SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: November 15, 1994
(Date of earliest event reported)
AETNA LIFE AND CASUALTY COMPANY
(Exact name of registrant as specified in its charter)
Connecticut
(State of incorporation or organization)
1-5704
(Commission File No.)
06-0843808
(IRS Employer Identification Number)
151 Farmington Avenue, Hartford, Connecticut 06156
(Address of principal executive offices, including zip code)
(203) 273-0123
(Registrant's telephone number, including zip code)
Not Applicable
(Former name or former address,
if changed since last report)
Item 5. Other Events.
On November 15, 1994 the Registrant and Aetna Capital L.L.C., a Delaware
limited liability company ("Capital"), entered into a Pricing Agreement with
Goldman, Sachs & Co., CS First Boston Corporation, Dean Witter Reynolds Inc.,
A.G. Edwards & Sons, Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Morgan Stanley & Co. Incorporated, PaineWebber Incorporated and Smith Barney
Inc., as representatives of the several underwriters named therein (such
Pricing Agreement, together with the Underwriting Agreement dated November 15,
1994 entered into by the Registrant and Capital and incorporated by reference
therein (the "Underwriting Agreement")), relating to the offer and sale of
Capital's 91/2% Cumulative Monthly Income Preferred Securities, Series A (the
"Series A Preferred Securities") guaranteed by the Registrant to the extent
set forth in the Prospectus dated October 7, 1994 as supplemented by the
Prospectus Supplement dated November 15, 1994 relating to the offering of the
Series A Preferred Securities.
Item 7. Financial Statements and Exhibits
(c) Exhibits
1. Underwriting Agreement.
2. Written Action dated as of November 15, 1994 establishing the terms
of the Series A Preferred Securities.
3. Subordinated Indenture dated as of November 1, 1994 between the
Registrant and The First National Bank of Chicago, as Trustee.
4. Certificate of Designated Officer of the Registrant dated as of
November 15, 1994 establishing the terms of the Registrant's 91/2%
Series A Subordinated Debentures due November 22, 2024 pursuant to
the Indenture dated as of November 1, 1994 between the Registrant and
The First National Bank of Chicago, as Trustee.
5. Form of the Registrant's 91/2% Series A Subordinated Debenture due
November 22, 2024.
6. Payment and Guarantee Agreement dated November 22, 1994 of the
Registrant with respect to Capital.
7. Agreement as to Expenses and Liabilities dated November 22, 1994
between the Registrant and Capital.
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
November 22, 1994
AETNA LIFE AND CASUALTY COMPANY
By: /s/ ROBERT E. BROATCH
---------------------------
Robert E. Broatch
Senior Vice President,
Finance and Corporate Controller
of Aetna Life and Casualty Company
EXHIBIT INDEX
Exhibit
No. Exhibit Name
_______ ____________
1. Underwriting Agreement.
2. Written Action dated as of November 15, 1994 establishing the terms
of the Series A Preferred Securities.
3. Subordinated Indenture dated as of November 1, 1994 between the
Registrant and The First National Bank of Chicago, as Trustee.
4. Certificate of Designated Officer of the Registrant dated as of
November 15, 1994 establishing the terms of the Registrant's 91/2%
Series A Subordinated Debentures due November 22, 2024 pursuant to
the Indenture dated as of November 1, 1994 between the Registrant and
The First National Bank of Chicago, as Trustee.
5. Form of the Registrant's 91/2% Series A Subordinated Debenture due
November 22, 2024.
6. Payment and Guarantee Agreement dated November 22, 1994 of the
Registrant with respect to Capital.
7. Agreement as to Expenses and Liabilities dated November 22, 1994
between the Registrant and Capital.
EXHIBIT 1
AETNA CAPITAL L.L.C.
AETNA LIFE AND CASUALTY COMPANY
Preferred Securities
_______________
Underwriting Agreement
November 15, 1994
To the Underwriters
to be named in the applicable
Pricing Agreement
supplemental hereto
Ladies and Gentlemen:
From time to time Aetna Capital L.L.C., a limited liability
company formed under the laws of Delaware (the "Company"), and Aetna Life and
Casualty Company, a Connecticut insurance corporation ("Aetna"), as guarantor
and provider of certain backup obligations, propose to enter into one or more
Pricing Agreements (each a "Pricing Agreement") in the form of Annex I hereto,
with such additions and deletions as the parties thereto may determine and
subject to the terms and conditions stated herein and therein, pursuant to
which the Company will issue to the firms named in Schedule I to the
applicable Pricing Agreement (such firms constituting the "Underwriters" with
respect to such Pricing Agreement and the securities specified therein) its
Preferred Limited Liability Company Interests (the "Preferred Securities"), in
one or more series, guaranteed by Aetna to the extent set forth in the
prospectus and registration statement described herein and to sell such
Preferred Securities (with respect to such Pricing Agreement, the "Firm
Designated Preferred Securities"). If specified in such Pricing Agreement, the
Company may grant to the Underwriters the right to purchase at their election
an additional number of Preferred Securities, specified in such Pricing
Agreement as provided in Section 3 hereof (the "Optional Designated Preferred
Securities"). The Firm Designated Preferred Securities and any Optional
Designated Preferred Securities are collectively called the "Designated
Preferred Securities."
The terms and rights of any particular issuance of Designated
Preferred Securities shall be as specified in the Pricing Agreement relating
thereto (to the extent not set forth in the registration statement or
prospectus with respect thereto) and in or pursuant to a written action or
actions taken by Aetna and Aetna Capital Holdings, Inc., a Connecticut
corporation ("Aetna Capital"), in their capacity as the members (the "Managing
Members") of the Company that hold all of the Common Limited Liability Company
Interests (the "Common Securities"). The Company will loan the proceeds of
the offering of the Designated Preferred Securities to Aetna, such loan to be
evidenced by a series of debentures (the "Related Debentures") to be issued by
Aetna pursuant to the Subordinated Indenture (the "Indenture") between the
Company and The First National Bank of Chicago, as trustee (the "Trustee").
1. Particular sales of Designated Preferred Securities may be
made from time to time to the Underwriters of such Designated Preferred
Securities, for whom the firms designated as representatives of the
Underwriters of such Designated Preferred Securities in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The
term "Representatives" also refers to a single firm acting as sole
representative of the Underwriters and to Underwriters who act without any firm
being designated as their representative. Except as incorporated by reference
into a Pricing Agreement, this Underwriting Agreement shall not be construed
as an obligation of the Company to issue any Preferred Securities or sell any
Preferred Securities or as an obligation of any of the Underwriters to
purchase any of the Preferred Securities. The obligation of the Company to
issue any Preferred Securities and to sell any Preferred Securities and the
obligation of any of the Underwriters to purchase any of the Preferred
Securities shall be evidenced by the Pricing Agreement with respect to the
Designated Preferred Securities specified therein.
Each Pricing Agreement shall specify, among other things, the
number of Firm Designated Preferred Securities, the maximum number of Optional
Designated Preferred Securities, if any, the initial public offering price of
such Firm and Optional Designated Preferred Securities or the manner of
determining such price, the purchase price to the Underwriters of such
Designated Preferred Securities, the amount of any compensation to be paid to
the Underwriters by Aetna for their services thereunder ("Underwriters'
Compensation"), the names of the Underwriters of such Designated Preferred
Securities, the names of the Representatives of such Underwriters, the number
of such Designated Preferred Securities to be purchased by each Underwriter
and the commission, if any, payable to the Underwriters with respect thereto
and shall set forth the date, time and manner of delivery of such Firm and
Optional Preferred Securities and payment therefor. The Pricing Agreement
shall also specify (to the extent not set forth in the registration statement
or prospectus with respect thereto) the terms of such Designated Preferred
Securities. A Pricing Agreement shall be in the form of an executed writing
(which may be in counterparts), and may be evidenced by an exchange of
telegraphic communications or any other rapid transmission device designed to
produce a written record of communications transmitted. The obligations of
the Underwriters under this Agreement and each Pricing Agreement shall be
several and not joint.
2. Each of the Company and Aetna, jointly and severally,
represents and warrants to, and agrees with, each of the Underwriters that:
(a) A registration statement in respect of the Preferred
Securities has been filed with the Securities and Exchange Commission
(the "Commission"); such registration statement and any post-effective
amendments thereto, each in the form heretofore delivered or to be
delivered to the Representatives (with exhibits thereto) for delivery
to each of the other Underwriters (without exhibits thereto), have
been declared effective by the Commission in such form; no other
document with respect to such registration statement or document
incorporated by reference therein has been filed or transmitted for
filing with the Commission prior to the effective date of the
registration statement; and no stop order suspending the
effectiveness of such registration statement has been issued and no
proceeding for that purpose has been initiated or, to the knowledge
of the Company or Aetna, threatened by the Commission. Any
preliminary prospectus included in such registration statement or
filed with the Commission pursuant to Rule 424(a) of the rules and
regulations of the Commission under the Securities Act of 1933, as
amended (the "Act"), is hereinafter collectively called a "Preliminary
Prospectus"; the various parts of such registration statement,
including all exhibits thereto and the information, if any, deemed to
be part of such registration statement at the time of effectiveness
pursuant to Rule 430A under the Act, but excluding Form T-1, each as
amended at the time such part of the registration statement became
effective are hereinafter collectively called the "Registration
Statement"; the prospectus relating to the Preferred Securities, in
the form in which it has most recently been filed, or transmitted for
filing, with the Commission on or prior to the date of this
Agreement, is hereinafter called the "Prospectus"; any reference
herein to any Preliminary Prospectus or the Prospectus shall be
deemed to refer to and include the documents incorporated by
reference therein pursuant to the applicable form under the Act, as
of the date of such Preliminary Prospectus or Prospectus, as the case
may be; any reference to any amendment or supplement to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include any documents filed with the Commission after the date of
such Preliminary Prospectus or Prospectus, as the case may be, under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and incorporated by reference in such Preliminary Prospectus or
Prospectus, as the case may be; any reference to any amendment to the
Registration Statement shall be deemed to refer to and include any
annual report of Aetna filed pursuant to Section 13(a) or 15(d) of
the Exchange Act after the effective date of the Registration
Statement that is incorporated by reference in the Registration
Statement; and any reference to the Prospectus as amended or
supplemented shall be deemed to refer to the Prospectus as amended
or supplemented in relation to the applicable Designated Preferred
Securities in the form in which it is first filed with the Commission
pursuant to Rule 424(b) under the Act in accordance with Section 5(a)
hereof, including any documents incorporated by reference therein as
of the date of such filing;
(b) The Registration Statement and the Prospectus
conform, and any further amendments or supplements to the
Registration Statement or the Prospectus will conform, in all
material respects to the requirements of the Act and the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), and
the rules and regulations of the Commission thereunder and do not and
will not, as of the applicable effective date as to the Registration
Statement and any amendment thereto and as of the applicable filing
date as to the Prospectus and any amendment or supplement thereto,
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein (i) in the case of the Registration Statement, not
misleading and (ii) in the case of the Prospectus, in light of the
circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company or Aetna by an
Underwriter of Designated Preferred Securities through the
Representatives for use in the Prospectus as amended or supplemented
relating to such Designated Preferred Securities;
(c) Aetna has been duly incorporated and is validly
existing as an insurance corporation in good standing under the laws
of the State of Connecticut;
(d) The Company has been duly formed and is validly
existing as a limited liability company in good standing under the
laws of the State of Delaware;
(e) Aetna Capital has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
the State of Connecticut;
(f) The Preferred Securities have been duly authorized
by the Managing Members and, when the terms of the Designated
Preferred Securities have been established by a written action or
actions taken by the Managing Members and issued and delivered and
paid for pursuant to this Agreement and the Pricing Agreement with
respect to such Designated Preferred Securities, such Designated
Preferred Securities will be validly issued, fully paid and
non-assessable limited liability company interests in the Company, as
to which the members of the Company who hold such Designated
Preferred Securities (the "Preferred Securityholders"), in their
capacity as members of the Company, will have no liability solely by
reason of being Preferred Securityholders in excess of their share of
the Company's assets and undistributed profits (subject to any
obligation of a Preferred Securityholder to repay any funds
wrongfully distributed to it), except as described in the Prospectus
under the caption "Description of the Preferred Securities --
Registrar, Transfer Agent and Paying Agent; Transfers and Exchanges";
and the Designated Preferred Securities will conform, in all material
respects, to the descriptions thereof contained in the Prospectus as
amended or supplemented with respect to such Designated Preferred
Securities;
(g) The Amended and Restated Limited Liability Company
Agreement of the Company ("L.L.C. Agreement"), which is in
substantially the form filed as an exhibit to the Registration
Statement, constitutes a valid and legally binding agreement of Aetna
and Aetna Capital, enforceable against Aetna and Aetna Capital by the
Preferred Securityholders in accordance with its terms, subject to
(1) bankruptcy, insolvency, reorganization, fraudulent transfer,
moratorium and other similar laws now or hereafter in effect relating
to or affecting creditors' rights generally, (2) general principles
of equity (regardless of whether considered in a proceeding at law or
in equity) and (3) applicable laws relating to fiduciary duties;
(h) Each of the guarantee of certain obligations of the
Company by Aetna for the benefit of the Preferred Securityholders
from time to time (the "Guarantee Agreement") and the guarantee by
Aetna of certain liabilities of the Company for the benefit of
persons other than such Preferred Securityholders (the "Expense
Agreement"), each of which will be substantially in the form filed as
an exhibit to the Registration Statement, has been duly authorized by
Aetna and, when executed and delivered by Aetna and, in the case of
the Expense Agreement, the Company, and will constitute a valid and
legally binding agreement of Aetna enforceable against Aetna in
accordance with its terms, subject to (1) bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium and other similar
laws now or hereafter in effect relating to or affecting creditors'
rights and the rights of creditors of insurance companies generally
and (2) general principles of equity (regardless of whether
considered in a proceeding at law or in equity); and each of the
Guarantee Agreement and the Expense Agreement will conform, in all
material respects, to the description thereof contained in the
Prospectus as amended or supplemented with respect to the Designated
Preferred Securities;
(i) The Related Debentures have been duly authorized by
Aetna, and, when the Related Debentures are issued, executed,
authenticated, delivered and paid for in accordance with the
Indenture, such Debentures will be duly issued, executed and
delivered and will constitute valid and legally binding obligations of
Aetna enforceable against Aetna in accordance with their terms,
subject to (1) bankruptcy, insolvency, reorganization, fraudulent
transfer, moratorium and other similar laws now or hereafter in
effect relating to or affecting creditors' rights generally and the
rights of creditors of insurance companies generally and (2) general
principles of equity (regardless of whether considered in a
proceeding at law or in equity); the Indenture, which will be
substantially in the form filed as an exhibit to the Registration
Statement, has been duly authorized by the Company and duly qualified
under the Trust Indenture Act and, assuming due authorization,
execution and delivery by the Trustee, the Indenture will constitute
a valid and legally binding instrument of Aetna enforceable against
Aetna in accordance with its terms, subject to (1) bankruptcy,
insolvency, reorganization, fraudulent transfer, moratorium and other
similar laws now or hereafter in effect relating to or affecting
creditors' rights generally and the rights of creditors of insurance
companies generally and (2) general principles of equity (regardless
of whether considered in a proceeding at law or in equity); and the
Indenture conforms, and the Related Debentures will conform, in all
material respects, to the descriptions thereof contained in the
Prospectus as amended or supplemented with respect to such Designated
Preferred Securities;
(j) The issue and sale of the Designated Preferred
Securities and the performance by the Company and Aetna of their
respective obligations under this Agreement, any Pricing Agreement,
the Indenture, the Related Debentures, the Guarantee Agreement, the
Expense Agreement and each Over-allotment Option (as defined in
Section 3 hereof), if any, and the consummation of the transactions
herein and therein contemplated will not (1) conflict with or result
in a breach or violation by the Company or Aetna of any of the terms
or provisions of, or constitute a default by the Company or Aetna
under, any indenture, mortgage, deed of trust, loan agreement or
other similar agreement or instrument to which the Company or Aetna
is a party or by which the Company or Aetna is bound or to which any
of the property or assets of the Company or Aetna is subject, except,
in all such cases, for such conflicts, breaches, violations or
defaults as would neither have a material adverse effect on the
financial condition of Aetna and its subsidiaries taken as a whole
nor have a material adverse effect on the issuance or sale of the
Designated Preferred Securities, or (2) result in any violation of
(A) the provisions of the Certificate of Formation of the Company or
the L.L.C. Agreement or the Certificate of Incorporation or By-Laws
of Aetna or (B) any statute of the United States or the States of
Connecticut, New York or Delaware or any order, rule or regulation of
any court or governmental agency or body of the United States or the
States of Connecticut, New York or Delaware having jurisdiction over
the Company or Aetna or any of their respective properties; provided,
however that in the case of clause (B) of this paragraph 2(i), this
representation and warranty shall not extend to such violations as
would neither have a material adverse effect on the financial
condition of Aetna and its subsidiaries taken as a whole nor have a
material adverse effect on the issuance or sale of the Designated
Preferred Securities; provided further, that insofar as this
representation and warranty relates to the performance by the Company
and Aetna of each of their respective obligations under this
Agreement, the Pricing Agreement relating to the Designated Preferred
Securities, the Designated Preferred Securities, the Indenture, the
Related Debentures, the Guarantee Agreement and the Expense
Agreement, such performance is subject to bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium and other similar laws
now or hereafter in effect relating to or affecting creditors' rights
generally and the rights of creditors of insurance companies
generally;
(k) No consent, approval, authorization, order,
registration, filing or qualification of or with any court or
governmental agency or body of the United States or the States of
Connecticut, New York or Delaware is required for the issue and sale
of the Preferred Securities or the issuance of the Related Debentures
or the consummation by the Company or Aetna of the transactions
contemplated by this Agreement, any Pricing Agreement, the Indenture,
the Guarantee Agreement or the Expense Agreement or any
Over-allotment Option, except such as have been, or will have been
prior to the Time of Delivery obtained under the Act or the Trust
Indenture Act or from the Connecticut Insurance Commissioner and such
consents, approvals, authorizations, orders, registrations, filings
or qualifications as may be required under state securities or Blue
Sky laws or insurance securities laws of any such jurisdiction in
connection with the purchase and distribution of the Designated
Preferred Securities by the Underwriters, and except those which, if
not obtained, will have neither a material adverse effect on the
financial condition of Aetna and its subsidiaries taken as a whole
nor a material adverse effect on the issuance or sale of the
Designated Preferred Securities;
(l) The Common Securities issued to the Managing
Members have been duly authorized and are validly issued;
(m) All of the issued Common Securities of the Company
and all of the capital stock of Aetna Capital are owned directly or
indirectly by Aetna; neither the Company nor Aetna Capital is a party
to or otherwise bound by any material agreement other than those
described in the Prospectus as amended or supplemented; and
(n) The Designated Preferred Securities have been
approved for listing on the New York Stock Exchange, subject to
official notice of issuance.
3. Upon the execution of the Pricing Agreement applicable to
any Designated Preferred Securities the several Underwriters propose to offer
the Firm Designated Preferred Securities for sale upon the terms and conditions
set forth in the Prospectus as amended or supplemented.
The Company may specify in the Pricing Agreement applicable to
any Designated Preferred Securities that the Company thereby grants to the
Underwriters the right (an "Over-allotment Option") to purchase at their
election up to the number of Optional Designated Preferred Securities set
forth in such Pricing Agreement, at the terms set forth in the paragraph
above, for the sole purpose of covering over-allotments in the sale of the
Firm Designated Preferred Securities. Any such election to purchase Optional
Designated Preferred Securities may be exercised only by written notice from
the Representatives to the Company and Aetna, given within a period specified
in the Pricing Agreement, setting forth the aggregate number of Optional
Designated Preferred Securities to be purchased and the date on which such
Optional Designated Preferred Securities are to be delivered, as determined by
the Representatives but in no event earlier than the First Time of Delivery
(as defined in Section 4 hereof) or, unless the Representatives, Aetna and the
Company otherwise agree in writing, earlier than or later than the respective
number of business days after the date of such notice set forth in such
Pricing Agreement.
The number of Optional Designated Preferred Securities to be
added to the number of Firm Designated Preferred Securities to be purchased by
each Underwriter as set forth in Schedule I to the Pricing Agreement applicable
to such Designated Preferred Securities shall be, in each case, the number of
Optional Designated Preferred Securities which each of the Company and Aetna
has been advised by the Representatives have been attributed to such
Underwriter, provided that, if each of the Company and Aetna has not been so
advised, the number of Optional Designated Preferred Securities to be so added
shall be, in each case, that proportion of Optional Designated Preferred
Securities which the number of Firm Designated Preferred Securities to be
purchased by such Underwriter under such Pricing Agreement bears to the
aggregate number of Firm Designated Preferred Securities (rounded as the
Representatives may determine to the nearest 100 securities). The total
number of Designated Preferred Securities to be purchased by all the
Underwriters pursuant to such Pricing Agreement shall be the aggregate number
of Firm Designated Preferred Securities set forth in Schedule I to such
Pricing Agreement plus the aggregate number of the Optional Designated
Preferred Securities which the Underwriters elect to purchase.
4. Unless otherwise specified in the applicable Pricing
Agreement, global certificates for the Firm Designated Preferred Securities
and Optional Designated Preferred Securities to be purchased by each
Underwriter pursuant to such Pricing Agreement, registered in the name "Cede &
Co.," shall be delivered by or on behalf of the Company to the Representatives
for the account of such Underwriter, against payment by such Underwriter or on
its behalf of the purchase price therefor by certified or official bank check
or checks, payable to the order of the Company or, if so requested by the
Company, by wire transfer to a bank account specified by the Company and
specified in Schedule II, in the funds specified in such Pricing Agreement.
The place, time and date of delivery of and payment for Firm Designated
Preferred Securities and Optional Designated Preferred Securities shall be as
specified in such Pricing Agreement or at such other place, time and date as
the Representatives, Aetna and the Company may agree upon in writing. Such
time and date for delivery of Firm Designated Preferred Securities pursuant to
the Pricing Agreement relating thereto is herein called the "First Time of
Delivery," such time and date for delivery of Optional Designated Preferred
Securities, if not the First Time of Delivery, is herein called the "Second
Time of Delivery," and each such time and date is herein called the "Time of
Delivery."
5. Each of the Company and Aetna, jointly and severally,
agrees with each of the Underwriters of any Designated Preferred Securities:
(a) To prepare the Prospectus as amended and
supplemented in relation to the applicable Designated Preferred
Securities and to file such Prospectus pursuant to Rule 424(b) under
the Act not later than the Commission's close of business on the
second business day following the execution and delivery of the
Pricing Agreement relating to the applicable Designated Preferred
Securities or, if applicable, such other time as may be required by
Rule 424(b); to advise the Representatives promptly of any proposal
to amend or supplement the Registration Statement or Prospectus as
amended or supplemented after the date of the Pricing Agreement
relating to such Designated Preferred Securities and prior to the
Time of Delivery for such Designated Preferred Securities, and afford
the Representatives a reasonable opportunity to comment on any such
proposed amendment or supplement; to advise the Representatives of
any such amendment or supplement promptly after such Time of Delivery
for so long as the delivery of a prospectus is required under the Act
in connection with the offering or sale of such Designated Preferred
Securities; to file promptly all reports and any definitive proxy or
information statements required to be filed by Aetna or the Company
with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act for so long as the delivery of a prospectus is
required under the Act in connection with the offering or sale of
such Designated Preferred Securities, and during such same period to
advise the Representatives, promptly after the Company or Aetna
receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed
with the Commission; for so long as the delivery of a prospectus is
required under the Act in connection with the offering or sale of the
Designated Preferred Securities, to advise the Representatives
promptly of the issuance by the Commission of any stop order or of
any order preventing or suspending the use of any prospectus relating
to the Designated Preferred Securities, of the suspension of the
qualification of such Designated Preferred Securities for offering or
sale in any jurisdiction or of the initiation or, if known to the
Company or Aetna, the threatening of any proceeding for any such
purpose, or of any request by the Commission for amending or
supplementing the Registration Statement or Prospectus; and, in the
event of the issuance of any such stop order or of any such order
preventing or suspending the use of any prospectus relating to the
Designated Preferred Securities or suspending any such qualification,
to use promptly its best efforts to obtain its withdrawal;
(b) Promptly from time to time to endeavor to take such
action as the Representatives may reasonably request to qualify such
Designated Preferred Securities for offering and sale under the
securities laws of such jurisdictions of the United States, Puerto
Rico and Guam as the Representatives may reasonably request and such
other jurisdictions as the Company, Aetna and the Representatives may
agree and to comply with such laws so as to permit the continuance of
sales and dealings therein in such jurisdictions for as long as may
be necessary to complete the distribution of such Designated
Preferred Securities, provided that in connection therewith the
Company and Aetna shall not be required to qualify as a foreign
corporation or to file a general consent to service of process in any
jurisdiction, and provided further that in connection therewith the
Company and Aetna shall not be required to qualify such Designated
Preferred Securities for offering and sale under the securities laws
of any such jurisdiction for a period in excess of nine months after
the initial time of issue of the Prospectus as amended or
supplemented relating to such Designated Preferred Securities;
(c) To furnish the Underwriters with copies of the
Prospectus as amended or supplemented in such quantities as the
Representatives may from time to time reasonably request, and, if the
delivery of a prospectus is required at any time in connection with
the offering or sale of the Designated Preferred Securities and if at
such time any event shall have occurred as a result of which the
Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of
the circumstances under which they were made when such Prospectus is
delivered, not misleading, or, if for any other reason it shall be
necessary during such same period to amend or supplement the
Prospectus in order to comply with the Act or the Exchange Act, to
notify the Representatives and to file such document and to prepare
and furnish without charge to each Underwriter and to any dealer in
securities as many copies as the Representatives may from time to
time reasonably request of any amended Prospectus or a supplement to
the Prospectus which will correct such statement or omission or
effect such compliance; provided, however, that in case any
Underwriter is required under the Act to deliver a prospectus in
connection with the offering or sale of the Designated Preferred
Securities at any time more than nine months after the date of the
Pricing Agreement relating to the Designated Preferred Securities,
the costs of such preparation and furnishing such amended or
supplemented Prospectus shall be borne by the Underwriters of such
Designated Preferred Securities;
(d) In the case of Aetna, to make generally available to
its securityholders as soon as practicable, but in any event not
later than eighteen months after the effective date of the
Registration Statement (as defined in Rule 158(c)), an earning
statement of Aetna and its subsidiaries (which need not be audited)
complying with Section 11(a) of the Act and the rules and regulations
of the Commission thereunder (including, at the option of Aetna, Rule
158);
(e) During the period beginning from the date of the
Pricing Agreement for such Designated Preferred Securities and
continuing to and including the First Time of Delivery for such
Designated Preferred Securities, not to offer, sell, contract to sell
or otherwise dispose of in the United States any preferred limited
liability company interests in the Company, which are substantially
similar to such Designated Preferred Securities, without the prior
written consent of the Representatives, which consent shall not be
unreasonably withheld;
(f) To use its best efforts to list, subject to official
notice of issuance, the Designated Preferred Securities on The New
York Stock Exchange, Inc.; and
(g) In the event of any exchange of Designated
Preferred Stock for the Related Debentures, to use its best efforts
to list the Related Debentures on the same exchange as that on which
the Designated Preferred Securities were listed immediately prior to
such exchange.
6. Each of the Company and Aetna, jointly and severally,
covenants and agrees with the several Underwriters that the Company and Aetna
will pay or cause to be paid the following: (i) the fees, disbursements and
expenses of the Company's and Aetna's counsel and accountants in connection
with the registration of the Preferred Securities under the Act and all other
expenses in connection with the Company's and Aetna's preparation, printing
and filing of the Registration Statement, any Preliminary Prospectus and,
subject to the proviso of Section 5(c), the Prospectus and amendments and
supplements thereto and the mailing and delivering of copies thereof to the
Underwriters and dealers; (ii) the cost of printing or otherwise producing any
Agreement among Underwriters, this Agreement, any Pricing Agreement, any Blue
Sky and Legal Investment Memoranda and any other documents in connection with
the offering, purchase, sale and delivery of the Designated Preferred
Securities; (iii) all expenses in connection with the qualification of the
Designated Preferred Securities for offering and sale under state securities
laws as provided in Section 5(b) hereof, including the reasonable fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky and legal investment
surveys; (iv) any fees charged by securities rating services for rating the
Designated Preferred Securities; (v) any filing fees incident to any required
review by the National Association of Securities Dealers, Inc. of the terms of
the sale of the Designated Preferred Securities; (vi) any cost of preparing
certificates representing the Designated Preferred Securities; (vii) the cost
and charges of any transfer agent or registrar or dividend disbursing agent;
(viii) the fees and expenses of any Trustee and any agent of any Trustee and
the fees and disbursements of counsel for any Trustee in connection with any
Indenture and the Debentures; and (ix) all other costs and expenses incident
to the performance of each of the Company's and Aetna's obligations hereunder
and under any Over-allotment Option which are not otherwise specifically
provided for in this Section. It is understood, however, that, except as
provided in this Section, Section 8 and Section 11 hereof, the Underwriters
will pay all of their own costs and expenses, including the fees of their
counsel, transfer taxes on resale of any of the Designated Preferred
Securities by them, and any advertising expenses connected with any offers
they may make.
The foregoing provisions of this Section 6 shall be without
prejudice to each of the Company's and Aetna's rights under any separate
agreements between the Company and Aetna and their attorneys, accountants and
vendors with respect to such fees, disbursements, expenses and costs.
7. The obligations of the Underwriters of any Designated
Preferred Securities under the Pricing Agreement relating to such Designated
Preferred Securities shall be subject, in the discretion of the
Representatives, to the condition that all representations and warranties and
other statements of each of the Company and Aetna in or incorporated by
reference in the Pricing Agreement relating to such Designated Preferred
Securities are, at and as of the respective Time of Delivery for such
Designated Preferred Securities, true and correct, the condition that each of
the Company and Aetna shall have performed in all material respects all of its
obligations hereunder theretofore to be performed, and the following additional
conditions:
(a) The Prospectus as amended or supplemented in
relation to the applicable Designated Preferred Securities shall have
been filed with the Commission pursuant to Rule 424(b) within the
applicable time period prescribed for such filing by the rules and
regulations under the Act and in accordance with Section 5(a) hereof;
no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or, to the
knowledge of the Company or Aetna, threatened by the Commission;
(b) Sullivan & Cromwell, counsel for the Underwriters,
shall have furnished to the Representatives such opinion or opinions,
dated the respective Time of Delivery for such Designated Preferred
Securities, with respect to the incorporation of Aetna and the
Company, the Guarantee Agreement, the Expense Agreement, the
Indenture, the Registration Statement, the Prospectus as amended or
supplemented, the Investment Company Act of 1940, as amended, the
validity of such Designated Preferred Securities and the Related
Debentures and other related matters as the Representatives may
reasonably request, and such counsel shall have received such papers
and information as they may reasonably request to enable them to pass
upon such matters;
(c) Zoe Baird, Senior Vice President and General Counsel
of Aetna, shall have furnished to the Representatives her written
opinion, dated the respective Time of Delivery for such Designated
Preferred Securities, in form and substance satisfactory to the
Representatives, to the effect that:
(i) Aetna has been duly incorporated and is
validly existing as an insurance corporation in good standing
under the laws of the State of Connecticut;
(ii) To the best of such counsel's knowledge, Aetna
is qualified to do business, and is in good standing, as a
foreign insurance corporation under the laws of the
Commonwealth of Pennsylvania and the District of Columbia or, if
not so qualified and in good standing in either such
jurisdiction, such failure to be so qualified and in good
standing, as of the date of such opinion, will not have a
material adverse effect on the financial condition of Aetna and
its subsidiaries taken as a whole;
(iii) Each of Aetna Life Insurance Company and The
Aetna Casualty and Surety Company has been duly incorporated
and is validly existing as an insurance corporation in good
standing under the laws of the State of Connecticut; all of the
outstanding shares of capital stock of Aetna Life Insurance
Company are owned directly by the Company; and all of the
outstanding shares of capital stock of The Aetna Casualty and
Surety Company have been duly authorized and validly issued and
are fully paid and non-assessable, and are owned directly or
indirectly by Aetna;
(iv) To the best of such counsel's knowledge and
other than as set forth or contemplated in the Prospectus,
there are no legal or governmental proceedings pending or
threatened involving Aetna or any of its subsidiaries of a
character required to be disclosed in the Registration
Statement or Prospectus which are not adequately disclosed in
the Registration Statement or Prospectus;
(v) All of the issued Common Securities of the
Company and all of the capital stock of Aetna Capital are owned
directly or indirectly by Aetna;
(vi) Aetna Capital has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of Connecticut;
(vii) This Agreement and the Pricing Agreement with
respect to the Designated Preferred Securities have been duly
authorized, executed and delivered by Aetna;
(viii) Each of the Guarantee Agreement and the Expense
Agreement has been duly authorized, executed and delivered by
Aetna and, in the case of the Expense Agreement, assuming the
due authorization, execution and delivery thereof by the
Company, constitutes a valid and legally binding agreement of
Aetna enforceable in accordance with its terms, subject to (1)
bankruptcy, insolvency, reorganization, fraudulent transfer,
moratorium and other similar laws now or hereafter in effect
relating to or affecting creditors' rights generally and the
rights of creditors of insurance companies generally and (2)
general principles of equity (regardless of whether considered
in a proceeding at law or in equity);
(ix) The Related Debentures have been duly
authorized by Aetna, and, when the Related Debentures are
issued, executed, authenticated, delivered and paid for by the
Company in accordance with the Indenture, such Related
Debentures will be duly issued, executed and delivered and will
constitute valid and legally binding obligations of Aetna
enforceable against Aetna in accordance with their terms,
subject to (1) bankruptcy, insolvency, reorganization,
fraudulent transfer, moratorium and other similar laws now or
hereafter in effect relating to or affecting creditors rights
generally and the rights of creditors of insurance companies
generally and (2) general principles of equity (regardless of
whether considered in a proceeding at law or in equity);
(x) The Indenture has been duly authorized,
executed and delivered by Aetna and, assuming the due
authorization, execution and delivery thereof by the Trustee,
the Indenture constitutes a valid and legally binding instrument
of Aetna enforceable against Aetna in accordance with its
terms, subject to (1) bankruptcy, insolvency, reorganization,
fraudulent transfer, moratorium and other similar laws now or
hereafter in effect relating to or affecting creditors' rights
generally, and the rights of creditors of insurance companies
generally and (2) general principles of equity (regardless of
whether considered in a proceeding at law or in equity); and
the Indenture has been duly qualified under the Trust Indenture
Act;
(xi) The issue and sale of the Designated Preferred
Securities being delivered at such Time of Delivery and the
issuance of the Related Debentures and the performance by Aetna
of its obligations under the Indenture, the Related Debentures,
the Guarantee Agreement, the Expense Agreement, this Agreement,
and the Pricing Agreement with respect to the Designated
Preferred Securities will not (1) conflict with or result in
a breach or violation by Aetna of any of the terms or
provisions of, or constitute a default by Aetna under, any
indenture, mortgage, deed of trust, loan agreement or other
similar agreement or instrument known to such counsel to which
Aetna is a party or by which Aetna is bound or to which any of
the property or assets of Aetna is subject, except, in all such
cases, for such conflicts, breaches, violations or defaults as
would neither have a material adverse effect on the financial
condition of Aetna and its subsidiaries taken as a whole nor
have a material adverse effect on the issuance or sale of the
Designated Preferred Securities, and (2) result in any
violation of (A) the provisions of the Certificate of
Incorporation or By-Laws of Aetna or (B) any statute of the
United States or the State of Connecticut or any order, rule or
regulation known to such counsel of any court or governmental
agency or body of the United States or the State of Connecticut
having jurisdiction over Aetna or any of its properties, except
with respect to clause (B) of this Paragraph (xi)(2), such
violations as would neither have a material adverse effect on
the financial condition of Aetna and its subsidiaries taken as
a whole nor have a material adverse effect on the issuance or
sale of the Designated Preferred Securities (and except that
for purposes of this paragraph (xi) such counsel need not
express any opinion as to (1) any violation of any fraudulent
transfer laws or other antifraud laws or as to any violation of
any federal or state securities laws or blue sky or insurance
laws or (2) any transactions of the type described in the
Prospectus under the caption "ERISA Matters"; provided further,
that insofar as performance by Aetna of its obligations under
the Indenture, the Related Debentures, the Guarantee Agreement,
the Expense Agreement, this Agreement and the Pricing Agreement
relating to the Designated Preferred Securities is concerned,
such counsel need not express any opinion as to bankruptcy,
insolvency, reorganization, moratorium and other similar laws
now or hereafter in effect relating to or affecting creditors'
rights generally and the rights of creditors of insurance
companies generally);
(xii) The documents incorporated by reference in the
Prospectus as amended or supplemented (other than the financial
statements and related notes, information as to reserves, the
financial statement schedules and the other financial and
statistical data included therein or omitted therefrom, as to
which such counsel need express no opinion), when they became
effective or were filed with the Commission, as the case may
be, complied as to form in all material respects with the
requirements of the Act or the Exchange Act, as applicable, and
the rules and regulations of the Commission thereunder; and
(xiii) Under the laws of the State of Connecticut and
under the federal laws of the United States, no consent,
approval, authorization, order, registration, filing or
qualification of or with any court or governmental agency or
body is required for the issue and sale of the Designated
Preferred Securities being delivered at such Time of Delivery
in accordance with this Agreement or the Pricing Agreement
relating to the Designated Preferred Securities or the issuance
of the Related Debentures, except for such consents, approvals,
authorizations, orders, registrations, filings or
qualifications as have been obtained under the Act or the Trust
Indenture Act or from the Connecticut Insurance Commissioner
and such consents, approvals, authorizations, orders,
registrations, filings or qualifications as may be required
under state securities or Blue Sky laws or insurance securities
laws of any such jurisdiction in connection with the purchase
and sale and distribution of the Designated Preferred
Securities by the Underwriters or the issuance of the Related
Debentures, and except those which, if not obtained, will have
neither a material adverse effect on the financial condition of
Aetna and its subsidiaries taken as a whole nor a material
adverse effect on the issuance or sale of the Designated
Preferred Securities.
