<PAGE>
REGISTRATION NO. 33-51963
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 4 TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
TORCHMARK CORPORATION TORCHMARK CAPITAL L.L.C.
(EXACT NAME OF REGISTRANT AS (EXACT NAME OF REGISTRANT AS
SPECIFIED IN ITS CHARTER) SPECIFIED IN ITS CHARTER)
DELAWARE 63-0780404 DELAWARE [63-1120036]
(STATE OR OTHER (I.R.S. EMPLOYER (STATE OR OTHER (I.R.S. EMPLOYER
JURISDICTION OF IDENTIFICATION JURISDICTION OF IDENTIFICATION
INCORPORATION OR NUMBER) INCORPORATION OR NUMBER)
ORGANIZATION) ORGANIZATION)
2001 THIRD AVENUE SOUTH
BIRMINGHAM, ALABAMA 35233
(205) 325-4200
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANTS' PRINCIPAL EXECUTIVE OFFICES)
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KEITH A. TUCKER
VICE CHAIRMAN
TORCHMARK CORPORATION
2001 THIRD AVENUE SOUTH
BIRMINGHAM, ALABAMA 35233
(205) 325-4248
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
---------------
COPIES TO:
ALAN J. BOGDANOW, ESQ. FRANCIS MORISON, ESQ.
HUGHES & LUCE, L.L.P. DAVIS POLK & WARDWELL
1717 MAIN ST., SUITE 2800 450 LEXINGTON AVENUE
DALLAS, TEXAS 75201 NEW YORK, NEW YORK 10017
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement, as determined
by market conditions.
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If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, please check the following box. [X]
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CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
PROPOSED
PROPOSED MAXIMUM
AMOUNT MAXIMUM AGGREGATE AMOUNT OF
TITLE OF SECURITIES BEING OFFERING PRICE OFFERING REGISTRATION
BEING REGISTERED REGISTERED(3) PER UNIT(4) PRICE(5) FEE(6)
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<S> <C> <C> <C> <C>
Torchmark Preferred
Stock ................
Torchmark Depositary
Shares(1).............
Torchmark Capital
Preferred Securities.. $200,000,000 $200,000,000 $68,965.52
Torchmark Backup
Undertakings with
respect to Torchmark
Capital Preferred
Securities(2).........
</TABLE>
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(1) The consideration for the Depositary Shares is included in that of the
Torchmark Preferred Stock, par value $1.00 per share.
(2) No separate consideration will be received for the Torchmark Corporation
Backup Undertakings with respect to the Torchmark Capital Preferred
Securities.
(3) Within the overall amount of securities being registered hereby, the
maximum number of shares of Torchmark Preferred Stock, Depositary Shares or
Torchmark Capital Preferred Securities being registered hereby is such number
as has a proposed maximum aggregate offering price of $200,000,000, in U.S.
dollars, or the equivalent thereof in foreign currencies, plus accrued
dividends, if any.
(4) The proposed maximum offering price per share or Depositary Share is
equal to the proposed maximum aggregate offering price for the shares or
Depositary Shares offered, divided by the number of shares or Depositary
Shares offered.
(5) Estimated solely for the purposes of calculating the registration fee.
(6) Previously paid.
---------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE AS SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
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<PAGE>
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED JUNE , 1994
TORCHMARK CAPITAL L.L.C.
% PREFERRED SECURITIES, SERIES A
(LIQUIDATION PREFERENCE $ PER SECURITY)
GUARANTEED TO THE EXTENT SET FORTH HEREIN BY
TORCHMARK CORPORATION
---------------
The % Preferred Securities, Series A (the "Series A Preferred
Securities"), representing the preferred limited liability company interests
offered hereby are being issued by Torchmark Capital L.L.C., a limited
liability company organized under the laws of the State of Delaware
("Torchmark Capital"). All of the common limited liability company interests
of Torchmark Capital are beneficially owned by Torchmark Corporation, a
Delaware corporation ("Torchmark"). Torchmark Capital was formed solely for
the purpose of issuing securities and making loans (the "Loans") of the net
proceeds thereof to Torchmark or its subsidiaries.
The Series A Preferred Securities will entitle holders to receive cumulative
preferential distributions ("dividends") at an annual rate of % of the
liquidation preference of $ per security, accruing from the date of
original issuance and payable monthly in arrears on the last day of each
calendar month of each year, commencing , 1994. The payment of
dividends, if and to the extent declared out of moneys held by Torchmark
Capital and legally available therefor, and payments on liquidation or
redemption with respect to the Series A Preferred Securities are guaranteed by
Torchmark to the extent described herein (the "Guarantee"). If Torchmark fails
to make interest payments on the Loans, Torchmark Capital will have
insufficient funds to declare or pay dividends on the Series A Preferred
Securities. The Guarantee does not cover payment of such undeclared dividends.
In such event, the remedy of a holder of Series A Preferred Securities is to
enforce the Loans. See "Description of the Loans--Enforcement." For a
discussion of the terms and limitations of the Guarantee, see "Description of
the Guarantee." The Guarantee will rank junior to all liabilities of
Torchmark. At March 31, 1994, Torchmark had Senior Indebtedness of
approximately $899.4 million and total liabilities of approximately $6.2
billion. Neither the Guarantee nor the Loan Agreement limit the amount of
Senior Indebtedness that may be incurred in the future. No portion of the
dividends received by any holders of the Series A Preferred Securities will be
eligible for the dividends received deductions for U.S. federal income tax
purposes.
The Series A Preferred Securities are redeemable, at the option of Torchmark
Capital (with Torchmark's consent), in whole or in part from time to time, at
$ per security on or after , 1999, plus in each case accrued and
unpaid dividends to the date fixed for redemption (the "Redemption Price"),
and will be redeemed, under certain circumstances, from the proceeds of any
prepayment or repayment by Torchmark of the loan of the proceeds from the sale
of the Series A Preferred Securities. In addition, at the option of Torchmark
Capital (with Torchmark's consent), under certain circumstances following the
occurrence of a Special Event (as defined herein) arising from a change in
law, the Series A Preferred Securities are redeemable in whole, but not in
part, from time to time, at the Redemption Price. See "Description of Series A
Preferred Securities--Special Event Redemption."
In the event of the liquidation of Torchmark Capital, holders of Series A
Preferred Securities will be entitled to receive for each Series A Preferred
Security the liquidation preference of $ plus accrued and unpaid dividends
to the date of payment, subject to certain limitations. See "Description of
Series A Preferred Securities--Liquidation Dividend."
For a description of the various contractual backup undertakings of
Torchmark relating to the Series A Preferred Securities, see "Torchmark
Capital L.L.C.," "Description of Series A Preferred Securities--Mandatory
Redemption," "Description of the Guarantee" and "Description of the Loans"
herein.
SEE "CERTAIN INVESTMENT CONSIDERATIONS" FOR CERTAIN CONSIDERATIONS RELEVANT
TO AN INVESTMENT IN THE SERIES A PREFERRED SECURITIES, INCLUDING CIRCUMSTANCES
UNDER WHICH PAYMENT OF DIVIDENDS ON THE SERIES A PREFERRED SECURITIES MAY BE
DEFERRED.
Application has been made to list the Series A Preferred Securities on the
New York Stock Exchange.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS TO WHICH
IT RELATES. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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<TABLE>
<CAPTION>
INITIAL PUBLIC UNDERWRITING PROCEEDS TO
OFFERING PRICE(1) COMMISSIONS(2) COMPANY(3)(4)
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<S> <C> <C> <C>
Per Security.................... $ (3) $
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Total (4)....................... $ (3) $
</TABLE>
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(1) Plus accrued dividends, if any, from , 1994.
(2) Torchmark Capital and Torchmark have agreed to indemnify the several
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933, as amended. See "Underwriters."
(3) In view of the fact that the proceeds of the sale of the Series A
Preferred Securities will be lent to Torchmark, Torchmark has agreed to
pay the Underwriters, as compensation ("Underwriters' Compensation") for
their services, $ per Series A Preferred Security (or $ in the
aggregate). See "Underwriters."
(4) In addition, expenses related to the offering, estimated at $375,000, will
be paid by Torchmark.
---------------
The Series A Preferred Securities are offered severally by the Underwriters,
as specified herein, subject to receipt and acceptance by them and subject to
their right to reject any order in whole or in part. It is expected that
delivery of the Series A Preferred Securities will be made only in book-entry
form through the facilities of The Depository Trust Company on or about ,
1994.
---------------
[UNDERWRITERS]
THE DATE OF THIS PROSPECTUS SUPPLEMENT IS , 1994.
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES
OFFERED HEREBY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE, THE
OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
FOR NORTH CAROLINA PURCHASERS: THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE COMMISSIONER OF INSURANCE FOR THE STATE OF NORTH CAROLINA,
NOR HAS THE COMMISSIONER OF INSURANCE RULED ON THE ACCURACY OR ADEQUACY OF THIS
DOCUMENT.
NO PERSON IS AUTHORIZED BY TORCHMARK OR TORCHMARK CAPITAL OR BY THE
UNDERWRITERS OR ANY DEALER TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED OR INCORPORATED BY REFERENCE IN THIS
PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS AND, IF GIVEN OR MADE,
SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN SO
AUTHORIZED. NEITHER THIS PROSPECTUS SUPPLEMENT NOR THE ACCOMPANYING PROSPECTUS
CONSTITUTES AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY
SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS PROSPECTUS SUPPLEMENT OR
AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SUCH SECURITIES IN ANY
JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH
JURISDICTION. THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING
PROSPECTUS OR ANY SALE MADE HEREUNDER DOES NOT IMPLY THAT THE INFORMATION
CONTAINED HEREIN OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE ON
WHICH SUCH INFORMATION IS GIVEN.
----------------
S-2
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
PROSPECTUS SUPPLEMENT
<S> <C>
Prospectus Supplement Summary............................................
Certain Investment Considerations........................................
Torchmark Capital L.L.C..................................................
Torchmark Corporation....................................................
Use of Proceeds..........................................................
Description of Series A Preferred Securities.............................
Description of the Guarantee.............................................
Description of the Loans.................................................
Certain United States Income Tax Consequences............................
Underwriters.............................................................
Legal Opinions...........................................................
PROSPECTUS
Available Information....................................................
Incorporation of Certain Information by Reference........................
Torchmark................................................................
Ratio of Earnings to Combined Fixed Charges and Preferred Stock
Dividends...............................................................
Use of Proceeds..........................................................
Selected Consolidated Financial Information..............................
Description of Torchmark Stock...........................................
Description of Depositary Shares.........................................
Torchmark Capital L.L.C..................................................
Plan of Distribution.....................................................
Legal Opinions...........................................................
Experts..................................................................
</TABLE>
S-3
<PAGE>
PROSPECTUS SUPPLEMENT SUMMARY
The following summary is qualified in its entirety by the more detailed
information and consolidated financial statements included elsewhere in this
Prospectus Supplement and in the Prospectus or incorporated herein or therein
by reference.
TORCHMARK AND TORCHMARK CAPITAL
Torchmark Capital L.L.C. ("Torchmark Capital"), a wholly owned special
purpose finance subsidiary of Torchmark Corporation ("Torchmark"), is a
Delaware limited liability company formed solely for the purpose of issuing
common and preferred limited liability company interests, including the Series
A Preferred Securities, and lending the proceeds thereof to Torchmark.
Torchmark, through its subsidiaries, offers a portfolio of life and health
insurance products, institutional investment management services and individual
financial planning services and products, and engages in energy related
services and operations.
THE OFFERING
Securities Offered.............. million % Preferred Securities, Series
A.
Issuer.......................... Torchmark Capital L.L.C., a special purpose
finance subsidiary organized as a Delaware
limited liability company and wholly owned,
directly or indirectly, by Torchmark Corpora-
tion.
Guarantor....................... Torchmark Corporation.
Liquidation Preference.......... $ per security, plus accumulated and un-
paid dividends.
Dividends....................... Cumulative at the annual rate of % of the
stated liquidation preference per security,
payable monthly in arrears on the last day of
each calendar month, commencing ,
1994.
Redemption...................... Not redeemable prior to , 1999 (except in
limited circumstances described herein under
"Description of Series A Preferred Securi-
ties--Special Event Redemption"). Thereafter,
redeemable at the option of Torchmark Capital
at any time, or mandatorily (unless the funds
are relent to Torchmark) in the event of a
prepayment by Torchmark of the Loans under
the Loan Agreement (each as defined below),
at $ per security plus accumulated and un-
paid dividends.
Listing......................... New York Stock Exchange (Symbol ["TMKPfA"]).
Use of Proceeds................. All proceeds will be lent (the "Loans") by
Torchmark Capital to Torchmark under a Loan
Agreement (the "Loan Agreement") for general
corporate purposes, which may include, with-
out limitation, repayment of bank debt, the
repurchase of shares of Torchmark's common
stock, and possible acquisitions.
S-4
<PAGE>
BACKUP UNDERTAKINGS OF TORCHMARK:
Payment and Guarantee
Agreement Obligations...... Torchmark irrevocably and unconditionally
guarantees Torchmark Capital's payment of:
(i) all legally declared and unpaid divi-
dends, (ii) all redemption payments to the
extent of funds legally available therefor
and (iii) in the event of liquidation, the
lesser of (a) the liquidation preference plus
accumulated and unpaid dividends or (b) the
amount of assets of Torchmark Capital legally
available for distribution to holders of Pre-
ferred Securities in such liquidation. The
Guarantee is directly enforceable by holders
of Series A Preferred Securities and is sub-
ordinate to all liabilities of Torchmark.
Loan Agreement Obligations.. Under the Loan Agreement, Torchmark is obli-
gated to pay (i) interest at % per annum,
which will be in an amount and at times suf-
ficient to permit timely and full payment of
all dividends on Series A Preferred Securi-
ties (subject to certain rights of extension
described under "Description of the Loans--
Extended Interest Payment Period"), and (ii)
principal in amounts and at times sufficient
to permit timely and full payment of all
amounts payable by Torchmark Capital to hold-
ers of Series A Preferred Securities on ac-
count of mandatory or optional redemptions of
Series A Preferred Securities or dissolution,
wind-up or liquidation of Torchmark Capital.
The obligations of Torchmark under the Loan
Agreement are directly enforceable by or on
behalf of holders of Series A Preferred Secu-
rities, and are subordinate to the extent de-
scribed herein.
Related Guarantee and Loan
Agreement Covenants........ Under the Payment and Guarantee Agreement and
the Loan Agreement, Torchmark covenants,
among other things, so long as any Series A
Preferred Securities remain outstanding, (i)
to maintain direct or indirect 100% ownership
of the Securities of Torchmark Capital other
than the Series A Preferred Securities and
any additional preferred securities ranking
pari passu with the Series A Preferred Secu-
rities; (ii) not to voluntarily dissolve,
wind-up or liquidate Torchmark Capital; and
(iii) to remain the Managing Member of
Torchmark Capital and to timely perform all
of its duties as Managing Member of Torchmark
Capital (including the duty to declare and
pay dividends on the Preferred Securities),
provided that any permitted successor of
Torchmark under the Loan Agreement may suc-
ceed to its duties as Managing Member.
S-5
<PAGE>
Certain Investment
Considerations................. Prospective purchasers of Series A Preferred
Securities should carefully review the infor-
mation contained elsewhere in this Prospectus
Supplement and the accompanying Prospectus
and should particularly consider the matters
set forth under "Certain Investment Consider-
ations."
S-6
<PAGE>
CERTAIN INVESTMENT CONSIDERATIONS
Prospective purchasers of Series A Preferred Securities should carefully
review the information contained elsewhere in this Prospectus Supplement and in
the Prospectus and should particularly consider the following matters.
SUBORDINATION OF TORCHMARK OBLIGATIONS
Torchmark's obligations under the Guarantee (as defined herein) are
subordinate and junior in right of payment to all other liabilities of
Torchmark and the obligations of Torchmark under the Loan Agreement (as defined
herein) are subordinate and junior in right of payment to Senior Indebtedness
of Torchmark. See "Description of the Guarantee--Status of the Guarantee" and
"Description of the Loans--Subordination." At March 31, 1994, Torchmark had
approximately $899.4 million of outstanding Senior Indebtedness, as well as
approximately $6.2 billion of other liabilities reflected on its balance sheet,
all of which would rank senior to the Guarantee. There are no provisions in the
Series A Preferred Securities, the Loan Agreement or the Guarantee which limit
Torchmark's ability to incur additional indebtedness, including indebtedness
that ranks senior to the Guarantee and the Loan Agreement.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
Torchmark has the right under the Loan Agreement to extend interest payment
periods for up to 60 months, and, as a consequence, monthly dividends on the
Series A Preferred Securities can be deferred (but will continue to accumulate)
by Torchmark Capital during any such extended interest payment period. In the
event that Torchmark exercises this right, Torchmark may not declare dividends
on any share of its capital stock (other than a declaration of a dividend
consisting of common or preferred stock purchase rights under a stockholder
rights plan). Torchmark Capital and Torchmark currently believe that the
extension of a payment period is remote. See "Description of the Loans--Option
to Extend Interest Payment Period." See "Description of Series A Preferred
Securities--Voting" and "Certain United States Income Tax Consequences" for a
description of certain voting rights and U.S. income tax consequences of an
extended interest payment period.
