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As filed with the Securities and Exchange Commission on , 1999.
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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TORCHMARK CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 63-0780404
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
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2001 Third Avenue South
Birmingham, Alabama 35233
(205) 325-4200
(Address, including zip code, and telephone number of registrant's principal
executive office)
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LARRY M. HUTCHISON, ESQ
Vice President and General Counsel
2001 Third Avenue South
Birmingham, AL 35233
(205) 325-4200
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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Copies to:
GREGORY S. CURRAN, ESQ. FRANCIS J. MORISON, ESQ.
CHRISTOPHER B. HARMON, ESQ. Davis, Polk & Wardwell
Maynard, Cooper & Gale, P.C. 450 Lexington Avenue
1901 Sixth Avenue North, Suite New York, New York 10017
2400 (212) 450-4800
Birmingham, Alabama 35203
(205) 254-1000
Approximate date of commencement of proposed sale of the securities to the
public: As soon as practicable after this Registration Statement has become
effective.
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 being offered only in connection with dividend or
interest reinvestment plans, please check the following box. [X]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
Proposed Maximum
Title of Each Class of Aggregate Proposed Maximum Amount of
Securities Amount to be Offering Price Aggregate Registration
to be Registered(1) Registered(1)(2) Per Unit(2)(3) Offering Price(2) Fee(4)
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<S> <C> <C> <C> <C>
Preferred Stock of
Torchmark Corporation..
Depositary Shares repre-
senting Preferred Stock
of Torchmark Corpora-
tion(5) ...............
Preferred Securities of
Torchmark Capital Trust
I and Torchmark Capital
Trust II ..............
Senior debt securities,
senior subordinated
debt securities, subor-
dinated debt securities
and junior subordinated
debt securities (col-
lectively, "Debt Secu-
rities") of Torchmark
Corporation ...........
Guarantee of Preferred
Securities of Torchmark
Capital Trust I and
Torchmark Capital Trust
II by Torchmark Corpo-
ration(6) .............
Total................... $300,000,000 100% $300,000,000 $83,400
</TABLE>
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(1) Such indeterminate number of shares of Preferred Stock and Depositary
Shares and such indeterminate principal amount of Debt Securities and such
indeterminate number of Preferred Securities of Torchmark Capital Trust I and
Torchmark Capital Trust II as may from time to time be issued at indeterminate
prices. Debt Securities may be issued and sold to Torchmark Capital Trusts I
and II, in which event such Debt Securities may later be distributed to the
holders of trust preferred securities upon a dissolution of Torchmark Capital
Trusts I and II and the distribution of the assets thereof.
(2) The aggregate public offering price of the securities registered hereby
will not exceed $300,000,000. Any securities registered hereunder may be sold
separately or as units with other securities registered hereunder.
(3) The proposed maximum offering price per unit (a) has been omitted
pursuant to Instruction II.D. of Form S-3 and (b) will be determined from time
to time by the Registrants in connection with the issuance of securities
registered hereunder.
(4) Calculated pursuant to Rule 457(o) of the rules and regulations under the
Securities Act of 1933.
(5) Such indeterminate number of Depositary Shares to be evidenced by
Depositary Receipts issued under a Deposit Agreement. If fractional interests
in shares of Preferred Stock are issued, Depositary Receipts will be
distributed for such fractional interests and the shares of Preferred Stock
will be issued to the depositary under the Deposit Agreement.
(6) Includes the rights of holders of the trust preferred securities and
certain back-up obligations of Torchmark Corporation as further described in
this Registration Statement. No separate consideration will be received for any
Guarantees or the back-up obligations.
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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 on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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<PAGE>
The information in this prospectus is not complete and may be changed. We
may not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an
offer to sell these securities, and we are not soliciting offers to buy these
securities in any state where the offer or sale is not permitted.
Prospectus
$300,000,000
[LOGO OF TORCHMARK TORCHMARK CAPITAL TRUST I
APPEARS HERE] TORCHMARK CAPITAL TRUST II
Preferred Stock, Depositary Shares Trust Preferred Securities Guaranteed by
and Debt Securities Torchmark Corporation
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TORCHMARK CORPORATION
. may sell preferred stock to the public;
. may sell depositary shares representing preferred stock to the public;
. may sell debt securities to the public; and
. will fully and unconditionally guarantee the payment by each trust of
any trust preferred securities based on its obligations under a
guarantee, a trust declaration and an indenture.
. our principal executive offices are located at 2001 Third Avenue South,
Birmingham, Alabama 35233, and our Telephone number is (205) 325-4200
THE TRUSTS
Torchmark Capital Trust I and Torchmark Capital Trust II may:
. sell trust preferred securities to the public;
. sell trust common securities to Torchmark;
. use the proceeds from these sales to buy an equal amount of debt
securities of Torchmark; and
. distribute the cash payments it receives on the debt securities it owns
to the holders of the trust preferred and trust common securities.
We urge you to read carefully this prospectus and the accompanying
prospectus supplement, which will describe the specific terms of the securities
being offered to you, before you make your investment decision.
Investing in the securities involves risks. See "Risk Factors" beginning on
page 3.
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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.
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This prospectus may not be used to sell securities unless accompanied by a
prospectus supplement.
, 1999
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TABLE OF CONTENTS
<TABLE>
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Page
----
<S> <C>
Risk Factors............................................................. 3
Forward-Looking Statements............................................... 6
Torchmark Corporation.................................................... 7
The Trusts............................................................... 7
Use of Proceeds.......................................................... 8
Ratio of Earnings from Continuing Operations to Combined Fixed Charges
and Preferred Stock Dividends........................................... 8
Description of Securities................................................ 9
Description of Capital Stock............................................. 9
Description of Depositary Shares......................................... 10
Description of the Trust Preferred Securities............................ 12
Description of Debt Securities........................................... 18
Description of the Trust Preferred Securities Guarantees................. 26
Relationship Among the Trust Preferred Securities, the Trust Preferred
Securities Guarantee and
the Debt Securities Held by Each Trust.................................. 28
Plan of Distribution..................................................... 29
Legal Opinions........................................................... 29
Experts.................................................................. 30
Where You Can Find More Information...................................... 30
</TABLE>
2
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RISK FACTORS
Investing in securities offered by this prospectus involves certain risks.
Any of the following risks could materially adversely affect our business
operating results and financial condition and could result in a loss of your
investment. You should carefully consider the following risks as well as the
other information contained or incorporated by reference in this prospectus
before purchasing the securities.
In this prospectus, "we", "us", "our" and "Torchmark" refer to Torchmark
Corporation. Unless the context otherwise requires, "Trusts" refers to
Torchmark Capital Trust I and Torchmark Capital Trust II.
We Operate in a Mature, Highly Competitive Industry, Which Could Limit Our
Ability to Gain or Maintain Our Position.
Life and health insurance is a mature industry. In recent years, the
industry has experienced virtually no growth in life insurance sales, though
the aging population has increased the demand for retirement savings products.
Insurance is a highly competitive industry and we encounter significant
competition in all lines of business from other insurance companies, many of
which have greater financial resources than us, as well as competition from
other providers of financial services.
The life and health insurance industry is consolidating, with larger, more
efficient organizations emerging from consolidation. Also, mutual insurance
companies are converting to stock ownership which will give them greater access
to capital markets than in the past.
Our ability to compete is dependent upon, among other things, our ability to
attract and retain distribution channels to market our insurance and investment
products, our ability to develop competitive and profitable products, our
ability to maintain low unit costs, and our maintenance of strong financial
strength ratings from rating agencies.
A Ratings Downgrade Could Adversely Affect Our Ability to Compete.
Ratings are an important factor in our competitive position. Rating
organizations periodically review the financial performance and condition of
insurers, including our insurance subsidiaries. A downgrade in the ratings of
our insurance subsidiaries could adversely affect their ability to sell their
products and their ability to compete for attractive acquisition opportunities.
Rating organizations assign ratings based upon several factors. While most
of the considered factors relate to the rated company, some of the factors
relate to general economic conditions and circumstances outside the rated
company's control. For the past several years rating downgrades in the industry
have exceeded upgrades.
Declining Interest-Rates Could Negatively Affect Our Spread Income.
Sudden and/or significant changes in interest rates expose insurance
companies to the risk of not earning anticipated spreads between the interest
rate earned on investments and the credited rates paid on outstanding policies.
Declining interest rates can negatively affect our spread income. While we
attempt to manage our investments to preserve spread income, we can give no
assurance that a significant decline in interest rates will not materially
affect such spreads. In addition, lower interest rates may result in lower
sales of our insurance and investment products.
Regulatory Changes Could Adversely Affect Our Business.
Our insurance subsidiaries are subject to government regulation in each of
the states in which they conduct business. State agencies have broad
administrative power over many aspects of the insurance business, which may
include premium rates, marketing practices, advertising, licensing agents,
policy forms, capital adequacy and permitted investments. Government regulators
are concerned primarily with the protection of policyholders rather than our
shareholders. Insurance laws, regulations and policies currently affecting us
and our subsidiaries may change at any time having an adverse effect on our
business. Furthermore, we cannot predict the timing or form of any future
regulatory initiatives.
3
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Medicare Supplement insurance constitutes a significant portion of our
health insurance business. Because of increasing medical cost inflation and
concerns about the solvency of the Medicare program, it is likely that changes
will be made to the Medicare program in the future. These changes could have an
adverse effect on our business.
The Tax Treatment of Our Policyholders' Earnings Could Change.
Under the Internal Revenue Code of 1986, as amended, income tax payable by
policyholders on investment earnings is deferred during the accumulation period
of certain life insurance and annuity products. This favorable tax treatment
may give certain of our products a competitive advantage over other non-
insurance products. To the extent that the internal revenue code is revised to
reduce the tax-deferred status of life insurance and annuity products, or to
increase the tax-deferred status of competing products, all life insurance
companies, including our subsidiaries, would be adversely affected with respect
to their ability to sell such products, and, depending on grandfathering
provisions, the surrenders of existing annuity contracts and life insurance
policies.
Industrywide Litigation Concerning Sales Practices, Agent Misconduct, Failure
to Supervise Agents, and Other Matters Could Result in Substantial Judgments
Against Us.
A number of civil jury verdicts have been returned against insurers in the
jurisdictions in which we do business involving the insurers' sales practices,
alleged agent misconduct, failure to properly supervise agents, and other
matters. Increasingly these lawsuits have resulted in the award of substantial
judgments against the insurer that are disproportionate to the actual damages,
including material amounts of punitive damages. In some states, including
Alabama, juries have substantial discretion in awarding punitive damages which
creates the potential for unpredictable material adverse judgments in any given
punitive damages suit. We, like other insurers, in the ordinary course of
business, are involved in such litigation or alternatively in arbitration. The
outcome of any such litigation or arbitration cannot be predicted with
certainty. In addition, in some class action and other lawsuits involving
insurers' sales practices, insurers have made material settlement payments.
Our Investments are Subject to Market Risks.
Our invested assets are subject to customary risks of defaults and changes
in market values. Factors that may affect the overall default rate on, and
market value of, our invested assets include interest rate levels, financial
market performance, and general economic conditions, as well as particular
circumstances affecting the businesses of individual borrowers and tenants.
Year 2000 Computer Compliance Issues May Adversely Affect Us.
The new millennium poses a significant concern to all businesses which use
computer systems or electronic data in their operations. This concern arises
because the computer systems and programs used by organizations cannot always
identify a proper date. For many years, programs were written using a two digit
code to represent a year. At the beginning of the year 2000, more digits are
needed to accurately determine the date in these programs. Without addressing
this issue, many computer programs could fail or produce erroneous results.
Additionally, companies which are electronically engaged with other businesses
or which rely on other businesses for services are exposed to risk of failure
by the electronic devices and computer systems of those other entities which
are not Year 2000 compliant. The potential of failure of these systems creates
considerable uncertainty and could potentially adversely affect the ongoing
operations and stability of a business.
Torchmark is exposed to these risks should its computer systems fail due to
date-related problems. We are also reliant on a number of third party
businesses and governmental agencies with which we either interact
electronically or depend upon for services in the conduct of our business.
These institutions include but are not limited to banks, financial
institutions, telecommunication companies, utilities, mail delivery
organizations, and a variety of governmental agencies. Should our computer
systems or the systems of our third-party business partners not be compliant,
we may be exposed to considerable risks, including business interruption, loss
of revenue, increased expense, loss of policyholders, and litigation.
4
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To reduce our business risk to an acceptable level, we have established a
project plan to insure that our business-critical computer systems will be Year
2000 compliant. This plan also addresses third-party compliance issues. Under
the direction of executive management, objectives and timetables have been set
forth to achieve compliance in each geographic location where Torchmark
operates. Progress toward achieving those objectives is constantly monitored.
We currently expect the entire project, including all Year 2000 testing
activities, to be completed during 1999.
As of June 30, 1999, Torchmark remains on schedule to meet all of its Year
2000 compliance requirements. All known required software changes have been
completed, and further testing currently in process is planned to be completed
in 1999. With regard to third party concerns, we have in process the following
procedures:
(1) We are confirming, with our software vendors, the Year 2000 readiness
of our purchased software packages on all of our computer platforms;
(2) We are verifying the Year 2000 compliance status of our financial
business partners' computer and data communications systems to insure
readiness, including data interface testing with third parties; and
(3) All of our electronic operational systems (telephones, security,
utility, environmental) are being evaluated for Year 2000 compliance.
There can be no assurances that our Year 2000 efforts will be successful,
that interactions with other service providers with Year 2000 issues will not
impair our operations, or that the Year 2000 issue will not otherwise adversely
affect us.
Should some of our systems not be available due to Year 2000 problems, in a
reasonably likely worst case scenario, we may experience significant delays in
our ability to perform certain functions, but we do not expect an inability to
perform critical functions or to otherwise conduct business. However, other
worst case scenarios, depending upon their duration, could have a material
adverse effect on us and our operations.
Our Ability to Pay Principal, Interest and/or Dividends on Offered Securities
is Limited by the Amounts Our Subsidiaries May Pay to Us.
Our ability to pay principal and interest on any Debt Securities or
dividends on any Preferred Stock is affected by the ability of our insurance
company subsidiaries, our principal sources of cash flow, to declare and
distribute dividends on their common stock and preferred stock held by us. Our
insurance company subsidiaries are subject to various state statutory and
regulatory restrictions, applicable to insurance companies generally, that
limit the amount of cash dividends, loans and advances that those subsidiaries
may pay to us. For example, under certain state insurance laws, an insurance
company generally may pay dividends only out of its unassigned surplus as
reflected in its statutory financial statements filed in that state.
We can give no assurance that more stringent restrictions will not be
adopted from time to time by states in which our insurance subsidiaries are
domiciled, which could have the effect, under certain circumstances, of
significantly reducing dividends or other amounts payable to us by such
subsidiaries without affirmative prior approval by state insurance regulatory
authorities. In addition, we rely on our ability to increase our premiums based
upon a number of factors including loss experience. Our inability to obtain
approval of rate increases in a timely manner from state insurance regulatory
authorities could adversely impact our business and the ability of our
insurance subsidiaries to declare and distribute dividends.
Our results may vary from year to year on account of fluctuations in policy
claims received by us. A significant increase in policy claims could adversely
impact our business and the ability of our insurance subsidiaries to declare
and distribute dividends.
In the event of the insolvency, liquidation, reorganization, dissolution or
other winding-up of one of our insurance subsidiaries, all creditors of such
subsidiary, including holders of life and health insurance policies, would be
entitled to payment in full out of the assets of such subsidiary before we, as
shareholder, would be entitled to any payments. Creditors of subsidiaries would
have to be paid in full before our creditors, including holders of debt
securities, and would be entitled to receive any payment from the assets of
such subsidiary.
5
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FORWARD-LOOKING STATEMENTS
This prospectus and the information incorporated by reference include
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, and Section 21E of the Securities Exchange Act of 1934 that
reflect Torchmark's current view with respect to future events and financial
performance. Some of the forward-looking statements can be identified by the
use of forward-looking words such as "believes," "expects," "may," "will,"
"should," "seeks," "approximately," "intends," "plans," "estimates," or
"anticipates" or the negative of those words or other comparable terminology.
These forward-looking statements are subject to inherent risks and
uncertainties, including those identified in "Risk Factors," as well as those
noted in the documents incorporated by reference which could cause actual
results to differ materially from historical results or anticipated results.
You are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of their dates. Torchmark undertakes no
obligation to update or revise forward-looking statements to reflect changed
assumptions, the occurrence of unanticipated events or changes to projections
over time.
6
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TORCHMARK CORPORATION
Torchmark is an insurance and diversified financial services holding company
that provides individual life and supplemental health insurance and related
products. Torchmark was incorporated in Delaware on November 19, 1979. It is
the ultimate parent company of Liberty National Life Insurance Company, Globe
Life And Accident Insurance Company, United American Insurance Company, United
Investors Life Insurance Company, and American Income Life Insurance Company.