In addition, such counsel shall state that such counsel does
not know of any contract or other document (i) of a character required to be
filed as an exhibit to any of the documents incorporated by reference into the
Prospectus as amended or supplemented which is not so filed, (ii) required to
be incorporated by reference into the Prospectus as amended or supplemented
which is not so incorporated by reference or (iii) required to be described
in the Registration Statement or the Prospectus as amended or supplemented
which is not so described.
In rendering this opinion required by subsection (c) of this
Section, Ms. Baird may state that she is admitted to the Bar of the State of
Connecticut and she does not express any opinion as to the laws of any other
jurisdiction other than the federal laws of the United States of America, Ms.
Baird may rely (A) as to any matter to which you consent (which consent shall
not be unreasonably withheld), to the extent specified in such opinion, upon
the opinions of other counsel in good standing whom such counsel believes to
be reliable, provided that Ms. Baird shall state that she and you are
justified in relying on such opinions and (B) as to matters of fact, upon
certificates of officers and representatives of Aetna and of public officials,
and may state that she has not verified independently the accuracy or
completeness of information or documents furnished to such counsel with
respect to the Registration Statement or the Prospectus.
(d) Davis Polk & Wardwell, special counsel for the
Company and Aetna, shall have furnished to the Representatives their
written opinion, dated the respective Time of Delivery for such
Designated Preferred Securities, in form and substance satisfactory
to the Representatives, to the effect that:
(i) The Company has been duly formed and is
validly existing as a limited liability company in good
standing under the laws of the State of Delaware;
(ii) The Designated Preferred Securities being
delivered at such Time of Delivery have been duly authorized
and validly issued and are fully paid and non-assessable
limited liability company interests in the Company, as to which
the Preferred Securityholders, in their capacity as members of
the Company, will have no liability solely by reason of being
Preferred Securityholders in excess of their obligations to
make payments as provided in the L.L.C. Agreement and their
share of the Company's assets and undistributed profits
(subject to any obligation of a Preferred Securityholder to
repay any funds wrongfully distributed to it); and the Preferred
Securities conform, in all material respects, to the
descriptions thereof contained in the Prospectus as amended or
supplemented with respect to such Designated Preferred
Securities;
(iii) The Common Securities issued to the Managing
Members have been duly authorized and are validly issued;
(iv) The L.L.C. Agreement constitutes a valid and
legally binding agreement of Aetna and Aetna Capital,
enforceable against Aetna and Aetna Capital by the Preferred
Securityholders in accordance with its terms, subject to (1)
bankruptcy, insolvency, reorganization, fraudulent transfer,
moratorium and other similar laws now or hereafter in effect
relating to or affecting creditors' rights generally, (2)
general principles of equity (regardless of whether considered
in a proceeding at law or in equity) and (3) applicable law
relating to fiduciary duties;
(v) This Agreement and the Pricing Agreement with
respect to such Designated Preferred Securities have been duly
authorized, executed and delivered by each of Aetna and the
Company;
(vi) Each of the Guarantee Agreement and the Expense
Agreement has been duly authorized, executed and delivered by
Aetna and, in the case of the Expense Agreement, the Company and
constitutes a valid and legally binding agreement of Aetna
enforceable against Aetna in accordance with its terms, subject
to (1) bankruptcy, insolvency, reorganization, fraudulent
transfer, moratorium and other laws now or hereafter in effect
relating to or affecting creditors' rights generally and the
rights of creditors of insurance companies generally and (2)
general principles of equity (regardless of whether considered
in a proceeding at law or in equity);
(vii) The Related Debentures have been duly
authorized by Aetna, and, when the Related Debentures are
issued, executed, authenticated, delivered and paid for by the
Company in accordance with the Indenture, such Related
Debentures will be duly issued, executed and delivered and will
constitute valid and legally binding obligations of Aetna
enforceable against Aetna in accordance with their terms,
subject to (1) bankruptcy, insolvency, reorganization,
fraudulent transfer, moratorium and other similar laws now or
hereafter in effect relating to or affecting creditors' rights
generally and the rights of creditors of insurance companies
generally and (2) general principles of equity (regardless of
whether considered in a proceeding at law or in equity);
(viii) The Indenture has been duly authorized,
executed and delivered by Aetna and, assuming the due
authorization, execution and, delivery thereof by the Trustee,
the Indenture constitutes a valid and legally binding instrument
of Aetna enforceable against Aetna in accordance with its
terms, subject to (1) bankruptcy, insolvency, reorganization,
fraudulent transfer, moratorium and other similar laws now or
hereafter in effect relating to or affecting creditors' rights
generally and the rights of creditors of insurance companies
generally and (2) general principles of equity (regardless of
whether considered in a proceeding at law or in equity); and
the Indenture has been duly qualified under the Trust Indenture
Act;
(ix) The issue and sale of the Designated Preferred
Securities being delivered at such Time of Delivery and the
performance by the Company of its obligations under this
Agreement and the Pricing Agreement with respect to the
Designated Preferred Securities will not (1) conflict with or
result in a breach or violation by the Company of any of the
terms or provisions of, or constitute a default by the Company
under, any indenture, mortgage, deed of trust, loan agreement
or other similar agreement or instrument known to such counsel
to which the Company is a party or by which the Company is
bound or to which any of the property or assets of the Company
is subject, except, in all such cases, for such conflicts,
breaches, violations or defaults as would neither have a
material adverse effect on the financial condition of the
Company nor have a material adverse effect on the issuance or
sale of the Designated Preferred Securities, and (2) result in
any violation of (A) the provisions of the Certificate of
Formation of the Company or the L.L.C. Agreement or (B) any
statute of the United States or the State of Delaware or any
order, rule or regulation known to such counsel of any court or
governmental agency or body of the United States or the State
of Delaware having jurisdiction over the Company or any of its
properties, except with respect to clause (B) of this Paragraph
(ix)(2), such violations as would neither have a material
adverse effect on the financial condition of the Company nor
have a material adverse effect on the issuance or sale of the
Designated Preferred Securities (and except that for purposes
of this paragraph (ix) such counsel need not express any
opinion as to (1) any violation of any fraudulent transfer laws
or other antifraud laws or (2) any transaction of the type
described in the Prospectus under the caption "ERISA Matters";
provided further, that insofar as performance by the Company of
its obligations under this Agreement and the Pricing Agreement
relating to the Designated Preferred Securities is concerned,
such counsel need not express any opinion as to bankruptcy,
insolvency, reorganization, moratorium and other similar laws
now or hereafter in effect relating to or affecting creditors'
rights generally);
(x) Under the laws of the States of Delaware and
New York, no consent, approval, authorization, order,
registration, filing or qualification of or with any court or
governmental agency or body is required for the issue and sale
of the Designated Preferred Securities being delivered at such
Time of Delivery in accordance with this Agreement or the
Pricing Agreement relating to the Designated Preferred
Securities being delivered at such Time of Delivery or the
issuance of the Related Debentures;
(xi) The Company is not an "investment company"
within the meaning of the Investment Company Act of 1940, as
amended and will not become an investment company as a result
of the use of the proceeds from the issuance of the Designated
Preferred Securities in the manner contemplated by the
Prospectus;
(xii) The statements contained in the Prospectus
under the captions "Description of the Preferred Securities,"
"Description of the Guarantee," "Description of the Debentures
and the Subordinated Indenture," "Taxation", and "Plan of
Distribution" and the corresponding sections in any prospectus
supplement relating to the description of the Designated
Preferred Securities or their distribution, insofar as such
statements constitute summaries of certain provisions of the
documents or U.S. tax laws referred to therein, accurately
summarize the material provisions of such documents or U.S. tax
laws required to be stated therein; and
(xiii) (1) such counsel is of the opinion that the
Registration Statement, as amended, and the Prospectus, as
amended or supplemented, as of such Time of Delivery for the
Designated Preferred Securities (other than the financial
statements and related notes, information as to reserves, the
financial statement schedules and the other financial data
included therein or omitted therefrom, as to which such counsel
need express no opinion), comply as to form in all material
respects with the Act and the Trust Indenture Act and the rules
and regulations of the Commission thereunder, (2) nothing has
come to the attention of such counsel that would cause such
counsel to believe that the Registration Statement as of its
effective date (other than the financial statements and related
notes, information as to reserves, the financial statement
schedules and the other financial data included therein or
omitted therefrom, as to which such counsel need express no
belief) contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading and
(3) nothing has come to the attention of such counsel that
would cause such counsel to believe that the Registration
Statement, as amended, or the Prospectus, as amended or
supplemented, as of the date of the Pricing Agreement with
respect to the Designated Preferred Securities and such Time
of Delivery for the Designated Preferred Securities (other than
the financial statements and related notes, information as to
reserves, the financial statement schedules and the other
financial data included therein or omitted therefrom, as to
which such counsel need express no belief), contained or
contains an untrue statement of a material fact or omitted or
omits to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they
were made, not misleading.
In addition, such counsel shall state that such counsel does
not know of any contract or other document of a character required to be filed
as an exhibit to the Registration Statement pursuant to the requirements of
Form S-3 under the Securities Act which is not so filed.
With respect to clause (xiii) of subsection (d) of this
Section, Davis Polk & Wardwell may state that their opinion and belief are
based upon their participation in the preparation of the Registration
Statement and Prospectus and any amendments or supplements thereto and review
and discussion of the contents thereof, but are without independent check or
verification except as specified. In rendering the opinion required by
subsection (d) of this Section, Davis Polk & Wardwell may rely upon the
accuracy of matters (A) involving the application of laws of any jurisdiction
other than the United States or New York and as to any other matter to which
you consent (which consent shall not be unreasonably withheld), to the extent
specified in such opinion, upon the opinions of other counsel reasonably
satisfactory to you (including without limitation, as to matters of
Connecticut law, on the opinion of Zoe Baird, Senior Vice President and
General Counsel of Aetna and as to matters of Delaware law, on the opinion of
Richards, Layton & Finger, P.A.), and (B) of fact upon certificates of
officers and representatives of the Company and Aetna and of public officials.
(e) On the date of the Pricing Agreement for such
Designated Preferred Securities and at the respective Time of
Delivery for such Designated Preferred Securities, KPMG Peat Marwick
shall have furnished to the Representatives a letter, dated the date
of the Pricing Agreement and a letter dated such Time of Delivery,
respectively, to the effect set forth in Annex II hereto, and with
respect to such letter dated such Time of Delivery, as to such other
matters as the Representatives may reasonably request and in form and
substance satisfactory to the Representatives;
(f) Since the respective dates as of which information
is given in the Prospectus as amended or supplemented as of the date
of the Pricing Agreement until the respective Time of Delivery of the
Designated Preferred Securities there shall not have been any adverse
change or a development involving a prospective material adverse
change in the financial position, stockholders' equity or results of
operations of Aetna and its subsidiaries considered as a whole,
otherwise than as set forth or contemplated in such Prospectus as
amended or supplemented, the effect of which, in any such case
described above, is in the reasonable judgment of the
Representatives, after consultation with the Company and Aetna, so
material and adverse as to make it impracticable to proceed with the
public offering or the delivery of the Designated Preferred
Securities on the terms and in the manner contemplated in such
Prospectus as amended or supplemented;
(g) On or after the date of the Pricing Agreement
relating to the Designated Preferred Securities until the respective
Time of Delivery of the Designated Preferred Securities, no
downgrading shall have occurred in the rating accorded Aetna's debt
securities or preferred stock by either the Standard & Poor's
Corporation or Moody's Investors Service, Inc.;
(h) On or after the date of the Pricing Agreement
relating to the Designated Preferred Securities until the respective
Time of Delivery of the Designated Preferred Securities, there shall
not have occurred any of the following: (i) a suspension or material
limitation in trading in securities generally on the New York Stock
Exchange; (ii) a general moratorium on commercial banking activities
in New York declared by either Federal or New York state authorities;
or (iii) the outbreak or material escalation of hostilities involving
the United States or the declaration by the United States of a
national emergency or war, if the effect of any of the above such
events, in the reasonable judgment of the Representatives, after
consultation with the Company and Aetna, makes it impracticable to
proceed with the public offering or the delivery of the Designated
Preferred Securities on the terms and in the manner contemplated by
the Prospectus as amended or supplemented;
(i) Aetna shall have furnished or caused to be furnished
to the Representatives at the respective Time of Delivery for the
Designated Preferred Securities a certificate or certificates of the
Group Executive - Finance and Administration or the Senior Vice
President - Finance or the Treasurer as to the accuracy of the
representations and warranties of the Company and Aetna herein at and
as of such Time of Delivery, as to the performance by the Company and
Aetna of all of their obligations hereunder to be performed at or
prior to such Time of Delivery, as to the matters set forth in
subsections (a) and (f) of this Section and as to such other matters
as the Representatives may reasonably request; and
(j) The Designated Preferred Securities to be sold by
the Company at such Time of Delivery shall have been duly listed,
subject to official notice of issuance, on the New York Stock
Exchange, Inc.
8. (a) Each of the Company and Aetna, jointly and
severally, will indemnify and hold harmless each Underwriter against
any losses, claims, damages or liabilities to which such Underwriter
may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any
Preliminary Prospectus, any preliminary prospectus supplement, the
Registration Statement, the Prospectus as amended or supplemented and
any other prospectus relating to the Designated Preferred Securities,
or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein (i) in the case of the Registration Statement, not misleading
and (ii) in the case of any Prospectus, in light of the circumstances
in which they were made, not misleading, and will reimburse each
Underwriter for any legal or other expenses reasonably incurred by
such Underwriter in connection with investigating or defending any
such action or claim as such expenses are incurred; provided,
however, that neither the Company nor Aetna shall be liable in any
such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in any
Preliminary Prospectus, any preliminary prospectus supplement, the
Registration Statement, the Prospectus as amended or supplemented and
any other prospectus relating to the Designated Preferred Securities,
or any such amendment or supplement, in reliance upon and in
conformity with written information furnished to the Company or Aetna
by any Underwriter of Designated Preferred Securities through the
Representatives for inclusion therein; and provided, further, that
neither the Company nor Aetna shall be liable to any Underwriter
under the indemnity agreement in this subsection (a) with respect to
any Preliminary Prospectus or any preliminary prospectus supplement
to the extent that any such loss, claim, damage or liability of such
Underwriter results from the fact such Underwriter sold Designated
Preferred Securities to a person to whom there was not sent or given,
at or prior to the written confirmation of such sale, a copy of the
Prospectus (excluding documents incorporated by reference) or of the
Prospectus as then amended or supplemented (excluding documents
incorporated by reference) in any case where such delivery is
required by the Act if the Company or Aetna has previously furnished
copies thereof to such Underwriter (or to the Representatives) and
the loss, claim, damage or liability of such Underwriter results from
an untrue or alleged untrue statement or omission or alleged omission
of a material fact contained in the Preliminary Prospectus or any
preliminary prospectus supplement which was corrected in the
Prospectus (or the Prospectus as amended or supplemented at the time
of such confirmation).
(b) Each Underwriter will indemnify and hold harmless
the Company and Aetna against any losses, claims, damages or
liabilities to which the Company or Aetna may become subject, under
the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as
amended or supplemented and any other prospectus relating to the
Designated Preferred Securities, or any amendment or supplement
thereto, or arise out or are based upon the omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein (i) in the case
of the Registration Statement, not misleading and (ii) in the case of
any Prospectus, in light of the circumstances under which they were
made, not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in any Preliminary Prospectus,
any preliminary prospectus supplement, the Registration Statement,
the Prospectus as amended or supplemented and any other prospectus
relating to the Designated Preferred Securities, or any such
amendment or supplement, in reliance upon and in conformity with
written information furnished to the Company or Aetna by such
Underwriter through the Representatives for inclusion therein; and
will reimburse the Company and Aetna for any legal or other expenses
reasonably incurred by the Company or Aetna in connection with
investigating or defending any such action or claim as such expenses
are incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any
action, such indemnified party shall, if a claim in respect thereof
is to be made against the indemnifying party under such subsection,
notify the indemnifying party in writing of the commencement thereof;
but the omission so to notify the indemnifying party shall not
relieve it from any liability which it may have to any indemnified
party otherwise than under such subsection. In case any such action
shall be brought against any indemnified party and it shall notify
the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that
it shall wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof,
the indemnifying party shall not be liable to such indemnified party
under such subsection for any legal expenses of other counsel or any
other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than
reasonable costs of investigation. In no event shall any
indemnifying party be liable for the fees and expenses of more than
one counsel (in addition to local counsel) separate from their own
counsel for all indemnified parties in connection with any one action
or separate but similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances. In no
event shall an indemnifying party be liable with respect to any action
or claim settled without its written consent. No indemnifying party
shall, without the prior written consent of the indemnified party,
effect any settlement of any pending or threatened proceeding in
respect of which any indemnified party is or could have been a party
and indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the
subject matter of such proceeding.
(d) If the indemnification provided for in this Section
8 is unavailable to or insufficient to hold harmless an indemnified
party under subsection (a) or (b) above in respect of any losses,
claims, damages or liabilities (or actions in respect thereof)
referred to therein, then each indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative benefits
received by the Company and Aetna on the one hand and the
Underwriters of the Designated Preferred Securities on the other from
the offering of the Designated Preferred Securities to which such
loss, claim, damage or liability (or action in respect thereof)
relates. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the
indemnified party is not entitled to receive the indemnification
provided for in subsection (a) above because of the second proviso
thereof or if the indemnified party failed to give the notice
required under subsection (c) above, then each indemnifying party
shall contribute to such amount paid or payable by such indemnified
party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company and
Aetna on the one hand and the Underwriters of the Designated
Preferred Securities on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other
relevant equitable considerations. The relative benefits received by
the Company and Aetna on the one hand and such Underwriters on the
other shall be deemed to be in the same proportion as the total
proceeds from such offering (before deducting expenses) received by
the Company less the total underwriting compensation paid by Aetna
bear to the total underwriting compensation received by such
Underwriters. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of
a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company and
Aetna on the one hand or such Underwriters on the other and the
parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission,
including with respect to any Underwriter, the extent to which such
losses, claims, damages or liabilities (or actions in respect thereof)
with respect to any Preliminary Prospectus or any preliminary
prospectus supplement result from the fact that the Underwriter sold
Designated Preferred Securities to a person to whom there was not
sent or given, at or prior to the written confirmation of such sale,
a copy of the Prospectus (excluding documents incorporated by
reference) or of the Prospectus as then amended or supplemented
(excluding documents incorporated by reference), if the Company or
Aetna have previously furnished copies thereof to such Underwriters.
The Company, Aetna and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this subsection (d)
were determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations
referred to above in this subsection (d). The amount paid or payable
by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in this
subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding
the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which
the total price at which the applicable Designated Preferred
Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages (other than
amounts paid or incurred without the consent of the indemnifying
party as provided in this Section 8) which such Underwriter has
otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The obligations of
the Underwriters of Designated Preferred Securities in this
subsection (d) to contribute are several in proportion to their
respective underwriting obligations with respect to such Designated
Preferred Securities and not joint. No indemnifying party will be
liable for contribution with respect to any action or claim settled
without its written consent.
(e) The obligations of the Company and Aetna under this
Section 8 shall be in addition to any liability which the Company and
Aetna may otherwise have and shall extend or not extend, as the case
may be, upon the same terms and conditions, to each person, if any,
who controls any Underwriter within the meaning of the Act; and the
obligations of the Underwriters under this Section 8 shall be in
addition to any liability which the respective Underwriters may
otherwise have and shall extend or not extend, as the case may be,
upon the same terms and conditions, to each officer and director of
Aetna and the Company and to each person, if any, who controls Aetna
or the Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its
obligation to purchase the Firm Designated Preferred Securities or
Optional Designated Preferred Securities which it has agreed to
purchase under the Pricing Agreement relating to such Preferred
Securities, the Representatives may in their discretion arrange for
themselves or another party or other parties to purchase such
Preferred Securities on the terms contained herein. If within
thirty-six hours after such default by any Underwriter the
Representatives do not arrange for the purchase of such Firm
Designated Preferred Securities or Optional Designated Preferred
Securities, as the case may be, then the Company and Aetna shall be
entitled to a further period of thirty-six hours within which to
procure another party or other parties reasonably satisfactory to the
Representatives to purchase such Preferred Securities on such terms.
In the event that, within the respective prescribed period, the
Representatives notify the Company and Aetna that they have so
arranged for the purchase of such Preferred Securities, or the
Company or Aetna notifies the Representatives that it has so arranged
for the purchase of such Preferred Securities, the Representatives,
Aetna or the Company shall have the right to postpone the Time of
Delivery for such Preferred Securities for a period of not more than
seven days in order to effect whatever changes may thereby be made
necessary in the Registration Statement or the Prospectus as amended
or supplemented, or in any other documents or arrangements, and the
Company and Aetna agree to file promptly any amendments or
supplements to the Registration Statement or the Prospectus which in
the opinion of the Representatives may thereby be made necessary. The
term "Underwriter" as used in this Agreement shall include any person
substituted under this Section with like effect as if such person had
originally been a party to the Pricing Agreement with respect to such
Designated Preferred Securities.
(b) If, after giving effect to any arrangements for the
purchase of the Firm Designated Preferred Securities or Optional
Designated Preferred Securities, as the case may be, of a defaulting
Underwriter or Underwriters by the Representatives, the Company or
Aetna as provided in subsection (a) above, the aggregate amount of
Designated Preferred Securities which remains unpurchased does not
exceed one-tenth of the aggregate number of Firm Designated Preferred
Securities or Optional Designated Preferred Securities, as the case
may be, to be purchased at the respective Time of Delivery, then the
Company and Aetna shall have the right to require each non-defaulting
Underwriter to purchase the number of Firm Designated Preferred
Securities or Optional Designated Preferred Securities, as the case
may be, which such Underwriter agreed to purchase under the Pricing
Agreement relating to such Designated Preferred Securities and, in
addition, to require each non-defaulting Underwriter to purchase its
pro rata share (based on the number of Firm Designated Preferred
Securities or Optional Designated Preferred Securities, as the case
may be, which such Underwriter agreed to purchase under such Pricing
Agreement) of the Firm Designated Preferred Securities or the Optional
Designated Preferred Securities, as the case may be, of such
defaulting Underwriter or Underwriters for which such arrangements
have not been made; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the
purchase of the Firm Designated Preferred Securities or the Optional
Designated Preferred Securities, as the case may be, of a defaulting
Underwriter or Underwriters by the Representatives, Aetna or the
Company as provided in subsection (a) above, the aggregate number of
Firm Designated Preferred Securities or the Optional Designated
Preferred Securities, as the case may be, which remains unpurchased
exceeds one-tenth of the aggregate number of Firm Designated
Preferred Securities or Optional Designated Preferred Securities, as
the case may be, to be purchased at the respective Time of Delivery,
as referred to in subsection (b) above, or if the Company or Aetna
shall not exercise the right described in subsection (b) above to
require non-defaulting Underwriters to purchase Firm Designated
Preferred Securities or Optional Designated Preferred Securities, as
the case may be, of a defaulting Underwriter or Underwriters, then
the Pricing Agreement relating to such Firm Designated Preferred
Securities or Over-allotment Option relating to such Optional
Designated Preferred Securities, as the case may be, shall thereupon
terminate, without liability on the part of any non-defaulting
Underwriter, Aetna or the Company, except for the expenses to be
borne by the Company, Aetna and the Underwriters as provided in
Section 6 hereof and the indemnity and contribution agreements in
Section 8 hereof; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
10. The respective indemnities, agreements, representations,
warranties and other statements of the Company and Aetna and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and
effect, regardless of any investigation (or any statement as to the results
thereof) made by or on behalf of any Underwriter or any controlling person of
any Underwriter, or the Company or Aetna, or any officer or director or
controlling person of the Company or Aetna, and shall survive delivery of and
payment for the Designated Preferred Securities.
11. If any Pricing Agreement or Over-allotment Option shall be
terminated pursuant to Section 9 hereof, neither Aetna nor the Company shall
then be under any liability to any Underwriter with respect to the Firm
Designated Preferred Securities or Optional Designated Preferred Securities
with respect to which such Pricing Agreement shall have been terminated except
as provided in Section 6 and Section 8 hereof; but, if for any other reason
Designated Preferred Securities are not delivered by or on behalf of the
Company and Aetna as provided herein, the Company and Aetna will reimburse the
Underwriters through the Representatives for all reasonable out-of-pocket
expenses approved in writing by the Representatives, including reasonable fees
and disbursements of counsel, reasonably incurred by the Underwriters in making
preparations for the purchase, sale and delivery of such Designated Preferred
Securities, but neither Aetna nor the Company shall then be under further
liability to any Underwriter with respect to such Designated Preferred
Securities, except as provided in Section 6 and Section 8 hereof.
12. In all dealings hereunder, the Representatives of the
Underwriters of Designated Preferred Securities shall act on behalf of each of
such Underwriters, and the parties hereto shall be entitled to act and rely
upon any statement, request, notice or agreement on behalf of any Underwriter
made or given by such Representatives jointly or by such of the
Representatives, if any, as may be designated for such purpose in the Pricing
Agreement.
All statements, requests, notices and agreements hereunder
shall be in writing, and if to the Underwriters shall be delivered or sent by
mail, telex or facsimile transmission to the address of the Representatives as
set forth in the Pricing Agreement; and if to the Company or Aetna shall be
delivered or sent by mail, telex or facsimile transmission to the address of
the Company and Aetna set forth in the Registration Statement; Attention:
Corporate Secretary; provided, however, that any notice to an Underwriter
pursuant to Section 8(c) hereof shall be delivered or sent by mail, telex or
facsimile transmission to such Underwriter at its address set forth in its
Underwriters' Questionnaire, or telex constituting such Questionnaire, which
address will be supplied to the Company and Aetna by the Representatives upon
request. Any such statements, requests, notices or agreements shall take
effect upon receipt thereof.
13. This Agreement and each Pricing Agreement shall be binding
upon, and inure solely to the benefit of, the Underwriters, the Company and
Aetna and, to the extent provided in Section 8 and Section 10 hereof, the
officers and directors of the Company and Aetna and each person who controls
the Company and Aetna or any Underwriter, and their respective heirs,
executors, administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement or any such
Pricing Agreement. No purchaser of any of the Preferred Securities from any
Underwriter shall be deemed a successor or assign by reason merely of such
purchase.
14. Time shall be of the essence for each Pricing Agreement.
As used herein, "business day" shall mean any day when the Commission's office
in Washington, D.C. is open for business.
15. This Agreement and each Pricing Agreement shall be
governed by and construed in accordance with the internal laws (and not the
conflict of law provisions) of the State of New York.
16. This Agreement and each Pricing Agreement may be executed
by any one or more of the parties hereto and thereto in any number of
counterparts, each of which shall be deemed to be an original, but all such
respective counterparts shall together constitute one and the same instrument.
Very truly yours,
AETNA CAPITAL L.L.C.
By: Aetna Life and Casualty Company,
as Managing Member
By: ______________________________
Name:
Title:
AETNA LIFE AND CASUALTY COMPANY
By: ______________________________
Name:
Title:
PRICING AGREEMENT
Goldman, Sachs & Co.
CS First Boston Corporation
Dean Witter Reynolds Inc.
A.G. Edwards & Sons, Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Morgan Stanley & Co. Incorporated
PaineWebber Incorporated
Smith Barney Inc.
As Representatives
of the several
Underwriters named in Schedule I hereto,
c/o Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
November 15, 1994
Ladies and Gentlemen:
Aetna Capital L.L.C., a limited liability company formed under
the laws of Delaware (the "Company"), proposes, subject to the terms and
conditions stated herein and in the Underwriting Agreement, dated November 15,
1994 (the "Underwriting Agreement"), to issue and sell to the Underwriters
named in Schedule I hereto (the "Underwriters") the Preferred Securities
specified in Schedule II hereto (the "Designated Preferred Securities"
consisting of Firm Designated Preferred Securities and any Optional Designated
Preferred Securities the Underwriters may elect to purchase), guaranteed by
Aetna Life and Casualty Company, a Connecticut insurance corporation
("Aetna"), to the extent set forth in the Prospectus and Registration Statement
relating to the Preferred Securities. Each of the provisions of the
Underwriting Agreement is incorporated herein by reference in its entirety,
and shall be deemed to be a part of this Agreement to the same extent as if
such provisions had been set forth in full herein; and each of the
representations and warranties set forth therein shall be deemed to have been
made at and as of the date of this Pricing Agreement, except that each
representation and warranty that refers to the Prospectus in Section 2 of the
Underwriting Agreement shall be deemed to be a representation or warranty as
of the date of the Underwriting Agreement in relation to the Prospectus (as
therein defined), and also a representation and warranty as of the date of
this Pricing Agreement in relation to the Prospectus as amended or
supplemented relating to the Designated Preferred Securities which are the
subject of this Pricing Agreement. Each reference to the Representatives
herein and in the provisions of the Underwriting Agreement so incorporated by
reference shall be deemed to refer to you. Unless otherwise defined herein,
terms defined in the Underwriting Agreement are used herein as therein
defined. The Representatives designated to act on behalf of each of the
Underwriters of the Designated Preferred Securities pursuant to Section 12 of
the Underwriting Agreement and the address of the Representatives referred to
in such Section 12 are set forth at the end of Schedule II hereto.
An amendment to the Registration Statement, or a supplement to
the Prospectus, as the case may be, relating to the Designated Preferred
Securities, in the form heretofore delivered to you is now proposed to be
filed with the Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, (a) the Company
agrees to issue and to sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company,
at the time and place and at the purchase price to the Underwriters set forth
in Schedule II hereto, the number of Firm Designated Preferred Securities set
forth opposite the name of such Underwriter in Schedule I hereto and, (b) in
the event and to the extent that the Underwriters shall exercise the election
to purchase Optional Designated Preferred Securities, as provided below, the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company
at the purchase price to the Underwriters set out in Schedule II hereto that
portion of the number of Optional Designated Preferred Securities as to which
such election shall have been exercised.
The Company hereby grants to each of the Underwriters the right
to purchase at their election up to the number of Optional Designated
Preferred Securities set forth opposite the name of such Underwriter in
Schedule I hereto on the terms referred to in the paragraph above for the sole
purpose of covering over-allotments in the sale of the Firm Designated
Preferred Securities. Any such election to purchase Optional Designated
Preferred Securities may be exercised by written notice from the
Representatives to the Company and Aetna given within a period of 30 calendar
days after the date of this Pricing Agreement, setting forth the aggregate
number of Optional Designated Preferred Securities to be purchased and the
date on which such Optional Designated Preferred Securities are to be
delivered, as determined by the Representatives which date (i) shall not be a
dividend payment date with respect to the Designated Preferred Securities and
(ii) shall not be earlier than the First Time of Delivery or, unless the
Representatives, Aetna and the Company otherwise agree in writing, shall not be
earlier than two nor later than ten business days after the date of such
notice.
If the foregoing is in accordance with your understanding,
please sign and return to us counterparts hereof, and upon acceptance hereof
by you, on behalf of each of the Underwriters, this letter and such acceptance
hereof, including the provisions of the Underwriting Agreement incorporated
herein by reference, shall constitute a binding agreement between each of the
Underwriters, the Company and Aetna. It is understood that your acceptance of
this letter on behalf of each of the Underwriters is or will be pursuant to
the authority set forth in a form of Agreement among Underwriters.
AETNA CAPITAL L.L.C.
By: Aetna Life and Casualty
Company, as Managing Member
By: ____________________________
Name:
Title:
AETNA LIFE AND CASUALTY COMPANY
By: ______________________________
Name:
Title:
Accepted as of the
date hereof:
Goldman, Sachs & Co.
CS First Boston Corporation
Dean Witter Reynolds Inc.
A.G. Edwards & Sons, Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Morgan Stanley & Co. Incorporated
PaineWebber Incorporated
Smith Barney Inc.
On behalf of each of
the Underwriters
By: Goldman, Sachs & Co.
By: ______________________________
(Goldman, Sachs & Co.)
SCHEDULE I
Maximum Number of
Number of Firm Optional
Designated Designated
Preferred Preferred
Securities Securities Which
Underwriter to be Purchased May be Purchased
- - ---------------------------------- ----------------- ------------------
Goldman, Sachs & Co. 900,000 135,004
CS First Boston Corporation 900,000 135,000
Dean Witter Reynolds Inc. 900,000 135,000
A.G. Edwards & Sons, Inc. 900,000 135,000
Merrill Lynch, Pierce, Fenner
& Smith Incorporated 900,000 135,000
Morgan Stanley & Co. Incorporated 900,000 135,000
PaineWebber Incorporated 900,000 135,000
Smith Barney Inc. 900,000 135,000
Advest, Inc. 50,000 7,500
Bear Stearns, & Co. Inc. 93,750 14,062
J.C. Bradford & Co. 50,000 7,500
Alex. Brown & Sons Incorporated 93,750 14,062
JW Charles Securities, Inc. 50,000 7,500
Commerzbank Capital Markets
Corporation 50,000 7,500
Cowen & Company 50,000 7,500
Craigie Incorporated 50,000 7,500
Credit Lyonnais Securities (USA)
Inc. 50,000 7,500
Crowell, Weedon & Co. 50,000 7,500
Dain Bosworth Incorporated 50,000 7,500
Dillon, Read & Co. Inc. 93,750 14,062
Donaldson, Lufkin & Jenrette
Securities Corporation 93,750 14,062
Fahnestock & Co. Inc. 50,000 7,500
First Albany Corporation 50,000 7,500
First of Michigan Corporation 50,000 7,500
Furman Selz Incorporated 50,000 7,500
Gruntal & Co., Incorporated 50,000 7,500
J.J.B. Hilliard, W.L. Lyons, Inc. 50,000 7,500
Interstate/Johnson Lane
Corporation 50,000 7,500
Janney Montgomery Scott Inc. 50,000 7,500
Josephthal Lyon & Ross
Incorporated 50,000 7,500
Kemper Securities, Inc. 93,750 14,062
Kennedy, Cabot & Co. 50,000 7,500
Kirkpatrick, Pettis, Smith,
Polian Inc. 50,000 7,500
Legg Mason Wood Walker
Incorporated 50,000 7,500
McDonald & Company Securities,
Inc. 50,000 7,500
McGinn, Smith & Co., Inc. 50,000 7,500
Morgan Keegan & Company,
Inc. 50,000 7,500
The Ohio Company 50,000 7,500
Olde Discount Corporation 50,000 7,500
Oppenheimer & Co., Inc. 93,750 14,062
Piper Jaffray Inc. 50,000 7,500
Principal Financial Securities,
Inc. 50,000 7,500
Prudential Securities
Incorporated 93,750 14,062
Pryor, McClendon, Counts & Co.,
Inc. 50,000 7,500
Rauscher Pierce Refsnes, Inc. 50,000 7,500
Raymond James & Associates, Inc. 50,000 7,500
The Robinson-Humphrey Company,
Inc. 50,000 7,500
Roney & Co. 50,000 7,500
Salomon Brothers Inc 93,750 14,062
Stifel, Nicolaus & Company,
Incorporated 50,000 7,500
Sutro & Co. Incorporated 50,000 7,500
Tucker Anthony Incorporated 50,000 7,500
U.S. Clearing Corp. 50,000 7,500
Van Kasper & Company 50,000 7,500
Wedbush Morgan Securities 50,000 7,500
Wheat, First Securities, Inc. 50,000 7,500
Yamaichi International
(America), Inc. 50,000 7,500
----------------- ------------------
Total 10,000,000 1,500,000
================= ==================
SCHEDULE II
Title of Designated Preferred Securities: 9.5% Cumulative Monthly Income
Preferred Securities, Series A
Number of Designated Preferred Securities:
Number of Firm Designated Preferred Securities:
10 million
Maximum Number of Optional Designated Preferred Securities:
1.5 million
Initial Offering Price to Public: $25.00 per security
Purchase Price by Underwriters (including the Optional Designated Preferred
Securities):
$25.00 per security, plus accrued dividends, if any, (i) from the
date of original issuance of the Firm Designated Preferred
Securities, if such security is purchased on or before the first date
on which dividends are paid by the Company and (ii) from such
dividend payment date, if such security is purchased after such
dividend payment date
Underwriters' Compensation: $.7875 per security
Specified Funds for Payment of Purchase Price and Underwriters' Compensation:
New York Clearing House Funds
Dividend Rate: 9.5% per annum
Liquidation Preference: $25.00 per security
Redemption and Exchange Provisions:
The Designated Preferred Securities may be redeemed, in whole
or in part at the option of the Company and subject to Aetna's consent on or
after November 30, 1999, upon not less than 30 nor more than 60 days' notice,
at $25.00 per security, plus accumulated and unpaid dividends (whether or not
declared) to the date fixed for redemption.
In addition, the Designated Preferred Securities may be
redeemed or exchanged upon the terms and conditions described in the
Prospectus under the caption "Description of the Preferred Securities --
Redemption or Exchange".
Other Terms of Designated Preferred Securities:
The Designated Preferred Securities shall have the voting
rights, dividend rights (including dividend payment dates) and rights upon
liquidation as are described in the Prospectus under the caption "Description
of the Preferred Securities".
Title of Related Debentures: 9.5% Series A Debentures due 2024
Interest Rate: 9.5% per annum
Maturity Date: November 22, 2024
The entire principal amount of the Related Debentures will
become due and payable, together with any accrued and unpaid interest thereon,
including Additional Interest, if any, on the earlier of (a) November 22, 2024
(subject to Aetna's right to exchange the Related Debentures for new
Debentures or reborrow the proceeds from the repayment of the Related
Debentures by issuing new Debentures upon the terms and subject to the
conditions set forth in the Prospectus under the caption "Description of the
Preferred Securities -- Redemption or Exchange" which new Debentures, in
either case, will become due and payable no later than November 22, 2043) and
(b) the date upon which the Company is dissolved; provided that, in the event
that the Designated Preferred Securities are exchanged for the Related
Debentures, the Related Debentures will mature on the date set forth in clause
(a), whether or not the Company shall have dissolved in connection with such
exchange.
