UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of
the Securities Exchange Act of 1934
-----------
Date of Report (Date of earliest event reported): October 21, 1999
CONSECO, INC.
(Exact name of registrant as specified in its charter)
Indiana 1-9250 35-1468632
---------------- ----------- -------------------
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
organization)
11825 North Pennsylvania Street
Carmel, Indiana 46032
-------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(317) 817-6100
--------------------
(Registrant's telephone number, including area code)
Not Applicable
-------------------------------
(Former name or former address,
if changed since last report.)
<PAGE>
ITEM 5. OTHER EVENTS.
On October 21, 1999, Conseco, Inc. ("Conseco") completed the public
offering of $450.0 million of 8.5 percent notes due October 15, 2002 (the "8.5%
Notes") and $550.0 million of 9.0 percent notes due October 15, 2006 (the "9.0%
Notes"). The 8.5% Notes were priced at 99.977 percent of par and the 9.0% Notes
were priced at 99.510 percent of par. Interest on both the 8.5% Notes and the
9.0% Notes is payable semi-annually on April 15 and October 15 of each year,
beginning on April 15, 2000. Both the 8.5% Notes and the 9.0% Notes are
redeemable in whole or in part at the option of Conseco at any time at a
redemption price equal to the greater of: (i) 100 percent of the principal
amount of the notes to be redeemed plus accrued interest to the date of
redemption; and (ii) the sum of the present values of the remaining scheduled
payments of principal and interest thereon from the redemption date to the
maturity date, computed by discounting such payments, in each case, to the
redemption date on a semi-annual basis at the Treasury rate (as defined) plus 25
basis points, plus accrued interest on the principal amount thereof to the date
of redemption. Both the 8.5% Notes and 9.0% Notes are unsecured and rank equally
with all other unsecured senior indebtedness of Conseco.
Proceeds from the offering of approximately $991 million (after
underwriting discounts and estimated offering expenses) will be used by Conseco
for the repayment of outstanding indebtedness.
2
<PAGE>
ITEM 7(c). EXHIBITS.
1.1 Underwriting Agreement dated October 18, 1999
4.1 8.5% Note due October 15, 2002 (one of several notes
with identical terms aggregating $450 million)
4.2 9% Note due October 15, 2006 (one of several notes with
identical terms aggregating $550 million)
5.1 Opinion of John J. Sabl
23.1 Consent of John J. Sabl (included in Exhibit 5.1)
3
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CONSECO, INC.
DATE: October 21, 1999
By: /s/ ROLLIN M. DICK
----------------------------------
Name: Rollin M. Dick
Title: Executive Vice President
and Chief Financial Officer
4
CONSECO, INC.
(an Indiana Corporation)
$450,000,000 8.5% Notes due October 15, 2002
$550,000,000 9.0% Notes due October 15, 2006
Underwriting Agreement
October 18, 1999
<PAGE>
CONSECO, INC.
(an Indiana Corporation)
$450,000,000 8.5% Notes due October 15, 2002
$550,000,000 9.0% Notes due October 15, 2006
Underwriting Agreement
----------------------
October 18, 1999
CHASE SECURITIES INC.
LEHMAN BROTHERS
as Representatives of the several Underwriters
c/o Lehman Brothers Inc.
3 World Financial Center
New York, New York 10285
Ladies and Gentlemen:
Conseco, Inc., an Indiana corporation (the "Company"), confirms its
agreement with the several underwriters named in Schedule A hereto
(collectively, the "Underwriters," which term shall also include any underwriter
substituted as hereinafter provided in Section 10 hereof) with respect to the
issue and sale by the Company and the purchase by the Underwriters, acting
severally and not jointly, of $450,000,000 aggregate principal amount of the
Company's 8.5% Notes due October 15, 2002 (the "2002 Notes") and $550,000,000
aggregate principal amount of the Company's 9.0% Notes due October 15, 2006 (the
"2006 Notes" and, together with the 2002 Notes, the "Notes"), to be issued
pursuant to an indenture dated as of November 13, 1997 (the "Indenture"),
between the Company and The Bank of New York, as successor to LTCB Trust
Company, as trustee (the "Trustee"). Capitalized terms used herein without
definition shall be used as defined in the Prospectus (defined below).
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-83465) and a
registration statement on Form S-3 (No. 333-56611) covering the registration of
securities of the Company, including the Notes, under the Securities Act of
1933, as amended (the "1933 Act"), including the related preliminary prospectus
or prospectuses, and the offering thereof from time to time in
-1-
<PAGE>
accordance with Rule 415 of the rules and regulations of the Commission under
the 1933 Act (the "1933 Act Regulations") and the Company has filed such
post-effective amendments thereto as may be required prior to the execution of
this Agreement. Such registration statements, as amended, have been declared
effective by the Commission and the Indenture has been duly the Trust Indenture
Act of 1939, as amended (the "1939 Act"). Registration statement No. 333-83465,
as amended, and registration statement No. 333-56611, as amended, including the
exhibits and schedules thereto, if any, and the information, if any, deemed to
be a part thereof pursuant to Rule 430A(b) of the 1933 Act Regulations (the
"Rule 430A Information") or Rule 434(d) of the 1933 Act Regulations (the "Rule
434 Information") are referred to herein as the "Registration Statement" and the
"Previous Registration Statement", respectively, and the final prospectus and
the prospectus supplement relating to the offering of the Notes, in the form
first furnished to the Underwriters by the Company for use in connection with
the offering of the Notes, are collectively referred to herein as the
"Prospectus"; provided, however, that all references to the "Registration
Statement", the "Previous Registration Statement" and the "Prospectus" shall be
deemed to include all documents incorporated therein by reference pursuant to
the Securities Exchange Act of 1934, as amended (the "1934 Act"), prior to the
execution of this Agreement; provided, further, that if the Company files a
registration statement with the Commission pursuant to Section 462(b) of the
1933 Act Regulations (a "Rule 462(b) Registration Statement"), then after such
filing, all references to the "Registration Statement" or the "Previous
Registration Statement", as the case may be, shall be deemed to include the Rule
462(b) Registration Statement; and provided, further, that if the Company elects
to rely upon Rule 434 of the 1933 Act Regulations, then all references to
"Prospectus" shall be deemed to include the final or preliminary prospectus and
the applicable term sheet or abbreviated term sheet (the "Term Sheet"), as the
case may be, in the form first furnished to the Underwriters by the Company in
reliance upon Rule 434 of the 1933 Act Regulations, and all references in this
Agreement to the date of the Prospectus shall mean the date of the Term Sheet. A
"preliminary prospectus" shall be deemed to refer to any prospectus used before
the applicable registration statement became effective and any prospectus that
omitted, as applicable, the Rule 430A Information, the Rule 434 Information or
other information to be included upon pricing in a form of prospectus filed with
the Commission pursuant to Rule 424(b) of the 1933 Act Regulations, that was
used after such effectiveness and prior to the execution and delivery of the
applicable underwriting agreement. For purposes of this Agreement, all
references to the Registration Statement, the Previous Registration Statement,
any preliminary prospectus, the Prospectus or any Term Sheet or any amendment or
supplement to any of the foregoing shall be deemed to include the copy thereof
filed with the Commission pursuant to its Electronic Data Gathering, Analysis
and Retrieval system ("EDGAR").
All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" in the
Registration Statement, the
-2-
<PAGE>
Previous Registration Statement, any preliminary prospectus or the Prospectus
(or other references of like import) shall be deemed to mean and include all
such financial statements and schedules and other information which is
incorporated by reference in the Registration Statement, the Previous
Registration Statement, any preliminary prospectus or the Prospectus, as the
case may be; and all references in this Agreement to amendments or supplements
to the Registration Statement, the Previous Registration Statement, any
preliminary prospectus or the Prospectus shall be deemed to mean and include the
filing of any document under the 1934 Act which is incorporated by reference in
the Registration Statement, the Previous Registration Statement, such
preliminary prospectus or the Prospectus, as the case may be.
The Company understands that the Underwriters propose to make a public
offering of the Notes as soon as the Underwriters deem advisable after this
Agreement has been executed and delivered.
SECTION 1. Representations and Warranties.
(a) The Company represents and warrants to each Underwriter as of the
date hereof (such date being hereinafter referred to as the "Representation
Date") that:
(i) No stop order suspending the effectiveness of the Registration
Statement or the Previous Registration Statement has been issued and no
proceeding for that purpose has been initiated or, to the knowledge and
information of the Company, threatened by the Commission.
(ii) The Company meets, and at the respective times of the
commencement and consummation of the offering of the Notes will meet, the
requirements for the use of Form S-3 under the 1933 Act. Each of the
Registration Statement, the Previous Registration Statement, and any Rule 462(b)
Registration Statement has become effective under the 1933 Act. At the
respective times the Registration Statement, the Previous Registration
Statement, any Rule 462(b) Registration Statement and any post-effective
amendments thereto became effective and at the Representation Date and at the
Closing Time (as defined herein), the Registration Statement, the Previous
Registration Statement, any Rule 462 Registration Statement and any amendments
and supplements thereto complied and will comply in all material respects with
the requirements of the 1933 Act and the 1933 Act Regulations and the 1939 Act
and the rules and regulations of the Commission under the 1939 Act (the "1939
Act Regulations") and did not and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading. At the date of the
Prospectus and at the Closing Time, the Prospectus and any amendments and
supplements thereto did not and will not include an untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances
-3-
<PAGE>
under which they were made, not misleading. If the Company elects to rely upon
Rule 434 of the 1933 Act Regulations, the Company will comply with the
requirements of Rule 434. Notwithstanding the foregoing, the representations and
warranties in this subsection shall not apply to (A) statements in or omissions
from the Registration Statement, the Previous Registration Statement or the
Prospectus made in reliance upon and in conformity with information furnished to
the Company in writing by an Underwriter through Lehman Brothers Inc. and Chase
Securities Inc. (each a "Representative" and collectively the "Representatives")
expressly for use in the Registration Statement, the Previous Registration
Statement or the Prospectus or (B) the part of the Registration Statement and
the Previous Registration Statement which shall constitute the Statement of
Eligibility (Form T-1) under the 1939 Act.
Each preliminary prospectus and prospectus filed as part of the
Registration Statement or the Previous Registration Statement as originally
filed or as part of any amendment thereto, or filed pursuant to Rule 424 under
the 1933 Act, complied when so filed in all material respects with the 1933 Act
Regulations and, if applicable, each preliminary prospectus and the Prospectus
delivered to the Underwriters for use in connection with the offering of Notes
will, at the time of such delivery, be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to EDGAR, except
to the extent permitted by Regulation S-T.
(iii) The documents incorporated or deemed to be incorporated by
reference in the Registration Statement, the Previous Registration Statement or
the Prospectus, at the time they were or hereafter are filed with the
Commission, or last amended, as the case may be, complied and will comply in all
material respects with the requirements of the 1934 Act, and the rules and
regulations of the Commission thereunder (the "1934 Act Regulations"), and at
the time of filing or as of the time of any subsequent amendment, did not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were or are made, not
misleading; and any additional documents deemed to be incorporated by reference
in the Registration Statement, the Previous Registration Statement or the
Prospectus will, if and when such documents are filed with the Commission, or
when amended, as appropriate, comply in all material respects with the
requirements of the 1934 Act and the 1934 Act Regulations and will not contain
an untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter through the
Representatives expressly for use in the Registration Statement, the Previous
Registration Statement or the Prospectus.
-4-
<PAGE>
(iv) PricewaterhouseCoopers LLP and KPMG LLP, which certified the
financial statements and supporting schedules of the Company and Green Tree
Financial Corporation ("Green Tree"), respectively, included or incorporated by
reference in the Registration Statement, the Previous Registration Statement and
the Prospectus, each are independent public accountants as required by the 1933
Act and the 1933 Act Regulations with respect to the Company and Green Tree,
respectively.
(v) The financial statements of the Company and of Green Tree
included or incorporated by reference in the Registration Statement, the
Previous Registration Statement and the Prospectus, together with the related
schedules and notes, present fairly the financial position of the Company and
its consolidated subsidiaries and Green Tree and its consolidated
subsidiaries, respectively, as of the dates indicated and the results of their
respective operations for the periods specified. Except as otherwise stated
therein such financial statements have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis
throughout the periods involved. The supporting schedules, if any, included or
incorporated by reference in the Registration Statement, the Previous
Registration Statement and the Prospectus present fairly the information
required to be stated therein. The ratio of earnings to fixed charges (and the
ratio of earnings to fixed charges and preferred stock dividends) included in
the Prospectus have been calculated in compliance with Item 503(d) of Regulation
S-K of the Commission. Any selected financial information and summary financial
data included in the Prospectus present fairly the information shown therein and
have been compiled on a basis consistent with that of the audited financial
statements included in the Registration Statement, the Previous Registration
Statement and the Prospectus. Any pro forma financial statements and the related
notes thereto included in the Registration Statement, the Previous Registration
Statement and the Prospectus present fairly the information shown therein, have
been prepared in accordance with the Commission's rules and guidelines with
respect to pro forma financial statements and have been properly compiled on the
bases described therein, and the assumptions used in the preparation thereof are
reasonable and the adjustments used therein are appropriate to give effect to
the transactions and circumstances referred to therein.