TAX CONSEQUENCES OF EXTENDED INTEREST PAYMENT PERIOD
Should an extended interest payment period occur, Torchmark Capital will
continue to accrue income for U.S. federal income tax purposes which will be
allocated, even though not distributed currently, to record holders of Series A
Preferred Securities. As a result, such a holder will include such interest in
gross income for U.S. federal income tax purposes in advance of the receipt of
cash from Torchmark Capital, and will not receive the cash related to such
income if such a holder disposes of the Series A Preferred Securities prior to
the record date for payment of dividends. See "Certain United States Income Tax
Consequences--Potential Extension of Interest Payment Period."
SPECIAL EVENT REDEMPTION
Torchmark is aware that the Department of the Treasury recently published a
notice concerning and may in the future review the federal income tax treatment
of the interest payable on obligations similar to the Loans. In addition, the
Department of the Treasury recently issued proposed regulations with respect to
abusive uses of partnership vehicles. While Torchmark does not believe that the
recent notices or the proposed regulations implicate this transaction,
Torchmark is unable to predict future governmental action. Therefore, in the
event that the Department of the Treasury further issues an official
interpretation of law or regulation to the effect that either (i) Torchmark
shall not be entitled to deduct interest for federal income tax purposes with
respect to the amounts being lent by Torchmark Capital to Torchmark, (ii)
Torchmark Capital is subject to federal income tax with respect to the interest
on the loans to Torchmark, or (iii) Torchmark Capital is subject to more than a
de minimis amount of other taxes, duties or other governmental charges, the
Series A Preferred Securities would be subject to redemption at the option of
Torchmark and/or Torchmark Capital, or, alternatively, could be left
outstanding, as described under "Description of Series A Preferred Securities--
Special Event Redemption."
S-7
<PAGE>
TORCHMARK CAPITAL L.L.C.
Torchmark Capital L.L.C., a wholly owned special purpose finance subsidiary
of Torchmark, is a limited liability company organized under the Delaware
Limited Liability Company Act (the "Delaware Act"). The initial members of
Torchmark Capital are Torchmark and Maxwell's Energy Company, Inc., a wholly-
owned subsidiary of Torchmark ("Maxwell's"). Torchmark and Maxwell's entered
into a limited liability company agreement of Torchmark Capital dated as of
March 11, 1994. Such limited liability company agreement will be amended and
restated in its entirety (as so amended and restated, the "LLC Agreement"). A
copy of the form of the LLC Agreement is included as an exhibit to the
Registration Statement on Form S-3 (File No. 33-51963) of which this Prospectus
Supplement forms a part (the "Registration Statement"). Torchmark Capital
exists solely for the purpose of issuing its common and preferred securities,
including the Series A Preferred Securities, and lending the net proceeds
thereof to Torchmark to finance Torchmark's and its subsidiaries' business
operations. Pursuant to the terms of the LLC Agreement, Torchmark will continue
to be a member of Torchmark Capital and Maxwell's will resign as a member of
Torchmark Capital effective as of the closing of the offering of the Series A
Preferred Securities. Torchmark will hold the common limited liability company
interests in Torchmark Capital (the "Common Securities"). The members which
hold Series A Preferred Securities will hold preferred limited liability
company interests in Torchmark Capital. The rights of the Series A Preferred
Security holders, including economic rights, rights to information and voting
rights, are set forth in the LLC Agreement and the Delaware Act. See
"Description of Series A Preferred Securities." Under the LLC Agreement,
holders of the Series A Preferred Securities are entitled to true and full
information regarding the state of the business and financial condition of
Torchmark Capital.
Torchmark Capital is a separate legal entity under the laws of the State of
Delaware and is distinct from its owners, who are known as "members." A
Delaware limited liability company is similar to a Delaware corporation in
providing limited liability to its members in a manner similar to that provided
to stockholders of a Delaware corporation. Therefore, unless expressly provided
in a limited liability company agreement or otherwise agreed, under Delaware
law no general liability exists for members or managers of a Delaware limited
liability company. The LLC Agreement provides that Torchmark will have general
liability for the debts and obligations of Torchmark Capital in the same manner
as a general partner of a Delaware limited partnership. Under Delaware law,
members who hold Series A Preferred Securities (other than Torchmark) will not
be liable for the debts, obligations and liabilities of Torchmark Capital,
whether arising in contract, tort or otherwise, solely by reason of being a
member of Torchmark Capital.
Financial statements of Torchmark Capital will be made available to holders
of Preferred Securities annually as soon as practicable after the end of
Torchmark Capital's fiscal year.
S-8
<PAGE>
TORCHMARK CORPORATION
Torchmark, an insurance and diversified financial services holding company,
was incorporated in Delaware on November 29, 1979 as Liberty National Insurance
Holding Company. Through a plan of reorganization, which became effective on
December 30, 1980, it became the parent company for the businesses operated by
Liberty National Life Insurance Company ("Liberty") and Globe Life And Accident
Insurance Company ("Globe"). United American Insurance Company ("United
American"), Waddell & Reed, Inc. ("W&R") and United Investors Life Insurance
Company ("UILIC"), along with their respective subsidiaries, were acquired in
1981. The name Torchmark Corporation was adopted on July 1, 1982. Family
Service Life Insurance Company ("Famlico") was purchased in July, 1990.
Through its life insurance subsidiaries, including Liberty, Globe, United
American, Famlico and American Life and Accident Insurance Company, Torchmark
offers a portfolio of life and health insurance products. Through United
Investors Management Company ("UIMCO"), a wholly-owned subsidiary which owns
W&R, UILIC and Torch Energy Advisors Incorporated, Torchmark offers
institutional investment management services and individual financial planning
and products, including life insurance, annuities and mutual funds; provides
management services with respect to oil and gas production and development; and
engages in energy property acquisitions and dispositions, oil and gas product
marketing and well operations. Torchmark maintains a 27% ownership interest in
Vesta Insurance Group, Inc. ("Vesta"), a property and casualty insurance
holding company, which owns Vesta Fire Insurance Corporation (formerly Liberty
National Fire Insurance Company), offering industrial fire insurance,
collateral protection insurance, personal and commercial property and casualty
insurance and domestic reinsurance.
The principal executive office of Torchmark is located at 2001 Third Avenue
South, Birmingham, Alabama 35233, and its telephone number is (205) 325-4200.
USE OF PROCEEDS
The net proceeds from the sale of the Series A Preferred Securities by
Torchmark Capital will be lent to Torchmark pursuant to the Loan Agreement
described herein and will be used for general corporate purposes, which may
include, without limitation, repayment of bank debt, the repurchase of
Torchmark's Common Stock, and possible acquisitions.
DESCRIPTION OF SERIES A PREFERRED SECURITIES
The following is a summary of the material terms and provisions of the Series
A Preferred Securities offered hereby. All of the limited liability company
interests of Torchmark Capital other than the Series A Preferred Securities are
beneficially owned directly or indirectly by Torchmark. The LLC Agreement will
authorize and create the Series A Preferred Securities. The Series A Preferred
Securities constitute a series of preferred limited liability company interests
("Preferred Securities") of Torchmark Capital, which Preferred Securities may
be issued in one or more series from time to time. The LLC Agreement and the
Certificate of Formation of Torchmark Capital (the "Certificate") establish, or
authorize Torchmark as the Managing Member of Torchmark Capital to establish,
the designations, dividend rights, liquidation value per security, redemption
provisions, voting rights and other rights, preferences, privileges,
limitations and restrictions relating to Preferred Securities of Torchmark
Capital. The summary of the material terms and provisions of the Series A
Preferred Securities set forth below does not purport to be complete and is
subject to, and qualified in its entirety by reference to, the LLC Agreement
and the Certificate establishing the rights, preferences, privileges,
limitations and restrictions relating to the Series A Preferred Securities.
Copies of the LLC Agreement and the Certificate have been filed as exhibits to
the Registration Statement.
S-9
<PAGE>
GENERAL
Torchmark Capital is authorized to issue up to of its preferred limited
liability company interests in one or more series or classes, with such
dividend rights, liquidation preferences, redemption provisions, voting rights
and other rights, preferences, privileges, limitations and restrictions as may
be determined by the Managing Member, as set forth in the LLC Agreement. The
Managing Member has approved the issuance of Preferred Securities as Series
A Preferred Securities. The LLC Agreement will not permit the issuance of any
Preferred Securities of Torchmark Capital ranking, as to participation in
profits or the assets of Torchmark Capital, senior to the Series A Preferred
Securities.
DIVIDENDS
Cumulative dividends on the Series A Preferred Securities will accrue from
, 1994 and are payable monthly in arrears on the last day of each
calendar month of each year, commencing , 1994, when, as and if declared
by Torchmark Capital, except as otherwise described below.
The dividends payable on each Series A Preferred Security will be fixed at a
rate per annum of % of the liquidation preference thereof ($ per security).
The amount of the dividends is computed on the basis of twelve 30-day months
and a 360-day year and, for any period shorter than a full monthly period, will
be computed on the basis of the actual number of days elapsed in such period.
Payment of dividends is limited in relation to the amount of funds held by
Torchmark Capital and legally available therefor.
Dividends on the Preferred Securities of any series will be cumulative
(whether or not declared and whether or not there are profits, surplus or other
funds legally available for the payment of dividends).
Dividends on the Series A Preferred Securities must be declared by Torchmark
Capital, by action of Torchmark, as Managing Member of Torchmark Capital, in
any calendar year or portion thereof to the extent that the Managing Member
reasonably determines that at the time of payment Torchmark Capital will have,
and must be paid by Torchmark Capital to the extent that at the time of payment
Torchmark Capital has, funds legally available for the payment of such
dividends and cash on hand sufficient to permit such dividends. It is
anticipated that Torchmark Capital's earnings will result exclusively from
payments under the Loans (as defined herein) of the proceeds from the sale of
the Series A Preferred Securities and other Preferred Securities, if any, and
the issuance of the Common Securities (as described under "Description of the
Loans").
Dividends declared on the Series A Preferred Securities are payable to the
record holders thereof as they appear on the register for the Series A
Preferred Securities on the record date, which will be one Business Day prior
to the relevant payment date. Subject to applicable laws and regulations, each
such payment will be made as described under "Book-Entry-Only Issuance--The
Depository Trust Company" below. In the event that any date on which dividends
are payable with respect to the Series A Preferred Securities is not a Business
Day, then payment of the dividend 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. A "Business Day" shall mean any day other than a day
on which banking institutions in The City of New York are authorized or
required by law to close.
CERTAIN RESTRICTIONS ON TORCHMARK CAPITAL
If dividends have not been paid in full on the Series A Preferred Securities,
Torchmark Capital may not:
(i) pay, or declare and set aside for payment, any dividends on any other
preferred securities of Torchmark Capital ranking pari passu with the
Series A Preferred Securities as regards participation in profits of
Torchmark Capital ("Company Dividend Parity Securities"), unless the amount
of any dividends made with respect to any Company Dividend Parity
Securities is made with respect to
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Company Dividend Parity Securities and the Series A Preferred Securities on
a pro rata basis on the date such dividends are paid with respect to such
Company Dividend Parity Securities, so that
(x) the ratio of (a) the aggregate amount of dividends paid with
respect to the Series A Preferred Securities divided by (b) the
aggregate amount of dividends paid with respect to such Company
Dividend Parity Securities, equals
(y) the ratio of (a) the aggregate of all accrued and unpaid
dividends in respect of the Series A Preferred Securities, divided by
(b) the aggregate of all accrued and unpaid dividends in respect of
such Company Dividend Parity Securities;
(ii) pay, or declare and set aside for payment, any dividends on the
Common Securities or any other securities of Torchmark Capital ranking
junior to the Series A Preferred Securities as to dividends ("Company
Dividend Junior Securities"); or
(iii) redeem, purchase or otherwise acquire any Company Dividend Parity
Securities or Company Dividend Junior Securities or any Series A Preferred
Securities other than the redemption of all outstanding Series A Preferred
Securities at the redemption price of $ per Series A Preferred Security
plus accumulated and unpaid Preferred Security dividends to the date fixed
for redemption (the "Redemption Price");
until, in each case, such time as all accumulated arrears of unpaid dividends
(whether or not declared) on the Series A Preferred Securities shall have been
paid in full for all dividend periods terminating on or prior to, in the case
of clauses (i) and (ii), such payment, and in the case of clause (iii), the
date of such redemption, purchase or acquisition.
As of the date of this Prospectus Supplement, there are no Company Dividend
Parity Securities outstanding, and Torchmark Capital does not have any current
plans to issue Company Dividend Parity Securities.
MANDATORY REDEMPTION
The proceeds from any prepayment or repayment of principal by Torchmark on
the Loans of the proceeds from the issuance and sale of the Series A Preferred
Securities and the Common Securities must be applied to redeem the Series A
Preferred Securities at the Redemption Price, upon not less than 30 nor more
than 60 days' notice; provided that amounts of repayment may instead be lent
to or relent to Torchmark and not used for such redemption if at the time of
such new loan, and as determined in the judgment of Torchmark, as Managing
Member, and Torchmark Capital's financial advisor (selected by Torchmark, as
Managing Member), (a) Torchmark is not in bankruptcy, (b) Torchmark is not in
default on any loan pertaining to Preferred Securities of any series, (c)
Torchmark has made timely monthly payments on the repaid loan for the
immediately preceding 18 months, (d) Torchmark Capital is not in arrears on
payment of dividends on the Series A Preferred Securities, (e) Torchmark is
expected to be able to make timely payment of principal and interest on such
new loan, (f) such new loan is being made on terms, and under circumstances,
that are consistent with those which a lender would require for a loan to an
unrelated party, (g) such loan is being made at a rate sufficient to provide
payments equal to or greater than the amount of dividend payments that accrue
on the Series A Preferred Securities, (h) the senior unsecured long-term debt
of Torchmark is rated BBB- or better by Standard & Poor's Corporation or Baa3
or better by Moody's Investors Services, Inc. or the equivalent by any other
nationally recognized statistical rating organization, (i) such loan is being
made for a term that is consistent with market circumstances and Torchmark's
financial condition, and (j) such loan will have a final maturity no later
than the fiftieth anniversary of the issuance of the Series A Preferred
Securities.
OPTIONAL REDEMPTION
The Series A Preferred Securities are redeemable, at the option of Torchmark
Capital (subject to the prior consent of Torchmark), in whole or in part from
time to time, on or after , 1999, upon
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not less than 30 nor more than 60 days' notice, at the Redemption Price. In the
event that fewer than all the outstanding Series A Preferred Securities are to
be redeemed (other than in a case where such partial redemption would result in
delisting as described below, if the Series A Preferred Securities are listed
on a securities exchange), the Series A Preferred Securities to be redeemed
will be selected as described under "Book-Entry-Only Issuance--The Depository
Trust Company" below. Torchmark Capital will not redeem fewer than all the
outstanding Series A Preferred Securities unless all accumulated arrears of
unpaid dividends have been paid on all Series A Preferred Securities for all
monthly dividend periods terminating on or prior to the date of redemption.
SPECIAL EVENT REDEMPTION
If a Tax Event or an Investment Company Act Event (as defined below)
(collectively, a "Special Event") shall occur and be continuing, Torchmark
and/or Torchmark Capital may elect to redeem the Series A Preferred Securities
in whole (and not in part), upon not less than 30 or more than 60 days' notice
at the Redemption Price within 90 days following the occurrence of such Special
Event.
"Tax Event" means that Torchmark or Torchmark Capital shall have obtained an
opinion of independent counsel experienced in such matters to the effect that,
as a result of any amendment to, or change in, the laws (or any regulations
thereunder) of the United States or any political subdivision or governmental
authority thereof or therein, or any amendment to or change in an official or
judicial interpretation or application of such laws or regulations, which
amendment or change is effective on or after April 30, 1994, there is more than
an insubstantial risk that (i) Torchmark Capital is subject to federal income
tax with respect to interest received on the Loans to Torchmark, (ii) Torchmark
shall not be entitled to deduct interest for Federal income tax purposes with
respect to the amounts being lent by Torchmark Capital to members of
Torchmark's consolidated group (a Tax Event occurring solely by reason of this
clause (ii), a "Special Loan Tax Event"), or (iii) Torchmark Capital is subject
to more than a de minimis amount of other taxes, duties or other governmental
charges.
"Investment Company Act Event" means the occurrence of a change in law or
regulation or a written change in official interpretation of law or regulation
by any legislative body, court, governmental agency or regulatory authority (a
"Change in 1940 Act Law"), to the effect that Torchmark Capital is or will be
considered an "Investment Company" required to be registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), which Change in
1940 Act Law becomes effective on or after April 30, 1994; provided that no
Investment Company Act Event shall be deemed to have occurred if Torchmark
and/or Torchmark Capital delivers a written opinion of independent counsel to
Torchmark Capital experienced in practice under the 1940 Act, to the effect
that Torchmark and/or Torchmark Capital has successfully taken either of the
steps set forth in (i) or (ii) below to avoid such Change in 1940 Act Law so
that in the opinion of such counsel, notwithstanding such Change in 1940 Act
Law, Torchmark Capital is not required to be registered as an "investment
company" within the meaning of the 1940 Act. Such steps shall be either (i)
issuing an additional or supplemental irrevocable and unconditional guarantee
(x) of accumulated and unpaid dividends (whether or not declared out of moneys
legally available therefor) on the Series A Preferred Securities and (y) upon a
liquidation of Torchmark Capital, of the full amount of the Liquidation
Distribution (as hereinafter defined) on the Series A Preferred Securities
(regardless of the amount of assets of Torchmark Capital otherwise available
for distribution in such liquidation), or (ii) the use of any other reasonable
measures that do not adversely affect holders of Series A Preferred Securities.