Redemption and Prepayment Provisions:
The Related Debentures may be redeemed at the option of Aetna,
without premium or penalty, in whole or in part (together with accrued but
unpaid interest, including Additional Interest, if any, on the portion being
redeemed) on or after November 30, 1999, upon not less than 30 nor more than
60 days' notice.
In addition, the Related Debentures may be redeemed and will be
prepaid upon the terms and conditions described in the Prospectus under the
captions "Description of the Debentures and the Subordinated Indenture --
Mandatory Prepayment" and "-- Optional Redemption".
First Time of Delivery: November 22, 1994
Closing Location: Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Names and addresses of Representatives:
Designated Representatives: Goldman, Sachs & Co., CS
First Boston Corporation, Dean Witter Reynolds Inc., A.G.
Edwards & Sons, Inc., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Morgan Stanley & Co. Incorporated, PaineWebber
Incorporated and Smith Barney Inc.
Address for Notices, etc.: c/o Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
ANNEX II
Pursuant to Section 7(e) of the Underwriting Agreement, the
accountants shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public
accountants with respect to Aetna and its subsidiaries within
the meaning of the Act and the applicable published rules and
regulations thereunder;
(ii) In their opinion, the financial statements and
any supplementary financial information and schedules audited
by them and included or incorporated by reference in the
Registration Statement or the Prospectus comply as to form in
all material respects with the applicable accounting
requirements of the Act or the Exchange Act, as applicable, and
the related published rules and regulations thereunder; and,
if applicable, they have made a review in accordance with
standards established by the American Institute of Certified
Public Accountants of the consolidated interim financial
statements and selected financial data derived from audited
financial statements of Aetna for the periods specified in such
letter, as indicated in their reports thereon, copies of which
have been furnished to the representatives of the Underwriters
(the "Representatives");
(iii) The unaudited selected financial information
with respect to the consolidated results of operations and
financial position of Aetna for the five most recent fiscal
years included in the Prospectus and included or incorporated
by reference in Item 6 of Aetna's Annual Report on Form 10-K
for the most recent fiscal year agrees with the corresponding
amounts (after restatement where applicable) in the audited
consolidated financial statements for five such fiscal years
which were included or incorporated by reference in Aetna's
Annual Reports on Form 10-K for such fiscal years;
(iv) On the basis of limited procedures, not
constituting an audit in accordance with generally accepted
auditing standards, consisting of a reading of the unaudited
financial statements and other information referred to below, a
reading of the latest available interim financial statements of
Aetna and its subsidiaries, inspection of the minute books of
Aetna and its subsidiaries since the date of the latest audited
financial statements included or incorporated by reference in
the Prospectus, inquiries of officials of Aetna and its
subsidiaries responsible for financial and accounting matters
and such other inquiries and procedures as may be specified in
such letter, nothing came to their attention that caused them
to believe that:
(a) the unaudited condensed consolidated
statements of income, consolidated balance sheets and
consolidated statements of cash flows included or
incorporated by reference in Aetna's Quarterly Reports on
Form 10-Q incorporated by reference in the Prospectus do
not comply as to form in all material respects with the
applicable accounting requirements of the Exchange Act as
it applies to Form 10-Q and the related published rules
and regulations thereunder or, if no report has been
issued by such accountants on the consolidated interim
financial statements as set forth in (ii) above, based
on a review under the applicable professional standards
that any material modifications should be made to such
condensed consolidated financial statements for them to
be in conformity with generally accepted accounting
principles;
(b) any other unaudited income statement
data and balance sheet items included in the Prospectus
do not agree with the corresponding items in the unaudited
consolidated financial statements from which such data
and items were derived, and any such unaudited data and
items were not determined on a basis substantially
consistent with the basis for the corresponding amounts
in the audited consolidated financial statements included
or incorporated by reference in Aetna's Annual Report on
Form 10-K for the most recent fiscal year;
(c) the unaudited financial statements which
were not included in the Prospectus but from which were
derived the unaudited condensed financial statements
referred to in clause (a) above and any unaudited income
statement data and balance sheet items included in the
Prospectus and referred to in Clause (b) above were not
determined on a basis substantially consistent with the
basis for the audited financial statements included or
incorporated by reference in Aetna's Annual Report on
Form 10-K for the most recent fiscal year; and
(d) as of a specified date not more than
five business days prior to the date of such letter,
there have been any changes in the consolidated Common
Stock (other than issuances of common stock pursuant to
employee benefit plans, upon exercise of options and
stock appreciation rights, upon earn-outs of performance
shares and upon conversions of convertible securities),
which were outstanding on the date of the latest balance
sheet included or incorporated by reference in the
Prospectus) or any increase in the consolidated Long-Term
Debt of Aetna and its subsidiaries, as compared with
amounts shown in the latest balance sheet included or
incorporated by reference in the Prospectus, except in
each case for changes or increases which the Prospectus
discloses have occurred or may occur or which are
described in such letter;
(v) In addition to the audit referred to in their
report(s) included or incorporated by reference in the
Prospectus and the limited procedures, inspection of minute
books, inquiries and other procedures referred to in paragraphs
(iii) and (iv) above, they have carried out certain specified
procedures, not constituting an audit in accordance with
generally accepted auditing standards, with respect to certain
amounts, percentages and financial information specified by the
Representatives which are derived from the general accounting
records of Aetna and its subsidiaries, which appear in the
Prospectus (excluding documents incorporated by reference), or
in Part II of, or in exhibits and schedules to, the
Registration Statement specified by the Representatives or in
documents incorporated by reference in the Prospectus specified
by the Representatives, and have compared certain of such
amounts, percentages and financial information with the
accounting records of or schedules prepared by Aetna and its
subsidiaries and have found them to be in agreement; and
(vi) If pro forma financial statements and other pro
forma financial information (the "Pro Forma Disclosure") are
required to be included in the Registration Statement, such
letter shall further state that although they are unable to and
do not express any opinion on such Pro Forma Disclosure or on
the pro forma adjustments applied to the historical amounts
included in that statement, for purposes of such letter they
have:
(a) read the Pro Forma Disclosure;
(b) made inquiries of certain officials of
Aetna who have responsibility for financial and
accounting matters about the basis for their
determination of the pro forma adjustments and whether
the Pro Forma Disclosure above complies in form in all
material respects with the applicable accounting
requirements of Rule 11-02 of Regulation S-X; and
(c) proved the arithmetic accuracy of the
application of the pro forma adjustments to the
historical amounts in the Pro Forma Disclosure; and
on the basis of such procedures, and such other inquiries and
procedures as may be specified in such letter, nothing came to
their attention that caused them to believe that the Pro Forma
Disclosure included in the Registration Statement does not
comply in form in all material respects with the applicable
requirements of Rule 11-02 of Regulation S-X and that the pro
forma adjustments have not been properly applied to the
historical amounts in the compilation of that statement.
All references in this Annex II to the Prospectus shall be
deemed to refer to the Prospectus (including the documents incorporated by
reference therein) as defined in the Underwriting Agreement as of the date of
the letter delivered on the date of the Pricing Agreement for purposes of such
letter and to the Prospectus as amended or supplemented (including the
documents incorporated by reference therein) in relation to the applicable
Designated Preferred Securities for purposes of the letter delivered at the
Time of Delivery for such Designated Preferred Securities.
EXHIBIT 2
Terms of the 9 1/2% Cumulative
Monthly Income Preferred Securities, Series A
DATED AS OF NOVEMBER 15, 1994
WRITTEN ACTION OF THE MANAGING MEMBERS
PURSUANT TO SECTION 7.1 OF THE AMENDED
AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT
OF AETNA CAPITAL L.L.C.
The undersigned, constituting all of the Managing Members of
Aetna Capital L.L.C., a Delaware limited liability company (the "Company"),
pursuant to Section 7.1 of the Amended and Restated Limited Liability Company
Agreement of the Company (the "Agreement") dated as of November 15, 1994 by
and among the Managing Members and the Persons who become Members of the
Company in accordance with the provisions thereof, do hereby authorize the
issue of, and establish the relative rights, powers, preferences, limitations
and restrictions of, a series of Preferred Securities as follows:
1. Definitions. All terms defined in the Agreement and not
otherwise defined herein shall have for purposes hereof the meanings provided
for therein. The following additional terms have the respective meanings
specified below:
"Business Day" means any day other than a day on which banking
institutions in The City of New York are authorized or required by law to
close.
"Expense Agreement" means the Agreement as to Expenses and
Liabilities between Aetna Life and Casualty Company, a Connecticut insurance
corporation ("Aetna"), and the Company, as amended from time to time.
"Guarantee" means the Payment and Guarantee Agreement to be
executed and delivered by Aetna for the benefit of the holders from time to
time of the Series A Preferred Securities and other Preferred Securities of the
Company, as amended from time to time.
"Redemption Price" means, with respect to any date fixed for
redemption of any Series A Preferred Security, the stated liquidation
preference of such Series A Preferred Security, plus accumulated and unpaid
dividends (whether or not declared) to such date.
"Series A Debentures" means the $316,455,696 aggregate
principal amount (or up to $363,924,051 aggregate principal amount if
and to the extent the over-allotment option granted by the Company to the
Underwriters of the Series A Preferred Securities is exercised) of Aetna's 9
1/2% Series A Subordinated Debentures due November 22, 2024 issued pursuant to
the Subordinated Indenture and any other debentures issued under the
Subordinated Indenture upon the terms and subject to the conditions set forth
in Section 6(e) hereof.
"Subordinated Indenture" means the Indenture, dated as of
November 1, 1994, between Aetna and The First National Bank of Chicago, as
Trustee, as amended or supplemented from time to time (including the officer's
certificate establishing the terms of the Series A Debentures).
2. Designation. 10,000,000 of a series of Preferred
Securities (the "Firm Preferred Securities") (or up to 11,500,000 of a series
of Preferred Securities if and to the extent the over-allotment option granted
by the Company to the underwriters of the Series A Preferred Securities is
exercised) with a liquidation preference of $25 per Preferred Security are
hereby authorized and designated as "9 1/2% Cumulative Monthly Income Preferred
Securities, Series A" (hereinafter called the "Series A Preferred Securities").
3. Voting. Except as otherwise provided in the Delaware
Limited Liability Company Act, 6 Del.C. Section 18-101, et seq., as amended or
the Agreement (including, without limitation, Section 8.1 thereof), Preferred
Members holding the Series A Preferred Securities shall have, with respect to
such Series A Preferred Securities, no right or power to vote on any question
or matter or in any proceeding or to be represented at, or to receive notice
of, any meeting of Members.
4. Periodic Dividends. (a) Periodic dividends on the
Series A Preferred Securities shall be cumulative. Such dividends will
accumulate and be cumulative whether or not they have been declared and
whether or not there are profits, surplus or other funds of the Company legally
available for the payment of dividends. Dividends shall accrue from the date
of original issuance of the Firm Preferred Securities and, except in the event
that Aetna exercises its right to extend the interest payment period for the
Series A Debentures in the manner described in the Subordinated Indenture,
shall be payable monthly in arrears on the last day of each calendar month of
each year, commencing on November 30, 1994.
(b) The dividend payable on the Series A Preferred Securities
shall be fixed at a rate of 9 1/2% per annum of the liquidation preference of
the Series A Preferred Securities. The amount of dividends payable for any
full monthly dividend period shall be computed on the basis of twelve 30-day
months and a 360-day year and, for any period shorter than a full monthly
dividend period, shall be computed on the basis of the actual number of days
elapsed in such period. If the interest payment period for the Series A
Debentures is extended in the manner described in the Subordinated Indenture,
then the rate at which dividends on the Series A Preferred Securities
accumulate shall be increased by an amount such that the aggregate amount of
dividends that accumulates on all outstanding Series A Preferred Securities
during such interest extension period is equal to the aggregate amount of
interest (including interest payable on unpaid interest) that accrues during
such interest extension period on the portion of such outstanding Series A
Debentures that evidence the loan to Aetna of the proceeds of the issuance of
the outstanding Series A Preferred Securities. The Company shall only pay
dividends to the extent it has funds legally available to make such payments.
(c) Dividends declared on the Series A Preferred Securities
shall be payable to the record holders thereof as they appear on the register
for the Series A Preferred Securities maintained by or on behalf of the
Company on the relevant record date, which shall be one Business Day prior to
the relevant payment date; provided that in the event that the Series A
Preferred Securities do not remain in book-entry-only form, the relevant
record date shall be the fifteenth day of the month in which the relevant
payment date occurs. If any date on which dividends are payable on the Series
A Preferred Securities is not a Business Day, then the payment of the dividend
payable on such date shall 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) except that, if such Business Day is in the next succeeding calendar
year, such payment shall be made on the immediately preceding Business Day, in
each case with the same force and effect as if made on such date.
(d) Except as described in the Agreement and in this Written
Action, the Series A Preferred Securities shall have no other right to
participate in the profits of the Company.
5. Ranking; Liquidation. (a) The Series A Preferred
Securities shall, with respect to dividend rights and rights on dissolution,
rank (i) pari passu with all other series of Preferred Securities issued by
the Company and (ii) prior to any other Interests of the Company, including
the Common Securities.
(b) In the event of any voluntary or involuntary dissolution
of the Company other than in connection with the exchange of each series of
Preferred Securities for the related series of Debentures, Preferred Members
holding Series A Preferred Securities shall be entitled to receive for each
Series A Preferred Security a liquidation preference of $25 plus accumulated
and unpaid dividends (whether or not declared) to the date of payment.
6. Redemption or Exchange. (a) The Series A Preferred
Securities shall be redeemable at the option of the Company and subject to the
prior consent of Aetna, in whole or in part from time to time, on or after
November 30, 1999, upon not less than 30 nor more than 60 days' notice to the
Preferred Members holding Series A Preferred Securities, at the Redemption
Price.
(b) If the Company is or, in the opinion of counsel (which
counsel is not an employee of AL&C or the Company), would be required to pay
Additional Amounts with respect to the Series A Preferred Securities, the
Company may, upon not less than 30 nor more than 60 days' notice to the
Preferred Members holding Series A Preferred Securities with respect to which
such Additional Amounts are required to be paid, redeem such Series A
Preferred Securities at the Redemption Price.
(c) If there shall have occurred after November 15, 1994, a
change in any applicable U.S. law or regulation or in the interpretation
thereof (including but not limited to the enactment or imminent enactment of
any legislation, the publication of any judicial decisions, regulatory
rulings, regulatory procedures, or notices or announcements (including notices
or announcements of intent to adopt such procedures or regulations), or a
change in the official position or in the interpretation of any law or
regulation by any legislative body, court, governmental authority or
regulatory body, irrespective of the manner in which such change is made
known), and the Company and Aetna shall have been advised by legal counsel
(which counsel is not an employee of Aetna or the Company) that, as a result
of such change, there exists more than an insubstantial risk that (i) Aetna
will be precluded from deducting the interest paid on the Series A Debentures
for federal income tax purposes or (ii) the Company will be subject to federal
income tax with respect to the interest received on the Series A Debentures,
then the Company may, upon not less than 30 nor more than 60 days' notice to
the Preferred Members holding Series A Preferred Securities, either (a) redeem
the Series A Preferred Securities, in whole or in part, at the Redemption
Price or (b) exchange the Series A Preferred Securities for Series A
Debentures having an aggregate principal amount and accrued and unpaid
interest equal to the Redemption Price and having an interest rate thereon
equal to the dividend rate on the Series A Preferred Securities.
(d) After the date fixed for any exchange of Series A
Preferred Securities for Series A Debentures, (i) the Series A Preferred
Securities will no longer be deemed to be outstanding, (ii) certificates
representing Series A Debentures will be issued to holders of certificates
representing Series A Preferred Securities, upon surrender of such
certificates to the Company or its agent for exchange, (iii) any certificates
representing Series A Preferred Securities not so surrendered for exchange
will be deemed to represent Series A Debentures having a principal amount and
accrued and unpaid interest equal to the Redemption Price of such Series A
Preferred Securities until such certificates are so surrendered (and until
such certificates are so surrendered, no payments of interest or principal
will be made with respect to such Series A Debentures) and (iv) all rights of
Preferred Members holding Series A Preferred Securities will cease, except the
right of such Preferred Members to receive Series A Debentures upon surrender
of certificates representing Series A Preferred Securities.
(e) The Series A Preferred Securities shall be redeemed at
the Redemption Price with the proceeds from the repayment by Aetna when due of
the Series A Debentures or upon any optional redemption by Aetna of such
Series A Debentures. Notwithstanding the foregoing, the Series A Preferred
Securities will not be redeemed if (i) in lieu of repaying the Series A
Debentures when due or optionally redeeming such Series A Debentures, Aetna is
permitted by the Company to, and does, exchange such Series A Debentures for
new Debentures or (ii) Aetna repays such Series A Debentures when due or
optionally redeems such Series A Debentures but is permitted by the Company
to, and does, reborrow the proceeds from such repayment or redemption which
reborrowing will be evidenced by new Debentures; provided that the Company
will only permit Aetna to so exchange the Series A Debentures for new
Debentures or reborrow the proceeds from the repayment or redemption thereof
if the Company owns all of the Series A Debentures and the following
conditions are satisfied (which satisfaction in the case of clauses (f)
through (j), shall be determined in the judgment of the Managing Members and
the Company's financial advisor (selected by the Managing Members and who
shall be unaffiliated with Aetna and shall be among the 30 largest investment
banking firms, measured by total capital, in the United States at the time of
the issuance of the new Debentures that will evidence the new loan to be made
in connection with such exchange or reborrowing)), (a) Aetna is not bankrupt,
insolvent or in liquidation, (b) Aetna is not in default in the payment of any
interest or principal under the Subordinated Indenture, (c) Aetna has made
timely payments on the Series A Debentures (and has not elected to extend the
interest payment period for the Series A Debentures in the manner described in
the Subordinated Indenture) for the immediately preceding 24 months (and has
not elected to extend any interest payment period for the Series A Debentures
during such 24 month period), (d) such new loan will mature no later than the
earlier of (1) the 49th anniversary of the date of the initial issuance of the
Series A Debentures and (2) the 30th anniversary of the date such new loan is
made, (e) the Company is not in arrears on payments of dividends on the Series
A Preferred Securities, (f) Aetna is expected to be able to make timely
payment of principal of and interest on such new loan, (g) such new loan is
being made on terms, and under circumstances, that are consistent with those
which a lender would then require for a loan to an unrelated party, (h) such
new loan is being made at a rate sufficient to provide payments equal to or
greater than the amount of dividend payments required under the Series A
Preferred Securities, (i) such new loan is being made for a term that is
consistent with market circumstances and Aetna's financial condition and (j)
immediately prior to the making of such new loan, the senior unsecured
long-term debt of Aetna is (or if no such debt is outstanding, would be) rated
not less than BBB (or the equivalent) by Standard & Poor's Corporation and
Baa2 (or the equivalent) by Moody's Investors Service, Inc. and the
subordinated unsecured long-term debt of Aetna (or, if more than one issue of
such subordinated debt is outstanding, the most junior of such issues) is (or
if no such debt is outstanding, would be) rated not less than BBB- (or the
equivalent) by Standard & Poor's Corporation and Baa3 by Moody's Investors
Service, Inc. (or if either of such rating organizations is not then rating
Aetna's senior or subordinated unsecured long-term debt, as the case may be,
the equivalent of such ratings by any other "nationally recognized statistical
rating organization," as that term is defined by the Securities and Exchange
Commission for purposes of Rule 436(g)(2) under the Securities Act of 1933, as
amended).
(f) The Company may not redeem any Series A Preferred
Securities unless all accumulated arrears of unpaid dividends have been paid
on all Preferred Securities of all series for all monthly dividend periods
terminating on or prior to the date of redemption.
(g) If the Company gives a notice of redemption in respect of
any Series A Preferred Securities, then, by 12:00 noon, New York time, on the
date fixed for redemption, the Company will, so long as the Series A Preferred
Securities are in book-entry-only form, irrevocably deposit with the
securities depository for the Series A Preferred Securities funds sufficient
to pay the applicable Redemption Price and will give such depository
irrevocable instructions and authority to pay the Redemption Price to the
holders thereof. If the Series A Preferred Securities are no longer in
book-entry-only form, the Company will irrevocably deposit with the paying
agent for the Series A Preferred Securities funds sufficient to pay the
applicable Redemption Price and will give such paying agent irrevocable
instructions and authority to pay the Redemption Price to the holders thereof
upon surrender of their Series A Preferred Security certificates.
Notwithstanding the foregoing, dividends payable on or prior to the redemption
date for any Series A Preferred Securities called for redemption shall be
payable to the holders of such Series A Preferred Securities on the relevant
record dates for the payments thereof. If notice of redemption shall have been
given and funds deposited as required, then upon the date of such deposit, all
rights of Preferred Members holding Series A Preferred Securities so called
for redemption will cease, except the right of such Preferred Members to
receive the Redemption Price, but without interest, and such securities will
cease to be outstanding. In the event that any date on which any payment in
respect of the redemption of any Series A Preferred Securities is payable is
not a Business Day, then payment of the Redemption Price 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), except that, if
such Business Day falls in the next calendar year, such payment will be made
on the immediately preceding Business Day. In the event that payment of the
Redemption Price in respect of any Series A Preferred Securities called for
redemption is improperly withheld or refused and not paid either by the
Company or by Aetna pursuant to the Guarantee, dividends on such Series A
Preferred Securities will continue to accrue, at the then applicable rate,
from the Redemption Date originally established by the Company for such Series
A Preferred Securities to the date such Redemption Price is actually paid, in
which case the actual payment date will be the date fixed for redemption for
purposes of calculating the Redemption Price.
(h) Subject to the foregoing and applicable law (including,
without limitation, U.S. federal securities laws) Aetna or its subsidiaries
may at any time and from time to time purchase outstanding Series A Preferred
Securities by tender, in the open market or by private agreement.
7. No Sinking Fund. The Series A Preferred Securities shall
not be subject to the operation of a retirement or sinking fund.
8. Guarantee of Liabilities. It shall be a condition
precedent to the issuance of the Series A Preferred Securities that Aetna
execute the Guarantee and the Expense Agreement.
9. Book-Entry-Only Issuance. (a) The Depository Trust
Company, New York, New York ("DTC"), will initially act as securities
depository for the Series A Preferred Securities. The Series A Preferred
Securities will be issued only as fully-registered securities registered in
the name of Cede & Co. (DTC's partnership nominee).
(b) Redemption notices shall be sent to Cede & Co. If less
then all of the Series A Preferred Securities are being redeemed, such
securities shall be redeemed in accordance with DTC's then current practice.
(c) DTC may discontinue providing its services as securities
depository with respect to the Series A Preferred Securities by giving
reasonable notice to the Company as provided in the agreement between the
Company and DTC. Under such circumstances, if a successor securities
depositary is not obtained, the Company at its expense shall cause
certificates for Series A Preferred Securities to be printed and delivered as
promptly as practicable.
(d) In the event that the Series A Preferred Securities do not
remain in book-entry-only form, the following provisions will apply:
(1) Registration of transfers of Series A Preferred
Securities will be effected without charge by or on behalf of
the Company, but upon payment (with the giving of such
indemnity as the Company or Aetna may require) in respect of any
tax or other governmental charges which may be imposed in
connection therewith.
(2) Exchanges of Series A Preferred Securities for
Series A Debentures will be effected without charge by or on
behalf of the Company, but upon payment (with the giving of such
indemnity as the Company or Aetna may require) in respect of
any tax or other governmental charges which may be imposed in
connection with the issuance of any Series A Debenture in the
name of any person other than the registered holder of the
Series A Preferred Security for which the Series A Debenture is
being exchanged or for any reason other than such exchange.
(3) The Company will not be required to register or
cause to be registered the transfer of Series A Preferred
Securities after such Preferred Securities have been called for
redemption or exchange.
10. Authorization of Agreements. The Company, and either
Managing Member on behalf of the Company, may enter into and perform the
Expense Agreement and the Pricing Agreement dated November 15, 1994 among the
Company, Aetna and Goldman, Sachs & Co., CS First Boston Corporation, Dean
Witter Reynolds Inc., A.G. Edwards & Sons, Inc., Merrill Lynch, Pierce, Fenner
& Smith Incorporated, Morgan Stanley & Co. Incorporated, PaineWebber
Incorporated and Smith Barney Inc., as representatives of the several
Underwriters named in the Pricing Agreement (such Pricing Agreement, including
the terms of the Underwriting Agreement dated November 15, 1994 executed by
the Company and Aetna and incorporated by reference therein, the "Underwriting
Agreement") without any further act, vote or approval of any Member. The
times, prices and other terms and conditions of the offering of the Series A
Preferred Securities, to the extent not set forth herein or in the Agreement,
shall be as set forth in the Underwriting Agreement.
11. Registrar and Transfer Agent. The Company hereby appoints
First Chicago Trust Company of New York as its initial registrar, transfer
agent and Paying Agent for the Series A Preferred Securities.
12. Form of Certificate. The certificates evidencing the
Series A Preferred Securities shall be in substantially in the form attached
hereto as Annex A, with such changes as the officer of the Managing Member
executing the same shall approve, such approval to be evidenced by such
officer's manual or facsimile signature.
13. Governing Law. This Written Action shall be governed by
and construed in accordance with the laws of the State of Delaware without
giving effect to the principles of conflict of laws thereof.
IN WITNESS WHEREOF, the undersigned Managing Members of the
Company have hereto set their hands as of the day and year first above written.
AETNA LIFE AND CASUALTY
COMPANY
By:___________________________
Name:
Title:
AETNA CAPITAL HOLDINGS, INC.
By:___________________________
Name:
Title:
ANNEX A
Certificate Number of
Number Preferred Securities
CUSIP NO. 008095200
CERTIFICATE EVIDENCING LIMITED LIABILITY COMPANY INTERESTS
9 1/2% CUMULATIVE MONTHLY INCOME PREFERRED SECURITIES, SERIES A
OF
AETNA CAPITAL L.L.C.
Aetna Capital L.L.C., a Delaware limited liability company (the "Company"),
hereby certifies that Cede & Co. (the "Holder") is the registered owner of
preferred limited liability company interests in the Company of a series
designated the 9 1/2% Cumulative Monthly Income Preferred Securities, Series A
(the "Securities"). The Securities are fully paid and nonassessable limited
liability company interests in the Company, as to which the members of the
Company who hold the Securities (the "Preferred Securityholders") in their
capacity as members of the Company will have no liability solely by reason of
being Preferred Securityholders in excess of their share of the Company's
assets and undistributed profits (subject to the obligation of a Preferred
Securityholder to repay any funds wrongfully distributed to it), and are
transferable on the books and records of the Company, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer. The powers, preferences and special rights and
restrictions of the Securities are set forth in, and this Certificate and the
Securities represented hereby are issued and shall in all respects be subject
to the terms and provisions of, the Amended and Restated Limited Liability
Company Agreement of the Company, dated as of November 15, 1994, as
the same may be amended from time to time (the "Limited Liability Company
Agreement") and the written action of the Managing Members of the Company
authorizing the issuance of the Securities and determining the powers,
preferences and special rights and restrictions, regarding dividends, voting,
redemption, exchange, return of capital and otherwise, and other matters
relating to the Securities (the "Securities Terms"), copies of which Limited
Liability Company Agreement and Securities Terms are on file at the principal
place of business of the Company. The Company will furnish a copy of such
Limited Liability Company Agreement and Securities Terms to each Preferred
Securityholder without charge upon written request to the Company at its
principal place of business or registered office, as the case may be. Each
Preferred Securityholder is entitled to the benefits of the Payment and
Guarantee Agreement of Aetna Life and Casualty Company ("Aetna") dated
November 22, 1994 (the "Guarantee") to the extent provided therein and is
entitled to enforce the rights of the Company under the related series of
debentures (the "Debentures") issued by Aetna to the Company pursuant to the
Subordinated Indenture dated November 1, 1994 between Aetna and The First
National Bank of Chicago, as trustee (the "Subordinated Indenture"), to the
extent provided therein. The Company will furnish a copy of such Guarantee
and Subordinated Indenture to each Preferred Securityholder without charge
upon written request to the Company at its principal place of business.
Each Preferred Securityholder, by accepting this Certificate, is deemed to
have (i) agreed that the Debentures are subordinate and junior in right of
payment to all Senior Debt (as defined in the Subordinated Indenture) as and
to the extent provided in the Subordinated Indenture and (ii) agreed that the
Guarantee is subordinate and junior in right of payment to all liabilities of
Aetna and pari passu with the most senior preferred or preference stock of any
series now or hereafter issued by Aetna and pari passu with any guarantee now
or hereafter entered into by Aetna in respect of any preferred or preference
stock or interest of any affiliate of Aetna, as and to the extent provided in
the Guarantee.
IN WITNESS WHEREOF, this certificate has been signed on behalf of the Company
by a duly authorized officer of one of its Managing Members and on behalf of
Aetna, as Guarantor, by a duly authorized officer thereof and countersigned by
a duly authorized officer of First Chicago Trust Company of New York, as
Registrar and Transfer Agent.
Dated: AETNA CAPITAL L.L.C.
BY AETNA LIFE AND CASUALTY
COMPANY,
AS MANAGING MEMBER
By: _________________________
By: FIRST CHICAGO TRUST COMPANY By: AETNA LIFE AND CASUALTY
OF NEW YORK, COMPANY,
AS REGISTRAR AND TRANSFER AGENT AS GUARANTOR
By: ___________________________ By: _________________________
EXHIBIT 3
AETNA LIFE AND CASUALTY COMPANY
TO
THE FIRST NATIONAL BANK OF CHICAGO, TRUSTEE
__________
SUBORDINATED INDENTURE
Dated as of November 1, 1994
__________
Debentures
AETNA LIFE AND CASUALTY COMPANY
Reconciliation and tie between certain Sections of
this Indenture, dated as of November 1, 1994, and
Sections 310 through 318, inclusive, of
the Trust Indenture Act of 1939:
Trust Indenture
Act Section Indenture Section
Section 310(a)(1)................................... 609
(a)(2)................................... 609
(a)(3)................................... Not Applicable
(a)(4)................................... Not Applicable
(b)...................................... 608
610
Section 311(a)...................................... 613
(b)...................................... 613
Section 312(a)...................................... 701
702(a)
(b)...................................... 702(b)
(c)...................................... 702(c)
Section 313(a)...................................... 703(a)
(b)...................................... 703(a)
(c)...................................... 703(a)
(d)...................................... 703(b)
Section 314(a)...................................... 704
(a)(4)................................... 101
1004
(b)...................................... Not Applicable
(c)(1)................................... 102
(c)(2)................................... 102
(c)(3)................................... Not Applicable
(d)...................................... Not Applicable
(e)...................................... 102
Section 315(a)...................................... 601
(b)...................................... 602
(c)...................................... 601
(d)...................................... 601
(e)...................................... 516
Section 316(a)...................................... 101
(a)(1)(A)................................ 503
504
514
(a)(1)(B)................................ 515
(a)(2)................................... Not Applicable
(b)...................................... 510
(c)...................................... 104(c)
Section 317(a)(1)................................... 505
(a)(2)................................... 506
(b)...................................... 1003
Section 318(a)...................................... 107
___________________
NOTE: This reconciliation and tie shall not, for any purpose, be
deemed to be a part of the Indenture.
TABLE OF CONTENTS
Page
PARTIES.................................................................... 1
RECITALS OF THE COMPANY.................................................... 1
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.............................................. 1
Act...................................................... 2
Additional Amounts....................................... 2
Additional Interest...................................... 2
Authenticating Agent..................................... 2
Board of Directors....................................... 3
Board Resolution......................................... 3
Business Day............................................. 3
Capital.................................................. 3
Commission............................................... 3
Common Security.......................................... 3
Common Stock............................................. 3
Company.................................................. 4
Company Request.......................................... 4
Company Order............................................ 4
Corporate Trust Office................................... 4
corporation.............................................. 4
Covenant Defeasance...................................... 4
Debenture................................................ 4
Debenture Register....................................... 4
Debenture Registrar...................................... 4
Debt..................................................... 4
Defaulted Interest....................................... 5
Defeasance............................................... 5
Depositary............................................... 5
Event of Default......................................... 5
Exchange Act............................................. 5
Floating or Adjustable Rate Debenture.................... 5
Floating or Adjustable Rate Provision.................... 5
Global Debenture......................................... 5
Guarantee................................................ 5
Holder................................................... 6
Indenture................................................ 6
Interest Payment Date.................................... 6
Junior Subordinated Payment.............................. 6
L.L.C. Agreement......................................... 6
Managing Members......................................... 6
Maturity................................................. 6
Notice of Default........................................ 6
Officers' Certificate.................................... 6
Opinion of Counsel....................................... 7
Outstanding.............................................. 7
Paying Agent............................................. 8
Person................................................... 8
Place of Payment......................................... 8
Predecessor Debenture.................................... 8
Preferred Security....................................... 8
Proceeding............................................... 8
Redemption Date.......................................... 9
Redemption Price......................................... 9
Regular Record Date...................................... 9
Responsible Officer...................................... 9
Security Exchange........................................ 9
Senior Debt.............................................. 9
Special Record Date...................................... 10
Stated Maturity.......................................... 10
Subsidiary............................................... 10
Trustee.................................................. 10
Trust Indenture Act...................................... 10
U.S. Government Obligations.............................. 10
Vice President........................................... 10
Written Action........................................... 10
Section 102. Compliance Certificates and Opinions..................... 11
Section 103. Form of Documents Delivered to Trustee................... 11
Section 104. Acts of Holders; Record Dates............................ 12
Section 105. Notices, Etc., to Trustee and Company.................... 14
Section 106. Notice to Holders; Waiver................................ 15
Section 107. Conflict with Trust Indenture Act........................ 15
Section 108. Effect of Headings and Table of Contents................. 16
Section 109. Successors and Assigns................................... 16
Section 110. Separability Clause...................................... 16
Section 111. Benefits of Indenture.................................... 16
Section 112. Governing Law............................................ 16
Section 113. Legal Holidays........................................... 16
Section 114. Personal Immunity from Liability for Incorporators,
Stockholders, Etc........................................ 17
ARTICLE TWO
Debenture Form
Section 201. Forms Generally.......................................... 17
Section 202. Form of Face of Debenture................................ 18
Section 203. Form of Reverse of Debenture............................. 20
Section 204. Form of Legend for Global Debentures..................... 23
Section 205. Form of Trustee's Certificate of Authentication.......... 23
ARTICLE THREE
The Debentures
Section 301. Amount Unlimited; Issuable in Series..................... 24
Section 302. Denominations............................................ 27
Section 303. Execution, Authentication, Delivery and Dating........... 27
Section 304. Temporary Debentures..................................... 30
Section 305. Registration, Registration of Transfer and Exchange...... 30
Section 306. Mutilated, Destroyed, Lost and Stolen Debentures......... 32
Section 307. Payment of Interest; Interest Rights Preserved........... 33
Section 308. Persons Deemed Owners.................................... 35
Section 309. Cancellation............................................. 35
Section 310. Computation of Interest.................................. 36
Section 311. Additional Interest...................................... 36
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture.................. 37
Section 402. Application of Trust Fund................................ 39
ARTICLE FIVE
Remedies
Section 501. Events of Default........................................ 39
Section 502. Acceleration of Maturity................................. 42
Section 503. Collection of Indebtedness and Suits for Enforcement by
Trustee................................................ 45
Section 504. Trustee May File Proofs of Claim......................... 46
Section 505. Trustee May Enforce Claims Without Possession of
Debentures............................................... 47
Section 506. Application of Money Collected........................... 47
Section 507. Limitation on Suits...................................... 47
Section 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest..................................... 49
Section 509. Restoration of Rights and Remedies....................... 49
Section 510. Rights and Remedies Cumulative........................... 49
Section 511. Delay or Omission Not Waiver............................. 49
Section 512. Control by Holders....................................... 50
Section 513. Waiver of Past Defaults.................................. 51
Section 514. Undertaking for Costs.................................... 51
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities...................... 52
Section 602. Notice of Defaults....................................... 52
Section 603. Certain Rights of Trustee................................ 52
Section 604. Not Responsible for Recitals or Issuance of Debentures... 54
Section 605. May Hold Debentures...................................... 54
Section 606. Money Held in Trust...................................... 55
Section 607. Compensation and Reimbursement........................... 55
Section 608. Disqualification; Conflicting Interests.................. 55
Section 609. Corporate Trustee Required; Eligibility.................. 56
Section 610. Resignation and Removal; Appointment of Successor........ 56
Section 611. Acceptance of Appointment by Successor................... 58
Section 612. Merger, Conversion, Consolidation or Succession to
Business............................................... 59
Section 613. Preferential Collection of Claims Against Company........ 60
Section 614. Appointment of Authenticating Agent...................... 60
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and
Addresses of Holders..................................... 62
Section 702. Preservation of Information; Communications to Holders... 63
Section 703. Reports by Trustee....................................... 63
Section 704. Reports by Company....................................... 64
ARTICLE EIGHT
Consolidation, Merger, or Sale of Assets
Section 801. Company May Consolidate, Etc., Only on Certain Terms..... 64
Section 802. Successor Substituted.................................... 65
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders....... 65
Section 902. Supplemental Indentures with Consent of Holders.......... 67
Section 903. Execution of Supplemental Indentures..................... 69
Section 904. Effect of Supplemental Indentures........................ 69
Section 905. Conformity with Trust Indenture Act...................... 69
Section 906. Reference in Debentures to Supplemental Indentures....... 70
Section 907. Waiver of Compliance by Holders.......................... 70
Section 908. Subordination Unimpaired................................. 70
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest............... 71
Section 1002. Maintenance of Office or Agency.......................... 71
Section 1003. Money for Debentures Payments to Be Held in Trust........ 71
Section 1004. Statement by Officers as to Default...................... 73
Section 1005. Limitations on Dividends and Other Payments on Capital
Stock.................................................. 73
Section 1006. Limitations on Conduct of Capital and Other
Limitations............................................ 74
Section 1007. Stock Exchange Listing................................... 74
ARTICLE ELEVEN
Redemption of Debentures
Section 1101. Applicability of Article................................. 75
Section 1102. Election to Redeem; Notice to Trustee.................... 75
Section 1103. Selection by Trustee of Debentures to Be Redeemed........ 75
Section 1104. Notice of Redemption..................................... 76
Section 1105. Deposit of Redemption Price.............................. 77
Section 1106. Debentures Payable on Redemption Date.................... 77
Section 1107. Debentures Redeemed in Part.............................. 77
ARTICLE TWELVE
Defeasance and Covenant Defeasance
Section 1201. Company's Option to Effect Defeasance or
Covenant Defeasance...................................... 78
Section 1202. Defeasance and Discharge................................. 78
Section 1203. Covenant Defeasance...................................... 79
Section 1204. Conditions to Defeasance or Covenant Defeasance.......... 79
Section 1205. Deposited Money and U.S. Government Obligations to be
Held In Trust; Other Miscellaneous Provisions............ 82
Section 1206. Reinstatement............................................ 83
ARTICLE THIRTEEN
Sinking Funds
Section 1301. Applicability of Article................................. 83
Section 1302. Satisfaction of Sinking Fund Payments
with Debentures.......................................... 84
Section 1303. Redemption of Debentures for Sinking Fund................ 84
ARTICLE FOURTEEN
Subordination of Debentures
Section 1401. Debentures Subordinate to Senior Debt.................... 84
Section 1402. Payment Over of Proceeds Upon Dissolution, Etc........... 85
Section 1403. Prior Payment to Senior Debt Upon
Acceleration of Debentures............................. 87
Section 1404. No Payment When Senior Debt in Default................... 87
Section 1405. Payment Permitted If No Default.......................... 88
Section 1406. Subrogation to Rights of Holders of Senior Debt.......... 88
Section 1407. Provisions Solely to Define Relative Rights.............. 89
Section 1408. Trustee to Effectuate Subordination...................... 90
Section 1409. No Waiver of Subordination Provisions.................... 90
Section 1410. Notice to Trustee........................................ 91
Section 1411. Reliance on Judicial Order or Certificate of Liquidating
Agent.................................................. 92
Section 1412. Trustee Not Fiduciary For Holders of Senior Debt......... 92
Section 1413. Rights of Trustee as Holder of Senior Debt; Preservation
of Trustee's Rights.................................... 92
Section 1414. Article Applicable to Paying Agents...................... 92
Section 1415. Defeasance of This Article Fourteen...................... 93
ARTICLE FIFTEEN
Miscellaneous
Section 1501. Assignment; Binding Effect.................................. 93
Section 1502. Third Party Beneficiaries................................... 93
Section 1503. Set-off..................................................... 94
INDENTURE, dated as of November 1, 1994, between AETNA LIFE AND
CASUALTY COMPANY, a Connecticut insurance corporation (herein called the
"Company"), having its principal office at 151 Farmington Avenue, Hartford,
Connecticut 06156, and THE FIRST NATIONAL BANK OF CHICAGO, a national
association duly organized and existing under the laws of the United States of
America, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its debentures,
notes or other evidences of indebtedness (herein called the "Debentures"), to
be issued in one or more series to evidence its indebtedness resulting from
the loans to be made to the Company of the proceeds from the issuance from
time to time by Aetna Capital L.L.C., a Delaware limited liability company
("Capital"), of preferred limited liability company interests in Capital (the
"Preferred Securities"), in one or more series, and common limited liability
company interests in Capital (the "Common Securities") and related capital
contributions.
