
hereby incurred; or
(g) Any other circumstance whatsoever that might otherwise constitute a
legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 1.3 that the obligations of the Guarantor with respect to the
Guarantee Payments shall be absolute and unconditional under any and all
circumstances.
There shall be no obligation of the Holders to give notice to, or
obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.
No setoff, counterclaim, reduction or diminution of any obligation, or
any defense of any kind or nature that the Guarantor has or may have against any
Holder shall be available hereunder to the Guarantor against such Holder to
reduce the payments to it under this Preferred Securities Guarantee.
SECTION 2.4 Rights of Holders.
(a) The Holders of a Majority in liquidation amount of the Preferred
Securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Holders in respect of this Preferred
Securities Guarantee.
(b) Any Holder may, to the extent permitted under applicable law,
institute a legal proceeding directly against the Guarantor to enforce the
Holder's rights under this Preferred Securities Guarantee, without first
instituting a legal proceeding against the Issuer, or any other person or
entity. If the Guarantor has failed to make a Guarantee Payment, a Holder may
directly institute a proceeding against the Guarantor for enforcement of this
Preferred Securities Guarantee for such payment to the Holder, and the amount of
the payment will be based on the Holder's pro rata share of the amount due and
owing on all of the Preferred Securities. The Guarantor hereby waives any right
or remedy to require that any action on this Preferred Securities Guarantee be
brought first against the Issuer or any other person or entity before proceeding
directly against the Guarantor.
SECTION 2.5 Guarantee of Payment.
This Preferred Securities Guarantee creates a guarantee of payment and
not of collection.
SECTION 2.6 Subrogation.
The Guarantor shall be subrogated to all (if any) rights of the Holders
against the Issuer in respect of any amounts paid to such Holders by the
Guarantor under this Preferred Securities Guarantee; provided, however, that the
Guarantor shall not (except to the extent required by mandatory provisions of
law) be entitled to enforce or exercise any right that it may acquire by way of
subrogation or any indemnity, reimbursement or other agreement, in all cases as
a result of payment under this Preferred Securities Guarantee, if, at the time
of any such payment, any amounts are due and unpaid under this Preferred
Securities Guarantee. If any amount shall be paid to the Guarantor in violation
of the preceding sentence, the Guarantor agrees to hold such amount in trust for
the Holders and to pay over such amount to the Holders.
SECTION 2.7 Independent Obligations.
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Preferred
Securities, and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Preferred
Securities Guarantee notwithstanding the occurrence of any event referred to in
subsections (a) through (g), inclusive, of Section 1.3 hereof.
ARTICLE III
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 3.1 Limitation of Transactions.
So long as any Preferred Securities remain outstanding, the Guarantor
shall not (i) declare or pay any dividends or distributions on, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of the
Guarantor's stock (which includes Class A Common Stock, Class B Common Stock and
preferred stock), (ii) make any payment of principal, interest, or premium, if
any, on or repay, repurchase or redeem any debt securities of the Guarantor that
rank pari passu with or junior in right of payment to the Notes or (iii) make
any guarantee payments with respect to any guarantee by the Guarantor of any
securities of any subsidiary of the Guarantor if such guarantee ranks pari passu
with or junior in right of payment to the Notes (other than (a) dividends or
distributions in shares of or options, warrants or rights to subscribe for or
purchase shares of, common stock of the Guarantor, (b) any declaration of a
dividend in connection with the implementation of a stockholder's rights plan,
or the issuance of stock under any such plan in the future, or the redemption or
repurchase of any such rights pursuant thereto, (c) payments under this
Preferred Securities Guarantee, (d) as a direct result of, and only to the
extent required in order to avoid the issuance of fractional shares of preferred
stock following, a reclassification of the Guarantor's preferred stock or the
exchange or conversion of one class or series of the Guarantor's preferred stock
for another class or series of the Guarantor's preferred stock or pursuant to an
acquisition in which fractional shares of the Guarantor's preferred stock would
otherwise be issued, (e) the purchase of fractional interests in shares of the
Guarantor's preferred stock pursuant to the conversion or exchange provisions of
such Preferred stock or the security being converted or exchanged, and (f)
purchases of common stock related to the issuance of common stock or rights
under any benefit plan for directors, officers, agents or employees of the
Guarantor or its Affiliates or Subsidiaries or any of the Guarantor's dividend
reinvestment or director, officer, agent or employee stock purchase plans), if
at such time (i) an Event of Default (as defined in the Note Agreement) shall
have occurred and be continuing, or would occur upon the taking of any action
specified in clauses (i) through (iii) above, (ii) there shall have occurred any
event of which the Guarantor has actual knowledge that (a) is, or with the
giving of notice or the lapse of time, or both, would be an Event of Default (as
defined in the Note Agreement) and (b) in respect of which the Guarantor shall
not have taken reasonable steps to cure, (iii) the Guarantor shall be in default
with respect to its payment of any obligations under this Preferred Securities
Guarantee or (iv) the Guarantor shall have given notice of its election of the
exercise of its right to extend the interest payment period pursuant to Section
14.01 of the Note Agreement and any such extension shall be continuing.
SECTION 3.2 Ranking.
This Preferred Securities Guarantee will constitute an unsecured
obligation of the Guarantor and will rank (i) subordinate and junior in right of
payment to all Senior Indebtedness (as defined in the Note Agreement), to the
same extent and in the same manner that the Notes are subordinated to Senior
Indebtedness pursuant to the Note Agreement, it being understood that the terms
of Article XIII of the Note Agreementshall apply to the obligations of the
Guarantor under this Preferred Securities Guarantee as if (x) such Article XIII
were set forth herein in full and (y) such obligations were substituted for the
term "Notes" appearing in such Article XV, (ii) Subordinate and junior in right
of payment to all other liabilities of the Guarantor, except those liabilities
of the Guarantor made pari passu or subordinate by their terms, (iii) pari passu
with the most senior preferred or preference stock now or hereafter issued by
the Guarantor and any guarantee now or hereafter entered into by the Guarantor
in respect of any preferred stock of any Affiliate of the Guarantor, and (iv)
senior to the Guarantor's common stock.
ARTICLE IV
TERMINATION
SECTION 4.1 Termination.
This Preferred Securities Guarantee shall terminate upon full payment
of the Redemption Price of all Preferred Securities, or upon liquidation of the
Issuer, the full payment of the amounts payable in accordance with the
Declaration or the distribution of the Notes to the Holders of all of the
Preferred Securities. Notwithstanding the foregoing, this Preferred Securities
Guarantee will continue to be effective or will be reinstated, as the case may
be, if at any time any Holder must restore payment of any sums paid under the
Preferred Securities or under this Preferred Securities Guarantee.
ARTICLE V
MISCELLANEOUS
SECTION 5.1 Successors and Assigns.
All guarantees and agreements contained in this Preferred Securities
Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
then outstanding.
SECTION 5.2 Amendments.
Except with respect to any changes that do not materially adversely
affect the rights of Holders (in which case no consent of Holders will be
required), this Preferred Securities Guarantee may only be amended with the
prior approval of the Holders of a Majority in liquidation amount of the
Preferred Securities. The provisions of the Declaration with respect to consents
to amendments thereof (whether at a meeting or otherwise) shall apply to the
giving of such approval.
SECTION 5.3 Notices.
All notices provided for in this Preferred Securities Guarantee shall
be in writing, duly signed by the party giving such notice, and shall be
delivered, telecopied or mailed by first class mail, as follows:
(a) If given to the Guarantor, at the Guarantor's mailing address set
forth below (or such other address as the Guarantor may give notice of to the
Holders of the Preferred Securities):
FBL Financial Group, Inc.
5400 University Avenue
West Des Moines, Iowa 50266
Attention: Chief Executive Officer
(b) If given to any Holder of Preferred Securities, at the address set
forth on the books and records of the Issuer.
(d) If given to the Issuer, in care of the Administrative Trustees at
the Issuer's mailing address set forth below (or such other address as the
Issuer may give notice of to the Holders):
FBL Financial Group Capital Trust
c/o FBL Financial Group, Inc.
5400 University Avenue
West Des Moines, Iowa 50266
Attn: Stephen M. Morain, Thomas R. Gibson and Richard D. Harris
All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid, except that if a notice or other document is refused delivery
or cannot be delivered because of a changed address of which no notice was
given, such notice or other document shall be deemed to have been delivered on
the date of such refusal or inability to deliver.
SECTION 5.4 Benefit.
This Preferred Securities Guarantee is solely for the benefit of the
Holders of the Preferred Securities and is not separately transferable from the
Preferred Securities.
SECTION 5.5 Execution in Counterparts.
This Preferred Securities Guarantee may be executed in any number of
counterparts, each of which shall be an original, but such counterparts shall
constitute but one and the same instrument.
SECTION 5.6 Governing Law.
This Preferred Securities Guarantee shall be governed by, and construed
and interpreted in accordance with, the laws of the state of Iowa, without
regard to conflicts of law principles thereof.
IN WITNESS WHEREOF, this Preferred Securities Guarantee is executed as
of the day and year first above written.
FBL FINANCIAL GROUP, INC. AS GUARANTOR
By: /s/ William J. Oddy
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Name: William J. Oddy
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Title: Chief Operating Officer
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