REDEMPTION PROCEDURES
If Torchmark Capital gives a notice of redemption in respect of Series A
Preferred Securities, then, by 12:00 noon, New York time, on the redemption
date, Torchmark Capital will irrevocably deposit with The Depository Trust
Company funds sufficient to pay the applicable Redemption Price, and will give
The Depository Trust Company irrevocable instructions and authority to pay the
Redemption Price to the holders thereof. See "Book-Entry-Only Issuance--The
Depository Trust Company." If notice of redemption shall
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have been given and funds deposited as required, then upon the date of such
deposit, all rights of holders of Series A Preferred Securities so called for
redemption will cease, except the right of the holders of such securities 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 Series A Preferred Securities 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 Series A Preferred Securities is improperly withheld or refused and
not distributed either by Torchmark Capital or by Torchmark pursuant to the
Guarantee, dividends on such securities will continue to accrue, at the then
applicable rate, from the original redemption date to the date of payment, in
which case the actual payment date will be considered the date fixed for
redemption for purposes of calculating the Redemption Price.
Subject to the foregoing and applicable law (including, without limitation,
applicable United States federal and state securities laws), Torchmark 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;
provided, that neither Torchmark nor its susidiaries may purchase outstanding
Series A Preferred Securities if the purchase would result in a termination of
Torchmark Capital for federal income tax purposes.
LIQUIDATION DISTRIBUTION
In the event of any voluntary or involuntary liquidation, dissolution,
termination or winding up of Torchmark Capital, the holders of Series A
Preferred Securities at the time outstanding will be entitled to receive out of
the assets of Torchmark Capital legally available for distribution to
securityholders, before any distribution of assets is made to holders of Common
Securities or any other class of securities of Torchmark Capital ranking junior
to the Series A Preferred Securities as regards participation in assets of
Torchmark Capital, but together with the holders of every other series of
preferred or preference limited liability company interests of Torchmark
Capital outstanding, if any, ranking pari passu with the Series A Preferred
Securities as regards participation in the assets of Torchmark Capital
("Company Liquidation Parity Securities"), an amount equal, in the case of the
holders of the Series A Preferred Securities, to the aggregate of the
liquidation preference of $ per Series A Preferred Security and all accrued
and unpaid dividends (whether or not declared) to the date of payment (the
"Liquidation Distribution"). If, upon any such liquidation, the Liquidation
Distribution can be made only in part because Torchmark Capital has
insufficient assets available to make in full the aggregate Liquidation
Distribution and the aggregate maximum liquidation distributions on Company
Liquidation Parity Securities, then the amounts payable directly by Torchmark
Capital on the Series A Preferred Securities and on such Company Liquidation
Parity Security shall be distributed on a pro rata basis, so that
(i) the ratio of (x) the aggregate amount distributed in respect of the
Liquidation Distribution, divided by (y) the aggregate amount distributed
as liquidation distributions on Company Liquidation Parity Securities,
equals
(ii) the ratio of (x) the aggregate Liquidation Distribution, divided by
(y) the aggregate maximum liquidation distribution on Company Liquidation
Parity Securities.
Pursuant to the LLC Agreement, Torchmark Capital shall be dissolved and its
affairs shall be wound up: (i) upon the expiration of the term of Torchmark
Capital; (ii) upon the retirement, resignation, expulsion, bankruptcy or
dissolution of Torchmark, or the occurrence of any other event under the
Delaware Act that terminates the continued membership of Torchmark, as the
Common Holder of Torchmark Capital except for a transfer to a permitted
successor of the Common Holder as set forth in the LLC Agreement, (iii) the
entry of decree of a judicial dissolution, or (iv) the written consent of all
members of Torchmark Capital, including the holders of the Series A Preferred
Securities.
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PERSONAL LIABILITY OF HOLDERS OF COMMON SECURITIES
Torchmark, in its capacity as holder of the Common Securities, will be liable
for, and will pay (as an additional capital contribution to Torchmark Capital)
the debts of and claims against Torchmark Capital (other than the obligations
to holders of Series A Preferred Securities or other equity securities of
Torchmark Capital).
MERGER, CONSOLIDATION, AMALGAMATION, ETC. OF TORCHMARK CAPITAL
Torchmark, as the managing member of Torchmark Capital (the "Managing
Member"), is authorized to conduct its affairs and to operate Torchmark Capital
in such a way that Torchmark Capital would not be deemed to be an "investment
company" required to be registered under the 1940 Act or taxed as a corporation
for federal income tax purposes and so that any loans made by Torchmark Capital
to Torchmark will be treated as indebtedness for federal income tax purposes.
In this connection, the Managing Member is authorized to take any action that
(i) is not inconsistent with applicable law, the Certificate of Formation of
Torchmark Capital or the LLC Agreement, (ii) does not materially adversely
affect the holders of Series A Preferred Securities and (iii) the Managing
Member determines in its sole discretion to be necessary or desirable for such
purposes.
Torchmark Capital may not consolidate, amalgamate, merge with or into, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except as
described below. Torchmark Capital may, for purposes of changing its state of
domicile or avoiding federal income tax or 1940 Act consequences adverse to
Torchmark or Torchmark Capital or holders of Series A Preferred Securities,
without the consent of the holders of the Series A Preferred Securities,
consolidate, amalgamate, merge with or into, or be replaced by a limited
liability company or limited partnership or trust organized as such under the
laws of any state of the United States of America, provided that (i) such
successor entity either (x) expressly assumes all of the obligations of
Torchmark Capital under the Series A Preferred Securities or (y) substitutes
for the Series A Preferred Securities other securities having substantially the
same terms as the Series A Preferred Securities (the "Successor Securities") so
long as the Successor Securities rank, with respect to participation in the
profits or assets of the successor entity, at least as high as the Series A
Preferred Securities rank, with respect to participation in the profits or
assets of Torchmark Capital, (ii) Torchmark expressly acknowledges such
successor entity as the holder of the Loans to it relating to the Series A
Preferred Securities, (iii) such merger, consolidation, amalgamation or
replacement does not cause the Series A Preferred Securities to be delisted by
any national securities exchange or other organization on which the Series A
Preferred Securities are then listed, if any, (iv) such merger, consolidation,
amalgamation or replacement does not cause the Series A Preferred Securities to
be downgraded by any "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, (v) such merger, consolidation,
amalgamation or replacement does not adversely affect the powers, preferences
and other special rights of holders of Series A Preferred Securities in any
material respect, (vi) prior to such merger or consolidation Torchmark has
received an opinion of independent counsel to Torchmark Capital experienced in
such matters to the effect that (w) holders of outstanding Series A Preferred
Securities will not recognize any gain or loss for federal income tax purposes
as a result of the merger, consolidation, amalgamation or replacement, (x) such
successor entity will be treated as a partnership for federal income tax
purposes, (y) following such merger, consolidation, amalgamation or
replacement, Torchmark and such successor entity will be in compliance with the
1940 Act without registering thereunder as an investment company, and (z) such
merger, consolidation, amalgamation or replacement will not adversely affect
the limited liability of holders of Series A Preferred Securities.
VOTING RIGHTS
Except as provided below and under "Description of the Guarantee--Amendments
and Assignments" and "Description of the Loans--Miscellaneous," the holders of
the Series A Preferred Securities will have no voting rights.
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If (i) Torchmark Capital fails to pay dividends in full on the Series A
Preferred Securities (whether or not there are funds legally available
therefor) for 18 consecutive monthly dividend periods, (ii) an Event of Default
(as defined in the Loan Agreement relating to the Loans) occurs and is
continuing on the Loans (as described in "Description of the Loans") or (iii)
Torchmark is in default under any of its payment or other obligations under the
Guarantee (as described under "Description of the Guarantee"), then the holders
of outstanding Series A Preferred Securities, together with the holders of any
other preferred or preference securities of Torchmark Capital having the right
to vote for the appointment of a trustee in such event, acting as a single
class, will be entitled, by resolution passed by the holders of a majority in
liquidation preference (plus all accrued and unpaid dividends) of such
securities present in person or by proxy at a meeting of such holders convened
for such purpose (or by written consent), to appoint and authorize a trustee to
enforce Torchmark Capital's rights as a creditor under the Loans against
Torchmark (including the acceleration of principal and accrued interest on the
Loans), enforce the obligations undertaken by Torchmark under the Guarantee and
declare and pay dividends on the Series A Preferred Securities; provided, that
in the event such holders are entitled to appoint a trustee pursuant solely to
section (i) above and Torchmark has elected to extend the interest payment
period as provided under "Description of the Loans--Option to Extend Interest
Payment Period," the trustee shall not be entitled to exercise such powers
until the expiration of the extended interest payment period or until the
occurrence of another event of default under section (ii) or (iii) above.
Notwithstanding the appointment of any such trustee, Torchmark retains all
rights under the Loan Agreements, including the right to extend the interest
payment period for up to 60 months as provided under "Description of the
Loans--Option to Extend Interest Payment Period." During any such extension,
dividends on Series A Preferred Securities will be deferred, but holders will
be required to include interest from the Loans in income for federal tax
purposes. See "Certain United States Income Tax Consequences."
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, any trustee, in its own name and as trustee of an express
trust, may institute a proceeding, including, without limitation, any suit in
equity, an action in law or other judicial or administrative proceeding, to
enforce Torchmark Capital's creditor rights directly against Torchmark or any
other obligor in connection with such obligations to the same extent as
Torchmark Capital and on behalf of Torchmark Capital, and may prosecute such
proceeding to judgment or final decree, and enforce the same against Torchmark
or any other obligor in connection with such obligations and collect, out of
the property, wherever situated, of Torchmark or any such other obligor upon
such obligations, the monies adjudged or decreed to be payable in the manner
provided by law.
For purposes of determining whether Torchmark Capital has failed to pay
dividends in full for 18 consecutive monthly dividend periods, dividends shall
be deemed to remain in arrears, notwithstanding any payments in respect
thereof, until full cumulative dividends have been or contemporaneously are
declared and paid with respect to all monthly dividend periods terminating on
or prior to the date of payment of such full cumulative dividends. Not later
than 30 days after such entitlement arises, the Managing Member will convene a
meeting for the above purpose. If the Managing Member fails to convene such
meeting within such 30-day period, the holders of 10% in liquidation preference
(plus all accumulated arrears and accruals of unpaid dividends) of the
outstanding Series A Preferred Securities and such other preferred or
preference securities will be entitled to convene such meeting. The provisions
of the LLC Agreement relating to the convening and conduct of the meetings of
securityholders will apply with respect to any such meeting. Any trustee so
appointed shall vacate office immediately, subject to the terms of such other
preferred or preference securities, if Torchmark Capital (or Torchmark pursuant
to the Guarantee) shall have paid in full all accrued and unpaid dividends on
the Series A Preferred Securities or such default or breach by Torchmark, as
the case may be, shall have been cured.
If any resolution is proposed for adoption by the securityholders of
Torchmark Capital providing for, or the Managing Member proposes to effect (it
being understood that the automatic dissolution and liquidation events
described in (iii) and (iv) under "Liquidation Distribution" above will not be
deemed to be a proposal by the Managing Member), (x) any action which would
adversely affect the powers, preferences or special
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rights of the Series A Preferred Securities by way of amendment of Torchmark
Capital's LLC Agreement or otherwise (including, without limitation, the
authorization or issuance of any securities of Torchmark Capital ranking, as to
participation in the profits or assets of Torchmark Capital, senior to the
Series A Preferred Securities), or (y) the liquidation, dissolution or winding
up of Torchmark Capital, then the holders of outstanding Preferred Securities
of all series (and, in the case of a resolution described in clause (x) above
which would equally adversely affect the rights, preferences or privileges of
any Company Dividend Parity Securities or any Company Liquidation Parity
Securities, such Company Dividend Parity Securities or such Company Liquidation
Parity Securities, as the case may be, or, in the case of any resolution
described in clause (y) above, all Company Liquidation Parity Securities) will
be entitled to vote together as a class on such resolution or action of the
Managing Member (but not on any other resolution or action), and such
resolution or action shall not be effective except with the approval of the
holders of 66 2/3% in liquidation preference (plus all accrued and unpaid
dividends) of such outstanding securities; provided, however, that no such
approval or ratification shall be required if the liquidation, dissolution and
winding up of Torchmark Capital is proposed or initiated upon the initiation of
proceedings, or after proceedings have been initiated, for the liquidation,
dissolution, or winding up of Torchmark.
No vote or consent of the holders of the Series A Preferred Securities will
be required for Torchmark Capital to redeem or cancel Series A Preferred
Securities in accordance with the LLC Agreement and the Resolutions.
The rights attached to the Series A Preferred Securities will be deemed not
to be varied by the creation or issue of, and no vote will be required for the
creation of, any further series of preferred or preference securities or any
further securities of Torchmark Capital ranking as regards participation in the
profits or assets of Torchmark Capital pari passu with or junior to the Series
A Preferred Securities.
Any required approval of holders of Series A Preferred Securities may be
given at a meeting of such holders convened for such purpose, at a general
meeting of securityholders of Torchmark Capital or pursuant to written consent.
Torchmark Capital will cause a notice of any meeting at which holders of the
Series A Preferred Securities are entitled to vote, or of any matter upon which
action by written consent of such holders is to be taken, to be mailed to each
holder of record of the Series A Preferred Securities. Each such notice will
include a statement setting forth (i) the date of such meeting or the date by
which such action is to be taken, (ii) a description of any resolution proposed
for adoption at such meeting on which such holders are entitled to vote or of
such matter upon which written consent is sought and (iii) instructions for the
delivery of proxies or written consents.
Notwithstanding that holders of Series A Preferred Securities are entitled to
vote or consent under any of the circumstances described above, any of the
Series A Preferred Securities and such other preferred or preference securities
entitled to vote or consent with such Series A Preferred Securities as a single
class outstanding at such time, that are owned by Torchmark or any entity owned
50% or more by Torchmark, either directly or indirectly, shall not be entitled
to vote or consent and shall, for the purposes of such vote or consent, be
treated as if they were not outstanding.
BOOK-ENTRY-ONLY ISSUANCE--THE DEPOSITORY TRUST COMPANY
The Depository Trust Company ("DTC"), New York, New York, will act as
securities depository for the Series A Preferred Securities. The Series A
Preferred Securities will be issued as fully registered securities registered
in the name of Cede & Co. (DTC's partnership nominee). One or more fully
registered global Series A Preferred Security certificates will be issued,
representing in the aggregate the total number of Series A Preferred
Securities, and will be deposited with DTC.
DTC is a limited-purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing
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agency" registered pursuant to the provisions of Section 17A of the Securities
Exchange Act of 1934, as amended. DTC holds securities that its participants
("Participants") deposit with DTC. DTC also facilitates the settlement among
Participants of securities transactions, such as transfers and pledges, in
deposited securities through electronic computerized book-entry changes in
Participants' accounts, thereby eliminating the need for physical movement of
securities certificates. Direct Participants include securities brokers and
dealers, banks, trust companies, clearing corporations and certain other
organizations ("Direct Participants"). DTC is owned by a number of its Direct
Participants and by the New York Stock Exchange, Inc., the American Stock
Exchange, Inc. and the National Association of Securities Dealers, Inc. Access
to the DTC system is also available to others such as securities brokers and
dealers, banks and trust companies that clear through or maintain a custodial
relationship with a Direct Participant, either directly or indirectly
("Indirect Participants"). The Rules applicable to DTC and its Participants are
on file with the Securities and Exchange Commission.
Purchases of Series A Preferred Securities under the DTC system must be made
by or through Direct Participants, which will receive a credit for the Series A
Preferred Securities on DTC's records. The ownership interest of each actual
purchaser of each Series A Preferred Security ("Beneficial Owner") is in turn
to be recorded on the Direct and Indirect Participants' records. Beneficial
Owners will not receive written confirmation from DTC of their purchase, but
Beneficial Owners are expected to receive written confirmations providing
details of the transaction, as well as periodic statements of their holdings,
from the Direct or Indirect Participants through which the Beneficial Owner
purchased Series A Preferred Securities. Transfers of ownership interests in
the Series A Preferred Securities are to be accomplished by entries made on the
books of Participants acting on behalf of Beneficial Owners. Beneficial Owners
will not receive certificates representing their ownership interests in Series
A Preferred Securities, except in the event that use of the book-entry system
for the Series A Preferred Securities is discontinued.
DTC has no knowledge of the actual Beneficial Owners of the Series A
Preferred Securities; DTC's records reflect only the identity of the Direct
Participants to whose accounts such Series A Preferred Securities are credited,
which may or may not be the Beneficial Owners. The Participants will remain
responsible for keeping account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct Participants,
by Direct Participants to Indirect Participants, and by Direct Participants and
Indirect Participants to Beneficial Owners will be governed by arrangements
among them, subject to any statutory or regulatory requirements as may be in
effect from time to time.
Redemption notices will be sent to Cede & Co. If less than all of the Series
A Preferred Securities are being redeemed, DTC's practice is to determine by
lot the amount of the interest of each Direct Participant in such series to be
redeemed.
Although voting with respect to the Series A Preferred Securities is limited,
in those cases where a vote is required, neither DTC nor Cede & Co. will
consent or vote with respect to Series A Preferred Securities. Under its usual
procedures, DTC mails an Omnibus Proxy to Torchmark Capital as soon as possible
after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or
voting rights to those Direct Participants to whose accounts the Series A
Preferred Securities are credited on the record date (identified in a listing
attached to the Omnibus Proxy).
Dividend payments on the Series A Preferred Securities will be made to DTC.
DTC's practice is to credit Direct Participants' accounts on the relevant
payable date in accordance with their respective holdings shown on DTC's
records, unless DTC has reason to believe that it will not receive payments on
such date. Payments by Participants to Beneficial Owners will be governed by
standing instructions and customary practices and will be the responsibility of
such Participant and not of DTC, Torchmark Capital or Torchmark, subject to any
statutory or regulatory requirements as may be in effect from time to time.
Payment of dividends to DTC is the responsibility of Torchmark Capital,
disbursement of such payments to Direct Participants will be the
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responsibility of DTC, and disbursement of such payments to the Beneficial
Owners will be the responsibility of Direct and Indirect Participants.
DTC may discontinue providing its services as securities depository with
respect to the Series A Preferred Securities at any time by giving reasonable
notice to Torchmark Capital. Under such circumstances, in the event that a
successor securities depository is not obtained, Series A Preferred Security
certificates are required to be printed and delivered. In addition, Torchmark
Capital (with the consent of Torchmark) may decide to discontinue use of the
system of book-entry transfers through DTC (or a successor Depository). In that
event, certificates for the Series A Preferred Securities will be printed and
delivered.
The information in this section concerning DTC and DTC's book-entry system
has been obtained from sources that Torchmark Capital and Torchmark believe to
be reliable, but neither Torchmark Capital nor Torchmark has independently
verified such information.
REGISTRAR, TRANSFER AGENT AND PAYING AGENT
The First Chicago Trust Company of New York will act as registrar, transfer
agent and paying agent for the Series A Preferred Securities (the "Paying
Agent").
Registration of transfers of Series A Preferred Securities will be effected
without charge by or on behalf of Torchmark Capital, but upon payment (with the
giving of such indemnity as Torchmark Capital or Torchmark may require) in
respect of any tax or other governmental charges which may be imposed in
relation to it.
Torchmark Capital will not be required to register or cause to be registered
the transfer of Series A Preferred Securities after such securities have been
called for redemption.
MISCELLANEOUS
Torchmark Capital is not subject to any mandatory sinking fund provisions
with respect to the Series A Preferred Securities. Holders of Series A
Preferred Securities have no preemptive rights.
DESCRIPTION OF THE GUARANTEE
Set forth below is a summary of information concerning the Payment and
Guarantee Agreement (the "Guarantee") which will be executed and delivered by
Torchmark for the benefit of the holders from time to time of Series A
Preferred Securities. References to the provisions of the Guarantee are
qualified in their entirety by reference to the full text of the Guarantee, the
form of which is included as an exhibit to the Registration Statement.
GENERAL
Torchmark will irrevocably and unconditionally agree, to the extent set forth
herein, to pay in full, to the holders of the Preferred Securities of any
series which may be issued by Torchmark Capital, including the Series A
Preferred Securities, the Guarantee Payments (as defined below) (except to the
extent paid by Torchmark Capital), as and when due, regardless of any defense,
right of set-off or counterclaim which Torchmark Capital may have or assert.
The following payments to the extent not paid by Torchmark Capital constitute
the Guarantee Payments for the Series A Preferred Securities (without
duplication): (i) accumulated and unpaid dividends which have been declared on
the Series A Preferred Securities out of moneys legally available therefor,
(ii) the Redemption Price (including all accumulated and unpaid dividends)
payable out of moneys legally available therefor with respect to Series A
Preferred Securities called for redemption by Torchmark Capital, and (iii)
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in the event of liquidation of Torchmark Capital, the lesser of (a) the
liquidation preference plus all accumulated and unpaid dividends (whether or
not declared) to the date of payment and (b) the amount of assets of Torchmark
Capital legally available to holders of Series A Preferred Securities.
Torchmark's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by Torchmark to the holders of Preferred
Securities of any series or by causing Torchmark Capital to pay such amounts to
such holders.
If Torchmark fails to make interest payments required under the Loan
Agreement, Torchmark Capital will not have sufficient funds to declare or pay
dividends on the Series A Preferred Securities. The Guarantee does not cover
payment of such undeclared and unpaid dividends. In such event, the remedies of
a holder of Series A Preferred Securities are described under "Description of
the Loan Agreement--Enforcement."
CERTAIN COVENANTS OF TORCHMARK
In the Guarantee, Torchmark will covenant that, so long as any Preferred
Securities of any series remain outstanding, neither Torchmark nor any majority
owned subsidiary of Torchmark, shall declare or pay any dividend on, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of
Torchmark's capital stock or make any guarantee payments with respect to the
foregoing (other than payments under the Guarantee or dividends or guarantee
payments to Torchmark or another majority-owned subsidiary by a majority-owned
subsidiary of Torchmark or a declaration of a dividend consisting of common or
preferred stock purchase rights under a stockholder rights plan), if at such
time Torchmark shall be in default with respect to its payment or other
obligations under the Guarantee, or there shall have occurred any event that,
with the giving of notice or the lapse of time or both, would constitute an
Event of Default under the Loans.
In the Guarantee, Torchmark will also covenant that, so long as any Preferred
Securities of any series remain outstanding, Torchmark will (i) maintain direct
or indirect 100% ownership of the Common Securities and any other securities of
Torchmark Capital other than the Preferred Securities, (ii) cause at least 21%
of the total value (initially measured by security holders' equity determined
in accordance with generally accepted accounting principles) of Torchmark
Capital and at least 21% of all interests in the capital, income, gain, loss,
deduction and credit of Torchmark Capital to be represented by Common
Securities, unless the Internal Revenue Code of 1986, as amended (the "Code")
or the regulations or interpretations thereunder permit a lower percentage,
(iii) not voluntarily dissolve, wind-up or liquidate Torchmark Capital, (iv)
remain the Managing Member of Torchmark Capital and timely perform all of its
duties as Managing Member of Torchmark Capital (including the duty to cause
Torchmark Capital to declare and pay dividends on the Preferred Securities)
provided that any permitted successor of Torchmark under the Loan Agreement may
succeed to Torchmark's duties as Managing Member, and (v) use reasonable
efforts to cause Torchmark Capital to remain a limited liability company and
otherwise continue to be treated as a partnership for United States federal
income tax purposes.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes which do not adversely affect the rights
of holders (in which case no vote will be required), the Guarantee may be
changed only with the prior approval of the holders of not less than 66 2/3% in
liquidation preference of all Preferred Securities of each series then
outstanding. The manner of obtaining any such approval of holders of Preferred
Securities will be as set forth under "Description of Series A Preferred
Securities--Voting Rights." All guarantees and agreements contained in the
Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of Torchmark and shall inure to the benefit of the holders of
all Preferred Securities then outstanding.
TERMINATION OF THE GUARANTEE
The Guarantee will terminate and be of no further force and effect as to a
series of Preferred Securities upon full payment of the Redemption Price of all
outstanding Preferred Securities of that series, and shall
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terminate completely upon full payment of the amounts payable upon liquidation
of Torchmark Capital. The Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any holder of Preferred
Securities of any such series must restore payment of any sums paid under the
Preferred Securities of such series or the Guarantee.
STATUS OF THE GUARANTEE
The Guarantee will constitute an unsecured obligation of Torchmark and will
rank (i) subordinate and junior in right of payment to all other liabilities of
Torchmark, (ii) pari passu with the most senior preferred or preference stock
of any series now or hereafter issued by Torchmark and any guarantee entered
into by Torchmark in respect of any preferred or preference securities of any
affiliate of Torchmark (unless such guarantee provides that it is subordinate
to the Guarantee) and (iii) senior to the common stock of Torchmark. At March
31, 1994, Torchmark had total liabilities of approximately $6.2 billion, all of
which are senior to the Guarantee. The Guarantee provides that each holder of
Series A Preferred Securities by acceptance thereof agrees to the subordination
provisions and other terms of the Guarantee.
The Guarantee will constitute a guarantee of payment and not of collection. A
holder of Preferred Securities may enforce the Guarantee directly against
Torchmark, and Torchmark will waive any right or remedy to require that any
action be brought against Torchmark Capital or any other person or entity
before proceeding against Torchmark. The Guarantee will not be discharged
except by payment of the Guarantee Payments in full to the extent not paid by
Torchmark Capital and by complete performance of all obligations under the
Guarantee.
GOVERNING LAW
The Guarantee will be governed by and construed in accordance with the laws
of the State of New York.
DESCRIPTION OF THE LOANS
Set forth below is a summary of the loans (the "Loans") from Torchmark
Capital to Torchmark of the proceeds from the issuance of (i) the Series A
Preferred Securities and (ii) the Common Securities and related capital
contributions ("Common Security Payments"). References to provisions of the
loan agreement (the "Loan Agreement") pertaining to the Loans are qualified in
their entirety by reference to the full text of the Loan Agreement, the form of
which is included as an exhibit to the Registration Statement. Torchmark's
obligations under the Loan Agreement will also be for the benefit of the
holders from time to time of the Series A Preferred Securities, and such
holders will be entitled to enforce the Loan Agreement directly against
Torchmark.
GENERAL
Pursuant to the Loan Agreement, Torchmark Capital has agreed to make the
Loans to Torchmark in an aggregate principal amount equal to $ , such amount
being the aggregate Liquidation Preference of the Series A Preferred Securities
issued and sold by Torchmark Capital of $ and the aggregate Common Security
Payments of $ .
The entire principal amount of the Loans will become due and payable
(together with any accrued and unpaid interest thereon) on the earliest of
, 2024 (subject to renewal at Torchmark Capital's option for up to an
additional 20 year term if the terms and conditions set forth in the next
paragraph are satisfied) or the date upon which Torchmark shall be dissolved,
wound up or liquidated or the date upon which Torchmark Capital shall be
dissolved, wound up or liquidated.
The Loans may be renewed and extended for an additional 20 year term if, as
of , 2024, and as determined in the judgment of Torchmark, as the
Managing Member, and Torchmark Capital's
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independent financial advisor (selected by Torchmark, as the Managing Member),
(a) Torchmark is not in bankruptcy, (b) Torchmark is not in default on any loan
pertaining to Preferred Securities of any series, (c) Torchmark has made timely
monthly payments on the repaid loan for the immediately preceding 18 months,
(d) Torchmark Capital is not in arrears on payment of dividends on the Series A
Preferred Securities, (e) Torchmark is expected to be able to make timely
payment of principal and interest on such new loan, (f) such new loan is being
made on terms, and under circumstances, that are consistent with those which a
lender would require for a loan to an unrelated party, (g) such loan is being
made at a rate sufficient to provide payments equal to or greater than the
amount of dividend payments that accrue on the Series A Preferred Securities,
(h) the senior unsecured long-term debt of Torchmark is rated BBB- or better by
Standard & Poor's Corporation or Baa3 or better by Moody's Investors Services,
Inc. or the equivalent by any other nationally recognized statistical rating
organization, (i) such loan is being made for a term that is consistent with
market circumstances and Torchmark's financial condition and (j) such loan will
have a final maturity no later than the fiftieth anniversary of the issuance of
the Series A Preferred Securities.
MANDATORY PREPAYMENT
If Torchmark Capital redeems Series A Preferred Securities in accordance with
the terms thereof, the Loans will become due and payable in a principal amount
equal to the aggregate liquidation preference of the Series A Preferred
Securities so redeemed, together with any and all interest accrued thereon. Any
payment pursuant to this provision shall be made prior to 12:00 noon, New York
time, on the date of such redemption or at such other time on such earlier date
as Torchmark Capital and Torchmark shall agree.
OPTIONAL PREPAYMENT
Torchmark will have the right to prepay the Loans, without premium or
penalty,
(i) in whole or in part (together with any accrued but unpaid interest on
the portion being prepaid) at any time on or after , 1999; and
(ii) in whole (together with all accrued and unpaid interest) at any time
upon the occurrence of a Special Event. See "Description of Series A
Preferred Securities--Optional Redemption," and "Description of Series A
Preferred Securities--Special Event Redemption."
INTEREST
The Loans will bear interest at an annual rate equal to % from the date they
are made until maturity. Such interest shall be payable on the last day of each
calendar month of each year, commencing , 1994. In the event that any
date on which interest is payable on the Loans 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, subject to certain rights of extension described
below.
EXTENDED INTEREST PAYMENT PERIOD
Torchmark shall have the right at any time or times during the term of the
Loans, so long as Torchmark is not in default in the payment of interest on the
Loans, to extend the interest payment period to up to 60 months; provided that
at the end of such period Torchmark shall pay all interest then accrued and
unpaid; and provided further that, during any such extended interest payment
period, or at any time during which there is an uncured Event of Default under
the Loans, Torchmark shall not declare or pay any dividends on, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of its
shares of common or preferred stock or make any guarantee payments with respect
to the foregoing (other than payments under the Guarantee or a declaration of a
dividend consisting of common or preferred stock purchase rights under a
stockholder rights plan). Prior to the termination of any such extended
interest payment period, Torchmark
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may further extend the interest payment period, provided that such extended
interest payment period together with all such further extensions thereof may
not exceed 60 months. Torchmark shall give Torchmark Capital notice of its
selection of such extended interest payment period one Business Day prior to
the earlier of (i) the date Torchmark Capital declares the related dividend or
(ii) the date Torchmark Capital is required to give notice of the record or
payment date of such related 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. Torchmark shall cause Torchmark Capital to give such notice of
Torchmark's selection of such extended interest payment period to the holders
of the Series A Preferred Securities.
METHOD AND DATE OF PAYMENT
Each payment by Torchmark of principal and interest on the Loans shall be
made to Torchmark Capital in lawful money of the United States, at such place
and to such accounts as may be designated by Torchmark Capital.
SET-OFF
Notwithstanding anything to the contrary in the Loan Agreement, Torchmark
shall have the right to set-off any payment it is otherwise required to make
thereunder with and to the extent Torchmark has theretofore made, or is
concurrently on the date of such payment making, a payment under the Guarantee.
SUBORDINATION
Torchmark and Torchmark Capital covenant and agree (and each holder of the
Series A Preferred Securities (and any trustee appointed by such holders) by
acceptance thereof agrees) that each of the Loans is subordinate and junior in
right of payment to all Senior Indebtedness as provided in the Loan Agreement.
The term "Senior Indebtedness" means the principal, premium, if any, and
interest on (i) all indebtedness of Torchmark, whether outstanding on the date
of the Loan Agreement or thereafter created, incurred or assumed, which is for
money borrowed, or evidenced by a note or similar instrument, (ii) any
indebtedness secured by a lien upon property owned by Torchmark and upon which
indebtedness Torchmark customarily pays or accrues interest, even though
Torchmark has not assumed or become liable for the payment of such
indebtedness, (iii) any indebtedness of others of the kinds described in the
preceding clause (i) or (ii) for which Torchmark is responsible or liable
(directly or indirectly, contingently or otherwise) as guarantor or otherwise,
and (iv) amendments, renewals, extensions and refundings of any such
indebtedness, unless in any instrument or instruments evidencing or securing
such indebtedness or pursuant to which the same is outstanding, or in any such
amendment, renewal, extension or refunding, it is expressly provided that such
indebtedness is not superior in right of payment to the Loans. The Senior
Indebtedness shall continue to be Senior Indebtedness and entitled to the
benefits of the subordination provisions irrespective of (i) any amendment,
modification or waiver of any term of the Senior Indebtedness or extension or
renewal of the Senior Indebtedness, (ii) any exchange or release of, or
nonperfection of any lien on or security interest in, any collateral, or any
release from, amendment or waiver of or consent to departure from any guaranty,
for all or any of the Senior Indebtedness, (iii) any other circumstance which
might otherwise constitute a defense available to or discharge of Torchmark
Capital to the holders of the Preferred Securities (or any trustee appointed by
such holders) in respect of the provisions of the Loan Agreement, or (iv) any
act or failure to act on the part of Torchmark or by any act or failure to act,
in good faith, by any holder of Senior Indebtedness, or by any noncompliance by
Torchmark with the terms of the Loan Agreement, regardless of any knowledge
thereof which any person may have or be otherwise charged with.
Upon the maturity of any Senior Indebtedness of Torchmark by lapse of time,
acceleration of maturity or otherwise, all Senior Indebtedness of Torchmark
then due and owing shall first be paid in full, or such payment duly provided
for in cash (or in securities or other property satisfactory to all of the
holders of such Senior Indebtedness), before any payment is made on account of
the Loans.
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In the event that (i) Torchmark shall default in the payment of any
principal, or premium, if any, or interest on any Senior Indebtedness when the
same becomes due and payable, whether at maturity or at a date fixed for
prepayment or otherwise or (ii) an event of default occurs with respect to any
Senior Indebtedness permitting the holders thereof to accelerate the maturity
thereof and written notice of such event of default is given to Torchmark by
the holders of Senior Indebtedness, then unless and until such default in
payment or event of default shall have been cured or waived or shall have
ceased to exist, no direct or indirect payment (in cash, property, securities,
by set-off or otherwise) may be made or agreed to be made on account of the
Loans or interest thereon or in respect of any repayment, redemption,
retirement, purchase or other acquisition of the Loans.
In the event of (i) any insolvency, bankruptcy, receivership, liquidation,
reorganization, readjustment, composition or other similar proceeding relating
to Torchmark, its creditors or its property, (ii) any proceeding for the
liquidation, dissolution or other winding up of Torchmark, voluntary or
involuntary, whether or not involving insolvency or bankruptcy proceedings,
(iii) any assignment by Torchmark for the benefit of creditors, or (iv) any
other marshaling of the assets of Torchmark, all Senior Indebtedness
(including, without limitation, interest accruing thereon after the
commencement of any such proceeding, assignment or marshalling of assets) shall
first be paid in full before any payment or distribution, whether in cash,
securities or other property, may be made by Torchmark on account of the Loans.
In any such event, any payment or distribution, whether in cash, securities or
other property (other than securities of Torchmark or any other corporation
provided for by a plan of reorganization or a readjustment, the payment of
which is subordinate, at least to the extent provided in the subordination
provisions of the Loan Agreement with respect to the indebtedness evidenced by
the Loans, to the payment of all Senior Indebtedness at the time outstanding
and to any securities issued in respect thereof under any such plan of
reorganization or readjustment), which would otherwise (but for the
subordination provision) be payable or deliverable in respect to the Loans
shall be paid or delivered directly to the holders of Senior Indebtedness (or
their representative or trustee) in accordance with the priorities then
existing among such holders until all Senior Indebtedness shall have been paid
in full. No present or future holder of any Senior Indebtedness may be
prejudiced in the right to enforce subordination of the indebtedness
constituting the Loans by any act or failure to act on the part of Torchmark.
Senior Indebtedness shall not be deemed to have been paid in full unless the
holders thereof shall have received cash, securities or other property equal to
the amount of such Senior Indebtedness then outstanding. Upon the payment in
full of all Senior Indebtedness, Torchmark Capital shall be subrogated to all
the rights of any holders of Senior Indebtedness to receive any further
payments or distribution applicable to the Senior Indebtedness until the Loans
shall have been paid in full, and such payments or distribution of cash,
securities or other property received by Torchmark Capital, by reason of such
subrogation, which otherwise would be paid or distributed to the holders of
Senior Indebtedness, shall, as between Torchmark and its creditors other than
the holders of Senior Indebtedness, on the one hand, and Torchmark Capital, on
the other, be deemed to be a payment by Torchmark on account of Senior
Indebtedness, and not on account of the Loans.
COVENANTS
Torchmark will covenant that neither Torchmark nor any majority-owned
subsidiary of Torchmark will declare or pay any dividend on, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of
Torchmark's capital stock, or make any guarantee payments with respect to the
foregoing (other than payments under the Guarantee, dividends or guarantee
payments to Torchmark or another majority owned subsidiary by a majority owned
subsidiary of Torchmark or a dividend consisting of common or preferred stock
purchase rights under a stockholder rights plan), if at such time there shall
have occurred any event that, with the giving of notice or the lapse of time or
both, would constitute an Event of Default under the Loan Agreement, or
Torchmark shall be in default with respect to its payment or other obligations
under the Guarantee. Torchmark will also covenant (i) to maintain direct or
indirect 100% ownership of the Common Securities and any other securities of
Torchmark Capital other than the Preferred Securities; (ii) to cause at least
21% of the total value (initially measured by stockholders' equity determined
in accordance with
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generally accepted accounting principles) of Torchmark Capital and at least 21%
of all interests in the capital, income, gain, loss, deduction and credit of
Torchmark Capital to be represented by Common Securities, unless the Code or
the regulations or interpretations thereunder permit a lower percentage; (iii)
not to voluntarily dissolve, wind up or liquidate Torchmark Capital; (iv) to
remain the Managing Member of Torchmark Capital and to timely perform all of
its duties as Managing Member (including the duty to declare and pay dividends
on the Series A Preferred Securities as described in "Description of Series A
Preferred Securities--Dividends"); provided, that any permitted successor of
Torchmark under the Loan Agreement may succeed to Torchmark's duties as
Managing Member; and (v) to use its reasonable efforts to cause Torchmark
Capital to remain a limited liability company and otherwise continue to be
treated as a partnership for United States federal income tax purposes.
Torchmark Capital may not waive compliance or waive any default in compliance
by Torchmark of any covenant or other term in the Loan Agreement without the
approval of the same percentage of Series A Preferred Securityholders, obtained
in the same manner, as would be required for an amendment of the Loan Agreement
to the same effect, as set forth below under "Miscellaneous."
EVENTS OF DEFAULT
If one or more of the following events (each an "Event of Default") shall
occur and be continuing:
(a) default in the payment of interest on the Loans when due for 10 days
(whether by virtue of the provisions described above under "--
Subordination" or otherwise); provided that a valid extension of the
interest payment period by Torchmark shall not constitute a default in the
payment of interest for this purpose (see "--Interest");
(b) default in the payment of principal on the Loans when due (whether by
virtue of the provisions described above under "--Subordination" or
otherwise);
(c) the dissolution or winding up or liquidation of Torchmark Capital;
(d) the bankruptcy, insolvency or liquidation of Torchmark; or
(e) breach by Torchmark of any of its covenants under the Loan Agreement
continued for 30 days after notice to Torchmark from the holders of 25% of
the outstanding Series A Preferred Securities;
then Torchmark Capital will have the right to declare the principal of and the
interest on the Loans (including any interest subject to an extension election)
and all other amounts payable under the Loan Agreement to be forthwith due and
payable and to enforce its other rights as a creditor with respect to the
Loans. Under the terms of the Series A Preferred Securities, the holders of
outstanding Series A Preferred Securities will have the rights referred to
under "Description of Series A Preferred Securities--Voting Rights", including
the right to appoint a trustee, which trustee will be authorized to exercise
Torchmark Capital's right to accelerate the principal amount of the Loans and
to enforce Torchmark Capital's other creditor rights under the Loans, and
Torchmark agrees to cooperate with such trustee; provided, that no holder of
Series A Preferred Securities shall be entitled to institute any proceeding,
judicial or otherwise, under the Loan Agreements unless such proceeding has
been brought by or with the consent of the holders of at least 25% of the
outstanding Series A Preferred Securities; and provided, further, that
notwithstanding the immediately preceding proviso, the holder of any Series A
Preferred Securities shall have the right to institute suit for the enforcement
of any payment of principal or interest on the Loans.
ENFORCEMENT
Torchmark agrees in the Loan Agreement that its obligations under the Loan
Agreement are for the benefit of the holders of Series A Preferred Securities.
The holders, or a trustee appointed by and acting on behalf of the holders, may
enforce Torchmark's obligations under the Loan Agreements directly against
Torchmark as a third party beneficiary of Torchmark's obligations thereunder
without first proceeding against Torchmark Capital. However, except in the
event of a payment default as described in the next
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sentence, no holder of Series A Preferred Securities is entitled to institute
any proceedings under the Loan Agreements to enforce the covenants therein
unless such proceeding has been brought by or with the consent of the holders
of at least 25% of the outstanding Series A Preferred Securities.
Notwithstanding the immediately preceding sentence, the holder of any Series A
Preferred Securities shall have the right to institute suit for the enforcement
of any payment of principal or interest on the Loans.
The holder's claims under the Loan Agreement will rank subordinate and junior
in right of payment to all Senior Indebtedness of Torchmark as described under
"Subordination." Upon payment of such claims, any trustee appointed as
described above would be authorized to declare and cause Torchmark Capital to
pay dividends on the Series A Preferred Securities as described above under
"Description of the Series A Preferred Securities--Voting."
MISCELLANEOUS
Torchmark will have the right at all times to assign any of its rights or
obligations under the Loan Agreement to a direct or indirect wholly owned
subsidiary of Torchmark; provided that, in the event of any such assignment,
Torchmark will remain jointly and severally liable for all such obligations.
Torchmark Capital may not assign any of its rights under the Loan Agreement
without the prior written consent of Torchmark. Subject to the foregoing, the
Loan Agreement will be binding upon and inure to the benefit of Torchmark and
Torchmark Capital and their respective successors and assigns. The Loan
Agreement provides that it may not otherwise be assigned by Torchmark or
Torchmark Capital.
The Loan Agreement will provide that Torchmark may merge with or into another
entity, or permit another entity to merge with or into it, and may sell,
transfer or lease all or substantially all of its assets to another entity if
(i) at such time no Event of Default under the Loan Agreement has occurred and
is continuing, or would occur as a result of such merger, sale, transfer or
lease, and (ii) Torchmark is the survivor of such merger, or the survivor of
such merger or entity to which Torchmark's assets are sold, transferred or
leased is an entity organized under the laws of the United States or any state
thereof, assumes all of Torchmark's obligations under the Loan Agreement and
becomes the Managing Member.
The Loan Agreement will be governed by and construed in accordance with the
laws of the State of New York.
The Loan Agreement may be amended by mutual consent of the parties in the
manner the parties shall agree; provided that, so long as any of the Series A
Preferred Securities remain outstanding, no such amendment shall be made that
adversely affects the holders of Series A Preferred Securities, no termination
of the Loan Agreement shall occur and no Event of Default or compliance with
any covenant under the Loan Agreement may be waived by Torchmark Capital,
without the prior consent of at least 66 2/3% of the holders of the Series A
Preferred Securities, in writing or at a duly constituted meeting of such
holders.
CERTAIN UNITED STATES INCOME TAX CONSEQUENCES
This section is a summary of certain United States federal income tax
considerations that may be relevant to initial purchasers of Series A Preferred
Securities and represents the opinion of Hughes & Luce, L.L.P., counsel to
Torchmark and Torchmark Capital, insofar as it relates to matters of United
States federal income tax law. This discussion deals only with the federal
income tax considerations to initial purchasers who acquire the Series A
Preferred Securities at the original offering price. This discussion is based
upon current provisions of the Internal Revenue Code of 1986, as amended
("Code"), existing and proposed regulations thereunder and current
administrative and court decisions, all of which are subject to change
(possibly on a retroactive basis). Subsequent changes may cause the tax
consequences to vary substantially from the consequences described below.
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No attempt has been made in the following discussion to comment on all
federal income tax matters affecting purchasers of Series A Preferred
Securities. Moreover, the discussion focuses on holders of Series A Preferred
Securities who are individual citizens or residents of the United States and
has only limited application to foreign or domestic corporations (including,
particularly, regulated investment companies and insurance companies), estates,
trusts or non-resident aliens. ACCORDINGLY, EACH PROSPECTIVE PURCHASER OF
SERIES A PREFERRED SECURITIES SHOULD CONSULT HIS OWN TAX ADVISOR IN ANALYSING
THE FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF THE PURCHASE,
OWNERSHIP OR DISPOSITION OF SERIES A PREFERRED SECURITIES.
INCOME FROM SERIES A PREFERRED SECURITIES
In the opinion of Hughes & Luce, L.L.P., Torchmark Capital will be treated as
a partnership for federal income tax purposes. Accordingly, each Securityholder
will be required to include in gross income his distributive share of Torchmark
Capital's income. Such income generally will not exceed dividends received on
the Series A Preferred Securities, except in limited circumstances as described
below under "Potential Extension of Interest Payment Period." No portion of
such income will be eligible for the dividends received deduction.
DISPOSITION OF SERIES A PREFERRED SECURITIES
Gain or loss will be recognized on the redemption, sale or other disposition
of Series A Preferred Securities equal to the difference between the amount
realized and the Securityholder's adjusted tax basis for the Series A Preferred
Securities sold. Gain or loss recognized by a Securityholder on the sale or
exchange of a Series A Preferred Security held for more than one year will
generally be taxable as long-term capital gain or loss.
TORCHMARK CAPITAL INFORMATION RETURNS AND AUDIT PROCEDURES
Torchmark, as the Managing Member of Torchmark Capital, will furnish each
Securityholder with a Schedule K-1 each year setting forth such
Securityholder's allocable share of income for the prior calendar year.
Torchmark is required to furnish such K-1's as soon as practicable following
the end of the year, but in any event on or prior to March 31.
Any person who holds Series A Preferred Securities as a nominee for another
person is required to furnish to Torchmark Capital (a) the name, address, and
taxpayer identification number of the beneficial owner and the nominee; (b)
information as to whether the beneficial owner is (i) a person that is not a
United States person; (ii) a foreign government, an international organization,
or any wholly owned agency or instrumentality of either of the foregoing; or
(iii) a tax-exempt entity; (c) the amount and description of Series A Preferred
Securities held, acquired or transferred for the beneficial owner; and (d)
certain information including the dates of acquisitions and transfers, methods
of acquisitions and transfers and the costs thereof, as well as the amount of
net proceeds from sales. Brokers and financial institutions are required to
furnish additional information, including whether they are United States
persons and certain information on Series A Preferred Securities they acquire,
hold or transfer for their own accounts. A penalty of $50 per failure is
imposed by the Code for failure to report such information to Torchmark
Capital, up to a maximum of $100,000 per calendar year for all failures.
POTENTIAL EXTENSION OF INTEREST PAYMENT PERIOD
Under the terms of the Loans, Torchmark will be permitted to extend the
interest payment period up to 60 months. In the event Torchmark exercises this
right, Torchmark may not (among other things) declare dividends on its capital
stock (other than a declaration of a dividend consisting of common or preferred
stock purchase rights under a stockholder rights plan). Therefore, the
extension of an interest payment is, in the
S-26
<PAGE>
view of Torchmark, remote. In the event that the interest payment period is
extended, Torchmark Capital will continue to accrue income, equal to the amount
of the interest payment due at the end of the extended interest payment period,
over the length of the extended interest payment period.
Accrued income will be allocated, but not distributed, to holders of record
on the Business Day preceding the last day of each calendar month. As a result,
holders of record during an extended interest payment period will include
interest in taxable gross income in advance of the receipt of cash, and any
such holders who dispose of Series A Preferred Securities prior to the record
date for the payment of dividends following such extended interest payment
period will include interest in gross income but will not receive any cash
related thereto. The tax basis of a Series A Preferred Security will be
increased by the amount of any interest that is included in income without a
receipt of cash, and will be decreased again when and if such cash is
subsequently received from Torchmark Capital.
UNITED STATES ALIEN HOLDERS
For purposes of this discussion, a "United States Alien Holder" is any holder
who or which is (i) a nonresident alien individual or (ii) a foreign
corporation, partnership, or estate or trust, in either case not subject to
United States federal income tax on a net income basis in respect of a Series A
Preferred Security.
Under present United States federal income tax law, subject to the discussion
below with respect to backup withholding:
(i) payments by Torchmark Capital or any of its paying agents to any
holder of a Series A Preferred Securities who or which is a United States
Alien Holder will not be subject to United States federal income tax
withholding tax; provided that (a) the beneficial owner of a Series A
Preferred Security does not actually or constructively own 10% or more of
the total combined voting power of all classes of stock of Torchmark
entitled to vote; (b) the beneficial owner of the Series A Preferred
Security is not a controlled foreign corporation that is related to
Torchmark through stock ownership; and (c) either (A) the beneficial owner
of the Series A Preferred Security certifies to Torchmark Capital or its
agent, under penalties of perjury, that it is a United States Alien Holder
and provides its name and address, or (B) the holder of the Series A
Preferred Security is a securities clearing organization, bank, or other
financial institution that holds customers' securities in the ordinary
course of its trade or business (a "financial institution"), and such
holder certifies to Torchmark Capital or its agent under penalties of
perjury that such statement has been received from the beneficial owner by
it or by a financial institution between it and the beneficial owner and
furnishes the payor with a copy thereof; and
(ii) a United States Alien Holder of a Series A Preferred Security will
not be subject to United States federal withholding tax on any gain
realized on the sale or exchange of a Series A Preferred Security unless
such holder is present in the United States for 183 days or more in the
taxable year of sale and either has a "tax home" in the United States or
certain other requirements are met.
BACKUP WITHHOLDING AND INFORMATION REPORTING
In general, information reporting requirements will apply to payments of the
proceeds of the sale of the Series A Preferred Securities within the United
States to noncorporate United States holders, and "backup withholding" at a
rate of 31% will apply to such payments if the United States holder fails to
provide an accurate taxpayer identification number.
Payments of the proceeds from the sale by a United States Alien Holder of
Series A Preferred Securities made to or through a foreign office of a broker
will not be subject to information reporting or backup withholding, except
that, if the broker is a United States person, a controlled foreign corporation
for United States tax purposes, or a foreign person 50% or more of whose gross
income is effectively connected with a United States trade or business for a
specified three-year period, information reporting may apply to such payments.
Payments of the proceeds from the sale of Series A Preferred Securities to or
through the United
S-27
<PAGE>
States office of a broker is subject to information reporting and backup
withholding unless the holder or beneficial owner certifies as to its non-
United States status or otherwise establishes an exemption from information
reporting and backup withholding.
UNDERWRITERS
Subject to the terms and conditions of the Underwriting Agreement, Torchmark
Capital has agreed to sell to each of the Underwriters named below, and each of
the Underwriters, for whom are acting as Representatives, has severally
agreed to purchase from Torchmark Capital the respective number of Series A
Preferred Securities set forth opposite its name below:
<TABLE>
<CAPTION>
NAME SERIES A PREFERRED SECURITIES
---- -----------------------------
<S> <C>
-------
Total.......................................
=======
</TABLE>
Under the terms and conditions of the Underwriting Agreement, the
Underwriters are committed to take and pay for all such Series A Preferred
Securities offered hereby, if any are taken.
The Underwriters propose to offer the Series A Preferred Securities in part
directly to the public at the initial public offering price set forth on the
cover page of this Prospectus Supplement, and in part to certain securities
dealers at such price less a concession of $. per Series A Preferred Security.
The Underwriters may allow, and such dealers may reallow, a concession not in
excess of $. per Series A Preferred Security to certain brokers and dealers.
After the Series A Preferred Securities are released for sale to the public,
the offering price and other selling terms may from time to time be varied by
the Representatives.
In view of the fact that the proceeds of the sale of the Series A Preferred
Securities will be lent to Torchmark, under the Underwriting Agreement
Torchmark has agreed to pay as compensation ("Underwriters' Compensation") for
the Underwriters services, an amount in New York Clearing House (next day)
funds of $. per Series A Preferred Security for the accounts of the several
Underwriters.
Certain of the Underwriters are customers of, engage in transactions with, or
have from time to time performed services for Torchmark and its subsidiaries
and associated companies in the ordinary course of business.
Prior to this offering, there has been no public market for the Series A
Preferred Securities. In order to meet one of the requirements for listing on
the New York Stock Exchange, the Underwriters will undertake to sell lots of
100 or more Series A Preferred Securities to a minimum of 400 beneficial
holders.
Torchmark Capital and Torchmark have agreed to indemnify the Underwriters
against certain liabilities under the Securities Act of 1933, as amended.
S-28
<PAGE>
LEGAL OPINIONS
The legal validity of the Series A Preferred Stock and the Backup
Undertakings, including the Guarantee and the Loan Agreement, will be passed
upon for Torchmark and Torchmark Capital by Hughes & Luce, L.L.P., Dallas,
Texas. Hughes & Luce, L.L.P. will also pass upon the United States federal
income tax matters as described under "Certain United States Income Tax
Consequences." Certain legal matters will be passed upon for the Underwriters
by Davis Polk & Wardwell, New York, New York. Hughes & Luce, L.L.P. may rely on
the opinion of Davis Polk & Wardwell as to matters of New York law.
S-29
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED IN THIS PRELIMINARY PROSPECTUS IS SUBJECT TO COMPLETION +
+OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN +
+FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT +
+BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THAT A FINAL +
+PROSPECTUS SUPPLEMENT IS DELIVERED. THIS PRELIMINARY PROSPECTUS SHALL NOT +
+CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL +
+THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, +
+SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION +
+UNDER THE SECURITIES LAWS OF ANY STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION DATED MAY 24, 1994
PROSPECTUS
$200,000,000
TORCHMARK CORPORATION
[LOGO OF TORCHMARK APPEARS HERE]
PREFERRED STOCK
TORCHMARK CAPITAL L.L.C. PREFERRED SECURITIES
GUARANTEED TO THE EXTENT SET FORTH HEREIN BY
TORCHMARK CORPORATION
-----------
Torchmark Corporation ("Torchmark") may offer at any time, or from time to
time, shares of preferred stock, par value $1.00 per share ("Preferred Stock"),
in one or more series, which may be represented by depositary shares evidenced
by depositary receipts ("Depositary Shares" and, together with the L.L.C.
Preferred Securities (as defined below) and the Backup Undertakings (as defined
below), the "Securities") or any combination of Securities, with an aggregate
initial public offering price not to exceed $200,000,000.
As part of the Securities, Torchmark Capital L.L.C. ("Torchmark Capital"), a
special purpose finance subsidiary of Torchmark, may also offer from time to
time its preferred limited liability company interests ("LLC Preferred
Securities"), in one or more series, at an aggregate initial public offering
price not to exceed $200,000,000 at the time of sale. In connection therewith,
Torchmark may offer backup undertakings ("Backup Undertakings") with respect to
the LLC Preferred Securities, as described herein under "Torchmark Capital
L.L.C." Any issue of LLC Preferred Securities and related Backup Undertakings
shall correspondingly reduce the amount of other Securities available for offer
and sale hereunder.
Torchmark and/or Torchmark Capital will offer the Securities to the public at
prices and on terms to be determined at or prior to the time of sale. Specific
terms of the Securities in respect of which this Prospectus is being delivered
will be set forth in an accompanying Prospectus Supplement ("Prospectus
Supplement"), together with the terms of the offering of the Securities, the
initial price thereof and the net proceeds from the sale thereof. The
Securities may be offered separately or together, in separate series, in
amounts, at prices and on terms to be determined at the time of sale and to be
set forth in Prospectus Supplements. The Securities may be sold for U.S.
dollars or one or more foreign or composite currencies and the distributions on
the Securities may likewise be payable in U.S. dollars or one or more foreign
or composite currencies.
The Prospectus Supplement will set forth the terms of the Securities,
including the designation, number of shares or fractional interests therein (or
if Depositary Shares are issued, the fraction of a share of Preferred Stock
represented by one Depositary Share), liquidation preference per share, initial
public offering price, distribution rate or method of calculation thereof,
dates on which distributions will be payable and dates from which distributions
will accrue, any redemption or sinking fund provisions, any terms of redemption
at the option of Torchmark or the holder, as well as any terms of the Backup
Undertakings and any listing on a national securities exchange and any other
terms in connection with the offering and sale of the Securities in respect of
which this Prospectus is being delivered.
Because Torchmark is a holding company, the rights of Torchmark to
participate in any distribution of assets of any subsidiary (and thus the
ability of holders of Securities to benefit from such distribution) are subject
to the prior claims of creditors of that subsidiary. Such claims would include
subsidiary indebtedness of approximately $13.6 million at March 31, 1994. See
"Description of Securities--General."
The Securities may be sold by Torchmark or Torchmark Capital to underwriters,
to or through dealers, acting as principals for their own account or acting as
agents, or directly to other purchasers. The Prospectus Supplement will set
forth the names of any underwriters or agents, the principal amounts or shares,
if any, to be purchased by underwriters, and the compensation, if any, of such
underwriters or agents. Torchmark may indemnify such underwriters, dealers and
agents against certain liabilities, including liabilities under the Securities
Act of 1933. See "Plan of Distribution."
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
-----------
This Prospectus may not be used to consummate sales of Securities unless
accompanied by a Prospectus Supplement.
May 24, 1994
<PAGE>
AVAILABLE INFORMATION
Torchmark is subject to the information requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, therefore, files
reports, proxy statements and other information with the Securities and
Exchange Commission (the "Commission"). Such reports, proxy statements and
other information can be inspected and copied at the public reference
facilities maintained by the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549; at its New York Regional Office, 7 World Trade Center, New York,
New York 10048; and at its Chicago Regional Office, Northwestern Atrium Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such
material can be obtained at prescribed rates, by writing to the Public
Reference Section of the Commission, 450 Fifth Street, N.W., Washington, D.C.
20549. Such material can also be inspected at the New York Stock Exchange, 20
Broad Street, New York, New York 10005 and The Stock Exchange, London EC2N 1HP,
England.
This Prospectus constitutes a part of a Registration Statement on Form S-3
(together with all amendments, supplements and exhibits thereto, the
"Registration Statement") filed jointly by Torchmark and Torchmark Capital with
the Commission under the Securities Act of 1933, as amended (the "Securities
Act"). This Prospectus omits certain of the information set forth in the
Registration Statement (in accordance with the rules and regulations of the
Commission), and reference is hereby made to the Registration Statement and
related exhibits for further information with respect to Torchmark, Torchmark
Capital and the Securities.
No separate financial statements of Torchmark Capital have been included
herein. Torchmark and Torchmark Capital do not consider that such financial
statements would be material to holders of any LLC Preferred Securities which
may be offered hereby because Torchmark Capital is a newly organized special
purpose subsidiary, has no operating history or independent operations, is not
engaged in and does not propose to engage in, any activity other than the
issuance of its shares and the lending of the proceeds thereof to Torchmark and
because Torchmark will issue a full and unconditional, joint and several
guarantee of any LLC Preferred Securities, as described in the accompanying
Prospectus Supplement. See "Torchmark Capital L.L.C." Torchmark Capital is a
limited liability company organized under the laws of the State of Delaware and
will be managed by Torchmark, which directly or indirectly beneficially owns
all of Torchmark Capital's common limited liability company interests, which
are non-transferable. Financial statements of Torchmark Capital will be made
available to the holders of LLC Preferred Securities annually as soon as
practicable after the end of Torchmark Capital's fiscal year.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents filed by Torchmark (file no. 1-8052) with the
Commission are incorporated herein by reference: (i) Annual Report on Form 10-K
for the fiscal year ended December 31, 1993 ("Form 10-K"), (ii) Quarterly
Report on Form 10-Q for the quarter ended March 31, 1994, (iii) Form 8-K dated
March 25, 1994, (iv) Form 10-Q/A dated as of May 24, 1994 and (v) Form 8-K
dated June 6, 1994.
All reports and other documents subsequently filed by Torchmark and Torchmark
Capital pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after
the date of this Prospectus and prior to the termination of this offering shall
be deemed to be incorporated by reference herein and to be a part hereof from
the date of filing of such reports and documents. Any statement set forth
herein or in a document, all or a portion of which is incorporated or deemed to
be incorporated by reference herein, will be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement set
forth herein or in a subsequently filed document deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus. To the extent that any
proxy statement is incorporated by reference herein, such incorporation shall
not include any information contained in such proxy statement that is not,
pursuant to the Commission's rules, deemed to be "filed" with the Commission or
subject to the liabilities of Section 18 of the Exchange Act.
2
<PAGE>
Torchmark will furnish, without charge, to each person to whom a Prospectus
and Prospectus Supplement are delivered, upon written or oral request, a copy
of any or all of the foregoing documents incorporated herein by reference other
than exhibits to such documents (unless such exhibits are specifically
incorporated by reference therein). Requests for such documents should be
submitted in writing to the Investor Relations Department, Torchmark
Corporation, 2001 Third Avenue South, 16th Floor, Birmingham, Alabama 35233 or
by telephone at (205) 325-4243.
----------------
Unless otherwise indicated, currency amounts in this Prospectus and the
Prospectus Supplement are stated in United States dollars ("$" or "U.S.$").
3
<PAGE>
TORCHMARK
Torchmark, an insurance and diversified financial services holding company,
was incorporated in Delaware on November 29, 1979 as Liberty National Insurance
Holding Company. Through a plan of reorganization, which became effective on
December 30, 1980, it became the parent company for the businesses operated by
Liberty National Life Insurance Company ("Liberty") and Globe Life And Accident
Insurance Company ("Globe"). United American Insurance Company ("United
American"), Waddell & Reed, Inc. ("W&R") and United Investors Life Insurance
Company ("UILIC"), along with their respective subsidiaries, were acquired in
1981. The name Torchmark Corporation was adopted on July 1, 1982. Family
Service Life Insurance Company ("Famlico") was purchased in July, 1990.
Through its life insurance subsidiaries, including Liberty, Globe, United
American, Famlico and American Life and Accident Insurance Company, Torchmark
offers a portfolio of life and health insurance products. Through United
Investors Management Company ("UIMCO"), a wholly-owned subsidiary which owns
W&R, UILIC and Torch Energy Advisors Incorporated, Torchmark offers
institutional investment management services and individual financial planning
and products, including life insurance, annuities and mutual funds; provides
management services with respect to oil and gas production and development; and
engages in energy property acquisitions and dispositions, oil and gas product
marketing and well operations. Torchmark maintains a 27% ownership interest in
Vesta Insurance Group, Inc. ("Vesta"), a property and casualty insurance
holding company, which owns Vesta Fire Insurance Corporation (formerly Liberty
National Fire Insurance Company), offering industrial fire insurance,
collateral protection insurance, personal and commercial property and casualty
insurance and domestic reinsurance.
The principal executive office of Torchmark is located at 2001 Third Avenue
South, Birmingham, Alabama 35233, and its telephone number is (205) 325-4200.
Torchmark Capital is a special purpose finance subsidiary of Torchmark
organized as a limited liability company under the laws of the State of
Delaware. All of Torchmark Capital's common limited liability company interests
are directly or indirectly beneficially owned by Torchmark and are non-
transferable. Torchmark Capital has no board of directors or officers, and all
of its business and affairs are conducted by Torchmark, as the manager (the
"Manager") appointed in Torchmark Capital's Limited Liability Company
Agreement, as amended. Torchmark Capital exists solely for the purpose of
issuing its common and preferred limited liability company interests and
lending the proceeds thereof to Torchmark to finance Torchmark's or its
subsidiaries' business operations. The principal office of Torchmark Capital is
c/o Torchmark Corporation, 2001 Third Avenue South, Birmingham, Alabama 35233.
RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
The following table sets forth the ratio of Torchmark's (consolidated)
earnings to combined fixed charges and preferred stock dividends, for the
periods indicated:
<TABLE>
<CAPTION>
THREE
MONTHS
ENDED
YEAR ENDED DECEMBER 31, MARCH 31,
------------------------ ----
1989 1990 1991 1992 1993 1994
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Ratio of earnings to combined
fixed
charges and preferred stock
dividends:
Excluding interest credited on
deposit products.............. 6.1 6.3 6.2 7.1 6.8 6.4
Including interest credited on
deposit products.............. 4.0 3.8 3.6 3.8 3.9 3.8
</TABLE>
4
<PAGE>
For the purpose of computing the ratio of earnings to combined fixed charges
and preferred stock distributions, "earnings" consists of operating income
before income taxes and fixed charges. "Fixed charges" consists of interest
charges and the portion of rental expense deemed representative of the interest
factor. "Combined fixed charges and preferred stock distributions" represent
fixed charges (as described above) and the pre-tax income required to pay the
preferred stock distributions of Torchmark.
USE OF PROCEEDS
The net proceeds from the sale of Securities offered by Torchmark Capital
hereby will be lent to Torchmark. The net proceeds from the sale of the
Securities offered hereby by Torchmark, and the net proceeds of any loans from
Torchmark Capital, will be used by Torchmark for general corporate purposes,
which may include, without limitation, repayment of bank debt, the repurchase
of shares of Torchmark's Common Stock, and possible acquisitions, unless a
specific determination as to the use of the proceeds is otherwise described in
an accompanying Prospectus Supplement.
5
<PAGE>
SELECTED CONSOLIDATED FINANCIAL INFORMATION
The following selected consolidated financial information for five years
ended December 31, 1993 and for the three-month periods ended March 31, 1993
and 1994 should be read in conjunction with the more detailed information and
financial statements available as described under "Available Information" and
"Incorporation of Certain Information by Reference." The information for the
three-month periods ended March 31, 1993 and 1994 was derived from unaudited
financial statements. In the opinion of management, however, all adjustments
(consisting only of normal recurring accruals) necessary for a fair
presentation of such information have been included. Results of interim periods
are not necessarily indicative of results for an entire year.
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
YEAR ENDED DECEMBER 31, MARCH 31,
------------------------------------------------------------------ ------------------------
1989 1990 1991 1992 1993 1993 1994
----------- ----------- ----------- ----------- ----------- ---------- ----------
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
Premium and Policy
Charges:
Life premium............ $ 432,235 $ 487,991 $ 524,052 $ 544,467 $ 555,859 $ 137,426 $ 143,964
Health premium.......... 682,680 738,431 769,821 797,855 799,835 205,499 200,434
Other premium........... 69,521 64,830 71,940 111,640 137,216 28,515 3,750
Total................... 1,184,436 1,291,252 1,365,813 1,453,962 1,492,910 371,440 348,148
Net investment income.... 308,019 348,412 364,318 382,735 372,470 96,643 83,801
Financial services
revenue................. 108,255 108,561 114,326 133,462 137,422 34,008 36,544
Energy operations
revenue................. 22,239 32,218 54,841 74,014 106,013 21,414 17,303
Realized investment gains
(losses)................ 547 4,081 4,195 (948) 8,009 1,070 12,595
Total revenue............ 1,629,326 1,787,148 1,907,441 2,045,810 2,176,835 525,271 498,681
Net income............... 211,308 229,177 246,489 265,477 297,979/5/ 73,489/6/ 75,572
Preferred stock
distributions........... 7,667 6,898 6,116 3,453 3,289 823 804
Net income available to
common shareholders..... 203,641 222,279 240,373 262,024 294,690/5/ 72,666/6/ 74,768
Net income per common
share................... 2.59 2.85 3.13 3.58 4.01/5/ 0.99/6/ 1.03
Life insurance sales..... 11,024,758 11,257,778 11,222,307 11,067,341 12,240,244 3,025,314 3,459,981
Increase in life
insurance in force...... 842,605 694,733/1/ 1,280,412/2/ 2,195,544 3,060,638 934,430 1,155,665
Annualized life and
health premium issued:
Life.................... 119,629 129,233 133,741 131,726 128,433 31,551 34,423
Health.................. 232,336 273,290 216,962 224,905 176,028 53,807 35,373
Total................... 351,965 402,523 350,703 356,631 304,461 85,358 69,796
Increase (Decrease) in
annualized life and
health premium in force:
Life.................... 28,797 16,849/1/ 16,098/2/ 25,534 24,572 5,535 9,073
Health.................. 12,228 56,456 11,749 34,346 (9,106) 5,130 (10,799)
Total................... 41,025 73,305 27,847 59,880 15,466 10,665 (1,726)
Mutual fund collections.. 744,284 742,142 813,737 1,141,928 1,249,084 296,009 344,776
Per preferred share:
Cash dividends paid..... $ 7.80 $ 7.50 $ 7.66 $ 7.01 $ 7.00 $ 1.75 $ 2.88/7/
Per common share:
Cash dividends paid..... .83 .93 1.00 1.07 1.08 .27 .28
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
AT DECEMBER 31, MARCH 31,
----------------------------------- ---------------------
1991 1992 1993 1993 1994
----------- ----------- ----------- ---------- ----------
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
Cash and invested
assets/3/ ............. $ 4,605,446 $ 4,994,828 $ 5,550,931 $5,043,331 $5,381,509
Total assets............ 6,160,742 6,770,115 7,646,242 6,873,874 7,586,686
Short-term debt......... 11,499 276,819 107,108 160,105 136,900
Long-term debt.......... 667,125 497,867 792,335 512,920 797,276
Shareholders' equity.... 1,079,251 1,115,660 1,417,255 1,177,080 1,303,481
Per common share/4/.... 13.11 14.54 18.80 15.34 17.89
Life insurance in force. 56,110,751 58,306,295 61,366,933 59,240,725 62,522,598
Annualized life and
health premium in
force:
Life................... 562,550 588,084 612,656 593,619 621,729
Health................. 798,142 832,488 823,382 837,618 812,583
Total.................. 1,360,692 1,420,572 1,436,038 1,431,237 1,434,312
Assets under management
at
W&R.................... 10,692,000 12,144,000 14,455,000 12,592,000 14,285,000
</TABLE>
- --------
/1/ The increase in life insurance in force is adjusted by $337 million, and
the increase in life annualized premium in force is adjusted by $28.1
million, representing the business acquired in the Famlico acquisition.
/2/ The increase in life insurance in force is adjusted by $55 million, and
the increase in life annualized premium in force is adjusted by $2.7
million, representing the business acquired in the Sentinel American Life
Insurance Company acquisition.
/3/ Includes accrued investment income.
/4/ Computed after deduction of preferred shareholders' equity.
/5/ Includes the effects of adoption of Financial Accounting Standards 106 and
109 and a one-time addition to a non-operating expense charge relating to
self-insurance for directors' and officers' liability, guaranty fund
assessments and litigation expenses. On an after-tax basis, adoption of FAS
106 resulted in a charge of $7.5 million, adoption of FAS 109 resulted in an
addition to earnings of $25.9 million, and the addition to the non-operating
expense charge relating to self-insurance for directors' and officers'
liability, guaranty fund assessments and litigation expenses resulted in a
charge of $53.3 million. Also includes the effects of tax legislation
which increased the corporate tax rate from 34% to 35% resulting in a
charge to net earnings of $13.7 million, of which $9.4 million related to
prior years. Also includes an after-tax gain of $37.2 million from the
sale of 73% of Vesta.
/6/ Includes the effects of adoption of Financial Accounting Standards 106 and
109 and a one-time addition to a non-operating expense charge relating to
self-insurance for directors' and officers' liability, guaranty fund
assessments and litigation expenses. On an after-tax basis, adoption of FAS
106 resulted in a charge of $7.1 million, adoption of FAS 109 resulted in an
addition to earnings of $29.5 million, and the addition to the non-operating
expense charge relating to self-insurance for directors' and officers'
liability, guaranty fund assessments and litigation expenses resulted in a
charge of $22.8 million.
/7/ Includes the $1.13 per share paid at redemption representing the period
February 1, 1994 through March 31, 1994 in addition to the regular quarterly
dividend payment.
7
<PAGE>
DESCRIPTION OF TORCHMARK STOCK
AUTHORIZED AND OUTSTANDING CAPITAL STOCK
At March 31, 1994, the authorized capital stock of Torchmark was 165,000,000
shares, consisting of:
(a) 5,000,000 shares of Preferred Stock, par value $1.00 per share
("Preferred Stock"), of which no shares were outstanding; and
(b) 160,000,000 shares of Common Stock, par value $1.00 per share ("Common
Stock"), of which 72,869,130 shares were outstanding, and 68,145,410
shares were held in treasury.
Torchmark Corporation redeemed on March 31, 1994 the outstanding shares of
its Series A Preferred Stock at a redemption price of $100 per share plus
accrued and unpaid dividends to the redemption date, in the aggregate amount
of $1.13 per share. First Chicago Trust Company of New York served as
redemption agent and mailed redemption materials to holders of Series A
Preferred Shares. The $1.13 dividend was paid on March 31, 1994 to holders of
record as of March 17, 1994.
In general, the classes of authorized capital stock are afforded preferences
with respect to dividends and liquidation rights in the order listed above.
The Board of Directors of Torchmark (or a duly authorized committee thereof)
is empowered, without approval of the stockholders, to cause the Preferred
Stock to be issued in one or more series, with the numbers of shares of each
series and the rights, preferences and limitations of each series to be
determined by the Board of Directors of Torchmark (or a duly authorized
committee thereof). Among the specific matters that may be determined by the
Board of Directors of Torchmark (or a duly authorized committee thereof) are:
the annual rate of dividends; the redemption price, if any; the terms of a
sinking or purchase fund, if any; the amount payable in the event of any
voluntary liquidation, dissolution or winding up of the affairs of Torchmark;
conversion rights, if any; and voting powers, if any, in addition to those
described below. The descriptions set forth below do not purport to be
complete and are qualified in their entirety by reference to the Restated
Certificate of Incorporation of Torchmark, as amended (the "Restated
Certificate of Incorporation"). No holders of any class of Torchmark's capital
stock are entitled to preemptive rights.
GENERAL
Since Torchmark is a holding company, the rights of Torchmark to participate
in any distribution of assets of any subsidiary upon its liquidation or
reorganization or otherwise (and thus the ability of holders
of the Securities to benefit from such distribution) are subject to the prior
claims of creditors of that subsidiary, except to the extent that Torchmark
may itself be a creditor with recognized claims against that subsidiary.
Claims on Torchmark's subsidiaries by creditors may include claims of
policyholders, holders of indebtedness and claims of creditors in the ordinary
course of business. Such claims may increase or decrease, and additional
claims may be incurred in the future.
Statutes regulating insurance holding company systems impose various
limitations on investments in affiliates and may require prior approval of the
payment of certain dividends and other distributions by the regulated
insurance company to Torchmark or various of its affiliates. Since Torchmark's
primary source of income is the income of its insurance company subsidiaries
and its primary source of internally generated cash flow is the dividends from
such subsidiaries, Torchmark's ability to meet its obligations and pay the
dividends, redemption price, or liquidation payments on the Securities may be
affected by any such required approval.
8
<PAGE>
PREFERRED STOCK
The following is a general description of the terms of the Preferred Stock of
Torchmark. The particular terms of any series of Torchmark Preferred Stock
offered hereby ("Offered Preferred Stock") will be set forth in the Prospectus
Supplement relating thereto. The rights, preferences, privileges and
restrictions, including dividend rights, voting rights, terms of redemption and
liquidation preferences, of the Offered Preferred Stock of each series will be
fixed or designated pursuant to a certificate of designations adopted by the
Board of Directors of Torchmark or a duly authorized committee thereof. The
description of Preferred Stock set forth below and the description of the terms
of a particular series of Offered Second Preferred Stock that will be set forth
in a Prospectus Supplement do not purport to be complete and are qualified in
their entirety by reference to the certificate of designations relating to such
series.
In all respects, regardless of series, the Offered Preferred Stock shall rank
in preference to the Common Stock as to payment of dividends and as to
distribution of assets of Torchmark upon the liquidation, dissolution or
winding up of Torchmark. Upon issuance against full payment of the purchase
price therefor, shares of Offered Preferred Stock will be fully paid and
nonassessable.
Dividends. Holders of Offered Preferred Stock will be entitled to receive,
when, as and if declared by the Board of Directors of Torchmark out of any
funds legally available for that purpose, dividends in cash at such respective
rates, payable on such dates in each year and in respect of such dividend
periods, as stated in Torchmark's Restated Certificate of Incorporation or the
certificate of designations for such series of Offered Preferred Stock, before
any dividends may be declared or paid or set apart for payment upon the Common
Stock or any other class of stock ranking junior to such series of Offered
Preferred Stock. No dividend may be declared or paid on any series of Offered
Preferred Stock unless at the same time a dividend in like proportion to the
respectively designated dividend amounts shall be declared or paid on each
other series of Preferred Stock then issued and outstanding ranking prior to or
on a parity with such particular series with respect to the payment of
dividends. Dividends on Offered Preferred Stock may be either cumulative or
noncumulative.
Liquidation Preference. In the event of any liquidation, dissolution or
winding up of Torchmark, whether voluntary or involuntary, holders of Offered
Preferred Stock of each series (if any shares thereof are then issued and
outstanding) will be entitled to payment of the applicable liquidation price or
prices plus accrued dividends, out of the available assets of Torchmark, in
preference to the holders of Common Stock or any other class of stock ranking
junior to such series of Offered Preferred Stock upon liquidation, dissolution
or winding up.
Redemption and Conversion. Each series of Offered Preferred Stock will be
subject to redemption, if applicable, on such terms, at such prices and on such
dates as may be set forth in the applicable certificates of designations. The
Offered Preferred Stock will not be convertible.
Voting Rights. The holders of the Preferred Stock (including the Offered
Preferred Stock) have no voting rights except as specifically required by
statute and except for certain voting rights specifically provided in
Torchmark's Restated Certificate of Incorporation or the certificates of
designations creating the various series of such stock.
Voting rights of the Offered Preferred Stock will be noncumulative.
DESCRIPTION OF DEPOSITARY SHARES
GENERAL
Torchmark may, at its option, elect to offer fractional interests in the
Offered Preferred Stock, in which event Torchmark will offer depositary shares
("Depositary Shares"), each of which will represent a fraction (to be set forth
in the Prospectus Supplement relating to a particular series of Offered
Preferred Stock) of a share of a particular series of Offered Preferred Stock
as described below.
9
<PAGE>
The Offered Preferred Stock of any series represented by Depositary Shares
will be deposited under a deposit agreement (the "Deposit Agreement") between
Torchmark and a bank or trust company selected by Torchmark having its
principal office in the United States and having, alone or together with its
affiliates, a combined capital and surplus of at least $50,000,000 (the
"Depositary"). Subject to the terms of the Deposit Agreement, each registered
holder of a Depositary Share will be entitled, in proportion to the applicable
fraction of a share of Offered Preferred Stock represented by such Depositary
Share, to all the rights and preferences of the Offered Preferred Stock
represented thereby (including dividend, voting, redemption and liquidation
rights).
The Depositary Shares will be evidenced by depositary receipts ("Depositary
Receipts") issued pursuant to the Deposit Agreement. Depositary Receipts will
be distributed to those persons purchasing the fractional interests in Offered
Preferred Stock in accordance with the terms of the offering set forth in the
applicable Prospectus Supplement. A copy of the form of Deposit Agreement is
filed as an exhibit to the Registration Statement of which this Prospectus is a
part, and the following summary is qualified in it entirety by reference to
such exhibit.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Depositary will distribute all dividends or other cash distributions
received in respect of the Offered Preferred Stock to the record holders of
Depositary Shares relating to such Offered Preferred Stock in proportion to the
number of such Depositary Shares owned by such holders.
In the event of a distribution other than in cash, the Depositary will
distribute property received by it to the record holders of Depositary Shares
entitled thereto in proportion to the number of such Depositary Shares owned by
such holders, unless the Depositary determines that such distribution cannot be
made proportionately among such holders or that it is not feasible to make such
distribution, in which case the Depositary may, with the approval of Torchmark,
sell such securities or property and distribute the net proceeds from such sale
to such holders or adopt such other method as it deems equitable and
practicable for effecting such distribution.
WITHDRAWAL OF THE OFFERED PREFERRED STOCK
Upon surrender of the Depositary Receipts at the corporate trust office of
the Depositary (unless the related Offered Preferred Stock or Depositary Shares
have previously been called for redemption), and upon payment of the charges
provided in the Deposit Agreement and subject to the terms hereof, the holder
of the Depositary Shares evidenced thereby is entitled to delivery to such
office to or upon his order, of the number of whole shares of Offered Preferred
Stock and any money or other property represented by such Depositary Shares. If
the Depositary Receipts delivered by the holder evidence a number of Depositary
Shares in excess of the number of Depositary Shares representing the number of
whole shares of Offered Preferred Stock to be withdrawn, the Depositary will
deliver to such holder at the same time a new Depositary Receipt evidencing
such excess number of Depositary Shares. Holders of Offered Preferred Stock
thus withdrawn, and any subsequent holders of those shares, will not thereafter
be entitled to deposit such shares under the Deposit Agreement or to receive
Depositary Shares therefor.
REDEMPTION OF DEPOSITARY SHARES
Upon redemption of Offered Preferred Stock represented by Depositary Shares,
the Depositary will redeem, as of the same redemption date, the number of
Depositary Shares representing Offered Preferred Stock so redeemed, provided
Torchmark shall have paid in full to the Depositary the redemption price of the
Offered Preferred Stock to be redeemed plus an amount equal to any accrued and
unpaid dividends thereon to the date fixed for redemption. The redemption price
per Depositary Share will be equal to the applicable fraction of the redemption
price and any other amounts per share payable with respect to the Offered
Preferred Stock. If fewer than all the Depositary Shares are to be redeemed,
the Depositary Shares to be
10
<PAGE>
redeemed will be selected by the Depositary by lot or pro rata or by any other
equitable method, in each case as may be determined by Torchmark.
VOTING OF THE OFFERED PREFERRED STOCK
Upon receipt of notice of any meeting at which the holders of the Offered
Preferred Stock are entitled to vote, the Depositary will mail the information
contained in such notice of meeting to the record holders of the Depositary
Shares. Each record holder of such Depositary Shares on the record date (which
will be the same date as the record date for the Offered Preferred Stock) will
be entitled to instruct the Depositary as to the exercise of the voting rights
pertaining to the amount of Offered Preferred Stock represented by such
holder's Depositary Shares. The Depositary will endeavor, insofar as
practicable, to vote the number of shares of Offered Preferred Stock
represented by such Depositary Shares in accordance with such instructions, and
Torchmark will agree to take all reasonable action which may be deemed
necessary by the Depositary in order to enable the Depositary to do so. The
Depositary will abstain from voting Offered Preferred Stock (but, at its
discretion, not from appearing at any meeting with respect to such Offered
Preferred Stock) to the extent it does not receive specific instructions from
the holders of Depositary Shares representing Offered Preferred Stock.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares and any
provision of the Deposit Agreement may at any time be amended by agreement
between Torchmark and the Depositary. However, any amendment which materially
and adversely alters the rights of the holders of Depositary Shares will not be
effective unless such amendment has been approved by the holders of at least a
majority of the Depositary Shares then outstanding.
The Deposit Agreement may be terminated by Torchmark upon not less than 60
days' notice, whereupon the Depositary shall deliver or make available to each
holder of Depositary Receipts, upon surrender of the Depositary Receipts held
by such holder, such number of whole or fractional shares of Offered Preferred
Stock represented by such Depositary Receipts. The Deposit Agreement will
automatically terminate if (i) all outstanding Depositary Shares have been
redeemed, or (ii) there has been a final distribution in respect of the Offered
Preferred Stock in connection with any liquidation, dissolution or winding up
of Torchmark and such distribution has been made to the holders of Depositary
Receipts.
CHARGES OF DEPOSITARY
Torchmark will pay all transfer and other taxes and governmental charges
arising solely from the existence of the depositary arrangements. Torchmark
will pay the fees and expenses of the Depositary in connection with the
performance of its duties under the Deposit Agreement, to the extent specified
in the Deposit Agreement. Holders of Depositary Receipts will pay transfer and
other taxes and governmental charges.
MISCELLANEOUS
Torchmark will forward to holders of Depositary Shares any reports and
communications that it sends to holders of Offered Preferred Stock. Neither the
Depositary nor Torchmark will be liable if it is prevented from or delayed in,
by law or any circumstances beyond its control, performing its obligations
under the Deposit Agreement. The obligations of Torchmark and the Depositary
under the Deposit Agreement will be limited to performing their duties
thereunder without negligence or willful misconduct, and Torchmark and the
Depositary will not be obligated to prosecute or defend any legal proceeding in
respect of any Depositary Shares or any Offered Preferred Stock unless
satisfactory indemnity is furnished. Torchmark and the Depositary may rely on
advice of counsel or accountants, on information provided by holders of
Depositary Shares or other persons believed to be authorized or competent and
on documents believed to be genuine.
11
<PAGE>
In the event the Depositary shall receive conflicting claims, requests or
instructions from any holders of Depositary Receipts, on the one hand, and
Torchmark, on the other hand, the Depositary shall be entitled to act on such
claims, requests or instructions received from Torchmark.
RESIGNATION AND REMOVAL OF DEPOSITARY
The Depositary may resign at any time by delivering to Torchmark notice of
its election to do so, and Torchmark may at any time remove the Depositary, any
such resignation or removal to take effect upon the appointment of a successor
Depositary and its acceptance of such appointment. Such successor Depositary
must be appointed within 60 days after delivery of the notice of resignation or
removal and must be a bank or trust company having its principal office in the
United States and having, alone or together with its affiliates, a combined
capital and surplus of at least $50,000,000.
TORCHMARK CAPITAL L.L.C.
GENERAL
Torchmark Capital, a subsidiary of Torchmark, is a limited liability company
organized under the laws of the State of Delaware. All of its common limited
liability company interests are beneficially owned by Torchmark or its
affiliates and are non-transferable. Torchmark Capital's principal offices are
located c/o the Manager at the address set forth under "Torchmark." Torchmark
Capital has no board of directors, and all of its business and affairs are
conducted by Torchmark, as the Manager appointed in Torchmark Capital's Limited
Liability Company Agreement, as amended. The location of the principal
executive offices of the Manager is set forth above under "Torchmark."
Torchmark Capital exists solely for the purpose of issuing its common and
preferred limited liability company interests and lending the net proceeds
thereof to Torchmark.
LLC PREFERRED SECURITIES
Torchmark Capital may from time to time issue LLC Preferred Securities, in
one or more series, having terms described in the Prospectus Supplement
relating thereto, including any terms relating to the redemption of the LLC
Preferred Securities upon the occurrence of certain events described in the
Prospectus Supplement. Under Torchmark Capital's Limited Liability Company
Agreement, as amended, the Manager may establish one or more classes or series
of LLC Preferred Securities, having such terms, including dividends,
redemption, voting, liquidation rights and such other preferred or other
special rights or such restrictions, as the Manager may determine, to be set
forth in a Prospectus Supplement. All LLC Preferred Securities of Torchmark
Capital offered by any Prospectus Supplement will be guaranteed by Torchmark to
the limited extent set forth below under "Guarantee" and in the Prospectus
Supplement and may also be entitled to the benefits of certain undertakings of
Torchmark as described below under "Backup Undertakings" and in the Prospectus
Supplement. Any special federal income tax, accounting and other considerations
applicable to any offering of LLC Preferred Securities and related Backup
Undertakings will be described in the Prospectus Supplement relating thereto.
GUARANTEE
Torchmark will irrevocably and unconditionally agree (the "Guarantee"), to
the extent set forth in a Payment and Guarantee Agreement, to pay in full, to
the holders of LLC Preferred Securities of any class or series, the Guarantee
Payments (as defined below), as and when due, regardless of any defense, right
of setoff or counterclaim which Torchmark Capital may have or assert. The
Guarantee will constitute a guarantee of payment and not of collection, and may
be enforced by holders of LLC Preferred Securities directly against Torchmark.
The following payments to the extent not paid by Torchmark Capital (the
"Guarantee Payments") will be subject to the Guarantee (without duplication):
(i) any arrears and accruals of unpaid dividends which have theretofore been
declared on the Preferred Shares of such class or series out of moneys legally
available therefor; (ii) the redemption price including all arrears and
accruals of unpaid dividends
12
<PAGE>
payable, out of moneys legally available therefor with respect to any LLC
Preferred Securities of such class or series called for redemption; and (iii)
upon a liquidation of Torchmark Capital, the lesser of (a) the liquidation
preference and all arrears and accruals of unpaid dividends (whether or not
declared) on the LLC Preferred Securities of such class or series to the date
of payment or (b) the amount of assets of Torchmark Capital legally available
for distribution in such liquidation. In addition, the Prospectus Supplement
relating to a class or series of LLC Preferred Securities will describe the
rank of the Guarantee and any additional covenants or other terms of the
Guarantee of Torchmark with respect to such class or series.
BACKUP UNDERTAKINGS
In connection with any class or series of LLC Preferred Securities, Torchmark
may enter into additional arrangements with Torchmark Capital, including
intercompany loan agreements and amendments to Torchmark Capital's Limited
Liability Company Agreement and Certificate of Formation, that operate directly
or indirectly for the benefit of holders of the LLC Preferred Securities. The
Guarantee described above under "Guarantee," the agreement described in the
previous paragraph and any such other arrangements are herein collectively
referred to as "Backup Undertakings" of Torchmark and will be described in the
Prospectus Supplement relating to any class or series of LLC Preferred
Securities to which they apply.
PLAN OF DISTRIBUTION
GENERAL
Torchmark or Torchmark Capital may sell the Securities to or through
underwriters or a group of underwriters, directly to other purchasers, or
through dealers or agents. The distribution of the Securities may be effected
from time to time in one or more transactions at a fixed price or prices, which
may be changed, at market prices prevailing at the time of sale, at prices
related to such prevailing market prices or at negotiated prices. Each
Prospectus Supplement will describe the method of distribution, and time and
place of delivery, of the offered Securities. Torchmark or Torchmark Capital
also may, from time to time, authorize dealers, acting as Torchmark's or
Torchmark Capital's agents, to solicit offers to purchase the offered
Securities upon the terms and conditions set forth in any Prospectus
Supplement.
In connection with the sale of Securities, underwriters, dealers or agents
may receive compensation from Torchmark or Torchmark Capital or from purchasers
of Securities for whom they may act as agents, in the form of discounts,
concessions or commissions. Underwriters, dealers and agents that participate
in the distribution of Securities may be deemed to be "underwriters," and any
discounts or commissions received by them and any profit on the resale of
Securities by them may be deemed to be underwriting discounts and commissions,
under the Securities Act. Any such underwriter, dealer or agent will be
identified, and any such compensation will be described, in the Prospectus
Supplement relating to the offered Securities.
Under agreements which may be entered into by Torchmark and/or Torchmark
Capital, underwriters, dealers and agents that participate in the distribution
of Securities may be entitled to indemnification by Torchmark and/or Torchmark
Capital against certain liabilities, including liabilities under the Securities
Act, or to contribution with respect to payments which such underwriters,
dealers and agents may be required to make in connection therewith.
Underwriters, dealers and agents may be customers of, engage in transactions
with, or perform services for Torchmark and/or Torchmark Capital in the
ordinary course of business.
Unless otherwise indicated in a Prospectus Supplement, each issuance of
Securities will constitute a new issue of securities with no established
trading market. The Securities may or may not be listed on a national
securities exchange. In the event that Securities offered hereunder are not
listed on a national securities exchange, certain broker-dealers may make a
market in the Securities, but will not be obligated to do so and may
discontinue any market making at any time without notice. No assurance can be
given that any broker-dealer will make a market in the Securities or as to the
liquidity of the trading market for such Securities.
13
<PAGE>
DELAYED DELIVERY ARRANGEMENTS
If so indicated in the Prospectus Supplement relating to offered Securities,
Torchmark and/or Torchmark Capital will authorize dealers or other persons
acting as Torchmark's or Torchmark Capital's agents to solicit offers by
certain institutions to purchase Securities from Torchmark and/or Torchmark
Capital pursuant to contracts providing for payment and delivery on a future
date. Institutions with which such contracts may be made include commercial and
savings banks, insurance companies, pension funds, investment companies,
educational and charitable institutions and others, but in all cases such
institutions must be approved by Torchmark and/or Torchmark Capital. The
obligations of any purchaser under any such contract will be subject to the
condition that the purchase of Securities shall not at the time of delivery be
prohibited under the laws of the jurisdiction to which such purchaser is
subject. The dealers and such other agents will not have any responsibility in
respect of the validity or performance of such contracts.
LEGAL OPINIONS
The legal validity of the Securities will be passed upon for Torchmark and
Torchmark Capital by Hughes & Luce, L.L.P., Dallas, Texas. Hughes & Luce L.L.P.
will also pass upon United States Federal income tax matters, as described in a
Prospectus Supplement relating to the Securities to be offered. Certain legal
matters will be passed upon for the Underwriters by Davis Polk & Wardwell, New
York, New York. In connection with its opinions, Hughes & Luce, L.L.P. will
rely on the opinion of Davis Polk & Wardwell as to matters of New York law.
EXPERTS
The financial statements and schedules of Torchmark Corporation as of
December 31, 1993 and 1992 and for each of the years in the three-year period
ended December 31, 1993, incorporated by reference herein have been
incorporated by reference in reliance upon the report of KPMG Peat Marwick,
independent certified public accountants, incorporated by reference herein, and
upon the authority of said firm as experts in accounting and auditing.
14
<PAGE>
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NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMA-
TION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS OR ANY PRO-
SPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. NEITHER THIS PROSPECTUS NOR
ANY PROSPECTUS SUPPLEMENT CONSTITUTES AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY
PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION. NEITHER
THE DELIVERY OF THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT NOR ANY SALE MADE
HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE FACTS SET FORTH IN THIS PROSPECTUS OR IN
ANY PROSPECTUS SUPPLEMENT OR IN THE AFFAIRS OF THE COMPANY SINCE THE DATE
HEREOF OR THEREOF.
---------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information... 2
Incorporation of Certain
Information by Refer-
ence................... 2
Torchmark............... 4
Ratio of Earnings to
Combined Fixed Charges
and Preferred Stock
Dividends.............. 4
Use of Proceeds......... 5
Selected Consolidated
Financial Information.. 6
Description of Torchmark
Stock.................. 8
Description of Deposi-
tary Shares............ 9
Torchmark Capital
L.L.C. ................ 12
Plan of Distribution.... 13
Legal Opinions.......... 14
Experts................. 14
</TABLE>
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[LOGO OF TORCHMARK CORPORATION APPEARS HERE]
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<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
<S> <C>
Filing fee--Securities and Exchange Commission................. $ 68,966
*Printing and engraving expenses................................ 40,000
*Legal fees and expenses........................................ 125,000
*Accounting fees and expenses................................... 5,000
*Blue Sky fees and expenses..................................... 20,000
*Rating agency fees............................................. 120,000
Transfer Agent and Registrar's fees and expenses............... 5,000
*Miscellaneous.................................................. 16,034
--------
*Total...................................................... $375,000
========
</TABLE>
- --------
* Estimated for the purpose of this Registration Statement.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 1 of Article Ninth of the Restated Certificate of Incorporation of
Torchmark provides that a director will not be personally liable to Torchmark
or its stockholders for monetary damages for breach of fiduciary duty as a
director except for liability (a) for any breach of the duty of loyalty to the
Registrant or its stockholders, (b) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (c) for
paying a distribution or approving a stock repurchase in violation of the
Delaware General Corporation Law (the "Act"), or (d) for any transaction from
which the director derived an improper personal benefit.
Section 2(a) of Article Ninth provides that each person who was or is made a
party or is threatened to be made a party to, or is involved in, specific
actions, suits or proceedings by reason of the fact that he or she is or was a
director or officer of Torchmark (or is or was serving at the request of
Torchmark as a director, officer, employee or agent for another entity) while
serving in such capacity will be indemnified and held harmless by Torchmark, to
the full extent authorized by the Act, as in effect (or, to the extent
indemnification is broadened, as it may be amended) against all expense,
liability or loss (including attorneys' fees, judgments, fines, ERISA excise
taxes or penalties and amounts paid or to be paid in settlement) reasonably
incurred by such person in connection therewith. With respect to derivative
actions, indemnification only extends to expenses (including attorneys' fees)
incurred in connection with defense or settlement of such an action and the Act
requires court approval before there can be any indemnification where the
person seeking indemnification has been found liable to Torchmark. Rights
conferred hereby are contract rights and include the right to be paid by
Torchmark the expenses incurred in defending the proceedings specified above,
in advance of their final disposition; provided that, if the Act so requires,
such payment will only be made upon delivery to Torchmark by the indemnified
party of an undertaking to repay all amounts advanced if it is ultimately
determined that the person receiving such payments is not entitled to be
indemnified under such Section 2(a) or otherwise. Torchmark may, by action of
its Board of Directors, provide indemnification to its employees and agents
with the same scope and effect as the foregoing indemnification of directors
and officers.
Section 2(b) of Article Ninth provides that persons indemnified under Section
2(a) may bring suit against Torchmark to recover unpaid amounts claimed
thereunder, and that if such suit is successful, the expense of bringing such
suit will be reimbursed by Torchmark. While it is a defense to such a suit that
the person claiming indemnification has not met the applicable standards of
conduct making indemnification permissible under the Act, the burden of proving
the defense is on Torchmark and neither the failure of Torchmark's Board of
Directors, independent legal counsel or the shareholders to have made a
determination that
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<PAGE>
indemnification is proper, nor an actual determination that the claimant has
not met the applicable standard of conduct, is a defense to the action or
creates a presumption that the claimant has not met the applicable standard of
conduct.
The right to indemnification and the payment of expenses incurred in
defending a proceeding in advance of its final disposition conferred in
paragraphs 2(a) and 2(b) of Article Ninth is not exclusive of any other right
which any person may have or acquire under any statute, provision of the
Certificate of Incorporation or By-Laws, or otherwise. Torchmark may maintain
insurance, at its expense, to protect itself and any directors, officers,
employees or agents of Torchmark or other entity against any expense, liability
or loss, whether or not Torchmark would have the power to indemnify such
persons against such expense, liability or loss under the Act.
ITEM 16. EXHIBITS.
1.1* --Form of proposed Underwriting Agreement Standard Provisions
(Preferred Stock)
--Limited Liability Agreement of Torchmark Capital
3.1*
3.2* --Certificate of Formation of Torchmark Capital
--Form of Amended and Restated Limited Liability Company
Agreement of Torchmark Capital
3.3*
5.1* --Opinion of Hughes & Luce, L.L.P. as to legality of
securities being registered
--Opinion of Hughes & Luce, L.L.P. with respect to tax matters
5.2*
--Statement re computation of ratio of earnings to combined
12* fixed charges and preferred stock dividends
24.1* --Consent of Hughes & Luce, L.L.P. (contained in Exhibit 5.1
hereto)
24.2 --Consent of KPMG Peat Marwick
25* --Powers of Attorney
--Form of Payment and Guarantee Agreement by Torchmark for the
99.1* benefit of the holders of preferred securities of Torchmark
Capital
--Form of Loan Agreement between Torchmark and Torchmark
99.2* Capital
- --------
* Previously filed.
Exhibits not referred to have been omitted as inapplicable or not required.
ITEM 17. UNDERTAKINGS.
The undersigned Registrants hereby undertake:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement;
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising after
the effective date of this Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in this Registration Statement, and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or
any material change to such information in this Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
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<PAGE>
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered hereby which remain unsold at the
termination of the offering.
The undersigned Registrants hereby undertake that, for purposes of
determining any liability under the Securities Act, each filing of the
Torchmark's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in the Registration Statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
Insofar as indemnification by the Registrants for liabilities arising under
the Securities Act may be permitted to directors, officers and controlling
persons of the Registrants pursuant to the provisions described under Item 15
above or otherwise, the Registrants have been advised that in the opinion of
the Commission such indemnification is against public policy as expressed in
the Securities Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
Registrants of expenses incurred or paid by a director, officer or controlling
person of the Registrants in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrants will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
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<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, TORCHMARK
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE
REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS AMENDMENT TO BE
SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY
OF BIRMINGHAM, STATE OF ALABAMA, ON JUNE 28, 1994.
Torchmark Corporation
By /s/ Keith A. Tucker
----------------------------------
KEITH A. TUCKER
VICE CHAIRMAN
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, TORCHMARK CAPITAL
L.L.C. CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF
THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS AMENDMENT TO
BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED THEREUNTO DULY AUTHORIZED, IN THE
CITY OF BIRMINGHAM, STATE OF ALABAMA, ON JUNE 28, 1994.
Torchmark Capital L.L.C.
By: Torchmark Corporation, as
Authorized Person
By: /s/ Keith A. Tucker
--------------------------------
KEITH A. TUCKER
VICE CHAIRMAN
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS AMENDMENT
HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE CAPACITIES INDICATED FOR
TORCHMARK AND THE AUTHORIZED PERSON ON JUNE 28, 1994.
SIGNATURES TITLE
---------- -----
* Chairman, Chief
- ------------------------------------- Executive Officer
(R. K. RICHEY) and Director
/s/ Keith A. Tucker
- ------------------------------------- Vice Chairman and
(KEITH A. TUCKER) Director (Principal
Financial Officer)
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<PAGE>
<TABLE>
<CAPTION>
SIGNATURES TITLE
---------- -----
<S> <C>
/s/ Spencer H. Stone Controller
- ------------------------------------
(SPENCER H. STONE)
Director
- ------------------------------------
(J. P. BRYAN)
* Director
- ------------------------------------
(JOSEPH M. FARLEY)
* Director
- ------------------------------------
(LOUIS T. HAGOPIAN)
* Director
- ------------------------------------
(C. B. HUDSON)
* Director
- ------------------------------------
(JOSEPH L. LANIER, JR.)
* Director
- ------------------------------------
(HAROLD T. MCCORMICK)
* Director
- ------------------------------------
(JOSEPH W. MORRIS)
* Director
- ------------------------------------
(GEORGE J. RECORDS)
* Director
- ------------------------------------
(YETTA G. SAMFORD, JR.)
*By: /s/ Keith A. Tucker
---------------------------
(KEITH A. TUCKER)
ATTORNEY-IN-FACT
</TABLE>
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<PAGE>
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
Torchmark Corporation:
We consent to the use of our reports incorporated herein by reference and to
the reference to our firm under the heading "Experts" in the prospectus.
KPMG Peat Marwick
Birmingham, Alabama
June 28, 1994