All things necessary to make this Indenture a valid agreement of
the Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Debentures by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Debentures or of series thereof,
as follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as
the singular;
(2) all other terms used herein which are defined in the
Trust Indenture Act or the Securities Act of 1933, as amended,
either directly or by reference therein, have the meanings
assigned to them therein;
(3) all accounting terms not otherwise defined herein have
the meanings assigned to them in accordance with generally accepted
accounting principles, and, except as otherwise herein expressly
provided, the term "generally accepted accounting principles" with
respect to any computation required or permitted hereunder shall
mean such accounting principles as are generally accepted at the
date of such computation;
(4) the words "Article" and "Section" refer to an Article
and Section, respectively, of this Indenture; and
(5) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a whole and not
to any particular Article, Section or other subdivision.
"Act", when used with respect to any Holder, has the meaning
specified in Section 104.
"Additional Amounts" when used with respect to the Preferred
Securities of any series means any additional amounts that Capital is required
to pay as dividends to holders of the Preferred Securities of such series
pursuant to the Written Action establishing the Preferred Securities of such
series in the event that Capital is required by law to withhold or deduct for
or on account of any present or future taxes, duties, assessments or
governmental charges of whatever nature imposed or levied upon or as a result
of payments by Capital in respect of the Preferred Securities of such series
by or on behalf of the United States of America, any state thereof or any
other jurisdiction through which or from which such payment is made, or any
authority therein or thereof having power to tax.
"Additional Interest" has the meaning specified in Section
311.
"Authenticating Agent" means any Person authorized by the
Trustee pursuant to Section 614 to act on behalf of the Trustee to
authenticate Debentures of one or more series.
"Board of Directors" means either (i) the board of directors
of the Company, the executive committee of such board of directors or any
other duly authorized committee of directors and/or officers appointed by such
board of directors or executive committee, or (ii) one or more duly authorized
officers of the Company to whom the board of directors of the Company or a
committee thereof has delegated the authority to act with respect to the
matters contemplated by this Indenture.
"Board Resolution" means (i) a copy of a resolution
certified by the Corporate Secretary or an Assistant Corporate Secretary of
the Company to have been duly adopted by the Board of Directors or a committee
thereof and to be in full force and effect on the date of such certification
or (ii) a certificate signed by the authorized officer or officers of the
Company to whom the board of directors of the Company or a committee thereof
has delegated its authority (as described in the definition of Board of
Directors), and in each case, delivered to the Trustee.
"Business Day" means each Monday, Tuesday, Wednesday,
Thursday and Friday which is not a day on which banking institutions in The
City of New York are authorized or required by law or executive order to close.
"Capital" means the Person named as "Capital" in the first
recital of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Capital" shall mean such successor Person.
"Commission" means the Securities and Exchange Commission,
as from time to time constituted, created under the Exchange Act, or, if at
any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the Trust
Indenture Act, then the body performing such duties at such time.
"Common Security" has the meaning stated in the first
recital of this Indenture.
"Common Stock" means the Company's common capital stock,
without par value.
"Company" means the Person named as the "Company" in the
first paragraph of this instrument until a successor Person shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company by (i) any two of the following
individuals: the Chairman, a Vice Chairman, the President, a Group Executive
or a Vice President, or (ii) by one of the foregoing individuals and by any
other Vice President, the Treasurer, an Assistant Treasurer, the Corporate
Secretary or an Assistant Corporate Secretary or any other individual
authorized by the Board of Directors for such purpose, and delivered to the
Trustee.
"Corporate Trust Office" means the principal office of the
Trustee located at 1 North State Street, 9th Floor, Chicago, Illinois 60602 at
which at any particular time its corporate trust business shall be
administered.
"corporation" means a corporation, association, company,
joint-stock company or business trust.
"Covenant Defeasance" has the meaning specified in Section
1203.
"Debenture" has the meaning stated in the first recital of
this Indenture and more particularly means the Debentures of any series,
issued from time to time, by the Company pursuant to this Indenture.
"Debenture Register" and "Debenture Registrar" have the
respective meanings specified in Section 305.
"Debt" means (without duplication and without regard to any
portion of principal amount that has not accrued and to any interest component
thereof (whether accrued or imputed) that is not due and payable) with respect
to any Person, whether recourse is to all or a portion of the assets of such
Person and whether or not contingent, (i) every obligation of such Person for
money borrowed, (ii) every obligation of such Person evidenced by bonds,
debentures, notes or other similar instruments, including obligations incurred
in connection with the acquisition of property, assets or businesses, (iii)
every reimbursement obligation of such Person with respect to letters of
credit, bankers' acceptances or similar facilities issued for the account of
such Person, (iv) every obligation of such Person issued or assumed as the
deferred purchase price of property or services (but excluding trade accounts
payable or accrued liabilities arising in the ordinary course of business),
(v) every capital lease obligation of such Person and (vi) every obligation of
the type referred to in clauses (i) through (v) of another Person and all
dividends of another Person the payment of which, in either case, such Person
has guaranteed or is responsible or liable, directly or indirectly, as obligor
or otherwise.
"Defaulted Interest" has the meaning specified in Section
307.
"Defeasance" has the meaning specified in Section 1202.
"Depositary" means, with respect to Debentures of any series
issuable in whole or in part in the form of one or more Global Debentures, a
clearing agency registered under the Exchange Act that is designated to act as
Depositary for such Debentures as contemplated by Section 301.
"Event of Default" has the meaning set forth in Section 501
hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute thereto.
"Floating or Adjustable Rate Debenture" means any Debenture
which provides for interest thereon at a periodic rate that may vary from time
to time over the term thereof in accordance with a Floating or Adjustable Rate
Provision.
"Floating or Adjustable Rate Provision" means a formula or
provision, specified in or pursuant to a Board Resolution or an indenture
supplemental hereto, providing for the determination, whether pursuant to
objective factors or pursuant to the sole discretion of any Person (including
the Company), and periodic adjustment of the interest rate borne by a Floating
or Adjustable Rate Debenture.
"Global Debenture" means a Debenture that evidences all or
part of the Debentures of any series and is authenticated and delivered to,
and registered in the name of, the Depositary for such Debentures or a nominee
thereof.
"Guarantee" means the Payment and Guarantee Agreement
executed and delivered by the Company for the benefit of the holders from time
to time of the Preferred Securities, as amended from time to time.
"Holder" means a Person in whose name a Debenture is
registered in the Debenture Register.
"Indenture" means this instrument as originally executed or
as it may from time to time be supplemented or amended by one or more
indentures supplemental hereto entered into pursuant to the applicable
provisions hereof, including, for all purposes of this instrument, and any such
supplemental indenture, the provisions of the Trust Indenture Act that are
deemed to be a part of and govern this instrument and any such supplemental
indenture, respectively. The term "Indenture" shall also include the terms of
particular series of Debentures established as contemplated by Section 301.
"Interest Payment Date", when used with respect to any
Debenture, means the Stated Maturity of an instalment of interest on such
Debenture.
"Junior Subordinated Payment" has the meaning specified in
Section 1402.
"L.L.C. Agreement" means the Amended and Restated Limited
Liability Company Agreement of Capital by and among the members of Capital, as
amended from time to time.
"Managing Members" means the Company and Aetna Capital
Holdings, Inc., in their capacity as the members of Capital that hold all of
Capital's outstanding Common Securities.
"Maturity", when used with respect to any Debenture, means
the date on which the principal of such Debenture or an instalment of
principal becomes due and payable as therein or herein provided, whether at
the Stated Maturity or by declaration of acceleration, call for redemption or
otherwise.
"Notice of Default" means a written notice of the kind
specified in Section 501(3).
"Officers' Certificate" means a certificate signed by (i)
any two of the following individuals: the Chairman, a Vice Chairman, the
President, a Group Executive or a Vice President, or (ii) by one of the
foregoing individuals and by any other Vice President, the Treasurer, an
Assistant Treasurer, the Corporate Secretary or an Assistant Corporate
Secretary, of the Company, or any other individual authorized by the Board of
Directors for such purpose, and delivered to the Trustee. One of the officers
signing an Officers' Certificate given pursuant to Section 1004 shall be the
principal executive, financial or accounting officer of the Company.
"Opinion of Counsel" means a written opinion of counsel, who
may be an employee of or counsel to the Company, or who may be other counsel
reasonably satisfactory to the Trustee.
"Outstanding", when used with respect to Debentures, means,
as of the date of determination, all Debentures theretofore authenticated and
delivered under this Indenture, except:
(i) Debentures theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation;
(ii) Debentures for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Trustee
or any Paying Agent (other than the Company) in trust or set aside
and segregated in trust by the Company (if the Company shall act as
its own Paying Agent) for the Holders of such Debentures; provided
that, if such Debentures are to be redeemed, notice of such
redemption has been duly given pursuant to this Indenture or
provision therefor satisfactory to the Trustee has been made;
(iii) Debentures as to which Defeasance has been effected
pursuant to Section 1202; and
(iv) Debentures which have been paid pursuant to Section 306
or in exchange for or in lieu of which other Debentures have been
authenticated and delivered pursuant to this Indenture, other than
any such Debentures in respect of which there shall have been
presented to the Trustee proof satisfactory to it that such
Debentures are held by a bona fide purchaser in whose hands such
Debentures are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Debentures have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Debentures
owned by the Company or any other obligor upon the Debentures or any
Subsidiary of the Company or of such other obligor shall be disregarded and
deemed not to be Outstanding, except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Debentures which the Trustee knows
to be so owned shall be so disregarded. Debentures so owned which have been
pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Debentures and that the pledgee is not the Company or any
other obligor upon the Debentures or any Subsidiary of the Company or of such
other obligor.
"Paying Agent" means any Person authorized by the Company to
pay the principal of or any premium or interest on any Debentures on behalf of
the Company.
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, trust, unincorporated organization
or government or any agency or political subdivision thereof.
"Place of Payment", when used with respect to the Debentures
of any series, means the place or places where the principal of and any
premium and interest on the Debentures of that series are payable as specified
as contemplated by Section 301.
"Predecessor Debenture" of any particular Debenture means
every previous Debenture evidencing all or a portion of the same debt as that
evidenced by such particular Debenture; and, for the purposes of this
definition, any Debenture authenticated and delivered under Section 306 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Debenture
shall be deemed to evidence the same debt as the mutilated, destroyed, lost or
stolen Debenture.
"Preferred Security" has the meaning stated in the first
recital of this Indenture.
"Proceeding" has the meaning specified in Section 1402.
"Redemption Date", when used with respect to any Debenture
to be redeemed, means the date fixed for such redemption by or pursuant to
this Indenture.
"Redemption Price", when used with respect to any Debenture
to be redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Regular Record Date" for the interest payable on any
Interest Payment Date on the Debentures of any series means the date specified
for that purpose as contemplated by Section 301.
"Responsible Officer", when used with respect to the
Trustee, means the chairman or any vice-chairman of the board of directors,
the chairman or any vice-chairman of the executive committee of the board of
directors, the chairman of the trust committee, the president, any vice
president, the secretary, any assistant secretary, the treasurer, any
assistant treasurer, the cashier, any assistant cashier, any trust officer or
assistant trust officer, the controller or any assistant controller or any
other officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and also means, with respect
to a particular corporate trust matter, any other officer to whom such matter
is referred because of his or her knowledge of and familiarity with the
particular subject.
"Security Exchange" when used with respect to the Debentures
of any series, means an exchange by Capital of Debentures of such series for
Preferred Securities of the related series pursuant to the Written Action
establishing the Preferred Securities of such series.
"Senior Debt" means the principal of (and premium, if any)
and interest, if any, (including interest accruing on or after the filing of
any petition in bankruptcy or for reorganization relating to the Company to
the extent that such claim for post-petition interest is allowed in such
proceeding) on Debt of the Company, whether incurred on or prior to the date
of the Indenture or thereafter incurred, unless, in the instrument creating or
evidencing the same or pursuant to which the same is outstanding, it is
provided that such obligations are not superior in right of payment to the
Debentures or to other Debt which is pari passu with, or subordinated to the
Debentures or to other securities of the Company which are junior to the
Debentures; provided, however, that Senior Debt shall not be deemed to include
the Debentures.
"Special Record Date" for the payment of any Defaulted
Interest means a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Debenture
or any instalment of principal thereof or interest thereon, means the date
specified in such Debenture as the fixed date on which the principal of such
Debenture or such instalment of principal or interest is due and payable.
"Subsidiary" means a corporation more than 50% of the voting
power of which is controlled, directly or indirectly, by the Company or by one
or more other Subsidiaries, or by the Company and one or more other
Subsidiaries. For the purposes of this definition, "voting power" means the
power to vote for the election of directors, whether at all times or only so
long as no senior class of stock has such voting power by reason of any
contingency.
"Trustee" means the Person named as the "Trustee" in the
first paragraph of this instrument until a successor Trustee shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each Person who is then a Trustee hereunder,
and if at any time there is more than one such Person, "Trustee" as used with
respect to the Debentures of any series shall mean the Trustee with respect to
Debentures of that series.
"Trust Indenture Act" means the Trust Indenture Act of 1939
as in force at the date as of which this instrument was executed; provided,
however, that in the event the Trust Indenture Act of 1939 is amended after
such date, "Trust Indenture Act" means, to the extent required by any such
amendment, the Trust Indenture Act of 1939 as so amended.
"U.S. Government Obligations" has the meaning specified in
Section 1204.
"Vice President", when used with respect to the Company or
the Trustee, means any vice president, whether or not designated by a number
or a word or words added before or after the title "vice president".
"Written Action" when used with respect to the Preferred
Securities of any series, means a written action of the Managing Members
pursuant to the L.L.C. Agreement, establishing the terms of the Preferred
Securities of such series.
Section 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the
Trustee to take any action under any provision of this Indenture, the Company
shall furnish to the Trustee such certificates and opinions as may be required
under the Trust Indenture Act. Each such certificate or opinion shall be
given in the form of an Officers' Certificate, if to be given by an officer of
the Company, or an Opinion of Counsel, if to be given by counsel, and shall
comply with the requirements of the Trust Indenture Act and any other
requirements set forth in this Indenture.
Every certificate or opinion with respect to compliance with
a condition or covenant provided for in this Indenture (excluding certificates
provided for in Section 1004) shall include
(1) a statement that each individual signing such
certificate or opinion has read such covenant or condition and the
definitions herein relating thereto;
(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 each such
individual, such individual has made such examination or
investigation as is necessary to enable such individual to express
an informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be
certified by, or covered by an opinion of, any specified Person, it is not
necessary that all such matters be certified by, or covered by the opinion of,
only one such Person, or that they be so certified or covered by only one
document, but one such Person may certify or give an opinion with respect to
some matters and one or more other such Persons as to other matters, and any
such Person may certify or give an opinion as to such matters in one or several
documents.
Any certificate or opinion of an officer of the Company may
be based, insofar as it relates to legal matters, upon a certificate or
opinion of, or representations by, counsel, unless such officer knows, or in
the exercise of reasonable care should know, that the certificate or opinion
or representations with respect to the matters upon which its certificate or
opinion is based are erroneous. Any such certificate or opinion of counsel
may be based, insofar as it relates to factual matters, upon a certificate or
opinion of, or representations by, an officer or officers of the Company
stating that the information with respect to such factual matters is in the
possession of the Company, unless such counsel knows, or in the exercise of
reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Any certificate, statement or opinion of an officer of the
Company or of counsel may be based, insofar as it relates to accounting
matters, upon a certificate, opinion or representation by an accountant or
firm of accountants in the employ of the Company, unless such officer or
counsel, as the case may be, knows, or in the exercise of reasonable care
should know, that the certificate, opinion or representation with respect to
such accounting matters upon which its certificate, statement or opinion may
be based is erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be
consolidated and form one instrument.
Section 104. Acts of Holders; Record Dates.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by agent duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments are delivered to the Trustee and, where it is hereby expressly
required, to the Company. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent
shall be sufficient for any purpose of this Indenture and (subject to Section
601) conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual
signing such instrument or writing acknowledged to him or her the execution
thereof. Where such execution is by a signer acting in a capacity other than
such signer's individual capacity, such certificate or affidavit shall also
constitute sufficient proof of such signer's authority. The fact and date of
the execution of any such instrument or writing, or the authority of the
Person executing the same, may also be proved in any other manner which the
Trustee deems sufficient.
(c) The Company may, in the circumstances permitted by the
Trust Indenture Act, fix any day as the record date for the purpose of
determining the Holders of Outstanding Debentures of any series entitled to
give or take any request, demand, authorization, direction, notice, consent,
waiver or other action, or to vote on any action, authorized or permitted to
be given or taken by Holders of Outstanding Debentures of such series. If not
set by the Company prior to the first solicitation of a Holder of Debentures
of such series made by any Person in respect of any such action, or, in the
case of any such vote, prior to such vote, the record date for any such action
or vote shall be the 30th day (or, if later, the date of the most recent list
of Holders required to be provided pursuant to Section 701) prior to such
first solicitation or vote, as the case may be. With regard to any record
date for action to be taken by the Holders of one or more series of
Debentures, only the Holders of Debentures of such series on such date (or
their duly designated proxies) shall be entitled to give or take, or vote on,
the relevant action.
(d) The ownership of Debentures shall be proved by the
Debenture Register or by a certificate of the Debenture Registrar.
(e) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Debenture shall bind every
future Holder of the same Debenture and the Holder of every Debenture issued
upon the registration of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done, omitted or suffered to be done by the
Trustee or the Company in reliance thereon, whether or not notation of such
action is made upon such Debenture.
(f) Without limiting the foregoing, a Holder entitled
hereunder to give or take any action hereunder with regard to any particular
Debenture may do so with regard to all or any part of the principal amount of
such Debenture or by one or more duly appointed agents each of which may do so
pursuant to such appointment with regard to all or any different part of such
principal amount.
Section 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice,
consent, waiver or Act of Holders or other document provided or permitted by
this Indenture to be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be
sufficient for every purpose hereunder if made, given, furnished
or filed in writing to or with the Trustee at its Corporate Trust
Office, Attention: Steven Wagner, or
(2) the Company by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage
prepaid, to the Company addressed to it at the address of its
principal office specified in the first paragraph of this
instrument, Attention: Senior Vice President - Finance, or at any
other address previously furnished in writing to the Trustee by
the Company.
Section 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any
event, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid, to
each Holder affected by such event, at its address as it appears in the
Debenture Register, not later than the latest date (if any), and not earlier
than the earliest date (if any), prescribed for the giving of such notice;
provided, however, that the Company or the Trustee, upon a good faith
determination that mailing is in the circumstances impractical, may give such
notice by any other method which, in the reasonable belief of the Company or,
in the case of the Trustee, of the Company and the Trustee, is likely to be
received by the Holders. In any case where notice to Holders is given by
mail, neither the failure to mail such notice, nor any defect in any notice so
mailed, to any particular Holder shall affect the sufficiency of such notice
with respect to other Holders. Where this Indenture provides for notice in
any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall be filed
with the Trustee, but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service
or by reason of any other cause it shall be impracticable to give such notice
by mail, then such notification as shall be made with the approval of the
Trustee shall constitute a sufficient notification for every purpose hereunder.
Section 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with
a provision of the Trust Indenture Act that is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act that may be so modified or excluded, the latter provision shall
be deemed to apply to this Indenture as so modified or to be excluded, as the
case may be.
Section 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
Section 109. Successors and Assigns.
All covenants and agreements in this Indenture by the
Company shall bind its successors and assigns, whether so expressed or not.
Section 110. Separability Clause.
In case any provision in this Indenture or in the Debentures
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 111. Benefits of Indenture.
Nothing in this Indenture or in the Debentures, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder and the Holders and, to the extent specifically set forth
herein, the holders of Senior Debt and Preferred Securities, any benefit or
any legal or equitable right, remedy or claim under this Indenture.
Section 112. Governing Law.
This Indenture and the Debentures shall be governed by and
construed in accordance with the laws of the State of New York, but without
regard to principles of conflicts of laws.
Section 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date
or Stated Maturity of any Debenture shall not be a Business Day, then
(notwithstanding any other provision of this Indenture or of the Debentures
(other than a provision of the Debentures of any series which specifically
states that such provision shall apply in lieu of this Section)) payment of
interest or principal (and premium, if any) need not be made on such date, but
may be made on the next succeeding Business Day (and no interest shall accrue
with respect to such payment for the period from and after such Interest
Payment Date, Redemption Date or Stated Maturity, as the case may be), except
that, if such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such Interest Payment Date or
Redemption Date, or at the Stated Maturity, as the case may be.
Section 114. Personal Immunity from Liability for Incorporators,
Stockholders, Etc.
No recourse shall be had for the payment of the principal of
or premium, if any, or interest, if any, on any Debenture, or for any claim
based thereon, or otherwise in respect of any Debenture, or based on or in
respect of this Indenture or any indenture supplemental hereto, against any
incorporator, or against any past, present or future stockholder, director or
officer, as such, of the Company or of any successor corporation, 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 expressly
waived and released as a condition of, and as consideration for, the execution
of this Indenture and the issue of the Debentures.
ARTICLE TWO
Debenture Form
Section 201. Forms Generally.
The Debentures of each series shall be in substantially the
form set forth in this Article, or in such other form as shall be established
by or pursuant to a Board Resolution or in one or more indentures supplemental
hereto, in each case with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture, and may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as may be required to comply
with the rules of any securities exchange or as may, consistent herewith, be
determined by the officers executing such Debentures, as evidenced by their
execution of the Debentures. If the form of Debentures of any series is
established by action taken pursuant to a Board Resolution, a copy of an
appropriate record of such action shall be certified by the Corporate
Secretary or an Assistant Corporate Secretary of the Company and delivered to
the Trustee at or prior to the delivery of the Company Order contemplated by
Section 303 for the authentication and delivery of such Debentures.
The definitive Debentures shall be printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner, all
as determined by the officers executing such Debentures, as evidenced by their
execution of such Debentures.
Section 202. Form of Face of Debenture.
[Insert any legend required by the Internal Revenue Code and
the regulations thereunder.]
AETNA LIFE AND CASUALTY COMPANY
No. $
AETNA LIFE AND CASUALTY COMPANY, a Connecticut insurance
corporation (herein called the "Company", which term includes any successor
Person under the Indenture hereinafter referred to), for value received, hereby
promises to pay to , or registered
assigns, the principal sum of Dollars on , and to pay
interest thereon [if the Security is to bear interest at a fixed rate, insert
- - -- the rate of ....% per annum [if the Security is a Floating or Adjustable
Rate Security, insert -- a rate per annum [computed-determined] in accordance
with the [insert defined name of Floating or Adjustable Rate Provision] set
forth below] plus Additional Interest, if any, accruing from or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for and (to the extent that the payment of such interest shall be
legally enforceable) at the rate of % per annum on any overdue principal
and premium and on any overdue instalment of interest or Additional Interest.
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in such Indenture, be paid to the
Person in whose name this Debenture (or one or more Predecessor Debentures) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the or (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date. Any such
interest not so punctually paid or duly provided for will forthwith cease to
be payable to the Holder on such Regular Record Date and may either be paid to
the Person in whose name this Debenture (or one or more Predecessor
Debentures) is registered at the close of business on a Special Record Date
for the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of Debentures of this series not less than
10 days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities
exchange on which the Debentures of this series may be listed, and upon such
notice as may be required by such exchange, all as more fully provided in said
Indenture.
The indebtedness evidenced by this Debenture is, to the
extent provided in the Indenture, subordinate and subject in right of payment
to the prior payment in full of all Senior Debt, and this Debenture is issued
subject to the provisions of the Indenture with respect thereto. Each Holder
of this Debenture, by accepting the same, (a) agrees to and shall be bound by
such provisions, (b) authorizes and directs the Trustee on his behalf to take
such action as may be necessary or appropriate to effectuate the subordination
so provided and (c) appoints the Trustee his attorney-in-fact for any and all
such purposes.
[If the Securities are Floating or Adjustable Rate
Securities with respect to which the principal of or any premium or interest
may be determined with reference to an index, insert the text of the Floating
or Adjustable Rate Provision.]
Payment of the principal of (and premium, if any) and
interest on this Debenture will be made at the office or agency of the Company
maintained for that purpose in , in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts; provided, however, that at the option of the
Company payment of interest may be made by check mailed to the address of the
Person entitled thereto as such address shall appear in the Debenture
Register. Notwithstanding the foregoing, so long as the Holder of this
Debenture is Capital, the payment of the principal of (and premium, if any)
and interest (including Additional Interest, if any) on this Debenture will be
made at such place and to such account as may be designated by Capital.
Reference is hereby made to the further provisions of this
Debenture set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Debenture shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument
to be duly executed under its corporate seal.
Dated:
AETNA LIFE AND CASUALTY
COMPANY
By______________________
Attest:
Section 203. Form of Reverse of Debenture.
This Debenture is one of a duly authorized issue of
securities of the Company (herein called the "Debentures), issued and to be
issued in one or more series under an Indenture, dated as of November 1, 1994
(herein called the "Indenture"), between the Company and The First National
Bank of Chicago, as Trustee (herein called the "Trustee", which term includes
any successor trustee under the Indenture), to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of
the respective rights, limitations of rights, duties and immunities thereunder
of the Company, the Trustee and the Holders of the Debentures and, to the
extent specifically set forth in the Indenture, the holders of Senior Debt and
Preferred Securities, and of the terms upon which the Debentures are, and are
to be, authenticated and delivered. This Debenture is one of the series
designated on the face hereof, limited in aggregate principal amount to $
.
[If the Debentures are subject to redemption, insert the
terms upon which such Debentures may be redeemed.]
[If applicable, insert the following: In the event of
redemption of this Debenture in part only, a new Debenture or Debentures of
this series and of like tenor for the unredeemed portion hereof will be issued
in the name of the Holder hereof upon the cancellation hereof.]
The Indenture contains provisions for defeasance at any time
of (1) the entire indebtedness of this Debenture or (2) certain restrictive
covenants and Events of Default with respect to this Debenture, in each case
upon compliance with certain conditions set forth in the Indenture.
If an Event of Default with respect to Debentures of this
series shall occur and be continuing, the principal of the Debentures of this
series and accrued interest thereon (including Additional Interest, if any)
may be declared due and payable in the manner and with the effect provided in
the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Debentures of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of not less than a majority in
aggregate principal amount of the Debentures at the time Outstanding of each
series to be affected (and, prior to a Security Exchange with respect to the
Debentures of any series affected thereby, the consent of the holders of not
less than a majority in stated liquidation preference of the Preferred
Securities of the related series). The Indenture also contains provisions
permitting the Holders of specified percentages in principal amount of the
Debentures of each series at the time Outstanding, on behalf of the Holders of
all Debentures of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences (except that prior to a Security Exchange with respect to
the Debentures of such series, any such waiver will also require the consent
of the holders of specified percentages of the stated liquidation preference
of the Preferred Securities of the related series). Any such consent or
waiver by the Holder of this Debenture shall be conclusive and binding upon
such Holder and upon all future Holders of this Debenture and of any Debenture
issued upon the registration of transfer hereof or in exchange hereof or in
lieu hereof, whether or not notation of such consent or waiver is made upon
this Debenture.
Subject to Section 1503 of the Indenture, no reference
herein to the Indenture (other than such Section) and no provision of this
Debenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium and
interest on this Debenture at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Debenture is registerable
in the Debenture Register, upon surrender of this Debenture for registration
of transfer at the office or agency of the Company in any place where the
principal of and any premium and interest on this Debenture are payable, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Debenture Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Debentures of this series and of like tenor, of authorized
denominations and for the same aggregate principal amount, will be issued to
the designated transferee or transferees; provided that prior to a Security
Exchange with respect to the Debentures of this series, the Debentures of this
series may not be transferred without the written consent of the Company.
The Debentures of this series are issuable only in
registered form without coupons in denominations of $25.00 and any integral
multiple thereof. As provided in the Indenture and subject to certain
limitations therein set forth, Debentures of this series are exchangeable for
a like aggregate principal amount of Debentures of this series and of like
tenor of a different authorized denomination, as requested by the Holder
surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Debenture for registration
of transfer, the Company, the Trustee and any agent of the Company or the
Trustee may treat the Person in whose name this Debenture is registered as the
owner hereof for all purposes, whether or not this Debenture is overdue, and
neither the Company, the Trustee nor any such agent shall be affected by
notice to the contrary.
No recourse shall be had for the payment of the principal of
(and premium, if any) or interest (including Additional Interest, if any) on
this Debenture, or for any claim based hereon, or otherwise in respect hereof,
or based on or in respect of the Indenture or any indenture supplemental
thereto, against any incorporator, stockholder, officer or director, as such,
past, present or future, of the Company or of any successor corporation,
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 issue
hereof, expressly waived and released.
All terms used in this Debenture which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
Section 204. Form of Legend for Global Debentures.
Every Global Debenture authenticated and delivered hereunder
shall bear a legend in substantially the following form or such other legends
as may be required:
This Debenture is a Global Debenture within the meaning of the
Indenture hereinafter referred to and is registered in the name of
a Depositary or a nominee thereof. This Debenture may not be
transferred to, or registered or exchanged for Debentures
registered in the name of, any Person other than the Depositary or
a nominee thereof and no such transfer may be registered, except
in the limited circumstances described in the Indenture. Every
Debenture authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, this Debenture
shall be a Global Debenture subject to the foregoing, except in
such limited circumstances.
Section 205. Form of Trustee's Certificate of Authentication.
The Trustee's certificate of authentication shall be in
substantially the following form:
This is one of the Debentures of the series designated
therein referred to in the within-mentioned Indenture.
.............................,
As Trustee
By...........................
Authorized Officer
ARTICLE THREE
The Debentures
Section 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Debentures which may be
authenticated and delivered under this Indenture is unlimited.
The Debentures may be issued in one or more series. There
shall be established in or pursuant to a Board Resolution or established in
one or more indentures supplemental hereto, prior to the issuance of
Debentures of any series,
(1) the title of the Debentures of the series (which shall
distinguish the Debentures of the series from Debentures of any
other series);
(2) any limit upon the aggregate principal amount of the
Debentures of the series which may be authenticated and delivered
under this Indenture (except for Debentures authenticated and
delivered upon registration of transfer of, or in exchange for, or
in lieu of, other Debentures of the series pursuant to Sections
304, 305, 306, 906 or 1107 and except for any Debentures which,
pursuant to Section 303, are deemed never to have been
authenticated and delivered hereunder);
(3) the Person to whom any interest on a Debenture of the
series shall be payable, if other than the Person in whose name
that Debenture (or one or more Predecessor Debentures) is
registered at the close of business on the Regular Record Date for
such interest;
(4) the date or dates on which the principal of the
Debentures of the series is payable;
(5) the rate or rates at which the Debentures of the series
shall bear interest, if any, or the Floating or Adjustable Rate
Provision pursuant to which such rates shall be determined, the
date or dates from which such interest shall accrue, the Interest
Payment Dates on which any such interest shall be payable and the
Regular Record Date for any interest payable on any Interest
Payment Date;
(6) the place or places where the principal of and any
premium and interest on Debentures of the series shall be payable;
(7) the period or periods within which, the price or prices
at which (including premium, if any) and the terms and conditions
upon which Debentures of the series may or are required to be
redeemed or prepaid, in whole or in part, at the option of the
Company pursuant to a sinking fund or otherwise;
(8) the obligation, if any, of the Company to redeem or
purchase Debentures of the series pursuant to any sinking fund or
analogous provisions or at the option of a Holder thereof and the
period or periods within which, the price or prices at which and
the terms and conditions upon which Debentures of the series shall
be redeemed or purchased, in whole or in part, pursuant to such
obligation;
(9) if other than denominations of $25.00 and any integral
multiple thereof, the denominations in which Debentures of the
series shall be issuable;
(10) the ability of the Company, if any, to reborrow the
proceeds from any redemption or repayment of the Debentures of
that series or to exchange any Debentures of that series for
Debentures of a different series;
(11) the ability of the Company, if any, to extend the
interest payment period for the Debentures of the series;
(12) if the amount of payments of principal of or any premium
or interest on any Debentures of the series may be determined with
reference to one or more indices, the manner in which such amounts
shall be determined;
(13) if and as applicable, that the Debentures of the series
shall be issuable in whole or in part in the form of one or more
Global Debentures and, in such case, the Depositary or
Depositaries for such Global Debenture or Global Debentures and any
circumstance other than those set forth in Section 305 in which
any such Global Debenture may be transferred to, and registered
and exchanged for Debentures registered in the name of, a Person
other than the Depositary for such Global Debenture or a nominee
thereof and in which any such transfer may be registered;
(14) any other event or events of default applicable with
respect to the Debentures of the series in addition to those
provided in Section 501;
(15) any other covenant or warranty included for the benefit
of Debentures of the series in addition to (and not inconsistent
with) those included in this Indenture for the benefit of
Debentures of all series, or any other covenant or warranty
included for the benefit of Debentures of the series in lieu of
any covenant or warranty included in this Indenture for the
benefit of Debentures of all series, or any provision that any
covenant or warranty included in this Indenture for the benefit of
Debentures of all series shall not be for the benefit of
Debentures of the series, or any combination of such covenants,
warranties or provisions;
(16) any restriction or condition on the transferability of
the Debentures of the series;
(17) any authenticating or paying agents, registrars or
any other agents with respect to the Debentures of the series; and
(18) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture, except as
permitted by Section 901(5)).
All Debentures of any one series shall be substantially
identical except as to denomination and except as may otherwise be provided in
or pursuant to the Board Resolution referred to above or in any such indenture
supplemental hereto.
If any of the terms of the series are established by action
taken pursuant to a Board Resolution, a copy of such action shall be delivered
to the Trustee.
Section 302. Denominations.
The Debentures of each series shall be issuable in
registered form without coupons in such denominations as shall be specified as
contemplated by Section 301. In the absence of any such provisions with
respect to the Debentures of any series, the Debentures of such series shall
be issuable in denominations of $25.00 and any integral multiple thereof.
Section 303. Execution, Authentication, Delivery and Dating.
The Debentures shall be executed on behalf of the Company by
its Chairman, a Vice Chairman, its President, any Group Executive, any Vice
President, its Treasurer or Assistant Treasurer, under its corporate seal
reproduced thereon attested by its Corporate Secretary or one of its Assistant
Corporate Secretaries. The signature of any of these officers on the
Debentures may be manual or facsimile.