(vi) The statutory financial statements of each of the Company's
insurance subsidiaries, from which certain ratios and other statistical data
contained in the Registration Statement and the Previous Registration Statement
have been derived, have for each relevant period been prepared in accordance
with accounting practices prescribed or permitted by the National Association of
Insurance Commissioners, and with respect to each insurance subsidiary, the
appropriate Insurance Department of the state of domicile of such insurance
subsidiary, and such accounting practices have been applied on a consistent
basis throughout the periods involved.
-5-
<PAGE>
(vii) Since the respective dates as of which information is given
in the Registration Statement, the Previous Registration Statement and the
Prospectus, and except as otherwise stated therein, (A) there has been no
material adverse change and no development which could reasonably be expected to
result in a material adverse change in the condition, financial or otherwise, or
in the earnings, business affairs or business prospects of the Company and its
subsidiaries, considered as one enterprise, whether or not arising in the
ordinary course of business (a "Material Adverse Effect"), (B) there have been
no transactions entered into by the Company or any of its subsidiaries, other
than those arising in the ordinary course of business, which are material with
respect to the Company and its subsidiaries, considered as one enterprise, and
(C) except for regular dividends on the Common Stock or Preferred Stock of the
Company in amounts per share that are consistent with past practice or the
applicable charter document or supplement thereto, respectively, there has been
no dividend or distribution of any kind declared, paid or made by the Company on
any class of its capital stock.
(viii) The Company has been incorporated, is validly existing as a
corporation and its status is active under the laws of the State of Indiana,
with corporate power and authority to own, lease and operate its properties and
to conduct its business as presently conducted and as described in the
Prospectus and to enter into and perform its obligations under, or as
contemplated under, this Agreement and the Indenture. The Company is qualified
as a foreign corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except where the
failure to so qualify or be in good standing would not have a Material Adverse
Effect.
(ix) Each "significant subsidiary" of the Company within the
meaning of Rule 1-02 of Regulation S-X promulgated under the 1933 Act is listed
on Schedule B hereto, and each such subsidiary, and each of the other
subsidiaries listed for purposes of this Agreement on Schedule B hereto (each of
such subsidiaries listed on Schedule B, for purposes of this Agreement, a
"Significant Subsidiary") has been incorporated and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own, lease and operate
its properties and to conduct its business as presently conducted and as
described in the Prospectus, and is qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure to so qualify or
be in good standing would not have a Material Adverse Effect. Except as
otherwise stated in the Registration Statement, the Previous Registration
Statement and the Prospectus, all of the issued and outstanding shares of
capital stock of each Significant Subsidiary of the Company have been authorized
and validly issued, are fully paid and non-assessable and all such shares are
owned by the Company, directly or through
-6-
<PAGE>
its subsidiaries, free and clear of any material security interest, mortgage,
pledge, lien, encumbrance, claim or equity.
(x) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Prospectus; since the date indicated in the
Prospectus there has been no change in the consolidated capitalization of the
Company and its subsidiaries (other than changes in outstanding Common Stock of
the Company resulting from (A) incentive compensation plan, employee or agent
benefit plan or dividend reinvestment and stock purchase plan transactions,
including, without limitation, the purchase of shares of Common Stock of the
Company or cancellation of options in connection therewith, or (B) the exercise
of conversion or exchange rights with respect to securities outstanding as of
the date of the Prospectus); and all of the issued and outstanding capital stock
of the Company has been authorized and validly issued, is fully paid and
non-assessable and conforms to the descriptions thereof contained in the
Prospectus.
(xi) The Indenture has been authorized by the Company and
qualified under the 1939 Act and, at the Closing Time, has been executed and
delivered and constitutes a legal, valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms except to the
extent that enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors' rights
generally or by general principles of equity (regardless of whether enforcement
is considered in a proceeding at law or in equity) (the "Bankruptcy
Exceptions"); the Indenture conforms in all material respects to the description
thereof contained in the Prospectus.
(xii) The Notes have been duly authorized by the Company and, at
the Closing Time, will have been executed by the Company and, when authenticated
in the manner provided for in the Indenture and delivered against payment
therefor as described in the Prospectus, will constitute legal, valid and
binding obligations of the Company, enforceable against the Company in
accordance with their respective terms except to the extent that enforcement
thereof may be limited by the Bankruptcy Exceptions, and will be in the form
contemplated by, and entitled to the benefits of, the Indenture and will conform
in all material respects to the descriptions thereof contained in the
Prospectus.
(xiii) Neither the Company nor any of its Significant Subsidiaries
is in violation of its articles of incorporation or by-laws. Neither the Company
nor any of its Significant Subsidiaries is in default in the performance or
observance of any obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, note, lease, loan or credit agreement or any
other agreement or instrument (the "Agreements and Instruments") to which the
Company or any of its Significant Subsidiaries is a party or by which any of
them may be bound, or to which any of the property or assets of the Company or
any Significant Subsidiary is subject,
-7-
<PAGE>
or in violation of any applicable law, rule or regulation or any judgment, order
or decree of any government, governmental instrumentality or court, domestic or
foreign, having jurisdiction over the Company or any of its Significant
Subsidiaries or any of their respective properties or assets, which violation or
default would, singly or in the aggregate, have a Material Adverse Effect.
(xiv) The offer of the Notes as contemplated herein and in the
Prospectus; the execution, delivery and performance of this Agreement and the
Indenture, and the consummation of the transactions contemplated herein, therein
and in the Registration Statement and the Previous Registration Statement
(including the issuance and sale of the Notes and the use of proceeds from the
sale of the Notes as described in the Prospectus under the caption "Use of
Proceeds") and compliance by the Company with its obligations hereunder and
thereunder do not and will not, whether with or without the giving of notice or
passage of time or both, conflict with or constitute a breach of any of the
terms or provisions of, or constitute a default or Repayment Event (as defined
below) under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any subsidiary
pursuant to, the Agreements and Instruments (except for such conflicts, breaches
or defaults or liens, charges or encumbrances that would not result in a
Material Adverse Effect), nor will such action result in any violation of any
applicable law, statute, rule, regulation, judgment, order, writ or decree of
any government, government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any of its Significant Subsidiaries, or any of
their assets, properties or operations (except for such violations that would
not result in a Material Adverse Effect), nor will such action result in any
violation of the provisions of the charter or by-laws of the Company or any
Significant Subsidiary. As used herein, a "Repayment Event" means any event or
condition which gives the holder of any note, debenture or other evidence of
indebtedness of the Company or any Significant Subsidiary (or any person acting
on such holder's behalf) the right to require the repurchase, redemption or
repayment of all or a portion of such indebtedness by the Company or any
Significant Subsidiary.
(xv) There is no action, suit, proceeding, inquiry or
investigation before or by any court or governmental agency or body, domestic or
foreign (including, without limitation, any proceeding to revoke or deny renewal
of any Insurance Licenses (as defined below)), now pending or to the knowledge
of the Company threatened against or affecting the Company or any of its
subsidiaries which is required to be disclosed in the Registration Statement,
the Previous Registration Statement and the Prospectus (other than as stated
therein), or which might reasonably be expected to result in a Material Adverse
Effect, or which might be reasonably expected to materially and adversely affect
the consummation of this Agreement, the Indenture or the transactions
contemplated herein, therein or in the Registration Statement, the Previous
Registration Statement or the Prospectus. The aggregate of all pending legal or
governmental proceedings to which the Company or any subsidiary thereof is a
party or of which any of their
-8-
<PAGE>
respective properties or operations is the subject which are not described in
the Registration Statement, the Previous Registration Statement or the
Prospectus, including ordinary routine litigation incidental to the business or
the Company or any of its subsidiaries, could not reasonably be expected to
result in a Material Adverse Effect; and there are no contracts or documents of
the Company or any of its subsidiaries which are required to be filed as
exhibits to the Registration Statement or the Previous Registration Statement,
or to be incorporated by reference therein, by the 1933 Act, the 1933 Act
Regulations, the 1934 Act or the 1934 Act Regulations, which have not been so
filed or incorporated by reference.
(xvi) The Company and its subsidiaries possess such permits,
licenses, approvals, consents and other authorizations issued by the appropriate
federal, state, local or foreign regulatory agencies or bodies (including,
without limitation, insurance licenses from the insurance departments of the
various states where the subsidiaries write insurance business (the "Insurance
Licenses")) that are material to the Company and its subsidiaries taken as a
whole and are necessary to conduct the business now operated by them; the
Company and its subsidiaries are in compliance with the terms and conditions of
all such Insurance Licenses, except where the failure so to comply would not,
singly or in the aggregate, result in a Material Adverse Effect; all of the
Insurance Licenses are valid and in full force and effect, except where the
invalidity of such Insurance Licenses or the failure of such Insurance Licenses
to be in full force and effect would not result in a Material Adverse Effect;
and neither the Company nor any of its subsidiaries has received any notice of
proceedings relating to the revocation or modification of any such Insurance
Licenses which, singly or in the aggregate, may reasonably be expected to result
in a Material Adverse Effect.
(xvii) No authorization, approval, consent, order, registration or
qualification of or with any court or governmental authority or agency
(including, without limitation, any Insurance regulatory agency or body) is
required in connection with the offering, issuance and sale of the Notes or the
consummation by the Company of any other transactions contemplated hereby,
except such as have been obtained and made under the federal securities laws or
state Insurance laws and such as may be required under state or foreign
securities or Blue Sky laws.
(xviii) This Agreement has been duly authorized, executed and
delivered by the Company.
(xix) Neither the Company nor any of its Significant Subsidiaries
is, and upon the issuance and sale of the Notes as herein contemplated and the
application of the net proceeds therefrom as described in the Prospectus will
be, an "investment company" or an entity "controlled" by an "investment company"
as such terms are defined in the Investment Company Act of 1940, as amended (the
"1940 Act").
-9-
<PAGE>
(xx) None of the Company, its Significant Subsidiaries or any of
their respective directors, officers or controlling persons, has taken, directly
or indirectly, any action resulting in a violation of Regulation M under the
1934 Act, or designed to cause or result in, or that has constituted or that
reasonably might be expected to constitute, the stabilization or manipulation of
the price of any security of the Company to facilitate the sale or resale of the
Notes or the Common Stock of the Company, in each case in violation of
applicable law.
(xxi) No "forward looking statement" (as defined in Rule 175 under
the 1933 Act) contained in the Registration Statement, any preliminary
prospectus or the Prospectus was made or reaffirmed without a reasonable basis
or was disclosed other than in good faith.
(b) Any certificate signed by any officer of the Company and delivered
to the Underwriters or to counsel for the Underwriters shall be deemed a
representation and warranty by the Company to the Underwriters as to the matters
covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) On the basis of the representations and warranties herein contained
and subject to the terms and conditions herein set forth, the Company agrees to
sell to each Underwriter, and each Underwriter severally and not jointly agrees
to purchase from the Company, (i) at the price of 99.527% of the principal
amount thereof, the principal amount of 2002 Notes set forth in Schedule A
hereto opposite the name of such Underwriter in the column designated "Principal
Amount of 2002 Notes", plus any additional principal amount of 2002 Notes which
such Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof and (ii) at the price of 98.885% of the principal amount
thereof, the principal amount of 2006 Notes set forth in Schedule A hereto
opposite the name of such Underwriter in the column designated "Principal Amount
of 2006 Notes", plus any additional principal amount of 2006 Notes which such
Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof.
(b) The initial public offering price of the 2002 Notes shall be
99.977% of the principal amount thereof, plus accrued interest, if any, from the
date of issuance. The interest rate on the 2002 Notes shall be 8.5% per annum.
The initial public offering price of the 2006 Notes shall be 99.510% of the
principal amount thereof, plus accrued interest, if any, from the date of
issuance. The interest rate on the 2006 Notes shall be 9.0% per annum. The Notes
will be redeemable as a whole or in part at the option of the Company at any
time, at a redemption price equal to the greater of (i) 100% of the principal
amount thereof and (ii) the sum of the present values of the remaining scheduled
payments of principal and interest thereon from the redemption date to the
maturity date, computed by discounting such payments, in each case, to the
redemption date on a
-10-
<PAGE>
semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at
the Treasury Rate (as defined in the Prospectus) plus 25 basis points plus, in
each case, accrued interest on the principal amount thereof to the date of
redemption.
(c) Delivery of certificates for the Notes against payment of the
purchase price for such Notes shall be made at the offices of LeBoeuf, Lamb,
Greene & MacRae, L.L.P., 125 West 55th Street, New York, New York 10019 or at
such other place as shall be agreed upon by the Underwriters and the Company, at
9:00 a.m. (New York City time) on the third business day after execution of this
Agreement (or, if pricing of the Notes occurs after 4:30 p.m., New York City
time, on the fourth full business day thereafter), or such other time not later
than ten business days after such date as shall be agreed upon by the
Underwriters and the Company (such time and date of payment and delivery being
referred to herein as the "Closing Time"). Payment for the Notes purchased by
the Underwriters shall be made by wire transfer of immediately available funds,
payable to the Company, against delivery to the respective accounts of the
Underwriters of the Notes to be purchased by them. Delivery of, and payment for,
the Notes shall be made through the facilities of the Depository Trust Company.
Certificates for the Notes, if any, shall be in such denominations and
registered in such names as the Underwriters may request in writing at least two
full business days before the Closing Time. Each Representative, individually
and not as a representative of the Underwriters, may (but shall not be obligated
to) make payment of the purchase price for the Notes, if any, to be purchased by
any Underwriter whose funds have not been received by the Closing Time, but such
payment shall not relieve such Underwriter from its obligations hereunder. The
certificates for the Notes will be made available for examination by the
Underwriters no later than 10:00 a.m. (New York City time) on the last business
day prior to the Closing Time.
SECTION 3. Covenants of the Company. The Company agrees with the
Underwriters as follows:
(a) Promptly following the execution of this Agreement, the Company
will cause the Prospectus to be filed with the Commission pursuant to Rule 424
of the 1933 Act Regulations and the Company will promptly advise the
Underwriters when such filing has been made. Prior to the filing, the Company
will cooperate with the Underwriters in the preparation of the prospectus
supplement to assure that the Underwriters have no reasonable objection to the
form or content thereof when filed or mailed.
(b) The Company, subject to Section 3(c), will comply with the
requirements of Rule 430A of the 1933 Act Regulations and/or Rule 434 of the
1933 Act Regulations if and as applicable, and will notify the Underwriters
immediately of (i) the effectiveness of any post-
-11-
<PAGE>
effective amendment to the Registration Statement or the Previous Registration
Statement or the filing of any supplement or amendment to the Prospectus, (ii)
the receipt of any comments from the Commission, (iii) any request by the
Commission for any amendment to the Registration Statement or the Previous
Registration Statement or any amendment or supplement to the Prospectus or for
additional information, (iv) the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the Previous
Registration Statement or the initiation of any proceedings for that purpose and
(v) the issuance by any state securities commission or other regulatory
authority of any order suspending the qualification or the exemption from
qualification of the Notes under state securities or Blue Sky laws or the
initiation or threatening of any proceeding for such purpose. The Company will
make all reasonable efforts to prevent the issuance of any stop order and, if
any stop order is issued, to promptly obtain the lifting thereof.
(c) The Company will give the Underwriters notice of its intention to
file or prepare any amendment to the Registration Statement or the Previous
Registration Statement (including any post-effective amendment and any filing
under Rule 462(b) of the 1933 Act Regulations), any Term Sheet or any amendment,
supplement or revision to either the prospectus included in the Registration
Statement or the Previous Registration Statement at the time it became effective
or to the Prospectus, whether pursuant to the 1933 Act, the 1934 Act or
otherwise; will furnish the Underwriters with copies of any such Rule 462(b)
Registration Statement, Term Sheet, amendment, supplement or revision a
reasonable amount of time prior to such proposed filing or use, as the case may
be; and will not file any such Rule 462(b) Registration Statement, Term Sheet,
amendment, supplement or revision to which the Underwriters or counsel for the
Underwriters shall reasonably object.
(d) The Company will deliver to the Representatives and counsel for the
Underwriters, without charge, conformed copies of the Registration Statement and
the Previous Registration Statement as originally filed and of each amendment
thereto (including exhibits filed therewith or incorporated by reference therein
and documents incorporated or deemed to be incorporated by reference therein)
and conformed copies of all consents and certificates of experts, and will also
deliver to the Representatives, without charge, a conformed copy of the
Registration Statement and the Previous Registration Statement as originally
filed and of each amendment thereto (without exhibits) for each of the
Underwriters. If applicable, the copies of the Registration Statement and the
Previous Registration Statement and each amendment thereto furnished to the
Underwriters will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to EDGAR, except to the extent permitted by
Regulation S-T.
(e) The Company has delivered to each Underwriter, without charge, as
many copies of any preliminary prospectus as such Underwriter reasonably
requested, and the Company hereby
-12-
<PAGE>
consents to the use of such copies for purposes permitted by the 1933 Act. The
Company will furnish to each Underwriter, without charge, during the period when
the Prospectus is required to be delivered under the 1933 Act or the 1934 Act,
such number of copies of the Prospectus (as amended or supplemented) as such
Underwriter may reasonably request. If applicable, the Prospectus and any
amendments or supplements thereto furnished to the Underwriter will be identical
to the electronically transmitted copies thereof filed with the Commission
pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(f) The Company will comply with the 1933 Act and the 1933 Act
Regulations and the 1934 Act and the 1934 Act Regulations so as to permit the
completion of the distribution of the Notes as contemplated in this Agreement
and in the Registration Statement, the Previous Registration Statement and the
Prospectus. If at any time when the Prospectus is required by the 1933 Act or
the 1934 Act to be delivered in connection with sales of the Notes, any event
shall occur or condition shall exist as a result of which it is necessary, in
the opinion of counsel for the Underwriters or for the Company, to amend the
Registration Statement or the Previous Registration Statement, as the case may
be, in order that the Registration Statement or the Previous Registration
Statement will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or to amend or supplement the Prospectus in
order that the Prospectus will not include an untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein not misleading in the light of the circumstances existing at the time it
is delivered to a purchaser, or if it shall be necessary, in the opinion of such
counsel, at any such time to amend the Registration Statement or the Previous
Registration Statement or amend or supplement the Prospectus in order to comply
with the requirements of the 1933 Act or the 1933 Act Regulations, the Company
will promptly prepare and file with the Commission, subject to Section 3(c),
such amendment or supplement as may be necessary to correct such statement or
omission or to make the Registration Statement, the Previous Registration
Statement or the Prospectus comply with such requirements, and the Company will
furnish to the Underwriters, without charge, such number of copies of such
amendment or supplement as the Underwriters may reasonably request.
(g) The Company will use its best efforts, in cooperation with the
Underwriters, to qualify the Notes for offering and sale under the applicable
securities laws of such states and other jurisdictions (domestic or foreign) as
the Representatives may designate; provided, however, that the Company shall not
be obligated to qualify as a foreign corporation in any jurisdiction in which it
is not so qualified or subject itself to taxation in respect of doing business
in any jurisdiction in which it is not otherwise so subject.
-13-
<PAGE>
(h) The Company will make generally available to its securityholders as
soon as practicable, but not later than 45 days (or 90 days, in the case of a
period that is also the Company's fiscal year) after the close of the period
covered thereby, an earnings statement of the Company and its subsidiaries (in
form complying with the provisions of Rule 158 of the 1933 Act Regulations)
covering a twelve-month period beginning not later than the first day of the
Company's fiscal quarter next following the "effective date" (as defined in said
Rule 158) of the Registration Statement.
(i) The Company will use the net proceeds received by it from the sale
of the Notes in the manner specified in the Prospectus under "Use of Proceeds."
(j) If, at the time that the Registration Statement or the Previous
Registration Statement became (or in the case of a post-effective amendment
becomes) effective, any information shall have been omitted therefrom in
reliance upon Rule 430A or Rule 434 of the 1933 Act Regulations, then
immediately following the execution of this Agreement, the Company will prepare,
and file or transmit for filing with the Commission in accordance with such Rule
430A or Rule 434 and Rule 424(b) of the 1933 Act Regulations, copies of an
amended Prospectus, or Term Sheet, or, if required by such Rule 430A, a
post-effective amendment to the Registration Statement or the Previous
Registration Statement (including an amended Prospectus), containing all
information so omitted.
(k) If the Company elects to rely upon Rule 462(b), the Company shall
file a Rule 462(b) Registration Statement with the Commission in compliance with
Rule 462(b) and pay the applicable fees in accordance with Rule 111 of the 1933
Act Regulations by the earlier of (i) 10:00 p.m. New York City time on the date
of this Agreement and (ii) the time confirmations are sent or given, as
specified by Rule 462(b)(2).
(l) The Company, during the period when the Prospectus is required to
be delivered under the 1933 Act, will file all documents required to be filed
with the Commission pursuant to Section 13, 14 or 15 of the 1934 Act within the
time periods required by the 1934 Act and the 1934 Act Regulations.
(m) Between the date of the Prospectus and the Closing Time, the
Company will not, without the prior written consent of the Representatives,
directly or indirectly, issue, sell, offer or contract to sell, grant any option
for the sale of, or otherwise transfer or dispose of, any debt securities of the
Company (other than the Notes or commercial paper in the ordinary course of
business).
-14-
<PAGE>
(n) The Company, during a period of one year from the Closing Time,
will make generally available to the Underwriters copies of all reports and
other communications (financial or other) mailed to stockholders, and deliver to
the Underwriters promptly after they are available, copies of any reports and
financial statements furnished to or filed with the Commission or any national
securities exchange on which any class of securities of the Company is listed
(such financial statements to be on a consolidated basis to the extent the
accounts of the Company and its subsidiaries are consolidated in reports
furnished to its stockholders generally or to the Commission).
(o) Neither the Company nor its subsidiaries will take, directly or
indirectly, any action resulting in a violation of Regulation M under the 1934
Act, or designed to cause or result in, or that reasonably might be expected to
constitute, the stabilization or manipulation of the price of any security of
the Company to facilitate the sale or resale of the Notes or the Common Stock of
the Company, in each case, in violation of applicable law.
SECTION 4. Payment of Expenses. The Company will pay all expenses
incident to the performance of its obligations under this Agreement, including,
without limitation, expenses related to the following, if incurred: (i) the
preparation, delivery, printing and filing of the Registration Statement, the
Previous Registration Statement and Prospectus as originally filed (including
financial statements and exhibits) and of each amendment thereto; (ii) the
preparation, printing and delivery to the Underwriters of this Agreement, any
Agreement Among Underwriters, the Indenture and such other documents as may be
required in connection with the offering, purchase, sale and delivery of the
Notes; (iii) the preparation, issuance and delivery of the certificates for the
Notes; (iv) the fees and disbursements of the Company's counsel, accountants and
other advisors or agents (including the transfer agents and registrars), as well
as fees and disbursements of the Trustee and any Depositary, and their
respective counsel (except as provided for in the Prospectus); (v) the
qualification of the Notes under securities laws in accordance with the
provisions of Section 3(g), including filing fees and the reasonable fees and
disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation of any Blue Sky Survey and any Legal Investment
Survey; (vi) the printing and delivery to the Underwriters of copies of the
Registration Statement and the Previous Registration Statement as originally
filed and of each amendment thereto, of each preliminary prospectus, any Term
Sheet and of the Prospectus and any amendments or supplements thereto; (vii) the
printing and delivery to the Underwriters of copies of any Blue Sky Survey and
any Legal Investment Survey; (viii) any fees payable in connection with the
rating of the Notes by nationally recognized statistical rating organizations;
(ix) the filing fees incident to, and the fees and disbursements of counsel to
the Underwriters in connection with, the review, if any, by the National
Association of Securities Dealers, Inc. (the "NASD") of the terms of the sale of
the
-15-
<PAGE>
Notes; (x) any fees payable in connection with any listing of Notes on any
securities exchange or quotation system; and (xi) any fees payable to the
Commission.
If this Agreement is terminated by the Underwriters in accordance with
the provisions of Section 5 or Section 9(a)(i) hereof, the Company shall
reimburse the Underwriters for all of their out-of-pocket expenses, including
the reasonable fees and disbursements of LeBoeuf, Lamb, Greene & MacRae, L.L.P.,
counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of
the Underwriters to purchase and pay for the Notes pursuant to this Agreement
are subject to the accuracy of the representations and warranties of the Company
herein contained or in certificates of any officer of the Company or any
subsidiary delivered pursuant to the provisions hereof, to the performance by
the Company of its obligations hereunder, and to the following further
conditions:
(a) The Registration Statement and the Previous Registration Statement,
including any Rule 462(b) Registration Statement, shall have become effective
under the 1933 Act not later than 5:30 p.m., New York City time, on the date
hereof, and on the date hereof and at the Closing Time, no stop order suspending
the effectiveness of the Registration Statement or the Previous Registration
Statement or any part thereof shall have been issued under the 1933 Act or
proceedings therefor initiated or threatened by the Commission, and any request
on the part of the Commission for additional information shall have been
complied with to the satisfaction of counsel to the Underwriters. A prospectus
containing information relating to the description of the Notes, the specific
method of distribution and similar matters shall have been filed with the
Commission in accordance with Rule 424(b)(1), (2), (3), (4) or (5), as
applicable (or any required post-effective amendment providing such information
shall have been filed and declared effective in accordance with the requirements
of Rule 430A), or, if the Company has elected to rely upon Rule 434 of the 1933
Act Regulations, a Term Sheet including the Rule 434 Information shall have been
filed with the Commission in accordance with Rule 424(b)(7).
(b) At the Closing Time the Underwriters shall have received:
(1) The favorable opinion, dated as of the Closing Time, of Mr.
John J. Sabl, Executive Vice President, General Counsel and Secretary of the
Company, in form and substance reasonably satisfactory to counsel for the
Underwriters, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation under the laws of the State of Indiana.
-16-
<PAGE>
(ii) The Company has corporate power and authority to own,
lease and operate its properties and to conduct its business as
described in the Prospectus.
(iii) The Company is qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which
such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure to so qualify or be in good standing would not result in a
Material Adverse Effect.
(iv) The authorized, issued and outstanding capital stock of
the Company is as set forth in the Prospectus (including information
which is incorporated by reference therein) (except for subsequent
issuances, if any, pursuant to (x) incentive compensation plan,
employee or agent benefit plan or dividend reinvestment and stock
purchase plan transactions, including, without limitation, the purchase
of shares of Common Stock of the Company or cancellation of options in
connection therewith, or (y) the exercise of conversion or exchange
rights with respect to securities outstanding as of the date of the
Prospectus), and all the issued and outstanding capital stock of the
Company has been authorized and validly issued and is fully paid and
non-assessable and conforms to the descriptions thereof contained in
the Prospectus.
(v) Each Significant Subsidiary of the Company has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has the
corporate power and authority to own, lease and operate its properties
and to conduct its business as described in the Prospectus, and is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify or be in
good standing would not have a Material Adverse Effect; all of the
issued and outstanding capital stock of each such Significant
Subsidiary of the Company has been authorized and validly issued, is
fully paid and non-assessable and, except as set forth in the
Prospectus, all such shares are owned by the Company, directly or
through its subsidiaries, free and clear of any material security
interest, mortgage, pledge, lien, encumbrance, claim or equity.
(vi) All legally required proceedings in connection with the
authorization and valid issuance of the Notes and the sale of such
Notes in accordance with this Agreement (other than the filing of
post-issuance reports, the non-filing of which would not render the
Notes invalid) have been taken and all legally required orders,
consents or other authorizations or approvals of any other public
boards or bodies
-17-
<PAGE>
(including, without limitation, any insurance regulatory agency or
body) in connection with the authorization and valid issuance of the
respective Notes and the sale of such Notes in accordance with this
Agreement (other than in connection with or in compliance with the
provisions of the securities or Blue Sky laws of any jurisdictions, as
to which no opinion need be expressed) have been obtained and are in
full force and effect.
(vii) Each of the Registration Statement and the Previous
Registration Statement is effective under the 1933 Act and, to the
knowledge of such counsel, no stop order suspending the effectiveness
of the Registration Statement or the Previous Registration Statement
has been issued under the 1933 Act, and no proceedings therefor have
been initiated or threatened by the Commission.
(viii) Each of the Registration Statement and the Previous
Registration Statement, as of its respective effective date, and the
Prospectus, and each amendment or supplement thereto as of its issue
date (in each case, other than the financial statements and the notes
thereto, the financial schedules, and any other financial data included
or incorporated by reference therein, as to which such counsel need
express no belief), complied as to form in all material respects with
the requirements of the 1933 Act and the 1933 Act Regulations; and the
Indenture complied as to form in all material respects with the
requirements of the 1939 Act and the 1939 Act Regulations.
(ix) Each of the documents incorporated by reference in the
Registration Statement, the Previous Registration Statement or the
Prospectus at the time they were filed or last amended (other than the
financial statements and the notes thereto, the financial schedules,
and any other financial data included or incorporated by reference
therein and the Statements of Eligibility on Form T-1 filed with the
Commission as part of the Registration Statement or the Previous
Registration Statement, as to which such counsel need express no
belief), complied as to form in all material respects with the
requirements of the 1934 Act and the 1934 Act Regulations, as
applicable.
(x) The information in the Prospectus under the captions
"Description of the Notes," to the extent it involves matters of law,
summaries of legal matters, documents or proceedings or legal
conclusions, has been reviewed by such counsel and is correct in all
material respects.
(xi) This Agreement has been duly authorized, executed and
delivered by the Company.
-18-
<PAGE>
(xii) The Indenture has been duly authorized, executed and
delivered by the Company and, assuming authorization, execution, and
delivery thereof by the Trustee, constitutes a valid and legally
binding obligation of the Company, enforceable against the Company in
accordance with its terms, except to the extent that enforcement
thereof may be limited by the Bankruptcy Exceptions; and the Indenture
has been duly qualified under the 1939 Act and conforms in all material
respects to the description thereof contained in the Prospectus.
(xiii) The 2002 Notes and the 2006 Notes are in the form
contemplated by the Indenture, have been duly authorized, executed and
delivered by the Company and, when authenticated by the Trustee in the
manner provided for in the Indenture and delivered against payment
therefor by the Company, will constitute valid and legally binding
obligations of the Company, enforceable against the Company in
accordance with their respective terms, except to the extent that
enforcement thereof may be limited by the Bankruptcy Exceptions, and
such Notes conform in all material respects to the description thereof
contained in the Prospectus.
(xiv) The offer of the Notes as contemplated herein and in
the Prospectus; the execution, delivery and performance of this
Agreement and the Indenture, and the consummation of the transactions
contemplated herein, therein and in the Registration Statement and the
Previous Registration Statement (including the issuance and sale of the
Notes and the use of proceeds from the sale of the Notes as described
in the prospectus under the caption "Use of Proceeds") and compliance
by the Company with its obligations hereunder and thereunder have been
authorized by all necessary corporate action and do not and will not,
whether with or without the giving of notice or passage of time or
both, conflict with or constitute a breach of any of the terms or
provisions of, or constitute a default or Repayment Event under, or
result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any Significant
Subsidiary pursuant to, the Agreements and Instruments (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not result in a Material Adverse Effect), nor will such action
result in any violation of any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any Significant Subsidiary or any of
their assets, properties, or operations (except for such violations
that would not result in a Material Adverse Effect), nor will such
action result in any violation of the provisions of the charter or
by-laws of the Company or any Significant Subsidiary.
-19-
<PAGE>
(xv) To such counsel's knowledge, there are no statutes
required to be described in or incorporated by reference in the
Registration Statement or the Previous Registration Statement which are
not described or incorporated by reference; and there are no legal or
governmental proceedings pending or, to such counsel's knowledge,
threatened which are required to be disclosed or incorporated by
reference in the Registration Statement or the Previous Registration
Statement, other than those disclosed or incorporated by reference
therein.
(xvi) To such counsel's knowledge, there are no contracts,
indentures, mortgages, agreements, notes, leases or other instruments
required to be described or referred to or incorporated by reference in
the Registration Statement or the Previous Registration Statement or to
be filed as exhibits thereto other than those described or referred to
or incorporated by reference therein or filed as exhibits thereto; and
the descriptions thereof or references thereto are true and correct in
all material respects.
(xvii) No authorization, approval, consent, order,
registration or qualification of or with any court or federal or state
governmental authority or agency (including, without limitation, any
insurance regulatory agency or body) is required for the issuance and
sale of the Notes by the Company to the Underwriters or the performance
by the Company of its obligations under this Agreement, the Indenture
and the Notes except such as has been obtained and made under the
federal securities laws or state insurance laws or such as may be
required under state or foreign securities or Blue Sky laws.
(xviii) The Company and its subsidiaries possess such
permits, licenses, approvals, consents and other authorizations issued
by the appropriate federal, state, local or foreign regulatory agencies
or bodies (including, without limitation, the Insurance Licenses) that
are material to the Company and its subsidiaries taken as a whole and
are necessary to conduct the business now operated by them; the Company
and its subsidiaries are in compliance with the terms and conditions of
all such Insurance Licenses, except where the failure so to comply
would not, singly or in the aggregate, result in a Material Adverse
Effect; all of the Insurance Licenses are valid and in full force and
effect, except where the invalidity of such Insurance Licenses or the
failure of such Insurance Licences to be in full force and effect would
not result in a Material Adverse Effect; and neither the Company nor
any of its subsidiaries has received any notice of proceedings relating
to the revocation or modification of any such Insurance Licenses which,
singly or in the aggregate, may reasonably be expected to result in a
Material Adverse Effect.
-20-
<PAGE>
(xix) Neither the Company nor any of its subsidiaries is, and
upon the issuance and sale of the Notes as herein contemplated and the
application of the net proceeds therefrom as described in the
Prospectus will be, an "investment company" as such term is defined in
the 1940 Act.
Moreover, such counsel shall confirm that nothing has come to such
counsel's attention that causes such counsel to believe that the
Registration Statement or the Previous Registration Statement,
including any information provided pursuant to Rule 430A and related
schedules and Rule 434 (except for financial statements and the notes
thereto, the financial schedules and any other financial data included
or incorporated by reference therein, and the Statements of Eligibility
on Form T-1 filed with the Commission as part of the Registration
Statement or the Previous Registration Statement as to which such
counsel need express no opinion), at the time it became effective or at
the Representation Date, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or that the
Prospectus (except for financial statements and the notes thereto, the
financial schedules, and any other financial data included or
incorporated by reference therein, as to which such counsel need
express no opinion), at the Representation Date (unless the term
"Prospectus" refers to a prospectus which has been provided to the
Underwriters by the Company for use in connection with the offering of
the Notes which differs from the Prospectus on file at the Commission
at the time the Registration Statement and the Previous Registration
Statement became effective, in which case at the time it is first
provided to the Underwriters for such use) or at the Closing Time,
included (or includes) an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which
they were made, not misleading.
(2) The favorable opinion, dated as of the Closing Time, of
LeBoeuf, Lamb, Greene & MacRae, L.L.P., counsel for the Underwriters, in form
and substance satisfactory to the Underwriters, with respect to the issuance and
sale of the Notes, and other related matters as the Underwriters may reasonably
require, and the Company shall have furnished to such counsel such documents as
they request for the purpose of enabling them to pass upon such matters. In
rendering such opinion, LeBoeuf, Lamb, Greene & MacRae, L.L.P. may rely as to
matters governed by the laws of Indiana upon the opinion referred to in Section
5(b)(1) hereto.
(c) Between the date of this Agreement and prior to the Closing Time,
no material adverse change shall have occurred in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and its subsidiaries, considered as one enterprise, whether or not in
the ordinary course of business.
-21-
<PAGE>
(d) At the Closing Time, the Underwriters shall have received a
certificate of the President or a Vice-President of the Company and of the Chief
Financial Officer or Chief Accounting Officer of the Company, dated as of the
Closing Time, to the effect that (i) there has been no material adverse change
in the condition, financial or otherwise, or in the earnings, business affairs
or business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not in the ordinary course of business, (ii) the
representations and warranties in Section 1 hereof are true and correct as
though expressly made at and as of the Closing Time, (iii) the Company has
complied with all agreements and satisfied all conditions on their part to be
performed or satisfied at or prior to the Closing Time, and (iv) no stop order
suspending the effectiveness of the Registration Statement or the Previous
Registration Statement has been issued and no proceedings for that purpose have
been initiated or, to the knowledge of such officers, threatened by the
Commission.
(e) At the time of the execution of this Agreement, the Underwriters
shall have received from PricewaterhouseCoopers LLP a "comfort letter", with
respect to the financial information of the Company, dated such date in form and
substance satisfactory to the Underwriters and counsel to the Underwriters.
(f) At the time of the execution of this Agreement, the Underwriters
shall have received from KPMG LLP a "comfort letter", with respect to the
financial information of Green Tree, dated such date in form and substance
satisfactory to the Underwriters and counsel to the Underwriters.
(g) At the Closing Time, the Underwriters shall have received from each
of PricewaterhouseCoopers LLP, with respect to the Company, and KPMG LLP, with
respect to Green Tree, a letter, dated as of the Closing Time, to the effect
that they reaffirm the statements made in the letters furnished pursuant to
subsections (e) and (f) of this Section and other customary matters, except that
(i) such statements shall include any financial statements and pro forma
financial information incorporated by reference in the Registration Statement,
the Previous Registration Statement and the Prospectus which are filed
subsequent to the date of this Agreement and prior to the Closing Time and (ii)
the specified date referred to shall be a date not more than five days prior to
the Closing Time.
(h) At the Closing Time, counsel for the Underwriters shall have been
furnished with such documents and opinions as they may require for the purpose
of enabling them to pass upon the issuance and sale of the Notes as herein
contemplated and related proceedings, or in order to evidence the accuracy of
any of the representations or warranties, or the fulfillment of any of the
conditions herein contained; and all proceedings taken by the Company in
connection with the
-22-
<PAGE>
issuance and sale of the Notes as herein contemplated shall be satisfactory in
form and substance to the Underwriters and counsel for the Underwriters.
(i) At the Closing Time, the Notes shall be rated at least BBB+ by Duff
& Phelps Credit Rating Agency and BBB+ by Standard & Poor's Ratings Service, and
the Company shall have delivered to the Underwriters a letter, dated the Closing
Time, from each such rating agency, or other evidence satisfactory to the
Underwriters, confirming that the Notes have such ratings; and between the
Representation Date and the Closing Time (i) there shall not have occurred any
decrease in the rating assigned to the Notes or any securities of the Company or
of the financial strength or claims paying ability of the Company by any
"nationally recognized statistical rating organization," as defined for purposes
of Rule 436(g)(2) under the 1933 Act Regulations and (ii) no such organization
shall have publicly announced that it has under surveillance or review, without
indicating an improvement, its rating of the Notes or any securities of the
Company or of the financial strength or claims paying ability of the Company.
If any condition specified in this Section 5 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Underwriters by notice to the Company at any time at or prior to the
Closing Time and such termination shall be without liability of any party to any
other party except as provided in Section 4 and except that Sections 1, 6, 7 and
8 shall survive any such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) The Company agrees to indemnify and hold harmless each Underwriter
and each person, if any, who controls any Underwriter within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement or the Previous Registration Statement (or any amendment
thereto), including the Rule 434 Information deemed to be part thereof,
if applicable, or the omission or alleged omission therefrom of a
material fact required to be stated therein or necessary to make the
statements therein not misleading or arising out of any untrue
statement or alleged untrue statement of a material fact included in
any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto), or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
-23-
<PAGE>
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever arising out of or based upon any such untrue
statement or omission, or any such alleged untrue statement or
omission, provided, that (subject to Section 6(d) below) any such
settlement is effected with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by the
Representatives), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever arising out of or based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to the
extent that any such expense is not paid under (i) or (ii) above;
provided, however, that the foregoing indemnity agreement shall not
apply to any loss, liability, claim, damage or expense to the extent
arising out of or based upon any untrue statement or omission or
alleged untrue statement or omission (A) made in reliance upon and in
conformity with written information furnished to the Company by any
Underwriter through the Representatives expressly for use in the
Registration Statement or the Previous Registration Statement (or any
amendment thereto), including the Rule 434 Information deemed to be a
part thereof, if applicable, or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto), (B) made in any
Statement of Eligibility on Form T-1 filed as an exhibit to the
Registration Statement or the Previous Registration Statement or (C)
made in any preliminary prospectus supplement and corrected in the
Prospectus, as supplemented, where the person asserting any such loss,
liability, claim, damage or expense purchased the Notes that are the
subject thereof, and it shall have been established (i) that there was
not sent or given, at or prior to the written confirmation of such
sale, a copy of the Prospectus (excluding documents incorporated by
reference) in any case where such delivery is required by the 1933 Act
and (ii) the Company shall have previously furnished copies thereof in
sufficient quantities to such Underwriter.
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Company, its directors, each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act against any and all
loss, liability, claim, damage and expense described in the indemnity contained
in subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement or the Previous Registration Statement (or any amendment
thereto), including the Rule
-24-
<PAGE>
434 Information deemed to be a part thereof, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information furnished to the
Company by such Underwriter through the Representatives expressly for use in the
Registration Statement or the Previous Registration Statement (or any amendment
thereto) or such preliminary prospectus or the Prospectus (or any amendment or
supplement thereto).
(c) Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability
hereunder to the extent it is not materially prejudiced as a result thereof and
in any event shall not relieve it from any liability which it may have otherwise
than on account of this indemnity agreement. In the case of parties indemnified
pursuant to Section 6(a) above, counsel to the indemnified parties shall be
selected by the Representatives, and, in the case of parties indemnified
pursuant to Section 6(b) above, counsel to the indemnified parties shall be
selected by the Company. An indemnifying party may participate at its own
expense in the defense of any such action; provided, however, that counsel to
the indemnifying party shall not (except with the consent of the indemnified
party) also be counsel to the indemnified party. In no event shall the
indemnifying parties be liable for fees and expenses of more than one counsel
(in addition to any local counsel) separate from their own counsel for all
indemnified parties in connection with any one action or separate but similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any litigation, or any investigation
or proceeding by any governmental agency or body, commenced or threatened, or
any claim whatsoever in respect of which indemnification or contribution could
be sought under this Section 6 or Section 7 hereof (whether or not the
indemnified parties are actual or potential parties thereto), unless such
settlement, compromise or consent (i) includes an unconditional release of each
indemnified party from all liability arising out of such litigation
investigation, proceeding or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act by or on behalf of any
indemnified party.
(d) If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by Section 6(a)(ii) effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance
-25-
<PAGE>
with such request prior to the date of such settlement. Notwithstanding the
immediately preceding sentence, if at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified party for fees and
expenses of counsel, an indemnifying party shall not be liable for any
settlement of the nature contemplated by Section 6(a)(ii) affected without its
consent if such indemnifying party (i) reimburses such indemnified party in
accordance with such request to the extent it considers such request to be
reasonable and (ii) provides written notice to the indemnified party
substantiating the unpaid balance as unreasonable, in each case prior to the
date of such settlement.
SECTION 7. Contribution. If the indemnification provided for in Section
6 hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand, and the Underwriters, on the other hand, from the offering of the Notes
pursuant to this Agreement or (ii) if the allocation provided by clause (i) is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company on the one hand, and the Underwriters, on the
other hand, in connection with the statements or omissions which resulted in
such losses, liabilities, claims, damages or expenses, as well as any other
relevant equitable considerations.
The relative benefits received by Company on the one hand, and the
Underwriters, on the other hand, in connection with the offering of the Notes
pursuant to this Agreement shall in each case be deemed to be in the same
respective proportions as the total net proceeds from the offering of such Notes
(before deducting expenses) received by the Company and the total underwriting
discount received by the Underwriters in respect of such Notes, in each case as
set forth on the cover of the Prospectus, or, if Rule 434 is used, the
corresponding location on the Term Sheet, bear to the aggregate initial public
offering price of such Notes as set forth on such cover.
The relative fault of the Company, on the one hand, and the
Underwriters, on the other hand, shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
-26-
<PAGE>
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Notes underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the 1933 Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as the Company. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the aggregate principal amount of Notes set forth opposite their
respective names in Schedule A to this Agreement, and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or contained in certificates of officers of the Company submitted
pursuant hereto, shall remain operative and in full force and effect, regardless
of any investigation made by or on behalf of any Underwriter or controlling
person, or by or on behalf of the Company, and shall survive delivery of and
payment for the Notes to the Underwriters.
-27-
<PAGE>
SECTION 9. Termination of Agreement.
(a) The Underwriters may terminate this Agreement, by notice to the
Company at any time at or prior to the Closing Time, if (i) there has been,
since the date of this Agreement or since the respective dates as of which
information is given in the Prospectus, any material adverse change or any
development which could reasonably be expected to result in a prospective
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) there has occurred any material adverse
change in the financial markets in the United States or any outbreak of
hostilities or escalation of hostilities or other calamity or crisis, or any
change or development involving a prospective change in national or
international political, financial or economic conditions the effect of which is
such as to make it, in the judgment of the Representatives, impracticable to
market the Notes or to enforce contracts for the sale of the Notes, or (iii) if
trading in the Common Stock or any other security of the Company has been
suspended or limited by the Commission, NASD or the New York Stock Exchange, or
if trading generally on either the American Stock Exchange, the New York Stock
Exchange or in the over-the-counter market has been suspended or limited, or
minimum or maximum prices for trading have been fixed, or maximum ranges for
prices for securities have been required, by either of such exchanges or by such
system or by order of the Commission, NASD or any other governmental authority,
or (iv) if a banking moratorium has been declared by either Federal, New York or
Indiana authorities.
(b) If this Agreement is terminated pursuant to this Section 9, such
termination shall be without liability of any party to any other party except as
provided in Section 4, and provided, further, that Sections 1, 6, 7 and 8 shall
survive such termination and remain in full force and effect.
SECTION 10. Default by One or More of the Underwriters. If one or more
of the Underwriters shall fail at the Closing Time to purchase the Notes which
it or they are obligated to purchase under this Agreement (the "Defaulted
Notes"), the Representatives shall have the right, within 24 hours thereafter,
to make arrangements for one or more of the non-defaulting Underwriters, or any
other underwriters, to purchase all, but not less than all, of the Defaulted
Notes in such amounts as may be agreed upon and upon the terms herein set forth;
if, however, the Representatives shall not have completed such arrangements
within such 24-hour period, then:
(a) if the aggregate principal amount of Defaulted Notes does not
exceed 10% of the total aggregate principal amount of Notes, the non-defaulting
Underwriters shall be obligated,
-28-
<PAGE>
severally and not jointly, to purchase the full amount thereof in the
proportions that their respective underwriting obligations hereunder bear to the
underwriting obligations of all non-defaulting Underwriters, or
(b) if the aggregate principal amount of Defaulted Notes exceeds 10% of
the total aggregate principal amount of the Notes to be purchased on such date,
this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter.
No action taken pursuant to this Section 10 shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement, either the Representatives or the Company shall have the
right to postpone the Closing Time for a period not exceeding seven days in
order to effect any required changes in the Registration Statement, the Previous
Registration Statement or the Prospectus or in any other documents or
arrangements. As used herein, the term "Underwriter" includes any person
substituted for an Underwriter under this Section 10.
SECTION 11. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Underwriters c/o Chase Securities Inc.,
270 Park Avenue, 8th Floor, New York, New York, 10017, Attention of Louis
DeCaro, and to Lehman Brothers Inc., 3 World Financial Center, New York, New
York 10285, Attention of David C. Sherwood, with a copy to LeBoeuf, Lamb, Greene
& MacRae, L.L.P., 125 West 55th Street, New York, New York, 10019, Attention of
Michael Groll, Esq.; notices to the Company shall be directed to the Company at
Conseco, Inc., 11825 N. Pennsylvania Street, Carmel, Indiana 46032, Attention of
John J. Sabl, Esq., Executive Vice President, General Counsel and Secretary. In
addition, copies of any notice pursuant to Section 6(c) hereof shall be sent to
Chase Securities Inc., 1 Chase Manhattan Plaza, 26th Floor, New York, New York
10081, Attention of Legal Department.
SECTION 12. Parties. This Agreement shall inure to the benefit of and
be binding upon the Company and the Underwriters and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriters and the Company and their respective successors and the controlling
persons and officers and directors referred to in Sections 6 and 7 and their
heirs and legal representatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision herein or therein
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the parties hereto and
-29-
<PAGE>
thereto and their respective successors and legal representatives, and said
controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation. No
purchaser of Notes from any Underwriter shall be deemed to be a successor by
reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED
TIMES OF DAY REFER TO NEW YORK CITY TIME UNLESS OTHERWISE INDICATED.
SECTION 14. Effect of Headings. The Article and Section headings herein
are for convenience only and shall not affect the construction hereof.
SECTION 15. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts hereof shall constitute a single instrument.
-30-
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, shall become a binding agreement
among the Company and the Underwriters in accordance with its terms.
Very truly yours,
CONSECO, INC.
By: /s/ Rollin M. Dick
-------------------------------
Name: Rollin M. Dick
Title: Executive Vice President
and Chief Financial
Officer
CONFIRMED AND ACCEPTED,
as of the date first above written:
CHASE SECURITIES INC.
LEHMAN BROTHERS
as Representatives of the several Underwriters
By: LEHMAN BROTHERS INC.
By: /s/ Jeff Weiss
-------------------------------
Authorized Signatory
By: CHASE SECURITIES INC.
By: /s/ Louis DeCaro
-------------------------------
Authorized Signatory
-31-
<PAGE>
Schedule A
Principal Principal
Amount of Amount of
2002 2006
Underwriters Notes Notes
------------ ------- -----
Chase Securities Inc........................ $157,500,000 $192,500,000
Lehman Brothers Inc......................... 157,500,000 192,500,000
Credit Suisse First Boston Corporation...... 45,000,000 55,000,000
Merrill Lynch, Pierce, Fenner & Smith
Incorporated................. 45,000,000 55,000,000
Warburg Dillon Read LLC..................... 45,000,000 55,000,000
------------ ------------
Total...................... $450,000,000 $550,000,000
============ ============
-32-
<PAGE>
Schedule B
Significant Subsidiaries
------------------------
Conseco Life Insurance Company of Texas
CIHC, Incorporated
Bankers Life Insurance Company of Illinois
Bankers Life and Casualty Company
Conseco Annuity Assurance Company
Conseco Senior Health Insurance Company
Wabash Life Insurance Company
Green Tree Financial Corporation
Conseco Health Insurance Company
Conseco Life Insurance Company
-33-
Unless this certificate is presented by an authorized representative of
The Depository Trust Company, a New York corporation (the "Depository"), to the
Company or its agent for registration of transfer, exchange, or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other name
as is requested by an authorized representative of the Depository (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of the Depository), ANY TRANSFER, PLEDGE, OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein.
REGISTERED REGISTERED
CONSECO, INC.
8.5% NOTE DUE OCTOBER 15, 2002
CUSIP 208464AQ0
No. 1 US$ 200,000,000
CONSECO, INC., a corporation duly organized and existing under the
laws of Indiana (herein called the "Company," which term includes any successor
corporation under the Indenture hereinafter referred to), for value received,
hereby promises to pay to Cede & Co. or registered assigns, the principal sum of
Two Hundred Million Dollars ($200,000,000) on October 15, 2002, and to pay
interest thereon from October 21, 1999 or from the most recent Interest Payment
Date (as hereinafter defined) to which interest has been paid or duly provided
for, as the case may be.
Interest will be payable on April 15 and October 15 of each year
(each an "Interest Payment Date"), at the rate of 8.5% per annum, commencing
April 15, 2000 (except as provided below) until the principal hereof becomes due
and payable. Interest payments will be made in an amount equal to the amount
accrued from and including the immediately preceding Interest Payment Date in
respect of which interest has been paid or duly made available for payment (or
from and including the date of issue, if no interest has been paid or duly made
available for payment) to but excluding the applicable Interest Payment Date or
Maturity. The interest so payable and punctually paid or duly provided for, on
any Interest Payment Date will, as provided in the Indenture, be paid to the
Person in whose name this Note (or one or more predecessor Notes) is registered
at the close of business on the Regular Record Date for such interest payment,
which shall be the April 1 or October 1 (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date. Except as otherwise
provided in the Indenture, any such interest not so punctually paid or duly
provided for will forthwith cease to be payable to the Holder on such Regular
Record Date by virtue of their having been such Holder and may either be paid to
the Person in whose name this Note (or one or more predecessor Notes) is
registered at the close of business on a Special Record Date for
1
<PAGE>
the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof is to be given to Holders of Notes not less than 10 calendar days prior
to such Special Record Date, or be paid at any time in any other lawful manner
not inconsistent with the requirements of any securities exchange on which Notes
of this series may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in said Indenture.
If any Interest Payment Date(s) or the date of Maturity falls on a
day that is not a Business Day, the required payment of principal, premium, if
any, and/or interest will be made on the next succeeding Business Day as if made
on the date such payment was due, and no interest will accrue on such payment
for the period from and after such Interest Payment Date or the date of
Maturity, as the case may be, to the date of such payment on the next succeeding
Business Day.
While this Note is represented by one or more global notes
registered in the name of the Depository or its nominee, the Company will cause
payments of principal of, premium, if any, and interest on this Note to be made
to the Depository or its nominee, as the case may be, by wire transfer to the
extent, in the funds and in the manner required by agreements with, or
regulations or procedures prescribed from time to time by, the Depository or its
nominee, and otherwise in accordance with such agreements, regulations and
procedures. THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY
OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE
DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR OF THE
DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR.
Unless the certificate of authentication hereon has been executed
by the Trustee referred to herein, or its successor as Trustee, or its
Authenticating Agent, by manual signature of an authorized signatory, this Note
will not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
This Note is one of a duly authorized issue of securities of the
Company (the "Securities") issued under an indenture, dated as of November 13,
1997, as amended from time to time (the "Indenture"), between the Company and
The Bank of New York (successor to LTCB Trust Company), as trustee (the
"Trustee"), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights, limitations of rights,
duties and immunities thereunder of the Company, the Trustee and the Holders of
the Notes and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Note is one of the Securities designated on
the face hereof limited in aggregate principal amount to $450,000,000.
The Notes of this series will be redeemable as a whole or in part
at the option of the Company at any time, at a redemption price equal to the sum
of (a) the greater of (i) 100% of the principal amount of such Notes and (ii)
the sum of the present values of the remaining scheduled payments of principal
and interest thereon from the redemption date to the date of Maturity, computed
by discounting such payments, in each case, to the redemption date on a
semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at
the Treasury Rate, plus 25 basis
2
<PAGE>
points, plus (b) accrued and unpaid interest on the principal amount thereof to
the date of redemption.
"Treasury Rate" means, with respect to any redemption date, the
rate per annum equal to the semi-annual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such redemption date.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Notes to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of such Notes. "Independent Investment Banker"
means one of the Reference Treasury Dealers appointed by the Trustee after
consultation with the Company.
"Comparable Treasury Price" means, with respect to any redemption
date, (i) the average of the bid and asked prices for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) on the
third Business Day preceding such redemption date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Securities" or (ii) if such release (or any successor release) is not
published or does not contain such prices on such Business Day, the average of
the Reference Treasury Dealer Quotations actually obtained by the Trustee for
such redemption date. "Reference Treasury Dealer Quotations" means, with respect
to each Reference Treasury Dealer and any redemption date, the average, as
determined by the Trustee, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m.
(New York City time) on the third Business Day preceding such redemption date.
"Reference Treasury Dealer" means each of Chase Securities Inc.,
Lehman Brothers Inc., Credit Suisse First Boston Corporation, Merrill Lynch,
Pierce, Fenner & Smith Incorporated and Warburg Dillon Read LLC and their
respective successors; provided, however, that if any of the foregoing shall
cease to be a primary U.S. Government securities dealer in New York City (a
"Primary Treasury Dealer"), the Company may substitute therefor another Primary
Treasury Dealer.
Notice of any redemption will be mailed at least 30 days but no
more than 60 days before the redemption date to each holder of Notes to be
redeemed. If, at the time notice of redemption is given, the redemption moneys
are not held by the Trustee, the redemption may be made subject to their receipt
on or before the date fixed for redemption and such notice shall be of no effect
unless such moneys are so received.
Upon payment of the redemption price, on and after the redemption
date interest will cease to accrue on this Note or portions hereof called for
redemption.
3
<PAGE>
The Notes of this series contain the following covenants:
Limitations on Issuance or Disposition of Stock of Significant
Subsidiaries. The Company will not, nor will it permit any Significant
Subsidiary to, issue, sell or otherwise dispose of any shares of Capital Stock
(other than non-voting Preferred Stock) of any Significant Subsidiary, except
for (i) directors' qualifying shares; (ii) sales or other dispositions to the
Company or to one or more wholly owned Significant Subsidiaries; (iii) the sale
or other disposition of all or any part of the Capital Stock of any Significant
Subsidiary for consideration which is at least equal to the fair value of such
Capital Stock as determined by the Company's board of directors (acting in good
faith); or (iv) any issuance, sale, assignment, transfer or other disposition
made in compliance with an order of a court or regulatory authority of competent
jurisdiction, other than an order issued at the request of the Company or any
Significant Subsidiary.
Limitation on Liens. Except as provided below, neither the Company
nor any Significant Subsidiary may incur, issue, assume or guarantee any
Indebtedness secured by a Lien on any property or assets of the Company or any
Significant Subsidiary, or any shares of Capital Stock of any Significant
Subsidiary, without effectively providing that the Notes (together with, if the
Company shall so determine, any other Indebtedness which is not subordinated to
the Notes) shall be secured equally and ratably with (or prior to) such
Indebtedness, so long as such Indebtedness shall be so secured; provided,
however, that this covenant shall not apply to Indebtedness secured by (i) Liens
existing on October 18, 1999; (ii) Liens on property of, or on any shares of
stock of, any corporation existing at the time such corporation becomes a
Significant Subsidiary or merges into or consolidates with the Company or a
Significant Subsidiary; (iii) Liens on property or on shares of stock existing
at the time of acquisition thereof by the Company or any Significant Subsidiary;
(iv) Liens to secure the financing of the acquisition, construction or
improvement of property, or the acquisition of shares of stock by the Company or
any Significant Subsidiary, provided that such Liens are created not later than
one year after such acquisition or, in the case of property, no later than one
year after completion of construction or commencement of commercial operation,
whichever is later, are limited to the property acquired, constructed or
improved or the shares of stock acquired and do not secure indebtedness in
excess of the cost of such acquisition, construction or improvement; (v) Liens
in favor of the Company or any Subsidiary; (vi) Liens in favor of, or required
by, governmental authorities; and (vii) any extension, renewal or replacement as
a whole or in part, of any Lien referred to in the foregoing clauses (i) to (vi)
inclusive; provided, however, that (a) such extension, renewal or replacement
Lien shall be limited to all or a part of the same property or shares of stock
that secured the Lien extended, renewed or replaced and (b) the Indebtedness
secured by such Lien at such time is not so increased.
The restrictions in the immediately preceding paragraph do not
apply if, immediately after the incurrence, issuance, assumption or guarantee of
any Indebtedness secured by a Lien, the aggregate principal amount of such
secured Indebtedness, (other than Indebtedness secured by Liens described in
clauses (i) to (vii), inclusive, of the immediately preceding paragraph) at that
time would not exceed 10% of Consolidated Capitalization.
4
<PAGE>
"Capital Lease Obligations" of a Person means any obligation that
is required to be classified and accounted for as a capital lease on the face of
a balance sheet of such Person prepared in accordance with generally accepted
accounting principles; the amount of such obligations shall be the capitalized
amount thereof, determined in accordance with generally accepted accounting
principles; and the Stated Maturity thereof shall be the date of the last
payment of rent or any other amount due under such lease prior to the first date
upon which such lease may be terminated by the lessee without payment of a
penalty.
"Capital Stock" means any and all shares, interests, rights to
purchase, warrants, options, participations or other equivalents of or interest
in (however designated) corporate stock, including any Preferred Stock.
"Consolidated Capitalization" means the sum of the Company's
consolidated shareholders' equity, redeemable preferred stock and preferred
securities in any trust, partnership, corporation or other entity of which more
than 50% of the voting equity is owned directly or indirectly by the Company,
including, without limitation, the trust securities issued by Conseco Financing
Trust I, Conseco Financing Trust II, Conseco Financing Trust III, Conseco
Financing Trust IV, Conseco Financing Trust V, Conseco Financing Trust VI,
Conseco Financing Trust VII and Conseco Financing Trust XI.
"Indebtedness" means (i) any liability of any Person (1) for
borrowed money, or under any reimbursement obligation relating to a letter of
credit (other than letters of credit obtained in the ordinary course of
business), or (2) evidenced by a bond, note, debenture or similar instrument
(including a purchase money obligation) given in connection with the acquisition
of any businesses, properties or assets of any kind or with services incurred in
connection with capital expenditures (other than accounts payable or other
indebtedness to trade creditors arising in the ordinary course of business), or
(3) for the payment of money relating to a Capital Lease Obligation; (ii) any
liability of others described in the preceding clause (i) that the Person has
guaranteed or that is otherwise its legal liability; and (iii) any amendment,
supplement, modification, deferral, renewal, extension or refunding of any
liability of types referred to in clauses (i) and (ii) above.
"Lien" means any lien, mortgage, pledge, security interest, charge
or encumbrance of any kind (including any conditional sale or other title
retention agreement and any lease in the nature thereof).
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock or limited liability company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Preferred Stock," as applied to the Capital Stock of any
corporation, means Capital Stock of any class or classes (however designated)
which is preferred as to the payment of dividends, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
5
<PAGE>
"Significant Subsidiary" means any Subsidiary with net earnings
which constituted at least 20% of the Company's consolidated total net earnings,
all as determined as of the date of the Company's most recently prepared
quarterly financial statements for the 12-month period then ended.
"Stated Maturity," when used with respect to any security or any
installment of interest on any security, means the date specified in such
security as the fixed date on which the principal of such security or such
installment of interest, respectively, is finally due and payable, except as
otherwise provided in the case of Capital Lease Obligations.
"Subsidiary" means a corporation of which a majority of the
Capital Stock having voting power under ordinary circumstances to elect a
majority of the board of directors is owned directly or indirectly by the
Company or by one or more Subsidiaries, or by the Company and one or more
Subsidiaries.
If any Event of Default with respect to Notes of this series will
occur and be continuing, the principal of the Notes of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of not less than a majority in
aggregate principal amount of the outstanding Securities of each series to be
affected. The Indenture also contains provisions permitting the Holders of
specified percentages in principal amount of the outstanding Securities of each
series, on behalf of the Holders of all Securities of such series, to waive,
with respect to the Securities of such series, compliance by the Company with
certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Note will be conclusive and binding upon such Holder and upon all future
Holders of this Note and of any Note issued upon the registration of transfer
hereof or in exchange therefore or in lieu hereof, whether or not notation of
such consent or waiver is made upon this Note.
Holders of Notes may not enforce their rights pursuant to the
Indenture or the Notes except as provided in the Indenture. No reference herein
to the Indenture and no provision of this Note or of the Indenture will alter or
impair the obligation of the Company, which is absolute and unconditional, to
pay the principal of, and premium, if any, and interest on this Note at the
times, places and rates, herein prescribed.
The Indenture contains provisions for defeasance at any time of
(a) the entire indebtedness of the Company on this Note and (b) certain
restrictive covenants and the related Events of Default upon compliance by the
Company with certain conditions specified therein, which provisions apply to
this Note.
6
<PAGE>
The Notes of this series are issuable only in global or
certificated registered form, without coupons, in denominations of $1,000 and
integral multiples thereof. As provided in the Indenture and subject to certain
limitations therein specified and to the limitations described below, if
applicable, Notes of this series are exchangeable for Notes of this series of
like aggregate principal amount of a different authorized denomination, as
requested by the Holder surrendering the same.
As provided in the Indenture and subject to certain limitations
therein specified and to the limitations described below, if applicable, the
transfer of this Note is registerable in the Security Register upon surrender of
this Note for registration of transfer at the office or agency of the Company
maintained for that purpose duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar (which will initially be the Trustee at its principal corporate trust
office located in the Borough of Manhattan, The City of New York) duly executed
by the Holder hereof or his attorney duly authorized in writing, and thereupon
one or more new Notes of this series with like terms and conditions, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
This Note is exchangeable for certificated Notes only upon the
terms and conditions provided in the Indenture. Except as provided in the
Indenture, owners of beneficial interests in this Note will not be entitled to
receive physical delivery of Notes in certificated registered form and will not
be considered the Holders thereof for any purpose under the Indenture.
This Note is in the form of a Global Security as provided in the
Indenture. If at any time the Depository notifies the Company that it is
unwilling or unable to continue as Depository for this Note or if at any time
the Depository for this series shall no longer be eligible or in good standing
under the Securities Exchange Act of 1934, as amended, or other applicable
statute or regulation, the Company shall appoint a successor Depository with
respect to this Note. If a successor Depository for this Note is not appointed
by the Company within 90 days after the Company receives notice or becomes aware
of such ineligibility, the Company will execute, and the Trustee or its agent,
upon receipt of a Company Request for the authentication and delivery of
certificates representing Securities of this series in exchange for this
Security will authenticate and deliver, certificates representing securities of
this series of like tenor and terms in an aggregate principal amount equal to
the principal amount of this Note in exchange for this Note.