Torchmark's principal executive offices are located at 2001 Third Avenue South,
Birmingham, Alabama 35233, and its telephone number is (205) 325-4200.
THE TRUSTS
We created two Delaware business trusts by executing, as sponsor, two
Declarations of Trust with four appointed trustees for each trust. The trusts
are named Torchmark Capital Trust I and Torchmark Capital Trust II (each, a
"Trust"). Prior to the issuance of trust preferred securities, we will file an
Amended and Restated Declaration of Trust for the Trust that will issue the
trust preferred securities. The trust declaration will state the terms and
conditions for the Trust to issue and sell its preferred securities and its
common securities. A form of trust declaration is filed as an exhibit to the
registration statement of which this prospectus is a part.
Each Trust will exist solely to:
. issue and sell its trust preferred and trust common securities;
. use the proceeds from the sale of its trust preferred and trust common
securities to purchase a series of our debt securities; and
. engage in other activities that are necessary or incidental to these
purposes.
We will purchase all of the trust common securities of each Trust. Unless
otherwise stated in the applicable prospectus supplement, the trust common
securities will represent an aggregate liquidation amount equal to at least 3%
of each Trust's total capitalization. The trust preferred securities will
represent the remaining approximately 97% of such Trust's total capitalization.
The trust common securities will have terms substantially identical to, and
will rank equal in priority of payment with, the trust preferred securities.
However, if an event of default under the related trust declaration has
occurred, then cash distributions and liquidation, redemption and other amounts
payable on the trust common securities will rank lower in priority of payment
than the trust preferred securities.
We will guarantee the trust preferred securities as described later in this
prospectus and the applicable prospectus supplement.
We have appointed four trustees to conduct the Trusts' business and affairs:
. Bank One Delaware, Inc. as the Delaware trustee; and
. three officers of Torchmark as the regular trustees.
Only Torchmark, as the only holder of the trust common securities of each
Trust, can remove or replace the trustees. In addition, we can increase or
decrease the number of trustees. The majority of trustees, however, will always
be regular trustees.
We will pay all fees and expenses related to each Trust and to each offering
of the related preferred securities, except each Trust will pay for its
obligations under the related trust preferred and trust common securities.
The Trusts will not have separate financial statements. The statements would
not be material to holders of the preferred securities because the Trusts will
not have any independent operations. The Trusts exist solely for the reasons
stated above.
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USE OF PROCEEDS
The net proceeds of the sale of the trust common and trust preferred
securities issued by each Trust will be invested by the applicable Trust in the
related series of our debt securities. Unless otherwise stated in the
applicable prospectus supplement, we intend to use those proceeds, in addition
to the net proceeds of any securities sold by us, for possible repurchases of
our outstanding securities and for general corporate purposes, including
working capital, repayment of bank debt, acquisitions and other business
opportunities.
RATIO OF EARNINGS FROM CONTINUING OPERATIONS TO COMBINED FIXED
CHARGES AND PREFERRED STOCK DIVIDENDS
The following table presents the ratio of earnings from continuing
operations to combined fixed charges and preferred stock dividends for
Torchmark for the periods indicated.
<TABLE>
<CAPTION>
Three Months Ended
Years Ended December 31, March 31,
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1994 1995 1996 1997 1998 1999
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<S> <C> <C> <C> <C> <C> <C>
Ratio of earnings from continuing
operations to combined fixed
charges and preferred stock
dividends:
Excluding interest credited on
deposit products................. 4.8 4.4 5.2 5.3 6.9 8.9
Including interest credited on
deposit products................. 3.1 2.8 3.1 3.1 3.8 4.3
</TABLE>
For purposes of computing these ratios, earnings represent consolidated
income before income taxes and fixed charges. Combined fixed charges represent
interest expense, including interest credited on deposit products where
indicated, and that portion of rental expense deemed representative of the
interest factor. The denominator is increased for preferred stock dividend
requirements which represent the amount of pre-tax earnings required to cover
such dividend requirements.
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DESCRIPTION OF SECURITIES
This prospectus contains a summary of our preferred stock, depositary
shares, debt securities, preferred securities of the Trusts, and preferred
securities guarantees of Torchmark relating to each Trust. The securities
issued by the Trusts will be identical to each individual Trust, except as
otherwise described in the prospectus supplement for such securities. These
summaries are not meant to be a complete description of each security. However,
this prospectus and the accompanying prospectus supplement contain the material
terms and conditions for each security.
DESCRIPTION OF CAPITAL STOCK
The following descriptions of our capital stock are not complete. You should
also read our Restated Certificate of Incorporation, as amended, our Bylaws and
the Delaware General Corporation Law. We have filed copies of the Restated
Certificate of Incorporation and the Bylaws with the SEC. These documents are
incorporated by reference into the registration statement of which this
prospectus is a part.
We have 325,000,000 shares of capital stock authorized, of which 320,000,000
shares are common stock and 5,000,000 shares are preferred stock. As of June
30, 1999, we had 133,257,162 shares of common stock issued and outstanding, and
299,493 shares of our preferred stock were issued and outstanding.
Preferred Stock
We are authorized to issue 5,000,000 shares of preferred stock, 299,493
shares of which currently are issued and outstanding. The following is a
general description of the terms of our preferred stock. The particular terms
of any series of preferred stock offered hereby will be set forth in a
prospectus supplement relating to such securities. The rights, preferences,
privileges and restrictions, including dividend rights, voting rights, terms of
redemption and liquidation preferences, of the preferred stock of each series
will be fixed or designated pursuant to a certificate of designations adopted
by our Board of Directors or a duly authorized committee of our board. The
description of preferred stock set forth below and the description of the terms
of a particular series of 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 preferred stock will rank in
preference to Torchmark's 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 their purchase
price, shares of preferred stock will be fully paid and nonassessable.
Dividends. Holders of a series of preferred stock will be entitled to
receive, when, as and if declared by our Board of Directors out of any funds
legally available for that purpose, dividends in cash at such 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 that series of preferred stock, before any dividends may be
declared, paid or set apart for payment upon the common stock or any other
class of stock ranking junior to that series of preferred stock. No dividend
may be declared or paid on any series of preferred stock unless at the same
time a dividend in like proportion to the designated dividend amounts has been
declared or paid on each other series of preferred stock then issued and
outstanding ranking prior to or on a parity with that particular series with
respect to the payment of dividends. Dividends on preferred stock may be either
cumulative or noncumulative.
Liquidation Preference. In the event of our liquidation, dissolution or
winding up, whether voluntary or involuntary, holders of 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 our available assets, in preference to the holders of common
stock or any other class of stock ranking junior to such series of preferred
stock upon liquidation, dissolution or winding up.
Redemption and Conversion. Each series of 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 preferred
stock will not be convertible.
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Voting Rights. The holders of the 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 preferred stock will be noncumulative.
DESCRIPTION OF DEPOSITARY SHARES
The following description of the depositary shares is not complete. You
should also read the form of Deposit Agreement relating to the depositary
shares and the depositary receipt relating to the preferred stock that is
attached to the Deposit Agreement. We have filed those documents with the SEC
as an exhibit to the registration statement of which this prospectus is a part.
General
If we elect to offer fractional interests in shares of preferred stock, we
will provide for the issuance by a depositary to the public of receipts for
depositary shares. Each depositary share will represent fractional interests of
preferred stock. We will deposit the shares of preferred stock underlying the
depositary shares under a Deposit Agreement between us and a bank or trust
company selected by us which will sometimes be referred to herein as the
depositary. The bank or trust company must have its principal office in the
United States and a combined capital and surplus of at least $100 million. The
depositary receipts will evidence the depositary shares issued under the
Deposit Agreement.
The Deposit Agreement will contain terms applicable to the holders of
depositary shares in addition to the terms stated in the depositary receipts.
Each owner of depositary shares will be entitled to all the rights and
preferences of the preferred stock underlying the depositary shares in
proportion to the applicable fractional interest in the underlying shares of
preferred stock. The depositary will issue the depositary receipts to
individuals purchasing the fractional interests in shares of the related
preferred stock according to the terms of the offering described in a
prospectus supplement.
Dividends and Other Distributions
The depositary will distribute all cash dividends or other cash
distributions received for the preferred stock to the entitled record holders
of depositary shares in proportion to the number of depositary shares that the
holder owns on the relevant record date. The depositary will distribute only an
amount that can be distributed without attributing to any holder of depositary
shares a fraction of one cent. The depositary will add the undistributed
balance to and treat it as part of the next sum received by the depositary for
distribution to holders of depositary shares.
If there is a non-cash distribution, the depositary will distribute property
received by it to the entitled record holders of depositary shares, in
proportion, insofar as possible, to the number of depositary shares owned by
the holders, unless the depositary determines, after consultation with us, that
it is not feasible to make such distribution. If this occurs, the depositary
may, with our approval, sell such property and distribute the net proceeds from
the sale to the holders. The Deposit Agreement also will contain provisions
relating to how any subscription or similar rights that we may offer to holders
of the preferred stock will be available to the holders of the depositary
shares.
Conversion, Exchange and Redemption
If any series of preferred stock underlying the depositary shares is
converted or exchanged, each record holder of depositary receipts will have the
right or obligation to convert or exchange the depositary shares represented by
the depositary receipts.
Whenever we redeem shares of preferred stock held by the depositary, the
depositary will redeem, at the same time, the number of depositary shares
representing the preferred stock. The depositary will redeem the depositary
shares from the proceeds it receives from the corresponding redemption, in
whole or in part, of the
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applicable series of preferred stock. The depositary will mail notice of
redemption to the record holders of the depositary shares which are to be
redeemed between 30 and 60 days before the date fixed for redemption. The
redemption price per depositary share will be equal to the applicable fraction
of the redemption price per share on the applicable series of preferred stock.
If less than all the depositary shares are to be redeemed, the depositary will
select which shares to be redeemed by lot, proportionate allocation or any
other method.
After the date fixed for redemption, the depositary shares called for
redemption will no longer be outstanding. When the depositary shares are no
longer outstanding, all rights of the holders will end, except the right to
receive money, securities or other property payable upon redemption.
Voting
When the depositary receives notice of a meeting at which the holders of the
preferred stock are entitled to vote, the depositary will mail the particulars
of the meeting to the record holders of the depositary shares. Each record
holder of depositary shares on the record date may instruct the depositary on
how to vote the shares of preferred stock underlying the holder's depositary
shares. The depositary will try, if practical, to vote the number of shares of
preferred stock underlying the depositary shares according to those
instructions. We will agree to take all reasonable action requested by the
depositary to enable it to vote as instructed.
Amendments
We and the depositary may agree to amend the Deposit Agreement and the
depositary receipt evidencing the depositary shares. Any amendment that (a)
imposes or increases certain fees, taxes or other charges payable by the
holders of the depositary shares as described in the Deposit Agreement or that
(b) otherwise prejudices any substantial existing right of holders of
depositary shares, will not take effect until 30 days after the depositary has
mailed notice of the amendment to the record holders of depositary shares. Any
holder of depositary shares that continues to hold its shares at the end of the
30-day period will be deemed to have agreed to the amendment.
Termination
We may direct the depositary to terminate the Deposit Agreement by mailing a
notice of termination to holders of depositary shares at least 30 days prior to
termination. In addition, a Deposit Agreement will automatically terminate if:
. the depositary has redeemed all related outstanding depositary shares;
or
. we have liquidated, terminated or wound up our business and the
depositary has distributed the preferred stock of the relevant series to
the holders of the related depositary shares.
Payment of Fees And Expenses
We will pay all fees, charges and expenses of the depositary, including the
initial deposit of the preferred stock and any redemption of the preferred
stock. Holders of depositary shares will pay transfer and other taxes and
governmental charges and any other charges as are stated in the Deposit
Agreement for their accounts.
Resignation And Removal of Depositary
At any time, the depositary may resign by delivering notice to us, and we
may remove the depositary. Resignations or removals will take effect upon the
appointment of a successor depositary and its acceptance of the appointment.
The 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 a combined capital and surplus
of at least $100 million.
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Miscellaneous
The depositary will forward to the holders of depositary shares all reports
and communications from us that are delivered to the depositary and that we are
required by law, the rules of an applicable securities exchange or our Restated
Certificate of Incorporation to furnish to the holders of the preferred stock.
Neither we nor the depositary will be liable if the depositary is prevented or
delayed by law or any circumstances beyond its control in performing its
obligations under the Deposit Agreement. The Deposit Agreement limits our
obligations and the depositary's obligations to performance in good faith of
the duties stated in the Deposit Agreement. Neither we nor the depositary will
be obligated to prosecute or defend any legal proceeding connected with any
depositary shares or preferred stock unless the holders of depositary shares
requesting us to do so furnish us with satisfactory indemnity. In performing
our obligations, we and the depositary may rely upon the written advice of our
counsel or accountants, on any information that competent people provide to us
and on documents that we believe are genuine.
DESCRIPTION OF THE TRUST PREFERRED SECURITIES
The following is a summary of the general terms of the trust preferred
securities. We will file a prospectus supplement that may contain additional
terms when a Trust issues preferred securities. The terms presented here,
together with the terms in a related prospectus supplement, will be a
description of the material terms of the trust preferred securities to be sold.
You should also read the trust declaration for each Trust and, the indentures
between Torchmark and certain trustees relating to the issuance of the debt
securities by Torchmark. We have filed these documents with the SEC as exhibits
to the registration statement of which this prospectus is a part.
General
Each trust declaration authorizes the regular trustees to issue on behalf of
a Trust one series of trust preferred securities that will have the terms
described in a prospectus supplement. A Trust will use the proceeds from the
sale of its preferred and common securities to purchase a series of our debt
securities. The property trustee will hold the debt securities in trust for the
benefit of the holders of the trust preferred and trust common securities.
Torchmark will guarantee the trust preferred securities under a Trust
Preferred Securities Guarantee. We will agree to make payments of distributions
and payments on redemption or liquidation concerning a Trust's trust preferred
securities, but only if the Trust has funds available to make those payments
and has not done so. See "Description of the Trust Preferred Securities
Guarantees" on page 26.
The assets of a Trust available for distribution to the holders of its trust
preferred securities will be limited to payments from us under the series of
debt securities held by the Trust. If we fail to make a payment on the related
debt securities, the Trust will not have enough funds to make related payments,
including distributions on its preferred securities.
Each guarantee, when taken together with our obligations under the related
series of debt securities and the indenture and the related trust declaration,
will provide a full and unconditional guarantee of amounts due on the trust
preferred securities issued by a Trust.
Each trust declaration will be qualified as an indenture under the Trust
Indenture Act of 1939. Each property trustee will act as indenture trustee for
the trust preferred securities to be issued by the applicable Trust, in order
to comply with the provisions of the Trust Indenture Act.
Each series of trust preferred securities will have the terms, including
distributions, redemption, voting, liquidation rights and such other preferred,
deferred or other special rights or restrictions as are described in the
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relevant trust declaration or made part of the trust declaration by the Trust
Indenture Act or by the Delaware Business Trust Act. The terms of the preferred
securities will mirror the terms of the debt securities held by the applicable
Trust.
The prospectus supplement relating to the trust preferred securities of a
Trust will describe the specific terms of the preferred securities, including:
. the name of the trust preferred securities;
. the dollar amount and number of trust preferred securities issued;
. the annual distribution rate(s), or method of determining the rate(s),
the payment date(s) and the record dates used to determine the holders
who are to receive distributions and the place(s) where distributions
and other amounts payable will be paid;
. any provision relating to deferral of distribution payments;
. the date from which distributions shall be cumulative;
. the optional redemption provisions, if any, including the prices, time
periods and other terms and conditions for which trust preferred
securities will be purchased or redeemed, in whole or in part;
. the terms and conditions, if any, upon which the applicable series of
debt securities may be distributed to holders of such trust preferred
securities;
. the voting rights, if any, of holders of the trust preferred securities;
. any securities exchange on which the trust preferred securities will be
listed;
. whether such trust preferred securities are to be issued in book-entry
form and represented by one or more global certificates, and if so, the
depositary for such global certificates and the specific terms of the
depositary arrangements; and
. any other relevant rights, preferences, privileges, limitations or
restrictions of such trust preferred securities.
Each prospectus supplement will describe the United States federal income
tax considerations applicable to the purchase, holding and disposition of the
series of trust preferred securities covered by the prospectus supplement.
Liquidation Distribution Upon Dissolution
Unless otherwise specified in the applicable prospectus supplement, each
trust declaration states that the related Trust shall be dissolved:
. upon the expiration of the term of such Trust;
. upon the bankruptcy of Torchmark;
. upon the filing of a certificate of dissolution or its equivalent by
Torchmark;
. upon the consent of at least a majority in liquidation amount of the
trust preferred and trust common securities of the related Trust, voting
together as a single class to dissolve the Trust;
. 90 days after the revocation of our charter and the charter is not
reinstated during that 90-day period;
. upon the written direction from us and after the distribution of the
related debt securities directly to the holders of the trust preferred
and trust common securities of the applicable Trust in exchange for
those securities within 90 days after notice, as long as the regular
trustees receive an opinion of nationally recognized counsel to the
effect that the holders of the trust preferred and the trust common
securities will not recognize income, gain or loss for United States
federal income tax purposes as a result of the termination of the Trust
and the distribution of the debt securities;
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. upon the occurrence of adverse tax or other specified events that cause
the Trust to be dissolved and the distribution of the related debt
securities directly to the holders of the trust preferred and trust
common securities of the Trust;
. before the issuance of any securities with the consent of all regular
trustees and Torchmark;
. upon the redemption of all of the trust common and trust preferred
securities of such Trust; or
. upon entry of a court order for the dissolution of Torchmark or such
Trust.
Unless otherwise specified in the applicable prospectus supplement, in the
event of a dissolution, after the Trust pays all amounts owed to creditors, the
holders of the trust preferred and trust common securities issued by the Trust
will be entitled to receive:
. cash equal to the aggregate liquidation amount of each trust preferred
and trust common security specified in an accompanying prospectus
supplement, plus accumulated and unpaid distributions to the date of
payment; unless
. debt securities in an aggregate principal amount equal to the aggregate
liquidation amount of the trust preferred and trust common securities
are distributed to the holders of the trust preferred and trust common
securities.
After the liquidation date is fixed for any distribution of debt securities:
. the trust preferred securities will no longer be deemed to be
outstanding;
. DTC or its nominee, as the registered holder of the trust preferred
securities, will receive a registered global certificate or certificates
representing debt securities to be delivered upon distribution with
respect to the trust preferred securities held by DTC or its nominee;
and
. any certificates representing trust preferred securities not held by DTC
or its nominee will be deemed to represent debt securities having a
principal amount equal to the $25 stated liquidation amount of the trust
preferred securities and bearing accrued and unpaid interest in an
amount equal to the accumulated and unpaid distributions on the trust
preferred securities until the holder of those certificates presents
them to the registrar for the trust preferred securities for transfer or
reissuance.
If the Trust cannot pay the full amount due on its trust preferred and trust
common securities because it does not have enough assets for payment, then the
amounts the Trust owes on its trust preferred and trust common securities will
be proportionately allocated. However, if an event of default under the related
trust declaration has occurred, the total amounts due on the trust preferred
securities will be paid before any distribution on the trust common securities.
Declaration Events of Default
An event of default under the indenture relating to a series of debt
securities is an event of default under the trust declaration of the Trust that
owns those debt securities. See "Description of Debt Securities--Events of
Default."
Under the trust declaration, we, as the holder of the trust common
securities, will be treated as if we have waived an event of default under the
trust declaration that affects us until all events of default under the trust
declaration affecting the capital securities have been cured or eliminated.
Torchmark and the regular trustees of a Trust must file annually with the
applicable property trustee a certificate stating whether or not Torchmark is
in compliance with all the applicable conditions and covenants under the
related trust declaration.
Upon the happening of an event of default under the trust declaration, the
property trustee of the applicable Trust, as the sole holder of the debt
securities held by that Trust, will have the right under any indenture to
declare the principal of, premium, if any, and interest on such debt securities
to be immediately due and payable.
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If a property trustee fails to enforce its rights under the related trust
declaration or any indenture to the fullest extent permitted by law and by the
terms of the trust declaration and any indenture, any holder of the trust
preferred securities issued by the Trust may sue us, or seek other remedies, to
enforce the property trustee's rights under the trust declaration or any
indenture without first instituting a legal proceeding against the property
trustee or any other person.
If we fail to pay principal, premium, if any, or interest on a series of
debt securities when payable, then a holder of the related trust preferred
securities may directly sue us or seek other remedies, to collect its
proportional allocation of payments owned.
Removal and Replacement of Trustees
Only we, as the only holder of a Trust's trust common securities, have the
right to remove or replace the trustees of such Trust. The resignation or
removal of any trustee and the appointment of a successor trustee shall be
effective only on the acceptance of appointment by the successor trustee in
accordance with the provisions of the trust declaration for that Trust.
Conversion or Exchange Rights
The terms that govern whether trust preferred securities of any series are
convertible into or exchangeable for our common stock or other securities of
ours will be set forth in the prospectus supplement relating to the trust
preferred securities. The terms will include provisions regarding whether
conversion or exchange is mandatory, at the option of the holder or at our
option and may include provisions that adjust the number of shares of our
common stock or other securities of ours that the holders of trust preferred
securities may receive.
Mergers, Consolidations or Amalgamations of the Trusts
A Trust may not consolidate, amalgamate, merge with or into, be replaced by,
or convey, transfer or lease its properties and assets substantially as an
entirety to, any other corporation or other body ("Merger Event"), except as
described below. A Trust may, with the consent of a majority of its regular
trustees and without the consent of the holders of its trust preferred and
trust common securities or the other Trustees, consolidate, amalgamate, merge
with or into, or be replaced by another Trust, provided that:
. the successor entity either:
(1) assumes all of the obligations of the Trust relating to its trust
preferred and trust common securities; or
(2) substitutes for the Trust's trust preferred and trust common
securities other securities substantially similar to the Trust's
trust preferred and trust common securities, so long as the
successor securities rank the same as the trust preferred and trust
common securities for distributions and payments upon liquidation,
redemption and otherwise;
. we acknowledge a trustee of the successor entity who has the same powers
and duties as the property trustee of the Trust as the holder of the
particular series of debt securities;
. the Merger Event does not adversely affect the rights, preferences and
privileges of the holders of its trust preferred and trust common
securities or successor securities in any material way, except
concerning any dilution of the holders' interest in the new entity;
. the Merger Event does not cause the trust preferred securities or
successor securities to be downgraded by any nationally recognized
statistical rating organization;
. the successor entity has a purpose identical to that of the Trust;
. the trust preferred securities or any successor securities are listed,
or any successor securities will be listed upon notification of
issuance, on any national securities exchange or with another
organization on which the preferred securities are then listed;
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. prior to the Merger Event, we have received an opinion of counsel from a
firm qualified to give such opinion stating that (a) the Merger Event
does not adversely affect the rights, preferences and privileges of the
holders of the trust preferred securities, including any successor
securities, in any material respect and (b) following the Merger Event,
neither the Trust nor the successor entity will be required to register
as an "investment company" under the Investment Company Act of 1940; and
. we guarantee the obligations of the successor entity under the successor
securities in the same manner as in the applicable guarantee and the
guarantee of the trust common securities for the Trust, if any.
In addition, unless all of the holders of the trust preferred and trust
common securities approve otherwise, a Trust shall not consolidate, amalgamate,
merge with or into, or be replaced by any other entity or permit any other
entity to consolidate, amalgamate, merge with or into, or replace it, if such
transaction would cause the Trust or the successor entity to be classified as
other than a grantor trust for United States federal income tax purposes.
Voting Rights; Amendment of Declarations
The holders of trust preferred securities have no voting rights except as
discussed above and under "--Mergers, Consolidations or Amalgamations of the
Trusts" and "Description of the Trust Preferred Securities Guarantees--
Amendments and Assignment," and as otherwise required by law and the trust
declaration for the applicable Trust.
A trust declaration may be amended if approved by a majority of the regular
trustees, and in limited circumstances, the property trustee, of the applicable
Trust. However, if any proposed amendment provides for, or the regular trustees
otherwise propose to effect,
. any action that would adversely affect the powers, preferences or
special rights of the Trust's trust preferred and trust common
securities, whether by way of amendment to such trust declaration or
otherwise, or
. the dissolution, winding-up or termination of the Trust other than under
the terms of its trust declaration,
then the holders of the Trust's trust preferred and trust common securities
voting together as a single class will be entitled to vote on the amendment or
proposal. In that case, the amendment or proposal will only be effective if
approved by at least a majority in liquidation amount of the trust preferred
and trust common securities affected by the amendment or proposal.
If any amendment or proposal referred to above would adversely affect only
the trust preferred securities or only the trust common securities of a Trust,
then only the affected class will be entitled to vote on the amendment or
proposal and the amendment or proposal will only be effective with the approval
of at least a majority in liquidation amount of the affected class.
Notwithstanding the foregoing, specified provisions of the trust declaration
may not be amended without the consent of all holders of the trust's preferred
and common securities.
No amendment may be made to a trust declaration, if the amendment would:
. cause the related Trust to be characterized as other than a grantor
trust for United States federal income tax purposes;
. reduce or otherwise adversely affect the powers of the related property
trustee, unless approved by that property trustee; or
. cause the related Trust to be deemed to be an "investment company" which
is required to be registered under the Investment Company Act.
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The holders of a majority in aggregate liquidation amount of the trust
preferred securities of each Trust have the right to:
. direct the time, method and place of conducting any proceeding for any
remedy available to the property trustee of the Trust; or
. direct the exercise of any Trust or power conferred upon such property
trustee under that Trust's trust declaration, including the right to
direct the property trustee, as the holder of a series of debt
securities, to
(1) exercise the remedies available under any indenture involving the
debt securities,
(2) waive any event of default under any indenture that is waivable,
(3) cancel an acceleration of the principal of the debt securities, or
(4) consent to any amendment, modification or termination of the
indenture where consent is required,
but if an event of default under any indenture has occurred and is continuing,
then the holders of 25% of the aggregate liquidation amount of the trust
preferred securities may direct the property trustee to declare the debt
securities immediately due and payable. If, however, any indenture requires the
consent of the holders of more than a majority in aggregate principal amount of
a series of debt securities (a "super-majority"), then the property trustee for
the trust preferred securities related to that series of debt securities must
get approval of the holders of the same super-majority in liquidation amount of
the trust preferred securities. In addition, before taking any of the foregoing
actions, except for directing the time, method and place of conducting any
proceeding for any remedy available to the property trustee, the property
trustee must obtain an opinion of counsel from a firm qualified to give such
opinion stating that the action would not cause the Trust to be classified as
other than a grantor trust for United States federal income tax purposes.
The property trustee of a Trust will notify all trust preferred securities
holders of the Trust of any notice received from the Trustee concerning the
debt securities held by the Trust.
As described in each trust declaration, the regular trustee may hold a
meeting to have trust preferred securities holders vote on a change or have
them approve the change by written consent.
If a vote of trust preferred securities holders is taken or a consent is
obtained, any trust preferred securities that are owned by us or any of our
affiliates will, for purposes of the vote or consent, be treated as if they
were not outstanding. This means that:
. we and any of our affiliates will not be able to vote on or consent to
matters requiring the vote or consent of holders of trust preferred
securities; and
. any trust preferred securities owned by us, the regular trustees or any
of our respective affiliates will not be counted in determining whether
the required percentage of votes or consents has been obtained.
Information Concerning the Property Trustees
The property trustees will be unaffiliated with us. For matters relating to
compliance with the Trust Indenture Act, the property trustee of each Trust
will have all of the duties and responsibilities of an indenture trustee under
the Trust Indenture Act. Each property trustee, other than during the
occurrence and continuance of an event of default under the trust declaration
under the applicable Trust, undertakes to perform only those duties that are
specifically stated in the applicable trust declaration and, upon an event of
default under the trust declaration, must use the same degree of care and skill
as a prudent person would exercise or use in the conduct of his or her own
affairs. In addition, a property trustee is under no obligation to exercise any
of the powers given it by the applicable trust declaration at the request of
any holder of trust preferred securities unless it is offered reasonable
security or indemnity against the costs, expenses and liabilities that it might
incur.
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Miscellaneous
The trustees of each Trust are authorized and directed to conduct the
affairs of and to operate the Trust in such a way that:
. the Trust will not be deemed to be an "investment company" required to
be registered under the Investment Company Act;
. the Trust will be classified as a grantor trust for United States
federal income tax purposes; and
. the debt securities held by the Trust will be treated as indebtedness of
Torchmark for United States federal income tax purposes.
Torchmark and the trustees of a Trust are authorized to take any legal
action that we and the trustees of that Trust determine to be necessary or
desirable for such purposes so long as the action does not violate the Trust's
certificate of trust or its trust declaration.
Holders of trust preferred securities have no preemptive or similar rights.
A Trust may not borrow money, issue debt, execute mortgages or pledge any of
its assets.
The property trustee will promptly make distributions to the holders of the
Trust's preferred securities and common securities out of funds received by
such Trust from holding our debt securities.
Governing Law
Each trust declaration and the related trust preferred securities will be
governed by and construed in accordance with the laws of the State of Delaware.
DESCRIPTION OF DEBT SECURITIES
The following is a summary of the general terms of the debt securities. We
will file a prospectus supplement that may contain additional terms when we
issue debt securities. The terms presented here, together with the terms in a
related prospectus supplement, will be a description of the material terms of
the debt securities. You should also read the Indentures described below.
We may issue, from time to time, debt securities, in one or more series,
that will consist of either our senior debt ("Senior Debt Securities"), our
senior subordinated debt ("Senior Subordinated Debt Securities"), our
subordinated debt ("Subordinated Debt Securities") or our junior subordinated
debt ("Junior Subordinated Debt Securities" and, together with the Senior
Subordinated Debt Securities and the Subordinated Debt Securities, the
"Subordinated Securities"). The Senior Debt Securities we offer will be issued
under an Indenture Agreement dated February 1, 1987, between Torchmark and
Morgan Guaranty Trust Company of New York, as the original trustee (the "Senior
Indenture"). The Senior Indenture is incorporated by reference as an exhibit to
the Registration Statement. The First National Bank of Chicago is the successor
trustee under the Senior Indenture and has served in such capacity since August
8, 1994.
The Senior Debt Securities will rank on an equal basis with all other
unsecured debt of Torchmark except any subordinated indebtedness of Torchmark.
In particular, the Senior Debt Securities will rank on an equal basis with our
8 1/4% Senior Debentures Due 2009, our 7 7/8% Notes Due 2023 and our 7 3/8%
Notes due 2013.
The Subordinated Securities we offer will be issued under a separate
indenture between us and Banc One Capital Securities, Inc., acting as trustee
(the "Junior Indenture," and together with the Senior Indenture, the
"Indentures"). We have filed the form of Junior Indenture as an exhibit to the
Registration Statement of which this prospectus is a part. Debt securities,
whether senior, senior subordinated, subordinated or junior subordinated, may
be issued as convertible debt securities or exchangeable debt securities. All
capitalized terms not defined herein have the meanings specified in the
Indentures.
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General Terms of The Indentures
The Debt Securities will be unsecured general obligations of the Company.
The Indentures do not limit the amount of debt securities that we may issue.
The Indentures provide that we may issue debt securities up to the principal
amount that we may authorize and may be in any currency or currency unit that
we may designate.
We may issue the debt securities issued under the Indentures as "discount
securities," which means they may be sold at a discount below their stated
principal amount. These debt securities, as well as other debt securities that
are not issued at a discount, may, for United States federal income tax
purposes, be treated as if they were issued with "original issue discount"
("OID") because of interest payment and other characteristics. Special United
States federal income tax considerations applicable to debt securities issued
with original issue discount will be described in more detail in any applicable
prospectus supplement.
The applicable prospectus supplement for a series of debt securities that we
issue will describe, among other things, the following terms of the offered
debt securities:
. the title;
. the designation, the aggregate principal amount and the authorized
denominations;
. whether issued in fully registered form without coupons or in a form
registered as to principal only with coupons or in bearer form with
coupons;
. whether issued in the form of one or more global securities and whether
all or a portion of the principal amount of the debt securities is
represented thereby;
. the price or prices at which the debt securities will be issued;
. the date or dates on which principal is payable;
. the place or places where and the manner in which principal, premium or
interest will be payable and the place or places where the debt
securities may be presented for transfer and, if applicable, conversion
or exchange;
. interest rates, and the dates from which interest, if any, will accrue,
and the dates when interest is payable and the maturity;
. the right, if any, to extend the interest payment periods and the
duration of the extensions;
. our rights or obligations to redeem or purchase the debt securities;
. conversion or exchange provisions, if any, including conversion or
exchange prices or rates and adjustments thereto;
. the currency or currencies of payment of principal or interest;
. the terms applicable to any debt securities issued at a discount from
their stated principal amount;
. the terms, if any, under which any debt securities will rank junior to
any of our other debt;
. if the amounts of payments of principal or interest are to be determined
by reference to an index or formula, or based on a coin or currency
other than that in which the debt securities are stated to be payable,
the manner in which these amounts are determined and the calculation
agent, if any, with respect to them;
. if other than the entire principal amount of the debt securities when
issued, the portion of the principal amount payable upon acceleration of
maturity as a result of a default on our obligations;
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. if applicable, covenants affording holders of debt protection against
changes in our operations, financial condition or transactions involving
us; and
. any other specific terms of any debt securities.
The applicable prospectus supplement will present United States federal
income tax considerations for holders of any debt securities and the securities
exchange or quotation system on which any debt securities are listed or quoted.
Senior Debt Securities
Payment of the principal of, premium, if any, and interest on Senior Debt
Securities will rank on a parity with all of our other unsecured and
unsubordinated debt.
Senior Subordinated Debt Securities
Payment of the principal of, premium, if any, and interest on Senior
Subordinated Debt Securities will be junior in right of payment to the prior
payment in full of all of our unsubordinated debt, including Senior Debt
Securities. We will state in the applicable prospectus supplement relating to
any Senior Subordinated Debt Securities the subordination terms of the
securities as well as the aggregate amount of outstanding debt, as of the most
recent practicable date, that by its terms would be senior to the Senior
Subordinated Debt Securities. We will also state in such prospectus supplement
limitations, if any, on issuance of additional senior debt.
Subordinated Debt Securities
Payment of the principal of, premium, if any, and interest on Subordinated
Debt Securities will be subordinated and junior in right of payment to the
prior payment in full of all of our senior debt, including our senior
subordinated debt. We will state in the applicable prospectus supplement
relating to any Subordinated Debt Securities the subordination terms of the
securities as well as the aggregate amount of outstanding indebtedness, as of
the most recent practicable date, that by its terms would be senior to the
Subordinated Debt Securities. We will also state in such prospectus supplement
limitations, if any, on issuance of additional senior indebtedness.
Junior Subordinated Debt Securities
Payment of the principal of, premium, if any, and interest on Junior
Subordinated Debt Securities will be subordinated and junior in right of
payment to the prior payment in full of all of our senior, senior subordinated
and subordinated debt. We will state in the applicable prospectus supplement
relating to any Junior Subordinated Debt Securities the subordination terms of
the securities as well as the aggregate amount of outstanding debt, as of the
most recent practicable date, that by its terms would be senior to the Junior
Subordinated Debt Securities. We will also state in such prospectus supplement
limitations, if any, on issuance of additional senior indebtedness.
Conversion or Exchange Rights
Debt securities may be convertible into or exchangeable for shares of our
equity securities. The terms and conditions of conversion or exchange will be
stated in the applicable prospectus supplement. The terms will include, among
others, the following:
. the conversion or exchange price;
. the conversion or exchange period;
. provisions regarding the ability of us or the holder to convert or
exchange the debt securities;
. events requiring adjustment to the conversion or exchange price; and
. provisions affecting conversion or exchange in the event of our
redemption of the debt securities.
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Limitations on Liens
We will not, and will not permit any of our subsidiaries to incur any
indebtedness which is secured by an encumbrance of any nature (a "Mortgage") on
the common stock of Liberty National, United American or Globe Life (the
"Designated Subsidiaries"), unless the Senior Debt Securities and, if we so
elect, any other indebtedness of ours ranking at least on an equal basis with
the Senior Debt Securities, shall be secured equally and ratably with, or prior
to, such other secured indebtedness. We are not restricted, however, from
incurring indebtedness for money borrowed secured as follows:
(1) Mortgages securing indebtedness owed by a Designated Subsidiary to
another Designated Subsidiary or to Torchmark;
(2) pledges or deposits under workers' compensation or other similar laws
and liens of judgments thereunder that are not currently dischargeable;
(3) good faith deposits in connection with leases to which we or any
Designated Subsidiary is a party;
(4) deposits to secure our public or statutory obligations;
(5) deposits in connection with obtaining or maintain self-insurance or to
obtain the benefits of any law, regulation or arrangement pertaining to
unemployment insurance, old age pensions, social security or similar
matters;
(6) deposits in litigation or other proceedings;
(7) Mortgages created by or resulting from any judgments or awards against
us or the Designated Subsidiaries with respect to which we are in good
faith prosecuting an appeal or other review proceedings, or Mortgages
incurred by us or any Designated Subsidiary for the purpose of
obtaining a stay or discharge in the course of any litigation to which
we are a party; or
(8) Mortgages for taxes or assessments, governmental charges or levies not
yet due or delinquent, or which can be paid thereafter without penalty,
or which are being contested in good faith by appropriate proceedings.
Limitations on Sales of Capital Stock of Certain Subsidiaries
Under the Indentures, we are not permitted to issue, sell, transfer or
dispose of (except to certain of our affiliates) any shares of capital stock of
Liberty National, United American or Globe Life, unless the entire capital
stock of such subsidiary is disposed of for consideration of cash or property,
which, in the opinion of our Board of Directors, is at least equal to the fair
value of such capital stock.
Consolidation, Merger or Sale
We cannot consolidate or merge with or into, or transfer or lease all or
substantially all of our assets to, any person unless (a) we will be the
continuing corporation or (b) the successor corporation or person to which our
assets are transferred or leased is a corporation organized under the laws of
the United States, any state of the United States or the District of Columbia
and it expressly assumes our obligations under the debt securities and the
Indentures. In addition, we cannot complete such a transaction unless
immediately after completing the transaction, no event of default under either
of the Indentures, and no event which, after notice or lapse of time or both,
would become an event of default under either of the Indentures, has happened
and is continuing. When the person to whom our assets are transferred or leased
has assumed our obligations under the debt securities and the Indentures, we
will be discharged from all our obligations under the debt securities and the
Indentures except in limited circumstances.
Events of Default
The term "Event of Default," when used in the Indentures, unless otherwise
indicated, means any of the following:
. failure to pay interest for 30 days after the date payment is due and
payable;
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. failure to pay principal or premium, if any, on any debt security when
due, either at maturity, upon any redemption, by declaration or
otherwise;
. failure to make sinking fund payments for 10 days after the date payment
is due and payable;
. failure to perform other covenants or breach of a warranty for 60 days
after notice that performance or cure of breach was required;
. events in bankruptcy, insolvency or reorganization of Torchmark; or
. a default under any other indebtedness of Torchmark if Torchmark fails
to pay a principal amount due in excess of $10,000,000 or if a principal
amount in excess of $10,000,000 is declared due prior to the date it
would have otherwise been due.
If an Event of Default involving any series of debt securities has occurred
and is continuing, the trustee or the holders of not less than 25% in aggregate
principal amount of the debt securities of each affected series may declare the
entire principal of all the debt securities of that series to be due and
payable immediately.
We will be required to file annually with the trustee a certificate, signed
by an officer of Torchmark, stating whether or not the officer knows of any
default by us in the performance, observance or fulfillment of any condition or
covenant of the Indentures.
Registered Global Securities
We may issue the debt securities of a series in whole or in part in the form
of one or more fully registered global securities. We will deposit any
registered global securities with a depositary or with a nominee for a
depositary identified in the applicable prospectus supplement and registered in
the name of such depositary or nominee. In such case, we will issue one or more
registered global securities denominated in an amount equal to the aggregate
principal amount of all of the debt securities of the series to be issued and
represented by such registered global security or securities.
Unless and until it is exchanged in whole or in part for debt securities in
definitive registered form, a registered global security may not be transferred
except as a whole:
. by the depositary for such registered global security to its nominee;
. by a nominee of the depositary to the depositary or another nominee of
the depositary; or
. by the depositary or its nominee to a successor of the depositary or a
nominee of the successor.
The prospectus supplement relating to a series of debt securities will
describe the specific terms of the depositary arrangement involving any portion
of the series represented by a registered global security. We anticipate that
the following provisions will apply to all depositary arrangements for debt
securities:
. ownership of beneficial interests in a registered global security will
be limited to persons that have accounts with the depositary for such
registered global security, these persons being referred to as
"participants," or persons that may hold interests through participants;
. upon the issuance of a registered global security, the depositary for
the registered global security will credit, on its book-entry
registration and transfer system, the participants' accounts with the
respective principal amounts of the debt securities represented by the
registered global security beneficially owned by the participants;
. any dealers, underwriters, or agents participating in the distribution
of the debt securities will designate the accounts to be credited; and
. ownership of beneficial interest in such registered global security will
be shown on, and the transfer of such ownership interest will be
effected only through, records maintained by the depositary for such
registered global security for interests of participants, and on the
records of participants for interests of persons holding through
participants.
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The laws of some states may require that specified purchasers of securities
take physical delivery of the securities in definitive form. These laws may
limit the ability of those persons to transfer beneficial interests in
registered global securities.
So long as the depositary for a registered global security, or its nominee,
is the registered owner of such registered global security, the depositary or
such nominee, as the case may be, will be considered the sole owner or holder
of the debt securities represented by the registered global security for all
purposes under the indenture. Except as stated below, owners of beneficial
interests in a registered global security:
. will not be entitled to have the debt securities represented by a
registered global security registered in their names;
. will not receive or be entitled to receive physical delivery of the debt
securities in the definitive form; and
. will not be considered the owners or holders of the debt securities
under the Indentures.
Accordingly, each person owning a beneficial interest in a registered global
security must rely on the procedures of the depositary for the registered
global security and, if the person is not a participant, on the procedures of a
participant through which the person owns its interest, to exercise any rights
of a holder under the Indentures.
We understand that under existing industry practices, if we request any
action of holders or if an owner of a beneficial interest in a registered
global security desires to give or take any action that a holder is entitled to
give or take under the indenture, the depositary for the registered global
security would authorize the participants holding the relevant beneficial
interests to give or take the action, and the participants would authorize
beneficial owners owning through the participants to give or take the action or
would otherwise act upon the instructions of beneficial owners holding through
them.
We will make payments of principal and premium, if any, and interest, if
any, on debt securities represented by a registered global security registered
in the name of a depositary or its nominee to the depositary or its nominee, as
the case may be, as the registered owners of the registered global security.
Neither Torchmark, the trustee nor any other agent of Torchmark or the trustee
will be responsible or liable for any aspect of the records relating to, or
payments made on account of, beneficial ownership interests in the registered
global security or for maintaining, supervising or reviewing any records
relating to the beneficial ownership interests.
We expect that the depositary for any debt securities represented by a
registered global security, upon receipt of any payments of principal and
premium, if any, and interest, if any, in respect of the registered global
security, will immediately credit participants' accounts with payments in
amounts proportionate to their respective beneficial interests in the
registered global security as shown on the records of the depositary. We also
expect that standing customer instructions and customary practices will govern
payments by participants to owners of beneficial interests in the registered
global security held through the participants, as is now the case with the
securities held for the accounts of customers in bearer form or registered in
"street name." We also expect that any of these payments will be the
responsibility of the participants.
If the depositary for any debt securities represented by a registered global
security is at any time unwilling or unable to continue as depositary or stops
being a clearing agency registered under the Exchange Act, we will appoint an
eligible successor depositary. If we fail to appoint an eligible successor
depositary within 90 days, we will issue the debt securities in definitive form
in exchange for the registered global security. In addition, we may at any time
and in our sole discretion decide not to have any of the debt securities of a
series represented by one or more registered global securities. In that event,
we will issue debt securities of the series in a definitive form in exchange
for all of the registered global securities representing the debt securities.
The trustee will register any debt securities issued in definitive form in
exchange for a registered global security in the name or names as the
depositary, based upon instructions from its participants, shall instruct the
trustee.
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We may also issue bearer debt securities of a series in the form of one or
more global securities, referred to as "bearer global securities." We will
deposit these securities with a common depositary for Euroclear System and
Cedel Bank, societe anonyme, or with a nominee for the depositary identified in
the prospectus supplement relating to the series. The prospectus supplement
relating to a series of debt securities represented by a bearer global security
will describe the applicable terms and procedures. These will include the
specific terms of the depositary arrangement and any specific procedures for
the issuance of debt securities in definitive form in exchange for a bearer
global security, in proportion to the series represented by a bearer global
security.
Discharge, Defeasance and Covenant Defeasance
We can discharge or decrease our obligations under each of the Indentures as
stated below.
We may discharge obligations to holders of any series of debt securities
that have not already been delivered to the trustee for cancellation and that
have either become due and payable or are by their terms to become due and
payable, or are scheduled for redemption, within one year. We may effect a
discharge by irrevocably depositing with the trustee cash or U.S. government
obligations, as trust funds, in an amount certified to be enough to pay when
due, whether at maturity, upon redemption or otherwise, the principal of,
premium, if any, and interest on the debt securities and any mandatory sinking
fund payments.
Unless otherwise provided in the applicable prospectus supplement, we may
also discharge any and all of our obligations to holders of any series of debt
securities at any time ("defeasance"). We may also be released from the
obligations imposed by any covenants of any outstanding series of debt
securities and provisions of the Indentures, and we may omit to comply with
those covenants without creating an event of default under the trust
declaration ("covenant defeasance"). We may effect defeasance and covenant
defeasance only if, among other things:
. we irrevocably deposit with the trustee cash or U.S. government
obligations, as trust funds, in an amount certified to be enough to pay
at maturity, or upon redemption, the principal, premium, if any, and
interest on all outstanding debt securities of the series;
. we deliver to the trustee an opinion of counsel from a law firm
qualified to give such opinion to the effect that the holders of the
series of debt securities will not recognize income, gain or loss for
U.S. federal income tax purposes as a result of the defeasance or
covenant defeasance and that defeasance or covenant defeasance will not
otherwise alter the holders' U.S. federal income tax treatment of
principal, premium, if any, and interest payments on the series of debt
securities; and
. in the case of subordinated debt securities, no event or condition
shall exist that, based on the subordination provisions applicable to
the series, would prevent us from making payments of principal of,
premium, if any, and interest on any of the applicable subordinated
debt securities at the date of the irrevocable deposit referred to
above or at any time during the period ending on the 91st day after the
deposit date.
Although we may discharge or decrease our obligations under the Indentures
as described in the two preceding paragraphs, we may not avoid, among other
things, our duty to register the transfer or exchange of any series of debt
securities, to replace any temporary, mutilated, destroyed, lost or stolen
series of debt securities or to maintain an office or agency in respect of any
series of debt securities.
Modification of the Indentures
The Indentures provide that we and the trustee may enter into supplemental
indentures without the consent of the holders of debt securities to:
. secure any debt securities;
. evidence the assumption by a successor corporation of our obligations;
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. add covenants for the protection of the holders of debt securities;
. add any additional events of default under the Indentures;
. cure any ambiguity or correct any inconsistency in the Indentures;
. change or eliminate provisions of the Indentures, provided such change
or elimination will only become effective after all then current
outstanding debt securities are no longer outstanding;
. establish the forms or terms of debt securities of any series; and
. evidence and provide for the acceptance of appointment by a successor
trustee.
Each of the Indentures also provides that we and the trustee may, with the
consent of the holders of not less than 66 2/3% in aggregate principal amount
of debt securities of all series of Senior Debt Securities or of Subordinated
Securities, as the case may be, then outstanding and affected, voting as one
class, add any provisions to, or change in any manner, eliminate or modify in
any way the provisions of, the applicable indenture or modify in any manner the
rights of the holders of the debt securities. We and the trustee may not,
however, without the consent of the holder of each outstanding debt security
affected thereby:
. change the stated maturity of any debt security;
. reduce the principal amount or premium, if any, or interest on any debt
security;
. change the place of payment or the currency in which the principal,
unless otherwise provided for a series, premium, if any, or interest is
payable;
. reduce the amount of the principal of any debt security issued with an
original issue discount that is payable upon acceleration or provable
in bankruptcy;
. impair the right to institute suit for the enforcement of any payment
on any debt security when due; or
. reduce the percentage of holders of debt securities of any series whose
consent is required for any modification of the Indentures or, waive
compliance with or default under certain provisions of the Indentures.
Concerning the Trustee
The First National Bank of Chicago is the trustee under the Senior
Indenture. Torchmark may also maintain banking and other commercial
relationships with The First National Bank of Chicago and its affiliates in the
ordinary course of business. The Indentures contain certain limitations on the
right of the trustee, should it become a creditor of Torchmark, to obtain
payment of claims in certain cases, or to realize for its own account on
certain property received in respect of any such claim as security or
otherwise. A trustee under the Indentures will be permitted to engage in
certain other transactions; however, if it acquires any conflicting interest,
it must eliminate such conflict or resign.
Governing Law
The Indentures and the debt securities will be governed by, and construed in
accordance with, the laws of the State of New York.
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DESCRIPTION OF THE TRUST PREFERRED SECURITIES GUARANTEES
The following is a description of the material terms of the trust preferred
securities guarantees. If we plan to issue a trust preferred securities
guarantee in the future that differs from this description, we will file a
prospectus supplement with the additional terms. You should also read the
guarantees. We have filed the form of guarantees with the SEC as an exhibit to
the registration statement of which this prospectus is a part.
General
We will execute a guarantee, which benefits the holders of trust preferred
securities, at the time that a Trust issues those trust preferred securities.
Each guarantee will be qualified as an indenture under the Trust Indenture Act.
Unless otherwise stated in a prospectus supplement, The First National Bank of
Chicago will act as indenture trustee under each guarantee for the purposes of
compliance with the Trust Indenture Act. The trustee will hold each guarantee
for the benefit of the holders of the preferred securities of the applicable
Trust.
We will agree, as described in each guarantee, to pay in full to the holders
of the trust preferred securities issued by the applicable Trust, the Guarantee
Payments, when and as due, regardless of any defense, right of set-off or
counterclaim which the Trust may have or assert. The following payments
("Guarantee Payments"), if not previously paid by a Trust, will be covered by
the applicable guarantee:
. any accumulated and unpaid distributions required to be paid on the
applicable trust preferred securities, if the Trust has funds available
to make the payment;
. the redemption price, if the Trust has funds available to make the
payment; and
. upon a voluntary or involuntary dissolution and winding up or
termination of the Trust, other than in connection with a distribution
of debt securities to holders of the applicable trust preferred
securities or the redemption of all the trust preferred securities, the
lesser of:
(1) the aggregate of the liquidation amount specified in the prospectus
supplement for each trust preferred security plus all accumulated
and unpaid distributions on the trust preferred securities to the
date of payment, if the Trust has funds available to make the
payment; and
(2) the amount of assets of the Trust remaining available for
distribution to holders of its trust preferred securities upon a
dissolution and termination of the Trust (either, a "Liquidation
Payment").
Our obligation to make a Guarantee Payment may be satisfied by directly
paying the required amounts to the holders of the trust preferred securities or
by causing the Trust to pay the amounts to the holders.
No single document executed by us relating to the issuance of trust
preferred securities will provide for a full, irrevocable and unconditional
guarantee of the trust preferred securities. It is only the combined operation
of our obligations under any indenture and the applicable guarantee and trust
declaration that has the effect of providing a full, irrevocable and
unconditional guarantee of a Trust's obligations under its trust preferred
securities.
Status of The Trust Preferred Securities Guarantees
Each guarantee will constitute an unsecured obligation of Torchmark and will
rank:
. subordinate and junior in right of payment to all of our other
liabilities, except those obligations made equal or junior to its
obligations under a guarantee;
. equal with the most senior preferred or preference stock now or
hereafter issued by us, and with any guarantee now or hereafter issued
by us in respect of any preferred or preference stock of any of our
affiliates; and
. senior to our common stock.
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Each trust declaration will require that the holder of trust preferred
securities accept the subordination provisions and other terms of the
guarantee. Each guarantee will constitute a guarantee of payment and not of
collection. In other words, the holder of the guaranteed security may sue us,
or seek other remedies, to enforce its rights under the guarantee without first
suing any other person or entity. A guarantee will not be discharged except:
. upon payment of the Guarantee Payments in full, if not previously paid;
. upon distribution of the underlying securities to the holders of trust
preferred securities upon any conversion or exchange of the holder's
trust preferred securities into the designated securities, if
applicable; or
. upon distribution to the applicable holders of trust preferred
securities of the corresponding series of debt securities under the
appropriate trust declaration.
Amendments and Assignment
Changes to the guarantee that do not adversely affect the rights of holders
of trust preferred securities in any material respect may be made without the
consent of those holders. Otherwise, a guarantee may only be amended with the
prior approval of the holders of at least a majority in aggregate liquidation
amount of the affected trust preferred securities, excluding any affected trust
preferred securities held by us or any of our affiliates. A description of the
way to obtain any approval is described under "Description of the Trust
Preferred Securities--Voting Rights; Amendment of Declarations." All guarantees
and agreements contained in the guarantee will be binding on our successors,
assigns, receivers, trustees and representatives and are for the benefit of the
holders of the applicable trust preferred securities.
Trust Preferred Securities Guarantee Events of Default
An event of default under a guarantee occurs if:
. we fail to make any of our required payments or perform our obligations
under the guarantee; or
. we fail to deliver the designated securities upon an appropriate
election by the holder of related trust preferred securities to convert
or exchange the trust preferred securities into the designated
securities, if applicable.
The holders of at least a majority in aggregate liquidation amount of the
trust preferred securities relating to each guarantee, excluding any trust
preferred securities held by us or any of our affiliates, will have the right
to direct the time, method and place of conducting any proceeding for any
remedy available to the trustee relating to that guarantee or to direct the
exercise of any Trust or power given to the trustee under the guarantee.
Information Concerning the Trust Preferred Guarantee Trustee
The trustee under a guarantee, other than during the occurrence and
continuation of a default under that guarantee, will only perform the duties
that are specifically described in the guarantee. Upon the occurrence of a
default, the trustee will exercise the same degree of care and skill as a
prudent person would exercise or use in the conduct of his or her own affairs.
A trustee is under no obligation to exercise any of its powers as described in
the applicable guarantee at the request of any holder of covered trust
preferred securities unless it is offered reasonable security and indemnity
against the costs, expenses and liabilities that it might incur.
Termination of the Trust Preferred Securities Guarantee
Each guarantee will terminate once the applicable trust preferred securities
are paid in full, upon distribution of the underlying securities to the holders
of trust preferred securities, upon any conversion or exchange of the holder's
trust preferred securities into the designated securities, if applicable, or
upon distribution of the corresponding series of debt securities to the holders
of the applicable trust preferred
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securities. Each guarantee will continue to be effective or will be reinstated
if at any time any holder of trust preferred securities issued by the
applicable Trust must restore payment of any sums paid under such trust
preferred securities or such guarantee.
Miscellaneous
Torchmark will pay all fees and expenses related to:
. the offering of the trust preferred securities and the junior
subordinated debentures;
. the organization, maintenance and dissolution of the Trusts;
. the retention of the trustees; and
. the enforcement by the property trustee of the rights of the holders of
the trust preferred securities.
Governing Law
The guarantees will be governed by and construed in accordance with the
laws of the State of New York.
RELATIONSHIP AMONG THE TRUST PREFERRED SECURITIES, THE TRUST PREFERRED
SECURITIES GUARANTEE AND THE DEBT SECURITIES HELD BY EACH TRUST
We will guarantee payments of distributions and redemption and liquidation
payments due on each series of the trust preferred securities, if the
applicable Trust has funds available for the payments, as described under
"Description of the Trust Preferred Securities Guarantees." No single document
executed by us in connection with the issuance of any series of the trust
preferred securities will provide for a full, irrevocable and unconditional
guarantee of any trust preferred securities. It is only the combined operation
of our obligations under the applicable guarantee, trust declaration and the
indenture that has the effect of providing a full, irrevocable and
unconditional guarantee of the Trust's obligations under its trust preferred
securities.
As long as we make payments of interest and other payments when due on the
debt securities held by a Trust, those payments will be sufficient to cover
the payment of distributions and redemption and liquidation payments due on
the trust preferred securities issued by that Trust, primarily because:
. the aggregate principal amount of the debt securities will be equal
to the sum of the aggregate liquidation amount of the trust preferred
and trust common securities;
. the interest rate and interest and other payment dates on the debt
securities will match the distribution rate and distribution and
other payment dates for the trust preferred securities;
. we will pay for any and all costs, expenses and liabilities of each
Trust, except such Trust's obligations under its trust preferred
securities; and
. each trust declaration provides that the related Trust will not
engage in any activity that is not consistent with the limited
purposes of the Trust.
If we do not make payments on the debt securities, the applicable Trust
will not have funds available to make payments of distributions or other
amounts due on its trust preferred securities. In those circumstances, you
will not be able to rely upon the guarantee for payment of these amounts.
Instead, you may directly sue us or seek other remedies to collect your
proportionate share of payments owed. If you sue us to collect payment, then
we will assume your rights as a holder of trust preferred securities under the
Trust's trust declaration if we make a payment to you in any legal action.
A holder of any trust preferred security may sue us, or seek other
remedies, to enforce its rights under the guarantee without first suing the
applicable trustee, the Trust that issued the trust preferred security or any
other person or entity.
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PLAN OF DISTRIBUTION
Torchmark may sell preferred stock, depositary shares or any series of debt
securities and a Trust may sell trust preferred securities in one or more of
the following ways from time to time:
. to underwriters or dealers for resale to the public or to institutional
investors;
. directly to institutional investors; or
. through agents to the public or to institutional investors.
The prospectus supplements will state the terms of the offering of the
securities, including:
. the name or names of any underwriters or agents;
. the purchase price of the securities;
. the proceeds to Torchmark or the applicable Trust, as the case may be,
from the sale;
. any underwriting discounts or agency fees and other items constituting
underwriters' or agents' compensation;
. any initial public offering price;
. any discounts or concessions allowed or reallowed or paid to dealers;
and
. any securities exchanges on which such securities may be listed.
If underwriters are used in the sale, the underwriters will acquire the
securities for their own account and may resell them from time to time in one
or more transactions, including negotiated transactions, at a fixed public
offering price or at varying prices determined at the time of sale.
If a dealer is used in the sale, we and/or a Trust, as the case may be, will
sell such securities to the dealer, as principal. The dealer may then resell
the securities to the public at varying prices to be determined by the dealer
at the time for resale.
Unless otherwise set forth in a prospectus supplement, there will be
conditions to the underwriters' obligations to purchase any series of
securities, and the underwriters will be obligated to purchase all of a series
of securities, if any are purchased.
Underwriters and agents may be entitled under agreements entered into with
us and/or a Trust to indemnification by us and/or a Trust against certain civil
liabilities, including liabilities under the Securities Act, or to contribution
concerning payments that the underwriters or agents may be required to make in
respect thereof. Underwriters and agents may be customers of, engage in
transactions with, or perform services for us and our affiliates in the
ordinary course of business.
Each of the securities issued hereunder will be a new issue of securities
and will have no prior trading market. Any underwriters to whom Torchmark or a
Trust sells securities for public offering and sale may make a market in the
securities, but no underwriter will be obligated to do so and may discontinue
any market making at any time without notice. The securities may or may not be
listed on a national securities exchange.
LEGAL OPINIONS
The validity of the securities being offered hereby is being passed upon for
Torchmark and each Trust by Maynard, Cooper & Gale, P.C., Birmingham, Alabama,
and with respect to certain matters of Delaware law relating to the validity of
the trust preferred securities, by Morris, Nichols, Arsht & Tunnell,
Wilmington, Delaware, special Delaware counsel to Torchmark and each Trust. If
any of the securities are issued in an underwritten offering, it is expected
that Davis Polk & Wardwell, New York, New York, will pass on certain legal
matters for the underwriters.
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EXPERTS
The consolidated financial statements incorporated in this prospectus by
reference from Torchmark's Annual Report on Form 10-K for the year ended
December 31, 1998, have been audited by KPMG Peat Marwick LLP, independent
auditors, as stated in their report incorporated in this prospectus by
reference, and have been so incorporated in reliance upon the report of such
firm given upon their authority as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We file reports, proxy statements, and other information with the SEC. You
can read and copy these reports, proxy statements, and other information
concerning Torchmark at the SEC's Public Reference Room at 450 Fifth Street,
N.W., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further
information on the Public Reference Room. The SEC maintains an internet site at
http://www.sec.gov that contains reports, proxy and information statements and
other information regarding issuers that file electronically with the SEC,
including Torchmark. Our common stock is listed on the New York Stock Exchange
and the International Stock Exchange in London, England. These reports, proxy
statements and other information are also available for inspection at the
offices of the National Association of Securities Dealers, Inc., Report
Section, 1735 K Street N.W., Washington, D.C. 20006.
This prospectus is part of a registration statement that we and the Trusts
filed with the SEC. You can obtain the full registration statement from the SEC
as indicated above, or from us.
The SEC allows us to "incorporate by reference" the information we file with
the SEC. This permits us to disclose important information to you by referring
to these filed documents. Any information referred to in this way is considered
part of this prospectus, and any information that we file with the SEC after
the date of this prospectus will automatically be deemed to update and
supersede this information. We incorporate by reference the following documents
that have been filed with the SEC:
. Annual Report on Form 10-K for the year ended December 31, 1998;
. Quarterly Report on Form 10-Q for the quarter ended March 31, 1999; and
. Quarterly Report on Form 10-Q/A for the quarter ended March 31, 1999.
We also incorporate by reference any future filings made with the SEC under
Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until
we file a post-effective amendment that indicates the termination of the
offering of the securities made by this prospectus.
We will provide without charge upon written or oral request a copy of any or
all of the documents that are incorporated by reference into this prospectus,
other than exhibits which are specifically incorporated by reference into such
documents. Requests should be directed to Investor Relations Department,
Torchmark Corporation, 2001 Third Avenue South, 16th Floor, Birmingham, Alabama
35233 (telephone (205) 325-4200).
There are no separate financial statements of the Trusts in this prospectus.
We do not believe such financial statements would be helpful because:
. The Trusts are subsidiaries of Torchmark, which files consolidated
financial information under the Exchange Act;
. The Trusts do not have any independent operations other than issuing
the preferred and common securities and purchasing our debt securities;
. The Trusts' only material assets will be our debt securities when
issued; and
. The combined obligations of Torchmark under the debt securities, the
Trust Preferred Securities Guarantees, the Declarations and the
Indenture have the effect of providing a full, irrevocable and
unconditional guarantee of the Trusts' obligations under their trust
preferred securities. See "Description of Debt Securities,"
"Description of the Trust Preferred Securities Guarantees" and
"Relationship Among the Trust Preferred Securities, the Trust Preferred
Securities Guarantee and the Debt Securities Held by Each Trust."
30
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth expenses in connection with the issuance and
distribution of the securities being registered. All amounts shown are
estimated, except the SEC Registration Fee.
<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee.............. $83,400
Transfer Agent Fees.............................................. *
Trustees of Depositary's Fees and Expenses....................... *
Rating Agency Fees............................................... *
Accounting Fees and Expenses..................................... *
Legal Fees and Expenses.......................................... *
Printing Expenses................................................ *
Miscellaneous.................................................... *
-------
Total........................................................... $ *
=======
</TABLE>
*To be provided by amendment.
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
Torchmark or its stockholders, (b) for acts of 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 indemnification is
II-1
<PAGE>
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 by ByLaws, 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 Underwriting Agreement*
4.1 Certificate of Trust of Torchmark Capital Trust I
4.2 Certificate of Trust of Torchmark Capital Trust II
4.3 Declaration of Trust of Torchmark Capital Trust I
4.4 Declaration of Trust of Torchmark Capital Trust II
4.5 Indenture Agreement dated February 1, 1987 between Torchmark and
Morgan Guaranty Trust Company of New York (as amended to appoint The
First National Bank of Chicago as successor trustee) (Incorporated by
reference from Exhibit 4(b) to Form S-3 of Torchmark Corporation
(Registration No. 33-11716))
4.6 Form of Amended and Restated Declaration of Trust of Torchmark Capital
Trust I and II*
4.7 Form of Junior Subordinated Indenture*
4.8 Form of Trust Preferred Security (included in Exhibit 4.6)*
4.9 Form of Preferred Securities Guarantee Agreement with respect to Trust
Preferred Securities to be issued by Torchmark Capital Trust I and II*
4.10 Form of Deposit Agreement*
4.11 Form of Depositary Share (included in Exhibit 4.10)*
5.1 Opinion of Maynard, Cooper & Gale, P.C. as to the validity of the
Preferred Stock, Debt Securities and Trust Preferred Securities
Guarantee*
5.2 Opinion of Morris, Nichols, Arsht & Tunnell as to the validity of the
Trust Preferred Securities*
8.1 Federal Income Tax Opinion of Maynard, Cooper & Gale, P.C.*
12.1 Statement re: Computation of Ratio of Earnings to Fixed Charges and
of Earnings to Combined Fixed Charges and Preferred Stock Dividends
of Torchmark
23.1 Consent of KPMG Peat Marwick LLP, Independent Auditors
23.2 Consent of Maynard, Cooper & Gale, P.C. (included in Exhibits 5.1 and
8.1)*
23.3 Consent of Morris, Nichols, Arsht & Tunnell (included in Exhibit
5.2)*
24.1 Powers of Attorney for certain officers and directors of Torchmark
25.1 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The First National Bank of Chicago, as Trustee
under the Indenture (Torchmark)
25.2 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The First National Bank of Chicago, as Trustee
under the Indenture (Torchmark Capital Trust I)
25.3 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The First National Bank of Chicago, as Trustee
under the Indenture (Torchmark Capital Trust II)
*To be filed by amendment
II-2
<PAGE>
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 the 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 the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20 percentage change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement;
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) do not apply if the
registration statement is on Form S-3 or Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrants pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") that are incorporated by
reference in the 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;
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of
the offering.
The undersigned registrants hereby undertake:
(a) That, for purposes of determining any liability under the Securities
Act, each filing of Torchmark's annual report pursuant to Section 13(a) or
Section 15(d) of the Exchange Act (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the Exchange
Act), that is incorporated by reference in this registration statement shall be
deemed to be a new registration statement relating to the securities offered
herein and the offering of such securities at the time shall be deemed to be
the initial bona fide offering hereof.
(b) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of any of
the registrants pursuant to the provisions referred to in Item 15 of this
registration statement, or otherwise, each of the registrants has been advised
that in the opinion of the Securities and Exchange 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 one of the registrants of
expenses incurred or paid by a director, officer or controlling registrant of
expenses incurred or paid by a director, officer or controlling person of one
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 hereby, each of 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.
II-3
<PAGE>
The undersigned registrants undertake that:
(1) For purposes of determining any liability under the Securities Act, the
information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in the form of
prospectus filed by the registrants pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities Act,
each post-effective amendment that contains a form of prospectus shall be
deemed to be a new registration statement relating the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering hereof.
The undersigned registrants hereby undertake to file an application for the
purpose of determining the eligibility of the trustee to act under subsection
(a) of Section 310 of the Trust Indenture Act in accordance with the rules and
regulations prescribed by the Commission under Section 305(b)(2) of the Act.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, Torchmark hereby
certifies that it has reasonable grounds to believe it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Birmingham, State of Alabama, on the 21st day of
July, 1999.
Torchmark Corporation
/s/ C. B. Hudson
By: _________________________________
C. B. Hudson
Chairman, President and Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ C. B. Hudson Chairman, President, Chief July 21, 1999
______________________________________ Executive, Officer, and
C. B. Hudson Director
* Vice President and Chief July 21, 1999
______________________________________ Accounting Officer
Gary L. Coleman (Principal Financial and
Accounting Officer)
* Director July 21, 1999
______________________________________
David L. Boren
* Director July 21, 1999
______________________________________
Joseph M. Farley
* Director July 21, 1999
______________________________________
Louis T. Hagopian
* Director July 21, 1999
______________________________________
Joseph L. Lanlier, Jr.
* Director July 21, 1999
______________________________________
Mark S. McAndrew
* Director July 21, 1999
______________________________________
Harold T. McCormick
* Director July 21, 1999
______________________________________
George J. Records
* Director July 21, 1999
______________________________________
</TABLE> R.K. Richey
/s/ Larry M. Hutchison
*By: ____________________________
Larry M. Hutchison
Attorney-in-fact
II-5
<PAGE>
EXHIBIT 4.1
CERTIFICATE OF TRUST
OF
TORCHMARK CAPITAL TRUST I
This Certificate of Trust is being duly executed as of July 21, 1999
for the purpose of organizing a business trust pursuant to the Delaware Business
Trust Act, 12 Del. C. (S)(S) 3801 et seq. (the "Act").
---- -- -- ---
The undersigned hereby certify as follows:
1. Name. The name of the business trust is Torchmark Capital Trust
----
I (the "Trust").
2. Delaware Trustee. The name and business address of the Delaware
----------------
resident trustee of the Trust meeting the requirements of Section 3807 of the
Act are as follows:
Bank One Delaware, Inc.
Three Christiana Center
201 North Walnut Street
Wilmington, Delaware 19801
3. Effective. This Certificate of Trust shall be effective
---------
immediately upon filing in the Office of the Secretary of State of the State of
Delaware.
4. Counterparts. This Certificate of Trust may be executed in one
------------
or more counterparts.
-1-
<PAGE>
IN WITNESS WHEREOF, the undersigned, being all of the trustees of the
Trust, have duly executed this Certificate of Trust as of the day and year first
above written.
BANK ONE DELAWARE, INC.,
as Delaware Trustee
By: /s/ Sandra L. Caruba
---------------------------
Name: Sandra L. Caruba
Title: Vice President
/s/ Michael Klyce
---------------------------
Michael Klyce, as Trustee
/s/ Larry Hutchison
---------------------------
Larry Hutchison, as Trustee
/s/ Gary Coleman
---------------------------
Gary Coleman, as Trustee
-2-
<PAGE>
EXHIBIT 4.2
CERTIFICATE OF TRUST
OF
TORCHMARK CAPITAL TRUST II
This Certificate of Trust is being duly executed as of July 21, 1999
for the purpose of organizing a business trust pursuant to the Delaware Business
Trust Act, 12 Del. C. (S)(S) 3801 et seq. (the "Act").
---- -- -- ---
The undersigned hereby certify as follows:
1. Name. The name of the business trust is Torchmark Capital Trust
----
II (the "Trust").
2. Delaware Trustee. The name and business address of the Delaware
----------------
resident trustee of the Trust meeting the requirements of Section 3807 of the
Act are as follows:
Bank One Delaware, Inc.
Three Christiana Center
201 North Walnut Street
Wilmington, Delaware 19801
3. Effective. This Certificate of Trust shall be effective
---------
immediately upon filing in the Office of the Secretary of State of the State of
Delaware.
4. Counterparts. This Certificate of Trust may be executed in one
------------
or more counterparts.
-1-
<PAGE>
IN WITNESS WHEREOF, the undersigned, being all of the trustees of the
Trust, have duly executed this Certificate of Trust as of the day and year first
above written.
BANK ONE DELAWARE, INC.,
as Delaware Trustee
By: /s/ Sandra L. Caruba
---------------------------
Name: Sandra L. Caruba
Title: Vice President
/s/ Michael Klyce
----------------------------
Michael Klyce, as Trustee
/s/ Larry Hutchison
----------------------------
Larry Hutchison, as Trustee
/s/ Gary Coleman
----------------------------
Gary Coleman, as Trustee
-2-
<PAGE>
EXHIBIT 4.3
DECLARATION OF TRUST
--------------------
DECLARATION OF TRUST, dated as of July 21, 1999, between Torchmark
Corporation, a Delaware corporation, as Sponsor, Bank One Delaware, Inc., a
Delaware corporation, as Delaware Trustee, and Michael Klyce, Larry
Hutchinson and Gary Coleman, as Regular Trustees (collectively with the Delaware
Trustee, the "Trustees"). The Sponsor and the Trustees hereby agree as follows:
1. The trust created hereby (the "Trust") shall be known as
"Torchmark Capital Trust I", in which name the Trustees, or the Sponsor to the
extent provided herein, may conduct the business of the Trust, make and execute
contracts, and sue and be sued.
2. The Sponsor hereby assigns, transfers, conveys and sets over to
the Trust the sum of $10. The Trustees hereby acknowledge receipt of such
amount from the Sponsor, which amount shall constitute the initial
trust estate. The Trustees hereby declare that they will hold the trust estate
for the Sponsor. It is the intention of the parties hereto that the
Trust created hereby constitute a business trust under Chapter 38 of Title 12 of
the Delaware Code, 12 Del. C. (S)(S) 3801 et seq. (the "Business Trust Act"),
---- -- -- ----
and that this document constitute the governing instrument of the Trust. The
Trustees are hereby authorized and directed to execute and file a certificate of
trust in the office of the Secretary of State of the State of Delaware in the
form attached hereto. The Trust is hereby established by the Sponsor and the
Trustees for the purposes of (i) issuing preferred securities ("Preferred
Securities") representing undivided beneficial interests in the assets of the
Trust in exchange for cash and investing the proceeds thereof in debt securities
of the Sponsor, (ii) issuing and selling common securities ("Common Securities"
and, together with the Preferred Securities, "Trust Securities") representing
undivided beneficial interests in the assets of the Trust to the Sponsor in
exchange for cash and investing the proceeds thereof in additional debt
securities of the Sponsor and (iii) engaging in such other activities as are
necessary, convenient or incidental thereto.
3. Concurrent with the first issuance of any Trust Securities
by the Trust, the Sponsor and the Trustees intend to enter into an amended and
restated Declaration of Trust, satisfactory to each such party and substantially
in the form to be included as an exhibit to the 1933 Act Registration Statement
referred to below at the time such registration statement becomes effective
under the Securities Act of 1933, as amended (the "Securities Act"), to provide
for the contemplated operation of the Trust created hereby and the issuance of
the Preferred Securities and the Common Securities referred to therein. Prior to
the execution and delivery of such amended and restated Declaration of Trust,
the Trustees shall not have any duty or obligation hereunder or with respect to
the trust estate, except as otherwise required by applicable law or as may be
necessary to obtain, prior to such execution and delivery, any licenses,
consents or approvals required by applicable law or otherwise.
-1-
<PAGE>
4. The Sponsor and the Trustees hereby authorize and direct the
Sponsor, as the sponsor of the Trust, as applicable, (i) to prepare and file
with the Securities and Exchange Commission (the "Commission") and execute, in
each case on behalf of the Trust, (a) a Registration Statement on Form S-3 (the
"1933 Act Registration Statement"), including any pre-effective or post-
effective amendments to such Registration Statement, relating to the
registration of the Preferred Securities under the Securities Act and (b) a
Registration Statement on Form 8-A (the "1934 Act Registration Statement")
(including any pre-effective or post-effective amendments thereto) relating to
the registration of the Preferred Securities under Section 12(b) of the
Securities Exchange Act of 1934, as amended; (ii) to prepare and file with the
New York Stock Exchange and execute a listing application and all other
applications, statements, certificates, agreements and other instruments as
shall be necessary or desirable to cause the Preferred Securities to be listed
on the New York Stock Exchange; (iii) to prepare and file and execute, in each
case on behalf of the Trust, such applications, reports, surety bonds,
irrevocable consents, appointments of attorney for service of process and other
papers and documents as shall be necessary or desirable to register the
Preferred Securities under the securities or "blue sky" laws of such
jurisdictions as the Sponsor, on behalf of the Trust, may deem necessary or
desirable; and (iv) to negotiate the terms of, and execute on behalf of the
Trust, an underwriting agreement among the Trust, the Sponsor and any
underwriter, dealer or agent relating to the Preferred Securities, substantially
in the form to be included as an exhibit to, or incorporated by reference in,
the 1933 Act Registration Statement. It is hereby acknowledged and agreed that
in connection with any execution, filing or document referred to in clauses (i)-
(iii) above, (A) any Regular Trustee (or his attorneys-in-fact and agents or the
Sponsor as permitted herein) is authorized on behalf of the Trust to file and
execute such document on behalf of the Trust and (B) the Delaware Trustee shall
not be required to join in any such filing or execute on behalf of the Trust any
such document unless required by the rules and regulations of the Commission or
the New York Stock Exchange or state securities or blue sky laws, and in such
case only to the extent so required. In connection with all of the foregoing,
the Sponsor and each Regular Trustee, solely in its capacity as Trustee of the
Trust, hereby constitutes and appoints Michael Klyce, Larry Hutchinson and Gary
Coleman, and each of them, his, her or its, as the case may be, true and lawful
attorneys-in-fact, and agents, with full power of substitution and
resubstitution, for the Sponsor or such Trustee and in the Sponsor's or such
Trustee's name, place and stead, in any and all capacities, to sign and file (i)
the 1933 Act Registration Statement and the 1934 Act Registration Statement and
any and all amendments (including post-effective amendments) or supplements
thereto, with all exhibits thereto, and other documents in connection therewith,
and (ii) a registration statement and any and all amendments thereto filed
pursuant to Rule 462(b) under the Securities Act with the Commission, granting
unto said attorneys-in-fact and agents full power and authority to do and
perform each and every act and thing and authority to do and perform each and
every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as the Sponsor or such Trustee might or
could do in person, hereby ratifying and confirming all that said attorneys-in-
fact and agents or any of them, or their or his or her substitute or
substitutes, shall do or cause to be done by virtue hereof.
5. This Declaration of Trust may be executed in one or more
counterparts.
-2-
<PAGE>
6. The number of Trustees initially shall be four (4) and thereafter
the number of Trustees shall be such number as shall be fixed from time to time
by a written instrument signed by the Sponsor which may increase or decrease the
number of Trustees; provided, however, that the number of Trustees shall in no
event be less than four (4); and provided, further, however, that to the extent
required by the Business Trust Act, one Trustee shall either be a natural person
who is a resident of the State of Delaware or, if not a natural person, an
entity that has its principal place of business in the State of Delaware and
meets any other requirements imposed by applicable law. Subject to the
foregoing, the Sponsor is entitled to appoint or remove without cause any
Trustee at any time. Any Trustee may resign upon thirty days prior notice to the
Sponsor; provided, however, that the Delaware Trustee may resign immediately
upon notice to the Sponsor if the Delaware Trustee is required to join in any
filing or execute on behalf of the Trust any document pursuant to the provisions
of paragraph 4 hereof and, upon giving such notice, the Delaware Trustee shall
not be required to join in any such filing or execute on behalf of the Trust any
such document; provided, further, however, that no resignation of the Delaware
Trustee shall be effective until a successor Delaware Trustee has been appointed
and has accepted such appointment by instrument executed by such successor
Delaware Trustee and delivered to the Trust, the Sponsor and the resigning
Delaware Trustee.
7. To the fullest extent permitted by applicable law, the Sponsor
agrees to indemnify (i) the Delaware Trustee, (ii) any affiliate of the Delaware
Trustee, and (iii) any officers, directors, shareholders, members, partners,
employees, representatives, nominees, custodians or agents of the Delaware
Trustee (each of the persons or entities in (i) through (iii) being referred to
as an "Indemnified Person") for, and to hold each Indemnified Person harmless
against, any loss, liability or expense incurred without negligence or bad faith
on its part, arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder, including the costs and
expenses (including reasonable legal fees and expenses) of defending itself
against, or investigating, any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. The obligation
to indemnify as set forth in this paragraph 7 shall survive the termination of
this Declaration. The Delaware Trustee shall not have any of the powers or
duties set forth herein, except as required under the Business Trust Act. The
Delaware Trustee shall be a trustee hereunder for the sole and limited purpose
of fulfilling the requirements of Section 3807(a) of the Business Trust Act.
8. The Trust may terminate without issuing any Trust Securities at
the election of the Sponsor.
9. This Declaration shall be governed by the laws of the State of
Delaware, without regard to conflict of laws principles.
-3-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Declaration of
Trust to be duly executed as of the day and year first above written.
TORCHMARK CORPORATION, as Sponsor
By: /s/ Michael J. Klyce
-----------------------------------
Name: Michael J. Klyce
Title: Vice President and Treasurer
BANK ONE DELAWARE, INC.,
as Delaware Trustee
By: /s/ Sandra L. Caruba
-----------------------------------
Name: Sandra L. Caruba
Title: Vice President
/s/ Michael Klyce
-----------------------------------
Michael Klyce, as Trustee
Larry Hutchison
-----------------------------------
Larry Hutchison, as Trustee
/s/ Gary Coleman
-----------------------------------
Gary Coleman, as Trustee
-4-
<PAGE>
EXHIBIT 4.4
DECLARATION OF TRUST
--------------------
DECLARATION OF TRUST, dated as of July 21, 1999, between Torchmark
Corporation, a Delaware corporation, as Sponsor, Bank One Delaware, Inc., a
Delaware corporation, as Delaware Trustee, and Michael Klyce, Larry Hutchinson
and Gary Coleman, as Regular Trustees (collectively with the Delaware Trustee,
the "Trustees"). The Sponsor and the Trustees hereby agree as follows:
1. The trust created hereby (the "Trust") shall be known as "Torchmark
Capital Trust II", in which name the Trustees, or the Sponsor to the extent
provided herein, may conduct the business of the Trust, make and execute
contracts, and sue and be sued.
2. The Sponsor hereby assigns, transfers, conveys and sets over to the
Trust the sum of $10. The Trustees hereby acknowledge receipt of such amount
from the Sponsor, which amount shall constitute the initial trust estate. The
Trustees hereby declare that they will hold the trust estate for the Sponsor. It
is the intention of the parties hereto that the Trust created hereby constitute
a business trust under Chapter 38 of Title 12 of the Delaware Code, 12 Del. C.
---- --
(S)(S) 3801 et seq. (the "Business Trust Act"), and that this document
-- ----
constitute the governing instrument of the Trust. The Trustees are hereby
authorized and directed to execute and file a certificate of trust in the office
of the Secretary of State of the State of Delaware in the form attached hereto.
The Trust is hereby established by the Sponsor and the Trustees for the purposes
of (i) issuing preferred securities ("Preferred Securities") representing
undivided beneficial interests in the assets of the Trust in exchange for cash
and investing the proceeds thereof in debt securities of the Sponsor, (ii)
issuing and selling common securities ("Common Securities" and, together with
the Preferred Securities, "Trust Securities") representing undivided beneficial
interests in the assets of the Trust to the Sponsor in exchange for cash and
investing the proceeds thereof in additional debt securities of the Sponsor and
(iii) engaging in such other activities as are necessary, convenient or
incidental thereto.
3. Concurrent with the first issuance of any Trust Securities by the
Trust, the Sponsor and the Trustees intend to enter into an amended and restated
Declaration of Trust, satisfactory to each such party and substantially in the
form to be included as an exhibit to the 1933 Act Registration Statement
referred to below at the time such registration statement becomes effective
under the Securities Act of 1933, as amended (the "Securities Act"), to provide
for the contemplated operation of the Trust created hereby and the issuance of
the Preferred Securities and the Common Securities referred to therein. Prior to
the execution and delivery of such amended and restated Declaration of Trust,
the Trustees shall not have any duty or obligation hereunder or with respect to
the trust estate, except as otherwise required by applicable law or as may be
necessary to obtain, prior to such execution and delivery, any licenses,
consents or approvals required by applicable law or otherwise.
-1-
<PAGE>
4. The Sponsor and the Trustees hereby authorize and direct the
Sponsor, as the sponsor of the Trust, as applicable, (i) to prepare and file
with the Securities and Exchange Commission (the "Commission") and execute, in
each case on behalf of the Trust, (a) a Registration Statement on Form S-3 (the
"1933 Act Registration Statement"), including any pre-effective or post-
effective amendments to such Registration Statement, relating to the
registration of the Preferred Securities under the Securities Act and (b) a
Registration Statement on Form 8-A (the "1934 Act Registration Statement")
(including any pre-effective or post-effective amendments thereto) relating to
the registration of the Preferred Securities under Section 12(b) of the
Securities Exchange Act of 1934, as amended; (ii) to prepare and file with the
New York Stock Exchange and execute a listing application and all other
applications, statements, certificates, agreements and other instruments as
shall be necessary or desirable to cause the Preferred Securities to be listed
on the New York Stock Exchange; (iii) to prepare and file and execute, in each
case on behalf of the Trust, such applications, reports, surety bonds,
irrevocable consents, appointments of attorney for service of process and other
papers and documents as shall be necessary or desirable to register the
Preferred Securities under the securities or "blue sky" laws of such
jurisdictions as the Sponsor, on behalf of the Trust, may deem necessary or
desirable; and (iv) to negotiate the terms of, and execute on behalf of the
Trust, an underwriting agreement among the Trust, the Sponsor and any
underwriter, dealer or agent relating to the Preferred Securities, substantially
in the form to be included as an exhibit to, or incorporated by reference in,
the 1933 Act Registration Statement. It is hereby acknowledged and agreed that
in connection with any execution, filing or document referred to in clauses (i)-
(iii) above, (A) any Regular Trustee (or his attorneys-in-fact and agents or the
Sponsor as permitted herein) is authorized on behalf of the Trust to file and
execute such document on behalf of the Trust and (B) the Delaware Trustee shall
not be required to join in any such filing or execute on behalf of the Trust any
such document unless required by the rules and regulations of the Commission or
the New York Stock Exchange or state securities or blue sky laws, and in such
case only to the extent so required. In connection with all of the foregoing,
the Sponsor and each Regular Trustee, solely in its capacity as Trustee of the
Trust, hereby constitutes and appoints Michael Klyce, Larry Hutchinson and Gary
Coleman, and each of them, his, her or its, as the case may be, true and lawful
attorneys-in-fact, and agents, with full power of substitution and
resubstitution, for the Sponsor or such Trustee and in the Sponsor's or such
Trustee's name, place and stead, in any and all capacities, to sign and file (i)
the 1933 Act Registration Statement and the 1934 Act Registration Statement and
any and all amendments (including post-effective amendments) or supplements
thereto, with all exhibits thereto, and other documents in connection therewith,
and (ii) a registration statement and any and all amendments thereto filed
pursuant to Rule 462(b) under the Securities Act with the Commission, granting
unto said attorneys-in-fact and agents full power and authority to do and
perform each and every act and thing and authority to do and perform each and
every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as the Sponsor or such Trustee might or
could do in person, hereby ratifying and confirming all that said attorneys-in-
fact and agents or any of them, or their or his or her substitute or
substitutes, shall do or cause to be done by virtue hereof.
5. This Declaration of Trust may be executed in one or more
counterparts.
-2-
<PAGE>
6. The number of Trustees initially shall be four (4) and thereafter
the number of Trustees shall be such number as shall be fixed from time to time
by a written instrument signed by the Sponsor which may increase or decrease the
number of Trustees; provided, however, that the number of Trustees shall in no
event be less than four (4); and provided, further, however, that to the extent
required by the Business Trust Act, one Trustee shall either be a natural person
who is a resident of the State of Delaware or, if not a natural person, an
entity that has its principal place of business in the State of Delaware and
meets any other requirements imposed by applicable law. Subject to the
foregoing, the Sponsor is entitled to appoint or remove without cause any
Trustee at any time. Any Trustee may resign upon thirty days prior notice to the
Sponsor; provided, however, that the Delaware Trustee may resign immediately
upon notice to the Sponsor if the Delaware Trustee is required to join in any
filing or execute on behalf of the Trust any document pursuant to the provisions
of paragraph 4 hereof and, upon giving such notice, the Delaware Trustee shall
not be required to join in any such filing or execute on behalf of the Trust any
such document; provided, further, however, that no resignation of the Delaware
Trustee shall be effective until a successor Delaware Trustee has been appointed
and has accepted such appointment by instrument executed by such successor
Delaware Trustee and delivered to the Trust, the Sponsor and the resigning
Delaware Trustee.
7. To the fullest extent permitted by applicable law, the Sponsor
agrees to indemnify (i) the Delaware Trustee, (ii) any affiliate of the Delaware
Trustee, and (iii) any officers, directors, shareholders, members, partners,
employees, representatives, nominees, custodians or agents of the Delaware
Trustee (each of the persons or entities in (i) through (iii) being referred to
as an "Indemnified Person") for, and to hold each Indemnified Person harmless
against, any loss, liability or expense incurred without negligence or bad faith
on its part, arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder, including the costs and
expenses (including reasonable legal fees and expenses) of defending itself
against, or investigating, any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. The obligation
to indemnify as set forth in this paragraph 7 shall survive the termination of
this Declaration. The Delaware Trustee shall not have any of the powers or
duties set forth herein, except as required under the Business Trust Act. The
Delaware Trustee shall be a trustee hereunder for the sole and limited purpose
of fulfilling the requirements of Section 3807(a) of the Business Trust Act.
8. The Trust may terminate without issuing any Trust Securities at
the election of the Sponsor.
9. This Declaration shall be governed by the laws of the State of
Delaware, without regard to conflict of laws principles.
-3-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Declaration of
Trust to be duly executed as of the day and year first above written.
TORCHMARK CORPORATION, as Sponsor
By: /s/ Michael J. Klyce
--------------------
Name: Michael J. Klyce
Title: Vice President and Treasurer
BANK ONE DELAWARE, INC.,
as Delaware Trustee
By: /s/ Sandra L. Caruba
--------------------
Name: Sandra L. Caruba
Title: Vice President
/s/ Michael Klyce
-------------------------
Michael Klyce, as Trustee
/s/ Larry Hutchison
---------------------------
Larry Hutchison, as Trustee
/s/ Gary Coleman
------------------------
Gary Coleman, as Trustee
-4-
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT 12.1
COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES
3 months
1994 1995 1996 1997 1998 1999
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Earnings:
Pre-tax earnings 313,691 339,322 387,492 391,999 446,991 129,681
Fixed charges
and MIPS dividends 81,244 99,687 91,056 89,843 74,753 16,456
Less: interest capitalized
included above (1,299) (1,596) (1,361) (1,663) (2,437) (120)
-------- -------- -------- -------- -------- --------
Earnings before fixed charges 393,636 437,413 477,187 480,179 519,307 146,017
======== ======== ======== ======== ======== ========
Fixed charges and MIPS dividends:
Interest expense 75,922 80,994 73,611 71,863 56,325 12,576
Capitalized interest 1,299 1,596 1,361 1,663 2,437 120
Adjusted MIPS dividends 3,192 16,159 15,036 15,265 14,933 3,466
Estimated interest factor of
rental expense 831 938 1,048 1,052 1,058 294
-------- -------- -------- -------- -------- --------
Total fixed charges 81,244 99,687 91,056 89,843 74,753 16,456
======== ======== ======== ======== ======== ========
Ratio of earnings to fixed charges
and MIPS dividends 4.8 4.4 5.2 5.3 6.9 8.9
======== ======== ======== ======== ======== ========
Earnings before fixed charges 393,636 437,413 477,187 480,179 519,307 146,017
Interest credited for deposit
products 65,243 88,066 94,900 98,563 86,561 22,533
-------- -------- -------- -------- -------- --------
Adjusted earnings before fixed charges 458,879 525,479 572,087 578,742 605,868 168,550
======== ======== ======== ======== ======== ========
Fixed charges 81,244 99,687 91,056 89,843 74,753 16,456
Interest credited for deposit products 65,243 88,066 94,900 98,563 86,561 22,533
-------- -------- -------- -------- -------- --------
Adjusted fixed charges 146,487 187,753 185,956 188,406 161,314 38,989
======== ======== ======== ======== ======== ========
Ratio of earnings to fixed charges
and MIPS dividends
including interest credited on deposit
products as a fixed charge 3.1 2.8 3.1 3.1 3.8 4.3
======== ======== ======== ======== ======== ========
Rental expense 2,520 2,843 3,177 3,189 3,206 890
Estimated interest factor
of rental expense (33%) 831 938 1,048 1,052 1,058 294
Interest credited on deposit products 65,243 88,066 94,900 98,563 86,561 22,533
MIPS dividends 2,137 10,317 9,655 9,875 9,777 2,289
Tax rate 33.0% 36.2% 35.8% 35.3% 34.5% 34.0%
Adjusted (pretax) MIPS dividends 3,192 16,159 15,036 15,265 14,933 3,466
</TABLE>
<PAGE>
Exhibit 23.1
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 LLP
Birmingham, Alabama
July 21, 1999
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director of Torchmark Corporation (the "Company")
constitutes and appoints Michael J. Klyce, Gary L. Coleman, Larry M. Hutchison
and Carol A. McCoy, and each of them severally, his true and lawful attorneys-
in-fact for him and in his name, place and stead, in any and all capacities, to
sign the Form S-3 Registration Statement for preferred stock, depository shares,
and debt securities of the Company and trust preferred securities guaranteed by
the Company and any and all amendments and post-effective amendments thereto,
and to file the same with all exhibits thereto and other documents required in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all said attorneys-in-fact and agents or any of them or
their substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ David L. Boren
------------------------------------
David L. Boren
Director
Date: July 21, 1999
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director of Torchmark Corporation (the "Company")
constitutes and appoints Michael J. Klyce, Gary L. Coleman, Larry M. Hutchison
and Carol A. McCoy, and each of them severally, his true and lawful attorneys-
in-fact for him and in his name, place and stead, in any and all capacities, to
sign the Form S-3 Registration Statement for preferred stock, depository shares,
and debt securities of the Company and trust preferred securities guaranteed by
the Company and any and all amendments and post-effective amendments thereto,
and to file the same with all exhibits thereto and other documents required in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all said attorneys-in-fact and agents or any of them or
their substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ Joseph M. Farley
------------------------------------
Joseph M. Farley
Director
Date: July 16, 1999
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director of Torchmark Corporation (the "Company")
constitutes and appoints Michael J. Klyce, Gary L. Coleman, Larry M. Hutchison
and Carol A. McCoy, and each of them severally, his true and lawful attorneys-
in-fact for him and in his name, place and stead, in any and all capacities, to
sign the Form S-3 Registration Statement for preferred stock, depository shares,
and debt securities of the Company and trust preferred securities guaranteed by
the Company and any and all amendments and post-effective amendments thereto,
and to file the same with all exhibits thereto and other documents required in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all said attorneys-in-fact and agents or any of them or
their substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ Louis T. Hagopian
------------------------------------
Louis T. Hagopian
Director
Date: July 21, 1999
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director of Torchmark Corporation (the "Company")
constitutes and appoints Michael J. Klyce, Gary L. Coleman, Larry M. Hutchison
and Carol A. McCoy, and each of them severally, his true and lawful attorneys-
in-fact for him and in his name, place and stead, in any and all capacities, to
sign the Form S-3 Registration Statement for preferred stock, depository shares,
and debt securities of the Company and trust preferred securities guaranteed by
the Company and any and all amendments and post-effective amendments thereto,
and to file the same with all exhibits thereto and other documents required in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all said attorneys-in-fact and agents or any of them or
their substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ Joseph L. Lanier, Jr.
------------------------------------
Joseph L. Lanier, Jr.
Director
Date: July 21, 1999
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director of Torchmark Corporation (the "Company")
constitutes and appoints Michael J. Klyce, Gary L. Coleman, Larry M. Hutchison
and Carol A. McCoy, and each of them severally, his true and lawful attorneys-
in-fact for him and in his name, place and stead, in any and all capacities, to
sign the Form S-3 Registration Statement for preferred stock, depository shares,
and debt securities of the Company and trust preferred securities guaranteed by
the Company and any and all amendments and post-effective amendments thereto,
and to file the same with all exhibits thereto and other documents required in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all said attorneys-in-fact and agents or any of them or
their substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ Mark S. McAndrew
------------------------------------
Mark S. McAndrew
Director
Date: July 21, 1999
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director of Torchmark Corporation (the "Company")
constitutes and appoints Michael J. Klyce, Gary L. Coleman, Larry M. Hutchison
and Carol A. McCoy, and each of them severally, his true and lawful attorneys-
in-fact for him and in his name, place and stead, in any and all capacities, to
sign the Form S-3 Registration Statement for preferred stock, depository shares,
and debt securities of the Company and trust preferred securities guaranteed by
the Company and any and all amendments and post-effective amendments thereto,
and to file the same with all exhibits thereto and other documents required in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all said attorneys-in-fact and agents or any of them or
their substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ Harold T. McCormick
------------------------------------
Harold T. McCormick
Director
Date: July 21, 1999
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director of Torchmark Corporation (the "Company")
constitutes and appoints Michael J. Klyce, Gary L. Coleman, Larry M. Hutchison
and Carol A. McCoy, and each of them severally, his true and lawful attorneys-
in-fact for him and in his name, place and stead, in any and all capacities, to
sign the Form S-3 Registration Statement for preferred stock, depository shares,
and debt securities of the Company and trust preferred securities guaranteed by
the Company and any and all amendments and post-effective amendments thereto,
and to file the same with all exhibits thereto and other documents required in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all said attorneys-in-fact and agents or any of them or
their substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ George J. Records
------------------------------------
George J. Records
Director
Date: July 21, 1999
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director of Torchmark Corporation (the "Company")
constitutes and appoints Michael J. Klyce, Gary L. Coleman, Larry M. Hutchison
and Carol A. McCoy, and each of them severally, his true and lawful attorneys-
in-fact for him and in his name, place and stead, in any and all capacities, to
sign the Form S-3 Registration Statement for preferred stock, depository shares,
and debt securities of the Company and trust preferred securities guaranteed by
the Company and any and all amendments and post-effective amendments thereto,
and to file the same with all exhibits thereto and other documents required in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all said attorneys-in-fact and agents or any of them or
their substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ R. K. Richey
------------------------------------
R. K. Richey
Director
Date: July 21, 1999
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned officer and director of Torchmark Corporation (the
"Company") constitutes and appoints Michael J. Klyce, Gary L. Coleman, Larry M.
Hutchison and Carol A. McCoy, and each of them severally, his true and lawful
attorneys-in-fact for him and in his name, place and stead, in any and all
capacities, to sign the Form S-3 Registration Statement for preferred stock,
depository shares, and debt securities of the Company and trust preferred
securities guaranteed by the Company and any and all amendments and post-
effective amendments thereto, and to file the same with all exhibits thereto and
other documents required in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and agents, and each
of them, full power and authority to do and perform each and every act and thing
requisite and necessary to be done as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all said attorneys-
in-fact and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ C.B. Hudson
------------------------------------
C.B. Hudson
Chairman, President and Chief
Executive Officer and Director
(Principal Financial Officer)
Date: July 21, 1999
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned officer of Torchmark Corporation (the "Company")
constitutes and appoints Michael J. Klyce, Larry M. Hutchison and Carol A.
McCoy, and each of them severally, his true and lawful attorneys-in-fact for him
and in his name, place and stead, in any and all capacities, to sign the Form S-
3 Registration Statement for preferred stock, depository shares, and debt
securities of the Company and trust preferred securities guaranteed by the
Company and any and all amendments and post-effective amendments thereto, and to
file the same with all exhibits thereto and other documents required in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all said attorneys-in-fact and agents or any of them or
their substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ Gary L. Coleman
------------------------------------
Gary L. Coleman
Vice President and Chief
Accounting Officer
Date: July 21, 1999
<PAGE>
EXHIBIT 25.1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)
___
--------------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
--------------------
TORCHMARK CORPORATION
(Exact name of obligor as specified in its charter)
Delaware 63-0780404
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
2001 Third Avenue South
Birmingham, Alabama 35233
(Address of principal executive offices) (Zip Code)
Debt Securities
Guarantee of Preferred Securities of
Torchmark Capital Trust I and Torchmark Capital Trust II
(Title of Indenture Securities)
<PAGE>
Item 1. General Information. Furnish the following
--------------------
information as to the trustee:
(a) Name and address of each examining or
supervising authority to which it is subject.
Comptroller of Currency, Washington, D.C.;
Federal Deposit Insurance Corporation,
Washington, D.C.; The Board of Governors of
the Federal Reserve System, Washington D.C..
(b) Whether it is authorized to exercise
corporate trust powers.
The trustee is authorized to exercise corporate
trust powers.
Item 2. Affiliations With the Obligor. If the obligor
------------------------------
is an affiliate of the trustee, describe each
such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a
-----------------
part of this Statement of Eligibility.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 12th day of July, 1999.
The First National Bank of Chicago,
Trustee
By /s/ Sandra L. Caruba
----------------------------------
Sandra L. Caruba
Vice President
* Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 16 of the Form T-1 of The First National Bank
of Chicago, filed as Exhibit 25 to the Registration Statement on Form S-3 of U S
WEST Capital Funding, Inc., filed with the Securities and Exchange Commission on
May 6, 1998 (Registration No. 333-51907-01).
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
July 12, 1999
Securities and Exchange Commission
Washington, D.C. 20549
Ladies and Gentlemen:
In connection with the qualification of the Indenture by and between Torchmark
Corporation and The First National Bank of Chicago, as Trustee, the undersigned,
in accordance with Section 321(b) of the Trust Indenture Act of 1939, as
amended, hereby consents that the reports of examinations of the undersigned,
made by Federal or State authorities authorized to make such examinations, may
be furnished by such authorities to the Securities and Exchange Commission upon
its request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ Sandra L. Caruba
---------------------------------
Sandra L. Caruba
Vice President
<PAGE>
EXHIBIT 7
<TABLE>
<CAPTION>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/99 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for March 31, 1999
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC-Balance Sheet
<TABLE>
<CAPTION>
Dollar Amounts in thousands C400
------
RCFD BIL MIL THOU
---- ----------------
<S> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A): RCFD
----
a. Noninterest-bearing balances and currency and coin(1)........... 0081 3,809,517
1.a
b. Interest-bearing balances(2).................................... 0071 4,072,166
1.b
2. Securities
a. Held-to-maturity securities (from Schedule RC-B, column A)...... 1754 0
2.a
b. Available-for-sale securities (from Schedule RC-B, column D).... 1773 12,885,728
2.b
3. Federal funds sold and securities purchased under agreements to
resell............................................................. 1350 4,684,756
3.
4. Loans and lease financing receivables: RCFD
a. Loans and leases, net of unearned income (from Schedule ----
RC-C)............................................................ 2122 34,304,806 4.a
b. LESS: Allowance for loan and lease losses........................ 3123 411,476 4.b
c. LESS: Allocated transfer risk reserve............................ 3128 3,884 4.c
RCFD
d. Loans and leases, net of unearned income, allowance, and ----
reserve (item 4.a minus 4.b and 4.c)............................. 2125 33,889,446
4.d
5. Trading assets (from Schedule RD-D)................................. 3545 5,100,499
5.
6. Premises and fixed assets (including capitalized leases)............ 2145 754,052
6.
7. Other real estate owned (from Schedule RC-M)........................ 2150 5,244
7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)...................................... 2130 201,068
8.
9. Customers' liability to this bank on acceptances outstanding........ 2155 265,041
9.
10. Intangible assets (from Schedule RC-M).............................. 2143 285,709 10.
11. Other assets (from Schedule RC-F)................................... 2160 2,987,184 11.
12. Total assets (sum of items 1 through 11)............................ 2170 68,940,410 12.
- ------------------
</TABLE>
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
EXHIBIT 25.2
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)
___
--------------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
--------------------
TORCHMARK CAPITAL TRUST II
(Exact name of obligor as specified in its charter)
Delaware To be applied for
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
2001 Third Avenue South
Birmingham, Alabama 35233
(Address of principal executive offices) (Zip Code)
Preferred Securities
(Title of Indenture Securities)
<PAGE>
Item 1. General Information. Furnish the following
--------------------
information as to the trustee:
(a) Name and address of each examining or
supervising authority to which it is subject.
Comptroller of Currency, Washington, D.C.;
Federal Deposit Insurance Corporation,
Washington, D.C.; The Board of Governors of
the Federal Reserve System, Washington D.C..
(b) Whether it is authorized to exercise
corporate trust powers.
The trustee is authorized to exercise corporate
trust powers.
Item 2. Affiliations With the Obligor. If the obligor
------------------------------
is an affiliate of the trustee, describe each
such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a
-----------------
part of this Statement of Eligibility.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 12th day of July, 1999.
The First National Bank of Chicago,
Trustee
By /s/ Sandra L. Caruba
----------------------------------
Sandra L. Caruba
Vice President
* Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 16 of the Form T-1 of The First National Bank
of Chicago, filed as Exhibit 25 to the Registration Statement on Form S-3 of U S
WEST Capital Funding, Inc., filed with the Securities and Exchange Commission on
May 6, 1998 (Registration No. 333-51907-01).
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
July 12, 1999
Securities and Exchange Commission
Washington, D.C. 20549
Ladies and Gentlemen:
In connection with the qualification of the Indenture by and between Torchmark
Corporation and The First National Bank of Chicago, as Trustee, the undersigned,
in accordance with Section 321(b) of the Trust Indenture Act of 1939, as
amended, hereby consents that the reports of examinations of the undersigned,
made by Federal or State authorities authorized to make such examinations, may
be furnished by such authorities to the Securities and Exchange Commission upon
its request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ Sandra L. Caruba
---------------------------------
Sandra L. Caruba
Vice President
<PAGE>
EXHIBIT 7
<TABLE>
<CAPTION>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/99 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for March 31, 1999
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC-Balance Sheet
<TABLE>
<CAPTION>
Dollar Amounts in thousands C400
------
RCFD BIL MIL THOU
---- ----------------
<S> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A): RCFD
----
a. Noninterest-bearing balances and currency and coin(1)........... 0081 3,809,517
1.a
b. Interest-bearing balances(2).................................... 0071 4,072,166
1.b
2. Securities
a. Held-to-maturity securities (from Schedule RC-B, column A)...... 1754 0
2.a
b. Available-for-sale securities (from Schedule RC-B, column D).... 1773 12,885,728
2.b
3. Federal funds sold and securities purchased under agreements to
resell............................................................. 1350 4,684,756
3.
4. Loans and lease financing receivables: RCFD
a. Loans and leases, net of unearned income (from Schedule ----
RC-C)............................................................ 2122 34,304,806 4.a
b. LESS: Allowance for loan and lease losses........................ 3123 411,476 4.b
c. LESS: Allocated transfer risk reserve............................ 3128 3,884 4.c
RCFD
d. Loans and leases, net of unearned income, allowance, and ----
reserve (item 4.a minus 4.b and 4.c)............................. 2125 33,889,446
4.d
5. Trading assets (from Schedule RD-D)................................. 3545 5,100,499
5.
6. Premises and fixed assets (including capitalized leases)............ 2145 754,052
6.
7. Other real estate owned (from Schedule RC-M)........................ 2150 5,244
7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)...................................... 2130 201,068
8.
9. Customers' liability to this bank on acceptances outstanding........ 2155 265,041
9.
10. Intangible assets (from Schedule RC-M).............................. 2143 285,709 10.
11. Other assets (from Schedule RC-F)................................... 2160 2,987,184 11.
12. Total assets (sum of items 1 through 11)............................ 2170 68,940,410 12.
- ------------------
</TABLE>
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/99 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
Schedule RC-Continued
Dollar Amounts in
Thousands
-----------------
<S> <C> <C> <C>
LIABILITIES
13. Deposits: RCON
a. In domestic offices (sum of totals of columns A and C ----
from Schedule RC-E, part 1).......................... 2200 22,163,664 13.a
(1) Noninterest-bearing(1)........................... 6631 9,740,100 13.a1
(2) Interest-bearing................................. 6636 12,423,564 13.a2
RCFN
b. In foreign offices, Edge and Agreement subsidiaries, ----
and IBFs (from Schedule RC-E, part II).............. 2200 19,273,426 13.b
(1) Noninterest bearing............................. 6631 334,741 13.b1
(2) Interest-bearing................................ 6636 18,938,685 13.b2
14. Federal funds purchased and securities sold under
agreements to repurchase: RCFD 2800 4,405,792 14
15. a. Demand notes issued to the U.S. Treasury............ RCON 2840 173,505 15.a
b. Trading Liabilities (from Schedule RC-D)............ RCFD 3548 4,824,567 15.b
RCFD
16. Other borrowed money: ----
a. With original maturity of one year or less.......... 2332 7,453,761 16.a
b. With original maturity of more than one year....... A547 330,300 16.b
c. With original maturity of more than three years.... A548 357,737 16.c
17. Not applicable
18. Bank's liability on acceptance executed and
outstanding............................................ 2920 265,041 18.
19. Subordinated notes and debentures...................... 3200 2,600,000 19.
20. Other liabilities (from Schedule RC-G)................. 2930 1,878,367 20.
21. Total liabilities (sum of items 13 through 20)......... 2948 63,726,160 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus.......... 3838 0 23.
24. Common stock........................................... 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred
stock)................................................. 3839 3,239,836 25.
26. a. Undivided profits and capital reserves.............. 3632 1,813,367 26.a
b. Net unrealized holding gains (losses) on available-
for-sale securities................................ 8434 (37,357) 26.b
c. Accumulated net gains (losses) on cash flow
hedges............................................ 4336 0 26.c
27. Cumulative foreign currency translation adjustments... 3284 (2,454) 27.
28. Total equity capital (sum of items 23 through 27)..... 3210 5,214,250 28.
29. Total liabilities, limited-life preferred stock, and
equity capital (sum of items 21, 22, and 28).......... 3300 68,940,410 29.
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below comprehensive
that best describes the most level of auditing work performed for Number
the bank by independent external auditors as of any date during 1996....RCFD 6724 .... M.1.
1 = Independent audit of the bank conducted in accordance 4 = Directors' examination of the bank performed by
with generally accepted auditing standards by a certified other external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit work
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
</TABLE>
- -------------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
<PAGE>
EXHIBIT 25.3
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)
___
--------------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
--------------------
TORCHMARK CAPITAL TRUST I
(Exact name of obligor as specified in its charter)
Delaware To be applied for
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
2001 Third Avenue South
Birmingham, Alabama 35233
(Address of principal executive offices) (Zip Code)
Preferred Securities
(Title of Indenture Securities)
<PAGE>
Item 1. General Information. Furnish the following
--------------------
information as to the trustee:
(a) Name and address of each examining or
supervising authority to which it is subject.
Comptroller of Currency, Washington, D.C.;
Federal Deposit Insurance Corporation,
Washington, D.C.; The Board of Governors of
the Federal Reserve System, Washington D.C..
(b) Whether it is authorized to exercise
corporate trust powers.
The trustee is authorized to exercise corporate
trust powers.
Item 2. Affiliations With the Obligor. If the obligor
------------------------------
is an affiliate of the trustee, describe each
such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a
-----------------
part of this Statement of Eligibility.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 12th day of July, 1999.
The First National Bank of Chicago,
Trustee
By /s/ Sandra L. Caruba
----------------------------------
Sandra L. Caruba
Vice President
* Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 16 of the Form T-1 of The First National Bank
of Chicago, filed as Exhibit 25 to the Registration Statement on Form S-3 of U S
WEST Capital Funding, Inc., filed with the Securities and Exchange Commission on
May 6, 1998 (Registration No. 333-51907-01).
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
July 12, 1999
Securities and Exchange Commission
Washington, D.C. 20549
Ladies and Gentlemen:
In connection with the qualification of the Indenture by and between Torchmark
Corporation and The First National Bank of Chicago, as Trustee, the undersigned,
in accordance with Section 321(b) of the Trust Indenture Act of 1939, as
amended, hereby consents that the reports of examinations of the undersigned,
made by Federal or State authorities authorized to make such examinations, may
be furnished by such authorities to the Securities and Exchange Commission upon
its request therefor.
Very truly yours,
The First National Bank of Chicago
By: /s/ Sandra L. Caruba
---------------------------------
Sandra L. Caruba
Vice President
<PAGE>
EXHIBIT 7
<TABLE>
<CAPTION>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/99 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for March 31, 1999
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC-Balance Sheet
<TABLE>
<CAPTION>
Dollar Amounts in thousands C400
------
RCFD BIL MIL THOU
---- ----------------
<S> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A): RCFD
----
a. Noninterest-bearing balances and currency and coin(1)........... 0081 3,809,517
1.a
b. Interest-bearing balances(2).................................... 0071 4,072,166
1.b
2. Securities
a. Held-to-maturity securities (from Schedule RC-B, column A)...... 1754 0
2.a
b. Available-for-sale securities (from Schedule RC-B, column D).... 1773 12,885,728
2.b
3. Federal funds sold and securities purchased under agreements to
resell............................................................. 1350 4,684,756
3.
4. Loans and lease financing receivables: RCFD
a. Loans and leases, net of unearned income (from Schedule ----
RC-C)............................................................ 2122 34,304,806 4.a
b. LESS: Allowance for loan and lease losses........................ 3123 411,476 4.b
c. LESS: Allocated transfer risk reserve............................ 3128 3,884 4.c
RCFD
d. Loans and leases, net of unearned income, allowance, and ----
reserve (item 4.a minus 4.b and 4.c)............................. 2125 33,889,446
4.d
5. Trading assets (from Schedule RD-D)................................. 3545 5,100,499
5.
6. Premises and fixed assets (including capitalized leases)............ 2145 754,052
6.
7. Other real estate owned (from Schedule RC-M)........................ 2150 5,244
7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)...................................... 2130 201,068
8.
9. Customers' liability to this bank on acceptances outstanding........ 2155 265,041
9.
10. Intangible assets (from Schedule RC-M).............................. 2143 285,709 10.
11. Other assets (from Schedule RC-F)................................... 2160 2,987,184 11.
12. Total assets (sum of items 1 through 11)............................ 2170 68,940,410 12.
- ------------------
</TABLE>
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/99 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
Schedule RC-Continued
Dollar Amounts in
Thousands
-----------------
<S> <C> <C> <C>
LIABILITIES
13. Deposits: RCON
a. In domestic offices (sum of totals of columns A and C ----
from Schedule RC-E, part 1).......................... 2200 22,163,664 13.a
(1) Noninterest-bearing(1)........................... 6631 9,740,100 13.a1
(2) Interest-bearing................................. 6636 12,423,564 13.a2
RCFN
b. In foreign offices, Edge and Agreement subsidiaries, ----
and IBFs (from Schedule RC-E, part II).............. 2200 19,273,426 13.b
(1) Noninterest bearing............................. 6631 334,741 13.b1
(2) Interest-bearing................................ 6636 18,938,685 13.b2
14. Federal funds purchased and securities sold under
agreements to repurchase: RCFD 2800 4,405,792 14
15. a. Demand notes issued to the U.S. Treasury............ RCON 2840 173,505 15.a
b. Trading Liabilities (from Schedule RC-D)............ RCFD 3548 4,824,567 15.b
RCFD
16. Other borrowed money: ----
a. With original maturity of one year or less.......... 2332 7,453,761 16.a
b. With original maturity of more than one year....... A547 330,300 16.b
c. With original maturity of more than three years.... A548 357,737 16.c
17. Not applicable
18. Bank's liability on acceptance executed and
outstanding............................................ 2920 265,041 18.
19. Subordinated notes and debentures...................... 3200 2,600,000 19.
20. Other liabilities (from Schedule RC-G)................. 2930 1,878,367 20.
21. Total liabilities (sum of items 13 through 20)......... 2948 63,726,160 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus.......... 3838 0 23.
24. Common stock........................................... 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred
stock)................................................. 3839 3,239,836 25.
26. a. Undivided profits and capital reserves.............. 3632 1,813,367 26.a
b. Net unrealized holding gains (losses) on available-
for-sale securities................................ 8434 (37,357) 26.b
c. Accumulated net gains (losses) on cash flow
hedges............................................ 4336 0 26.c
27. Cumulative foreign currency translation adjustments... 3284 (2,454) 27.
28. Total equity capital (sum of items 23 through 27)..... 3210 5,214,250 28.
29. Total liabilities, limited-life preferred stock, and
equity capital (sum of items 21, 22, and 28).......... 3300 68,940,410 29.
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below comprehensive
that best describes the most level of auditing work performed for Number
the bank by independent external auditors as of any date during 1996....RCFD 6724 .... M.1.
1 = Independent audit of the bank conducted in accordance 4 = Directors' examination of the bank performed by
with generally accepted auditing standards by a certified other external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit work
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
</TABLE>
- -------------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