The seal of the Company may be in the form of a facsimile
thereof and may be impressed, affixed, imprinted or otherwise reproduced on
the Debentures. Debentures bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased
to hold such offices prior to the authentication and delivery of such
Debentures or did not hold such offices at the date of such Debentures. Minor
typographical and other minor errors in the text of any Debenture or minor
defects in the seal or facsimile signature on any Debenture shall not affect
the validity or enforceability of such Debenture if it has been duly
authenticated and delivered by the Trustee.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Debentures of any series
executed by the Company to the Trustee for authentication, together with a
Company Order for the authentication and delivery of such Debentures, and the
Trustee in accordance with the Company Order shall authenticate and deliver
such Debentures. If the form or terms of the Debentures of the series have
been established in or pursuant to one or more Board Resolutions as permitted
by Sections 201 and 301, in authenticating such Debentures, and accepting the
additional responsibilities under this Indenture in relation to such
Debentures, the Trustee shall be entitled to receive, and (subject to Section
601) shall be fully protected in relying upon, an Opinion of Counsel stating,
(a) if the form of such Debentures has been established by
or pursuant to Board Resolution as permitted by Section 201, that
such form has been established in conformity with the provisions
of this Indenture;
(b) if the terms of such Debentures have been established
by or pursuant to Board Resolution as permitted by Section 301,
that such terms have been established in conformity with the
provisions of this Indenture; and
(c) that such Debentures, when authenticated and delivered
by the Trustee and issued by the Company in the manner and subject
to any conditions specified in such Opinion of Counsel, will
constitute valid and legally binding obligations of the Company
enforceable in accordance with their terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting
creditors' rights generally or the rights of creditors of
insurance companies generally and to general equity principles.
The Trustee shall have the right to decline to authenticate
and deliver any Debentures under this Section if the Trustee, being advised by
counsel, determines that such action may not lawfully be taken or if the
Trustee in good faith by its board of directors, executive committee, or a
trust committee of directors or responsible officers of the Trustee shall
determine that such action would expose the Trustee to personal liability to
existing Holders of Debentures.
Notwithstanding the provisions of Section 301 and of the
preceding paragraph, if all Debentures of a series are not to be originally
issued at one time, it shall not be necessary to deliver the Board Resolution
otherwise required pursuant to Section 301 or the Company Order and Opinion of
Counsel otherwise required pursuant to such preceding paragraph at or prior to
the time of authentication of each Debenture of such series if such documents
are delivered at or prior to the authentication upon original issuance of the
first Debenture of such series to be issued.
Each Debenture shall be dated the date of its authentication.
No Debenture shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on
such Debenture a certificate of authentication substantially in the form
provided for herein executed by the Trustee by manual signature, and such
certificate upon any Debenture shall be conclusive evidence, and the only
evidence, that such Debenture has been duly authenticated and delivered
hereunder. Notwithstanding the foregoing, if any Debenture shall have been
authenticated and delivered hereunder but never issued and sold by the
Company, and the Company shall deliver such Debenture to the Trustee for
cancellation as provided in Section 309, for all purposes of this Indenture
such Debenture shall be deemed never to have been authenticated and delivered
hereunder and shall never be entitled to the benefits of this Indenture.
Section 304. Temporary Debentures.
Pending the preparation of definitive Debentures of any
series, the Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Debentures which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any
authorized denomination, substantially of the tenor of the definitive
Debentures in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the officers
executing such Debentures may determine, as evidenced by their execution of
such Debentures.
If temporary Debentures of any series are issued, the
Company will cause definitive Debentures of that series to be prepared without
unreasonable delay. After the preparation of definitive Debentures of such
series, the temporary Debentures of such series shall be exchangeable for
definitive Debentures of such series upon surrender of the temporary
Debentures of such series at the office or agency of the Company in a Place of
Payment for that series, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Debentures of any series, the
Company shall execute and the Trustee shall authenticate and deliver in
exchange therefor one or more definitive Debentures of the same series, of any
authorized denominations and of a like aggregate principal amount and tenor.
Until so exchanged the temporary Debentures of any series shall in all
respects be entitled to the same benefits under this Indenture as definitive
Debentures of such series and tenor.
Section 305. Registration, Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust
Office of the Trustee a register (the register maintained in such office and
in any other office or agency of the Company in a Place of Payment being herein
sometimes collectively referred to as the "Debenture Register") in which,
subject to such reasonable regulations as it or the Trustee may prescribe, the
Company shall provide for the registration of Debentures and of transfers of
Debentures. The Trustee is hereby appointed "Debenture Registrar" for the
purpose of registering Debentures and transfers of Debentures as herein
provided.
Upon surrender for registration of transfer of any Debenture
of any series at the office or agency in a Place of Payment for that series,
the Company shall execute, and the Trustee shall authenticate and deliver, in
the name of the designated transferee or transferees, one or more new
Debentures of the same series, of any authorized denominations and of a like
aggregate principal amount and tenor; provided that prior to a Security
Exchange with respect to the Debentures of such series, the Debentures of such
series may not be transferred without the written consent of the Company.
At the option of the Holder, Debentures of any series may be
exchanged for other Debentures of the same series, of any authorized
denominations and of a like aggregate principal amount and tenor, upon
surrender of the Debentures to be exchanged at such office or agency.
Whenever any Debentures are so surrendered for exchange, the Company shall
execute, and the Trustee shall authenticate and deliver, the Debentures which
the Holder making the exchange is entitled to receive.
All Debentures issued upon any registration of transfer or
exchange of Debentures shall be the valid obligations of the Company,
evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Debentures surrendered upon such registration of transfer or
exchange.
Every Debenture presented or surrendered for registration of
transfer, exchange, redemption or payment shall (if so required by the Company
or the Trustee) be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Company and the Debenture Registrar duly
executed, by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange of Debentures, but the Company or the Trustee may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any registration of transfer or exchange of
Debentures, other than exchanges pursuant to Section 304, 906 or 1107 not
involving any transfer.
Unless otherwise required by the rules of any stock exchange
on which the Debentures are listed or of any quotation system through which
the Debentures are traded, neither the Company nor the Trustee shall be
required (i) to issue, register the transfer of or exchange Debentures of any
series during a period beginning at the opening of business 15 days before the
day of the mailing of a notice of redemption of Debentures of that series
selected for redemption under Section 1103 and ending at the close of business
on the day of such mailing, or (ii) to register the transfer of or exchange
any Debenture so selected for redemption in whole or in part, except the
unredeemed portion of any Debenture being redeemed in part.
Notwithstanding any other provision in this Indenture, no
Global Debenture may be transferred to, or registered or exchanged for
Debentures registered in the name of, any Person other than the Depositary for
such Global Debenture or any nominee thereof, and no such transfer may be
registered, unless (1) such Depositary (A) notifies the Company and the
Trustee that it is unwilling or unable to continue as Depositary for such
Global Debenture or (B) ceases to be a clearing agency registered under the
Exchange Act, (2) the Company executes and delivers to the Trustee a Company
Order that such Global Debenture shall be so transferable, registrable and
exchangeable, and such transfers shall be registrable, (3) there shall have
occurred and be continuing an Event of Default with respect to the Debentures
evidenced by such Global Debenture or (4) there shall exist such other
circumstances, if any, as have been specified for this purpose as contemplated
by Section 301. Notwithstanding any other provision in this Indenture, a
Global Debenture to which the restriction set forth in the preceding sentence
shall have ceased to apply may be transferred only to, and may be registered
and exchanged for Debentures registered only in the name or names of, such
Person or Persons as the Depositary for such Global Debenture shall have
directed and no transfer thereof other than such a transfer may be registered.
Every Debenture authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global
Debenture to which the restriction set forth in the first sentence of the
preceding paragraph shall apply, whether pursuant to this Section, Section
304, 306, 906 or 1107 or otherwise, shall be authenticated and delivered in
the form of, and shall be, a Global Debenture.
Section 306. Mutilated, Destroyed, Lost and Stolen Debentures.
If there shall be delivered to the Company and the Trustee
(i) a mutilated Debenture or (ii) evidence to their satisfaction of the
destruction, loss or theft of any Debenture and in either case such security
or indemnity as may be required by either of them to save each of them and any
agent of either of them harmless, then, in the absence of notice to the
Company or the Trustee that such Debenture has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall authenticate and
deliver, in lieu of any such mutilated, destroyed, lost or stolen Debenture, a
new Debenture of the same series and of like tenor and principal amount and
bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen
Debenture has become or is about to become due and payable, the Company in its
discretion may, instead of issuing a new Debenture, pay such Debenture.
Upon the issuance of any new Debenture under this Section,
the Company or the Trustee may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Trustee)
connected therewith.
Every new Debenture of any series issued pursuant to this
Section in lieu of any destroyed, lost or stolen Debenture shall constitute an
original additional contractual obligation of the Company, whether or not the
destroyed, lost or stolen Debenture shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally
and proportionately with any and all other Debentures of that series 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 or payment of mutilated, destroyed, lost or stolen Debentures.
Section 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise provided as contemplated by Section 301
with respect to any series of Debentures, interest on any Debenture which is
payable, and is punctually paid or duly provided for, on any Interest Payment
Date shall be paid to the Person in whose name that Debenture (or one or more
Predecessor Debentures) is registered at the close of business on the Regular
Record Date for such interest.
Any interest on any Debenture of any series which 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 by virtue of having
been such Holder, and such Defaulted Interest may be paid by the Company, at
its election in each case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Debentures of such
series (or their respective Predecessor Debentures) are registered
at the close of business on a Special Record Date for the payment
of such Defaulted Interest, which shall be fixed in the following
manner. The Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on each Debenture
of such series and the date of the proposed payment, and at the
same time the Company shall deposit with the Trustee an amount of
money equal to the aggregate amount proposed to be paid in respect
of such Defaulted Interest or shall make arrangements satisfactory
to the Trustee for such deposit prior to the date of the proposed
payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in
this Clause provided. Thereupon the Trustee shall fix a Special
Record Date for the payment of such Defaulted Interest which shall
be not more than 15 days and not less than 10 days prior to the
date of the proposed payment and not less than 15 days after the
receipt by the Trustee of the notice of the proposed payment. The
Trustee shall promptly notify the Company of such Special Record
Date and, in the name and 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 Holder of Debentures of such series at
its address as it appears in the Debenture 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 so mailed, such Defaulted Interest shall be
paid to the Persons in whose names the Debentures of such series
(or their respective Predecessor Debentures) are registered at the
close of business on such Special Record Date and shall no longer
be payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest
on the Debentures of any series in any other lawful manner not
inconsistent with the requirements of any securities exchange on
which such Debentures may be listed, and upon such notice as may be
required by such exchange, if, after notice given by the Company
to the Trustee of the proposed payment pursuant to this Clause,
such manner of payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each
Debenture delivered under this Indenture upon registration of transfer of or
in exchange for or in lieu of any other Debenture shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Debenture.
Section 308. Persons Deemed Owners.
Prior to due presentment of a Debenture for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name such Debenture is registered as the owner
of such Debenture for the purpose of receiving payment of principal of and any
premium and (subject to Section 307) any interest on such Debenture and for
all other purposes whatsoever, whether or not such Debenture be overdue, and
neither the Company, the Trustee nor any agent of the Company or the Trustee
shall be affected by notice to the contrary.
Section 309. Cancellation.
All Debentures surrendered for payment, redemption,
registration of transfer or exchange or for credit against any sinking fund
payment shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee and shall be promptly cancelled by it. The Company
may at any time deliver to the Trustee for cancellation any Debentures
previously authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever, and may deliver to the Trustee (or to any
other Person for delivery to the Trustee) for cancellation any Debentures
previously authenticated hereunder which the Company has not issued and sold,
and all Debentures so delivered shall be promptly cancelled by the Trustee.
No Debentures shall be authenticated in lieu of or in exchange for any
Debentures cancelled as provided in this Section, except as expressly
permitted by this Indenture. All cancelled Debentures held by the Trustee
shall be disposed of as directed by a Company Order. Acquisition by the
Company of any Debenture shall not operate as a redemption or satisfaction of
the indebtedness represented by such Debenture unless and until the same is
delivered to the Trustee for cancellation.
Section 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301
for Debentures of any series, interest on the Debentures of each series shall
be computed on the basis of a 360-day year of twelve 30-day months and, for
any period shorter than a full monthly period, shall be computed on the basis
of the actual number of days elapsed in such period.
Section 311. Additional Interest.
Except as otherwise provided as contemplated by Section 301
with respect to any series of Debentures, if at any time prior to a Security
Exchange with respect to such series of Debentures, (i) Capital shall be
required to pay any Additional Amounts with respect to the related series of
Preferred Securities or (ii) Capital shall be required to pay, with respect to
its income derived from the interest payments on such series of Debentures,
any amounts for or on account of any taxes, duties, assessments or governmental
charges of whatever nature imposed by the United States, or any other taxing
authority, then, in any such case, the Company will pay as interest such
additional amounts ("Additional Interest") as may be necessary in order that
the net amounts received and retained by Capital after paying such Additional
Amounts or after the payment of such taxes, duties, assessments or
governmental charges shall result in Capital's having such funds as it would
have had in the absence of the payment of such taxes, duties, assessments or
governmental charges.
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of
further effect (except as to any surviving rights of registration of transfer
or exchange of Debentures of a series herein expressly provided for) with
respect to Debentures of any series, and the Trustee, at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture with respect to a series, when
(1) either
(A) all Debentures of such series theretofore authenticated
and delivered (other than (i) Debentures which have been
destroyed, lost or stolen and which have been replaced or paid as
provided in Section 306 and (ii) Debentures of such series for
whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter repaid
to the Company or discharged from such trust, as provided in
Section 1003) have been delivered to the Trustee for cancellation;
or
(B) all such Debentures of such series not theretofore
delivered to the Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated
Maturity within one year, or
(iii) are to be called for redemption within one year
under arrangements satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the name,
and at the expense, of the Company,
and the Company, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee in trust for
the purpose (A) money in an amount, or (B) U.S. Government
Obligations that through the scheduled payment of principal and
interest 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 (C) a combination thereof,
sufficient to pay and discharge the entire indebtedness on such
Debentures of such series not theretofore delivered to the Trustee
for cancellation, for principal of (and premium, if any) and
interest to the date of such deposit (in the case of Debentures of
such series which have become due and payable) or to the Stated
Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other
sums payable hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture with respect to such
series have been complied with.
In the event there are Debentures of two or more series
outstanding hereunder, the Trustee shall be required to execute an instrument
acknowledging satisfaction and discharge of this Indenture only if requested
to do so with respect to Debentures of a particular series as to which it is
Trustee and if the other conditions thereto are met. In the event that there
are two or more Trustees hereunder, then the effectiveness of any such
instrument shall be conditioned upon receipt of such instruments from all
Trustees hereunder.
Notwithstanding the satisfaction and discharge of this
Indenture with respect to a particular series, the obligations of the Company
to the Trustee under Section 607, the obligations of the Trustee to any
Authenticating Agent under Section 614 and, if money shall have been deposited
with the Trustee pursuant to subclause (B) of Clause (1) of this Section, the
obligations of the Trustee under Section 402 and the last paragraph of Section
1003 shall survive until there are no Debentures Outstanding with respect to a
particular series and the obligations of the Company and the Trustee with
respect to all other series of Debentures shall survive.
Section 402. Application of Trust Fund.
Subject to provisions of the last paragraph of Section 1003,
all amounts deposited with the Trustee pursuant to Section 401 shall be held
in trust and applied by it, in accordance with the provisions of the Debentures
and this Indenture, to the payment, either directly or through any Paying
Agent (including the Company acting as its own Paying Agent) as the Trustee
may determine, to the Persons entitled thereto, of the principal and any
premium and interest for whose payment such funds have been deposited with the
Trustee. Money deposited pursuant to this section not in violation of this
Indenture shall not be subject to claims of the holders of Senior Debt under
Article Fourteen.
ARTICLE FIVE
Remedies
Section 501. Events of Default.
"Event of Default" whenever used with respect to Debentures
of a series means any one of the following events and such other events as may
be established with respect to the Debentures of such series as contemplated
by Section 301 hereof (whether or not it shall be occasioned by the provisions
of Article Fourteen):
(1) Default in the payment of any instalment of interest
(including any Additional Interest) upon any Debentures issued
under this Indenture as and when the same shall become due and
payable, and continuance of such default for a period of 10 days,
in the event such default occurs prior to a Security Exchange with
respect to Debentures of such series, and 30 days, in the event
such default occurs on or after such a Security Exchange; provided
that a valid extension of the interest payment period by the
Company for any Debentures shall not constitute a default in the
payment of interest for this purpose; or
(2) Default in the payment of the principal of or premium,
if any, on any Debentures issued under this Indenture as and when
the same shall become due and payable either at maturity, upon
redemption, by declaration or otherwise; or
(3) Failure on the part of the Company duly to observe or
perform in any material respect any other of the covenants or
agreements on the part of the Company contained in this Indenture
for the benefit of the holders of Debentures of such series and
written notice of such failure, stating that such notice is a
"Notice of Default" hereunder, and requiring the Company to remedy
the same, shall have been given by registered or certified mail,
return receipt requested, to the Company by the Trustee, or to the
Company and the Trustee by the holders of at least 25% in
aggregate principal amount of the Outstanding Debentures of such
series or, prior to a Security Exchange with respect to Debentures
of such series, 25% in aggregate stated liquidation preference of
the related series of Preferred Stock and such failure shall have
continued unremedied for a period of 60 days, in the event such
default occurs prior to a Security Exchange with respect to the
Debentures of such series, and 90 days, in the event such default
occurs after such a Security Exchange, in each case after the date
of the Company's receipt of such Notice of Default; or
(4) A decree or order by a court having jurisdiction in
the premises shall have been entered adjudging the Company a
bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of
the Company under any applicable Federal or State bankruptcy or
similar law, and such decree or order shall have continued
undischarged and unstayed for a period of 90 days; or a decree or
order of a court having jurisdiction in the premises for the
appointment of a receiver, liquidator, trustee, assignee,
sequestrator or similar official in bankruptcy or insolvency of
the Company or of all or substantially all of its property, or for
the winding up or liquidation of its affairs, shall have been
entered, and such decree or order shall have continued
undischarged and unstayed for a period of 90 days; or
(5) The Company shall institute proceedings to be
adjudicated a voluntary bankrupt, or shall consent to the filing
of a bankruptcy proceeding against it, or shall file a petition or
answer or consent seeking reorganization, arrangement, adjustment
or composition under any applicable Federal or State bankruptcy or
similar law, or shall consent to the filing of any such petition,
or shall consent to the appointment of a receiver, liquidator,
trustee, assignee, sequestrator or similar official in bankruptcy
or insolvency of the Company or of all or substantially all of its
property, or shall make an assignment for the benefit of
creditors, or shall admit in writing its inability to pay its
debts generally as they become due and its willingness to be
adjudged a bankrupt, or corporate action shall be taken by the
Company in furtherance of any of the aforesaid purposes.
After a Security Exchange with respect to the Debentures of
any series, upon receipt by the Trustee of any Notice of Default pursuant to
this Section 501 with respect to the Debentures of such series, a record date
shall automatically and without any other action by any Person be set for the
purpose of determining the holders of Outstanding Debentures of such series
entitled to join in such Notice of Default, which record date shall be the
close of business on the day the Trustee receives such Notice of Default. The
Holders of Outstanding Debentures of such series on such record date (or their
duly appointed agents), and only such Persons, shall be entitled to join in
such Notice of Default, whether or not such Holders remain Holders after such
record date; provided that, unless such Notice of Default shall have become
effective by virtue of Holders of at least 25% in principal amount of
Outstanding Debentures of such series on such record date (or their duly
appointed agents) having joined therein on or prior to the 90th day after such
record date, such Notice of Default shall automatically and without any action
by any Person be cancelled and of no further effect. Nothing in this
paragraph shall prevent a Holder (or a duly appointed agent thereof) from
giving, before or after the expiration of such 90-day period, a Notice of
Default contrary to or different from, or, after the expiration of such
period, identical to, a Notice of Default that has been cancelled pursuant to
the proviso to the preceding sentence, in which event a new record date in
respect thereof shall be set pursuant to this paragraph.
Section 502. Acceleration of Maturity.
(a) If an Event of Default with respect to the Debentures
of any series at the time Outstanding occurs and is continuing, then in every
such case the Trustee or the Holders of not less than 25% in principal amount
of the Outstanding Debentures of such series may declare the principal amount
of all of the Debentures of that series to be due and payable immediately, by
a notice in writing to the Company (and to the Trustee if given by Holders),
and upon any such declaration such principal amount and all accrued interest
thereon (including any Additional Interest and any interest subject to an
interest extension election for such Debentures) shall become immediately due
and payable.
At any time after such a declaration of acceleration with
respect to Debentures of any series has been made and before a judgment or
decree for payment of the money due has been obtained by Capital or, after a
Security Exchange with respect to the Debentures of such series, the Trustee
as hereinafter in this Article provided, the Holders of a majority in
principal amount of the Outstanding Debentures of that series (with the
consent of the holders of a majority in stated liquidation preference of the
Preferred Securities of the related series in the event such Preferred
Securities have not been exchanged for such Debentures), by written notice to
the Company and the Trustee, may rescind and annul such declaration and its
consequences if
(1) the Company has paid or deposited with the Trustee a
sum sufficient to pay
(A) all overdue interest (including any Additional
Interest) on all Debentures of that series,
(B) the principal of (and premium, if any, on) any
Debentures of that series which have become due otherwise
than by such declaration of acceleration, any interest
thereon at the rate or rates prescribed therefor in such
Debentures and any Additional Interest,
(C) to the extent that payment of such interest is
lawful, interest upon overdue interest at the rate or rates
prescribed therefor in such Debentures, and
(D) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel except such costs and expenses as are a result of
negligence or bad faith on the part of the Trustee;
and
(2) all Events of Default with respect to Debentures of
that series, other than the non-payment of the principal of and
interest, if any, on the Debentures of that series which have
become due solely by such declaration of acceleration, have been
cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
After a Security Exchange with respect to the Debentures of
any series, upon receipt by the Trustee of any declaration of acceleration, or
any rescission and annulment of any such declaration, pursuant to this Section
502 with respect to Debentures of such series, a record date shall
automatically and without any other action by any Person be set for the
purpose of determining the Holders of Outstanding Debentures of such series
entitled to join in such declaration, or rescission and annulment, as the case
may be, which record date shall be the close of business on the day the
Trustee receives such declaration, or rescission and annulment, as the case
may be. The Holders of Outstanding Debentures of such series on such record
date (or their duly appointed agents), and only such Persons, shall be
entitled to join in such declaration, or rescission and annulment, as the case
may be, whether or not such Holders remain Holders after such record date;
provided that, unless such declaration, or rescission and annulment, as the
case may be, shall have become effective by virtue of Holders of at least 25%,
in the case of any declaration of acceleration, or a majority, in the case of
any rescission or annulment, in principal amount of Outstanding Debentures of
such series on such record date (or their duly appointed agents) having joined
therein on or prior to the 90th day after such record date, such declaration,
or rescission and annulment, as the case may be, shall automatically and
without any action by any Person be cancelled and of no further effect.
Nothing in this paragraph shall prevent a Holder (or a duly appointed agent
thereof) from giving, before or after the expiration of such 90-day period, a
declaration of acceleration, or a rescission and annulment of any such
declaration, contrary to or different from, or, after the expiration of such
period, identical to, a declaration, or rescission and annulment, as the case
may be, that has been cancelled pursuant to the proviso to the preceding
sentence, in which event a new record date in respect thereof shall be set
pursuant to this paragraph.
(b) If, prior to a Security Exchange with respect to the
Debentures of any series, an Event of Default with respect to the Debentures
of such series of a character specified in clause (1) or (2) of Section 501
shall have occurred and be continuing and Capital shall, for any reason, have
failed to pay any dividends on the Preferred Securities of the related series
on any dividend payment date or to pay any portion of the redemption price of
the Preferred Securities of such series called for redemption or any portion
of the full liquidation preference of the Preferred Securities of such series
upon the dissolution of the Company, then any holder of Preferred Securities
of such series may enforce directly against the Company Capital's right
hereunder to receive payments of principal and interest on the Debentures of
such series, but only in an amount sufficient to enable Capital to pay such
dividends, redemption price or liquidation preference, as the case may be.
(c) The Company expressly acknowledges that under the
circumstances set forth in the L.L.C Agreement, the holders of Preferred
Securities have the right to appoint a trustee if an Event of Default has
occurred and is continuing, which trustee shall be authorized to exercise
Capital's rights under this Indenture and the Company agrees to cooperate with
such trustee; provided that any trustee so appointed shall vacate office
immediately in accordance with the L.L.C. Agreement if all Events of Default
giving rise to such right of appointment have been cured by the Company.
In furtherance of the foregoing and without limiting the
powers of any trustee so appointed and for the avoidance of any doubt
concerning the powers of the trustee, the Company acknowledges that any
trustee, in its own name, in the name of Capital, in the name of a member of
Capital and as trustee of an express trust, may institute a proceeding,
including, without limitation, any suit in equity, an action at law or other
judicial or administrative proceeding, to enforce Capital's rights directly
against the Company to the same extent as Capital and on behalf of Capital,
and may prosecute such proceeding to judgment or final decree, and enforce the
same against the Company and collect, out of the property, wherever situated,
of Company the monies adjudged or decreed to be payable in the manner provided
by law.
Section 503. Collection of Indebtedness and Suits for Enforcement
by Trustee.
The Company covenants that if, after a Security Exchange
with respect to the Debentures of any series,
(1) default is made in the payment of any interest on any
Debenture of such series when such interest becomes due and payable
(except for a valid extension of any interest period pursuant to
the terms of the Debentures of such series) and such default
continues for a period of 30 days, or
(2) default is made in the payment of the principal of (or
premium, if any, on) any Debenture of such series at the Maturity
thereof,
the Company will, upon written demand of the Trustee, pay to it, for the
benefit of the Holders of such Debentures, the whole amount then due and
payable on such Debentures for principal and any premium and interest and, to
the extent that payment of such interest shall be legally enforceable,
interest on any overdue principal and premium and on any overdue interest, at
the rate or rates prescribed therefor in such Debentures, and, in addition
thereto, such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel except such
costs and expenses, as are a result of negligence or bad faith on the part of
the Trustee. Until such demand is made by the Trustee, the Company may pay
the principal of and premium, if any, and interest, if any, on the Debentures
of such series to the Holders thereof, whether or not the Debentures of such
series are overdue.
If, after a Security Exchange with respect to the Debentures
of any series, an Event of Default with respect to Debentures of such series
occurs and is continuing, the Trustee may in its discretion proceed to protect
and enforce its rights and the rights of the Holders of Debentures of such
series by such appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
Section 504. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Company
(or any other obligor upon the Debentures), its property or its creditors
after a Security Exchange with respect to the Debentures of any series, the
Trustee shall be entitled and empowered, by intervention in such proceeding or
otherwise, to take any and all actions authorized under the Trust Indenture
Act in order to have claims of the Holders of Debentures of such series and the
Trustee allowed in any such proceeding. In particular, the Trustee shall be
authorized 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
of Debentures of such series to make such payments to the Trustee and, in the
event that the Trustee shall consent to the making of such payments directly
to the Holders of Debentures of such series, to pay to the Trustee any amount
due it for the reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel, and any other amounts due the Trustee
under Section 607 except such costs and expenses, as are a result of
negligence or bad faith on the part of the Trustee.
No provision of this Indenture shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Debentures or the rights of any Holder thereof or to authorize
the Trustee to vote in respect of the claim of any Holder in any such
proceeding; provided, however, that the Trustee may, after a Security Exchange
with respect to Debentures of any series on behalf of the Holders of
Debentures of such series, vote for the election of a trustee in bankruptcy or
similar official and be a member of a creditors' or other similar committee.
Section 505. Trustee May Enforce Claims Without Possession of
Debentures.
All rights of action and claims under this Indenture or the
Debentures may be prosecuted and enforced by the Trustee without the
possession of any of the Debentures or the production thereof in any proceeding
relating thereto, and any such proceeding instituted by the Trustee shall be
brought in its own name as trustee of an express trust, and any recovery of
judgment shall, after provision for the payment of the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel
except such costs and expenses, as are a result of negligence or bad faith on
the part of the Trustee, be for the ratable benefit of the Holders of the
Debentures in respect of which such judgment has been recovered.
Section 506. Application of Money Collected.
Subject to Article Fourteen, any money collected by the
Trustee pursuant to this Article shall be applied in the following order, at
the date or dates fixed by the Trustee and, in case of the distribution of
such money on account of principal or any premium or interest, upon
presentation of the Debentures and the notation thereon of the payment if only
partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 607;
SECOND: To the payment of the amounts then due and unpaid
for principal of and any premium and interest on the Debentures in
respect of which or for the benefit of which such money has been
collected, ratably, without preference or priority of any kind,
according to the amounts due and payable on such Debentures for
principal and any premium and interest, respectively; and
THIRD: To the payment of the remainder, if any, to the
Company or any other Person lawfully entitled thereto.
Section 507. Limitation on Suits.
Prior to a Security Exchange with respect to the Debentures
of any series, Capital shall, with respect to the Debentures of such series,
have the right to institute any proceeding, judicial or otherwise, with
respect to this Indenture, or for the appointment of a receiver or trustee,
or for any other remedy hereunder.
After a Security Exchange with respect to the Debentures of
any series, no Holder of any Debenture of that series shall have any right to
institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to the
Debentures of that series;
(2) the Holders of not less than 25% in principal amount of
the Outstanding Debentures of that series shall have made written
request to the Trustee to institute proceedings in respect of such
Event of Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
indemnity reasonably satisfactory in form and substance to the
Trustee against the costs, expenses and liabilities to be incurred
in compliance with such request;
(4) the Trustee for 60 days after its receipt of such
notice, request and offer of indemnity has failed to institute any
such proceeding; and
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders
of a majority in principal amount of the Outstanding Debentures of
that series;
it being understood and intended that no one or more of such Holders shall
have any right in any manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other of such Holders, or to obtain or to seek to obtain priority or
preference over any other of such Holders or to enforce any right under this
Indenture, except in the manner herein provided and for the equal and ratable
benefit of all of such Holders.
Section 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest.
Notwithstanding any other provision in this Indenture, the
Holder of any Debenture shall have the right, which is absolute and
unconditional, to receive payment of the principal of and any premium and
(subject to Section 307) any interest on such Debenture on the Stated Maturity
or Maturities expressed in such Debenture (or, in the case of redemption, on
the Redemption Date) and to institute suit for the enforcement of any such
payment and such rights shall not be impaired without the consent of such
Holder.
Section 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding
to enforce any right or remedy under this Indenture and such proceeding has
been discontinued or abandoned for any reason, or has been determined adversely
to the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders
shall be restored severally and respectively to their former positions
hereunder and thereafter all rights and remedies of the Trustee and the
Holders shall continue as though no such proceeding had been instituted.
Section 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Debentures in the last
paragraph of Section 306, no right or remedy herein conferred upon or reserved
to the Trustee or to the Holders is intended to be exclusive of any other
right or remedy, and every right and remedy shall, to the extent permitted by
law, be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
Section 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any
Debentures to exercise any right or remedy accruing upon any Event of Default
shall impair any such right or remedy or constitute a waiver of any such Event
of Default or an acquiescence therein. Subject to Section 507, every right
and remedy given by this Article or by law to the Trustee or to the Holders
may be exercised from time to time, and as often as may be deemed expedient,
by the Trustee or by the Holders, as the case may be.
Section 512. Control by Holders.
After a Security Exchange with respect to the Debentures of
any series, the Holders of a majority in principal amount of the Outstanding
Debentures of such series shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee, with respect to the
Debentures of such series, provided that
(1) such direction shall not be in conflict with any rule
of law or with this Indenture, and
(2) the Trustee may take any other action deemed proper by
the Trustee which is not inconsistent with such direction.
Upon receipt by the Trustee of any such direction with
respect to Debentures of any series, a record date shall be set for
determining the Holders of Outstanding Debentures of such series entitled to
join in such direction, which record date shall be the close of business on
the day the Trustee receives such direction. The Holders of Outstanding
Debentures of such series on such record date (or their duly appointed
agents), and only such Persons, shall be entitled to join in such direction,
whether or not such Holders remain Holders after such record date; provided
that, unless such direction shall have become effective by virtue of Holders
of at least a majority in principal amount of Outstanding Debentures of such
series on such record date (or their duly appointed agents) having joined
therein on or prior to the 90th day after such record date, such direction
shall automatically and without any action by any Person be cancelled and of
no further effect. Nothing in this paragraph shall prevent a Holder (or a
duly appointed agent thereof) from giving, before or after the expiration of
such 90-day period, a direction contrary to or different from, or, after the
expiration of such period, identical to, a direction that has been cancelled
pursuant to the proviso to the preceding sentence, in which event a new record
date in respect thereof shall be set pursuant to this paragraph.
Section 513. Waiver of Past Defaults.
Prior to a Security Exchange with respect to the Debentures
of any series, Capital may not waive any past default hereunder with respect
to such series and its consequences without the consent of the holders of not
less than a majority in stated liquidation preference of the Preferred
Securities of the related series; provided that Capital may not waive any
default (1) in the payment of the principal of or any premium or interest on
any Debenture or (2) in respect of a covenant or provision hereof which under
Article Nine cannot be modified without the consent of the Holder of each
Outstanding Debenture of such series affected without, in each case, the
consent of each holder of Preferred Securities of such series.
After a Security Exchange with respect to the Debentures of
any series, the Holders of not less than a majority in principal amount of the
Outstanding Debentures of such series may on behalf of the Holders of all the
Debentures of such series waive any past default hereunder with respect to
such series and its consequences, except a default
(1) in the payment of the principal of or any premium or
interest on any Debenture of such series, or
(2) in respect of a covenant or provision hereof which
under Article Nine cannot be modified or amended without the
consent of the Holder of each Outstanding Debenture of such series
affected.
Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
Section 514. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, a court may require any party litigant
in such suit to file an undertaking to pay the costs of such suit, and may
assess costs against any such party litigant, in the manner and to the extent
provided in the Trust Indenture Act; provided that neither this Section nor
the Trust Indenture Act shall be deemed to authorize any court to require such
an undertaking or to make such an assessment in any suit instituted by the
Company.
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as
provided by the Trust Indenture Act. Notwithstanding the foregoing, no
provision of this Indenture shall require the Trustee to expend or risk its
own funds or otherwise incur any financial liability in the performance of any
of its duties hereunder, or in the exercise of any of its rights or powers, if
it shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it. Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.
Section 602. Notice of Defaults.
If a default occurs hereunder with respect to Debentures of
any series, the Trustee shall give the Holders of Debentures of such series
notice of such default as and to the extent provided by the Trust Indenture
Act; provided, however, that in the case of any default of the character
specified in Section 501(3) with respect to Debentures of such series, no such
notice to Holders shall be given until at least 30 days after the occurrence
thereof. For the purpose of this Section, the term "default" means any event
which is, or after notice or lapse of time or both would become, an Event of
Default with respect to Debentures of such series.
Section 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(a) the Trustee may rely and shall be protected in acting
or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party
or parties;
(b) any request or direction of the Company mentioned
herein shall be sufficiently evidenced by a Company Request or
Company Order and any resolution of the Board of Directors may be
sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting any action
hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its
part, rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel and the written
advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in
reliance thereon;
(e) the Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the
request or direction of any of the Holders pursuant to this
Indenture, unless such Holders shall have offered to the Trustee
security or indemnity reasonably satisfactory in form and
substance to the Trustee against the costs, expenses and
liabilities which might be incurred by it in compliance with such
request or direction;
(f) prior to the occurrence of an Event of Default and
after the remedy or waiver of all Events of Default, the Trustee
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, debenture, note, other evidence of indebtedness or
other paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or
matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall upon
reasonable notice to the Company be entitled to examine the books,
records and premises of the Company, personally or by agent or
attorney at a time and place acceptable to the Company; and
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be
responsible for any misconduct or negligence on the part of any
agent or attorney appointed with due care by it hereunder.
Section 604. Not Responsible for Recitals or Issuance of Debentures.
The recitals contained herein and in the Debentures, except
the Trustee's certificates of authentication, shall be taken as the statements
of the Company, and the Trustee or any Authenticating Agent assumes no
responsibility for their correctness. The Trustee makes no representations as
to the validity or sufficiency of this Indenture or of the Debentures. The
Trustee or any Authenticating Agent shall not be accountable for the use or
application by the Company of Debentures or the proceeds thereof.
Section 605. May Hold Debentures.
The Trustee, any Authenticating Agent, any Paying Agent, any
Debenture Registrar or any other agent of the Company, in its individual or
any other capacity, may become the owner or pledgee of Debentures and, subject
to Sections 608 and 613, may otherwise deal with the Company with the same
rights it would have if it were not Trustee, Authenticating Agent, Paying
Agent, Debenture Registrar or such other agent.
Section 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed with the Company.
Section 607. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its written request for all reasonable
expenses, disbursements and advances incurred or made by the
Trustee in accordance with any provision of this Indenture
(including the reasonable compensation, and reasonable expenses
and disbursements of its agents and outside counsel), except any
such expense, disbursement or advance as may be attributable to
its negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without
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 reasonable costs and expenses of
defending itself against any claim or liability in connection with
the exercise or performance of any of its powers or duties
hereunder.
Section 608. Disqualification; Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest
within the meaning of the Trust Indenture Act, the Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided
by, and subject to the provisions of, the Trust Indenture Act and this
Indenture.