If specified by the Company pursuant to the Indenture with respect
to this Note, the Depository may surrender this Note in exchange in whole or in
part for certificates representing Securities of this series of like tenor and
terms in definitive form on such terms as are acceptable to the Company and the
Depository. Thereupon the Company shall execute, and the trustee or its agent
shall authenticate and deliver, without a service charge, (1) to each Holder
specified by the Security Registrar or the Depository a certificate or
certificates representing Securities of this series of like tenor and terms and
of any authorized denomination as requested by such person in an aggregate
principal amount equal to and in exchange for such Holder's beneficial interest
as specified by the security Registrar or the Depository in this Note; and (2)
to the Depository a new Global Security
7
<PAGE>
of like tenor and terms and in an authorized denomination equal to the
difference, if any, between the principal amount of the surrendered Note and the
aggregate principal amount of certificates representing Notes delivered to
Holders thereof.
No service charge will be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Note is registered as the owner hereof
for all purposes, whether or not this Note be overdue and notwithstanding any
notation of ownership or other writing hereon, and none of the Company, the
Trustee or any such agent will be affected by notice to the contrary.
The Indenture and the Notes will be governed by and construed in
accordance with the laws of the State of New York.
All terms used in this Note which are defined in the Indenture
will have the meanings assigned to them in the Indenture unless otherwise
defined herein; and all references in the Indenture to "Security" or
"Securities" will be deemed to include this Note.
8
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Date: October 21, 1999 CONSECO, INC.
By: /s/ Stephen C. Hilbert
--------------------------------
Stephen C. Hilbert, President
[SEAL]
Attest:
By: /s/ John J. Sabl
--------------------------------
John J. Sabl, Secretary
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Dated: October 21, 1999 THE BANK OF NEW YORK,
as Trustee
By: /s/ Michael Culhane
--------------------------------
Authorized Signatory
9
<PAGE>
-----------------
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and
not as tenants in common
UNIF GIFT MIN ACT - Custodian
_____________________________________
(Cust) (Minor)
Under Uniform Gifts to Minors Act
_____________________________________
(State)
Additional abbreviations may also be used though not in the above list.
------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
_____________________________________ the within Security and all rights
thereunder, hereby irrevocably constituting and appointing __________________
attorney to transfer said Security on the books of the Company, with full power
of substitution in the premises.
Date:
______________________
Signature
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE WITHIN INSTRUMENT IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.
THE SIGNATURE(S) MUST BE GUARANTEED BY AN "ELIGIBLE GUARANTOR
INSTITUTION" THAT IS A MEMBER OR PARTICIPANT IN A "SIGNATURE GUARANTEE PROGRAM"
(E.G., THE SECURITIES TRANSFER AGENTS MEDALLION PROGRAM, THE STOCK EXCHANGE
MEDALLION PROGRAM OR THE NEW YORK STOCK EXCHANGE, INC. MEDALLION SIGNATURE
PROGRAM).
10
Unless this certificate is presented by an authorized representative of
The Depository Trust Company, a New York corporation (the "Depository"), to the
Company or its agent for registration of transfer, exchange, or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other name
as is requested by an authorized representative of the Depository (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of the Depository), ANY TRANSFER, PLEDGE, OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein.
REGISTERED REGISTERED
CONSECO, INC.
9% NOTE DUE OCTOBER 15, 2006
CUSIP 208464AR8
No. 1 US$ 200,000,000
CONSECO, INC., a corporation duly organized and existing under the
laws of Indiana (herein called the "Company," which term includes any successor
corporation under the Indenture hereinafter referred to), for value received,
hereby promises to pay to Cede & Co. or registered assigns, the principal sum of
Two Hundred Million Dollars ($200,000,000) on October 15, 2006, and to pay
interest thereon from October 21, 1999 or from the most recent Interest Payment
Date (as hereinafter defined) to which interest has been paid or duly provided
for, as the case may be.
Interest will be payable on April 15 and October 15 of each year
(each an "Interest Payment Date"), at the rate of 9% per annum, commencing April
15, 2000 (except as provided below) until the principal hereof becomes due and
payable. Interest payments will be made in an amount equal to the amount accrued
from and including the immediately preceding Interest Payment Date in respect of
which interest has been paid or duly made available for payment (or from and
including the date of issue, if no interest has been paid or duly made available
for payment) to but excluding the applicable Interest Payment Date or Maturity.
The interest so payable and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in the Indenture, be paid to the Person
in whose name this Note (or one or more predecessor Notes) is registered at the
close of business on the Regular Record Date for such interest payment, which
shall be the April 1 or October 1 (whether or not a Business Day), as the case
may be, next preceding such Interest Payment Date. Except as otherwise provided
in the Indenture, any such interest not so punctually paid or duly provided for
will forthwith cease to be payable to the Holder on such Regular Record Date by
virtue of their having been such Holder and may either be paid to the Person in
whose name this Note (or one or more predecessor Notes) is registered at the
close of business on a Special Record Date for the payment of such Defaulted
Interest to be fixed by the Trustee, notice whereof is to be given to Holders of
Notes not less than 10 calendar days prior to such Special Record Date,
1
<PAGE>
or be paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which Notes of this series may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in said Indenture.
If any Interest Payment Date(s) or the date of Maturity falls on a
day that is not a Business Day, the required payment of principal, premium, if
any, and/or interest will be made on the next succeeding Business Day as if made
on the date such payment was due, and no interest will accrue on such payment
for the period from and after such Interest Payment Date or the date of
Maturity, as the case may be, to the date of such payment on the next succeeding
Business Day.
While this Note is represented by one or more global notes
registered in the name of the Depository or its nominee, the Company will cause
payments of principal of, premium, if any, and interest on this Note to be made
to the Depository or its nominee, as the case may be, by wire transfer to the
extent, in the funds and in the manner required by agreements with, or
regulations or procedures prescribed from time to time by, the Depository or its
nominee, and otherwise in accordance with such agreements, regulations and
procedures. THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY
OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE
DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR OF THE
DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR.
Unless the certificate of authentication hereon has been executed
by the Trustee referred to herein, or its successor as Trustee, or its
Authenticating Agent, by manual signature of an authorized signatory, this Note
will not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
This Note is one of a duly authorized issue of securities of the
Company (the "Securities") issued under an indenture, dated as of November 13,
1997, as amended from time to time (the "Indenture"), between the Company and
The Bank of New York (successor to LTCB Trust Company), as trustee (the
"Trustee"), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights, limitations of rights,
duties and immunities thereunder of the Company, the Trustee and the Holders of
the Notes and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Note is one of the Securities designated on
the face hereof limited in aggregate principal amount to $550,000,000.
The Notes of this series will be redeemable as a whole or in part
at the option of the Company at any time, at a redemption price equal to the sum
of (a) the greater of (i) 100% of the principal amount of such Notes and (ii)
the sum of the present values of the remaining scheduled payments of principal
and interest thereon from the redemption date to the date of Maturity, computed
by discounting such payments, in each case, to the redemption date on a
semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at
the Treasury Rate, plus 25 basis points, plus (b) accrued and unpaid interest on
the principal amount thereof to the date of redemption.
2
<PAGE>
"Treasury Rate" means, with respect to any redemption date, the
rate per annum equal to the semi-annual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such redemption date.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Notes to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of such Notes. "Independent Investment Banker"
means one of the Reference Treasury Dealers appointed by the Trustee after
consultation with the Company.
"Comparable Treasury Price" means, with respect to any redemption
date, (i) the average of the bid and asked prices for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) on the
third Business Day preceding such redemption date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Securities" or (ii) if such release (or any successor release) is not
published or does not contain such prices on such Business Day, the average of
the Reference Treasury Dealer Quotations actually obtained by the Trustee for
such redemption date. "Reference Treasury Dealer Quotations" means, with respect
to each Reference Treasury Dealer and any redemption date, the average, as
determined by the Trustee, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m.
(New York City time) on the third Business Day preceding such redemption date.
"Reference Treasury Dealer" means each of Chase Securities Inc.,
Lehman Brothers Inc., Credit Suisse First Boston Corporation, Merrill Lynch,
Pierce, Fenner & Smith Incorporated and Warburg Dillon Read LLC and their
respective successors; provided, however, that if any of the foregoing shall
cease to be a primary U.S. Government securities dealer in New York City (a
"Primary Treasury Dealer"), the Company may substitute therefor another Primary
Treasury Dealer.
Notice of any redemption will be mailed at least 30 days but no
more than 60 days before the redemption date to each holder of Notes to be
redeemed. If, at the time notice of redemption is given, the redemption moneys
are not held by the Trustee, the redemption may be made subject to their receipt
on or before the date fixed for redemption and such notice shall be of no effect
unless such moneys are so received.
Upon payment of the redemption price, on and after the redemption
date interest will cease to accrue on this Note or portions hereof called for
redemption.
The Notes of this series contain the following covenants:
3
<PAGE>
Limitations on Issuance or Disposition of Stock of Significant
Subsidiaries. The Company will not, nor will it permit any Significant
Subsidiary to, issue, sell or otherwise dispose of any shares of Capital Stock
(other than non-voting Preferred Stock) of any Significant Subsidiary, except
for (i) directors' qualifying shares; (ii) sales or other dispositions to the
Company or to one or more wholly owned Significant Subsidiaries; (iii) the sale
or other disposition of all or any part of the Capital Stock of any Significant
Subsidiary for consideration which is at least equal to the fair value of such
Capital Stock as determined by the Company's board of directors (acting in good
faith); or (iv) any issuance, sale, assignment, transfer or other disposition
made in compliance with an order of a court or regulatory authority of competent
jurisdiction, other than an order issued at the request of the Company or any
Significant Subsidiary.
Limitation on Liens. Except as provided below, neither the Company
nor any Significant Subsidiary may incur, issue, assume or guarantee any
Indebtedness secured by a Lien on any property or assets of the Company or any
Significant Subsidiary, or any shares of Capital Stock of any Significant
Subsidiary, without effectively providing that the Notes (together with, if the
Company shall so determine, any other Indebtedness which is not subordinated to
the Notes) shall be secured equally and ratably with (or prior to) such
Indebtedness, so long as such Indebtedness shall be so secured; provided,
however, that this covenant shall not apply to Indebtedness secured by (i) Liens
existing on October 18, 1999; (ii) Liens on property of, or on any shares of
stock of, any corporation existing at the time such corporation becomes a
Significant Subsidiary or merges into or consolidates with the Company or a
Significant Subsidiary; (iii) Liens on property or on shares of stock existing
at the time of acquisition thereof by the Company or any Significant Subsidiary;
(iv) Liens to secure the financing of the acquisition, construction or
improvement of property, or the acquisition of shares of stock by the Company or
any Significant Subsidiary, provided that such Liens are created not later than
one year after such acquisition or, in the case of property, no later than one
year after completion of construction or commencement of commercial operation,
whichever is later, are limited to the property acquired, constructed or
improved or the shares of stock acquired and do not secure indebtedness in
excess of the cost of such acquisition, construction or improvement; (v) Liens
in favor of the Company or any Subsidiary; (vi) Liens in favor of, or required
by, governmental authorities; and (vii) any extension, renewal or replacement as
a whole or in part, of any Lien referred to in the foregoing clauses (i) to (vi)
inclusive; provided, however, that (a) such extension, renewal or replacement
Lien shall be limited to all or a part of the same property or shares of stock
that secured the Lien extended, renewed or replaced and (b) the Indebtedness
secured by such Lien at such time is not so increased.
The restrictions in the immediately preceding paragraph do not
apply if, immediately after the incurrence, issuance, assumption or guarantee of
any Indebtedness secured by a Lien, the aggregate principal amount of such
secured Indebtedness, (other than Indebtedness secured by Liens described in
clauses (i) to (vii), inclusive, of the immediately preceding paragraph) at that
time would not exceed 10% of Consolidated Capitalization.
"Capital Lease Obligations" of a Person means any obligation that
is required to be classified and accounted for as a capital lease on the face of
a balance sheet of such Person prepared
4
<PAGE>
in accordance with generally accepted accounting principles; the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with generally accepted accounting principles; and the Stated Maturity thereof
shall be the date of the last payment of rent or any other amount due under such
lease prior to the first date upon which such lease may be terminated by the
lessee without payment of a penalty.
"Capital Stock" means any and all shares, interests, rights to
purchase, warrants, options, participations or other equivalents of or interest
in (however designated) corporate stock, including any Preferred Stock.
"Consolidated Capitalization" means the sum of the Company's
consolidated shareholders' equity, redeemable preferred stock and preferred
securities in any trust, partnership, corporation or other entity of which more
than 50% of the voting equity is owned directly or indirectly by the Company,
including, without limitation, the trust securities issued by Conseco Financing
Trust I, Conseco Financing Trust II, Conseco Financing Trust III, Conseco
Financing Trust IV, Conseco Financing Trust V, Conseco Financing Trust VI,
Conseco Financing Trust VII and Conseco Financing Trust XI.
"Indebtedness" means (i) any liability of any Person (1) for
borrowed money, or under any reimbursement obligation relating to a letter of
credit (other than letters of credit obtained in the ordinary course of
business), or (2) evidenced by a bond, note, debenture or similar instrument
(including a purchase money obligation) given in connection with the acquisition
of any businesses, properties or assets of any kind or with services incurred in
connection with capital expenditures (other than accounts payable or other
indebtedness to trade creditors arising in the ordinary course of business), or
(3) for the payment of money relating to a Capital Lease Obligation; (ii) any
liability of others described in the preceding clause (i) that the Person has
guaranteed or that is otherwise its legal liability; and (iii) any amendment,
supplement, modification, deferral, renewal, extension or refunding of any
liability of types referred to in clauses (i) and (ii) above.
"Lien" means any lien, mortgage, pledge, security interest, charge
or encumbrance of any kind (including any conditional sale or other title
retention agreement and any lease in the nature thereof).
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock or limited liability company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Preferred Stock," as applied to the Capital Stock of any
corporation, means Capital Stock of any class or classes (however designated)
which is preferred as to the payment of dividends, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
5
<PAGE>
"Significant Subsidiary" means any Subsidiary with net earnings
which constituted at least 20% of the Company's consolidated total net earnings,
all as determined as of the date of the Company's most recently prepared
quarterly financial statements for the 12-month period then ended.
"Stated Maturity," when used with respect to any security or any
installment of interest on any security, means the date specified in such
security as the fixed date on which the principal of such security or such
installment of interest, respectively, is finally due and payable, except as
otherwise provided in the case of Capital Lease Obligations.
"Subsidiary" means a corporation of which a majority of the
Capital Stock having voting power under ordinary circumstances to elect a
majority of the board of directors is owned directly or indirectly by the
Company or by one or more Subsidiaries, or by the Company and one or more
Subsidiaries.
If any Event of Default with respect to Notes of this series will
occur and be continuing, the principal of the Notes of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities of
each series to be affected under the Indenture at any time by the Company and
the Trustee with the consent of the Holders of not less than a majority in
aggregate principal amount of the outstanding Securities of each series to be
affected. The Indenture also contains provisions permitting the Holders of
specified percentages in principal amount of the outstanding Securities of each
series, on behalf of the Holders of all Securities of such series, to waive,
with respect to the Securities of such series, compliance by the Company with
certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Note will be conclusive and binding upon such Holder and upon all future
Holders of this Note and of any Note issued upon the registration of transfer
hereof or in exchange therefore or in lieu hereof, whether or not notation of
such consent or waiver is made upon this Note.
Holders of Notes may not enforce their rights pursuant to the
Indenture or the Notes except as provided in the Indenture. No reference herein
to the Indenture and no provision of this Note or of the Indenture will alter or
impair the obligation of the Company, which is absolute and unconditional, to
pay the principal of, and premium, if any, and interest on this Note at the
times, places and rates, herein prescribed.
The Indenture contains provisions for defeasance at any time of
(a) the entire indebtedness of the Company on this Note and (b) certain
restrictive covenants and the related Events of Default upon compliance by the
Company with certain conditions specified therein, which provisions apply to
this Note.
6
<PAGE>
The Notes of this series are issuable only in global or
certificated registered form, without coupons, in denominations of $1,000 and
integral multiples thereof. As provided in the Indenture and subject to certain
limitations therein specified and to the limitations described below, if
applicable, Notes of this series are exchangeable for Notes of this series of
like aggregate principal amount of a different authorized denomination, as
requested by the Holder surrendering the same.
As provided in the Indenture and subject to certain limitations
therein specified and to the limitations described below, if applicable, the
transfer of this Note is registerable in the Security Register upon surrender of
this Note for registration of transfer at the office or agency of the Company
maintained for that purpose duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar (which will initially be the Trustee at its principal corporate trust
office located in the Borough of Manhattan, The City of New York) duly executed
by the Holder hereof or his attorney duly authorized in writing, and thereupon
one or more new Notes of this series with like terms and conditions, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
This Note is exchangeable for certificated Notes only upon the
terms and conditions provided in the Indenture. Except as provided in the
Indenture, owners of beneficial interests in this Note will not be entitled to
receive physical delivery of Notes in certificated registered form and will not
be considered the Holders thereof for any purpose under the Indenture.
This Note is in the form of a Global Security as provided in the
Indenture. If at any time the Depository notifies the Company that it is
unwilling or unable to continue as Depository for this Note or if at any time
the Depository for this series shall no longer be eligible or in good standing
under the Securities Exchange Act of 1934, as amended, or other applicable
statute or regulation, the Company shall appoint a successor Depository with
respect to this Note. If a successor Depository for this Note is not appointed
by the Company within 90 days after the Company receives notice or becomes aware
of such ineligibility, the Company will execute, and the Trustee or its agent,
upon receipt of a Company Request for the authentication and delivery of
certificates representing Securities of this series in exchange for this
Security will authenticate and deliver, certificates representing securities of
this series of like tenor and terms in an aggregate principal amount equal to
the principal amount of this Note in exchange for this Note.
If specified by the Company pursuant to the Indenture with respect
to this Note, the Depository may surrender this Note in exchange in whole or in
part for certificates representing Securities of this series of like tenor and
terms in definitive form on such terms as are acceptable to the Company and the
Depository. Thereupon the Company shall execute, and the trustee or its agent
shall authenticate and deliver, without a service charge, (1) to each Holder
specified by the Security Registrar or the Depository a certificate or
certificates representing Securities of this series of like tenor and terms and
of any authorized denomination as requested by such person in an aggregate
principal amount equal to and in exchange for such Holder's beneficial interest
as specified by the security Registrar or the Depository in this Note; and (2)
to the Depository a new Global Security
7
<PAGE>
of like tenor and terms and in an authorized denomination equal to the
difference, if any, between the principal amount of the surrendered Note and the
aggregate principal amount of certificates representing Notes delivered to
Holders thereof.
No service charge will be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Note is registered as the owner hereof
for all purposes, whether or not this Note be overdue and notwithstanding any
notation of ownership or other writing hereon, and none of the Company, the
Trustee or any such agent will be affected by notice to the contrary.
The Indenture and the Notes will be governed by and construed in
accordance with the laws of the State of New York.
All terms used in this Note which are defined in the Indenture
will have the meanings assigned to them in the Indenture unless otherwise
defined herein; and all references in the Indenture to "Security" or
"Securities" will be deemed to include this Note.
8
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Date: October 21, 1999 CONSECO, INC.
By: /s/ Stephen C. Hilbert
--------------------------------
Stephen C. Hilbert, President
[SEAL]
Attest:
By: /s/ John J. Sabl
--------------------------------
John J. Sabl, Secretary
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Dated: October 21, 1999 THE BANK OF NEW YORK,
as Trustee
By: /s/ Michael Culhane
-------------------------------
Authorized Signatory
9
<PAGE>
-----------------
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and
not as tenants in common
UNIF GIFT MIN ACT - Custodian
__________________________________________
(Cust) (Minor)
Under Uniform Gifts to Minors Act
__________________________________________
(State)
Additional abbreviations may also be used though not in the above list.
------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
______________________________ the within Security and all rights thereunder,
hereby irrevocably constituting and appointing __________________ attorney to
transfer said Security on the books of the Company, with full power of
substitution in the premises.
Date:
______________________
Signature
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE WITHIN INSTRUMENT IN EVERY PARTICULAR, WITHOUT
ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.
THE SIGNATURE(S) MUST BE GUARANTEED BY AN "ELIGIBLE GUARANTOR
INSTITUTION" THAT IS A MEMBER OR PARTICIPANT IN A "SIGNATURE GUARANTEE PROGRAM"
(E.G., THE SECURITIES TRANSFER AGENTS MEDALLION PROGRAM, THE STOCK EXCHANGE
MEDALLION PROGRAM OR THE NEW YORK STOCK EXCHANGE, INC. MEDALLION SIGNATURE
PROGRAM).
10
October 21, 1999
Board of Directors
Conseco, Inc.
11825 N. Pennsylvania Street
Carmel, IN 46032
Re: Conseco, Inc.
8.5% Notes due October 15, 2002
9% Notes due October 15, 2006
Lady and Gentlemen:
I am Executive Vice President, General Counsel and Secretary of
Conseco, Inc., an Indiana corporation (the "Company"), and in such capacity I
have general supervision of the legal affairs of the Company. I, and lawyers
under my supervision (collectively, "we"), have acted as counsel for the Company
in connection with the sale by the Company pursuant to the Underwriting
Agreement dated October 21, 1999 (the "Underwriting Agreement") of a total of
$450,000,000 aggregate principal amount of 8.5% Notes due October 15, 2002 of
the Company (the "8.5% Notes") and $550,000,000 aggregate principal amount of 9%
Notes due October 15, 2006 of the Company (the "9% Notes"; the 8.5% Notes and
the 9% Notes are hereinafter collectively referred to as the "Notes").
In our capacity as such counsel, we have examined (i) the Notes, (ii)
the Registration Statement on Form S-3 (No. 333-56611), as originally filed with
the Commission on June 11, 1998, as amended by Pre-Effective Amendment No. 1 and
Post-Effective Amendment No. 1 thereto and the Registration Statement on Form
S-3 (No. 333-83465), as originally filed with the Commission on July 22, 1999,
as amended by Pre-Effective Amendment No. 1 thereto (together, the "Registration
Statements"), (iii) the Underwriting Agreement, (iv) the Indenture, dated as of
November 13, 1997, between the Company and The Bank of New York (successor to
LTCB Trust Company), as Trustee (the "Indenture"), and (v) the Prospectus
Supplement dated October 18, 1999 and the final Prospectus dated October 1, 1999
relating to the Notes, in the form filed with the Commission pursuant to Rule
424(b) under the 1933 Act Regulations (collectively, the "Prospectus"). We have
also examined originals, or copies certified or otherwise identified to our
satisfaction, of such other
<PAGE>
records and documents as we have deemed necessary as a basis for the opinions
expressed below. In such examination and for the purposes of this opinion, we
have assumed that all natural persons have legal capacity, all items submitted
to us as originals are authentic and all signatures thereon are genuine, all
items submitted to us as copies conform to the originals and each original or
copy is complete and has been duly executed and delivered by each party (other
than the Company) pursuant to due authorization as such party=s legal, valid and
binding obligation, enforceable against such party in accordance with its
respective terms. As to facts material to the opinions expressed herein which
were not independently established or verified, we have relied upon oral or
written statements and representations of the Company. Capitalized terms used
herein and not otherwise defined shall have the respective meanings set forth in
the Underwriting Agreement.
Based upon and subject to the matters stated herein and upon such
investigation as we have deemed necessary and subject to the qualifications,
limitations and assumptions set forth herein, I advise you that in the opinion
of the undersigned:
1. The Company has been incorporated and is validly existing as a
corporation under the laws of the State of Indiana.
2. All legally required proceedings in connection with the
authorization and valid issuance of the Notes and the sale of the Notes in
accordance with the Underwriting Agreement (other than the filing of
post-issuance reports, the non-filing of which would not render the Notes
invalid) have been taken and all legally required orders, consents or other
authorizations or approvals of any other public boards or bodies (including,
without limitation, any insurance regulatory agency or body) in connection with
the authorization and valid issuance of the Notes and the sale of the Notes in
accordance with the Underwriting Agreement (other than in connection with or in
compliance with the provisions of the securities or Blue Sky laws of any
jurisdictions, as to which I express no opinion) have been obtained and are in
full force and effect.
3. The Notes are in the form contemplated by the Indenture, have been
duly authorized, executed and delivered by the Company and, when authenticated
by the Trustee in the manner provided for in the Indenture and delivered against
payment therefor by the Company, will constitute valid and legally binding
obligations of the Company, enforceable against the Company in accordance with
their terms, except to the extent that enforcement thereof may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or other similar laws affecting the enforcement of creditors= rights
generally and by the effect of general principles of equity, regardless of
whether considered in a proceeding in equity or at law.
My opinions expressed herein are limited to the laws of the State of
Indiana and the federal laws of the United States, and I do not express any
opinion herein concerning any other law. I note that the Underwriting Agreement,
the Notes and the Indenture are expressly governed by the laws of the State of
New York and I have assumed, with your permission and without any investigation,
<PAGE>
that the substantive laws of the State of Indiana are substantially identical to
those of the State of New York.
The opinions expressed herein are matters of professional judgment and
not a guarantee of result. The opinions expressed herein are effective as of the
date hereof. I do not undertake to advise you of any matter within the scope of
this letter that comes to my attention after the date of this letter and
disclaim any responsibility to advise you of any future changes in law or in
fact that may affect the opinions set forth herein. The opinions expressed
herein are being delivered to you solely for your benefit and may not be relied
upon by any other person in any manner or for any purpose without my prior
written approval; accordingly, it may not be quoted, filed with any governmental
authority or other regulatory agency or otherwise circulated or utilized for any
other purpose without my written consent.
I consent to the filing of this opinion with the Securities and
Exchange Commission as an exhibit to the Company=s Report on Form 8-K being
filed on or about the date hereof. In giving the foregoing consent, I do not
admit that I come within the category of persons whose consent is required under
the Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission thereunder.
Very truly yours,
/s/ John J. Sabl
-----------------------------------
John J. Sabl,
Executive Vice President
and General Counsel