Section 609. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall
be a Person that is eligible pursuant to the Trust Indenture Act to act as
such and has a combined capital and surplus of at least $50,000,000 or is a
subsidiary of a corporation which shall be a Person that has a combined
capital and surplus of at least $50,000,000 and which unconditionally
guarantees the obligations of the Trustee hereunder. If such Person publishes
reports of condition at least annually, pursuant to law or to the requirements
of said supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such Person shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Trustee shall cease to be eligible
in accordance with the provisions of this Section, it shall resign immediately
in the manner and with the effect hereinafter specified in this Article.
Section 610. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 611.
(b) The Trustee may resign at any time with respect to the
Debentures of one or more series by giving written notice thereof to the
Company. If the instrument of acceptance by a successor Trustee required by
Section 611 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation, the resigning Trustee may petition
any court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Debentures of such series.
(c) The Trustee may be removed at any time with respect to
the Debentures of any series by Act of the Holders of a majority in principal
amount of the Outstanding Debentures of such series, delivered to the Trustee
and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 608 after
written request therefor by the Company or by any Holder who has
been a bona fide Holder of a Debenture for at least six months, or
(2) the Trustee shall cease to be eligible under Section
609 and shall fail to resign after written request therefor by the
Company or by any such Holder, or
(3) the Trustee shall become incapable of acting or shall
be adjudged a bankrupt or insolvent or a receiver of the Trustee
or of its property shall be appointed or any public officer shall
take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee with respect to all securities, or (ii) subject to Section 514, any
Holder who has been a bona fide Holder of a Debenture for at least six months
may, on behalf of itself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Debentures and the appointment of a successor Trustee or Trustees.
(e) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Trustee for
any cause, with respect to the Debentures of one or more series, the Company,
by a Board Resolution, shall promptly appoint a successor Trustee or Trustees
with respect to the Debentures of that or those series (it being understood
that any such successor Trustee may be appointed with respect to the
Debentures of one or more or all of such series and that at any time there
shall be only one Trustee with respect to the Debentures of any particular
series) and shall comply with the applicable requirements of Section 611. If,
within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee with respect to the Debentures
of any series shall be appointed by Act of the Holders of a majority in
principal amount of the Outstanding Debentures of such series delivered to the
Company and the retiring Trustee, the successor Trustee so appointed shall,
forthwith upon its acceptance of such appointment in accordance with the
applicable requirements of Section 611, become the successor Trustee with
respect to the Debentures of such series and to that extent supersede the
successor Trustee appointed by the Company. If no successor Trustee with
respect to the Debentures of any series shall have been so appointed by the
Company or the Holders and accepted appointment in the manner required by
Section 611, any Holder who has been a bona fide Holder of a Debenture of such
series for at least six months may, on behalf of itself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Debentures of such
series.
(f) The Company shall give notice of each resignation and
each removal of the Trustee with respect to the Debentures of any series and
each appointment of a successor Trustee with respect to the Debentures of any
series to all Holders of Debentures of such series in the manner provided in
Section 106. Each notice shall include the name of the successor Trustee with
respect to the Debentures of such series and the address of its Corporate
Trust Office.
Section 611. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor
Trustee with respect to all Debentures, every such successor Trustee so
appointed shall execute, acknowledge and deliver to the Company and to the
retiring Trustee an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Trustee shall become effective and such
successor Trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the retiring Trustee;
but, on the request of the Company or the successor Trustee, such retiring
Trustee shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor Trustee all the rights, powers and trusts of the
retiring Trustee and shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder.
(b) In case of the appointment hereunder of a successor
Trustee with respect to the Debentures of one or more (but not all) series,
the Company, the retiring Trustee and each successor Trustee with respect to
the Debentures of such series shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall accept such
appointment and which (1) shall contain such provisions as shall be necessary
or desirable to transfer the rights, powers, trust and duties of the retiring
Trustee with respect to the Debentures of that or those series to which the
appointment of such successor Trustee relates, (2) if the retiring Trustee is
not retiring with respect to all Debentures, shall contain such provisions as
shall be deemed necessary or desirable to confirm that all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Debentures of
that or those series as to which the retiring Trustee is not retiring shall
continue to be vested in the retiring Trustee, and (3) shall add to or change
any of the provisions of this Indenture as shall be necessary to provide for
or facilitate the administration of the trusts hereunder by more than one
Trustee, it being understood that nothing herein or in such supplemental
indenture shall constitute such Trustee co-trustees of the same trust and that
each such Trustee shall be trustee of a trust or trusts hereunder separate and
apart from any trust or trusts hereunder administered by any other such
Trustee; and upon the execution and delivery of such supplemental indenture
the resignation or removal of the retiring Trustee shall become effective to
the extent provided therein and each such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee with respect to the
Debentures of that or those series to which the appointment of such successor
Trustee relates; but, on request of the Company or any successor Trustee, such
retiring Trustee shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder with
respect to the Debentures of that or those series to which the appointment of
such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Company
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Trustee all such rights, powers and trusts
referred to in paragraphs (a) and (b) of this Section, as the case may be.
(d) No successor shall accept its appointment unless at the
time of such acceptance such successor Trustee shall be qualified and eligible
under this Article.
Section 612. Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all the corporate
trust business of the Trustee, shall be the successor of the Trustee
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. In case any Debentures
shall have been authenticated, but not delivered, by the Trustee then in
office, any successor by merger, conversion or consolidation to such
authenticating Trustee may adopt such authentication and deliver the
Debentures so authenticated with the same effect as if such successor Trustee
had itself authenticated such Debentures.
Section 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the
Company (or any other obligor upon the Debentures), the Trustee shall be
subject to the provisions of the Trust Indenture Act regarding the collection
of claims against the Company (or any such other obligor).
Section 614. Appointment of Authenticating Agent.
The Trustee may with the consent of the Company appoint an
Authenticating Agent or Agents with respect to one or more series of
Debentures which shall be authorized to act on behalf of the Trustee to
authenticate Debentures of such series issued upon original issue and upon
exchange, registration of transfer or partial redemption thereof or pursuant
to Section 306, and Debentures so authenticated shall be entitled to the
benefits of this Indenture and shall be valid and obligatory for all purposes
as if authenticated by the Trustee hereunder. Wherever reference is made in
this Indenture to the authentication and delivery of Debentures by the Trustee
or the Trustee's certificate of authentication, such reference shall be deemed
to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized
and doing business under the laws of the United States of America, any State
thereof or the District of Columbia, authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of not less than
$50,000,000 and subject to supervision or examination by Federal or State
authority. If such Authenticating Agent publishes reports of condition at
least annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section, the combined
capital and surplus of such Authenticating Agent shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent shall cease to
be eligible in accordance with the provisions of this Section, such
Authenticating Agent shall resign immediately in the manner and with the
effect specified in this Section.
Any corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section, without the execution or filing of any
paper or any further act on the part of the Trustee or the Authenticating
Agent.
An Authenticating Agent may resign at any time by giving
written notice thereof to the Trustee and to the Company. The Trustee or the
Company may at any time terminate the agency of an Authenticating Agent by
giving written notice thereof to such Authenticating Agent and to the Company
or the Trustee, as the case may be. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice
of such appointment by first-class mail, postage prepaid, to all Holders of
Debentures of the series with respect to which such Authenticating Agent will
serve, as their names and addresses appear in the Debenture Register. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent from
time to time reasonable compensation for its services under this Section, and
the Trustee shall be entitled to be reimbursed for such payments, subject to
the provisions of Section 607.
If an appointment with respect to one or more series is made
pursuant to this Section, the Debentures of such series may have endorsed
thereon, in addition to the Trustee's certificate of authentication, an
alternative certificate of authentication in the following form:
This is one of the Debentures of the series designated
therein referred to in the within-mentioned Indenture.
........................,
As Trustee
By......................,
As Authenticating Agent
By......................,
Authorized Officer
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and
Addresses of Holders.
After a Security Exchange with respect to Debentures of any
series, the Company will furnish or cause to be furnished to the Trustee
(a) semi-annually, not later than 10 days after each
Regular Record Date in each year, a list for such series of
Debentures, in such form as the Trustee may reasonably require, of
the names and addresses of the Holders of Debentures of such
series as of the preceding Regular Record Date, and
(b) at such other times as the Trustee may request in
writing, within 30 days after the receipt by the Company of any
such request, a list of similar form and content as of a date not
more than 15 days prior to the time such list is furnished;
excluding from any such list names and addresses received by the Trustee in
its capacity as Debenture Registrar.
Section 702. Preservation of Information; Communications to Holders.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained in the
most recent list furnished to the Trustee as provided in Section 701 and the
names and addresses of Holders received by the Trustee in its capacity as
Debenture Registrar. The Trustee may destroy any list furnished to it as
provided in Section 701 upon receipt of a new list so furnished.
(b) The rights of the Holders to communicate with other
Holders with respect to their rights under this Indenture or under the
Debentures, and the corresponding rights and privileges of the Trustee, shall
be as provided by the Trust Indenture Act.
(c) Every Holder of Debentures, by receiving and holding
the same, agrees with the Company and the Trustee that neither the Company nor
the Trustee nor any agent of either of them shall be held accountable by
reason of any disclosure of information as to names and addresses of Holders
made pursuant to the Trust Indenture Act.
Section 703. Reports by Trustee.
(a) The Trustee shall transmit to Holders such reports
concerning the Trustee and its actions under this Indenture as may be required
pursuant to the Trust Indenture Act at the times and in the manner provided
pursuant thereto. To the extent that any such report is required by the Trust
Indenture Act with respect to any 12 month period, such report shall cover the
12 month period ending July 15 and shall be transmitted by the next succeeding
September 15.
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which any Debentures are listed, with the Commission and with the Company. The
Company will notify the Trustee when any Debentures are listed on any stock
exchange.
Section 704. Reports by Company.
The Company shall file with the Trustee and the Commission,
and transmit to Holders, such information, documents and other reports, and
such summaries thereof, as may be required pursuant to the Trust Indenture Act
at the times and in the manner provided pursuant to such Act; provided that
any such information, documents or reports required to be filed with the
Commission pursuant to Section 13 or 15(d) of the Exchange Act shall be filed
with the Trustee within 15 days after the same is so required to be filed with
the Commission.
ARTICLE EIGHT
Consolidation, Merger, or Sale of Assets
Section 801. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any
other Person or sell its properties and assets as, or substantially as, an
entirety to any Person, and the Company shall not permit any Person to
consolidate with or merge into the Company, unless:
(1) in case the Company shall consolidate with or merge
into another Person or sell its properties and assets as, or
substantially as, an entirety to any Person, the Person formed by
such consolidation or into which the Company is merged or the
Person which purchases the properties and assets of the Company
as, or substantially, as an entirety shall be a corporation,
partnership or trust, shall be organized and validly existing
under the laws of the United States of America, any State thereof
or the District of Columbia and shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the
Trustee, in form satisfactory to the Trustee, the due and punctual
payment of the principal of and any premium and interest on all
the Debentures and the performance or observance of every covenant
of this Indenture on the part of the Company to be performed or
observed, by supplemental indenture satisfactory in form to the
Trustee, executed and delivered to the Trustee, by the Person (if
other than the Company) formed by such consolidation or into which
the Company shall have been merged or by the corporation which
shall have acquired the Company's assets;
(2) immediately after giving effect to such transaction, no
Event of Default shall have happened and be continuing; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, or sale and, if a supplemental indenture is
required in connection with such transaction, such supplemental
indenture comply with this Article and that all conditions
precedent herein provided for relating to such transaction have
been complied with.
Section 802. Successor Substituted.
Upon any consolidation of the Company with, or merger of the
Company into, any other Person or any sale of the properties and assets of the
Company as, or substantially as, an entirety in accordance with Section 801,
the successor Person formed by such consolidation or into which the Company is
merged or to which such sale is made shall succeed to, and be substituted for,
and may exercise every right and power of, the Company under this Indenture
with the same effect as if such successor Person had been named as the Company
herein, and thereafter, the predecessor Person shall be relieved of all
obligations and covenants under this Indenture and the Debentures.
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when
authorized by a Board Resolution, and the Trustee, at any time and from time
to time, may enter into one or more indentures supplemental hereto, in form
satisfactory to the Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the
Company and the assumption by any such successor of the covenants
of the Company herein and in the Debentures; or
(2) to add to the covenants of the Company for the benefit
of the Holders of all or any series of Debentures (and if such
covenants are to be for the benefit of less than all series of
Debentures, stating that such covenants are expressly being
included solely for the benefit of such series) or to surrender
any right or power herein conferred upon the Company; or
(3) to add any additional Events of Default; or
(4) to add to or change any of the provisions of this
Indenture to such extent as shall be necessary to permit or
facilitate the issuance of Debentures in bearer form, registrable
or not registrable as to principal, and with or without interest
coupons, or to permit or facilitate the issuance of Debentures in
uncertificated form; or
(5) to add to, change or eliminate any of the provisions of
this Indenture in respect of one or more series of Debentures,
including, without limitation, with respect to any of the
provisions set forth in Article Fourteen, provided that any such
addition, change or elimination (i) shall neither (A) apply to any
Debenture of any series created prior to the execution of such
supplemental indenture and entitled to the benefit of such
provision nor (B) modify the rights of the Holder of any such
Debenture with respect to such provision or (ii) shall become
effective only when there is no such Debenture Outstanding; or
(6) to secure the Debentures of any series; or
(7) to establish the form or terms of Debentures of any
series as permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of
appointment hereunder by a successor Trustee with respect to the
Debentures of one or more series and to add to or change any of
the provisions of this Indenture as shall be necessary to provide
for or facilitate the administration of the trusts hereunder by
more than one Trustee, pursuant to the requirements of Section
611(b); or
(9) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture, provided that such action
pursuant to this clause (9) shall not adversely affect the
interests of the Holders of Debentures of any series in any
material respect; or
(10) to conform to any mandatory provisions of law.
Section 902. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than a majority
of principal amount of the Outstanding Debentures of each series affected by
such supplemental indenture (and, prior to a Security Exchange with respect to
the Debentures of such series, the consent of the holders of not less than a
majority in stated liquidation preference of the Preferred Securities of the
related series), by Act of said Holders (and, prior to such a Security
Exchange, by a written action of the holders of such Preferred Securities)
delivered to the Company and the Trustee, the Company, when authorized by a
Board Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders of Debentures of such series
under this Indenture; provided, however, that no such supplemental indenture
shall, without the consent of the Holder of each Outstanding Debenture
affected thereby (and, prior to a Security Exchange with respect to the
Debentures of any series affected thereby, the consent of the holders of each
Preferred Security of the related series),
(1) change the Stated Maturity of the principal of, or any
instalment of principal of or interest on, any Debenture, or reduce
the principal amount thereof or the rate of interest thereon
(including any change in the Floating or Adjustable Rate Provision
pursuant to which such rate is determined that would reduce such
rate for any period) or any premium payable upon the redemption
thereof, or change any Place of Payment where, or the coin or
currency in which, any Debenture or any premium or interest thereon
is payable, or impair the right to institute suit for the
enforcement of any such payment on or after the Stated Maturity
thereof (or, in the case of redemption, on or after the Redemption
Date), or modify the provisions of this Indenture with respect to
the subordination of the Debentures of any series in a manner
adverse to the Holders, or
(2) reduce the percentage in principal amount of the
Outstanding Debentures of any series, the consent of whose Holders
is required for any such supplemental indenture, or the consent of
whose Holders is required for any waiver (of compliance with
certain provisions of this Indenture or certain defaults hereunder
and their consequences) provided for in this Indenture, or
(3) modify any of the provisions of this Section, Section
513 or Section 907, except to increase any such percentage or to
provide that certain other provisions of this Indenture cannot be
modified or waived without the consent of the Holder of each
Outstanding Debenture affected thereby, provided, however, that
this clause shall not be deemed to require the consent of any
Holder with respect to changes in the references to "the Trustee"
and concomitant changes in this Section and Section 907, or the
deletion of this proviso, in accordance with the requirements of
Sections 611(b) and 901(8).
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Debentures, or which modifies the
rights of the Holders of Debentures of such series with respect to such
covenant or other provision, shall be deemed not to affect the rights under
this Indenture of the Holders of Debentures of any other series.
It shall not be necessary for any Act of Holders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.
Section 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by,
any supplemental indenture permitted by this Article or the modifications
thereby of the trusts created by this Indenture, the Trustee shall be entitled
to receive, and (subject to Section 601) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture. The Trustee may, but
shall not be obligated to, enter into any such supplemental indenture which
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise.
Section 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this
Article, this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Indenture for all purposes;
and every Holder of Debentures theretofore or thereafter authenticated and
delivered hereunder shall be bound thereby.
Section 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this
Article shall conform to the requirements of the Trust Indenture Act.
Section 906. Reference in Debentures to Supplemental Indentures.
Debentures of any series authenticated and delivered after
the execution of any supplemental indenture pursuant to this Article may, and
shall if required by the Trustee, bear a notation in form approved by the
Trustee as to any matter provided for in such supplemental indenture. If the
Company shall so determine, new Debentures of any series so modified as to
conform, in the opinion of the Trustee and the Company, to any such
supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Outstanding
Debentures of such series.
Section 907. Waiver of Compliance by Holders.
Anything in this Indenture to the contrary notwithstanding,
any of the acts which the Company is required to do, or is prohibited from
doing, by any of the provisions of this Indenture may, to the extent that such
provisions might be changed or eliminated by a supplemental indenture pursuant
to Section 902 upon consent of Holders of not less than a majority in
aggregate principal amount of the then Outstanding Debentures of the series
affected (and, prior to a Security Exchange with respect to the Debentures of
such series, holders of at least a majority in stated liquidation preference
of the Preferred Securities of the related series), be omitted or done by the
Company, if there is obtained the prior consent or waiver of the Holders of at
least a majority in aggregate principal amount of the then Outstanding
Debentures of such series (and, prior to a Security Exchange with respect to
the Debentures of such series, holders of at least a majority in stated
liquidation preference of the Preferred Securities of the related series).
Section 908. Subordination Unimpaired.
No provision in any supplemental indenture that affects the
superior position of the holders of Senior Debt shall be effective against
holders of Senior Debt without the consent of any such affected holder.
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each
series of Debentures that it will duly and punctually pay or cause to be paid
the principal of and any premium and interest (including any Additional
Interest) on the Debentures of that series in accordance with the terms of the
Debentures and this Indenture.
Section 1002. Maintenance of Office or Agency.
After a Security Exchange with respect to the Debentures of
any series, so long as any Debentures are Outstanding, the Company will
maintain in each Place of Payment for the Debentures of that series an office
or agency where Debentures of that series may be presented or surrendered for
payment, where Debentures of that series may be surrendered for registration
of transfer or exchange, and where notices and demands to or upon the Company
in respect of the Debentures of that series and this Indenture may be served.
The Company will give prompt written notice to the Trustee of the location,
and any change in the location, of such office or agency. If at any time the
Company shall fail to maintain any such required office or agency or shall
fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee, and the Company hereby appoints the Trustee as its
agent to receive all such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more
other offices or agencies where the Debentures of one or more series may be
presented or surrendered for any or all such purposes and may from time to
time rescind such designations; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligation to
maintain an office or agency in each Place of Payment for Debentures of any
series for such purposes. The Company will give prompt written notice to the
Trustee of any such designation or rescission and of any change in the
location of any such other office or agency.
Section 1003. Money for Debentures Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent
with respect to any series of Debentures, it will, on or before each due date
of the principal of or any premium or interest on any of the Debentures of
that series, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal and any premium and
interest so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and, after a Security Exchange with
respect to the Debentures of that series, will promptly notify the Trustee of
its action or failure so to act.
Whenever the Company shall have one or more Paying Agents
for any series of Debentures, it will, prior to each due date of the principal
of or any premium or interest on any Debentures of that series, deposit with a
Paying Agent a sum sufficient to pay such amount, such sum to be held as
provided by the Trust Indenture Act, and (unless such Paying Agent is the
Trustee) after a Security Exchange with respect to the Debentures of that
series, the Company will promptly notify the Trustee of its action or failure
so to act.
The Company will cause each Paying Agent for any series of
Debentures other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will (i) comply with
the provisions of the Trust Indenture Act applicable to it as a Paying Agent
and (ii) during the continuance of any default by the Company (or any other
obligor upon the Debentures of that series) in the making of any payment in
respect of the Debentures of that series, and upon the written request of the
Trustee, forthwith pay to the Trustee all sums held in trust by such Paying
Agent for payment in respect of the Debentures of that series.
The Company may at any time, for the purpose of obtaining
the satisfaction and discharge of this Indenture or for any other purpose,
pay, or by Company Order direct any Paying Agent to pay, to the Trustee all
sums held in trust by the Company or such Paying Agent, such sums to be held
by the Trustee upon the same trusts as those upon which such sums were held by
the Company or such Paying Agent; and, upon such payment by any Paying Agent
to the Trustee, such Paying Agent shall be released from all further liability
with respect to such money.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of or any
premium or interest on any Debenture of any series and remaining unclaimed for
two years after such principal, premium or interest has become due and payable
shall be paid to the Company on Company Request, or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Debenture
shall thereafter, as an unsecured general creditor, look only to the Company
for payment thereof, and all liability of the Trustee or such Paying Agent
with respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in a newspaper published in
the English language, customarily published on each Business Day and of
general circulation in the Borough of Manhattan, the City of New York, notice
that such money remains unclaimed and that, after a date specified therein,
which shall not be less than 30 days from the date of such publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
Section 1004. Statement by Officers as to Default.
The Company will deliver to the Trustee within 120 days
after the end of each fiscal year of the Company ending after the date hereof,
a certificate signed by the Company's principal executive officer, principal
financial officer or principal accounting officer stating whether or not to the
best knowledge of the signer thereof the Company is in compliance with all
terms, conditions and covenants of this Indenture (without regard to any
period of grace or requirement of notice provided hereunder) and if the signer
has obtained knowledge of any continuing default by the Company in the
performance, observation or fulfillment of any such term, condition or
covenant, specifying each such default and the nature thereof.
Section 1005. Limitations on Dividends and Other Payments on Capital
Stock.
Prior to a Security Exchange with respect to Debentures of
any series, the Company agrees for the benefit of the Holders of Debentures of
such series that it shall not declare or pay any dividend on, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of the
Company's capital stock or make any guarantee payments with respect to the
foregoing (other than (i) payments under the Guarantee, (ii) acquisitions of
shares of Common Stock in connection with the satisfaction by the Company of
its obligations under any employee benefit plans and (iii) redemptions of any
share purchase rights issued by the Company pursuant to the Company's Share
Purchase Rights Plan adopted on October 27, 1989, as amended from time to
time, or the declaration of a dividend of similar share purchase rights in the
future), if at such time the Company is in default with respect to its payment
obligations under the Guarantee or there shall have occurred an Event of
Default with respect to the Debentures of such series.
Section 1006. Limitations on Conduct of Capital and Other
Limitations.
Prior to a Security Exchange with respect to Debentures of
any series, the Company agrees for the benefit of the Holders of Debentures of
such series that it shall (i) not cause or permit any Common Securities of
Capital to be transferred, (ii) maintain direct or indirect ownership of all
outstanding securities of Capital other than (x) the Preferred Securities of
any series and (y) any other securities issued by Capital (other than the
Common Securities) so long as the issuance thereof to Persons other than the
Company or any of its Subsidiaries would not cause Capital to become an
"investment company" required to be registered under the Investment Company
Act of 1940, as amended, (iii) cause at least 21% of the total value of
Capital and at least 21% of all interests in the capital, income, gain, loss,
deduction and credit of Capital to be represented by Common Securities, (iv)
not voluntarily dissolve, wind up or liquidate Capital (other than in
connection with the exchange of all series of Preferred Securities outstanding
for the related series of Debentures) or either of the Managing Members, (v)
cause the Company and Aetna Capital Holdings, Inc. to remain the Managing
Members of Capital and timely perform all of their respective duties as
Managing Members of Capital (including the duty to declare and pay dividends
on the Preferred Securities), and (vi) use reasonable efforts to cause Capital
to remain a limited liability company and otherwise continue to be treated as
a partnership for U.S. federal income tax purposes; provided that,
notwithstanding the foregoing, the Company may permit Capital to consolidate
or merge with or into or convey, transfer or lease its properties and assets
substantially as an entirety to another Person upon the terms and subject to
the conditions set forth in the L.L.C. Agreement.
Section 1007. Stock Exchange Listing.
In the event of a Security Exchange with respect to
Debentures of any series, the Company will use its best efforts to have the
Debentures of such series listed on the same exchange as that on which the
Preferred Securities of the related series were listed immediately prior to
such Security Exchange.
ARTICLE ELEVEN
Redemption of Debentures
Section 1101. Applicability of Article.
Debentures of any series which are redeemable before their
Stated Maturity shall be redeemable in accordance with their terms and (except
as otherwise specified as contemplated by Section 301 for Debentures of any
series) in accordance with this Article.
Section 1102. Election to Redeem; Notice to Trustee.
At any time after a Security Exchange with respect to
Debentures of any series, in case of any redemption at the election of the
Company of less than all the Debentures of such series, the Company shall, at
least 60 days prior to the Redemption Date fixed by the Company (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of
such Redemption Date, of the principal amount of Debentures of such series to
be redeemed and, if applicable, of the tenor of the Debentures to be redeemed.
In the case of any redemption of Debentures prior to the expiration of any
restriction on such redemption provided in the terms of such Debentures or
elsewhere in this Indenture, the Company shall furnish the Trustee with an
Officers' Certificate evidencing compliance with such restriction.
Section 1103. Selection by Trustee of Debentures to Be Redeemed.
At any time after a Security Exchange with respect to
Debentures of any series, if less than all the Debentures of such series are
to be redeemed (unless all of the Debentures of such series and of a specified
tenor are to be redeemed), the particular Debentures to be redeemed shall be
selected not more than 45 days prior to the Redemption Date by the Trustee,
from the Outstanding Debentures of such series not previously called for
redemption, by such method as the Trustee shall deem fair and appropriate and
which may provide for the selection for redemption of portions (equal to the
minimum authorized denomination for Debentures of that series or any integral
multiple thereof) of the principal amount of Debentures of such series of a
denomination larger than the minimum authorized denomination for Debentures of
that series. If less than all of the Debentures of such series and of a
specified tenor are to be redeemed, the particular Debentures to be redeemed
shall be selected not more than 45 days prior to the Redemption Date by the
Trustee, from the Outstanding Debentures of such series and specified tenor
not previously called for redemption in accordance with the preceding sentence.
The Trustee shall promptly notify the Company in writing of
the Debentures selected for redemption and, in the case of any Debentures
selected for partial redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Debentures
shall relate, in the case of any Debentures redeemed or to be redeemed only in
part, to the portion of the principal amount of such Debentures which has been
or is to be redeemed.
Section 1104. Notice of Redemption.
Notice of redemption shall be given by first-class mail,
postage prepaid, mailed not less than 30 nor more than 60 days prior to the
Redemption Date, to each Holder of Debentures to be redeemed, at its address
appearing in the Debenture Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Debentures of any
series are to be redeemed, the identification (and, in the case of
partial redemption of any Debentures, the principal amounts) of
the particular Debentures to be redeemed,
(4) that on the Redemption Date the Redemption Price will
become due and payable upon each such Debenture to be redeemed and,
if applicable, that interest thereon will cease to accrue on and
after said date,
(5) the place or places where such Debentures are to be
surrendered for payment of the Redemption Price, and
(6) that the redemption is for a sinking fund, if such is
the case.
Notice of redemption of Debentures to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company.
Section 1105. Deposit of Redemption Price.
By 12:00 noon (New York time) on any Redemption Date, the
Company shall deposit with the Trustee or with a Paying Agent (or, if the
Company is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 1003) an amount of money sufficient to pay the Redemption
Price of, and (except if the Redemption Date shall be an Interest Payment
Date) accrued interest on, all the Debentures which are to be redeemed on that
date.
Section 1106. Debentures Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the
Debentures so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified, and from and after such date
(unless the Company shall default in the payment of the Redemption Price and
accrued interest) such Debentures shall cease to bear interest. Upon
surrender of any such Debenture for redemption in accordance with said notice,
such Debenture shall be paid by the Company at the Redemption Price, together
with accrued interest to the Redemption Date; provided, however, that, unless
otherwise specified as contemplated by Section 301, installments of interest
whose Stated Maturity is on or prior to the Redemption Date shall be payable
to the Holders of such Debentures, or one or more Predecessor Debentures,
registered as such at the close of business on the relevant Record Dates
according to their terms and the provisions of Section 307.
If any Debenture called for redemption shall not be so paid
upon surrender thereof for redemption, the principal and any premium shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Debenture.
Section 1107. Debentures Redeemed in Part.
Prior to a Security Exchange with respect to the Debentures
of any series, any Debenture of such series which is to be redeemed only in
part shall be surrendered at the place designated by the Company for such
purpose, and the Company shall execute, and the Trustee shall authenticate and
deliver to the Holder of such Debenture without service charge, a new
Debenture or Debentures of the same series and of like tenor, of any
authorized denomination as requested by such Holder, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Debenture so surrendered.
After a Security Exchange with respect to the Debentures of
any series, any Debenture of such series which is to be redeemed only in part
shall be surrendered at a Place of Payment therefor (with, if the Company or
the Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company and the Trustee duly executed by,
the Holder thereof or his attorney duly authorized in writing), and the
Company shall execute, and the Trustee shall authenticate and deliver to the
Holder of such Debenture without service charge, a new Debenture or Debentures
of the same series and of like tenor, of any authorized denomination as
requested by such Holder, in aggregate principal amount equal to and in
exchange for the unredeemed portion of the principal of the Debenture so
surrendered.
ARTICLE TWELVE
Defeasance and Covenant Defeasance
Section 1201. Company's Option to Effect Defeasance or
Covenant Defeasance.
The Company may elect, at any time, to have either Section
1202 or Section 1203 applied to the Outstanding Debentures of any series, upon
compliance with the conditions set forth below in this Article Twelve.
Section 1202. Defeasance and Discharge.
Upon the Company's exercise of the option provided in
Section 1201 to have this Section 1202 applied to the Outstanding Debentures
of any series, the Company shall be deemed to have been discharged from its
obligations, and the provisions of Article Fourteen shall cease to be
effective, with respect to the Outstanding Debentures of such series as
provided in this Section on and after the date the conditions set forth in
Section 1204 are satisfied (hereinafter called "Defeasance"). For this
purpose, such Defeasance means that the Company shall be deemed to have paid
and discharged the entire indebtedness represented by the Outstanding
Debentures of such series and to have satisfied all its other obligations
under the Debentures of such series and this Indenture insofar as the
Debentures of such series are concerned (and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging the same), subject
to the following which shall survive until otherwise terminated or discharged
hereunder: (1) the rights of Holders of Debentures of such series to receive,
solely from the trust fund described in Section 1204 and as more fully set
forth in such Section, payments in respect of the principal of and any premium
and interest on such Debentures of such series when payments are due, (2) the
Company's obligations with respect to the Debentures of such series under
Sections 304, 305, 306, 1002 and 1003, (3) the rights, powers, trusts, duties
and immunities of the Trustee hereunder, including, without limitation, its
rights under Section 607 and (4) this Article Twelve. Subject to compliance
with this Article Twelve, the Company may exercise its option provided in
Section 1201 to have this Section 1202 applied to the Outstanding Debentures
of any series notwithstanding the prior exercise of its option provided in
Section 1201 to have Section 1203 applied to the Outstanding Debentures of
such series.
Section 1203. Covenant Defeasance.
Upon the Company's exercise of the option provided in
Section 1201 to have this Section 1203 applied to the outstanding Debentures
of any series, (1) the Company shall be released from its obligations under
Section 1005 and Section 801 and (2) the occurrence of any event specified in
Section 501(3) (with respect to Section 801 and Section 1005) shall be deemed
not to be or result in an Event of Default, and (3) the provisions of Article
Fourteen shall cease to be effective, in each case with respect to the
Outstanding Debentures of such series as provided in this Section on and after
the date the conditions set forth in Section 1204 are satisfied (hereinafter
called "Covenant Defeasance"). For this purpose, such Covenant Defeasance
means that the Company may omit to comply with and shall have no liability in
respect of any term, condition or limitation set forth in any such specified
Section (to the extent so specified in the case of Section 501(3)), whether
directly or indirectly by reason of any reference elsewhere herein to any such
Section or by reason of any reference in any such Section to any other
provision herein or in any other document, but the remainder of this Indenture
and the Debentures of such series shall be unaffected thereby.
Section 1204. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of
either Section 1202 or Section 1203 to the Outstanding Debentures of any
series:
(1) The Company shall irrevocably have deposited or caused
to be deposited with the Trustee (or another trustee that
satisfies the requirements contemplated by Section 609 and agrees
to comply with the provisions of this Article Twelve applicable to
it) as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of Outstanding
Debentures of such series, (i) money in an amount, or (ii) U.S.
Government Obligations that through the scheduled payment of
principal and interest 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 thereof,
in each case sufficient, in the opinion of a nationally recognized
firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and
discharge, and which shall be applied by the Trustee (or any such
other qualifying trustee) to pay and discharge, the principal of
and any premium and interest on the Debentures of such series on
the respective Stated Maturities, in accordance with the terms of
this Indenture and the Debentures of such series. As used herein,
"U.S. Government Obligation" means (x) any security that is (i) a
direct obligation of the United States of America for the payment
of which full faith and credit of the United States of America is
pledged or (ii) an obligation of a Person controlled or supervised
by and acting as an agency or instrumentality for the United
States of America the timely payment of which is unconditionally
guaranteed as a full faith and credit obligation by the United
States of America, which, in either case (i) or (ii), is not
callable or redeemable at the option of the issuer thereof, and
(y) any depositary receipt issued by a bank (as defined in Section
3(a)(2) of the Securities Act of 1933, as amended) as custodian
with respect to any specific payment of principal of or interest
on any such U.S. Government Obligation specified in Clause (x) and
held by such custodian for the account of the holder of such
depositary receipt, or with respect to any specific payment of
principal of or interest on any such U.S. Government Obligation,
provided that (except as required by law) such custodian is not
authorized to make any deduction from the amount payable to the
Holder of such depositary receipt from any amount received by the
custodian in respect of the U.S. Government Obligation or the
specific payment of principal or interest evidenced by such
depositary receipt.
(2) In the case of an election under Section 1202, the
Company shall have delivered to the Trustee an Opinion of Counsel
stating that the Holders of the Outstanding Debentures of such
series will not recognize gain or loss for Federal income tax
purposes as a result of the deposit, Defeasance and discharge to
be effective with respect to the Debentures of such series and
will be subject to Federal income tax on the same amount, in the
same manner and at the same times as would be the case if such
deposit, Defeasance and discharge were not to occur.
(3) In the case of an election under Section 1203, the
Company shall have delivered to the Trustee an Opinion of Counsel
to the effect that the Holder of the Outstanding Debentures of
such series will not recognize gain or loss for Federal income tax
purposes as result of the deposit and Covenant Defeasance to be
effected with respect to the Debentures of such series and will be
subject to Federal income tax on the same amount, in the same
manner and at the same times as would be the case if such deposit
and Covenant Defeasance were not to occur.
(4) The Company shall have delivered to the Trustee an
Officers' Certificate to the effect that the Debentures of such
series, if then listed on any securities exchange, will not be
delisted as a result of such deposit.
(5) No Event of Default or event that (after notice or
lapse of time or both) would become an Event of Default shall have
occurred and be continuing at the time of such deposit or, with
regard to any event specified in Sections 501(4) and 501(5), at
any time on or prior to the 90th day after the date of such deposit
(it being understood that this condition shall not be deemed
satisfied until after such 90th day).
(6) The Company shall have delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel, each stating that
all conditions precedent with respect to such Defeasance or
Covenant Defeasance have been complied with.
(7) Such Defeasance or Covenant Defeasance shall not
result in the trust arising from such deposit constituting an
investment company within the meaning of the Investment Company
Act of 1940, as amended, unless such trust shall be qualified
under such Act or exempt from regulation thereunder.
(8) At the time of such deposit: (A) no default in the
payment of principal of (or premium, if any) or interest on any
Senior Debt shall have occurred and be continuing or (B) no other
event of default with respect to any Senior Debt shall have
occurred and be continuing and shall have resulted in such Senior
Debt becoming or being declared due and payable prior to the date
on which it would otherwise have become due and payable, or, in
the case of either Clause (A) or Clause (B) above, each such
default or event of default shall have been cured or waived or
shall have ceased to exist.
Section 1205. Deposited Money and U.S. Government Obligations to be
Held In Trust; Other Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section
1003, all money and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee or other qualifying trustee (solely for
purposes of this Section and Section 1206, the Trustee and any such other
trustee are referred to collectively as the "Trustee") pursuant to Section
1204 in respect of the Debentures of any series shall be held in trust and
applied by the Trustee, in accordance with the provisions of the Debentures of
such series and this Indenture, to the payment, either directly or through any
such Paying Agent (including the Company acting as its own Paying Agent) as
the Trustee may determine, to the Holders of Debentures of such series, of all
sums due and to become due thereon in respect of principal and any premium and
interest, but money so held in trust need not be segregated from other funds
except to the extent required by law. Money so held in trust shall not be
subject to the provisions of Article Fourteen.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 1204 or the principal and interest
receive in respect thereof other than any such tax, fee or other charge that
by law is for the account of the Holders of Outstanding Debentures.
Anything in this Article Twelve to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company from time to
time upon Company Request any money or U.S. Government Obligations held by it
as provided in Section 1204 with respect to Debentures of any series that, in
the opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, are in
excess of the amount thereof that would then be required to be deposited to
effect an equivalent Defeasance or Covenant Defeasance with respect to the
Debentures of such series.
Section 1206. Reinstatement.
If the Trustee or the Paying Agent is unable to apply any
money in accordance with this Article Twelve with respect to the Debentures of
any series by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application,
then the Company's obligations under this Indenture and the Debentures of such
series shall be revived and reinstated as though no deposit had occurred
pursuant to this Article Twelve with respect to Debentures of such series
until such time as the Trustee or Paying Agent is permitted to apply all money
held in trust pursuant to Section 1205 with respect to Debentures of such
series in accordance with this Article Twelve; provided, however, that if the
Company makes any payment of principal of or any premium or interest on any
Debenture of such series following the reinstatement of its obligations, the
Company shall be subrogated to the rights of the Holders of Debentures of such
series to receive such payment from the money so held in trust.
ARTICLE THIRTEEN
Sinking Funds
Section 1301. Applicability of Article.
The provisions of this Article shall be applicable to any
sinking fund for the retirement of Debentures of a series except as otherwise
specified as contemplated by Section 301 for Debentures of such series.
The minimum amount of any sinking fund payment provided for
by the terms of Debentures of any series is herein referred to as a "mandatory
sinking fund payment", and any payment in excess of such minimum amount
provided for by the terms of Debentures of any series is herein referred to as
an "optional sinking fund payment". If provided for by the terms of
Debentures of any series, the cash amount of any sinking fund payment may be
subject to reduction as provided in Section 1302. Each sinking fund payment
shall be applied to the redemption of Debentures of any series as provided for
by the terms of Debentures of such series.
Section 1302. Satisfaction of Sinking Fund Payments
with Debentures.
The Company (1) may deliver Outstanding Debentures of a
series (other than any previously called for redemption) and (2) may apply as
a credit Debentures of a series which have been acquired or redeemed either at
the election of the Company pursuant to the terms of such Debentures or
through the application of permitted optional sinking fund payments pursuant
to the terms of such Debentures or otherwise, in each case in satisfaction of
all or any part of any sinking fund payment with respect to the Debentures of
such series required to be made pursuant to the terms of such Debentures as
provided for by the terms of such series; provided that such Debentures have
not been previously so credited. Such Debentures shall be received and
credited for such purpose by the Trustee at the Redemption Price specified in
such Debentures for redemption through operation of the sinking fund and the
amount of such sinking fund payment shall be reduced accordingly.
Section 1303. Redemption of Debentures for Sinking Fund.
Not less than 45 days prior to each sinking fund payment
date for any series of Debentures, the Company will deliver to the Trustee an
Officers' Certificate specifying the amount of the next ensuing sinking fund
payment for that series pursuant to the terms of that series, the portion
thereof, if any, which is to be satisfied by payment of cash and the portion
thereof, if any, which is to be satisfied by delivering and crediting
Debentures of that series pursuant to Section 1302 and will also deliver to
the Trustee any Debentures to be so delivered. Not less than 15 nor more than
45 days before each such sinking fund payment date the Trustee shall select
the Debentures to be redeemed upon such sinking fund payment date in the
manner specified in Section 1103 and cause notice of the redemption thereof to
be given in the name of and at the expense of the Company in the manner
provided in Section 1104. Such notice having been duly given, the redemption
of such Debentures shall be made upon the terms and in the manner stated in
Sections 1106 and 1107.
ARTICLE FOURTEEN
Subordination of Debentures
Section 1401. Debentures Subordinate to Senior Debt.
The Company covenants and agrees, and each Holder of a
Debenture, by its acceptance thereof, likewise covenants and agrees, that, to
the extent and in the manner hereinafter set forth in this Article (subject to
the provisions of Article Four and Article Twelve), the payment of the
principal of (and premium, if any) and interest on each and all of the
Debentures are hereby expressly made subordinate and subject in right of
payment to the prior payment in full of all amounts then due and payable in
respect of all Senior Debt.
Section 1402. Payment Over of Proceeds Upon Dissolution, Etc.
In the event of (a) any insolvency or bankruptcy case or
proceeding, or any receivership, liquidation, arrangement, reorganization,
debt restructuring or other similar case or proceeding in connection with any
insolvency or bankruptcy proceeding, relative to the Company or to its assets,
or (b) any liquidation, dissolution or other winding up of the Company,
whether voluntary or involuntary and whether or not involving insolvency or
bankruptcy, or (c) any assignment for the benefit of creditors or any other
marshalling of assets and liabilities of the Company, then and in any such
event specified in (a), (b) or (c) above (each such event, if any, herein
sometimes referred to as a "Proceeding") the holders of Senior Debt shall be
entitled to receive payment in full of all amounts due or to become due on or
in respect of all Senior Debt, or provision shall be made for such payment in
cash or cash equivalents or otherwise in a manner satisfactory to the holders
of Senior Debt, before the Holders of the Debentures are entitled to receive
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 subordinated to the payment of the Debentures, such payment or
distribution being hereinafter referred to as "Junior Subordinated Payment"),
on account of principal of (or premium, if any) or interest on the Debentures
or on account of the purchase or other acquisition of Debentures by the
Company or any Subsidiary and to that end the holders of Senior Debt 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 Debentures in any such Proceeding.
In the event that, notwithstanding the foregoing provisions
of this Section, the Trustee or the Holder of any Debenture 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 Senior Debt is 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 Debt, and if such fact shall, at or prior
to the time of such payment or distribution, have been made known to the
Trustee or, as the case may be, such Holder, then and 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 Senior Debt remaining unpaid, to the
extent necessary to pay all Senior Debt in full, after giving effect to any
concurrent payment or distribution to or for the holders of Senior Debt. Any
taxes that have been withheld or deducted from any payment or distribution in
respect of the Debentures, or any taxes that ought to have been withheld or
deducted from any such payment or distribution that have been remitted to the
relevant taxing authority, shall not be considered to be an amount that the
Trustee or the Holder of any Debenture receives for purposes of this Section.
For purposes of this Article only, the words "any payment or
distribution of any kind or character, whether in cash, property or
securities" shall not be deemed 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 which
securities are subordinated in right of payment to all then outstanding Senior
Debt to substantially the same extent as the Debentures are so subordinated as
provided in this Article. 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 of all or substantially all of its
properties and assets as an entirety to another Person or the liquidation or
dissolution of the Company following the sale of all or substantially all of
its properties and assets as an entirety to another Person upon the terms and
conditions set forth in Article Eight shall not be deemed a Proceeding for the
purposes of this Section if the Person formed by such consolidation or into
which the Company is merged or the Person which acquires by sale such
properties and assets as an entirety, as the case may be, shall, as a part of
such consolidation, merger, or sale comply with the conditions set forth in
Article Eight.
Section 1403. Prior Payment to Senior Debt Upon
Acceleration of Debentures.
In the event that any Debentures are declared due and
payable before their Stated Maturity (other than in connection with any
mandatory prepayment of the Debentures of any series in connection with the
redemption of any Preferred Securities of the related series), then and in
such event the holders of the Senior Debt outstanding at the time such
Debentures so become due and payable shall be entitled to receive payment in
full of all amounts due on or in respect of such Senior Debt, or provision
shall be made for such payment in cash or cash equivalents or otherwise in a
manner satisfactory to the holders of Senior Debt, before the Holders of the
Debentures are entitled to receive any payment (including any payment which
may be payable by reason of any Junior Subordinated Payments) by the Company
on account of the principal of (or premium, if any) or interest on the
Debentures or on account of the purchase or other acquisition of Debentures by
the Company or any Subsidiary; provided, however, that nothing in this Section
shall prevent the satisfaction of any sinking fund payment in accordance with
Article Thirteen by delivering and crediting pursuant to Section 1302
Debentures which had been acquired (upon redemption or otherwise) prior to such
declaration of acceleration.
In the event that, notwithstanding the foregoing, the
Company shall make any payment to the Trustee or the Holder of any Debenture
prohibited by the foregoing provisions of this Section, and if such fact
shall, at or prior to the time of such payment, have been made known to the
Trustee or, as the case may be, such Holder, then and in such event such
payment shall be paid over and delivered forthwith to the Company.
The provisions of this Section shall not apply to any
payment with respect to which Section 1402 would be applicable.
Section 1404. No Payment When Senior Debt in Default.
(a) In the event and during the continuation of any default
in the payment of principal of (or premium, if any) or interest on any Senior
Debt, or in the event that any event of default with respect to any Senior
Debt shall have occurred and be continuing and shall have resulted in such
Senior Debt becoming or being declared due and payable prior to the date on
which it would otherwise have become due and payable, unless and until such
default in payment or event of default shall have been cured or waived or shall
have ceased to exist and such acceleration shall have been rescinded or
annulled, or (b) in the event any judicial proceeding shall be pending with
respect to any such default in payment or such event of default, then no
payment (including any payment which may be payable by reason of any Junior
Subordinated Payments) shall be made by the Company on account of principal of
(or premium, if any) or interest on the Debentures or on account of the
purchase or other acquisition of Debentures by the Company or any Subsidiary;
provided, however, that nothing in this Section shall prevent the satisfaction
of any sinking fund payment in accordance with Article Thirteen by delivering
and crediting pursuant to Section 1302 Debentures which have been acquired
(upon redemption or otherwise) prior to such default in payment or event of
default.
In the event that, notwithstanding the foregoing, the
Company shall make any payment to the Trustee or the Holder of any Debenture
prohibited by the foregoing provisions of this Section, and if such fact
shall, at or prior to the time of such payment, have been made known to the
Trustee or, as the case may be, such Holder, then and in such event such
payment shall be paid over and delivered forthwith to the Company.
The provisions of this Section shall not apply to any
payment with respect to which Section 1402 would be applicable.
Section 1405. Payment Permitted If No Default.
Nothing contained in this Article or elsewhere in this
Indenture or in any of the Debentures shall prevent (a) the Company, at any
time except during the pendency of any Proceeding referred to in Section 1402
or under the conditions described in Sections 1403 and 1404, from making
payments at any time of principal of (and premium, if any) or interest on the
Debentures, or (b) the application by the Trustee of any money deposited with
it hereunder to the payment of or on account of the principal of (and premium,
if any) or interest on the Debentures or the retention of such payment by the
Holders, if, at the time of such application by the Trustee, it did not have
knowledge that such payment would have been prohibited by the provisions of
this Article.
Section 1406. Subrogation to Rights of Holders of Senior Debt.
Subject to the payment in full of all Senior Debt, or the
provision for such payment in cash or cash equivalents or otherwise in a
manner satisfactory to the holders of Senior Debt, the Holders of the
Debentures shall be subrogated to the extent of the payments or distributions
made to the holders of such Senior Debt 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 indebtedness of the
Company to substantially the same extent as the Debentures are subordinated to
the Senior Debt and is entitled to like rights of subrogation by reason of any
payments or distributions made to holders of such Senior Debt) to the rights
of the holders of such Senior Debt to receive payments and distributions of
cash, property and securities applicable to the Senior Debt until the
principal of (and premium, if any) and interest on the Debentures shall be
paid in full. If the Trustee or the Holders of the Debentures are not for any
reason entitled to be subrogated to the rights of holders of Senior Debt in
respect of such payment or distribution, then the Trustee or the Holders of
the Debentures may require each holder of Senior Debt to whom any such payment
or distribution is made as a condition to such payment or distribution to
assign its Senior Debt to the extent of such payment or distribution and all
rights with respect thereto to the Trustee on behalf of the Holders. Such
assignment shall not be effective until such time as all Senior Debt has been
paid in full or payment thereof provided for. For purposes of such
subrogation or assignment, no payments or distributions to the holders of the
Senior Debt of any cash, property or securities to which the Holders of the
Debentures or the Trustee would be entitled except for the provisions of this
Article, and no payments over pursuant to the provisions of this Article to
the holders of Senior Debt by Holders of the Debentures or the Trustee, shall,
as among the Company, its creditors other than holders of Senior Debt, and the
Holders of the Debentures, be deemed to be a payment or distribution by the
Company to or on account of the Senior Debt.
Section 1407. Provisions Solely to Define Relative Rights.
The provisions of this Article are and are intended solely
for the purpose of defining the relative rights of the Holders of the
Debentures on the one hand and the holders of Senior Debt on the other hand.
Nothing contained in this Article or elsewhere in this Indenture or in the
Debentures is intended to or shall (a) impair, as among the Company, its
creditors other than holders of Senior Debt, and the Holders of the
Debentures, the obligations of the Company, which are absolute and
unconditional (and which, subject to the rights under this Article of the
holders of Senior Debt, are intended to rank equally with all other general
unsecured obligations of the Company), to pay to the Holders of the Debentures
the principal of (and premium, if any) and interest on the Debentures as and
when the same shall become due and payable in accordance with their terms; or
(b) affect the relative rights against the Company of the Holders of the
Debentures and creditors of the Company other than the holders of Senior Debt;
or (c) prevent the Trustee or the Holder of any Debenture from exercising all
remedies otherwise permitted by applicable law upon default under this
Indenture including, without limitation, filing and voting claims in any
Proceeding, subject to the rights, if any, under this Article of the holders
of Senior Debt to receive cash, property and securities otherwise payable or
deliverable to the Trustee or such Holder.
Section 1408. Trustee to Effectuate Subordination.
Each Holder of a Debenture by his or her acceptance thereof
authorizes and directs the Trustee on his or her behalf to take such action as
may be necessary or appropriate to acknowledge or effectuate the subordination
provided in this Article and appoints the Trustee his or her attorney-in-fact
for any and all such purposes.
Section 1409. No Waiver of Subordination Provisions.
No right of any present or future holder of any Senior Debt
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
Indenture, regardless of any knowledge thereof that any such holder may have
or be otherwise charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Debt may, at any time and from time to time,
without the consent of or notice to the Trustee or the Holders of the
Debentures, without incurring responsibility to the Holders of the Debentures,
and without impairing or releasing the subordination provided in this Article
or the obligations hereunder of the Holders of the Debentures to the holders
of Senior Debt, 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
or increase, Senior Debt, or otherwise amend or supplement in any manner
Senior Debt or any instrument evidencing the same or any agreement under which
Senior Debt is outstanding; (ii) sell, exchange, release or otherwise deal
with any property pledged, mortgaged or otherwise securing Senior Debt; (iii)
release any Person liable in any manner for the collection of Senior Debt; and
(iv) exercise or refrain from exercising any rights against the Company and
any other Person.
Section 1410. Notice to Trustee.
The Company shall give prompt written notice to the Trustee
of any fact known to the Company which would prohibit the making of any
payment to or by the Trustee in respect of the Debentures. Notwithstanding
the provisions of this Article or any other provision of this Indenture, the
Trustee shall not be charged with knowledge of the existence of any facts
which would prohibit the making of any payment to or by the Trustee in respect
of the Debentures, unless and until the Trustee shall have received written
notice thereof from the Company or a holder of Senior Debt or from any
trustee, agent or representative therefor; and, prior to the receipt of any
such written notice, the Trustee, subject to the provisions of Section 601,
shall be entitled in all respects to assume that no such facts exist;
provided, however, that if the Trustee shall not have received the notice
provided for in this Section at least two Business Days prior to the date upon
which by the terms hereof any money may become payable for any purpose
(including, without limitation, the payment of the principal of (and premium,
if any) or interest on any Debenture), then, anything herein contained to the
contrary notwithstanding, the Trustee shall have full power and authority to
receive such money and to apply the same to the purpose for which such money
was received and shall not be affected by any notice to the contrary which may
be received by it within two Business Days prior to such date.
Subject to the provisions of Section 601, the Trustee shall
be entitled to rely on the delivery to it of a written notice by a Person
representing himself or herself to be a holder of Senior Debt (or a trustee,
agent or representative therefor) to establish that such notice has been given
by a holder of Senior Debt (or a trustee, agent or representative therefor).
In the event that the Trustee determines in good faith that further evidence
is required with respect to the right of any Person as a holder of Senior Debt
to participate in any payment or distribution pursuant to this Article, the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Debt held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article, and if such evidence is not furnished, the Trustee
may defer any payment to such Person pending judicial determination as to the
right of such Person to receive such payment.
Section 1411. Reliance on Judicial Order or Certificate of
Liquidating Agent.
Upon any payment or distribution of assets of the Company
referred to in this Article, the Trustee, subject to the provisions of Section
601, and the Holders of the Debentures shall be entitled to rely upon any
order or decree entered by any court of competent jurisdiction in which such
Proceeding is pending, or a certificate of the trustee in bankruptcy,
receiver, liquidating trustee, custodian, assignee for the benefit of
creditors, agent or other Person making such payment or distribution, delivered
to the Trustee or to the Holders of Debentures, for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Debt 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.
Section 1412. Trustee Not Fiduciary For Holders of Senior Debt.
The Trustee, in its capacity as trustee under this
Indenture, shall not be deemed to owe any fiduciary duty to the holders of
Senior Debt and shall not be liable to any such holders if it shall in good
faith mistakenly pay over or distribute to Holders of Debentures or to the
Company or to any other Person cash, property or securities to which any
holders of Senior Debt shall be entitled by virtue of this Article or
otherwise.
Section 1413. Rights of Trustee as Holder of Senior Debt;
Preservation of Trustee's Rights.
The Trustee in its individual capacity shall be entitled to
all the rights set forth in this Article with respect to any Senior Debt which
may at any time be held by it, to the same extent as any other holder of
Senior Debt, and nothing in this Indenture shall deprive the Trustee of any of
its rights as such holder.
Nothing in this Article shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 607.
Section 1414. Article Applicable to Paying Agents.
In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Company and be then acting hereunder, the
term "Trustee" as used in this Article shall in such case (unless the context
otherwise requires) be construed as extending to and including such Paying
Agent within its meaning as fully for all intents and purposes as if such
Paying Agent were named in this Article in addition to or in place of the
Trustee.
Section 1415. Defeasance of This Article Fourteen.
The subordination of the Debentures provided by this Article
Fourteen is expressly made subject to the provisions for defeasance or
covenant defeasance in Article Twelve and, anything herein to the contrary
notwithstanding, upon the effectiveness of any such defeasance or covenant
defeasance, the Debentures then outstanding shall thereupon cease to be
subordinated pursuant to this Article Fourteen.
ARTICLE FIFTEEN
Miscellaneous
Section 1501. Assignment; Binding Effect.
The Company shall have the right at all times to assign any
of its rights or obligations under this Indenture to a direct or indirect
wholly owned Subsidiary of the Company other than any Subsidiary that is an
insurance company; provided that, in the event of any such assignment, the
Company shall remain jointly and severally liable for all such obligations.
The Company may not otherwise assign any of its obligations under this
Indenture. Except as otherwise provided in this Indenture, Capital may not
assign any of its rights under this Indenture without the prior written
consent of the Company. Subject to the foregoing, this Indenture shall be
binding upon and inure to the benefit of the Company and the Holders and, to
the extent specifically set forth herein, the holders of Senior Debt and
Preferred Securities, from time to time of the Debentures and their respective
successors and assigns.
Section 1502. Third Party Beneficiaries.
The Company hereby acknowledges that, to the extent
specifically set forth herein, prior to a Security Exchange with respect to
the Debentures of any series, the holders of the Preferred Securities of the
related series shall expressly be third party beneficiaries of this Indenture.
Section 1503. Set-off.
Notwithstanding anything to the contrary herein, prior to
any Security Exchange with respect to the Debentures of any series, the
Company shall have the right to set-off any payment with respect to the
Debentures of such series with and to the extent the Company has theretofore
made, or is concurrently on the date of such payment making, a payment under
the Guarantee with respect to Preferred Securities of the related series.
This instrument may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all such counterparts shall together constitute but one and the same
instrument.
_____________________________
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
AETNA LIFE AND CASUALTY
COMPANY
By
Attest:
THE FIRST NATIONAL BANK
OF CHICAGO
By
Attest:
STATE OF CONNECTICUT )
) ss.:
COUNTY OF HARTFORD )
On the day of , 1994, before me personally
came , to me known, who, being by me duly sworn, did
depose and say that (s)he is of AETNA LIFE AND CASUALTY
COMPANY, one of the corporations described in and which executed the foregoing
instrument; that (s)he knows the seal of said corporation; that the seal
affixed to said instrument is such corporate seal; that it was so affixed by
authority of the Board of Directors of said corporation, and that (s)he signed
her/his name thereto by like authority.
STATE OF ILLINOIS )
) ss.:
COUNTY OF )
On the day of , 1994, before me
personally came , to me known, who, being by me
duly sworn, did depose and say that (s)he is of THE
FIRST NATIONAL BANK OF CHICAGO, one of the corporations described in and which
executed the foregoing instrument; that (s)he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation, and that (s)he signed her/his name thereto by like authority.
EXHIBIT 4
AETNA LIFE AND CASUALTY COMPANY
Certificate of Designated Officer
Alfred P. Quirk, Jr., of Aetna Life and Casualty Company, a
Connecticut insurance corporation (the "Company"), pursuant to resolutions
adopted by the Board of Directors of the Company on March 25, 1994 (the
"Resolutions"), hereby certifies that there is hereby approved and established
pursuant to Section 301 of the Indenture, dated as of November 1, 1994 (the
"Indenture"), between the Company and The First National Bank of Chicago, as
Trustee, a series of Debentures under the Indenture whose terms shall be as
follows (capitalized terms used but not defined herein have the meanings
ascribed thereto in the Indenture):
1. There shall be a series of Debentures designated
"9 1/2% Series A Subordinated Debentures due November 22, 2024"
(the "Series A Debentures").
2. The aggregate principal amount of the Series A Debentures which
may be authenticated and delivered shall be limited to
$316,455,696 (or up to $363,924,051 aggregate principal amount
if and to the extent the overallotment option granted to the
underwriters of the 9 1/2% Cumulative Monthly Income Preferred
Securities, Series A of Capital (the "Series A Preferred
Securities") is exercised) (except, in each case, for Series A
Debentures authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Series A
Debentures pursuant to Section 304, 305, 306, 906 or 1107 of the
Indenture and except for Debentures which, pursuant to Section
303 of the Indenture, are deemed never to have been
authenticated and delivered thereunder).
3. Subject to the provisions of paragraphs 4 and 5, the entire
principal amount of the Series A Debentures shall become due
and payable, together with any accrued and unpaid interest
thereon, including Additional Interest, if any, on the earlier
of (a) November 22, 2024 (subject to the Company's right to
exchange the Series A Debentures for new Debentures or reborrow
the proceeds from the repayment of such Debentures pursuant to
paragraph 6) and (b) the date upon which Capital shall have
been dissolved; provided that, in the event the Series A
Preferred Securities are exchanged for the Series A Debentures
in the manner set forth in the Written Action establishing the
Series A Preferred Securities (the "Series A Security
Exchange") the Series A Debentures will mature on the date set
forth in clause (a), whether or not Capital shall have been
dissolved in connection with the Series A Security Exchange.
4. Notwithstanding the provisions of paragraph 3, if Capital
redeems any Series A Preferred Securities for cash in
accordance with the terms thereof, the Series A Debentures
shall become due and payable in a principal amount equal to the
aggregate stated liquidation preference of the Series A
Preferred Securities so redeemed, together with any and all
accrued interest thereon, including Additional Interest, if
any, on the portion being redeemed. Any payment pursuant to
this paragraph 4 shall be made prior to 12:00 noon, New York
time, on the date fixed for such redemption of Series A
Preferred Securities or at such other time on such earlier date
as Capital and the Company shall agree.
5. Upon not less than 30 nor more than 60 days' prior notice, the
Company shall have the right to redeem the Series A Debentures
(together with any accrued but unpaid interest, including
Additional Interest, if any, on the portion being redeemed),
without premium or penalty, in whole or in part,
(i) at any time on or after November 30, 1999; and
(ii) at any time, if (a) the Series A Preferred
Securities are outstanding and (b) there shall have
occurred after November 15, 1994 a change in any
applicable U.S. law or regulation or in the
interpretation thereof (including but not limited to the
enactment or imminent enactment of any legislation, the
publication of any judicial decisions, regulatory
rulings, regulatory procedures, or notices or
announcements (including notices or announcements of
intent to adopt such procedures or regulations), or a
change in the official position or in the interpretation
of any law or regulation by any legislative body, court,
governmental authority or regulatory body, irrespective of
the manner in which such change is made known), and the
Company shall have been advised by legal counsel (which
counsel is not an employee of the Company or Capital)
that, as a result of such change, there exists more than
an insubstantial risk that (i) the Company will be
precluded from deducting the interest paid on such Series
A Debentures for federal income tax purposes or (ii)
Capital will be subject to federal income tax with
respect to the interest received on such Series A
Debentures.
If at any time after the issuance of the Series A Preferred
Securities, the Company is or, in the opinion of counsel (which
counsel is not an employee of the Company or Capital), would be
required to pay Additional Interest with respect to any Series
A Debentures, the Company shall also have the right to redeem
without premium or penalty, in whole or in part (together with
accrued but unpaid interest, including Additional Interest, if
any, on the portion being redeemed) the Series A Debentures;
provided that in the event that the Company is required to pay
Additional Interest as a consequence of Capital's being
required to pay Additional Amounts, then the Company may only
redeem Series A Debentures in a principal amount not to exceed
the aggregate stated liquidation preference of the Series A
Preferred Securities with respect to which such Additional
Amounts are required to be paid. In addition, if the Company
or any of its subsidiaries purchases Series A Preferred
Securities by tender, in the open market or by private
agreement, the Company shall have the right to redeem Series A
Debentures, without premium or penalty, in an amount not to
exceed the aggregate stated liquidation preference of the
Series A Preferred Securities so purchased, together with any
accrued and unpaid interest thereon, including Additional
Interest, if any, on the portion being redeemed.
6. Notwithstanding the provisions of paragraphs 3 and 4, prior to
a Series A Security Exchange the Company may, with Capital's
consent, (i) in lieu of repaying the Series A Debentures when
due or optionally redeeming such Series A Debentures, exchange
such Series A Debentures for new Debentures with an equal
aggregate principal amount or (ii) if the Company repays such
Series A Debentures when due or optionally redeems such Series
A Debentures, reborrow the proceeds from such repayment or
redemption which reborrowing shall be evidenced by new
Debentures; provided that the Company may not so exchange the
Series A Debentures for new Debentures or reborrow the proceeds
from the repayment or redemption thereof unless Capital owns
all of such Series A Debentures and the following conditions are
satisfied (which satisfaction, in the case of clauses (f)
through (j) shall be determined in the judgment of the Managing
Members and Capital's financial advisor (selected by the
Managing Members and who shall be unaffiliated with the Company
and shall be among the 30 largest investment banking firms,
measured by total capital, in the United States at the time of
the issuance of the new Debentures that will evidence the new
loan to be made in connection with such exchange or
reborrowing)): (a) the Company is not bankrupt, insolvent or in
liquidation, (b) the Company is not in default in the payment
of any interest or principal under the Indenture, (c) the
Company has made timely payments on the Series A Debentures for
the immediately preceding 24 months (and has not elected
pursuant to paragraph 8 hereof to extend any interest payment
period for the Series A Debentures during such 24 month
period), (d) such new loan will mature no later than the
earlier of (1) the 49th anniversary of the date of the initial
issuance of the Series A Debentures and (2) the 30th
anniversary of the date such new loan is made, (e) Capital is
not in arrears on payments of dividends on the Series A
Preferred Securities, (f) the Company is expected to be able to
make timely payment of principal of and interest on such new
loan, (g) such new loan is being made on terms, and under
circumstances, that are consistent with those which a lender
would then require for a loan to an unrelated party, (h) such
new loan is being made at a rate sufficient to provide payments
equal to or greater than the amount of dividend payments
required under the Series A Preferred Securities, (i) such new
loan is being made for a term that is consistent with market
circumstances and the Company's financial condition and (j)
immediately prior to the making of such new loan, the senior
unsecured long-term debt of the Company is (or if no such debt
is outstanding, would be) rated not less than BBB (or the
equivalent) by Standard & Poor's Corporation and Baa2 (or the
equivalent) by Moody's Investors Service, Inc. and the
subordinated unsecured long-term debt of the Company (or, if
more than one issue of such subordinated debt is outstanding,
the most junior of such issues) is (or if no such debt is
outstanding, would be) rated not less than BBB- (or the
equivalent) by Standard & Poor's Corporation and Baa3 by
Moody's Investors Service, Inc. (or if either of such rating
organizations is not then rating the Company's senior or
subordinated unsecured long-term debt, as the case may be, the
equivalent of such ratings by any other "nationally recognized
statistical rating organization," as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Securities
Act of 1933, as amended). Except as otherwise provided in the
immediately preceding sentence, the terms of any new Debentures
issued upon the exchange of the Series A Debentures or upon the
reborrowing of the proceeds from the repayment of the Series A
Debentures pursuant to this paragraph 6 shall be substantially
similar to those of the Series A Debentures.
7. Each Series A Debenture shall bear interest at the annual rate
of 9 1/2% accruing from the date such Debenture is originally
issued or from the most recent Interest Payment Date (as
defined below) to which interest has been paid or duly provided
for, as the case may be, until maturity. To the extent
permitted by applicable law, the Company will also pay interest
on overdue installments of interest and principal at such rate.
Subject to the provisions of paragraph 8 below, such interest
shall be payable monthly in arrears on the last day of each
calendar month (an "Interest Payment Date"), commencing on
November 30, 1994 to the Persons in whose names the Series A
Debentures are registered at the close of business on the
relevant record date (each a "Regular Record Date"), which
shall be one Business Day prior to the relevant Interest
Payment Date; provided that in the event that the Series A
Debentures are not in book-entry-only form at any time
following a Series A Security Exchange, the Regular Record Date
for any Interest Payment Date shall be the fifteenth day of the
month in which such Interest Payment Date occurs.
8. Notwithstanding the provisions of paragraph 7, the Company
shall have the right at any time or times during the term of
the Series A Debentures, so long as the Company is not in
default in the payment of interest under the Indenture, to
extend the interest payment period for the Series A Debentures
up to 60 months, at the end of which period the Company will
pay all interest then accrued and unpaid on the Series A
Debentures (together with interest thereon at the rate
specified for the Series A Debentures to the extent permitted
by applicable law); provided that any such extended interest
period may only be selected with respect to the Series A
Debentures if an extended interest period of identical length
is simultaneously selected for the Debentures of all other
series outstanding. Prior to the termination of any such
extended interest payment period the Company may further extend
the interest payment period for the Series A Debentures;
provided that such extended interest payment period for the
Series A Debentures, together with all such further extensions
thereof, may not exceed 60 months. Following the termination of
any extended interest payment period, if the Company has paid
all accrued and unpaid interest required by the Series A
Debentures for such period, then the Company shall have the
right to again extend the interest payment period up to 60
months as herein described. Prior to any Series A Security
Exchange, the Company shall give Capital notice of its
selection of any extended interest payment period for the
Series A Debentures one Business Day prior to the earlier of
(i) the date the related dividend on the Series A Preferred
Securities is payable and (ii) the date on which Capital is
required to give notice of the record or payment date of such
dividend to the New York Stock Exchange or other applicable
self-regulatory organization or to holders of the Series A
Preferred Securities, but in any event not less than two
Business Days prior to such record date. The Company will
cause Capital to give such notice of the Company's selection of
any extended interest payment period to the holders of the
Series A Preferred Securities. After any Series A Security
Exchange, the Company shall give the holders of the Series A
Debentures notice of its selection of any extended interest
payment period for the Series A Debentures not less than two
Business Days prior to the Regular Record Date for the first
interest payment for which such extension will be effective.
During any extended interest period, the Company shall not pay
or declare any dividends on, or redeem, purchase, acquire or
make a liquidation payment with respect to, any of its capital
stock (other than (i) acquisitions of shares of Common Stock in
connection with the satisfaction by the Company of its
obligations under any employee benefit plans and (ii)
redemptions of any share purchase rights issued by the Company
pursuant to the Company's Share Purchase Rights Plan adopted
on October 27, 1989, as amended from time to time, or the
declaration of a dividend of similar share purchase rights in
the future).
9. Payment of the principal of and interest on the Series A
Debentures will be made at the office or agency of the Company
maintained for such purposes in the City of Hartford,
Connecticut (the "Place of Payment"); provided, however, that
at the option of the Company payment of interest may be made by
check mailed to the address of the Person entitled thereto as
such address shall appear in the Debenture Register.
Notwithstanding the foregoing, so long as Capital is the holder
of all the Series A Debentures, the payment of the principal of
and interest (including Additional Interest, if any) on the
Series A Debentures will be made at such place and to such
account as may be designated by Capital.
10. The Company shall not be obligated to redeem or purchase the
Series A Debentures pursuant to any sinking fund or analogous
provision, or at the option of any Holder thereof.
11. If immediately prior to any Series A Security Exchange, the
Series A Preferred Securities are represented by one or more
global securities registered in the name of The Depository Trust
Company ("DTC") or any successor securities depositary or their
respective nominees, the Series A Debentures, upon such Series
A Security Exchange, shall be represented by one or more Global
Debentures registered in the name of DTC or any successor
security depositary, which shall act as the Depositary for the
Series A Debentures or their respective nominees.
12. In the event of a Series A Security Exchange, First Chicago
Trust Company of New York shall act as paying agent and
registrar with respect to the Series A Debentures in the event
the Series A Debentures are no longer represented by one or
more Global Debentures.
13. After the date fixed for a Series A Security
Exchange, any certificates representing Series A Preferred
Securities not held by DTC or any successor securities
depositary or their respective nominees and not surrendered for
exchange will be deemed to represent Series A Debentures having
a principal amount and accrued and unpaid interest equal to the
redemption price of such Preferred Securities until such
certificates are surrendered to Capital or its agent for
exchange; provided, however, that notwithstanding the
foregoing, until such certificates are so surrendered, no
payments of interest or principal will be made with respect to
such Series A Debentures.
14. The certificates evidencing the Series A Debentures shall be
substantially in the form attached hereto as Annex A, with such
changes as the officer executing the same shall approve, such
approval to be evidenced by such officer's manual or facsimile
signature.
IN WITNESS WHEREOF, I have hereunto signed my name as of this
15th day of November, 1994.
__________________________
Name:
Title:
ANNEX A
AETNA LIFE AND CASUALTY COMPANY
9 1/2% Series A Subordinated Debentures Due
November 22, 2024
No. R- $
AETNA LIFE AND CASUALTY COMPANY, a Connecticut insurance
corporation (herein called the "Company", which term includes any successor
Person under the Indenture hereinafter referred to), for value received, hereby
promises to pay to Aetna Capital L.L.C. ("Capital"), or registered assigns,
the principal sum of Dollars on the earlier of (i)
November 22, 2024 (subject to the Company's right to exchange this Debenture
for a new Debenture or reborrow the proceeds from the repayment of this
Debenture upon the terms and subject to the conditions set forth in the
Indenture) and (ii) the date upon which Capital is dissolved; provided that,
in the event of a Series A Security Exchange, this Debenture will mature on
the date set forth in clause (i), whether or not Capital shall have been
dissolved in connection with such Exchange, and to pay interest thereon at a
rate of 9 1/2% per annum plus Additional Interest, if any, accruing from
November 22, 1994 or from the most recent Interest Payment Date (as defined
below) to which interest has been paid or duly provided for until maturity and
(to the extent that the payment of such interest shall be legally enforceable)
at the rate of 9 1/2% per annum on any overdue principal and on any overdue
instalment of interest or Additional Interest. Except as described below,
such interest shall be payable monthly in arrears on the last day of each
calendar month, commencing on November 30, 1994; provided that in the event
that any date on which interest is payable on this Debenture is not a Business
Day, then payment of the 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) except that, if such Business Day is in
the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and
effect as if made on such date (any such date on which interest is paid, an
"Interest Payment Date"). Notwithstanding the foregoing, subject to the terms
and conditions set forth in the Indenture, the Company shall have the right at
any time or times prior to the maturity hereof, so long as the Company is not
in default in the payment of interest under the Indenture to extend the
interest payment period for this Debenture up to 60 months, at the end of
which period the Company will pay all interest then accrued and unpaid on this
Debenture (together with interest thereon at the rate of 9 1/2% to the extent
the payment of such interest shall be legally enforceable). Prior to the
termination of any such extended interest payment period the Company may
further extend the interest payment period for this Debenture; provided that
such extended interest payment period for this Debenture, together with all
such further extensions thereof, may not exceed 60 months. Following the
termination of any extended interest payment period, if the Company has paid
all accrued and unpaid interest required by this Debenture for such period,
then the Company shall have the right to again extend the interest payment
period up to 60 months.
The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in the Indenture,
be paid to the Person in whose name this Debenture (or one or more Predecessor
Debentures) is registered at the close of business on the Regular Record Date
for such interest, which, except as otherwise provided in the Indenture, shall
be the Business Day preceding such Interest Payment Date. Any such interest
not so punctually paid or duly provided for will forthwith cease to be payable
to the Holder on such Regular Record Date and may either be paid to the Person
in whose name this Debenture (or one or more Predecessor Debentures) is
registered at the close of business on a Special Record Date for the payment
of such Defaulted Interest to be fixed by the Trustee, notice whereof shall
be given to Holders of Debentures of this series not less than 10 days prior
to such Special Record Date, or be paid at any time in any other lawful manner
not inconsistent with the requirements of any securities exchange on which the
Debentures of this series may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in said Indenture.
The indebtedness evidenced by this Debenture is, to the
extent provided in the Indenture, subordinate and subject in right of payment
to the prior payment in full of all Senior Debt, and this Debenture is issued
subject to the provisions of the Indenture with respect thereto. Each Holder
of this Debenture, by accepting the same, (a) agrees to and shall be bound by
such provisions, (b) authorizes and directs the Trustee on his behalf to take
such action as may be necessary or appropriate to effectuate the subordination
so provided and (c) appoints the Trustee his attorney-in-fact for any and all
such purposes.
Payment of the principal of and interest on this Debenture
will be made at the office or agency of the Company maintained for that
purpose in Hartford, Connecticut, in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts; provided, however, that at the option of the Company
payment of interest may be made by check mailed to the address of the Person
entitled thereto as such address shall appear in the Debenture Register.
Notwithstanding the foregoing, so long as the Holder of this Debenture is
Capital, the payment of the principal of and interest (including Additional
Interest, if any) on this Debenture will be made at such place and to such
account as may be designated by Capital.
Reference is hereby made to the further provisions of this
Debenture set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Debenture shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument
to be duly executed under its corporate seal.
Dated:
AETNA LIFE AND
CASUALTY COMPANY
By___________________
Attest:
____________________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Debentures of the series designated
therein referred to in the within-mentioned Indenture.
THE FIRST NATIONAL
BANK OF CHICAGO
As Trustee
BY__________________
Authorized Officer
This Debenture is one of a duly authorized issue of
securities of the Company (herein called the "Debentures"), issued and to be
issued in one or more series under an Indenture, dated as of November 1, 1994
(herein called the "Indenture"), between the Company and The First National
Bank of Chicago, as Trustee (herein called the "Trustee", which term includes
any successor trustee under the Indenture), to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of
the respective rights, limitations of rights, duties and immunities thereunder
of the Company, the Trustee and the Holders of the Debentures and, to the
extent specifically set forth in the Indenture, the holders of Senior Debt and
Preferred Securities, and of the terms upon which the Debentures are, and are
to be, authenticated and delivered. This Debenture is one of the series
designated on the face hereof, limited in aggregate principal amount to
$316,455,696 (or up to $363,924,051 aggregate principal amount if and to
the extent the over-allotment option granted to the underwriters of the
Series A Preferred Securities is exercised).
If Capital redeems the Series A Preferred Securities for
cash in accordance with the terms thereof, the Debentures of this series shall
become due and payable in a principal amount equal to the aggregate stated
liquidation preference of the Series A Preferred Securities so redeemed,
together with any and all accrued interest thereon, including Additional
Interest, if any, on the portion being redeemed.
Upon not less than 30 nor more than 60 days' prior notice,
the Company shall have the right to redeem the Debentures of this series
(together with any accrued but unpaid interest, including Additional Interest,
if any, on the portion being redeemed), without premium or penalty, in whole
or in part,
(1) at any time on or after November 30, 1999; and
(2) at any time, if (a) the Series A Preferred Securities
are outstanding and (b) there shall have occurred after November
15, 1994 a change in any applicable U.S. law or regulation or in
the interpretation thereof (including but not limited to the
enactment or imminent enactment of any legislation, the
publication of any judicial decisions, regulatory rulings,
regulatory procedures, or notices or announcements (including
notices or announcements of intent to adopt such procedures or
regulations), or a change in the official position or in the
interpretation of any law or regulation by any legislative body,
court, governmental authority or regulatory body, irrespective of
the manner in which such change is made known), and the Company
shall have been advised by legal counsel (which counsel is not an
employee of the Company or Capital) that, as a result of such
change, there exists more than an insubstantial risk that (i) the
Company will be precluded from deducting the interest paid on the
Debentures of this series for federal income tax purposes or (ii)
Capital will be subject to federal income tax with respect to the
interest received on the Debentures of this series.
If at any time after the issuance of the Series A Preferred
Securities, the Company is or, in the opinion of counsel (which counsel is not
an employee of the Company or Capital), would be required to pay Additional
Interest with respect to any Debentures of this series, the Company shall also
have the right to redeem without premium or penalty, in whole or in part
(together with accrued but unpaid interest, including Additional Interest, if
any, on the portion being redeemed) the Debentures of this series; provided
that in the event that the Company is required to pay Additional Interest as a
consequence of Capital's being required to pay Additional Amounts, then the
Company may only redeem Debentures of this series in a principal amount not to
exceed the aggregate stated liquidation preference of the Series A Preferred
Securities with respect to which such Additional Amounts are required to be
paid. In addition, if the Company or any of its subsidiaries purchases Series
A Preferred Securities by tender, in the open market or by private agreement,
the Company shall have the right to redeem Debentures of this series, without
premium or penalty, in an amount not to exceed the aggregate stated
liquidation preference of the Series A Preferred Securities so purchased,
together with any accrued and unpaid interest thereon, including Additional
Interest, if any, on the portion being redeemed.
In the event of any prepayment or redemption of this
Debenture in part only, a new Debenture or Debentures of this series and of
like tenor for the portion hereof which is not being prepaid or redeemed, as
the case may be, will be issued in the name of the Holder hereof upon the
cancellation hereof.
The Indenture contains provisions for defeasance at any time
of (1) the entire indebtedness of this Debenture or (2) certain restrictive
covenants and Events of Default with respect to this Debenture, in each case
upon compliance with certain conditions set forth in the Indenture.
If an Event of Default with respect to Debentures of this
series shall occur and be continuing, the principal of the Debentures of this
series and accrued interest (including Additional Interest, if any) thereon
may be declared due and payable in the manner and with the effect provided in
the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Debentures of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of not less than a majority in
aggregate principal amount of the Debentures at the time Outstanding of each
series to be affected (and, prior to a Security Exchange with respect to the
Debentures of any series affected thereby, the consent of the holders of not
less than a majority in stated liquidation preference of the Preferred
Securities of the related series). The Indenture also contains provisions
permitting the Holders of specified percentages in principal amount of the
Debentures of each series at the time Outstanding, on behalf of the Holders of
all Debentures of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences (except that prior to a Security Exchange with respect to
the Debentures of such series, any such waiver will also require the consent
of the holders of specified percentages of the stated liquidation preference
of the Preferred Securities of the related series). Any such consent or
waiver by the Holder of this Debenture shall be conclusive and binding upon
such Holder and upon all future Holders of this Debenture and of any Debenture
issued upon the registration of transfer hereof or in exchange hereof or in
lieu hereof, whether or not notation of such consent or waiver is made upon
this Debenture.
Subject to Section 1503 of the Indenture, no reference
herein to the Indenture (other than such Section) and no provisions of this
Debenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium and
interest on this Debenture at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Debenture is registerable
in the Debenture Register, upon surrender of this Debenture for registration of
transfer at the office or agency of the Company in any place where the
principal of and any premium and interest on this Debenture are payable, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Debenture Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Debentures of this series and of like tenor, of authorized
denominations and for the same aggregate principal amount, will be issued to
the designated transferee or transferees; provided that prior to a Security
Exchange with respect to the Debentures of this series, the Debentures of this
series may not be transferred without the written consent of the Company.
The Debentures of this series are issuable only in
registered form without coupons in denominations of $25.00 and any integral
multiple thereof. As provided in the Indenture and subject to certain
limitations therein set forth, Debentures of this series are exchangeable for
a like aggregate principal amount of Debentures of this series and of like
tenor of a different authorized denomination, as requested by the Holder
surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Debenture for registration
of transfer, the Company, the Trustee and any agent of the Company or the
Trustee may treat the Person in whose name this Debenture is registered as the
owner hereof for all purposes, whether or not this Debenture is overdue, and
neither the Company, the Trustee nor any such agent shall be affected by
notice to the contrary.
No recourse shall be had for the payment of the principal of
or interest (including Additional Interest, if any) on this Debenture, or for
any claim based hereon, or otherwise in respect hereof, or based on or in
respect of the Indenture or any indenture supplemental thereto, against any
incorporator, stockholder, officer or director, as such, past, present or
future, of the Company or of any successor corporation, 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 issue hereof, expressly waived
and released.
All terms used in this Debenture which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
EXHIBIT 5
AETNA LIFE AND CASUALTY COMPANY
9 1/2% Series A Subordinated Debentures Due
November 22, 2024
No. R-1 $348,101,266
AETNA LIFE AND CASUALTY COMPANY, a Connecticut insurance
corporation (herein called the "Company", which term includes any successor
Person under the Indenture hereinafter referred to), for value received, hereby
promises to pay to Aetna Capital L.L.C. ("Capital"), or registered assigns,
the principal sum of Three Hundred Forty-Eight Million, One Hundred One
Thousand, Two Hundred Sixty-Six Dollars on the earlier of (i) November 22,
2024 (subject to the Company's right to exchange this Debenture for a new
Debenture or reborrow the proceeds from the repayment of this Debenture upon
the terms and subject to the conditions set forth in the Indenture) and (ii)
the date upon which Capital is dissolved; provided that, in the event of a
Series A Security Exchange, this Debenture will mature on the date set forth
in clause (i), whether or not Capital shall have been dissolved in connection
with such Exchange, and to pay interest thereon at a rate of 9 1/2% per annum
plus Additional Interest, if any, accruing from November 22, 1994 or from the
most recent Interest Payment Date (as defined below) to which interest has
been paid or duly provided for until maturity and (to the extent that the
payment of such interest shall be legally enforceable) at the rate of 9 1/2%
per annum on any overdue principal and on any overdue instalment of interest
or Additional Interest. Except as described below, such interest shall be
payable monthly in arrears on the last day of each calendar month, commencing
on November 30, 1994; provided that in the event that any date on which
interest is payable on this Debenture is not a Business Day, then payment of
the 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) except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding
Business Day, in each case with the same force and effect as if made on such
date (any such date on which interest is paid, an "Interest Payment Date").
Notwithstanding the foregoing, subject to the terms and conditions set forth
in the Indenture, the Company shall have the right at any time or times prior
to the maturity hereof, so long as the Company is not in default in the
payment of interest under the Indenture to extend the interest payment period
for this Debenture up to 60 months, at the end of which period the Company will
pay all interest then accrued and unpaid on this Debenture (together with
interest thereon at the rate of 9 1/2% to the extent the payment of such
interest shall be legally enforceable). Prior to the termination of any such
extended interest payment period the Company may further extend the interest
payment period for this Debenture; provided that such extended interest payment
period for this Debenture, together with all such further extensions thereof,
may not exceed 60 months. Following the termination of any extended interest
payment period, if the Company has paid all accrued and unpaid interest
required by this Debenture for such period, then the Company shall have the
right to again extend the interest payment period up to 60 months.
The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in the Indenture,
be paid to the Person in whose name this Debenture (or one or more Predecessor
Debentures) is registered at the close of business on the Regular Record Date
for such interest, which, except as otherwise provided in the Indenture, shall
be the Business Day preceding such Interest Payment Date. Any such interest
not so punctually paid or duly provided for will forthwith cease to be payable
to the Holder on such Regular Record Date and may either be paid to the Person
in whose name this Debenture (or one or more Predecessor Debentures) is
registered at the close of business on a Special Record Date for the payment
of such Defaulted Interest to be fixed by the Trustee, notice whereof shall
be given to Holders of Debentures of this series not less than 10 days prior
to such Special Record Date, or be paid at any time in any other lawful manner
not inconsistent with the requirements of any securities exchange on which the
Debentures of this series may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in said Indenture.
The indebtedness evidenced by this Debenture is, to the
extent provided in the Indenture, subordinate and subject in right of payment
to the prior payment in full of all Senior Debt, and this Debenture is issued
subject to the provisions of the Indenture with respect thereto. Each Holder
of this Debenture, by accepting the same, (a) agrees to and shall be bound by
such provisions, (b) authorizes and directs the Trustee on his behalf to take
such action as may be necessary or appropriate to effectuate the subordination
so provided and (c) appoints the Trustee his attorney-in-fact for any and all
such purposes.
Payment of the principal of and interest on this Debenture
will be made at the office or agency of the Company maintained for that
purpose in Hartford, Connecticut, in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts; provided, however, that at the option of the Company
payment of interest may be made by check mailed to the address of the Person
entitled thereto as such address shall appear in the Debenture Register.
Notwithstanding the foregoing, so long as the Holder of this Debenture is
Capital, the payment of the principal of and interest (including Additional
Interest, if any) on this Debenture will be made at such place and to such
account as may be designated by Capital.
Reference is hereby made to the further provisions of this
Debenture set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Debenture shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument
to be duly executed under its corporate seal.
Dated:
AETNA LIFE AND
CASUALTY COMPANY
By___________________
Attest:
____________________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Debentures of the series designated
therein referred to in the within-mentioned Indenture.
THE FIRST NATIONAL
BANK OF CHICAGO
As Trustee
BY__________________
Authorized Officer
This Debenture is one of a duly authorized issue of
securities of the Company (herein called the "Debentures"), issued and to be
issued in one or more series under an Indenture, dated as of November 1, 1994
(herein called the "Indenture"), between the Company and The First National
Bank of Chicago, as Trustee (herein called the "Trustee", which term includes
any successor trustee under the Indenture), to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of
the respective rights, limitations of rights, duties and immunities thereunder
of the Company, the Trustee and the Holders of the Debentures and, to the
extent specifically set forth in the Indenture, the holders of Senior Debt and
Preferred Securities, and of the terms upon which the Debentures are, and are
to be, authenticated and delivered. This Debenture is one of the series
designated on the face hereof, limited in aggregate principal amount to
$316,455,696 (or up to
$363,924,051 aggregate principal amount if and to the extent the
over-allotment option granted to the underwriters of the Series A Preferred
Securities is exercised).
If Capital redeems the Series A Preferred Securities for
cash in accordance with the terms thereof, the Debentures of this series shall
become due and payable in a principal amount equal to the aggregate stated
liquidation preference of the Series A Preferred Securities so redeemed,
together with any and all accrued interest thereon, including Additional
Interest, if any, on the portion being redeemed.
Upon not less than 30 nor more than 60 days' prior notice,
the Company shall have the right to redeem the Debentures of this series
(together with any accrued but unpaid interest, including Additional Interest,
if any, on the portion being redeemed), without premium or penalty, in whole
or in part,
(1) at any time on or after November 30, 1999; and
(2) at any time, if (a) the Series A Preferred Securities
are outstanding and (b) there shall have occurred after November
15, 1994 a change in any applicable U.S. law or regulation or in
the interpretation thereof (including but not limited to the
enactment or imminent enactment of any legislation, the
publication of any judicial decisions, regulatory rulings,
regulatory procedures, or notices or announcements (including
notices or announcements of intent to adopt such procedures or
regulations), or a change in the official position or in the
interpretation of any law or regulation by any legislative body,
court, governmental authority or regulatory body, irrespective of
the manner in which such change is made known), and the Company
shall have been advised by legal counsel (which counsel is not an
employee of the Company or Capital) that, as a result of such
change, there exists more than an insubstantial risk that (i) the
Company will be precluded from deducting the interest paid on the
Debentures of this series for federal income tax purposes or (ii)
Capital will be subject to federal income tax with respect to the
interest received on the Debentures of this series.
If at any time after the issuance of the Series A Preferred
Securities, the Company is or, in the opinion of counsel (which counsel is not
an employee of the Company or Capital), would be required to pay Additional
Interest with respect to any Debentures of this series, the Company shall also
have the right to redeem without premium or penalty, in whole or in part
(together with accrued but unpaid interest, including Additional Interest, if
any, on the portion being redeemed) the Debentures of this series; provided
that in the event that the Company is required to pay Additional Interest as a
consequence of Capital's being required to pay Additional Amounts, then the
Company may only redeem Debentures of this series in a principal amount not to
exceed the aggregate stated liquidation preference of the Series A Preferred
Securities with respect to which such Additional Amounts are required to be
paid. In addition, if the Company or any of its subsidiaries purchases Series
A Preferred Securities by tender, in the open market or by private agreement,
the Company shall have the right to redeem Debentures of this series, without
premium or penalty, in an amount not to exceed the aggregate stated
liquidation preference of the Series A Preferred Securities so purchased,
together with any accrued and unpaid interest thereon, including Additional
Interest, if any, on the portion being redeemed.
In the event of any prepayment or redemption of this
Debenture in part only, a new Debenture or Debentures of this series and of
like tenor for the portion hereof which is not being prepaid or redeemed, as
the case may be, will be issued in the name of the Holder hereof upon the
cancellation hereof.
The Indenture contains provisions for defeasance at any time
of (1) the entire indebtedness of this Debenture or (2) certain restrictive
covenants and Events of Default with respect to this Debenture, in each case
upon compliance with certain conditions set forth in the Indenture.
If an Event of Default with respect to Debentures of this
series shall occur and be continuing, the principal of the Debentures of this
series and accrued interest (including Additional Interest, if any) thereon
may be declared due and payable in the manner and with the effect provided in
the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Debentures of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of not less than a majority in
aggregate principal amount of the Debentures at the time Outstanding of each
series to be affected (and, prior to a Security Exchange with respect to the
Debentures of any series affected thereby, the consent of the holders of not
less than a majority in stated liquidation preference of the Preferred
Securities of the related series). The Indenture also contains provisions
permitting the Holders of specified percentages in principal amount of the
Debentures of each series at the time Outstanding, on behalf of the Holders of
all Debentures of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences (except that prior to a Security Exchange with respect to
the Debentures of such series, any such waiver will also require the consent
of the holders of specified percentages of the stated liquidation preference
of the Preferred Securities of the related series). Any such consent or
waiver by the Holder of this Debenture shall be conclusive and binding upon
such Holder and upon all future Holders of this Debenture and of any Debenture
issued upon the registration of transfer hereof or in exchange hereof or in
lieu hereof, whether or not notation of such consent or waiver is made upon
this Debenture.
Subject to Section 1503 of the Indenture, no reference
herein to the Indenture (other than such Section) and no provisions of this
Debenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium and
interest on this Debenture at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Debenture is registerable
in the Debenture Register, upon surrender of this Debenture for registration of
transfer at the office or agency of the Company in any place where the
principal of and any premium and interest on this Debenture are payable, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Debenture Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Debentures of this series and of like tenor, of authorized
denominations and for the same aggregate principal amount, will be issued to
the designated transferee or transferees; provided that prior to a Security
Exchange with respect to the Debentures of this series, the Debentures of this
series may not be transferred without the written consent of the Company.
The Debentures of this series are issuable only in
registered form without coupons in denominations of $25.00 and any integral
multiple thereof. As provided in the Indenture and subject to certain
limitations therein set forth, Debentures of this series are exchangeable for
a like aggregate principal amount of Debentures of this series and of like
tenor of a different authorized denomination, as requested by the Holder
surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Debenture for registration
of transfer, the Company, the Trustee and any agent of the Company or the
Trustee may treat the Person in whose name this Debenture is registered as the
owner hereof for all purposes, whether or not this Debenture is overdue, and
neither the Company, the Trustee nor any such agent shall be affected by
notice to the contrary.
No recourse shall be had for the payment of the principal of
or interest (including Additional Interest, if any) on this Debenture, or for
any claim based hereon, or otherwise in respect hereof, or based on or in
respect of the Indenture or any indenture supplemental thereto, against any
incorporator, stockholder, officer or director, as such, past, present or
future, of the Company or of any successor corporation, 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 issue hereof, expressly waived
and released.
All terms used in this Debenture which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
EXHIBIT 6
PAYMENT AND GUARANTEE AGREEMENT
THIS PAYMENT AND GUARANTEE AGREEMENT (the "Guarantee"), dated
as of November 22, 1994, is executed and delivered by Aetna Life and Casualty
Company, a Connecticut insurance corporation ("Aetna"), for the benefit of the
Holders (as defined below) from time to time of the Preferred Securities (as
defined below) of Aetna Capital L.L.C., a Delaware limited liability company
(the "Issuer").
WHEREAS, the Issuer intends to issue its common limited
liability company interests (the "Common Securities") to and receive related
capital contributions (the "Common Securities Payments") from Aetna and Aetna
Capital Holdings, Inc., a Connecticut corporation ("Aetna Capital"), and to
issue and sell from time to time, in one or more series, preferred limited
liability company interests (the "Preferred Securities") with such powers,
preferences and special rights and limitations and restrictions as are set
forth in a written action or actions (the "Actions") of the Managing Members
(as defined below) providing for the issue of such series;
WHEREAS, the Issuer will purchase the Debentures (as defined
below) issued pursuant to the Subordinated Indenture (as defined below) with
the proceeds from the issuance and sale of the Preferred Securities and the
Common Securities Payments; and
WHEREAS, Aetna desires hereby to irrevocably and
unconditionally agree to the extent set forth herein to pay to the Holders the
Guarantee Payments (as defined below) on the terms and conditions set forth
herein.
NOW, THEREFORE, in consideration of the purchase by each Holder
of the Preferred Securities, which purchase Aetna hereby agrees shall benefit
Aetna and which purchase Aetna acknowledges will be made in reliance upon the
execution and delivery of this Guarantee, Aetna executes and delivers this
Guarantee for the benefit of the Holders.
ARTICLE I
As used in this Guarantee, the terms set forth below shall have
the following meanings:
"Additional Amounts" shall mean, with respect to the Preferred
Securities of any series, any additional amounts that the Issuer is required
to pay as dividends to Holders of the Preferred Securities of such series
pursuant to the Actions establishing the Preferred Securities of such series
in the event that the Issuer is required by law to withhold or deduct for or
on account of any present or future taxes, duties, assessments or governmental
charges of whatever nature imposed or levied upon or as a result of any
payments by the Issuer in respect of the Preferred Securities of such series
by or on behalf of the United States of America, any state thereof or any other
jurisdiction through which or from which such payment is made, or any
authority therein or thereof having power to tax.
"Debentures" shall mean the debentures issued by Aetna to the
Issuer pursuant to the Subordinated Indenture that will evidence the loans to
be made by the Issuer to Aetna from time to time of the proceeds received by
the Issuer from the issuance and sale of the Preferred Securities and the
Common Securities Payments.
"Event of Default" shall have the meaning set forth in the
Subordinated Indenture.
"Guarantee Additional Amounts" shall have the meaning specified
in Article IV.
"Guarantee Payments" shall mean, with respect to any series of
Preferred Securities, the following payments, without duplication, to the
extent not paid by the Issuer: (i) any accumulated and unpaid dividends
(including Additional Amounts payable by the Issuer) that have been
theretofore declared on the Preferred Securities of such series, payable out
of funds legally available therefor, (ii) the Redemption Price payable out of
funds legally available therefor with respect to any Preferred Securities of
such series called for redemption by the Issuer and (iii) upon the liquidation
of the Issuer other than in connection with the exchange of each series of
Preferred Securities outstanding for the related series of Debentures, the
lesser of (a) the Liquidation Distribution (as defined below) with respect to
Preferred Securities of such series and (b) the amount of assets of the Issuer
legally available for distribution to Holders of Preferred Securities of such
series in liquidation.
"Holder" shall mean any member of the Issuer from time to time
holding any Preferred Securities of any series; 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 Aetna or any entity owned 50% or more by Aetna,
either directly or indirectly.
"Liquidation Distribution" shall mean, with respect to any
series of Preferred Securities, the aggregate of the stated liquidation
preference of such series of Preferred Securities and all accumulated and
unpaid dividends (whether or not declared) with respect to such series to the
date of payment.
"L.L.C. Agreement" shall mean the Issuer's Amended and Restated
Limited Liability Company Agreement dated as of November 15, 1994, as amended
from time to time.
"Managing Members" shall mean Aetna and Aetna Capital, in their
capacity as the members of the Issuer that own all of the Issuer's outstanding
Common Securities.
"Redemption Price" shall mean, with respect to any series of
Preferred Securities, the aggregate stated liquidation preference of all
Preferred Securities of such series plus accumulated and unpaid dividends
(whether or not declared) with respect to such series to the date fixed for
redemption.
"Subordinated Indenture" shall mean the subordinated indenture
dated as of November 1, 1994 between Aetna and The First National Bank of
Chicago, as trustee, as amended or supplemented from time to time.
ARTICLE II
Section 2.01. Aetna irrevocably and unconditionally agrees, to
the extent set forth herein, to pay in full to the Holders of each series of
Preferred Securities the Guarantee Payments with respect to such series of
Preferred Securities, as and when due (except to the extent paid by the Issuer
or paid by Aetna to any trustee appointed by such Holders pursuant to Article
VIII of the L.L.C. Agreement), regardless of any defense, right of set-off or
counterclaim which the Issuer may have or assert. This Guarantee is
continuing, irrevocable, unconditional and absolute.
Section 2.02. Aetna hereby waives notice of acceptance of
this Guarantee and of any liability to which it applies or may apply,
presentment, demand for payment, protest, notice of nonpayment, notice of
dishonor, notice of redemption and all other notices and demands.
Section 2.03. The obligations, covenants, agreements and
duties of Aetna under this 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 of any series 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 dividends, Redemption Price, Liquidation
Distributions or any other sums payable under the terms of the
Preferred Securities of any series or the extension of time for the
performance of any other obligation under, arising out of, or in
connection with, the Preferred Securities of such series;
(c) any failure, omission, delay or lack of diligence on the
part of the Holders of Preferred Securities of any series to enforce,
assert or exercise any right, privilege, power or remedy conferred on
such Holders pursuant to the terms of the Preferred Securities of
such series, 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, any of the
Preferred Securities; or
(f) the settlement or compromise of any obligation guaranteed
hereby or hereby incurred.
There shall be no obligation of the Holders to give notice to, or obtain
consent of, Aetna with respect to the happening of any of the foregoing.
Section 2.04. This is a guarantee of payment and not of
collection. A Holder may enforce this Guarantee directly against Aetna, and
Aetna waives any right or remedy to require that any action be brought against
the Issuer or any other person or entity before proceeding against Aetna.
Subject to Section 2.05 hereof, all waivers herein contained shall be without
prejudice to the Holders' right at the Holders' option to proceed against the
Issuer, whether by separate action or by joinder.
Section 2.05. Aetna shall be subrogated to all (if any)
rights of the Holders against the Issuer in respect of any amounts paid to the
Holders by Aetna under this Guarantee and shall have the right to waive
payment of any amount of dividends in respect of which payment has been made
to the Holders by Aetna pursuant to Section 2.01 hereof; provided, however,
that Aetna shall not (except to the extent required by mandatory provisions of
law) exercise any rights which it may acquire by way of subrogation or any
indemnity, reimbursement or other agreement, in all cases as a result of a
payment under this Guarantee, if, at the time of any such payment, any amounts
are due and unpaid under this Guarantee. If any amount shall be paid to Aetna
in violation of the preceding sentence, Aetna agrees to pay over such amount
to the Holders.
Section 2.06. Aetna acknowledges that its obligations
hereunder are independent of the obligations of the Issuer with respect to the
Preferred Securities and that Aetna shall be liable as principal and sole
debtor hereunder to make Guarantee Payments pursuant to the terms of this
Guarantee notwithstanding the occurrence of any event referred to in
subsections (a) through (f), inclusive, of Section 2.03 hereof.
ARTICLE III
Section 3.01. So long as any Preferred Securities of any
series remain outstanding, Aetna shall not declare or pay any dividend on, or
redeem, purchase, acquire or make a liquidation payment with respect to, any
of its capital stock or make any guarantee payments with respect to the
foregoing (other than (i) payments under this Guarantee, (ii) acquisitions of
shares of Aetna's common stock in connection with the satisfaction by Aetna of
its obligations under any employee benefit plans and (iii) redemptions of any
share purchase rights issued by Aetna pursuant to Aetna's Share Purchase
Rights Plan adopted on October 27, 1989, as amended from time to time or the
declaration of a dividend of similar share purchase rights in the future), if
at such time Aetna shall be in default with respect to its payment obligations
hereunder or if there shall have occurred and be continuing an Event of
Default with respect to any Debentures related to the Preferred Securities then
outstanding.
Section 3.02. So long as any Preferred Securities of any
series remain outstanding, Aetna shall: (i) not cause or permit any Common
Securities to be transferred; (ii) maintain direct or indirect 100% ownership
of all outstanding securities of the Issuer other than (x) the Preferred
Securities of any series and (y) any other securities issued by the Issuer
(other than the Common Securities) so long as the issuance thereof to persons
other than Aetna or any of its subsidiaries would not cause the Issuer to
become an "investment company" required to be registered under the Investment
Company Act of 1940, as amended; (iii) cause at least 21% of the total value
of the Issuer and at least 21% of all interests in the capital, income, gain,
loss, deduction and credit of the Issuer to be represented by Common
Securities; (iv) not voluntarily dissolve, wind up or liquidate the Issuer
(other than in connection with the exchange of all series of Preferred
Securities outstanding for the related series of Debentures) or either of the
Managing Members; (v) cause Aetna and Aetna Capital to remain the Managing
Members of the Issuer and timely perform all of their respective duties as
Managing Members (including the duty to declare and pay dividends on the
Preferred Securities); and (vi) use reasonable efforts to cause the Issuer to
remain a limited liability company and otherwise continue to be treated as a
partnership for United States federal income tax purposes; provided that,
notwithstanding the foregoing, Aetna may permit the Issuer to consolidate or
merge with or into or convey, transfer or lease its properties and assets
substantially as an entirety to another entity upon the terms and subject to
the conditions set forth in the L.L.C. Agreement.
Section 3.03. The Guarantee will constitute an unsecured
obligation of Aetna and will rank (i) subordinate and junior in right of
payment to all other liabilities of Aetna, (ii) pari passu with the most
senior preferred stock now or hereafter issued by Aetna and with any guarantee
now or hereafter entered into by Aetna in respect of any preferred or
preference stock or interest of any affiliate of Aetna and (iii) senior to
Aetna's common stock.
Section 3.04. So long as any Preferred Securities of any
series remain outstanding, Aetna shall not permit Aetna Capital to incur any
indebtedness for borrowed money other than any such indebtedness to Aetna or
any subsidiary of Aetna.
ARTICLE IV
All Guarantee Payments shall be made without withholding or
deduction for or on account of any present or future taxes, duties,
assessments or governmental charges of whatever nature imposed or levied upon
or as a result of such payment by or on behalf of the United States of
America, any state thereof or any other jurisdiction through which or from
which such payment is made, or any authority therein or thereof having power
to tax, unless the withholding or deduction of such taxes, duties, assessments
or governmental charges is required by law. In that event, Aetna will pay
such additional amounts as may be necessary in order that the net amounts
received by the Holders of the Preferred Securities of such series after such
withholding or deduction will equal the amount which would have been
receivable in respect of such Preferred Securities in the absence of such
withholding or deduction ("Guarantee Additional Amounts"), except that no such
Guarantee Additional Amounts will be payable with respect to Preferred
Securities:
(i) if the Holder or beneficial owner thereof is liable for
such taxes, duties assessments or governmental charges in respect of
such Preferred Securities by reason of such Holder's or owner's having
some connection with the United States, any state thereof or any
other jurisdiction through which or from which such payment is made
(including,without limitation, actual or constructive ownership, past
or present, of 10% or more of the total combined voting power of all
classes of stock entitled to vote of Aetna), other than being a
holder or beneficial owner of such Preferred Securities, or
(ii) if the Issuer or Aetna has notified such Holder of the
obligation to withhold taxes and requested but not received from such
Holder or beneficial owner a declaration of non-residence, a valid
taxpayer identification number or other claim for exemption (or
information or certification required to support such claim), and
such withholding or deduction would not have been required had such
declaration, taxpayer identification number or claim been received.
ARTICLE V
This Guarantee shall terminate and be of no further force and
effect as to any series of Preferred Securities upon full payment of the
Redemption Price of all Preferred Securities of such series or upon the
exchange of all Preferred Securities of such series for the related series of
Debentures and shall terminate completely upon full payment of the amounts
payable to Holders upon liquidation of the Issuer; provided, however, that this
Guarantee shall continue to be effective or shall be reinstated, as the case
may be, if at any time any Holder must restore payment of any sums paid under
the Preferred Securities of such series or under this Guarantee for any reason
whatsoever.
ARTICLE VI
Section 6.01. All guarantees and agreements contained in
this Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of Aetna and shall inure to the benefit of the Holders.
Except in connection with a consolidation, merger or sale involving Aetna that
is permitted under the Subordinated Indenture, Aetna shall not assign its
obligations hereunder without the prior approval of Holders of not less than a
majority in stated liquidation preference of all Preferred Securities of all
series then outstanding voting as a single class.
Section 6.02. Except with respect to any changes which do
not adversely affect the rights of Holders (in which case no vote will be
required), this Guarantee may only be amended by an instrument in writing
signed by Aetna with the prior approval of the Holders of not less than a
majority in stated liquidation preference of all Preferred Securities of all
series then outstanding voting as a single class. Such approval shall be
obtained in the manner set forth in Article VIII of the L.L.C. Agreement.
Section 6.03. Any notice, request or other communication
required or permitted to be given hereunder to Aetna shall be given in writing
by delivering the same against receipt therefor by facsimile transmission
(confirmed by mail), telex or by registered or certified mail, addressed to
Aetna, as follows (and if so given, shall be deemed given when mailed or upon
receipt of an answer-back, if sent by telex), to wit:
Aetna Life and Casualty Company
151 Farmington Avenue
Hartford, Connecticut 06156
Facsimile No.: (203) 275-2661
Attention: Treasurer
(with a copy to the attention of the General/Counsel
(203) 273-8340)
Any notice, request or other communication required or
permitted to be given hereunder to the Holders shall be given by Aetna in the
same manner as notices sent by the Issuer to the Holders.
Section 6.04. The masculine and neuter genders used herein
shall include the masculine, feminine and neuter genders.
Section 6.05. This Guarantee is solely for the benefit of
the Holders and is not separately transferable from the Preferred Securities.
Section 6.06. THIS GUARANTEE SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
THIS GUARANTEE is executed as of the day and year first above
written.
Aetna Life and Casualty
Company
By ___________________________
Name:
Title:
EXHIBIT 7
AGREEMENT AS TO EXPENSES AND LIABILITIES
AGREEMENT dated as of November 22, 1994, between Aetna Life and
Casualty Company, a Connecticut insurance corporation ("Aetna"), and Aetna
Capital L.L.C., a Delaware limited liability company ("Capital").
WHEREAS, Capital intends to issue its common limited liability
company interests (the "Common Securities") to and receive related capital
contributions from Aetna and Aetna Capital Holdings, Inc. and to issue and
sell from time to time, in one or more series, preferred limited liability
company interests (the "Preferred Securities") with such powers, preferences
and special rights and restrictions as are set forth in a written action or
actions of the managing members of Capital providing for the issue of such
series;
WHEREAS, Aetna will directly or indirectly own all of the
Common Securities of Capital;
NOW, THEREFORE, in consideration of the purchase by each holder
of the Preferred Securities, which purchase Aetna hereby agrees shall benefit
Aetna and which purchase Aetna acknowledges will be made in reliance upon the
execution and delivery of this Agreement, Aetna and Capital hereby agree as
follows:
Section 1.01. Guarantee by Aetna. Subject to the terms and
conditions hereof, Aetna hereby irrevocably and unconditionally guarantees to
each person or entity to whom Capital is now or hereafter becomes indebted or
liable (the "Beneficiaries") (other than obligations to holders of any
Preferred Securities or any other limited liability company interests in
Capital, in such holders' capacities as holders of such Preferred Securities
or other limited liability company interests) the full payment, when and as
due, of any and all indebtedness and liabilities of Capital to such
Beneficiaries (collectively, the "Obligations"). This Agreement is intended
to be for the benefit of, and to be enforceable by, all such Beneficiaries,
whether or not such Beneficiaries have received notice hereof.
Section 1.02. Term of Agreement. This Agreement shall
terminate and be of no further force and effect upon the later of (i) the date
on which full payment has been made of all amounts payable to all holders of
all series of the Preferred Securities (whether upon redemption, liquidation,
exchange or otherwise) and (ii) the date on which there are no Beneficiaries
remaining; provided, however, that this Agreement shall continue to be
effective or shall be reinstated, as the case may be, if at any time any
holder of Preferred Securities of any series or any Beneficiary must restore
payment of any sums paid under the Preferred Securities of such series, under
any Obligation, under the Payment and Guarantee Agreement dated the date
hereof and executed and delivered by Aetna or under this Agreement for any
reason whatsoever. This Agreement is continuing, irrevocable, unconditional
and absolute.
Section 1.03. Waiver of Notice. Aetna hereby waives notice of
acceptance of this Agreement and of any Obligation to which it applies or may
apply, and Aetna hereby waives presentment, demand for payment, protest,
notice of nonpayment, notice of dishonor, notice of redemption and all other
notices and demands.
Section 1.04. No Impairment. The obligations, covenants,
agreements and duties of Aetna under this Agreement shall in no way be
affected or impaired by reason of the happening from time to time of any of
the following:
(a) the extension of time for the payment by Capital of all
or any portion of the Obligations or for the performance of any other
obligation under, arising out of, or in connection with, the Obligations;
(b) any failure, omission, delay or lack of diligence on the
part of the Beneficiaries to enforce, assert or exercise any right, privilege,
power or remedy conferred on the Beneficiaries with respect to the Obligations
or any action on the part of Capital granting indulgence or extension of any
kind; or
(c) 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, Capital or
any of the assets of Capital.
There shall be no obligation of the Beneficiaries to give notice to, or obtain
the consent of, Aetna with respect to the happening of any of the foregoing.
Section 1.05. Enforcement. A Beneficiary may enforce this
Agreement directly against Aetna and Aetna waives any right or remedy to
require that any action be brought against Capital or any other person or
entity before proceeding against Aetna.
ARTICLE II
Section 2.01. Binding Effect. All guarantees and agreements
contained in this Agreement shall bind the successors, assigns, receivers,
trustees and representatives of Aetna and shall inure to the benefit of the
Beneficiaries.
Section 2.02. Amendment. So long as there remains any
Beneficiary or any Preferred Securities of any series are outstanding, this
Agreement shall not be modified or amended in any manner adverse to such
Beneficiary or to the holders of the Preferred Securities.
Section 2.03. Notices. Any notice, request or other
communication required or permitted to be given hereunder shall be given in
writing by delivering the same against receipt therefor by facsimile
transmission (confirmed by mail), telex or by registered or certified mail,
addressed as follows (and if so given, shall be deemed given when mailed or
upon receipt of an answer-back, if sent by telex), to wit:
Aetna Capital L.L.C.
c/o Aetna Life and Casualty Company
151 Farmington Avenue
Hartford, Connecticut 06156
Facsimile No.: (203) 275-2661
Attention: Treasurer
Aetna Life and Casualty Company
151 Farmington Avenue
Hartford, Connecticut 06156
Facsimile No.: (203) 275-2661
Attention: Treasurer
(with a copy to the attention
of the General Counsel
(203) 273-8340)
Section 2.04 THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
THIS AGREEMENT is executed as of the day and year first above
written.
AETNA LIFE AND CASUALTY COMPANY
By ___________________________
Name:
Title:
AETNA CAPITAL L.L.C.
By Aetna Life and Casualty Company,
as Managing Member
By ____________________________
Name:
Title:
