<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 10, 1994
REGISTRATION NOS. 33-55047
33-55047-01
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
<TABLE>
<S> <C>
TRANSAMERICA DELAWARE, L.P. TRANSAMERICA CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER) (EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
DELAWARE DELAWARE
(STATE OR OTHER JURISDICTION OF (STATE OR OTHER JURISDICTION OF
INCORPORATION OR ORGANIZATION) INCORPORATION OR ORGANIZATION)
94-3208365 94-0932740
(I.R.S. EMPLOYER IDENTIFICATION NO.) (I.R.S. EMPLOYER IDENTIFICATION NO.)
C/O CHRISTOPHER M. MCLAIN, ESQ. CHRISTOPHER M. MCLAIN, ESQ.
TRANSAMERICA CORPORATION TRANSAMERICA CORPORATION
600 MONTGOMERY STREET 600 MONTGOMERY STREET
SAN FRANCISCO, CALIFORNIA 94111 SAN FRANCISCO, CALIFORNIA 94111
(415) 983-4000 (415) 983-4000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE
NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S
PRINCIPAL EXECUTIVE OFFICES AND AGENT FOR SERVICE) PRINCIPAL EXECUTIVE OFFICES AND AGENT FOR SERVICE)
</TABLE>
------------------------
COPY OF CORRESPONDENCE TO:
<TABLE>
<S> <C>
DANIEL A. NEFF, ESQ. PETER H. DARROW, ESQ.
WACHTELL, LIPTON, ROSEN & KATZ CLEARY, GOTTLIEB, STEEN & HAMILTON
51 WEST 52ND STREET ONE LIBERTY PLAZA
NEW YORK, NEW YORK 10019 NEW YORK, NEW YORK 10006
(212) 403-1000 (212) 225-2000
</TABLE>
------------------------
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of the Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
------------------------
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
EXPLANATORY NOTE
This Registration Statement contains two forms of Prospectus Supplement to
the Prospectus included herein: the first form is to be used in connection with
one or more offerings by Transamerica Delaware, L.P. of fixed rate Cumulative
Monthly Income Preferred Securities, and the second form is to be used in
connection with one or more offerings by Transamerica Delaware, L.P. of
adjustable rate Cumulative Monthly Income Preferred Securities.
<PAGE> 3
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SUPPLEMENT SHALL NOT CONSTITUTE AN OFFER
TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE
OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE
WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE
SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED OCTOBER 10, 1994
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED OCTOBER , 1994
<TABLE>
<S> <C> <C>
[ ] PREFERRED SECURITIES
TRANSAMERICA DELAWARE
% CUMULATIVE MONTHLY INCOME PREFERRED SECURITIES,
[LOGO] SERIES A ("MIPS"*)
</TABLE>
(LIQUIDATION PREFERENCE $25 PER PREFERRED SECURITY)
GUARANTEED TO THE EXTENT SET FORTH HEREIN BY
TRANSAMERICA CORPORATION
---------------------
The % Cumulative Monthly Income Preferred Securities, Series A (the
"Series A Preferred Securities"), representing the limited partner interests
offered hereby, are being issued by Transamerica Delaware, L.P., a limited
partnership formed under the laws of the State of Delaware ("Transamerica
Delaware"). Transamerica Corporation, a Delaware corporation ("Transamerica"),
is the sole general partner in Transamerica Delaware. Transamerica Delaware
exists for the sole purpose of issuing its partnership interests and investing
the proceeds thereof in debt securities of Transamerica. The limited partner
interests represented by the Series A Preferred Securities will have a
preference with respect to cash distributions and amounts payable on liquidation
over the general partner's interest in Transamerica Delaware.
(Continued on next page)
---------------------
SEE "INVESTMENT CONSIDERATIONS" FOR CERTAIN INFORMATION RELEVANT TO AN
INVESTMENT IN THE SERIES A PREFERRED SECURITIES, INCLUDING THE PERIOD AND
CIRCUMSTANCES DURING AND UNDER WHICH PAYMENTS ON THE SERIES A PREFERRED
SECURITIES AND SERIES A JUNIOR SUBORDINATED DEBENTURES MAY BE DEFERRED AND THE
RELATED FEDERAL INCOME TAX CONSEQUENCES.
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR
THE PROSPECTUS TO WHICH IT RELATES. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
---------------------
<TABLE>
<CAPTION>
PROCEEDS TO
INITIAL PUBLIC UNDERWRITING TRANSAMERICA
OFFERING PRICE COMMISSION(1) DELAWARE(2)(3)
--------------- --------------- ---------------
<S> <C> <C> <C>
Per Series A Preferred Security..................... $ (2) $
Total............................................... $ (2) $
</TABLE>
- ---------------
(1) Transamerica Delaware and Transamerica have agreed to indemnify the several
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933, as amended. See "Underwriting".
(2) In view of the fact that the proceeds of the sale of the Series A Preferred
Securities ultimately will be invested in Series A Junior Subordinated
Debentures (as hereinafter defined), the Underwriting Agreement provides
that Transamerica will pay to the Underwriters, as compensation
("Underwriters' Compensation") for their arranging the investment therein of
such proceeds, $ per Series A Preferred Security; provided, that such
compensation will be $ per Series A Preferred Security sold to
certain institutions. Accordingly, the maximum aggregate amount of
Underwriters' Compensation will be $ , but the actual amount of
Underwriters' Compensation will be less than such amount to the extent that
Series A Preferred Securities are sold to such institutions. See
"Underwriting".
(3) Expenses of the offering, which are payable by Transamerica, are estimated
to be $ .
---------------------
The Series A Preferred Securities offered hereby are offered severally by
the Underwriters, as specified herein, subject to receipt and acceptance by them
and subject to their right to reject any order in whole or in part. It is
expected that delivery of the Series A Preferred Securities will be made only in
book-entry form through the facilities of The Depository Trust Company on or
about , 1994.
- ---------------
* An application has been filed by Goldman, Sachs & Co. with the United States
Patent and Trademark Office for the registration of the MIPS servicemark.
GOLDMAN, SACHS & CO.
---------------------
The date of this Prospectus Supplement is , 1994.
<PAGE> 4
(Continued from front cover)
Cash distributions on the Series A Preferred Securities will be cumulative
from the date of original issuance at an annual rate of % of the
liquidation preference of $25 per Series A Preferred Security, and will be
payable monthly in arrears on the last day of each calendar month of each year,
commencing , 1994 ("dividends"), if and to the extent determined to
be payable ("declared") by Transamerica in its capacity as general partner of
Transamerica Delaware (the "General Partner"). The payment of dividends (if and
to the extent declared) and payments on liquidation of Transamerica Delaware and
the redemption of Series A Preferred Securities, as set forth below, are
guaranteed by Transamerica to the extent described herein and in the
accompanying Prospectus (the "Guarantee"). See "Description of the Guarantee" in
the accompanying Prospectus. The proceeds of the offering of the Series A
Preferred Securities will be used by Transamerica Delaware to purchase from
Transamerica its % Junior Subordinated Deferrable Interest Debentures,
Series A, Due 2024 (the "Series A Junior Subordinated Debentures"). Transamerica
has the right from time to time to defer the payment of interest on the Series A
Junior Subordinated Debentures for one or more Extension Periods (as hereinafter
defined) at the end of each of which all accrued and unpaid interest is required
to be paid in full. If Transamerica does not make interest payments on the
Series A Junior Subordinated Debentures, it is expected that Transamerica
Delaware will not declare or pay dividends on the Series A Preferred Securities.
The Guarantee is a full and unconditional guarantee from the time of issuance of
the Series A Preferred Securities, but does not apply to any payment of
dividends unless and until such dividends are declared.
The Series A Preferred Securities are redeemable at the option of
Transamerica Delaware, in whole or in part, from time to time, on or after
, 1999, at $25 per Series A Preferred Security plus accrued and unpaid
dividends thereon to the date fixed for redemption, payable in cash (the
"Redemption Price"). See "Description of the Series A Preferred
Securities -- Optional Redemption". The Series A Preferred Securities have no
maturity date, although they are mandatorily redeemable upon the maturity or
earlier redemption or repurchase of the Series A Junior Subordinated Debentures.
See "Description of the Series A Preferred Securities -- Mandatory Redemption."
In addition, upon the occurrence of certain special events arising from a
change in law or a change in legal interpretation or other specified
circumstances, the Series A Preferred Securities are redeemable in whole at the
Redemption Price at the option of Transamerica, in its capacity as the General
Partner, or the General Partner may dissolve Transamerica Delaware and cause to
be distributed to the holders of the Series A Preferred Securities, on a pro
rata basis, the Series A Junior Subordinated Debentures in lieu of any cash
distribution. If the Series A Junior Subordinated Debentures are distributed to
the holders of the Series A Preferred Securities, Transamerica will use its best
efforts to have the Series A Junior Subordinated Debentures listed on the New
York Stock Exchange or on such other exchange as the Series A Preferred
Securities are then listed. The obligations of Transamerica under the Series A
Junior Subordinated Debentures are subordinate and junior in right of payment to
Senior Indebtedness (as defined in the accompanying Prospectus) of Transamerica.
At , 1994, Senior Indebtedness of Transamerica (on an unconsolidated
basis) aggregated approximately $ million. Because Transamerica is a
holding company, the Series A Junior Subordinated Debentures are also
effectively subordinated to all existing and future liabilities, including trade
payables, of Transamerica's subsidiaries, except to the extent that Transamerica
is a creditor of the subsidiaries recognized as such. See "Description of the
Series A Preferred Securities -- Special Event Redemption or Distribution" and
"Description of the Series A Junior Subordinated Debentures".
In the event of the dissolution of Transamerica Delaware, the holders of
the Series A Preferred Securities will be entitled to receive for each Series A
Preferred Security a liquidation preference of $25 plus accrued and unpaid
dividends thereon to the date of payment, subject to certain limitations,
unless, in connection with such dissolution, Series A Junior Subordinated
Debentures are distributed to the holders of the Series A Preferred Securities.
See "Description of the Series A Preferred Securities -- Liquidation
Distribution Upon Dissolution".
Application has been made to list the Series A Preferred Securities on the
New York Stock Exchange. See "Underwriting."
Prospective purchasers are urged to read the accompanying Prospectus for
certain additional material information regarding the Series A Preferred
Securities, the Series A Junior Subordinated Debentures and the Guarantee.
S-2
<PAGE> 5
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES
OFFERED HEREBY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE, IN THE
OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
------------------------
FOR NORTH CAROLINA PURCHASERS: THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE COMMISSIONER OF INSURANCE FOR THE STATE OF NORTH CAROLINA,
NOR HAS THE COMMISSIONER OF INSURANCE RULED UPON THE ACCURACY OR ADEQUACY OF
THIS DOCUMENT.
------------------------
S-3
<PAGE> 6
TRANSAMERICA DELAWARE
Transamerica Delaware is a limited partnership that was formed under the
Delaware Revised Uniform Limited Partnership Act (the "Partnership Act") on
August 9, 1994. The initial partners in Transamerica Delaware are Transamerica,
as general partner, and Transamerica LP Holdings Corp., a Delaware corporation
and a wholly-owned subsidiary of Transamerica ("Transamerica Holdings"), as
limited partner. Upon the issuance of the Series A Preferred Securities, which
securities represent limited partner interests in Transamerica Delaware,
Transamerica Holdings will remain as a limited partner, but will have no
interest in the profits and dividends or in the assets of Transamerica Delaware.
The General Partner will agree to contribute capital to the extent required to
maintain its capital at an amount equal to at least 3% of the total capital
contributions to Transamerica Delaware. Transamerica and Transamerica Holdings
entered into an agreement of limited partnership dated as of August 9, 1994.
Such agreement of limited partnership will be amended and restated in its
entirety (as so amended and restated, the "Limited Partnership Agreement"),
substantially in the form filed as an exhibit to the Registration Statement of
which this Prospectus Supplement and the accompanying Prospectus form a part.
Transamerica Delaware is managed by the General Partner and exists for the
sole purpose of issuing its partnership interests and investing the proceeds
thereof in junior subordinated debentures of Transamerica ("Junior Subordinated
Debentures"). The rights of the holders of the Series A Preferred Securities,
including economic rights, rights to information and voting rights, are set
forth in the Limited Partnership Agreement (including the action of the General
Partner specifying the terms of the Series A Preferred Securities (the "Action")
taken in accordance with the Limited Partnership Agreement) and the Partnership
Act. See "Description of the Series A Preferred Securities".
The business address of Transamerica Delaware is c/o Transamerica
Corporation, 600 Montgomery Street, San Francisco, California 94111, telephone
number (415) 983-4000.
TRANSAMERICA CORPORATION
Transamerica Corporation is a diversified financial services company, whose
core businesses include consumer lending, commercial lending, leasing, real
estate services, life insurance and asset management. Transamerica was
incorporated in Delaware in 1928. At June 30, 1994, Transamerica had
consolidated assets of $39.0 billion and total shareholders' equity of $3.1
billion. For the year ended December 31, 1993, Transamerica had revenues of $4.8
billion and net income of $377 million.
Because Transamerica is a holding company, the Series A Junior Subordinated
Debentures are effectively subordinated to all existing and future liabilities,
including trade payables, of Transamerica's subsidiaries, except to the extent
that Transamerica is a creditor of the subsidiaries recognized as such.
The principal executive offices of Transamerica are located at 600
Montgomery Street, San Francisco, California 94111. Transamerica's telephone
number is (415) 983-4000.
S-4
<PAGE> 7
INVESTMENT CONSIDERATIONS
Prospective purchasers of Series A Preferred Securities should review
carefully the information contained elsewhere in this Prospectus Supplement and
in the accompanying Prospectus and should consider particularly the following
matters:
SUBORDINATION OF GUARANTEE AND SERIES A JUNIOR SUBORDINATED DEBENTURES;
DEPENDENCE ON TRANSAMERICA. Transamerica's obligations under the Guarantee are
subordinate and junior in right of payment to all other liabilities of
Transamerica except those made pari passu (that is, equal in priority) by their
terms. The obligations of Transamerica under the Series A Junior Subordinated
Debentures described under "Description of the Series A Junior Subordinated
Debentures" are subordinate and junior in right of payment to Senior
Indebtedness of Transamerica. At August 31, 1994, Senior Indebtedness of
Transamerica (on an unconsolidated basis) aggregated approximately $730 million.
Because Transamerica is a holding company, the Series A Junior Subordinated
Debentures are also effectively subordinated to all existing and future
liabilities, including trade payables, of Transamerica's subsidiaries, except to
the extent that Transamerica is a creditor of the subsidiaries recognized as
such. At June 30, 1994, Transamerica's subsidiaries had outstanding $8.0 billion
of indebtedness, $23.4 billion of life insurance policy liabilities and
approximately $3.7 billion of other liabilities. There are no terms in the
Series A Preferred Securities, the Series A Junior Subordinated Debentures or
the Guarantee that limit Transamerica's ability to incur additional
indebtedness, including indebtedness that ranks senior to the Series A Junior
Subordinated Debentures and the Guarantee or the ability of its subsidiaries to
incur additional indebtedness. See "Description of the Guarantee -- Status of
the Guarantee" and "Description of the Junior Subordinated
Debentures -- Subordination" in the accompanying Prospectus.
Transamerica Delaware's ability to pay dividends on the Series A Preferred
Securities is solely dependent upon Transamerica making interest payments on the
Series A Junior Subordinated Debentures as and when required. In the event that
Transamerica were for any reason to be unable to make payments on the Series A
Junior Subordinated Debentures as and when required, there is a substantial
likelihood that Transamerica, in its capacity as Guarantor, would be unable to
make payments on the Guarantee as and when required. Transamerica's obligations
under the Guarantee are unsecured and, on a liquidation or winding up of
Transamerica, its obligations under the Guarantee will rank junior to all of its
other liabilities except those made pari passu by their terms.
OPTION TO EXTEND INTEREST PAYMENT PERIOD; TAX IMPACT OF EXTENSION.
Transamerica has the right under the Indenture (as defined herein) to extend
the interest payment period from time to time on the Series A Junior
Subordinated Debentures to a period not exceeding 60 consecutive months (an
"Extension Period"), and, as a consequence, monthly dividends on the Series A
Preferred Securities would be deferred (but would continue to accrue with
interest thereon) by Transamerica Delaware during any such Extension Period. In
the event that Transamerica exercises this right, Transamerica may not during
such Extension Period declare or pay dividends on, or purchase or acquire, any
of its common stock. Prior to the termination of any such Extension Period,
Transamerica may further extend such Extension Period, provided that such
Extension Period together with all such previous and further extensions thereof
may not exceed 60 consecutive months. Upon the termination of any Extension
Period and the payment of all amounts then due, Transamerica may select a new
Extension Period, subject to the above requirements. The entire principal
amount of the Series A Junior Subordinated Debentures will become due and
payable, together with any accrued and unpaid interest thereon, including
Additional Interest (as hereinafter defined), if any, on , 2024.
See "Description of the Series A Preferred Securities -- Dividends" and
"Description of the Series A Junior Subordinated Debentures -- Option to Extend
Interest Payment Period".
Should an Extension Period occur, Transamerica Delaware will continue to
accrue income for United States federal income tax purposes which will be
allocated, but not distributed by way of cash dividends, to holders of record of
Series A Preferred Securities. As a result, such a holder will
S-5
<PAGE> 8
include such interest in such holder's gross income for United States federal
income tax purposes in advance of the receipt of cash, and will not receive the
cash from Transamerica Delaware related to such income if such a holder disposes
of his or her Series A Preferred Securities prior to the record date for payment
of dividends. See "United States Taxation -- Potential Extension of Interest
Payment Period".
SPECIAL EVENT REDEMPTION OR DISTRIBUTION. Upon the occurrence of a Special
Event (as hereinafter defined), which may occur at any time, the General Partner
shall elect to either (i) redeem the Series A Preferred Securities in whole or
(ii) dissolve Transamerica Delaware and cause the Series A Junior Subordinated
Debentures to be distributed to the holders of the Series A Preferred Securities
in connection with the liquidation of Transamerica Delaware. In the case of a
Special Event which is a Tax Event (as hereinafter defined), however, the
General Partner may, as an alternative to electing to redeem the Series A
Preferred Securities or dissolving Transamerica Delaware, elect to cause the
Series A Preferred Securities to remain outstanding. There can be no assurance
as to the market prices for the Series A Preferred Securities or the Series A
Junior Subordinated Debentures which may be distributed in exchange for Series A
Preferred Securities were a dissolution and liquidation of Transamerica Delaware
to occur. Accordingly, the Series A Preferred Securities which an investor may
purchase, or the Series A Junior Subordinated Debentures which the investor may
receive, may trade at a discount to the price which the investor paid to
purchase the Series A Preferred Securities offered hereby. See "Description of
the Series A Preferred Securities -- Special Event Redemption or Distribution"
and "Description of the Series A Junior Subordinated Debentures -- General".
Under current United States federal income tax law and interpretation, a
distribution of the Series A Junior Subordinated Debentures upon a Special Event
would not be a taxable event to holders of the Series A Preferred Securities.
Under a change in law, a change in legal interpretation or the other
circumstances giving rise to a Special Event, however, the dissolution could be
a taxable event to holders of the Series A Preferred Securities. See "United
States Taxation -- Receipt of Series A Junior Subordinated Debentures Upon
Liquidation of Transamerica Delaware".
S-6
<PAGE> 9
SUMMARY CONSOLIDATED FINANCIAL DATA
This summary is qualified in its entirety by the detailed information and
financial statements included in the documents incorporated by reference herein,
including that for interim periods. The information furnished for the six months
ended June 30, 1994 and 1993 reflects all adjustments and accruals which are, in
the opinion of the management of Transamerica, necessary for a fair statement of
the results for such periods. The results of operations in the interim
statements are not necessarily indicative of the results that may be expected
for the full year. See "Incorporation of Certain Documents by Reference" in the
accompanying Prospectus.
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
YEARS ENDED DECEMBER 31, JUNE 30,
--------------------------------------------------------- ---------------------
1989 1990 1991 1992 1993 1993 1994
--------- --------- --------- --------- --------- --------- ---------
(IN MILLIONS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues.............................. $ 4,476.1 $ 4,097.7 $ 4,175.2 $ 4,550.9 $ 4,813.3 $ 2,362.5 $ 2,598.4
Net income:
Income from continuing operations... 251.3 190.5 5.7 334.0 447.5 210.3 209.4
Income (loss) from discontinued
operations........................ 80.9 75.8 79.1 (90.8) (47.0) 5.4 (0.7)
Extraordinary loss on early
extinguishment of debt............ (23.1)
Cumulative effect of change in
accounting for post employment
benefits other than pensions...... (34.7)
--------- --------- --------- --------- --------- --------- ---------
Net income............................ $ 332.2 $ 266.3 $ 50.1 $ 243.2 $ 377.4 $ 215.7 $ 208.7
========= ========= ========= ========= ========= ========= =========
Earnings per common share
Net Income:
Income from continuing
operations...................... $ 3.11 $ 2.30 $ (0.08) $ 4.00 $ 5.40 $ 2.50 $ 2.63
Income (loss) from discontinued
operations...................... 1.07 0.99 1.03 (1.17) (0.60) 0.07 (0.01)
Extraordinary loss on early
extinguishment of debt.......... (0.29)
Cumulative effect of change in
accounting for post employment
benefits other than pensions.... (0.45)
--------- --------- --------- --------- --------- --------- ---------
Net income........................ $ 4.18 $ 3.29 $ 0.50 $ 2.83 $ 4.51 $ 2.57 $ 2.62
========= ========= ========= ========= ========= ========= =========
Average number of common shares
outstanding......................... 75.5 76.2 76.7 78.1 78.5 79.3 75.0
Balance sheet data (at period end):
Total assets.......................... $27,357.1 $29,260.9 $31,133.6 $33,290.9 $36,050.5 $35,101.6 $38,956.5
Notes and loans payable:
Short-term and current portion of
long-term debt.................... 1,038.2 869.1 715.4 1,062.6 2,023.0 1,277.6 1,647.0
Long-term debt...................... 6,897.2 6,602.5 6,975.6 6,510.5 5,681.0 6,293.1 7,111.3
Shareholders' equity(1)............... 2,928.7 3,016.7 3,025.8 3,300.1 3,363.5 3,415.9 3,106.1
Book value per common share........... $ 35.63 $ 36.56 $ 36.28 $ 36.31 $ 38.46 $ 38.02 $ 38.09
</TABLE>
- ---------------
(1) In the first quarter of 1994 Transamerica adopted Statement of Financial
Accounting Standards No. 115, Accounting for Certain Investments in Debt
and Equity Securities, which resulted in all of Transamerica's investments
in debt securities being reported at fair value. As of June 30, 1994 the
net unrealized gain from investments marked to fair value included in
shareholders' equity has been reduced by $14.9 million as a result of
adopting this new accounting standard. There is no effect on the income
statement from the adoption of this new accounting standard, and prior
periods have not been restated.
S-7
<PAGE> 10
CAPITALIZATION OF TRANSAMERICA
The following table sets forth the consolidated short-term obligations and
capitalization of Transamerica as of June 30, 1994, and as adjusted to reflect
the application of the estimated net proceeds from the sale of the Series A
Preferred Securities. See "Use of Proceeds".
<TABLE>
<CAPTION>
JUNE 30, 1994
-------------------------
ACTUAL AS ADJUSTED
--------- -----------
(IN MILLIONS)
<S> <C> <C>
Short-term obligations, including current maturities............... $ 1,647.0 $
Long-term debt (1)................................................. 7,111.3
Life insurance policy liabilities.................................. 23,410.3
Other liabilities.................................................. 3,681.9
Minority interest in equity of subsidiaries........................
Shareholders' equity:
Preferred stock, par value $100 per share; 1,200,000 shares
authorized;
8.50% Preferred Stock, Series D ($500 liquidation preference)
400,000 shares issued....................................... 200.0
Dutch Auction Rate Transferable Securities
Preferred Stock ("DARTS"), Series A-1
750 shares issued........................................... 75.0
DARTS, Series B-1
750 shares issued........................................... 75.0
DARTS, Series C-1
750 shares issued........................................... 75.0
Common stock, par value $1.00 per share; 150,000,000 shares
authorized; 70,393,675 shares outstanding, after deducting
9,344,787 shares in treasury.................................. 70.4
Additional paid-in capital....................................... 152.1
Retained earnings................................................ 2,421.8
Net unrealized gain from investments marked to fair value........ 72.7
Foreign currency translation adjustments......................... (35.9)
--------- ----------
Total shareholders' equity............................... 3,106.1
--------- ----------
Total capitalization (excluding life insurance policy
liabilities, other liabilities and short-term
obligations)........................................... $10,217.4 $
========= ==========
</TABLE>
- ---------------
(1) Senior Indebtedness of Transamerica, for purposes of the subordination
provisions of the Series A Junior Subordinated Debentures, includes only
indebtedness of Transamerica on an unconsolidated basis. As of August 31,
1994, such Senior Indebtedness aggregated approximately $730 million.
Because Transamerica is a holding company, the Series A Junior Subordinated
Debentures are also effectively subordinated to all other long-term debt
and short-term obligations set forth in the above table, as well as other
liabilities of Transamerica's subsidiaries.
USE OF PROCEEDS
The proceeds from the sale of the Series A Preferred Securities will be
invested in the Series A Junior Subordinated Debentures issued pursuant to the
Indenture described herein, and ultimately will be used by Transamerica for
general corporate purposes, which may include the repayment or repurchase of its
securities.
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DESCRIPTION OF THE SERIES A PREFERRED SECURITIES
GENERAL
All of the partnership interests in Transamerica Delaware are owned
directly or indirectly by Transamerica. The Limited Partnership Agreement
(including the Action) authorizes and creates the Series A Preferred Securities,
which represent limited partner interests in Transamerica Delaware ("Preferred
Securities"). Other Preferred Securities may be issued from time to time in one
or more series as described in the accompanying Prospectus. The limited partner
interests represented by the Series A Preferred Securities will have a
preference with respect to dividends and amounts payable on redemption or
liquidation over the General Partner's interest in Transamerica Delaware. The
Limited Partnership Agreement does not permit the issuance of any Preferred
Securities ranking, as to participation in profits and dividends and in the
assets of Transamerica Delaware, senior or junior to the Series A Preferred
Securities or the incurrence of any indebtedness by Transamerica Delaware. The
summary of certain material terms and provisions of the Series A Preferred
Securities set forth below does not purport to be complete and is subject to,
and qualified in its entirety by reference to, the Limited Partnership Agreement
(including the Action) which has been filed as an exhibit to the Registration
Statement of which this Prospectus Supplement forms a part, and the Partnership
Act.
DIVIDENDS
The dividends payable on each Series A Preferred Security will be fixed at
a rate per annum of % of the stated liquidation preference of $25 per
Preferred Security. Dividends in arrears for more than one month will bear
interest thereon at the rate per annum of % thereof. The term "dividends" as
used herein includes any such interest payable unless otherwise stated. The
amount of dividends payable for any period will be computed on the basis of a
360-day year of twelve 30-day months.
Dividends on the Series A Preferred Securities will be cumulative, will
accrue from the date of initial issuance and will be payable monthly in arrears,
on the last day of each calendar month of each year, commencing ,
1994, when, as and if determined to be so payable by Transamerica, in its
capacity as General Partner, except as otherwise described below. Transamerica
has the right under the Indenture (as hereinafter defined) to extend the
interest payment period from time to time on the Series A Junior Subordinated
Debentures to a period not exceeding 60 consecutive months and, as a
consequence, monthly dividends on the Series A Preferred Securities would be
deferred (but would continue to accrue with interest thereon) by Transamerica
Delaware during any such Extension Period. In the event that Transamerica
exercises this right, Transamerica may not declare or pay dividends on, or
purchase or acquire, any of its common stock during such Extension Period. Prior
to the termination of any such Extension Period, Transamerica may further extend
such Extension Period, provided that such Extension Period together with all
such previous and further extensions thereof may not exceed 60 consecutive
months. Upon the termination of any Extension Period and the payment of all
amounts then due, Transamerica may select a new Extension Period, subject to the
above requirements. See "Description of the Series A Junior Subordinated
Debentures -- Interest" and "-- Option to Extend Interest Payment Period".
It is anticipated that Transamerica Delaware's earnings available for
distribution to the holders of the Series A Preferred Securities will be limited
to payments under the Series A Junior Subordinated Debentures in which
Transamerica Delaware will invest the proceeds from the issuance and sale of the
Series A Preferred Securities and the General Partnership Payment (as
hereinafter defined). See "Description of the Series A Junior Subordinated
Debentures". If Transamerica does not make interest payments on the Series A
Junior Subordinated Debentures, it is expected that Transamerica Delaware will
not declare or pay dividends on the Series A Preferred Securities. The payment
of dividends (if and to the extent declared) is guaranteed by Transamerica as
and to the extent set forth under "Description of the Guarantee" in the
accompanying
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Prospectus. The Guarantee is a full and unconditional guarantee from the time of
issuance of the Series A Preferred Securities, but does not apply to any payment
of dividends unless and until such dividends are declared.
Dividends on the Series A Preferred Securities will be payable to the
holders thereof as they appear on the books and records of Transamerica Delaware
on the relevant record dates, which, as long as the Series A Preferred
Securities remain in book-entry-only form, will be one Business Day (as
hereinafter defined) prior to the relevant payment dates. Subject to any
applicable laws and regulations and the provisions of the Limited Partnership
Agreement, each such payment will be made as described under "Book-Entry-Only
Issuance -- The Depository Trust Company" below. In the event the Series A
Preferred Securities shall not continue to remain in book-entry-only form, the
General Partner shall have the right to select relevant record dates, which
shall be more than one Business Day prior to the relevant payment dates. In the
event that any date on which dividends are payable on the Series A Preferred
Securities is not a Business Day, then payment of the dividend payable on such
date will be made on the next succeeding day that is a Business Day (and without
any interest or other payment in respect of any such delay) except that, if such
Business Day is in the next succeeding calendar year, such payment shall be made
on the immediately preceding Business Day, in each case with the same force and
effect as if made on such date. A "Business Day" shall mean any day other than a
day on which banking institutions in The City of New York are authorized or
required by law to close.
CERTAIN RESTRICTIONS ON TRANSAMERICA DELAWARE
If dividends have not been paid in full on the Series A Preferred
Securities, Transamerica Delaware shall not:
(i) declare, pay, or set aside for payment, any dividends on any other
series of Preferred Securities, unless the amounts of any dividends
declared and paid on any other series of Preferred Securities and on the
Series A Preferred Securities are on a pro rata basis on the dates such
dividends are paid on such other series of Preferred Securities, so that
(x) the aggregate amount of dividends paid on the Series A
Preferred Securities bears to the aggregate amount of dividends paid on
such other series of Preferred Securities the same ratio as
(y) the aggregate of all accrued and unpaid dividends in respect of
the Series A Preferred Securities bears to the aggregate of all accrued
and unpaid dividends in respect of such other series of Preferred
Securities; or
(ii) redeem, purchase or otherwise acquire any other Preferred
Securities;
until, in each case, such time as all accrued and unpaid dividends on the Series
A Preferred Securities shall have been paid in full for all dividend periods
terminating on or prior to, in the case of clause (i), such payment and, in the
case of clause (ii), the date of such redemption, purchase or acquisition.
As of the date of this Prospectus Supplement, there are no series of
Preferred Securities outstanding.
OPTIONAL REDEMPTION
The Series A Preferred Securities are redeemable, at the option of
Transamerica Delaware, in whole or in part, from time to time, on or after
, 1999, upon not less than 30 nor more than 60 days' notice, at the
Redemption Price. If Transamerica Delaware redeems Series A Preferred Securities
in accordance with the terms thereof, the Series A Junior Subordinated
Debentures will become due and payable in a principal amount equal to the
aggregate stated liquidation preference of the Series A Preferred Securities so
redeemed, together with any accrued and unpaid interest on such principal amount
of Series A Junior Subordinated Debentures. See "Description of Series A
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Junior Subordinated Debentures -- Mandatory Prepayment". In the event that fewer
than all the outstanding Series A Preferred Securities are to be so redeemed,
the Series A Preferred Securities to be redeemed will be selected as described
under "Book-Entry-Only Issuance -- The Depository Trust Company" below. If a
partial redemption would result in the delisting of the Series A Preferred
Securities, Transamerica Delaware may only redeem the Series A Preferred
Securities in whole.
SPECIAL EVENT REDEMPTION OR DISTRIBUTION
If a Tax Event or an Investment Company Event (each as hereinafter defined,
and each a "Special Event") shall occur and be continuing, the General Partner
shall elect to either (i) redeem the Series A Preferred Securities in whole (and
not in part), upon not less than 30 or more than 60 days' notice at the
Redemption Price, within 90 days following the occurrence of such Special Event;
provided that, if and as long as at the time there is available to the General
Partner the opportunity to eliminate, within such 90-day period, the Special
Event by taking some ministerial action, such as filing a form or making an
election, or pursuing some other similar reasonable such measure that has no
adverse effect on Transamerica Delaware or Transamerica, the General Partner
will pursue such measure in lieu of redemption, or (ii) dissolve Transamerica
Delaware and, after satisfaction of creditors as required by the Partnership
Act, cause Series A Junior Subordinated Debentures to be distributed to the
holders of the Series A Preferred Securities in liquidation of Transamerica
Delaware, within 90 days following the occurrence of such Special Event. In the
case of a Tax Event, the General Partner may, as an alternative to electing to
redeem the Series A Preferred Securities or dissolving Transamerica Delaware,
elect to cause the Series A Preferred Securities to remain outstanding.
"Tax Event" means that Transamerica shall have obtained an opinion of
nationally recognized independent tax counsel experienced in such matters to the
effect that on or after the date of this Prospectus Supplement, as a result of
(a) any amendment to, or change (including any announced prospective change) in,
the laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, (b) any amendment to, or
change in, an interpretation or application of any such laws or regulations by
any legislative body, court, governmental agency or regulatory authority
(including the enactment of any legislation and the publication of any judicial
decision or regulatory determination), (c) any interpretation or pronouncement
that provides for a position with respect to such laws or regulations that
differs from the theretofore generally accepted position or (d) any action taken
by any governmental agency or regulatory authority, which amendment or change is
enacted, promulgated, issued or effective or which interpretation or
pronouncement is issued or announced or which action is taken, in each case on
or after the date of this Prospectus Supplement, there is more than an
insubstantial risk that (i) Transamerica Delaware is subject to federal income
tax with respect to interest accrued or received on the Series A Junior
Subordinated Debentures, (ii) Transamerica Delaware is subject to more than a de
minimis amount of taxes, duties or other governmental charges, or (iii) interest
payable by Transamerica to Transamerica Delaware on the Series A Junior
Subordinated Debentures will not be deductible by Transamerica for federal
income tax purposes.
"Investment Company Event" means the occurrence of a change in law or
regulation or a change in interpretation or application of law or regulation by
any legislative body, court, governmental agency or regulatory authority (a
"Change in 1940 Act Law") to the effect that Transamerica Delaware is or will be
considered an "investment company" which is required to be registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), which Change in
1940 Act Law becomes effective on or after the date of this Prospectus
Supplement; provided that no Investment Company Event shall be deemed to have
occurred if the General Partner obtains a written opinion of nationally
recognized independent counsel to the Partnership experienced in practice under
the 1940 Act to the effect that the General Partner has successfully issued an
additional or supplemental irrevocable and unconditional guarantee or taken such
other actions as may be necessary so that, in the opinion of such counsel,
notwithstanding such Change in 1940 Act Law, Transamerica Delaware
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is not required to be registered as an "investment company" within the meaning
of the 1940 Act. In case of any uncertainty regarding an Investment Company
Event, the good faith determination of the General Partner (based on the advice
of counsel) shall be conclusive.
After the date fixed for any distribution of Series A Junior Subordinated
Debentures, upon dissolution of Transamerica Delaware, (i) the Series A
Preferred Securities will no longer be deemed to be outstanding, (ii) The
Depository Trust Company (the "Depository" or "DTC") or its nominee, as the
record holder of the Series A Preferred Securities, will receive a registered
global certificate or certificates representing the Series A Junior Subordinated
Debentures to be delivered upon such distribution and (iii) any certificates
representing Series A Preferred Securities not held by DTC or its nominee will
be deemed to represent Series A Junior Subordinated Debentures having a
principal amount equal to the stated liquidation preference of such Series A
Preferred Securities, and bearing accrued and unpaid interest in an amount equal
to the accrued and unpaid dividends on such Series A Preferred Securities until
such certificates are presented to Transamerica or its agent for transfer or
reissuance.
There can be no assurance as to the market prices for the Series A
Preferred Securities or the Series A Junior Subordinated Debentures which may be
distributed in exchange for Series A Preferred Securities were a dissolution and
liquidation of Transamerica Delaware to occur. Accordingly, the Series A
Preferred Securities which an investor may purchase, or the Series A Junior
Subordinated Debentures which the investor may receive, may trade at a discount
to the price which the investor paid to purchase the Series A Preferred
Securities offered hereby.
MANDATORY REDEMPTION
Upon the repayment of the Series A Junior Subordinated Debentures, whether
at maturity or upon redemption, repurchase or otherwise, the proceeds from such
repayment will be applied to redeem the Series A Preferred Securities, in whole,
upon not less than 30 nor more than 60 days' notice, at the Redemption Price.
REDEMPTION PROCEDURES
Transamerica Delaware may not redeem fewer than all the outstanding Series
A Preferred Securities unless all accrued and unpaid dividends have been paid on
all Series A Preferred Securities for all monthly dividend periods terminating
on or prior to the date of redemption.
If Transamerica Delaware gives a notice of redemption in respect of Series
A Preferred Securities (which notice will be irrevocable) then, by 12:00 noon,
New York City time, on the redemption date, Transamerica Delaware will deposit
irrevocably with DTC funds sufficient to pay the applicable Redemption Price and
will give DTC irrevocable instructions and authority to pay the Redemption Price
to the holders of the Series A Preferred Securities. See "Book-Entry-Only
Issuance -- The Depository Trust Company". If notice of redemption shall have
been given and funds deposited as required, then upon the date of such deposit,
all rights of holders of such Series A Preferred Securities so called for
redemption will cease, except the right of the holders of such Series A
Preferred Securities to receive the Redemption Price, but without interest on
such Redemption Price. In the event that any date fixed for redemption of Series
A Preferred Securities is not a Business Day, then payment of the Redemption
Price payable on such date will be made on the next succeeding day that is a
Business Day (and without any interest or other payment in respect of any such
delay) except that, if such Business Day falls in the next calendar year, such
payment will be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date fixed for redemption. In
the event that payment of the Redemption Price in respect of Series A Preferred
Securities is improperly withheld or refused and not paid either by Transamerica
Delaware or by Transamerica pursuant to the Guarantee described under
"Description of the Guarantee" in the accompanying Prospectus, dividends on such
Series A Preferred Securities will continue to accrue, from the original
redemption date to the date of
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payment, in which case the actual payment date will be considered the date fixed
for redemption for purposes of calculating the Redemption Price.
Subject to the foregoing and applicable law (including, without limitation,
United States federal securities laws), Transamerica or any of its subsidiaries,
including Transamerica Delaware, may at any time and from time to time purchase
outstanding Series A Preferred Securities by tender, in the open market or by
private agreement. If Transamerica Delaware purchases and cancels any Series A
Preferred Securities, the Series A Junior Subordinated Debentures may be repaid
in a principal amount equal to the aggregate stated liquidation preference of
the Series A Preferred Securities so purchased, together with any accrued and
unpaid interest on such principal amount of Series A Junior Subordinated
Debentures. See "Description of Series A Junior Subordinated
Debentures -- Optional Prepayment".
LIQUIDATION DISTRIBUTION UPON DISSOLUTION
In the event of any voluntary or involuntary dissolution, winding-up or
termination of Transamerica Delaware, the holders of the Series A Preferred
Securities at the time will be entitled to receive out of the assets of
Transamerica Delaware available for distribution to partners after satisfaction
of liabilities of creditors as required by the Partnership Act, before any
distribution of assets is made to the General Partner, but together with the
holders of every other series of Preferred Securities outstanding, an amount
equal to, in the case of holders of Series A Preferred Securities, the aggregate
of the stated liquidation preference of $25 per Series A Preferred Security plus
accrued and unpaid dividends thereon to the date of payment (such amount being
the "Liquidation Distribution"), unless, in connection with such dissolution,
winding-up or termination, Series A Junior Subordinated Debentures in an
aggregate principal amount equal to the stated liquidation preference of such
Series A Preferred Securities, and bearing accrued and unpaid interest in an
amount equal to the accrued and unpaid dividends on such Series A Preferred
Securities, shall be distributed on a pro rata basis to the holders of the
Series A Preferred Securities.
If, upon any such dissolution, the Liquidation Distribution can be paid
only in part because Transamerica Delaware has insufficient assets available to
pay in full the aggregate Liquidation Distribution and the aggregate maximum
liquidation distributions on any other series of Preferred Securities, then the
amounts payable directly by Transamerica Delaware on the Series A Preferred
Securities and on such other series of Preferred Securities shall be paid in
cash or in kind on a pro rata basis, so that
(x) the aggregate amount paid in respect of the Liquidation
Distribution bears to the aggregate amount paid as liquidation
distributions on the other series of Preferred Securities the same ratio as
(y) the aggregate Liquidation Distribution bears to the aggregate
maximum liquidation distributions on the other series of Preferred
Securities.
Pursuant to the Limited Partnership Agreement, Transamerica Delaware shall
be dissolved and its affairs shall be wound up: (i) on December 31, 2093, the
expiration of the term of Transamerica Delaware, (ii) upon the bankruptcy of the
General Partner, (iii) upon the assignment by the General Partner of its entire
interest in Transamerica Delaware when the assignee is not admitted to
Transamerica Delaware as a general partner of Transamerica Delaware in
accordance with the Limited Partnership Agreement, or the filing of a
certificate of dissolution or its equivalent with respect to the General
Partner, or the revocation of the General Partner's charter and the expiration
of 90 days after the date of notice to the General Partner of revocation without
a reinstatement of its charter, or if any other event occurs that causes the
General Partner to cease to be a general partner of Transamerica Delaware under
the Partnership Act, unless the business of Transamerica Delaware is continued
in accordance with the Partnership Act, (iv) in accordance with the provisions
of the Series A Preferred Securities, (v) upon the entry of a decree of judicial
dissolution or (vi) upon the written consent of all partners of Transamerica
Delaware.
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MERGER, CONSOLIDATION OR AMALGAMATION OF TRANSAMERICA DELAWARE
Transamerica Delaware may not consolidate, amalgamate, merge with or into,
or be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to, any corporation or other body, except as
described below. Transamerica Delaware may, without the consent of the holders
of the Series A Preferred Securities, consolidate, amalgamate, merge with or
into, or be replaced by a limited partnership, limited liability company or
trust organized as such under the laws of any state of the United States of
America provided that (i) such successor entity either (x) expressly assumes all
of the obligations of Transamerica Delaware under the Series A Preferred
Securities or (y) substitutes for the Series A Preferred Securities other
securities having substantially the same terms as the Series A Preferred
Securities (the "Successor Securities") so long as the Successor Securities
rank, with respect to participation in the profits and dividends, and in the
assets, of the successor entity, at least as high as the Series A Preferred
Securities rank with respect to participation in the profits and dividends, and
in the assets, of Transamerica Delaware, (ii) Transamerica expressly
acknowledges such successor entity as the holder of the Series A Junior
Subordinated Debentures, (iii) the Series A Preferred Securities or any
Successor Securities are listed, or any Successor Securities will be listed upon
notification of issuance, on any national securities exchange or other
organization on which the Series A Preferred Securities are then listed, (iv)
such merger, consolidation, amalgamation or replacement does not cause the
Series A Preferred Securities (including any Successor Securities) to be
downgraded by any nationally recognized statistical rating organization, (v)
such merger, consolidation, amalgamation or replacement does not adversely
affect the powers, preferences and other special rights of the holders of the
Series A Preferred Securities (including any Successor Securities) in any
material respect (other than with respect to any dilution of the holders'
interest in the new entity), (vi) such successor entity has a purpose
substantially identical to that of Transamerica Delaware, (vii) prior to such
merger, consolidation, amalgamation or replacement, Transamerica has received an
opinion of nationally recognized independent counsel to Transamerica Delaware
experienced in such matters to the effect that (x) such successor entity will be
treated as a partnership for federal income tax purposes, (y) following such
merger, consolidation, amalgamation or replacement, Transamerica and such
successor entity will be in compliance with the 1940 Act without registering
thereunder as an investment company and (z) such merger, consolidation,
amalgamation or replacement will not adversely affect the limited liability of
the holders of the Series A Preferred Securities and (viii) Transamerica
guarantees the obligations of such successor entity under the Successor
Securities at least to the extent provided by the Guarantee.
VOTING RIGHTS
Except as provided below and under "Description of the Guarantee --
Amendments and Assignment" in the accompanying Prospectus and as otherwise
required by law and the Limited Partnership Agreement, the holders of the
Series A Preferred Securities will have no voting rights.
If (i) arrearages on dividends on the Series A Preferred Securities shall
exist for 18 consecutive monthly dividend periods; (ii) an Event of Default (as
defined in the Indenture) occurs and is continuing on the Series A Junior
Subordinated Debentures; or (iii) Transamerica is in default on any of its
payment obligations under the Guarantee (as described under "Description of the
Guarantee -- Certain Covenants of Transamerica" in the accompanying Prospectus),
then the holders of the Series A Preferred Securities, together with the holders
of any other series of Preferred Securities having the right to vote for the
appointment of a special representative of Transamerica Delaware and the limited
partners (a "Special Representative") in such event, acting as a single class,
will be entitled by the vote of a majority in aggregate liquidation preference
of such holders to appoint and authorize a Special Representative to enforce
Transamerica Delaware's creditor rights under the Series A Junior Subordinated
Debentures, to enforce the rights of the holders of the Series A Preferred
Securities under the Guarantee and to enforce the rights of the holders of the
Series A Preferred Securities to receive dividends (if and to the extent
declared) on
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the Series A Preferred Securities. The Special Representative shall not, by
virtue of acting in such capacity, be admitted as a general partner in
Transamerica Delaware or otherwise be deemed to be a general partner in
Transamerica Delaware and shall have no liability for the debts, obligations or
liabilities of Transamerica Delaware. Not later than 30 days after such right to
appoint a Special Representative arises, the General Partner will convene a
meeting for the purpose of appointing a Special Representative. If the General
Partner fails to convene such meeting within such 30-day period, the holders of
10% in liquidation preference of the outstanding Preferred Securities will be
entitled to convene such meeting. The provisions of the Limited Partnership
Agreement relating to the convening and conduct of the meetings of the partners
will apply with respect to any such meeting. In the event that, at any such
meeting, holders of less than a majority in aggregate liquidation preference of
Preferred Securities entitled to vote for the appointment of a Special
Representative vote for such appointment, no Special Representative shall be
appointed. Any Special Representative appointed shall cease to be a Special
Representative of Transamerica Delaware and the limited partners if Transamerica
Delaware (or Transamerica pursuant to the Guarantee) shall have paid in full all
accrued and unpaid dividends on the Preferred Securities or such default or
breach, as the case may be, shall have been cured, and Transamerica, in its
capacity as the General Partner, shall continue the business of Transamerica
Delaware without dissolution. Notwithstanding the appointment of any such
Special Representative, Transamerica shall continue as General Partner and shall
retain all rights under the Indenture, including the right to extend the
interest payment period from time to time to a period not exceeding 60
consecutive months as provided under "Description of the Series A Junior
Subordinated Debentures -- Option to Extend Interest Payment Period", and any
such extension would not constitute a default under the Indenture or enable a
holder of Series A Preferred Securities to require the payment of a dividend
that has not theretofore been declared.
If any proposed amendment to the Limited Partnership Agreement provides
for, or the General Partner otherwise proposes to effect, (i) any action that
would adversely affect the powers, preferences or special rights of the Series A
Preferred Securities, whether by way of amendment to the Limited Partnership
Agreement or otherwise (including, without limitation, the authorization or
issuance of any limited partner interests in Transamerica Delaware ranking, as
to participation in the profits or dividends or in the assets of Transamerica
Delaware, senior to the Series A Preferred Securities), or (ii) the dissolution,
winding-up or termination of Transamerica Delaware, other than (x) in connection
with the distribution of Series A Junior Subordinated Debentures upon the
occurrence of a Special Event or (y) as described under "Merger, Consolidation
or Amalgamation of Transamerica Delaware" above, then the holders of outstanding
Series A Preferred Securities will be entitled to vote on such amendment or
proposal of the General Partner (but not on any other amendment or proposal) as
a class with all other holders of series of Preferred Securities similarly
affected, and such amendment or proposal shall not be effective except with the
approval of the holders of 66 2/3% in liquidation preference of such outstanding
Preferred Securities having a right to vote on the matter; provided, however,
that no such approval shall be required if the dissolution, winding-up or
termination of Transamerica Delaware is proposed or initiated upon the
initiation of proceedings, or after proceedings have been initiated, for the
dissolution, winding-up, liquidation or termination of Transamerica.
The rights attached to the Series A Preferred Securities will be deemed not
to be adversely affected by the creation or issue of, and no vote will be
required for the creation or issue of, any further limited partner interests of
Transamerica Delaware ranking pari passu with the Series A Preferred Securities
with regard to participation in the profits or dividends or in the assets of
Transamerica Delaware. Holders of Series A Preferred Securities have no
preemptive rights.
So long as any Series A Junior Subordinated Debentures are held by
Transamerica Delaware, the General Partner shall not (i) direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee,
or executing any trust or power conferred on the Trustee with respect to such
series, (ii) waive any past default that is waivable under Section 6.06 of the
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Indenture, (iii) exercise any right to rescind or annul a declaration that the
principal of all the Series A Junior Subordinated Debentures shall be due and
payable or (iv) consent to any amendment, modification or termination of the
Indenture or the Series A Junior Subordinated Debentures, where such consent
shall be required, without, in each case, obtaining the prior approval of the
holders of at least 66 2/3% in liquidation preference of all series of Preferred
Securities who would be affected thereby if their Preferred Securities were to
be exchanged for Junior Subordinated Debentures, acting as a single class;
provided, however, that where a consent under the Indenture would require the
consent of each holder affected thereby, no such consent shall be given by the
General Partner without the prior consent of each holder of all series of
Preferred Securities affected thereby. The General Partner shall not revoke any
action previously authorized or approved by a vote of any series of Preferred
Securities. The General Partner shall notify all holders of the Series A
Preferred Securities of any notice of default received from the Trustee with
respect to the Series A Junior Subordinated Debentures.
Any required approval of holders of Series A Preferred Securities may be
given at a separate meeting of holders of Preferred Securities convened for such
purpose, at a meeting of all of the partners in Transamerica Delaware or
pursuant to written consent. Transamerica Delaware will cause a notice of any
meeting at which holders of Series A Preferred Securities are entitled to vote,
or of any matter upon which action by written consent of such holders is to be
taken, to be mailed to each holder of record of Series A Preferred Securities.
Each such notice will include a statement setting forth (i) the date of such
meeting or the date by which such action is to be taken, (ii) a description of
any resolution proposed for adoption at such meeting on which such holders are
entitled to vote or of such matter upon which written consent is sought and
(iii) instructions for the delivery of proxies or consents.
No vote or consent of the holders of Series A Preferred Securities will be
required for Transamerica Delaware to redeem and cancel Series A Preferred
Securities in accordance with the Limited Partnership Agreement.
Notwithstanding that holders of Series A Preferred Securities are entitled
to vote or consent under any of the circumstances described above, any of the
Series A Preferred Securities and any other series of Preferred Securities that
are entitled to vote or consent with such Series A Preferred Securities as a
single class at such time that are owned by Transamerica or by any entity more
than 50% of which is owned by Transamerica, either directly or indirectly, shall
not be entitled to vote or consent and shall, for purposes of such vote or
consent, be treated as if they were not outstanding.
Holders of the Series A Preferred Securities will have no rights to remove
or replace the General Partner.
BOOK-ENTRY-ONLY ISSUANCE -- THE DEPOSITORY TRUST COMPANY
DTC will act as securities depository for the Series A Preferred
Securities. The Series A Preferred Securities will be issued only as fully
registered securities registered in the name of Cede & Co. (DTC's nominee). One
or more fully registered global Series A Preferred Security certificates will be
issued, representing in the aggregate the total number of Series A Preferred
Securities, and will be deposited with DTC.
DTC is a limited-purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"). DTC holds securities that its
participants ("Participants") deposit with DTC. DTC also facilitates the
settlement among Participants of securities transactions, such as transfers and
pledges, in deposited securities through electronic computerized book-entry
changes in Participants' accounts, thereby eliminating the need for physical
movement of securities certificates. Direct Participants include securities
brokers and
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dealers, banks, trust companies, clearing corporations, and certain other
organizations ("Direct Participants"). DTC is owned by a number of its Direct
Participants and by the New York Stock Exchange, Inc. (the "New York Stock
Exchange"), the American Stock Exchange, Inc., and the National Association of
Securities Dealers, Inc. Access to the DTC system is also available to others
such as securities brokers and dealers, banks and trust companies that clear
through or maintain a custodial relationship with a Direct Participant, either
directly or indirectly ("Indirect Participants"). The rules applicable to DTC
and its Participants are on file with the Securities and Exchange Commission.
Purchases of Series A Preferred Securities within the DTC system must be
made by or through Direct Participants, which will receive a credit for the
Series A Preferred Securities on DTC's records. The ownership interest of each
actual purchaser of each Series A Preferred Security ("Beneficial Owner") is in
turn to be recorded on the Direct and Indirect Participants' records. Beneficial
Owners will not receive written confirmation from DTC of their purchases, but
Beneficial Owners are expected to receive written confirmations providing
details of the transactions, as well as periodic statements of their holdings,
from the Direct or Indirect Participants through which the Beneficial Owners
purchased Series A Preferred Securities. Transfers of ownership interests in the
Series A Preferred Securities are to be accomplished by entries made on the
books of Participants acting on behalf of Beneficial Owners. Beneficial Owners
will not receive certificates representing their ownership interests in Series A
Preferred Securities, except in the event that use of the book-entry system for
the Series A Preferred Securities is discontinued.
DTC has no knowledge of the actual Beneficial Owners of the Series A
Preferred Securities; DTC's records reflect only the identity of the Direct
Participants to whose accounts such Series A Preferred Securities are credited,
which may or may not be the Beneficial Owners. The Participants will remain
responsible for keeping account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time.
Redemption notices shall be sent to Cede & Co. If less than all of the
Series A Preferred Securities are being redeemed, DTC's practice is to determine
by lot the amount of the interest of each Direct Participant in such series to
be redeemed.
Although voting with respect to the Series A Preferred Securities is
limited, in those instances in which a vote is required, neither DTC nor Cede &
Co. itself will consent or vote with respect to Series A Preferred Securities.
Under its usual procedures, DTC would mail an Omnibus Proxy to Transamerica
Delaware as soon as possible after the record date. The Omnibus Proxy assigns
Cede & Co.'s consenting or voting rights to those Direct Participants to whose
accounts the Series A Preferred Securities are credited on the record date
(identified in a listing attached to the Omnibus Proxy).
Dividend payments on the Series A Preferred Securities will be made by
Transamerica Delaware to DTC. DTC's practice is to credit Direct Participants'
accounts on the relevant payment date in accordance with their respective
holdings shown on DTC's records unless DTC has reason to believe that it will
not receive payments on such payment date. Payments by Participants to
Beneficial Owners will be governed by standing instructions and customary
practices and will be the responsibility of such Participants and not of DTC,
Transamerica Delaware or Transamerica, subject to any statutory or regulatory
requirements as may be in effect from time to time. Payment of dividends to DTC
is the responsibility of Transamerica Delaware, disbursement of such payments to
Direct Participants is the responsibility of DTC, and disbursement of such
payments to the Beneficial Owners is the responsibility of Direct and Indirect
Participants.
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<PAGE> 20
DTC may discontinue providing its services as securities depository with
respect to the Series A Preferred Securities at any time by giving reasonable
notice to Transamerica Delaware. Under such circumstances, in the event that a
successor securities depository is not obtained, Series A Preferred Security
certificates are required to be printed and delivered. Additionally,
Transamerica Delaware (with the consent of Transamerica) may decide to
discontinue use of the system of book-entry transfers through DTC (or a
successor depository). In that event, certificates for the Series A Preferred
Securities will be printed and delivered. In each of the above circumstances,
the General Partner will appoint a paying agent with respect to the Series A
Preferred Securities.
The information in this section concerning DTC and DTC's book-entry system
has been obtained from sources that Transamerica Delaware and Transamerica
believe to be reliable, but Transamerica Delaware and Transamerica take no
responsibility for the accuracy thereof.
REGISTRAR AND TRANSFER AGENT
In the event the book-entry system for the Series A Preferred Securities is
discontinued, it is anticipated that The First National Bank of Chicago, or one
of its affiliates, will act as registrar and transfer agent for the Series A
Preferred Securities.
Registration of transfers of Series A Preferred Securities will be effected
without charge by or on behalf of Transamerica Delaware, but upon payment (with
the giving of such indemnity as Transamerica Delaware or Transamerica may
require) in respect of any tax or other governmental charges that may be imposed
in relation to it.
Transamerica Delaware will not be required to register or cause to be
registered the transfer of Series A Preferred Securities after such Series A
Preferred Securities have been called for redemption.
MISCELLANEOUS
Application has been made to list the Series A Preferred Securities on the
New York Stock Exchange. See "Underwriting."
The General Partner is authorized and directed to conduct its affairs and
to operate Transamerica Delaware in such a way that Transamerica Delaware will
not be deemed to be an "investment company" required to be registered under the
1940 Act or taxed as a corporation for federal income tax purposes and so that
the Series A Junior Subordinated Debentures will be treated as indebtedness of
Transamerica for federal income tax purposes. In this connection, the General
Partner is authorized to take any action, not inconsistent with applicable law,
the certificate of limited partnership of Transamerica Delaware or the Limited
Partnership Agreement, that the General Partner determines in its discretion to
be necessary or desirable for such purposes, as long as such action does not
adversely affect the interests of the holders of the Series A Preferred
Securities.
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<PAGE> 21
DESCRIPTION OF THE SERIES A JUNIOR SUBORDINATED DEBENTURES
Set forth below is a description of specific terms of the Series A Junior
Subordinated Debentures in which Transamerica Delaware will invest (i) the
proceeds of the issuance and sale of the Series A Preferred Securities and (ii)
the General Partner's capital contribution with respect to the Series A
Preferred Securities (the "General Partnership Payment"). This description
supplements the description of the general terms and provisions of the Junior
Subordinated Debentures set forth in the accompanying Prospectus under the
caption "Description of the Junior Subordinated Debentures". The following
description does not purport to be complete and is qualified in its entirety by
reference to the description in the accompanying Prospectus and the Indenture,
dated as of , 1994, between Transamerica and The First National Bank of
Chicago, as Trustee (the "Indenture") which has been filed as an exhibit to the
Registration Statement of which this Prospectus Supplement forms a part.
Under certain circumstances involving the dissolution of Transamerica
Delaware following the occurrence of a Special Event, Series A Junior
Subordinated Debentures may be distributed to the holders of the Series A
Preferred Securities in liquidation of Transamerica Delaware. See "Description
of the Series A Preferred Securities -- Special Event Redemption or
Distribution".
GENERAL
The Series A Junior Subordinated Debentures will be issued as a series of
Junior Subordinated Debentures under the Indenture. The Series A Junior
Subordinated Debentures will be limited in aggregate principal amount to
approximately $ million, such amount being the sum of the aggregate stated
liquidation preference of the Series A Preferred Securities and the General
Partnership Payment.
The entire principal amount of the Series A Junior Subordinated Debentures
will become due and payable, together with any accrued and unpaid interest
thereon, including Additional Interest (as hereinafter defined), if any, on
, 2024.
The Series A Junior Subordinated Debentures, if distributed to holders of
Series A Preferred Securities in dissolution will initially be so issued as a
Global Security (as defined below). As described herein, under certain limited
circumstances Series A Junior Subordinated Debentures may be issued in
certificated form in exchange for a Global Security. See "Book-Entry and
Settlement" below. In the event that Series A Junior Subordinated Debentures are
issued in certificated form, such Series A Junior Subordinated Debentures will
be in denominations of $25 and integral multiples thereof and may be transferred
or exchanged at the offices described below.
Payments on Series A Junior Subordinated Debentures issued as a Global
Security will be made to DTC, as the depository for the Series A Junior
Subordinated Debentures. In the event Series A Junior Subordinated Debentures
are issued in certificated form, principal and interest will be payable, the
transfer of the Series A Junior Subordinated Debentures will be registrable, and
Series A Junior Subordinated Debentures will be exchangeable for Series A Junior
Subordinated Debentures of other denominations of a like aggregate principal
amount, at the corporate trust office of the Trustee in The City of New York;
provided that payment of interest may be made at the option of Transamerica by
check mailed to the address of the persons entitled thereto.
If the Series A Junior Subordinated Debentures are distributed to the
holders of Series A Preferred Securities upon the dissolution of Transamerica
Delaware, Transamerica will use its best efforts to list the Series A Junior
Subordinated Debentures on the New York Stock Exchange or on such other exchange
as the Series A Preferred Securities are then listed.
MANDATORY PREPAYMENT
If Transamerica Delaware redeems Series A Preferred Securities in
accordance with the terms thereof, the Series A Junior Subordinated Debentures
will become due and payable in a principal
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<PAGE> 22
amount equal to the aggregate stated liquidation preference of the Series A
Preferred Securities so redeemed, together with any accrued and unpaid interest
thereon, including Additional Interest, if any. Any payment pursuant to this
provision shall be made prior to 12:00 noon, New York City time, on the date of
such redemption or at such other time on such earlier date as the parties
thereto shall agree. The Series A Junior Subordinated Debentures are not
entitled to the benefit of any sinking fund or, except as set forth above, any
other provision for mandatory prepayment.
OPTIONAL REDEMPTION
If there shall be no Series A Preferred Securities outstanding,
Transamerica shall have the right to redeem the Series A Junior Subordinated
Debentures, in whole or in part, from time to time, on or after ,
1999, upon not less than 30 nor more than 60 days' notice, at a redemption price
equal to 100% of the principal amount to be redeemed plus any accrued and unpaid
interest, including Additional Interest, if any, to the redemption date. If
Transamerica or Transamerica Delaware purchases Series A Preferred Securities by
tender, in the open market or by private agreement, Transamerica shall have the
right to redeem Series A Junior Subordinated Debentures, in an amount not to
exceed the aggregate stated liquidation preference of the Series A Preferred
Securities so purchased, together with any accrued and unpaid interest thereon,
including Additional Interest, if any, to the redemption date.
INTEREST
Each Series A Junior Subordinated Debenture will bear interest at the rate
of % per annum from the original date of issuance, payable monthly in
arrears on the last day of each calendar month of each year (each, an "Interest
Payment Date"), commencing , 1994, to the person in whose name such
Series A Junior Subordinated Debenture is registered, subject to certain
exceptions, at the close of business on the Business Day next preceding such
Interest Payment Date. In the event the Series A Junior Subordinated Debentures
shall not continue to remain in book-entry-only form, Transamerica shall have
the right to select record dates that shall be more than one Business Day prior
to the Interest Payment Date.
The amount of interest payable for any period will be computed on the basis
of a 360-day year of twelve 30-day months. In the event that any date on which
interest is payable on the Series A Junior Subordinated Debentures is not a
Business Day, then payment of the interest payable on such date will be made on
the next succeeding day that is a Business Day (and without any interest or
other payment in respect of any such delay), except that, if such Business Day
is in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
Transamerica shall have the right at any time during the term of the Series
A Junior Subordinated Debentures to extend the interest payment period from time
to time to a period not exceeding 60 consecutive months (the "Extension
Period"), at the end of which Extension Period Transamerica shall pay all
interest then accrued and unpaid (together with interest thereon at the rate
specified for the Series A Junior Subordinated Debentures to the extent
permitted by applicable law); provided that, during any such Extension Period,
Transamerica shall not declare or pay any dividend on, or purchase, acquire or
make a liquidation payment with respect to, any of its common stock. Prior to
the termination of any such Extension Period, Transamerica may further extend
the interest payment period, provided that such Extension Period together with
all such previous and further extensions thereof may not exceed 60 consecutive
months. Upon the termination of any Extension Period and the payment of all
amounts then due, Transamerica may select a new Extension Period, subject to the
above requirements. No interest shall be due and payable during an Extension
Period, except at the end thereof. The failure by Transamerica to make interest
payments during an Extension Period would not constitute a default or an event
of default under Transamerica's
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<PAGE> 23
currently outstanding indebtedness. If Transamerica Delaware shall be the sole
holder of the Series A Junior Subordinated Debentures, Transamerica shall give
Transamerica Delaware notice of its selection of such Extension Period one
Business Day prior to the earlier of (i) the date the dividends on the Series A
Preferred Securities are payable or (ii) the date Transamerica Delaware is
required to give notice to the New York Stock Exchange or other applicable
self-regulatory organization or to holders of the Series A Preferred Securities
of the record date or the date such dividend is payable, but in any event not
less than one Business Day prior to such record date. Transamerica shall cause
Transamerica Delaware to give notice of Transamerica's selection of such
Extension Period to the holders of the Series A Preferred Securities. If
Transamerica Delaware shall not be the sole holder of the Series A Junior
Subordinated Debentures, Transamerica shall give the holders of the Series A
Junior Subordinated Debentures notice of its selection of such Extension Period
ten Business Days prior to the earlier of (i) the Interest Payment Date or (ii)
the date Transamerica is required to give notice to the New York Stock Exchange
or other applicable self-regulatory organization or to holders of the Series A
Junior Subordinated Debentures of the record or payment date of such related
interest payment, but in any event not less than two Business Days prior to such
record date.
ADDITIONAL INTEREST
If at any time Transamerica Delaware shall be required to pay any interest
on dividends in arrears in respect of the Series A Preferred Securities pursuant
to the terms thereof, then Transamerica will pay as interest to Transamerica
Delaware as the holder of the Series A Junior Subordinated Debentures
("Additional Interest") an amount equal to such interest on dividends in
arrears.
SET-OFF
Notwithstanding anything to the contrary in the Indenture, Transamerica
shall have the right to set-off any payment it is otherwise required to make
thereunder with and to the extent Transamerica has theretofore made, or is
concurrently on the date of such payment making, a payment under the Guarantee.
EVENTS OF DEFAULT
In the case that any Event of Default (as defined in the Indenture and as
described in the accompanying Prospectus) shall occur and be continuing,
Transamerica Delaware will have the right to declare the principal of and the
interest on the Series A Junior Subordinated Debentures (including any
Additional Interest) and any other amounts payable under the Indenture to be
forthwith due and payable and to enforce its other rights as a creditor with
respect to the Series A Junior Subordinated Debentures. See "Enforcement of
Certain Rights by Special Representative" below for a discussion of certain
rights available to holders of the Series A Preferred Securities upon the
occurrence of an Event of Default.
ENFORCEMENT OF CERTAIN RIGHTS BY SPECIAL REPRESENTATIVE
If (i) arrearages on dividends on the Series A Preferred Securities shall
exist for 18 consecutive monthly dividend periods; (ii) an Event of Default
occurs and is continuing on the Series A Junior Subordinated Debentures; or
(iii) Transamerica is in default on any of its payment obligations under the
Guarantee, under the terms of the Series A Preferred Securities, the holders of
outstanding Series A Preferred Securities will have the rights referred to under
"Description of the Series A Preferred Securities -- Voting Rights", including
the right to appoint a Special Representative, which Special Representative
shall be authorized to exercise Transamerica Delaware's right to accelerate the
principal amount of the Series A Junior Subordinated Debentures upon an Event of
Default and to enforce Transamerica Delaware's other creditor rights under the
Series A Junior Subordinated Debentures. Notwithstanding the appointment of any
such Special Representative, Transamerica shall continue as General Partner and
shall retain all rights under the Indenture, including the right to extend the
interest payment period from time to time to a period not exceeding 60
consecutive months, and any such extension shall not constitute a default under
the Indenture, or enable a holder of Series A Preferred Securities to require
the payment of a dividend that has not theretofore been declared.
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<PAGE> 24
BOOK-ENTRY AND SETTLEMENT
If distributed to holders of Series A Preferred Securities in connection
with the dissolution of Transamerica Delaware as a result of the occurrence of a
Special Event, the Series A Junior Subordinated Debentures will be issued in the
form of one or more global certificates (each, a "Global Security") registered
in the name of the nominee of DTC. Except under the limited circumstances
described below, Series A Junior Subordinated Debentures represented by the
Global Security will not be exchangeable for, and will not otherwise be issuable
as, Series A Junior Subordinated Debentures in definitive form. The Global
Securities described above may not be transferred except by DTC to a nominee of
DTC or by a nominee of DTC to DTC or another nominee of DTC or to a successor
depository or its nominee.
Except as provided below, owners of beneficial interests in such a Global
Security will not be entitled to receive physical delivery of Series A Junior
Subordinated Debentures in definitive form and will not be considered the
Holders (as defined in the Indenture) thereof for any purpose under the
Indenture, and no Global Security representing Series A Junior Subordinated
Debentures shall be exchangeable, except for another Global Security of like
denomination and tenor to be registered in the name of DTC or its nominee or to
a successor depository or its nominee. Accordingly, each beneficial owner must
rely on the procedures of DTC and, if such person is not a Participant, on the
procedures of the Participant through which such person owns its interest, to
exercise any rights of a Holder under the Indenture.
The Depository. DTC will act as security depository for the Series A
Junior Subordinated Debentures. For a description of DTC and the specific terms
of the depository arrangements, see "Description of the Series A Preferred
Securities -- Book-Entry-Only Issuance -- The Depository Trust Company". As of
the date of this Prospectus Supplement, the description therein of DTC's
book-entry system and DTC's practices as they relate to purchases, transfers,
notices and payments with respect to the Series A Preferred Securities apply in
all material respects to any debt obligations represented by one or more Global
Securities held by DTC.
Neither Transamerica, the Trustee, any paying agent nor any other agent of
Transamerica or the Trustee will have any responsibility or liability for any
aspect of the records relating to or payments made on account of beneficial
ownership interests in a Global Security for such Series A Junior Subordinated
Debentures or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
Discontinuance of the Depository's Services. A Global Security shall be
exchangeable for Series A Junior Subordinated Debentures registered in the names
of persons other than DTC or its nominee only if (i) DTC notifies Transamerica
that it is unwilling or unable to continue as a depository for such Global
Security and no successor depository shall have been appointed, or if any time
DTC ceases to be a clearing agency registered under the Exchange Act at a time
when DTC is required to be so registered to act as such depository, (ii)
Transamerica in its sole discretion determines that such Global Security shall
be so exchangeable or (iii) there shall have occurred an Event of Default with
respect to such Series A Junior Subordinated Debentures. Any Global Security
that is exchangeable pursuant to the preceding sentence shall be exchangeable
for Series A Junior Subordinated Debentures registered in such names as the
Depository shall direct. It is expected that such instructions will be based
upon directions received by the Depository from its Participants with respect to
ownership of beneficial interests in such Global Security.
MISCELLANEOUS
For restrictions on certain actions of the General Partner with respect to
Series A Junior Subordinated Debentures held by Transamerica Delaware, see
"Description of the Series A Preferred Securities -- Voting Rights".
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<PAGE> 25
RELATIONSHIP BETWEEN THE SERIES A PREFERRED SECURITIES, THE
SERIES A JUNIOR SUBORDINATED DEBENTURES AND THE GUARANTEE
As long as payments of interest and other payments are made when due on the
Series A Junior Subordinated Debentures, such payments will be sufficient to
cover dividends (if and to the extent declared) and other payments due on the
Series A Preferred Securities primarily because (i) the aggregate principal
amount of Series A Junior Subordinated Debentures will be equal to the sum of
the aggregate stated liquidation preference of the Series A Preferred Securities
and the General Partnership Payment; (ii) the interest rate and interest and
other payment dates on the Series A Junior Subordinated Debentures will match
the dividend rate and dividend and other payment dates for the Series A
Preferred Securities; (iii) the Limited Partnership Agreement provides that
Transamerica, as General Partner, shall pay for all, and Transamerica Delaware
shall not be obligated to pay, directly or indirectly, for any, costs and
expenses of Transamerica Delaware, including any income taxes, duties and other
governmental charges, and all costs and expenses with respect thereto, to which
Transamerica Delaware may become subject, except for United States withholding
taxes; and (iv) the Limited Partnership Agreement further provides that the
General Partner shall not cause or permit Transamerica Delaware, among other
things, to engage in any activity that is not consistent with the limited
purposes of Transamerica Delaware.
Payments of dividends (if and to the extent declared) and other payments
due on the Series A Preferred Securities are guaranteed by Transamerica as and
to the extent set forth under "Description of the Guarantee" in the accompanying
Prospectus. If Transamerica does not make interest payments on the Series A
Junior Subordinated Debentures purchased by Transamerica Delaware, it is
expected that Transamerica Delaware will not declare or pay dividends on the
Series A Preferred Securities. The Guarantee is a full and unconditional
guarantee from the time of issuance of the Series A Preferred Securities, but
does not apply to any payment of dividends unless and until such dividends are
declared.
If Transamerica fails to make interest or other payments on the Series A
Junior Subordinated Debentures when due, the Limited Partnership Agreement
provides a mechanism whereby the holders of the Series A Preferred Securities
may appoint a Special Representative to enforce the rights of Transamerica
Delaware under the Series A Junior Subordinated Debentures. The Limited
Partnership Agreement also provides, and Transamerica, under the Guarantee,
acknowledges, that a Special Representative may be appointed to enforce the
Guarantee if Transamerica is in default on any of its payment obligations under
the Guarantee. In addition, if the General Partner or the Special Representative
fails to enforce the Guarantee, a holder of a Series A Preferred Security may,
after a period of 30 days has elapsed from such holder's written request to the
General Partner or the Special Representative, as the case may be, to enforce
the Guarantee, institute a legal proceeding directly against Transamerica to
enforce its rights under the Guarantee without first instituting a legal
proceeding against Transamerica Delaware or any other person or entity.
If a Special Event shall occur and be continuing, the General Partner may
elect to dissolve Transamerica Delaware, and to cause Series A Junior
Subordinated Debentures to be distributed in exchange for the outstanding Series
A Preferred Securities. The Series A Preferred Securities represent limited
partner interests in Transamerica Delaware, a limited partnership which exists
for the sole purpose of issuing its partnership interests and investing the
proceeds thereof in debt securities of Transamerica, while the Series A Junior
Subordinated Debentures represent indebtedness of Transamerica, a diversified
financial services company (see "Transamerica Corporation"). A principal
difference between the rights of a holder of Series A Preferred Securities and a
holder of Series A Junior Subordinated Debentures is that the Series A Junior
Subordinated Debentures will accrue, and (subject to the permissible extension
of the interest period) a holder thereof will be entitled to receive, interest
on the principal amount of Series A Junior Subordinated Debentures held, while a
holder of Series A Preferred Securities is only entitled to receive dividends if
and to the extent declared by the General Partner.
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<PAGE> 26
Upon any voluntary or involuntary dissolution, winding-up or termination of
Transamerica Delaware, the holders of Series A Preferred Securities will be
entitled to receive, out of assets legally available for distribution to
partners, the Liquidation Distribution in cash or Series A Junior Subordinated
Debentures and will be entitled to the benefits of the Guarantee with respect to
any such distribution. See "Description of the Series A Preferred
Securities -- Liquidation Distribution Upon Dissolution". Upon any voluntary or
involuntary liquidation or bankruptcy of Transamerica, the holders of Series A
Junior Subordinated Debentures would be subordinated creditors of Transamerica,
subordinated in right of payment to all Senior Indebtedness, but entitled to
receive payment in full of principal, premium, if any, and interest, before any
stockholders of Transamerica receive payments or distributions.
A default or event of default under any Senior Indebtedness would not
constitute a default or event of default under the Series A Junior Subordinated
Debentures. However, in the event of payment defaults under, or acceleration of,
Senior Indebtedness, the subordination provisions of the Series A Junior
Subordinated Debentures provide that no payments may be made in respect of the
Series A Junior Subordinated Debentures. Failure to make required payments on
the Series A Junior Subordinated Debentures would constitute an event of default
under the Indenture.
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<PAGE> 27
UNITED STATES TAXATION
GENERAL
This section is a summary of certain United States federal income tax
considerations that may be relevant to prospective purchasers of Series A
Preferred Securities and represents the opinion of Wachtell, Lipton, Rosen &
Katz, special counsel to Transamerica and Transamerica Delaware, insofar as it
relates to matters of law and legal conclusions. This section is based upon
current provisions of the Internal Revenue Code of 1986, as amended (the
"Code"), existing and proposed regulations thereunder and current administrative
rulings and court decisions, all of which are subject to change. Subsequent
changes may cause tax consequences to vary substantially from the consequences
described below.
No attempt has been made in the following discussion to comment on all
United States federal income tax matters affecting purchasers of Series A
Preferred Securities. Moreover, the discussion generally focuses on holders of
Series A Preferred Securities who are individual citizens or residents of the
United States and who hold the Series A Preferred Securities as capital assets.
This discussion has only limited application to corporations, estates, trusts or
non-resident aliens. Accordingly, each prospective purchaser of Series A
Preferred Securities should consult, and should depend on, the purchaser's own
tax advisor in analyzing the federal, state, local and foreign tax consequences
of the purchase, ownership or disposition of Series A Preferred Securities.
OPINION OF COUNSEL
In the opinion of Wachtell, Lipton, Rosen & Katz, (i) Transamerica Delaware
will be a partnership for federal income tax purposes; and (ii) the Series A
Junior Subordinated Debentures will be classified as indebtedness of
Transamerica. Several recent pronouncements of the Internal Revenue Service (the
"IRS"), however, evidence increasing concern by the IRS over arrangements
similar in some respects to those involving Transamerica Delaware, the Series A
Preferred Securities, and the Series A Junior Subordinated Debentures. While
these pronouncements are not considered to apply to the arrangements described
herein, it is possible that future pronouncements or other developments could
adversely affect such arrangements. It should be noted in this connection that
Transamerica has the right to redeem the Series A Preferred Securities or
dissolve Transamerica Delaware upon the occurrence of a Tax Event (as defined
under "Description of the Series A Preferred Securities -- Special Event
Redemption or Distribution").
INCOME FROM SERIES A PREFERRED SECURITIES
Each holder of Series A Preferred Securities (a "Preferred Securityholder")
will be required to include in gross income the Preferred Securityholder's
distributive share of the net income of Transamerica Delaware. Such income
should not exceed the dividends received on such Series A Preferred Securities,
except in limited circumstances as described below under "Potential Extension of
Interest Payment Period". No portion of such income will be eligible for the
dividends received deduction.
Transamerica Delaware does not currently intend to make an election under
Section 754 of the Code. As a result, a subsequent purchaser of Series A
Preferred Securities in the secondary market will not be permitted or required
to adjust the tax basis in its allocable share of Transamerica Delaware's assets
so as to reflect any difference between its purchase price for the Preferred
Securities and the underlying tax basis of Transamerica Delaware in its assets.
As a result, a Preferred Securityholder may be allocated a larger or smaller
amount of Transamerica Delaware's income than would otherwise be appropriate
based upon such Preferred Securityholder's purchase price for the Preferred
Security.
Under Section 708 of the Code, Transamerica Delaware will be deemed to
terminate for federal income tax purposes if 50% or more of the capital and
profits interest in Transamerica Delaware is
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sold or exchanged within a 12-month period. If such a termination occurs, there
will be a closing of Transamerica Delaware's taxable year for all partners and
Transamerica Delaware will be considered to distribute its assets to the
partners, who would then be treated as recontributing those assets to a new
partnership. Those assets might have a basis higher or lower than their basis in
the hands of Transamerica Delaware prior to termination, which might alter the
tax consequences to Preferred Securityholders.
DISPOSITION OF SERIES A PREFERRED SECURITIES
Gain or loss will be recognized on a sale of Series A Preferred Securities,
including a redemption for cash, equal to the difference between the amount
realized and the Preferred Securityholder's tax basis for the Series A Preferred
Securities sold. Gain or loss recognized by a Preferred Securityholder on the
sale or exchange of a Series A Preferred Security held for more than one year
generally will be taxable as long-term capital gain or loss.
RECEIPT OF SERIES A JUNIOR SUBORDINATED DEBENTURES
UPON LIQUIDATION OF TRANSAMERICA DELAWARE
Under certain circumstances, as described under the caption "Description of
the Series A Preferred Securities -- Special Event Redemption or Distribution",
Series A Junior Subordinated Debentures may be distributed to the Preferred
Securityholders in liquidation of Transamerica Delaware. Under current United
States federal income tax law, such a distribution would be treated as a
non-taxable exchange to each Preferred Securityholder and would result in the
Preferred Securityholder receiving an aggregate tax basis in the Series A Junior
Subordinated Debentures equal to such Preferred Securityholder's aggregate tax
basis in its Series A Preferred Securities. A Preferred Securityholder's holding
period in the Series A Junior Subordinated Debentures so received in liquidation
of Transamerica Delaware would include the period for which the Series A
Preferred Securities were held by such Preferred Securityholder. As a result, in
certain circumstances the Series A Junior Subordinated Debentures received in
liquidation might bear "market discount", "amortizable bond premium", or
"acquisition premium" which might alter the tax treatment of such Debentures in
the hands of the Preferred Securityholder as compared with the consequences of
holding Series A Preferred Securities. Under a change in law, a change in legal
interpretation or the other circumstances giving rise to a Special Event,
however, the dissolution could be a taxable event to Preferred Securityholders.
TRANSAMERICA DELAWARE INFORMATION RETURNS AND AUDIT PROCEDURES
Transamerica, as the General Partner in Transamerica Delaware, will furnish
each Preferred Securityholder with a Schedule K-1 each year setting forth such
Preferred Securityholder's allocable share of income for the prior calendar
year. Transamerica is required to furnish such Schedule K-1 as soon as
practicable following the end of the year, but in any event prior to March 31 of
the following year.
Any person who holds Series A Preferred Securities as a nominee for another
person is required to furnish to Transamerica Delaware (a) the name, address and
taxpayer identification number of each of the beneficial owner and the nominee;
(b) information as to whether the beneficial owner is (i) a person that is not a
United States person, (ii) a foreign government, an international organization
or any wholly-owned agency or instrumentality of either of the foregoing, or
(iii) a tax-exempt entity; (c) the amount and description of Series A Preferred
Securities held, acquired or transferred for the beneficial owner; and (d)
certain information including the dates of acquisitions and transfers, means of
acquisitions and transfers, and acquisition cost for purchases, as well as the
amount of net proceeds from sales. Brokers and financial institutions are
required to furnish additional information, including whether they are United
States persons and certain information on Series A Preferred Securities they
acquire, hold or transfer for their own accounts. A penalty of $50 per failure
(up to a maximum of $100,000 per calendar year) is imposed by the Code for
failure to report such information to Transamerica Delaware. The nominee is
required to supply
S-26
<PAGE> 29
the beneficial owners of the Series A Preferred Securities with the information
furnished to Transamerica Delaware.
POTENTIAL EXTENSION OF INTEREST PAYMENT PERIOD
Under the Indenture, Transamerica has the right to extend from time to time
the interest payment period on the Series A Junior Subordinated Debentures to a
period not exceeding 60 consecutive months. In the event that the interest
payment period is extended, Transamerica Delaware will continue to accrue income
equal to the amount of the interest payment due at the end of the Extension
Period, on an economic basis over the length of the Extension Period.
Accrued income will be allocated, but not distributed, to holders of record
on the Business Day preceding the last day of each calendar month. As a result,
holders of record during an Extension Period will include interest in their
gross income in advance of the receipt of cash, and any such holders who dispose
of Series A Preferred Securities prior to the record date for the payment of
dividends following such Extension Period will include interest in their gross
income but will not receive any cash related thereto from Transamerica Delaware.
The tax basis of a Series A Preferred Security will be increased by the amount
of any interest that is included in income without a receipt of cash, and will
be decreased again when and if such cash is subsequently received from
Transamerica Delaware.
UNITED STATES ALIEN HOLDERS
For purposes of this discussion, a "United States Alien Holder" is any
holder who or which is (i) a nonresident alien individual or (ii) a foreign
corporation, partnership or estate or trust, in either case not subject to
United States federal income tax on a net income basis in respect of a Series A
Preferred Security.
Under current United States federal income tax law, subject to the
discussion below with respect to backup withholding:
(i) payments by Transamerica Delaware or any of its paying agents to
any holder of a Series A Preferred Security who or which is a United States
Alien Holder should not be subject to United States federal withholding tax
provided that (a) the beneficial owner of the Series A Preferred Security
does not actually or constructively own 10% or more of the total combined
voting power of all classes of capital stock of Transamerica entitled to
vote, (b) the beneficial owner of the Series A Preferred Security is not a
controlled foreign corporation that is related to Transamerica through
stock ownership and (c) either (x) the beneficial owner of the Series A
Preferred Security certifies to Transamerica Delaware or its agent, under
penalties of perjury, that it is a United States Alien Holder and provides
its name and address or (y) the holder of the Series A Preferred Security
is a securities clearing organization, bank or other financial institution
that holds customers' securities in the ordinary course of its trade or
business (a "financial institution"), and such holder certifies to
Transamerica Delaware or its agent under penalties of perjury that such
statement has been received from the beneficial owner by it or by a
financial institution between it and the beneficial owner and furnishes
Transamerica Delaware or its agent with a copy thereof; and
(ii) a United States Alien Holder of a Series A Preferred Security
generally will not be subject to United States federal withholding tax on
any gain realized on the sale or exchange of a Series A Preferred Security
unless such holder is present in the United States for 183 days or more in
the taxable year of sale and either has a "tax home" in the United States
or certain other requirements are met.
In the event that the Series A Preferred Securities were characterized as
stock or other equity of Transamerica, payments to a holder characterized as
dividends could be subject to a 30% withholding tax or such lesser amount as may
be provided under an applicable treaty.
S-27
<PAGE> 30
BACKUP WITHHOLDING AND INFORMATION REPORTING
In general, information reporting requirements will apply to payments to
noncorporate United States holders of the proceeds of the sale of Series A
Preferred Securities within the United States and "backup withholding" at a rate
of 31% will apply to such payments if the United States holder fails to provide
an accurate taxpayer identification number.
Payments of the proceeds from the sale by a United States Alien Holder of
Series A Preferred Securities made to or through a foreign office of a broker
generally will not be subject to information reporting or backup withholding,
except that, if the broker is a United States person, a controlled foreign
corporation for United States tax purposes, or a foreign person 50% or more of
whose gross income is effectively connected with a United States trade or
business for a specified three-year period, information reporting may apply to
such payments. Payments of the proceeds from the sale of Series A Preferred
Securities to or through the United States office of a broker is subject to
information reporting and backup withholding unless the holder or beneficial
owner certifies as to its non-United States status or otherwise establishes an
exemption from information reporting and backup withholding.
S-28
<PAGE> 31
UNDERWRITING
Subject to the terms and conditions of the Underwriting Agreement,
Transamerica Delaware has agreed to sell to each of the Underwriters named
below, and each of the Underwriters, for whom Goldman, Sachs & Co.
and , are acting as Representatives, has severally agreed to
purchase from Transamerica Delaware, the respective number of Series A Preferred
Securities set forth opposite its name below:
<TABLE>
<CAPTION>
NUMBER OF
PREFERRED
UNDERWRITER SECURITIES
----------------------------------------------------------------- ---------
<S> <C>
Goldman, Sachs & Co..............................................
---------
Total..................................................
=========
</TABLE>
The Underwriters propose to offer the Series A Preferred Securities in part
directly to the public at the initial public offering price set forth on the
cover page of this Prospectus Supplement, and in part to certain securities
dealers at such price less a concession of $ per Series A Preferred
Security. The Underwriters may allow, and such dealers may reallow, a concession
not in excess of $ per Series A Preferred Security to certain brokers
and dealers. After the Series A Preferred Securities are released for sale to
the public, the offering price and other selling terms may from time to time be
varied by the Representatives.
In view of the fact that the proceeds of the sale of the Series A Preferred
Securities ultimately will be used to purchase the Series A Junior Subordinated
Debentures, the Underwriting Agreement provides that Transamerica will pay as
compensation ("Underwriters' Compensation"), for the Underwriters' arranging the
investment therein of such proceeds, an amount in
funds of $ per Series A Preferred Security ($ per Series A
Preferred Security sold to certain institutions) for the accounts of the several
Underwriters.
Transamerica and Transamerica Delaware have agreed, during the period
beginning from the date of the Underwriting Agreement and continuing to and
including the later of (i) the termination of trading restrictions for the
Series A Preferred Securities, as notified to Transamerica by the
Representatives and (ii) the latest time of delivery for such Series A Preferred
Securities, not to offer, sell, contract to sell or otherwise dispose of, except
in accordance with the Underwriting Agreement, any Preferred Securities, any
preferred stock or any other securities of Transamerica or Transamerica Delaware
that are substantially similar to the Series A Preferred Securities, including
but not limited to any securities that are convertible into or exchangeable for,
or that represent the right to receive, Preferred Securities, preferred stock or
substantially similar securities of Transamerica or Transamerica Delaware,
without the prior written consent of the Representatives.
Application has been made to list the Series A Preferred Securities on the
New York Stock Exchange. Prior to this offering, there has been no public market
for the Series A Preferred Securities. In order to meet one of the requirements
for listing the Series A Preferred Securities on the New York Stock Exchange,
the Underwriters will undertake to sell lots of 100 or more Series A Preferred
Securities to a minimum of 400 beneficial holders. Trading of the Series A
Preferred Securities on the New York Stock Exchange is expected to commence
within a seven-day period after the initial delivery of the Series A Preferred
Securities. The Representatives have advised Transamerica that they intend to
make a market in the Series A Preferred Securities prior to the
S-29
<PAGE> 32
commencement of trading on the New York Stock Exchange, but are not obligated to
do so and may discontinue market making at any time without notice.
Transamerica Delaware and Transamerica have agreed to indemnify the
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933, as amended.
Certain of the Underwriters engage in transactions with, and from time to
time have performed services for, Transamerica and its subsidiaries in the
ordinary course of business.
LEGAL MATTERS
Certain matters of Delaware law relating to the validity of the Series A
Preferred Securities, the validity of the Limited Partnership Agreement and the
formation of Transamerica Delaware are being passed upon by Richards, Layton &
Finger, P.A., special Delaware counsel to Transamerica and Transamerica
Delaware. The validity of the Indenture, the Guarantee and the Series A Junior
Subordinated Debentures will be passed upon on behalf of Transamerica Delaware
and Transamerica by Christopher M. McLain, Esq., Senior Vice President and
General Counsel of Transamerica, and on behalf of the Underwriters by Cleary,
Gottlieb, Steen & Hamilton, counsel to the Underwriters. Statements as to United
States taxation in the Prospectus Supplement in the second paragraph under the
caption "Investment Considerations -- Special Event Redemption or Distribution",
and under the caption "United States Taxation", have been passed upon for
Transamerica and Transamerica Delaware by Wachtell, Lipton, Rosen & Katz,
special tax counsel to Transamerica and Transamerica Delaware, and are stated
herein on their authority.
S-30
<PAGE> 33
================================================================================
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE
PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT AND THE
PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO
BUY ANY SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS PROSPECTUS
SUPPLEMENT AND THE PROSPECTUS OR AN OFFER TO SELL OR THE SOLICITATION OF AN
OFFER TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR
SOLICITATION IS UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR
THE PROSPECTUS NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN OR
THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION.
---------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PROSPECTUS SUPPLEMENT
PAGE
----
<S> <C>
Transamerica Delaware.................... S-4
Transamerica Corporation................. S-4
Investment Considerations................ S-5
Summary Consolidated Financial Data...... S-7
Capitalization of Transamerica........... S-8
Use of Proceeds.......................... S-8
Description of the Series A Preferred
Securities............................. S-9
Description of the Series A Junior
Subordinated Debentures................ S-19
Relationship between the Series A
Preferred Securities, the Series A
Junior Subordinated Debentures and the
Guarantee.............................. S-23
United States Taxation................... S-25
Underwriting............................. S-29
Legal Matters............................ S-30
PROSPECTUS
Available Information.................... 2
Incorporation of Certain Documents by
Reference.............................. 3
Transamerica Delaware.................... 3
Transamerica Corporation................. 3
Consolidated Ratios of Earnings to Fixed
Charges and Earnings to Combined Fixed
Charges and Preferred Stock Dividends
of Transamerica........................ 4
Use of Proceeds.......................... 4
Description of the Preferred
Securities............................. 5
Description of the Guarantee............. 6
Description of the Junior Subordinated
Debentures............................. 8
Plan of Distribution..................... 13
Experts.................................. 14
Legal Opinions........................... 14
</TABLE>
================================================================================
================================================================================
PREFERRED SECURITIES
TRANSAMERICA DELAWARE
% CUMULATIVE MONTHLY INCOME
PREFERRED SECURITIES, SERIES A
GUARANTEED TO THE EXTENT
SET FORTH HEREIN BY
TRANSAMERICA CORPORATION
------------------
(LOGO)
------------------
GOLDMAN, SACHS & CO.
REPRESENTATIVES OF THE UNDERWRITERS
================================================================================
<PAGE> 34
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SUPPLEMENT SHALL NOT CONSTITUTE AN OFFER
TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE
OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE
WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE
SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED OCTOBER 10, 1994
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED OCTOBER , 1994
[ ] PREFERRED SECURITIES
TRANSAMERICA DELAWARE
CUMULATIVE ADJUSTABLE RATE MONTHLY INCOME PREFERRED SECURITIES,
SERIES A ("MIPS"*)
(LIQUIDATION PREFERENCE $25 PER PREFERRED SECURITY)
[LOGO] GUARANTEED TO THE EXTENT SET FORTH HEREIN BY
TRANSAMERICA CORPORATION
---------------------
The Cumulative Adjustable Rate Monthly Income Preferred Securities, Series
A (the "Series A Preferred Securities"), representing the limited partner
interests offered hereby are being issued by Transamerica Delaware, L.P., a
limited partnership formed under the laws of the State of Delaware
("Transamerica Delaware"). Transamerica Corporation, a Delaware corporation
("Transamerica"), is the sole general partner in Transamerica Delaware.
Transamerica Delaware exists for the sole purpose of issuing its partnership
interests and investing the proceeds thereof in debt securities of Transamerica.
The limited partner interests represented by the Series A Preferred Securities
will have a preference with respect to cash distributions and amounts payable on
liquidation over the general partner's interest in Transamerica Delaware.
(Continued on next page)
---------------------
SEE "INVESTMENT CONSIDERATIONS" FOR CERTAIN INFORMATION RELEVANT TO AN
INVESTMENT IN THE SERIES A PREFERRED SECURITIES, INCLUDING THE PERIOD AND
CIRCUMSTANCES DURING AND UNDER WHICH PAYMENTS ON THE SERIES A PREFERRED
SECURITIES AND SERIES A JUNIOR SUBORDINATED DEBENTURES MAY BE DEFERRED AND THE
RELATED FEDERAL INCOME TAX CONSEQUENCES.
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR
THE PROSPECTUS TO WHICH IT RELATES. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
---------------------
<TABLE>
<CAPTION>
PROCEEDS TO
INITIAL PUBLIC UNDERWRITING TRANSAMERICA
OFFERING PRICE COMMISSION(1) DELAWARE(2)(3)
-------------- ------------- --------------
<S> <C> <C> <C>
Per Series A Preferred Security....................... $ (2) $
Total................................................. $ (2) $
</TABLE>
- ---------------
(1) Transamerica Delaware and Transamerica have agreed to indemnify the several
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933, as amended. See "Underwriting".
(2) In view of the fact that the proceeds of the sale of the Series A Preferred
Securities ultimately will be invested in Series A Junior Subordinated
Debentures (as hereinafter defined), the Underwriting Agreement provides
that Transamerica will pay to the Underwriters, as compensation
("Underwriters' Compensation") for their arranging the investment therein of
such proceeds, $ per Series A Preferred Security; provided, that such
compensation will be $ per Series A Preferred Security sold to
certain institutions. Accordingly, the maximum aggregate amount of
Underwriters' Compensation will be $ , but the actual amount of
Underwriters' Compensation will be less than such amount to the extent that
Series A Preferred Securities are sold to such institutions. See
"Underwriting".
(3) Expenses of the offering, which are payable by Transamerica, are estimated
to be $ .
---------------------
The Series A Preferred Securities offered hereby are offered severally by
the Underwriters, as specified herein, subject to receipt and acceptance by them
and subject to their right to reject any order in whole or in part. It is
expected that delivery of the Series A Preferred Securities will be made only in
book-entry form through the facilities of The Depository Trust Company on or
about , 1994.
- ---------------
* An application has been filed by Goldman, Sachs & Co. with the United States
Patent and Trademark Office for the registration of the MIPS servicemark.
GOLDMAN, SACHS & CO.
---------------------
The date of this Prospectus Supplement is , 1994.
<PAGE> 35
(Continued from front cover)
Cash distributions on the Series A Preferred Securities will be cumulative
from the date of original issuance and will be payable monthly in arrears on the
last day of each calendar month of each year, commencing , 1994
("dividends"), if and to the extent determined to be payable ("declared") by
Transamerica in its capacity as general partner of Transamerica Delaware (the
"General Partner"). The dividend rate will be adjusted quarterly. The rate for
the initial period from the date of initial issuance to , 1994 will
be % per annum, which is equivalent to $ per Series A Preferred
Security per annum. Thereafter, dividends on the Series A Preferred Securities
will be payable at the "Applicable Rate" from time to time in effect. The
Applicable Rate for any quarter will be equal to % of the highest of the
"Treasury Bill Rate", the "Ten Year Constant Maturity Rate" and the "Thirty Year
Constant Maturity Rate" (each as defined herein) determined in advance of such
quarter, but not less than % per annum nor greater than % per annum.
See "Description of the Series A Preferred Securities -- Dividends".
The payment of dividends (if and to the extent declared) and payments on
liquidation of Transamerica Delaware and the redemption of Series A Preferred
Securities, as set forth below, are guaranteed by Transamerica to the extent
described herein and in the accompanying Prospectus (the "Guarantee"). See
"Description of the Guarantee" in the accompanying Prospectus. The proceeds of
the offering of the Series A Preferred Securities will be used by Transamerica
Delaware to purchase from Transamerica its Adjustable Rate Junior Subordinated
Deferrable Interest Debentures, Series A, Due 2024 (the "Series A Junior
Subordinated Debentures"). Transamerica has the right from time to time to defer
the payment of interest on the Series A Junior Subordinated Debentures for one
or more Extension Periods (as hereinafter defined) at the end of each of which
all accrued and unpaid interest is required to be paid in full. If Transamerica
does not make interest payments on the Series A Junior Subordinated Debentures,
it is expected that Transamerica Delaware will not declare or pay dividends on
the Series A Preferred Securities. The Guarantee is a full and unconditional
guarantee from the time of issuance of the Series A Preferred Securities, but
does not apply to any payment of dividends unless and until such dividends are
declared.
The Series A Preferred Securities are redeemable at the option of
Transamerica Delaware, in whole or in part, from time to time, on or after
, 1999, at $25 per Series A Preferred Security plus accrued and
unpaid dividends thereon to the date fixed for redemption, payable in cash (the
"Redemption Price"). See "Description of the Series A Preferred
Securities -- Optional Redemption". The Series A Preferred Securities have no
maturity date, although they are mandatorily redeemable upon the maturity or
earlier redemption or repurchase of the Series A Junior Subordinated Debentures.
See "Description of the Series A Preferred Securities -- Mandatory Redemption."
In addition, upon the occurrence of certain special events arising from a
change in law or a change in legal interpretation or other specified
circumstances, the Series A Preferred Securities are redeemable in whole at the
Redemption Price at the option of Transamerica, in its capacity as the General
Partner, or the General Partner may dissolve Transamerica Delaware and cause to
be distributed to the holders of the Series A Preferred Securities, on a pro
rata basis, the Series A Junior Subordinated Debentures in lieu of any cash
distribution. If the Series A Junior Subordinated Debentures are distributed to
the holders of the Series A Preferred Securities, Transamerica will use its best
efforts to have the Series A Junior Subordinated Debentures listed on the New
York Stock Exchange or on such other exchange as the Series A Preferred
Securities are then listed. The obligations of Transamerica under the Series A
Junior Subordinated Debentures are subordinate and junior in right of payment to
Senior Indebtedness (as defined in the accompanying Prospectus) of Transamerica.
At , 1994, Senior Indebtedness of Transamerica (on an unconsolidated
basis) aggregated approximately $ million. Because Transamerica is a holding
company, the Series A Junior Subordinated Debentures are also effectively
subordinated to all existing and future liabilities, including trade payables,
of Transamerica's subsidiaries, except to the extent that Transamerica is a
creditor of the subsidiaries recognized as such. See "Description of the Series
A Preferred Securities -- Special Event Redemption or Distribution" and
"Description of the Series A Junior Subordinated Debentures".
S-2
<PAGE> 36
In the event of the dissolution of Transamerica Delaware, the holders of
the Series A Preferred Securities will be entitled to receive for each Series A
Preferred Security a liquidation preference of $25 plus accrued and unpaid
dividends thereon to the date of payment, subject to certain limitations,
unless, in connection with such dissolution, Series A Junior Subordinated
Debentures are distributed to the holders of the Series A Preferred Securities.
See "Description of the Series A Preferred Securities -- Liquidation
Distribution Upon Dissolution".
Application has been made to list the Series A Preferred Securities on the
New York Stock Exchange. See "Underwriting."
Prospective purchasers are urged to read the accompanying Prospectus for
certain additional material information regarding the Series A Preferred
Securities, the Series A Junior Subordinated Debentures and the Guarantee.
S-3
<PAGE> 37
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES
OFFERED HEREBY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE, IN THE
OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
------------------------
FOR NORTH CAROLINA PURCHASERS: THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE COMMISSIONER OF INSURANCE FOR THE STATE OF NORTH CAROLINA,
NOR HAS THE COMMISSIONER OF INSURANCE RULED UPON THE ACCURACY OR ADEQUACY OF
THIS DOCUMENT.
------------------------
S-4
<PAGE> 38
TRANSAMERICA DELAWARE
Transamerica Delaware is a limited partnership that was formed under the
Delaware Revised Uniform Limited Partnership Act (the "Partnership Act") on
August 9, 1994. The initial partners in Transamerica Delaware are Transamerica,
as general partner, and Transamerica LP Holdings Corp., a Delaware corporation
and a wholly-owned subsidiary of Transamerica ("Transamerica Holdings"), as
limited partner. Upon the issuance of the Series A Preferred Securities, which
securities represent limited partner interests in Transamerica Delaware,
Transamerica Holdings will remain as a limited partner, but will have no
interest in the profits and dividends or in the assets of Transamerica Delaware.
The General Partner will agree to contribute capital to the extent required to
maintain its capital at an amount equal to at least 3% of the total capital
contributions to Transamerica Delaware. Transamerica and Transamerica Holdings
entered into an agreement of limited partnership dated as of August 9, 1994.
Such agreement of limited partnership will be amended and restated in its
entirety (as so amended and restated, the "Limited Partnership Agreement"),
substantially in the form filed as an exhibit to the Registration Statement of
which this Prospectus Supplement and the accompanying Prospectus form a part.
Transamerica Delaware is managed by the General Partner and exists for the
sole purpose of issuing its partnership interests and investing the proceeds
thereof in junior subordinated debentures of Transamerica ("Junior Subordinated
Debentures"). The rights of the holders of the Series A Preferred Securities,
including economic rights, rights to information and voting rights, are set
forth in the Limited Partnership Agreement (including the action of the General
Partner specifying the terms of the Series A Preferred Securities (the "Action")
taken in accordance with the Limited Partnership Agreement) and the Partnership
Act. See "Description of the Series A Preferred Securities".
The business address of Transamerica Delaware is c/o Transamerica
Corporation, 600 Montgomery Street, San Francisco, California 94111, telephone
number (415) 983-4000.
TRANSAMERICA CORPORATION
Transamerica Corporation is a diversified financial services company, whose
core businesses include consumer lending, commercial lending, leasing, real
estate services, life insurance and asset management. Transamerica was
incorporated in Delaware in 1928. At June 30, 1994, Transamerica had
consolidated assets of $39.0 billion and total shareholders' equity of $3.1
billion. For the year ended December 31, 1993, Transamerica had revenues of $4.8
billion and net income of $377 million.
Because Transamerica is a holding company, the Series A Junior Subordinated
Debentures are effectively subordinated to all existing and future liabilities,
including trade payables, of Transamerica's subsidiaries, except to the extent
that Transamerica is a creditor of the subsidiaries recognized as such.
The principal executive offices of Transamerica are located at 600
Montgomery Street, San Francisco, California 94111. Transamerica's telephone
number is (415) 983-4000.
S-5
<PAGE> 39
INVESTMENT CONSIDERATIONS
Prospective purchasers of Series A Preferred Securities should review
carefully the information contained elsewhere in this Prospectus Supplement and
in the accompanying Prospectus and should consider particularly the following
matters:
SUBORDINATION OF GUARANTEE AND SERIES A JUNIOR SUBORDINATED DEBENTURES;
DEPENDENCE ON TRANSAMERICA. Transamerica's obligations under the Guarantee are
subordinate and junior in right of payment to all other liabilities of
Transamerica except those made pari passu (that is, equal in priority) by their
terms. The obligations of Transamerica under the Series A Junior Subordinated
Debentures described under "Description of the Series A Junior Subordinated
Debentures" are subordinate and junior in right of payment to Senior
Indebtedness of Transamerica. At August 31, 1994, Senior Indebtedness of
Transamerica (on an unconsolidated basis) aggregated approximately $730 million.
Because Transamerica is a holding company, the Series A Junior Subordinated
Debentures are also effectively subordinated to all existing and future
liabilities, including trade payables, of Transamerica's subsidiaries, except to
the extent that Transamerica is a creditor of the subsidiaries recognized as
such. At June 30, 1994, Transamerica's subsidiaries had outstanding $8.0 billion
of indebtedness, $23.4 billion of life insurance policy liabilities and
approximately $3.7 billion of other liabilities. There are no terms in the
Series A Preferred Securities, the Series A Junior Subordinated Debentures or
the Guarantee that limit Transamerica's ability to incur additional
indebtedness, including indebtedness that ranks senior to the Series A Junior
Subordinated Debentures and the Guarantee or the ability of its subsidiaries to
incur additional indebtedness. See "Description of the Guarantee -- Status of
the Guarantee" and "Description of the Junior Subordinated
Debentures -- Subordination" in the accompanying Prospectus.
Transamerica Delaware's ability to pay dividends on the Series A Preferred
Securities is solely dependent upon Transamerica making interest payments on the
Series A Junior Subordinated Debentures as and when required. In the event that
Transamerica were for any reason to be unable to make payments on the Series A
Junior Subordinated Debentures as and when required, there is a substantial
likelihood that Transamerica, in its capacity as Guarantor, would be unable to
make payments on the Guarantee as and when required. Transamerica's obligations
under the Guarantee are unsecured and, on a liquidation or winding up of
Transamerica, its obligations under the Guarantee will rank junior to all of its
other liabilities except those made pari passu by their terms.
OPTION TO EXTEND INTEREST PAYMENT PERIOD; TAX IMPACT OF
EXTENSION. Transamerica has the right under the Indenture (as defined herein)
to extend the interest payment period from time to time on the Series A Junior
Subordinated Debentures to a period not exceeding 60 consecutive months (an
"Extension Period"), and, as a consequence, monthly dividends on the Series A
Preferred Securities would be deferred (but would continue to accrue with
interest thereon) by Transamerica Delaware during any such Extension Period. In
the event that Transamerica exercises this right, Transamerica may not during
such Extension Period declare or pay dividends on, or purchase or acquire, any
of its common stock. Prior to the termination of any such Extension Period,
Transamerica may further extend such Extension Period, provided that such
Extension Period together with all such previous and further extensions thereof
may not exceed 60 consecutive months. Upon the termination of any Extension
Period and the payment of all amounts then due, Transamerica may select a new
Extension Period, subject to the above requirements. The entire principal amount
of the Series A Junior Subordinated Debentures will become due and payable,
together with any accrued and unpaid interest thereon, including Additional
Interest (as hereinafter defined), if any, on , 2024. See
"Description of the Series A Preferred Securities -- Dividends" and "Description
of the Series A Junior Subordinated Debentures -- Option to Extend Interest
Payment Period".
Should an Extension Period occur, Transamerica Delaware will continue to
accrue income for United States federal income tax purposes which will be
allocated, but not distributed by way of cash dividends, to holders of record of
Series A Preferred Securities. As a result, such a holder will
S-6
<PAGE> 40
include such interest in such holder's gross income for United States federal
income tax purposes in advance of the receipt of cash, and will not receive the
cash from Transamerica Delaware related to such income if such a holder disposes
of his or her Series A Preferred Securities prior to the record date for payment
of dividends. See "United States Taxation -- Potential Extension of Interest
Payment Period".
SPECIAL EVENT REDEMPTION OR DISTRIBUTION. Upon the occurrence of a Special
Event (as hereinafter defined), which may occur at any time, the General Partner
shall elect to either (i) redeem the Series A Preferred Securities in whole or
(ii) dissolve Transamerica Delaware and cause the Series A Junior Subordinated
Debentures to be distributed to the holders of the Series A Preferred Securities
in connection with the liquidation of Transamerica Delaware. In the case of a
Special Event which is a Tax Event (as hereinafter defined), however, the
General Partner may, as an alternative to electing to redeem the Series A
Preferred Securities or dissolving Transamerica Delaware, elect to cause the
Series A Preferred Securities to remain outstanding. There can be no assurance
as to the market prices for the Series A Preferred Securities or the Series A
Junior Subordinated Debentures which may be distributed in exchange for Series A
Preferred Securities were a dissolution and liquidation of Transamerica Delaware
to occur. Accordingly, the Series A Preferred Securities which an investor may
purchase, or the Series A Junior Subordinated Debentures which the investor may
receive, may trade at a discount to the price which the investor paid to
purchase the Series A Preferred Securities offered hereby. See "Description of
the Series A Preferred Securities -- Special Event Redemption or Distribution"
and "Description of the Series A Junior Subordinated Debentures -- General".
Under current United States federal income tax law and interpretation, a
distribution of the Series A Junior Subordinated Debentures upon a Special Event
would not be a taxable event to holders of the Series A Preferred Securities.
Under a change in law, a change in legal interpretation or the other
circumstances giving rise to a Special Event, however, the dissolution could be
a taxable event to holders of the Series A Preferred Securities. See "United
States Taxation -- Receipt of Series A Junior Subordinated Debentures Upon
Liquidation of Transamerica Delaware".
S-7
<PAGE> 41
SUMMARY CONSOLIDATED FINANCIAL DATA
This summary is qualified in its entirety by the detailed information and
financial statements included in the documents incorporated by reference herein,
including that for interim periods. The information furnished for the six months
ended June 30, 1994 and 1993 reflects all adjustments and accruals which are, in
the opinion of the management of Transamerica, necessary for a fair statement of
the results for such periods. The results of operations in the interim
statements are not necessarily indicative of the results that may be expected
for the full year. See "Incorporation of Certain Documents by Reference" in the
accompanying Prospectus.
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
YEARS ENDED DECEMBER 31, JUNE 30,
--------------------------------------------------------- ---------------------
1989 1990 1991 1992 1993 1993 1994
--------- --------- --------- --------- --------- --------- ---------
(IN MILLIONS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues.............................. $ 4,476.1 $ 4,097.7 $ 4,175.2 $ 4,550.9 $ 4,813.3 $ 2,362.5 $ 2,598.4
Net income:
Income from continuing operations... 251.3 190.5 5.7 334.0 447.5 210.3 209.4
Income (loss) from discontinued
operations........................ 80.9 75.8 79.1 (90.8) (47.0) 5.4 (0.7)
Extraordinary loss on early
extinguishment of debt............ (23.1)
Cumulative effect of change in
accounting for post employment
benefits other than pensions...... (34.7)
--------- --------- --------- --------- --------- --------- ---------
Net income............................ $ 332.2 $ 266.3 $ 50.1 $ 243.2 $ 377.4 $ 215.7 $ 208.7
========= ========= ========= ========= ========= ========= =========
Earnings per common share
Net Income:
Income from continuing
operations...................... $ 3.11 $ 2.30 $ (0.08) $ 4.00 $ 5.40 $ 2.50 $ 2.63
Income (loss) from discontinued
operations...................... 1.07 0.99 1.03 (1.17) (0.60) 0.07 (0.01)
Extraordinary loss on early
extinguishment of debt.......... (0.29)
Cumulative effect of change in
accounting for post employment
benefits other than pensions.... (0.45)
--------- --------- --------- --------- --------- --------- ---------
Net income.......................... $ 4.18 $ 3.29 $ 0.50 $ 2.83 $ 4.51 $ 2.57 $ 2.62
========= ========= ========= ========= ========= ========= =========
Average number of common shares
outstanding......................... 75.5 76.2 76.7 78.1 78.5 79.3 75.0
Balance sheet data (at period end):
Total assets.......................... $27,357.1 $29,260.9 $31,133.6 $33,290.9 $36,050.5 $35,101.6 $38,956.5
Notes and loans payable:
Short-term and current portion of
long-term debt.................... 1,038.2 869.1 715.4 1,062.6 2,023.0 1,277.6 1,647.0
Long-term debt...................... 6,897.2 6,602.5 6,975.6 6,510.5 5,681.0 6,293.1 7,111.3
Shareholders' equity(1)............... 2,928.7 3,016.7 3,025.8 3,300.1 3,363.5 3,415.9 3,106.1
Book value per common share........... $ 35.63 $ 36.56 $ 36.28 $ 36.31 $ 38.46 $ 38.02 $ 38.09
</TABLE>
- ---------------
(1) In the first quarter of 1994 Transamerica adopted Statement of Financial
Accounting Standards No. 115, Accounting for Certain Investments in Debt
and Equity Securities, which resulted in all of Transamerica's investments
in debt securities being reported at fair value. As of June 30, 1994 the
net unrealized gain from investments marked to fair value included in
shareholders' equity has been reduced by $14.9 million as a result of
adopting this new accounting standard. There is no effect on the income
statement from the adoption of this new accounting standard, and prior
periods have not been restated.
S-8
<PAGE> 42
CAPITALIZATION OF TRANSAMERICA
The following table sets forth the consolidated short-term obligations and
capitalization of Transamerica as of June 30, 1994, and as adjusted to reflect
the application of the estimated net proceeds from the sale of the Series A
Preferred Securities. See "Use of Proceeds".
<TABLE>
<CAPTION>
JUNE 30, 1994
-------------------------
ACTUAL AS ADJUSTED
--------- -----------
(IN MILLIONS)
<S> <C> <C>
Short-term obligations, including current maturities............... $ 1,647.0 $
Long-term debt (1)................................................. 7,111.3
Life insurance policy liabilities.................................. 23,410.3
Other liabilities.................................................. 3,681.9
Minority interest in equity of subsidiaries........................
Shareholders' equity:
Preferred stock, par value $100 per share; 1,200,000 shares
authorized;
8.50% Preferred Stock, Series D ($500 liquidation preference)
400,000 shares issued....................................... 200.0
Dutch Auction Rate Transferable Securities
Preferred Stock ("DARTS"), Series A-1
750 shares issued........................................... 75.0
DARTS, Series B-1
750 shares issued........................................... 75.0
DARTS, Series C-1
750 shares issued........................................... 75.0
Common stock, par value $1.00 per share; 150,000,000 shares
authorized; 70,393,675 shares outstanding, after deducting
9,344,787 shares in treasury.................................. 70.4
Additional paid-in capital....................................... 152.1
Retained earnings................................................ 2,421.8
Net unrealized gain from investments marked to fair value........ 72.7
Foreign currency translation adjustments......................... (35.9)
--------- ----------
Total shareholders' equity............................... 3,106.1
--------- ----------
Total capitalization (excluding life insurance policy
liabilities, other liabilities and short-term
obligations)........................................... $10,217.4 $
========= ==========
</TABLE>
- ---------------
(1) Senior Indebtedness of Transamerica, for purposes of the subordination
provisions of the Series A Junior Subordinated Debentures, includes only
indebtedness of Transamerica on an unconsolidated basis. As of August 31,
1994, such Senior Indebtedness aggregated approximately $730 million.
Because Transamerica is a holding company, the Series A Junior Subordinated
Debentures are also effectively subordinated to all other long-term debt
and short-term obligations set forth in the above table, as well as other
liabilities of Transamerica's subsidiaries.
USE OF PROCEEDS
The proceeds from the sale of the Series A Preferred Securities will be
invested in the Series A Junior Subordinated Debentures issued pursuant to the
Indenture described herein, and ultimately will be used by Transamerica for
general corporate purposes, which may include the repayment or repurchase of its
securities.
S-9
<PAGE> 43
DESCRIPTION OF THE SERIES A PREFERRED SECURITIES
GENERAL
All of the partnership interests in Transamerica Delaware, are owned
directly or indirectly by Transamerica. The Limited Partnership Agreement
(including the Action) authorizes and creates the Series A Preferred Securities,
which represent limited partner interests in Transamerica Delaware ("Preferred
Securities"). Other Preferred Securities may be issued from time to time in one
or more series as described in the accompanying Prospectus. The limited partner
interests represented by the Series A Preferred Securities will have a
preference with respect to dividends and amounts payable on redemption or
liquidation over the General Partner's interest in Transamerica Delaware. The
Limited Partnership Agreement does not permit the issuance of any Preferred
Securities ranking, as to participation in profits and dividends and in the
assets of Transamerica Delaware, senior or junior to the Series A Preferred
Securities or the incurrence of any indebtedness by Transamerica Delaware. The
summary of certain material terms and provisions of the Series A Preferred
Securities set forth below does not purport to be complete and is subject to,
and qualified in its entirety by reference to, the Limited Partnership Agreement
(including the Action) which has been filed as an exhibit to the Registration
Statement of which this Prospectus Supplement forms a part, and the Partnership
Act.
DIVIDENDS
Dividends on the Series A Preferred Securities will be cumulative, will
accrue from the date of initial issuance and will be payable monthly in arrears,
on the last day of each calendar month of each year, commencing ,
1994, when, as and if determined to be so payable by Transamerica, in its
capacity as General Partner, except as otherwise described below. Dividends in
arrears for more than one month will bear interest monthly at the rate per annum
equal to the dividend rate for each month during the period of arrearage. The
term "dividends" as used herein includes any such interest payable unless
otherwise stated. The amount of dividends payable for any period will be
computed on the basis of a 360-day year of twelve 30-day months.
The dividend rate will be adjusted quarterly. The rate for the initial
period from the date of initial issuance to , 1994 will be %
per annum, which is equivalent to $ per Series A Preferred Security per
annum. Thereafter, dividends on the Series A Preferred Securities will be
payable at the "Applicable Rate" (as defined below) from time to time in effect.
Transamerica has the right under the Indenture (as hereinafter defined) to
extend the interest payment period from time to time on the Series A Junior
Subordinated Debentures to a period not exceeding 60 consecutive months and, as
a consequence, monthly dividends on the Series A Preferred Securities would be
deferred (but would continue to accrue with interest thereon) by Transamerica
Delaware during any such Extension Period. In the event that Transamerica
exercises this right, Transamerica may not declare or pay dividends on, or
purchase or acquire, any of its common stock during such Extension Period. Prior
to the termination of any such Extension Period, Transamerica may further extend
such Extension Period, provided that such Extension Period together with all
such previous and further extensions thereof may not exceed 60 consecutive
months. Upon the termination of any Extension Period and the payment of all
amounts then due, Transamerica may select a new Extension Period, subject to the
above requirements. See "Description of the Series A Junior Subordinated
Debentures -- Interest" and "-- Option to Extend Interest Payment Period".
It is anticipated that Transamerica Delaware's earnings available for
distribution to the holders of the Series A Preferred Securities will be limited
to payments under the Series A Junior Subordinated Debentures in which
Transamerica Delaware will invest the proceeds from the issuance and sale of the
Series A Preferred Securities and the General Partnership Payment (as
hereinafter defined). See "Description of the Series A Junior Subordinated
Debentures". If Transamerica does not make interest payments on the Series A
Junior Subordinated Debentures, it is expected that Transamerica Delaware will
not declare or pay dividends on the Series A Preferred Securities. The payment
of dividends (if and to the extent declared) is guaranteed by Transamerica
S-10
<PAGE> 44
as and to the extent set forth under "Description of the Guarantee" in the
accompanying Prospectus. The Guarantee is a full and unconditional guarantee
from the time of issuance of the Series A Preferred Securities, but does not
apply to any payment of dividends unless and until such dividends are declared.
Dividends on the Series A Preferred Securities will be payable to the
holders thereof as they appear on the books and records of Transamerica Delaware
on the relevant record dates, which, as long as the Series A Preferred
Securities remain in book-entry-only form, will be one Business Day (as
hereinafter defined) prior to the relevant payment dates. Subject to any
applicable laws and regulations and the provisions of the Limited Partnership
Agreement, each such payment will be made as described under "Book-Entry-Only
Issuance -- The Depository Trust Company" below. In the event the Series A
Preferred Securities shall not continue to remain in book-entry-only form, the
General Partner shall have the right to select relevant record dates, which
shall be more than one Business Day prior to the relevant payment dates. In the
event that any date on which dividends are payable on the Series A Preferred
Securities is not a Business Day, then payment of the dividend payable on such
date will be made on the next succeeding day that is a Business Day (and without
any interest or other payment in respect of any such delay) except that, if such
Business Day is in the next succeeding calendar year, such payment shall be made
on the immediately preceding Business Day, in each case with the same force and
effect as if made on such date. A "Business Day" shall mean any day other than a
day on which banking institutions in The City of New York are authorized or
required by law to close.
Except as provided below in this paragraph, the "Applicable Rate" for any
quarter (other than the initial period) will be equal to % of the Effective
Rate (as defined below), but not less than % per annum nor more than %
per annum. The "Effective Rate" for any quarter will be equal to the highest of
the Treasury Bill Rate, the Ten Year Constant Maturity Rate and the Thirty Year
Constant Maturity Rate (each as defined below) for such quarter. The Applicable
Rate will be rounded to the nearest five hundredth of a percent. In the event
that Transamerica Delaware determines in good faith that for any reason:
(i) any one of the Treasury Bill Rate, the Ten Year Constant Maturity
Rate or the Thirty Year Constant Maturity Rate cannot be determined for any
quarter, then the Effective Rate for such quarter will be equal to the
higher of whichever two of such rates can be so determined;
(ii) only one of the Treasury Bill Rate, the Ten Year Constant
Maturity Rate and the Thirty Year Constant Maturity Rate can be determined
for any quarter, then the Effective Rate for such quarter will be equal to
whichever such rate can be so determined; or
(iii) none of the Treasury Bill Rate, the Ten Year Constant Maturity
Rate and the Thirty Year Constant Maturity Rate can be determined for any
quarter, then the Effective Rate for the preceding quarter will be
continued for such quarter.
Except as described below in this paragraph, the "Treasury Bill Rate" for
each quarter will be the arithmetic average of the two most recent weekly per
annum secondary market discount rates (or the one weekly per annum secondary
market discount rate, if only one such rate is published during the relevant
Calendar Period (as defined below)) for three-month U.S. Treasury bills, as
published weekly by the Federal Reserve Board (as defined below) during the
Calendar Period immediately preceding the last ten calendar days preceding the
quarter for which the dividend rate on the Series A Preferred Securities is
being determined. In the event that the Federal Reserve Board does not publish
such a weekly per annum secondary market discount rate during any such Calendar
Period, then the Treasury Bill Rate for such quarter will be the arithmetic
average of the two most recent weekly per annum secondary market discount rates
(or the one weekly per annum secondary market discount rate, if only one such
rate is published during the relevant Calendar Period) for three-month U.S.
Treasury bills, as published weekly during such Calendar Period by any Federal
Reserve Bank or by any U.S. Government department or agency selected by
Transamerica Delaware. In the event that a per annum secondary market discount
rate for three-month
S-11
<PAGE> 45
U.S. Treasury bills is not published by the Federal Reserve Board or by any
Federal Reserve Bank or by any U.S. Government department or agency during such
Calendar Period, then the Treasury Bill Rate for such quarter will be the
arithmetic average of the two most recent weekly per annum secondary market
discount rates (or the one weekly per annum secondary market discount rate, if
only one such rate is published during the relevant Calendar Period) for all of
the U.S. Treasury bills then having remaining maturities of not less than 80 nor
more than 100 days, as published during such Calendar Period by the Federal
Reserve Board, or if the Federal Reserve Board does not publish such rates, by
any Federal Reserve Bank or by any U.S. Government department or agency selected
by Transamerica Delaware. In the event that Transamerica Delaware determines in
good faith that for any reason no such U.S. Treasury bill rates are published as
provided above during such Calendar Period, then the Treasury Bill Rate for such
quarter will be the arithmetic average of the per annum secondary market
discount rates based upon the closing bids during such Calendar Period for each
of the issues of marketable non-interest-bearing U.S. Treasury securities with a
remaining maturity of not less than 80 nor more than 100 days from the date of
each such quotation, as chosen and quoted daily for each Business Day in New
York City (or less frequently if daily quotations are not generally available)
to Transamerica Delaware by at least three recognized dealers in U.S. Government
securities selected by Transamerica Delaware. In the event that Transamerica
Delaware determines in good faith that for any reason Transamerica Delaware
cannot determine the Treasury Bill Rate for any quarter as provided above in
this paragraph, the Treasury Bill Rate for such quarter will be the arithmetic
average of the per annum secondary market discount rate based upon the closing
bids during such Calendar Period for each of the issues of marketable
interest-bearing U.S. Treasury securities with a remaining maturity of not less
than 80 nor more than 100 days, as chosen and quoted daily for each business day
in New York City (or less frequently if daily quotations are not generally
available) to Transamerica Delaware by at least three recognized dealers in U.S.
Government securities selected by Transamerica Delaware.
Except as described below in this paragraph, the "Ten Year Constant
Maturity Rate" for each quarter will be the arithmetic average of the two most
recent weekly per annum Ten Year Average Yields (as defined below) (or the one
weekly per annum Ten Year Average Yield, if only one such yield is published
during the relevant Calendar Period), as published weekly by the Federal Reserve
Board during the Calendar Period immediately preceding the last ten calendar
days preceding the quarter for which the dividend rate on the Series A Preferred
Securities is being determined. In the event that the Federal Reserve Board does
not publish such a weekly per annum Ten Year Average Yield during such Calendar
Period, then the Ten Year Constant Maturity Rate for such quarter will be the
arithmetic average of the two most recent weekly per annum Ten Year Average
Yields (or the one weekly per annum Ten Year Average Yield, if only one such
yield is published during the relevant Calendar Period), as published weekly
during such Calendar Period by any Federal Reserve Bank or by any U.S.
Government department or agency selected by Transamerica Delaware. In the event
that a per annum Ten Year Average Yield is not published by the Federal Reserve
Board or by any Federal Reserve Bank or by any U.S. Government department or
agency during such Calendar Period, then the Ten Year Constant Maturity Rate for
such quarter will be the arithmetic average of the two most recent weekly per
annum average yields to maturity (or the one weekly per annum average yield to
maturity, if only one such yield is published during the relevant Calendar
Period) for all of the actively traded marketable U.S. Treasury fixed interest
rate securities (other than Special Securities (as defined below)) then having
remaining maturities of not less than eight nor more than twelve years, as
published during such Calendar Period by the Federal Reserve Board or, if the
Federal Reserve Board does not publish such yields, by any Federal Reserve Bank
or by any U.S. Government department or agency selected by Transamerica
Delaware. In the event that Transamerica Delaware determines in good faith that
for any reason Transamerica Delaware cannot determine the Ten Year Constant
Maturity Rate for any quarter as provided above in this paragraph, then the Ten
Year Constant Maturity Rate for such quarter will be the arithmetic average of
the per annum average yields to maturity based upon the closing bids during such
Calendar Period for each of the issues of actively traded marketable U.S.
Treasury fixed interest rate
S-12
<PAGE> 46
securities (other than Special Securities) with a final maturity date not less
than eight or more than twelve years from the date of each such quotation, as
chosen and quoted daily for each Business Day in New York City (or less
frequently if daily quotations are not generally available) to Transamerica
Delaware by at least three recognized dealers in U.S. Government securities
selected by Transamerica Delaware.
Except as described below in this paragraph, the "Thirty Year Constant
Maturity Rate" for each quarter will be the arithmetic average of the two most
recent weekly per annum Thirty Year Average Yields (as defined below) (or the
one weekly per annum Thirty Year Average Yield, if only one such yield is
published during the relevant Calendar Period), as published weekly by the
Federal Reserve Board during the Calendar Period immediately preceding the last
ten calendar days preceding the quarter for which the dividend rate on the
Series A Preferred Securities is being determined. In the event that the Federal
Reserve Board does not publish such a weekly per annum Thirty Year Average Yield
during such Calendar Period, then the Thirty Year Constant Maturity Rate for
such quarter will be the arithmetic average of the two most recent weekly per
annum Thirty Year Average Yields (or the one weekly per annum Thirty Year
Average Yield, if only one such yield is published during the relevant Calendar
Period), as published weekly during such Calendar Period by any Federal Reserve
Bank or by any U.S. Government department or agency selected by Transamerica
Delaware. In the event that a per annum Thirty Year Average Yield is not
published by the Federal Reserve Board or by any Federal Reserve Bank or by any
U.S. Government department or agency during such Calendar Period, then the
Thirty Year Constant Maturity Rate for such quarter will be the arithmetic
average of the two most recent weekly per annum average yields to maturity (or
the one weekly per annum average yield to maturity, if only one such yield is
published during the relevant Calendar Period) for all of the actively traded
marketable U.S. Treasury fixed interest rate securities (other than Special
Securities) then having remaining maturities of not less than twenty-eight nor
more than thirty-two years, as published during such Calendar Period by the
Federal Reserve Board or, if the Federal Reserve Board does not publish such
yields, by any Federal Reserve Bank or by any U.S. Government department or
agency selected by Transamerica Delaware. In the event that Transamerica
Delaware determines in good faith that for any reason Transamerica Delaware
cannot determine the Thirty Year Constant Maturity Rate for any quarter as
provided above in this paragraph, then the Thirty Year Constant Maturity Rate
for such quarter will be the arithmetic average of the per annum average yields
to maturity based upon the closing bids during such Calendar Period for each of
the issues of actively traded marketable U.S. Treasury fixed interest rate
securities (other than Special Securities) with a final maturity date not less
than twenty-eight nor more than thirty-two years from the date of each such
quotation, as chosen and quoted daily for each Business Day in New York City (or
less frequently if daily quotations are not generally available) to Transamerica
Delaware by at least three recognized dealers in U.S. Government securities
selected by Transamerica Delaware.
The Treasury Bill Rate, the Ten Year Constant Maturity Rate and the Thirty
Year Constant Maturity Rate will each be rounded to the nearest one hundredth of
a percent.
The Applicable Rate with respect to each quarter (other than the initial
period) will be calculated as promptly as practicable by Transamerica Delaware
according to the appropriate method described above. Transamerica Delaware will
cause each Applicable Rate to be published in a newspaper of general circulation
in New York City before the commencement of the quarter to which it applies and
will cause notice of such Applicable Rate to be given to The Depository Trust
Company (the "Depository" or "DTC"), New York, New York, the securities
depository for the Series A Preferred Securities. See "Book-Entry-Only
Issuance -- The Depository Trust Company" below.
As used above, the term "Calendar Period" means a period of fourteen
calendar days; the term "Federal Reserve Board" means the Board of Governors of
the Federal Reserve System; the term "Special Securities" means securities which
can, at the option of the holder, be surrendered at face value in payment of any
federal estate tax or which provide tax benefits to the holder and are priced
S-13
<PAGE> 47
to reflect such tax benefits or which were originally issued at a deep or
substantial discount; the term "Ten Year Average Yield" means the average yield
to maturity for actively traded marketable U.S. Treasury fixed interest rate
securities adjusted to constant maturities of ten years; and the term "Thirty
Year Average Yield" means the average yield to maturity for actively traded
marketable U.S. Treasury fixed interest rate securities adjusted to constant
maturities of thirty years.
CERTAIN RESTRICTIONS ON TRANSAMERICA DELAWARE
If dividends have not been paid in full on the Series A Preferred
Securities, Transamerica Delaware shall not:
(i) declare, pay, or set aside for payment, any dividends on any other
series of Preferred Securities, unless the amounts of any dividends
declared and paid on any other series of Preferred Securities and on the
Series A Preferred Securities are on a pro rata basis on the dates such
dividends are paid on such other series of Preferred Securities, so that
(x) the aggregate amount of dividends paid on the Series A
Preferred Securities bears to the aggregate amount of dividends paid on
such other series of Preferred Securities the same ratio as
(y) the aggregate of all accrued and unpaid dividends in respect of
the Series A Preferred Securities bears to the aggregate of all accrued
and unpaid dividends in respect of such other series of Preferred
Securities; or
(ii) redeem, purchase or otherwise acquire any other Preferred
Securities;
until, in each case, such time as all accrued and unpaid dividends on the Series
A Preferred Securities shall have been paid in full for all dividend periods
terminating on or prior to, in the case of clause (i), such payment and, in the
case of clause (ii), the date of such redemption, purchase or acquisition.
As of the date of this Prospectus Supplement, there are no series of
Preferred Securities outstanding.
OPTIONAL REDEMPTION
The Series A Preferred Securities are redeemable, at the option of
Transamerica Delaware, in whole or in part, from time to time, on or after
, 1999, upon not less than 30 nor more than 60 days' notice, at the
Redemption Price. If Transamerica Delaware redeems Series A Preferred Securities
in accordance with the terms thereof, the Series A Junior Subordinated
Debentures will become due and payable in a principal amount equal to the
aggregate stated liquidation preference of the Series A Preferred Securities so
redeemed, together with any accrued and unpaid interest on such principal amount
of Series A Junior Subordinated Debentures. See "Description of Series A Junior
Subordinated Debentures -- Mandatory Prepayment". In the event that fewer than
all the outstanding Series A Preferred Securities are to be so redeemed, the
Series A Preferred Securities to be redeemed will be selected as described under
"Book-Entry-Only Issuance -- The Depository Trust Company" below. If a partial
redemption would result in the delisting of the Series A Preferred Securities,
Transamerica Delaware may only redeem the Series A Preferred Securities in
whole.
SPECIAL EVENT REDEMPTION OR DISTRIBUTION
If a Tax Event or an Investment Company Event (each as hereinafter defined,
and each a "Special Event") shall occur and be continuing, the General Partner
shall elect to either (i) redeem the Series A Preferred Securities in whole (and
not in part), upon not less than 30 or more than 60 days' notice at the
Redemption Price, within 90 days following the occurrence of such Special Event;
provided that, if and as long as at the time there is available to the General
Partner the opportunity to eliminate, within such 90-day period, the Special
Event by taking some ministerial
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action, such as filing a form or making an election, or pursuing some other
similar reasonable such measure that has no adverse effect on Transamerica
Delaware or Transamerica, the General Partner will pursue such measure in lieu
of redemption, or (ii) dissolve Transamerica Delaware and, after satisfaction of
creditors as required by the Partnership Act, cause Series A Junior Subordinated
Debentures to be distributed to the holders of the Series A Preferred Securities
in liquidation of Transamerica Delaware, within 90 days following the occurrence
of such Special Event. In the case of a Tax Event, the General Partner may, as
an alternative to electing to redeem the Series A Preferred Securities or
dissolving Transamerica Delaware, elect to cause the Series A Preferred
Securities to remain outstanding.
"Tax Event" means that Transamerica shall have obtained an opinion of
nationally recognized independent tax counsel experienced in such matters to the
effect that on or after the date of this Prospectus Supplement, as a result of
(a) any amendment to, or change (including any announced prospective change) in,
the laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, (b) any amendment to, or
change in, an interpretation or application of any such laws or regulations by
any legislative body, court, governmental agency or regulatory authority
(including the enactment of any legislation and the publication of any judicial
decision or regulatory determination), (c) any interpretation or pronouncement
that provides for a position with respect to such laws or regulations that
differs from the theretofore generally accepted position or (d) any action taken
by any governmental agency or regulatory authority, which amendment or change is
enacted, promulgated, issued or effective or which interpretation or
pronouncement is issued or announced or which action is taken, in each case on
or after the date of this Prospectus Supplement, there is more than an
insubstantial risk that (i) Transamerica Delaware is subject to federal income
tax with respect to interest accrued or received on the Series A Junior
Subordinated Debentures, (ii) Transamerica Delaware is subject to more than a de
minimis amount of taxes, duties or other governmental charge, or (iii) interest
payable by Transamerica to Transamerica Delaware on the Series A Junior
Subordinated Debentures will not be deductible by Transamerica for federal
income tax purposes.
"Investment Company Event" means the occurrence of a change in law or
regulation or a change in interpretation or application of law or regulation by
any legislative body, court, governmental agency or regulatory authority (a
"Change in 1940 Act Law") to the effect that Transamerica Delaware is or will be
considered an "investment company" which is required to be registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), which Change in
1940 Act Law becomes effective on or after the date of this Prospectus
Supplement; provided that no Investment Company Event shall be deemed to have
occurred if the General Partner obtains a written opinion of nationally
recognized independent counsel to the Partnership experienced in practice under
the 1940 Act to the effect that the General Partner has successfully issued an
additional or supplemental irrevocable and unconditional guarantee or taken such
other steps as may be necessary so that, in the opinion of such counsel,
notwithstanding such Change in 1940 Act Law, Transamerica Delaware is not
required to be registered as an "investment company" within the meaning of the
1940 Act. In case of any uncertainty regarding an Investment Company Event, the
good faith determination of the General Partner (based on the advice of counsel)
shall be conclusive.
After the date fixed for any distribution of Series A Junior Subordinated
Debentures, upon dissolution of Transamerica Delaware, (i) the Series A
Preferred Securities will no longer be deemed to be outstanding, (ii) DTC or its
nominee, as the record holder of the Series A Preferred Securities, will receive
a registered global certificate or certificates representing the Series A Junior
Subordinated Debentures to be delivered upon such distribution and (iii) any
certificates representing Series A Preferred Securities not held by DTC or its
nominee will be deemed to represent Series A Junior Subordinated Debentures
having a principal amount equal to the stated liquidation preference of such
Series A Preferred Securities, and bearing accrued and unpaid interest in an
amount equal to the accrued and unpaid dividends on such Series A Preferred
Securities, until such certificates are presented to Transamerica or its agent
for transfer or reissuance.
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There can be no assurance as to the market prices for the Series A
Preferred Securities or the Series A Junior Subordinated Debentures which may be
distributed in exchange for Series A Preferred Securities were a dissolution and
liquidation of Transamerica Delaware to occur. Accordingly, the Series A
Preferred Securities which an investor may purchase, or the Series A Junior
Subordinated Debentures which the investor may receive, may trade at a discount
to the price which the investor paid to purchase the Series A Preferred
Securities offered hereby.
MANDATORY REDEMPTION
Upon the repayment of the Series A Junior Subordinated Debentures, whether
at maturity or upon redemption, repurchased or otherwise, the proceeds from such
repayment will be applied to redeem the Series A Preferred Securities, in whole,
upon not less than 30 nor more than 60 days' notice, at the Redemption Price.
REDEMPTION PROCEDURES
Transamerica Delaware may not redeem fewer than all the outstanding Series
A Preferred Securities unless all accrued and unpaid dividends have been paid on
all Series A Preferred Securities for all monthly dividend periods terminating
on or prior to the date of redemption.
If Transamerica Delaware gives a notice of redemption in respect of Series
A Preferred Securities (which notice will be irrevocable) then, by 12:00 noon,
New York City time, on the redemption date, Transamerica Delaware will deposit
irrevocably with DTC funds sufficient to pay the applicable Redemption Price and
will give DTC irrevocable instructions and authority to pay the Redemption Price
to the holders of the Series A Preferred Securities. See "Book-Entry-Only
Issuance -- The Depository Trust Company". If notice of redemption shall have
been given and funds deposited as required, then upon the date of such deposit,
all rights of holders of such Series A Preferred Securities so called for
redemption will cease, except the right of the holders of such Series A
Preferred Securities to receive the Redemption Price, but without interest on
such Redemption Price. In the event that any date fixed for redemption of Series
A Preferred Securities is not a Business Day, then payment of the Redemption
Price payable on such date will be made on the next succeeding day that is a
Business Day (and without any interest or other payment in respect of any such
delay) except that, if such Business Day falls in the next calendar year, such
payment will be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date fixed for redemption. In
the event that payment of the Redemption Price in respect of Series A Preferred
Securities is improperly withheld or refused and not paid either by Transamerica
Delaware or by Transamerica pursuant to the Guarantee described under
"Description of the Guarantee" in the accompanying Prospectus, dividends on such
Series A Preferred Securities will continue to accrue at the then applicable
rate, from the original redemption date to the date of payment, in which case
the actual payment date will be considered the date fixed for redemption for
purposes of calculating the Redemption Price.
Subject to the foregoing and applicable law (including, without limitation,
United States federal securities laws), Transamerica or any of its subsidiaries,
including Transamerica Delaware, may at any time and from time to time purchase
outstanding Series A Preferred Securities by tender, in the open market or by
private agreement. If Transamerica Delaware purchases and cancels any Series A
Preferred Securities, the Series A Junior Subordinated Debentures may be repaid
in a principal amount equal to the aggregate stated liquidation preference of
the Series A Preferred Securities so purchased, together with any accrued and
unpaid interest on such principal amount of Series A Junior Subordinated
Debentures. See "Description of Series A Junior Subordinated
Debentures -- Optional Prepayment".
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LIQUIDATION DISTRIBUTION UPON DISSOLUTION
In the event of any voluntary or involuntary dissolution, winding-up or
termination of Transamerica Delaware, the holders of the Series A Preferred
Securities at the time will be entitled to receive out of the assets of
Transamerica Delaware available for distribution to partners after satisfaction
of liabilities of creditors as required by the Partnership Act, before any
distribution of assets is made to the General Partner, but together with the
holders of every other series of Preferred Securities outstanding, an amount
equal to, in the case of holders of Series A Preferred Securities, the aggregate
of the stated liquidation preference of $25 per Series A Preferred Security plus
accrued and unpaid dividends thereon to the date of payment (such amount being
the "Liquidation Distribution"), unless, in connection with such dissolution,
winding-up or termination, Series A Junior Subordinated Debentures in an
aggregate principal amount equal to the stated liquidation preference of such
Series A Preferred Securities, and bearing accrued and unpaid interest in an
amount equal to the accrued and unpaid dividends on such Series A Preferred
Securities, shall be distributed on a pro rata basis to the holders of the
Series A Preferred Securities.
If, upon any such dissolution, the Liquidation Distribution can be paid
only in part because Transamerica Delaware has insufficient assets available to
pay in full the aggregate Liquidation Distribution and the aggregate maximum
liquidation distributions on any other series of Preferred Securities, then the
amounts payable directly by Transamerica Delaware on the Series A Preferred
Securities and on such other series of Preferred Securities shall be paid in
cash or in kind on a pro rata basis, so that
(x) the aggregate amount paid in respect of the Liquidation
Distribution bears to the aggregate amount paid as liquidation
distributions on the other series of Preferred Securities the same ratio as
(y) the aggregate Liquidation Distribution bears to the aggregate
maximum liquidation distributions on the other series of Preferred
Securities.
Pursuant to the Limited Partnership Agreement, Transamerica Delaware shall
be dissolved and its affairs shall be wound up: (i) on December 31, 2093, the
expiration of the term of Transamerica Delaware, (ii) upon the bankruptcy of the
General Partner, (iii) upon the assignment by the General Partner of its entire
interest in Transamerica Delaware when the assignee is not admitted to
Transamerica Delaware as a general partner of Transamerica Delaware in
accordance with the Limited Partnership Agreement, or the filing of a
certificate of dissolution or its equivalent with respect to the General
Partner, or the revocation of the General Partner's charter and the expiration
of 90 days after the date of notice to the General Partner of revocation without
a reinstatement of its charter, or if any other event occurs that causes the
General Partner to cease to be a general partner of Transamerica Delaware under
the Partnership Act, unless the business of Transamerica Delaware is continued
in accordance with the Partnership Act, (iv) in accordance with the provisions
of the Series A Preferred Securities, (v) upon the entry of a decree of judicial
dissolution or (vi) upon the written consent of all partners of Transamerica
Delaware.
MERGER, CONSOLIDATION OR AMALGAMATION OF TRANSAMERICA DELAWARE
Transamerica Delaware may not consolidate, amalgamate, merge with or into,
or be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to, any corporation or other body, except as
described below. Transamerica Delaware may, without the consent of the holders
of the Series A Preferred Securities, consolidate, amalgamate, merge with or
into, or be replaced by a limited partnership, limited liability company or
trust organized as such under the laws of any state of the United States of
America provided that (i) such successor entity either (x) expressly assumes all
of the obligations of Transamerica Delaware under the Series A Preferred
Securities or (y) substitutes for the Series A Preferred Securities other
securities having substantially the same terms as the Series A Preferred
Securities (the "Successor Securities") so long as the Successor Securities
rank, with respect to participation in the profits and dividends, and
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in the assets, of the successor entity, at least as high as the Series A
Preferred Securities rank with respect to participation in the profits and
dividends, and in the assets, of Transamerica Delaware, (ii) Transamerica
expressly acknowledges such successor entity as the holder of the Series A
Junior Subordinated Debentures, (iii) the Series A Preferred Securities or any
Successor Securities are listed, or any Successor Securities will be listed upon
notification of issuance, on any national securities exchange or other
organization on which the Series A Preferred Securities are then listed, (iv)
such merger, consolidation, amalgamation or replacement does not cause the
Series A Preferred Securities (including any Successor Securities) to be
downgraded by any nationally recognized statistical rating organization, (v)
such merger, consolidation, amalgamation or replacement does not adversely
affect the powers, preferences and other special rights of the holders of the
Series A Preferred Securities (including any Successor Securities) in any
material respect (other than with respect to any dilution of the holders'
interest in the new entity), (vi) such successor entity has a purpose
substantially identical to that of Transamerica Delaware, (vii) prior to such
merger, consolidation, amalgamation or replacement, Transamerica has received an
opinion of nationally recognized independent counsel to Transamerica Delaware
experienced in such matters to the effect that (x) such successor entity will be
treated as a partnership for federal income tax purposes, (y) following such
merger, consolidation, amalgamation or replacement, Transamerica and such
successor entity will be in compliance with the 1940 Act without registering
thereunder as an investment company and (z) such merger, consolidation,
amalgamation or replacement will not adversely affect the limited liability of
the holders of the Series A Preferred Securities and (viii) Transamerica
guarantees the obligations of such successor entity under the Successor
Securities at least to the extent provided by the Guarantee.
VOTING RIGHTS
Except as provided below and under "Description of the
Guarantee -- Amendments and Assignment" in the accompanying Prospectus and as
otherwise required by law and the Limited Partnership Agreement, the holders of
the Series A Preferred Securities will have no voting rights.
If (i) arrearages on dividends on the Series A Preferred Securities shall
exist for 18 consecutive monthly dividend periods; (ii) an Event of Default (as
defined in the Indenture) occurs and is continuing on the Series A Junior
Subordinated Debentures; or (iii) Transamerica is in default on any of its
payment obligations under the Guarantee (as described under "Description of the
Guarantee -- Certain Covenants of Transamerica" in the accompanying Prospectus),
then the holders of the Series A Preferred Securities, together with the holders
of any other series of Preferred Securities having the right to vote for the
appointment of a special representative of Transamerica Delaware and the limited
partners (a "Special Representative") in such event, acting as a single class,
will be entitled by the vote of a majority in aggregate liquidation preference
of such holders to appoint and authorize a Special Representative to enforce
Transamerica Delaware's creditor rights under the Series A Junior Subordinated
Debentures, to enforce the rights of the holders of the Series A Preferred
Securities under the Guarantee and to enforce the rights of the holders of the
Series A Preferred Securities to receive dividends (if and to the extent
declared) on the Series A Preferred Securities. The Special Representative shall
not, by virtue of acting in such capacity, be admitted as a general partner in
Transamerica Delaware or otherwise be deemed to be a general partner in
Transamerica Delaware and shall have no liability for the debts, obligations or
liabilities of Transamerica Delaware. Not later than 30 days after such right to
appoint a Special Representative arises, the General Partner will convene a
meeting for the purpose of appointing a Special Representative. If the General
Partner fails to convene such meeting within such 30-day period, the holders of
10% in liquidation preference of the outstanding Preferred Securities will be
entitled to convene such meeting. The provisions of the Limited Partnership
Agreement relating to the convening and conduct of the meetings of the partners
will apply with respect to any such meeting. In the event that, at any such
meeting, holders of less than a majority in aggregate liquidation preference of
Preferred Securities entitled to vote for the appointment of a Special
Representative vote for such appointment, no Special Representative shall be
appointed. Any
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Special Representative appointed shall cease to be a Special Representative of
Transamerica Delaware and the limited partners if Transamerica Delaware (or
Transamerica pursuant to the Guarantee) shall have paid in full all accrued and
unpaid dividends on the Preferred Securities or such default or breach, as the
case may be, shall have been cured, and Transamerica, in its capacity as the
General Partner, shall continue the business of Transamerica Delaware without
dissolution. Notwithstanding the appointment of any such Special Representative,
Transamerica shall continue as General Partner and shall retain all rights under
the Indenture, including the right to extend the interest payment period from
time to time to a period not exceeding 60 consecutive months as provided under
"Description of the Series A Junior Subordinated Debentures -- Option to Extend
Interest Payment Period", and any such extension would not constitute a default
under the Indenture or enable a holder of Series A Preferred Securities to
require the payment of a dividend that has not theretofore been declared.
If any proposed amendment to the Limited Partnership Agreement provides
for, or the General Partner otherwise proposes to effect, (i) any action that
would adversely affect the powers, preferences or special rights of the Series A
Preferred Securities, whether by way of amendment to the Limited Partnership
Agreement or otherwise (including, without limitation, the authorization or
issuance of any limited partner interests in Transamerica Delaware ranking, as
to participation in the profits or dividends or in the assets of Transamerica
Delaware, senior to the Series A Preferred Securities), or (ii) the dissolution,
winding-up or termination of Transamerica Delaware, other than (x) in connection
with the distribution of Series A Junior Subordinated Debentures upon the
occurrence of a Special Event or (y) as described under "Merger, Consolidation
or Amalgamation of Transamerica Delaware" above, then the holders of outstanding
Series A Preferred Securities will be entitled to vote on such amendment or
proposal of the General Partner (but not on any other amendment or proposal) as
a class with all other holders of series of Preferred Securities similarly
affected, and such amendment or proposal shall not be effective except with the
approval of the holders of 66 2/3% in liquidation preference of such outstanding
Preferred Securities having a right to vote on the matter; provided, however,
that no such approval shall be required if the dissolution, winding-up or
termination of Transamerica Delaware is proposed or initiated upon the
initiation of proceedings, or after proceedings have been initiated, for the
dissolution, winding-up, liquidation or termination of Transamerica.
The rights attached to the Series A Preferred Securities will be deemed not
to be adversely affected by the creation or issue of, and no vote will be
required for the creation or issue of, any further limited partner interests of
Transamerica Delaware ranking pari passu with the Series A Preferred Securities
with regard to participation in the profits or dividends or in the assets of
Transamerica Delaware. Holders of Series A Preferred Securities have no
preemptive rights.
So long as any Series A Junior Subordinated Debentures are held by
Transamerica Delaware, the General Partner shall not (i) direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee,
or executing any trust or power conferred on the Trustee with respect to such
series, (ii) waive any past default that is waivable under Section 6.06 of the
Indenture, (iii) exercise any right to rescind or annul a declaration that the
principal of all the Series A Junior Subordinated Debentures shall be due and
payable or (iv) consent to any amendment, modification or termination of the
Indenture or the Series A Junior Subordinated Debentures, where such consent
shall be required, without, in each case, obtaining the prior approval of the
holders of at least 66 2/3% in liquidation preference of all series of Preferred
Securities who would be affected thereby if their Preferred Securities were to
be exchanged for Junior Subordinated Debentures, acting as a single class;
provided, however, that where a consent under the Indenture would require the
consent of each holder affected thereby, no such consent shall be given by the
General Partner without the prior consent of each holder of all series of
Preferred Securities affected thereby. The General Partner shall not revoke any
action previously authorized or approved by a vote of any series of Preferred
Securities. The General Partner shall notify all
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holders of the Series A Preferred Securities of any notice of default received
from the Trustee with respect to the Series A Junior Subordinated Debentures.
Any required approval of holders of Series A Preferred Securities may be
given at a separate meeting of holders of Preferred Securities convened for such
purpose, at a meeting of all of the partners in Transamerica Delaware or
pursuant to written consent. Transamerica Delaware will cause a notice of any
meeting at which holders of Series A Preferred Securities are entitled to vote,
or of any matter upon which action by written consent of such holders is to be
taken, to be mailed to each holder of record of Series A Preferred Securities.
Each such notice will include a statement setting forth (i) the date of such
meeting or the date by which such action is to be taken, (ii) a description of
any resolution proposed for adoption at such meeting on which such holders are
entitled to vote or of such matter upon which written consent is sought and
(iii) instructions for the delivery of proxies or consents.
No vote or consent of the holders of Series A Preferred Securities will be
required for Transamerica Delaware to redeem and cancel Series A Preferred
Securities in accordance with the Limited Partnership Agreement.
Notwithstanding that holders of Series A Preferred Securities are entitled
to vote or consent under any of the circumstances described above, any of the
Series A Preferred Securities and any other series of Preferred Securities that
are entitled to vote or consent with such Series A Preferred Securities as a
single class at such time that are owned by Transamerica or by any entity more
than 50% of which is owned by Transamerica, either directly or indirectly, shall
not be entitled to vote or consent and shall, for purposes of such vote or
consent, be treated as if they were not outstanding.
Holders of the Series A Preferred Securities will have no rights to remove
or replace the General Partner.
BOOK-ENTRY-ONLY ISSUANCE -- THE DEPOSITORY TRUST COMPANY
DTC will act as securities depository for the Series A Preferred
Securities. The Series A Preferred Securities will be issued only as fully
registered securities registered in the name of Cede & Co. (DTC's nominee). One
or more fully registered global Series A Preferred Security certificates will be
issued, representing in the aggregate the total number of Series A Preferred
Securities, and will be deposited with DTC.
DTC is a limited-purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"). DTC holds securities that its
participants ("Participants") deposit with DTC. DTC also facilitates the
settlement among Participants of securities transactions, such as transfers and
pledges, in deposited securities through electronic computerized book-entry
changes in Participants' accounts, thereby eliminating the need for physical
movement of securities certificates. Direct Participants include securities
brokers and dealers, banks, trust companies, clearing corporations, and certain
other organizations ("Direct Participants"). DTC is owned by a number of its
Direct Participants and by the New York Stock Exchange, Inc. (the "New York
Stock Exchange"), the American Stock Exchange, Inc., and the National
Association of Securities Dealers, Inc. Access to the DTC system is also
available to others such as securities brokers and dealers, banks and trust
companies that clear through or maintain a custodial relationship with a Direct
Participant, either directly or indirectly ("Indirect Participants"). The rules
applicable to DTC and its Participants are on file with the Securities and
Exchange Commission.
Purchases of Series A Preferred Securities within the DTC system must be
made by or through Direct Participants, which will receive a credit for the
Series A Preferred Securities on DTC's
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records. The ownership interest of each actual purchaser of each Series A
Preferred Security ("Beneficial Owner") is in turn to be recorded on the Direct
and Indirect Participants' records. Beneficial Owners will not receive written
confirmation from DTC of their purchases, but Beneficial Owners are expected to
receive written confirmations providing details of the transactions, as well as
periodic statements of their holdings, from the Direct or Indirect Participants
through which the Beneficial Owners purchased Series A Preferred Securities.
Transfers of ownership interests in the Series A Preferred Securities are to be
accomplished by entries made on the books of Participants acting on behalf of
Beneficial Owners. Beneficial Owners will not receive certificates representing
their ownership interests in Series A Preferred Securities, except in the event
that use of the book-entry system for the Series A Preferred Securities is
discontinued.
DTC has no knowledge of the actual Beneficial Owners of the Series A
Preferred Securities; DTC's records reflect only the identity of the Direct
Participants to whose accounts such Series A Preferred Securities are credited,
which may or may not be the Beneficial Owners. The Participants will remain
responsible for keeping account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time.
Redemption notices shall be sent to Cede & Co. If less than all of the
Series A Preferred Securities are being redeemed, DTC's practice is to determine
by lot the amount of the interest of each Direct Participant in such series to
be redeemed.
Although voting with respect to the Series A Preferred Securities is
limited, in those instances in which a vote is required, neither DTC nor Cede &
Co. itself will consent or vote with respect to Series A Preferred Securities.
Under its usual procedures, DTC would mail an Omnibus Proxy to Transamerica
Delaware as soon as possible after the record date. The Omnibus Proxy assigns
Cede & Co.'s consenting or voting rights to those Direct Participants to whose
accounts the Series A Preferred Securities are credited on the record date
(identified in a listing attached to the Omnibus Proxy).
Dividend payments on the Series A Preferred Securities will be made by
Transamerica Delaware to DTC. DTC's practice is to credit Direct Participants'
accounts on the relevant payment date in accordance with their respective
holdings shown on DTC's records unless DTC has reason to believe that it will
not receive payments on such payment date. Payments by Participants to
Beneficial Owners will be governed by standing instructions and customary
practices and will be the responsibility of such Participants and not of DTC,
Transamerica Delaware or Transamerica, subject to any statutory or regulatory
requirements as may be in effect from time to time. Payment of dividends to DTC
is the responsibility of Transamerica Delaware, disbursement of such payments to
Direct Participants is the responsibility of DTC, and disbursement of such
payments to the Beneficial Owners is the responsibility of Direct and Indirect
Participants.
DTC may discontinue providing its services as securities depository with
respect to the Series A Preferred Securities at any time by giving reasonable
notice to Transamerica Delaware. Under such circumstances, in the event that a
successor securities depository is not obtained, Series A Preferred Security
certificates are required to be printed and delivered. Additionally,
Transamerica Delaware (with the consent of Transamerica) may decide to
discontinue use of the system of book-entry transfers through DTC (or a
successor depository). In that event, certificates for the Series A Preferred
Securities will be printed and delivered. In each of the above circumstances,
the General Partner will appoint a paying agent with respect to the Series A
Preferred Securities.
The information in this section concerning DTC and DTC's book-entry system
has been obtained from sources that Transamerica Delaware and Transamerica
believe to be reliable, but Transamerica Delaware and Transamerica take no
responsibility for the accuracy thereof.
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REGISTRAR AND TRANSFER AGENT
In the event the book-entry system for the Series A Preferred Securities is
discontinued, it is anticipated that The First National Bank of Chicago, or one
of its affiliates, will act as registrar and transfer agent for the Series A
Preferred Securities.
Registration of transfers of Series A Preferred Securities will be effected
without charge by or on behalf of Transamerica Delaware, but upon payment (with
the giving of such indemnity as Transamerica Delaware or Transamerica may
require) in respect of any tax or other governmental charges that may be imposed
in relation to it.
Transamerica Delaware will not be required to register or cause to be
registered the transfer of Series A Preferred Securities after such Series A
Preferred Securities have been called for redemption.
MISCELLANEOUS
Application has been made to list the Series A Preferred Securities on the
New York Stock Exchange. See "Underwriting."
The General Partner is authorized and directed to conduct its affairs and
to operate Transamerica Delaware in such a way that Transamerica Delaware will
not be deemed to be an "investment company" required to be registered under the
1940 Act or taxed as a corporation for federal income tax purposes and so that
the Series A Junior Subordinated Debentures will be treated as indebtedness of
Transamerica for federal income tax purposes. In this connection, the General
Partner is authorized to take any action, not inconsistent with applicable law,
the certificate of limited partnership of Transamerica Delaware or the Limited
Partnership Agreement, that the General Partner determines in its discretion to
be necessary or desirable for such purposes, as long as such action does not
adversely affect the interests of the holders of the Series A Preferred
Securities.
DESCRIPTION OF THE SERIES A JUNIOR SUBORDINATED DEBENTURES
Set forth below is a description of specific terms of the Series A Junior
Subordinated Debentures in which Transamerica Delaware will invest (i) the
proceeds of the issuance and sale of the Series A Preferred Securities and (ii)
the General Partner's capital contribution with respect to the Series A
Preferred Securities (the "General Partnership Payment"). This description
supplements the description of the general terms and provisions of the Junior
Subordinated Debentures set forth in the accompanying Prospectus under the
caption "Description of the Junior Subordinated Debentures". The following
description does not purport to be complete and is qualified in its entirety by
reference to the description in the accompanying Prospectus and the Indenture,
dated as of , 1994, between Transamerica and The First National Bank
of Chicago, as Trustee (the "Indenture") which has been filed as an exhibit to
the Registration Statement of which this Prospectus Supplement forms a part.
Under certain circumstances involving the dissolution of Transamerica
Delaware following the occurrence of a Special Event, Series A Junior
Subordinated Debentures may be distributed to the holders of the Series A
Preferred Securities in liquidation of Transamerica Delaware. See "Description
of the Series A Preferred Securities -- Special Event Redemption or
Distribution".
GENERAL
The Series A Junior Subordinated Debentures will be issued as a series of
Junior Subordinated Debentures under the Indenture. The Series A Junior
Subordinated Debentures will be limited in aggregate principal amount to
approximately $ million, such amount being the sum of the aggregate stated
liquidation preference of the Series A Preferred Securities and the General
Partnership Payment.
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The entire principal amount of the Series A Junior Subordinated Debentures
will become due and payable, together with any accrued and unpaid interest
thereon, including Additional Interest (as hereinafter defined), if any, on
, 2024.
The Series A Junior Subordinated Debentures, if distributed to holders of
Series A Preferred Securities in dissolution, will initially be so issued as a
Global Security (as defined below). As described herein, under certain limited
circumstances Series A Junior Subordinated Debentures may be issued in
certificated form in exchange for a Global Security. See "Book-Entry and
Settlement" below. In the event that Series A Junior Subordinated Debentures are
issued in certificated form, such Series A Junior Subordinated Debentures will
be in denominations of $25 and integral multiples thereof and may be transferred
or exchanged at the offices described below.
Payments on Series A Junior Subordinated Debentures issued as a Global
Security will be made to DTC, as the depository for the Series A Junior
Subordinated Debentures. In the event Series A Junior Subordinated Debentures
are issued in certificated form, principal and interest will be payable, the
transfer of the Series A Junior Subordinated Debentures will be registrable, and
Series A Junior Subordinated Debentures will be exchangeable for Series A Junior
Subordinated Debentures of other denominations of a like aggregate principal
amount, at the corporate trust office of the Trustee in The City of New York;
provided that payment of interest may be made at the option of Transamerica by
check mailed to the address of the persons entitled thereto.
If the Series A Junior Subordinated Debentures are distributed to the
holders of Series A Preferred Securities upon the dissolution of Transamerica
Delaware, Transamerica will use its best efforts to list the Series A Junior
Subordinated Debentures on the New York Stock Exchange or on such other exchange
as the Series A Preferred Securities are then listed.
MANDATORY PREPAYMENT
If Transamerica Delaware redeems Series A Preferred Securities in
accordance with the terms thereof, the Series A Junior Subordinated Debentures
will become due and payable in a principal amount equal to the aggregate stated
liquidation preference of the Series A Preferred Securities so redeemed,
together with any accrued and unpaid interest thereon, including Additional
Interest, if any. Any payment pursuant to this provision shall be made prior to
12:00 noon, New York City time, on the date of such redemption or at such other
time on such earlier date as the parties thereto shall agree. The Series A
Junior Subordinated Debentures are not entitled to the benefit of any sinking
fund or, except as set forth above, any other provision for mandatory
prepayment.
OPTIONAL REDEMPTION
If there shall be no Series A Preferred Securities outstanding,
Transamerica shall have the right to redeem the Series A Junior Subordinated
Debentures, in whole or in part, from time to time, on or after ,
1999, upon not less than 30 nor more than 60 days' notice, at a redemption price
equal to 100% of the principal amount to be redeemed plus any accrued and unpaid
interest, including Additional Interest, if any, to the redemption date. If
Transamerica or Transamerica Delaware purchases Series A Preferred Securities by
tender, in the open market or by private agreement, Transamerica shall have the
right to redeem Series A Junior Subordinated Debentures, in an amount not to
exceed the aggregate stated liquidation preference of the Series A Preferred
Securities so purchased, together with any accrued and unpaid interest thereon,
including Additional Interest, if any, to the redemption date.
INTEREST
Each Series A Junior Subordinated Debenture shall bear interest at an
interest rate that will be adjusted quarterly. The rate for the initial period
from the date of initial issuance to , 1994 will be % per
annum. Thereafter, interest on the Series A Junior Subordinated Debentures will
be payable at the "Applicable Rate" in effect from time to time. The Applicable
Rate for any quarter
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will be equal to % of the highest of the "Treasury Bill Rate", the "Ten
Year Constant Maturity Rate" and the "Thirty Year Constant Maturity Rate"
determined in advance of such quarter; but not less than % per annum nor
greater than % per annum. The "Treasury Bill Rate", the "Ten Year Constant
Maturity Rate" and the "Thirty Year Constant Maturity Rate" with respect to any
quarter shall be determined by Transamerica Delaware in the same manner as, and
consistent with its determinations with respect to, quarters for the purposes of
dividends payable on the Series A Preferred Securities. See "Description of the
Series A Preferred Securities -- Dividends".
Such interest is payable monthly in arrears on the last day of each
calendar month of each year (each, an "Interest Payment Date"), commencing
, 1994, to the person in whose name such Series A Junior Subordinated
Debenture is registered, subject to certain exceptions, at the close of business
on the Business Day next preceding such Interest Payment Date. In the event the
Series A Junior Subordinated Debentures shall not continue to remain in
book-entry-only form, Transamerica shall have the right to select record dates
which shall be more than one Business Day prior to the Interest Payment Date.
The amount of interest payable for any period will be computed on the basis
of a 360-day year of twelve 30-day months. In the event that any date on which
interest is payable on the Series A Junior Subordinated Debentures is not a
Business Day, then payment of the interest payable on such date will be made on
the next succeeding day that is a Business Day (and without any interest or
other payment in respect of any such delay), except that, if such Business Day
is in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
Transamerica shall have the right at any time during the term of the Series
A Junior Subordinated Debentures to extend the interest payment period from time
to time to a period not exceeding 60 consecutive months (the "Extension
Period"), at the end of which Extension Period Transamerica shall pay all
interest then accrued and unpaid (together with interest thereon at the rate
specified for the Series A Junior Subordinated Debentures to the extent
permitted by applicable law); provided that, during any such Extension Period,
Transamerica shall not declare or pay any dividend on, or purchase, acquire or
make a liquidation payment with respect to, any of its common stock. Prior to
the termination of any such Extension Period, Transamerica may further extend
the interest payment period, provided that such Extension Period together with
all such previous and further extensions thereof may not exceed 60 consecutive
months. Upon the termination of any Extension Period and the payment of all
amounts then due, Transamerica may select a new Extension Period, subject to the
above requirements. No interest shall be due and payable during an Extension
Period, except at the end thereof. The failure by Transamerica to make interest
payments during an Extension Period would not constitute a default or an event
of default under Transamerica's currently outstanding indebtedness. If
Transamerica Delaware shall be the sole holder of the Series A Junior
Subordinated Debentures, Transamerica shall give Transamerica Delaware notice of
its selection of such Extension Period one Business Day prior to the earlier of
(i) the date the dividends on the Series A Preferred Securities are payable or
(ii) the date Transamerica Delaware is required to give notice to the New York
Stock Exchange or other applicable self-regulatory organization or to holders of
the Series A Preferred Securities of the record date or the date such dividend
is payable, but in any event not less than one Business Day prior to such record
date. Transamerica shall cause Transamerica Delaware to give notice of
Transamerica's selection of such Extension Period to the holders of the Series A
Preferred Securities. If Transamerica Delaware shall not be the sole holder of
the Series A Junior Subordinated Debentures, Transamerica shall give the holders
of the Series A Junior Subordinated Debentures notice of its selection of such
Extension Period ten Business Days prior to the earlier of (i) the Interest
Payment Date or (ii) the date Transamerica is required to give notice to the New
York Stock Exchange or other applicable self-regulatory organization or to
holders of the Series A Junior Subordinated Debentures of the record
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or payment date of such related interest payment, but in any event not less than
two Business Days prior to such record date.
ADDITIONAL INTEREST
If at any time Transamerica Delaware shall be required to pay any interest
on dividends in arrears in respect of the Series A Preferred Securities pursuant
to the terms thereof, then Transamerica will pay as interest to Transamerica
Delaware as the holder of the Series A Junior Subordinated Debentures
("Additional Interest") an amount equal to such interest on dividends in
arrears.
SET-OFF
Notwithstanding anything to the contrary in the Indenture, Transamerica
shall have the right to set-off any payment it is otherwise required to make
thereunder with and to the extent Transamerica has theretofore made, or is
concurrently on the date of such payment making, a payment under the Guarantee.
EVENTS OF DEFAULT
In the case that any Event of Default (as defined in the Indenture and as
described in the accompanying Prospectus) shall occur and be continuing,
Transamerica Delaware will have the right to declare the principal of and the
interest on the Series A Junior Subordinated Debentures (including any
Additional Interest) and any other amounts payable under the Indenture to be
forthwith due and payable and to enforce its other rights as a creditor with
respect to the Series A Junior Subordinated Debentures. See "Enforcement of
Certain Rights by Special Representative" below for a discussion of certain
rights available to holders of the Series A Preferred Securities upon the
occurrence of an Event of Default.
ENFORCEMENT OF CERTAIN RIGHTS BY SPECIAL REPRESENTATIVE
If (i) arrearages on dividends on the Series A Preferred Securities shall
exist for 18 consecutive monthly dividend periods; (ii) an Event of Default
occurs and is continuing on the Series A Junior Subordinated Debentures; or
(iii) Transamerica is in default on any of its payment or other obligations
under the Guarantee, under the terms of the Series A Preferred Securities, the
holders of outstanding Series A Preferred Securities will have the rights
referred to under "Description of the Series A Preferred Securities -- Voting
Rights", including the right to appoint a Special Representative, which Special
Representative shall be authorized to exercise Transamerica Delaware's right to
accelerate the principal amount of the Series A Junior Subordinated Debentures
upon an Event of Default and to enforce Transamerica Delaware's other creditor
rights under the Series A Junior Subordinated Debentures. Notwithstanding the
appointment of any such Special Representative, Transamerica shall continue as
General Partner and shall retain all rights under the Indenture, including the
right to extend the interest payment period from time to time to a period not
exceeding 60 consecutive months, and any such extension would not constitute a
default under the Indenture or enable a holder of Series A Preferred Securities
to require the payment of a dividend that has not theretofore been declared.
BOOK-ENTRY AND SETTLEMENT
If distributed to holders of Series A Preferred Securities in connection
with the dissolution of Transamerica Delaware as a result of the occurrence of a
Special Event, the Series A Junior Subordinated Debentures will be issued in the
form of one or more global certificates (each, a "Global Security") registered
in the name of the nominee of DTC. Except under the limited circumstances
described below, Series A Junior Subordinated Debentures represented by the
Global Security will not be exchangeable for, and will not otherwise be issuable
as, Series A Junior
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Subordinated Debentures in definitive form. The Global Securities described
above may not be transferred except by DTC to a nominee of DTC or by a nominee
of DTC to DTC or another nominee of DTC or to a successor depository or its
nominee.
Except as provided below, owners of beneficial interests in such a Global
Security will not be entitled to receive physical delivery of Series A Junior
Subordinated Debentures in definitive form and will not be considered the
Holders (as defined in the Indenture) thereof for any purpose under the
Indenture, and no Global Security representing Series A Junior Subordinated
Debentures shall be exchangeable, except for another Global Security of like
denomination and tenor to be registered in the name of DTC or its nominee or to
a successor depository or its nominee. Accordingly, each beneficial owner must
rely on the procedures of DTC and, if such person is not a Participant, on the
procedures of the Participant through which such person owns its interest, to
exercise any rights of a Holder under the Indenture.
The Depository. DTC will act as security depository for the Series A
Junior Subordinated Debentures. For a description of DTC and the specific terms
of the depository arrangements, see "Description of the Series A Preferred
Securities -- Book-Entry-Only Issuance -- The Depository Trust Company". As of
the date of this Prospectus Supplement, the description therein of DTC's
book-entry system and DTC's practices as they relate to purchases, transfers,
notices and payments with respect to the Series A Preferred Securities apply in
all material respects to any debt obligations represented by one or more Global
Securities held by DTC.
Neither Transamerica, the Trustee, any paying agent nor any other agent of
Transamerica or the Trustee will have any responsibility or liability for any
aspect of the records relating to or payments made on account of beneficial
ownership interests in a Global Security for such Series A Junior Subordinated
Debentures or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
Discontinuance of the Depository's Services. A Global Security shall be
exchangeable for Series A Junior Subordinated Debentures registered in the names
of persons other than DTC or its nominee only if (i) DTC notifies Transamerica
that it is unwilling or unable to continue as a depository for such Global
Security and no successor depository shall have been appointed, or if any time
DTC ceases to be a clearing agency registered under the Exchange Act at a time
when DTC is required to be so registered to act as such depository, (ii)
Transamerica in its sole discretion determines that such Global Security shall
be so exchangeable or (iii) there shall have occurred an Event of Default with
respect to such Series A Junior Subordinated Debentures. Any Global Security
that is exchangeable pursuant to the preceding sentence shall be exchangeable
for Series A Junior Subordinated Debentures registered in such names as the
Depository shall direct. It is expected that such instructions will be based
upon directions received by the Depository from its Participants with respect to
ownership of beneficial interests in such Global Security.
MISCELLANEOUS
For restrictions on certain actions of the General Partner with respect to
Series A Junior Subordinated Debentures held by Transamerica Delaware, see
"Description of the Series A Preferred Securities -- Voting Rights".
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RELATIONSHIP BETWEEN THE SERIES A PREFERRED SECURITIES,
THE SERIES A JUNIOR SUBORDINATED DEBENTURES AND THE GUARANTEE
As long as payments of interest and other payments are made when due on the
Series A Junior Subordinated Debentures, such payments will be sufficient to
cover dividends (if and to the extent declared) and other payments due on the
Series A Preferred Securities primarily because (i) the aggregate principal
amount of Series A Junior Subordinated Debentures will be equal to the sum of
the aggregate stated liquidation preference of the Series A Preferred Securities
and the General Partnership Payment; (ii) the interest rate and interest and
other payment dates on the Series A Junior Subordinated Debentures will match
the dividend rate and dividend and other payment dates for the Series A
Preferred Securities; (iii) the Limited Partnership Agreement provides that
Transamerica, as General Partner, shall pay for all, and Transamerica Delaware
shall not be obligated to pay, directly or indirectly, for any, costs and
expenses of Transamerica Delaware, including any income taxes, duties and other
governmental charges, and all costs and expenses with respect thereto, to which
Transamerica Delaware may become subject, except for United States withholding
taxes; and (iv) the Limited Partnership Agreement further provides that the
General Partner shall not cause or permit Transamerica Delaware, among other
things, to engage in any activity that is not consistent with the limited
purposes of Transamerica Delaware.
Payments of dividends (if and to the extent declared) and other payments
due on the Series A Preferred Securities are guaranteed by Transamerica as and
to the extent set forth under "Description of the Guarantee" in the accompanying
Prospectus. If Transamerica does not make interest payments on the Series A
Junior Subordinated Debentures purchased by Transamerica Delaware, it is
expected that Transamerica Delaware will not declare or pay dividends on the
Series A Preferred Securities. The Guarantee is a full and unconditional
guarantee from the time of issuance of the Series A Preferred Securities, but
does not apply to any payment of dividends unless and until such dividends are
declared.
If Transamerica fails to make interest or other payments on the Series A
Junior Subordinated Debentures when due, the Limited Partnership Agreement
provides a mechanism whereby the holders of the Series A Preferred Securities
may appoint a Special Representative to enforce the rights of Transamerica
Delaware under the Series A Junior Subordinated Debentures. The Limited
Partnership Agreement also provides, and Transamerica, under the Guarantee,
acknowledges, that a Special Representative may be appointed to enforce the
Guarantee if Transamerica is in default on any of its payment obligations under
the Guarantee. In addition, if the General Partner or the Special Representative
fails to enforce the Guarantee, a holder of a Series A Preferred Security may,
after a period of 30 days has elapsed from such holder's written request to the
General Partner or the Special Representative, as the case may be, to enforce
the Guarantee, institute a legal proceeding directly against Transamerica to
enforce its rights under the Guarantee without first instituting a legal
proceeding against Transamerica Delaware or any other person or entity.
If a Special Event shall occur and be continuing, the General Partner may
elect to dissolve Transamerica Delaware, and to cause Series A Junior
Subordinated Debentures to be distributed in exchange for the outstanding Series
A Preferred Securities. The Series A Preferred Securities represent limited
partner interests in Transamerica Delaware, a limited partnership which exists
for the sole purpose of issuing its partnership interests and investing the
proceeds thereof in debt securities of Transamerica, while the Series A Junior
Subordinated Debentures represent indebtedness of Transamerica, a diversified
financial services company (see "Transamerica Corporation"). A principal
difference between the rights of a holder of Series A Preferred Securities and a
holder of Series A Junior Subordinated Debentures is that the Series A Junior
Subordinated Debentures will accrue, and (subject to the permissible extension
of the interest period) a holder thereof will be entitled to receive, interest
on the principal amount of Series A Junior Subordinated Debentures held, while a
holder of Series A Preferred Securities is only entitled to receive dividends if
and to the extent declared by the General Partner.
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Upon any voluntary or involuntary dissolution, winding-up or termination of
Transamerica Delaware, the holders of Series A Preferred Securities will be
entitled to receive, out of assets legally available for distribution to
partners, the Liquidation Distribution in cash or Series A Junior Subordinated
Debentures and will be entitled to the benefits of the Guarantee with respect to
any such distribution. See "Description of the Series A Preferred
Securities -- Liquidation Distribution Upon Dissolution". Upon any voluntary or
involuntary liquidation or bankruptcy of Transamerica, the holders of Series A
Junior Subordinated Debentures would be subordinated creditors of Transamerica,
subordinated in right of payment to all Senior Indebtedness, but entitled to
receive payment in full of principal, premium, if any, and interest, before any
stockholders of Transamerica receive payments or distributions.
A default or event of default under any Senior Indebtedness would not
constitute a default or event of default under the Series A Junior Subordinated
Debentures. However, in the event of payment defaults under, or acceleration of,
Senior Indebtedness, the subordination provisions of the Series A Junior
Subordinated Debentures provide that no payments may be made in respect of the
Series A Junior Subordinated Debentures. Failure to make required payments on
the Series A Junior Subordinated Debentures would constitute an event of default
under the Indenture.
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UNITED STATES TAXATION
GENERAL
This section is a summary of certain United States federal income tax
considerations that may be relevant to prospective purchasers of Series A
Preferred Securities and represents the opinion of Wachtell, Lipton, Rosen &
Katz, special counsel to Transamerica and Transamerica Delaware, insofar as it
relates to matters of law and legal conclusions. This section is based upon
current provisions of the Internal Revenue Code of 1986, as amended (the
"Code"), existing and proposed regulations thereunder and current administrative
rulings and court decisions, all of which are subject to change. Subsequent
changes may cause tax consequences to vary substantially from the consequences
described below.
No attempt has been made in the following discussion to comment on all
United States federal income tax matters affecting purchasers of Series A
Preferred Securities. Moreover, the discussion generally focuses on holders of
Series A Preferred Securities who are individual citizens or residents of the
United States and who hold the Series A Preferred Securities as capital assets.
This discussion has only limited application to corporations, estates, trusts or
non-resident aliens. Accordingly, each prospective purchaser of Series A
Preferred Securities should consult, and should depend on, the purchasers' own
tax advisor in analyzing the federal, state, local and foreign tax consequences
of the purchase, ownership or disposition of Series A Preferred Securities.
OPINION OF COUNSEL
In the opinion of Wachtell, Lipton, Rosen & Katz, (i) Transamerica Delaware
will be a partnership for federal income tax purposes; and (ii) the Series A
Junior Subordinated Debentures will be classified as indebtedness of
Transamerica. Several recent pronouncements of the Internal Revenue Service (the
"IRS"), however, evidence increasing concern by the IRS over arrangements
similar to some respects to those involving Transamerica Delaware, the Series A
Preferred Securities, and the Series A Junior Subordinated Debentures. While
these pronouncements are not considered to apply to the arrangements described
herein, it is possible that future pronouncements or other developments could
adversely affect such arrangements. It should be noted in this connection that
Transamerica has the right to redeem the Series A Preferred Securities or
dissolve Transamerica Delaware upon the occurrence of a Tax Event (as defined
under "Description of the Series A Preferred Securities -- Special Event
Redemption or Distribution").
INCOME FROM SERIES A PREFERRED SECURITIES
Each holder of Series A Preferred Securities (a "Preferred Securityholder")
will be required to include in gross income the Preferred Securityholder's
distributive share of the net income of Transamerica Delaware. Such income
should not exceed the dividends received on such Series A Preferred Securities,
except in limited circumstances as described below under "Potential Extension of
Interest Payment Period". No portion of such income will be eligible for the
dividends received deduction.
Transamerica Delaware does not currently intend to make an election under
Section 754 of the Code. As a result, a subsequent purchaser of Series A
Preferred Securities in the secondary market will not be permitted or required
to adjust the tax basis in its allocable share of Transamerica Delaware's assets
so as to reflect any difference between its purchase price for the Preferred
Securities and the underlying tax basis of Transamerica Delaware in its assets.
As a result, a Preferred Securityholder may be allocated a larger or smaller
amount of Transamerica Delaware's income than would otherwise be appropriate
based upon such Preferred Securityholder's purchase price for the Preferred
Security.
Under Section 708 of the Code, Transamerica Delaware will be deemed to
terminate for federal income tax purposes if 50% or more of the capital and
profits interest in Transamerica Delaware is
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sold or exchanged within a 12-month period. If such a termination occurs, there
will be a closing of Transamerica Delaware's taxable year for all partners and
Transamerica Delaware will be considered to distribute its assets to the
partners, who would then be treated as recontributing those assets to a new
partnership. Those assets might have a basis higher or lower than their basis in
the hands of Transamerica Delaware prior to termination, which might alter the
tax consequences to Preferred Securityholders.
DISPOSITION OF SERIES A PREFERRED SECURITIES
Gain or loss will be recognized on a sale of Series A Preferred Securities,
including a redemption for cash, equal to the difference between the amount
realized and the Preferred Securityholder's tax basis for the Series A Preferred
Securities sold. Gain or loss recognized by a Preferred Securityholder on the
sale or exchange of a Series A Preferred Security held for more than one year
generally will be taxable as long-term capital gain or loss.
RECEIPT OF SERIES A JUNIOR SUBORDINATED DEBENTURES
UPON LIQUIDATION OF TRANSAMERICA DELAWARE
Under certain circumstances, as described under the caption "Description of
the Series A Preferred Securities -- Special Event Redemption or Distribution",
Series A Junior Subordinated Debentures may be distributed to the Preferred
Securityholders in liquidation of Transamerica Delaware. Under current United
States federal income tax law, such a distribution would be treated as a
non-taxable exchange to each Preferred Securityholder and would result in the
Preferred Securityholder receiving an aggregate tax basis in the Series A Junior
Subordinated Debentures equal to such Preferred Securityholder's aggregate tax
basis in its Series A Preferred Securities. A Preferred Securityholder's holding
period in the Series A Junior Subordinated Debentures so received in liquidation
of Transamerica Delaware would include the period for which the Series A
Preferred Securities were held by such Preferred Securityholder. As a result, in
certain circumstances the Series A Junior Subordinated Debentures received in
liquidation might bear "market discount", "amortizable bond premium", or
"acquisition premium" which might alter the tax treatment of such Debentures in
the hands of the Preferred Securityholder as compared with the consequences of
holding Series A Preferred Securities. Under a change in law, a change in legal
interpretation or the other circumstances giving rise to a Special Event,
however, the dissolution could be a taxable event to Preferred Securityholders.
TRANSAMERICA DELAWARE INFORMATION RETURNS AND AUDIT PROCEDURES
Transamerica, as the General Partner in Transamerica Delaware, will furnish
each Preferred Securityholder with a Schedule K-1 each year setting forth such
Preferred Securityholder's allocable share of income for the prior calendar
year. Transamerica is required to furnish such Schedule K-1 as soon as
practicable following the end of the year, but in any event prior to March 31 of
the following year.
Any person who holds Series A Preferred Securities as a nominee for another
person is required to furnish to Transamerica Delaware (a) the name, address and
taxpayer identification number of each of the beneficial owner and the nominee;
(b) information as to whether the beneficial owner is (i) a person that is not a
United States person, (ii) a foreign government, an international organization
or any wholly-owned agency or instrumentality of either of the foregoing, or
(iii) a tax-exempt entity; (c) the amount and description of Series A Preferred
Securities held, acquired or transferred for the beneficial owner; and (d)
certain information including the dates of acquisitions and transfers, means of
acquisitions and transfers, and acquisition cost for purchases, as well as the
amount of net proceeds from sales. Brokers and financial institutions are
required to furnish additional information, including whether they are United
States persons and certain information on Series A Preferred Securities they
acquire, hold or transfer for their own accounts. A penalty of $50 per failure
(up to a maximum of $100,000 per calendar year) is imposed by the Code for
failure to report such information to Transamerica Delaware. The nominee is
required to supply
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the beneficial owners of the Series A Preferred Securities with the information
furnished to Transamerica Delaware.
POTENTIAL EXTENSION OF INTEREST PAYMENT PERIOD
Under the Indenture, Transamerica has the right to extend from time to time
the interest payment period on the Series A Junior Subordinated Debentures to a
period not exceeding 60 consecutive months. In the event that the interest
payment period is extended, Transamerica Delaware will continue to accrue income
(equal to the amount of the interest payment due at the end of the Extension
Period,) on an economic basis over the length of the Extension Period.
Accrued income will be allocated, but not distributed, to holders of record
on the Business Day preceding the last day of each calendar month. As a result,
holders of record during an Extension Period will include interest in their
gross income in advance of the receipt of cash, and any such holders who dispose
of Series A Preferred Securities prior to the record date for the payment of
dividends following such Extension Period will include interest in their gross
income but will not receive any cash related thereto from Transamerica Delaware.
The tax basis of a Series A Preferred Security will be increased by the amount
of any interest that is included in income without a receipt of cash, and will
be decreased again when and if such cash is subsequently received from
Transamerica Delaware.
UNITED STATES ALIEN HOLDERS
For purposes of this discussion, a "United States Alien Holder" is any
holder who or which is (i) a nonresident alien individual or (ii) a foreign
corporation, partnership or estate or trust, in either case not subject to
United States federal income tax on a net income basis in respect of a Series A
Preferred Security.
Under current United States federal income tax law, subject to the
discussion below with respect to backup withholding:
(i) payments by Transamerica Delaware or any of its paying agents to
any holder of a Series A Preferred Security who or which is a United States
Alien Holder should not be subject to United States federal withholding tax
provided that (a) the beneficial owner of the Series A Preferred Security
does not actually or constructively own 10% or more of the total combined
voting power of all classes of capital stock of Transamerica entitled to
vote, (b) the beneficial owner of the Series A Preferred Security is not a
controlled foreign corporation that is related to Transamerica through
stock ownership and (c) either (x) the beneficial owner of the Series A
Preferred Security certifies to Transamerica Delaware or its agent, under
penalties of perjury, that it is a United States Alien Holder and provides
its name and address or (y) the holder of the Series A Preferred Security
is a securities clearing organization, bank or other financial institution
that holds customers' securities in the ordinary course of its trade or
business (a "financial institution"), and such holder certifies to
Transamerica Delaware or its agent under penalties of perjury that such
statement has been received from the beneficial owner by it or by a
financial institution between it and the beneficial owner and furnishes
Transamerica Delaware or its agent with a copy thereof; and
(ii) a United States Alien Holder of a Series A Preferred Security
generally will not be subject to United States federal withholding tax on
any gain realized on the sale or exchange of a Series A Preferred Security
unless such holder is present in the United States for 183 days or more in
the taxable year of sale and either has a "tax home" in the United States
or certain other requirements are met.
In the event that the Series A Preferred Securities were characterized as
stock or other equity of Transamerica, payments to a holder characterized as
dividends could be subject to a 30% withholding tax or such lesser amount as may
be provided under an applicable treaty.
S-31
<PAGE> 65
BACKUP WITHHOLDING AND INFORMATION REPORTING
In general, information reporting requirements will apply to payments to
noncorporate United States holders of the proceeds of the sale of Series A
Preferred Securities within the United States and "backup withholding" at a rate
of 31% will apply to such payments if the United States holder fails to provide
an accurate taxpayer identification number.
Payments of the proceeds from the sale by a United States Alien Holder of
Series A Preferred Securities made to or through a foreign office of a broker
generally will not be subject to information reporting or backup withholding,
except that, if the broker is a United States person, a controlled foreign
corporation for United States tax purposes, or a foreign person 50% or more of
whose gross income is effectively connected with a United States trade or
business for a specified three-year period, information reporting may apply to
such payments. Payments of the proceeds from the sale of Series A Preferred
Securities to or through the United States office of a broker is subject to
information reporting and backup withholding unless the holder or beneficial
owner certifies as to its non-United States status or otherwise establishes an
exemption from information reporting and backup withholding.
S-32
<PAGE> 66
UNDERWRITING
Subject to the terms and conditions of the Underwriting Agreement,
Transamerica Delaware has agreed to sell to each of the Underwriters named
below, and each of the Underwriters, for whom Goldman, Sachs & Co. and
, are acting as Representatives, has severally agreed to
purchase from Transamerica Delaware, the respective number of Series A Preferred
Securities set forth opposite its name below:
<TABLE>
<CAPTION>
NUMBER OF
PREFERRED
UNDERWRITER SECURITIES
----------------------------------------------------------------- -----------
<S> <C>
Goldman, Sachs & Co..............................................
-----------
Total..................................................
=========
</TABLE>
The Underwriters propose to offer the Series A Preferred Securities in part
directly to the public at the initial public offering price set forth on the
cover page of this Prospectus Supplement, and in part to certain securities
dealers at such price less a concession of $ per Series A Preferred
Security. The Underwriters may allow, and such dealers may reallow, a concession
not in excess of $ per Series A Preferred Security to certain brokers
and dealers. After the Series A Preferred Securities are released for sale to
the public, the offering price and other selling terms may from time to time be
varied by the Representatives.
In view of the fact that the proceeds of the sale of the Series A Preferred
Securities ultimately will be used to purchase the Series A Junior Subordinated
Debentures, the Underwriting Agreement provides that Transamerica will pay as
compensation ("Underwriters' Compensation"), for the Underwriters' arranging the
investment therein of such proceeds, an amount in funds of $
per Series A Preferred Security ($ per Series A Preferred Security sold
to certain institutions) for the accounts of the several Underwriters.
Transamerica and Transamerica Delaware have agreed, during the period
beginning from the date of the Underwriting Agreement and continuing to and
including the later of (i) the termination of trading restrictions for the
Series A Preferred Securities, as notified to Transamerica by the
Representatives and (ii) the latest time of delivery for such Series A Preferred
Securities, not to offer, sell, contract to sell or otherwise dispose of, except
in accordance with the Underwriting Agreement, any Preferred Securities, any
preferred stock or any other securities of Transamerica or Transamerica Delaware
that are substantially similar to the Series A Preferred Securities, including
but not limited to any securities that are convertible into or exchangeable for,
or that represent the right to receive, Preferred Securities, preferred stock or
substantially similar securities of Transamerica or Transamerica Delaware,
without the prior written consent of the Representatives.
Application has been made to list the Series A Preferred Securities on the
New York Stock Exchange. Prior to this offering, there has been no public market
for the Series A Preferred Securities. In order to meet one of the requirements
for listing the Series A Preferred Securities on the New York Stock Exchange,
the Underwriters will undertake to sell lots of 100 or more Series A Preferred
Securities to a minimum of 400 beneficial holders. Trading of the Series A
Preferred Securities on the New York Stock Exchange is expected to commence
within a seven-day period after the initial delivery of the Series A Preferred
Securities. The Representatives have advised Transamerica that they intend to
make a market in the Series A Preferred Securities prior to the
S-33
<PAGE> 67
commencement of trading on the New York Stock Exchange, but are not obligated to
do so and may discontinue market making at any time without notice.
Transamerica Delaware and Transamerica have agreed to indemnify the
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933, as amended.
Certain of the Underwriters engage in transactions with, and from time to
time have performed services for, Transamerica and its subsidiaries in the
ordinary course of business.
LEGAL MATTERS
Certain matters of Delaware law relating to the validity of the Series A
Preferred Securities, the validity of the Limited Partnership Agreement and the
formation of Transamerica Delaware are being passed upon by Richards, Layton &
Finger, P.A., special Delaware counsel to Transamerica and Transamerica
Delaware. The validity of the Indenture, the Guarantee and the Series A Junior
Subordinated Debentures will be passed upon on behalf of Transamerica Delaware
and Transamerica by Christopher M. McLain, Esq., Senior Vice President and
General Counsel of Transamerica, and on behalf of the Underwriters by Cleary,
Gottlieb, Steen & Hamilton, counsel to the Underwriters. Statements as to United
States taxation in the Prospectus Supplement in the second paragraph under the
caption "Investment Considerations -- Special Event Redemption or Distribution",
and under the caption "United States Taxation", have been passed upon for
Transamerica and Transamerica Delaware by Wachtell, Lipton, Rosen & Katz,
special tax counsel to Transamerica and Transamerica Delaware, and are stated
herein on their authority.
S-34
<PAGE> 68
================================================================================
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE
PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT AND THE
PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO
BUY ANY SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS PROSPECTUS
SUPPLEMENT AND THE PROSPECTUS OR AN OFFER TO SELL OR THE SOLICITATION OF AN
OFFER TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR
SOLICITATION IS UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR
THE PROSPECTUS NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN OR
THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION.
---------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PROSPECTUS SUPPLEMENT
PAGE
----
<S> <C>
Transamerica Delaware.................... S-5
Transamerica Corporation................. S-5
Investment Considerations................ S-6
Summary Consolidated Financial Data...... S-8
Capitalization of Transamerica........... S-9
Use of Proceeds.......................... S-9
Description of the Series A Preferred
Securities............................. S-10
Description of the Series A Junior
Subordinated Debentures................ S-22
Relationship between the Series A
Preferred Securities, the Series A
Junior Subordinated Debentures and the
Guarantee.............................. S-27
United States Taxation................... S-29
Underwriting............................. S-33
Legal Matters............................ S-34
PROSPECTUS
Available Information.................... 2
Incorporation of Certain Documents by
Reference.............................. 3
Transamerica Delaware.................... 3
Transamerica Corporation................. 3
Consolidated Ratios of Earnings to Fixed
Charges and Earnings to Combined Fixed
Charges and Preferred Stock Dividends
of Transamerica........................ 4
Use of Proceeds.......................... 4
Description of the Preferred
Securities............................. 5
Description of the Guarantee............. 6
Description of the Junior Subordinated
Debentures............................. 8
Plan of Distribution..................... 13
Experts.................................. 14
Legal Opinions........................... 14
</TABLE>
================================================================================
================================================================================
PREFERRED SECURITIES
TRANSAMERICA DELAWARE
CUMULATIVE ADJUSTABLE RATE
MONTHLY INCOME PREFERRED
SECURITIES, SERIES A
GUARANTEED TO THE EXTENT
SET FORTH HEREIN BY
TRANSAMERICA CORPORATION
------------------
(LOGO)
------------------
GOLDMAN, SACHS & CO.
REPRESENTATIVES OF THE UNDERWRITERS
================================================================================
<PAGE> 69
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY
NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE
REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER
TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN
WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO
REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED OCTOBER , 1994
PROSPECTUS
$425,000,000
TRANSAMERICA CORPORATION
JUNIOR SUBORDINATED DEBENTURES
TRANSAMERICA DELAWARE
PREFERRED SECURITIES
------------------------
Transamerica Delaware, L.P. ("Transamerica Delaware"), a Delaware special
purpose limited partnership in which Transamerica Corporation, a Delaware
corporation ("Transamerica"), is the general partner, may offer, from time to
time, its preferred securities, representing limited partner interests (the
"Preferred Securities"), in one or more series. The payment of periodic cash
distributions ("dividends") with respect to Preferred Securities of any series
(if and to the extent determined to be payable ("declared") by Transamerica, in
its capacity as general partner in Transamerica Delaware) and payments on
liquidation or redemption with respect to the Preferred Securities are
guaranteed by Transamerica to the extent described herein (the "Guarantee").
Transamerica's obligations under the Guarantee are subordinate and junior in
right of payment to all other liabilities of Transamerica (except those made
pari passu (that is, equal in priority) by their terms) and senior to all
capital stock issued by Transamerica. Junior subordinated debentures of
Transamerica ("Junior Subordinated Debentures") also may be issued and sold from
time to time in one or more series by Transamerica to Transamerica Delaware in
connection with the investment of the proceeds from the offering of Preferred
Securities. The Junior Subordinated Debentures when issued will be unsecured and
subordinate and junior in right of payment to Senior Indebtedness (as defined
herein) of Transamerica. The Junior Subordinated Debentures subsequently may be
distributed pro rata to holders of Preferred Securities in connection with the
dissolution of Transamerica Delaware upon the occurrence of certain events as
may be described in an accompanying Prospectus Supplement (the "Prospectus
Supplement").
Specific terms of the particular Preferred Securities and Junior
Subordinated Debentures of any series in respect of which this Prospectus is
being delivered (the "Offered Securities") will be set forth in the accompanying
Prospectus Supplement with respect to such series, which will describe, without
limitation and where applicable, the following: (i) in the case of Preferred
Securities, the specific designation, number of Preferred Securities, dividend
rate (or the method of determining such rate), dates on which dividends will be
payable, liquidation preference, voting rights, any redemption provisions, terms
for any conversion or exchange into other securities, the initial public
offering price, any listing on a securities exchange, and any other rights,
preferences, privileges, limitations and restrictions, and (ii) in the case of
Junior Subordinated Debentures, the specific designation, aggregate principal
amount, denomination, maturity, premium, if any, interest rate (or the method of
determining such rate), if any, dates on which premium, if any, and interest, if
any, will be payable, any redemption provisions, any sinking fund provisions,
the initial public offering price, any listing on a securities exchange and any
other terms.
The Offered Securities may be offered in amounts, at prices and on terms to
be determined at the time of offering; provided, however, that the aggregate
initial public offering price of all Offered Securities shall not exceed
$425,000,000.
The Prospectus Supplement relating to any series of Offered Securities will
contain information concerning certain United States federal income tax
considerations, if applicable to the Offered Securities.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
------------------------
The Offered Securities will be sold directly, through agents, underwriters
or dealers as designated from time to time, or through a combination of such
methods. If agents or any dealers or underwriters are involved in the sale of
the Offered Securities in respect of which this Prospectus is being delivered,
the names of such agents, dealers or underwriters and any applicable commissions
or discounts will be set forth in or may be calculated from the Prospectus
Supplement with respect to such Offered Securities.
The date of this Prospectus is October , 1994.
<PAGE> 70
AVAILABLE INFORMATION
Transamerica is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith, files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). These reports, proxy
statements and other information can be inspected and copied at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Room 1024, Washington, D.C. 20549, as well as at the following Regional Offices:
7 World Trade Center, New York, New York 10048; and 500 West Madison Street,
Chicago, Illinois 60661. Copies of such material can be obtained from the Public
Reference Section of the Commission at 450 Fifth Street at prescribed rates and
can be inspected at the New York and Pacific Stock Exchanges on which certain
securities of Transamerica are listed.
This Prospectus does not contain all the information set forth in the
Registration Statement on Form S-3 (together with all amendments and exhibits
thereto, the "Registration Statement") filed by Transamerica Delaware and
Transamerica with the Commission under the Securities Act of 1933, as amended
(the "Securities Act"). Reference is made to the Registration Statement for
further information with respect to Transamerica, Transamerica Delaware and the
securities offered hereby. Statements contained or incorporated by reference
herein concerning the provisions of documents are necessarily summaries of such
documents, and each statement is qualified in its entirety by reference to the
Registration Statement.
No separate financial statements of Transamerica Delaware have been
included herein. Transamerica and Transamerica Delaware do not consider that
such financial statements would be material to holders of Preferred Securities
because Transamerica Delaware is a newly formed special purpose entity, has no
operating history, has no independent operations and is not engaged in, and does
not propose to engage in, any activity other than as set forth below. Further,
Transamerica believes that financial statements of Transamerica Delaware are not
material to the holders of the Preferred Securities since the Preferred
Securities have been structured to provide a guarantee by Transamerica of the
Preferred Securities on the terms described herein, and an agreement by
Transamerica, as general partner of Transamerica Delaware, to pay costs and
expenses of Transamerica Delaware, such that the holders of the Preferred
Securities with respect to the payment of dividends and amounts upon redemption,
dissolution, liquidation and winding-up are at least in the same position
vis-a-vis the assets of Transamerica as they would be if they were preferred
stockholders of Transamerica. See "Transamerica Delaware", "Description of the
Preferred Securities", "Description of the Guarantee" and "Description of the
Junior Subordinated Debentures". Transamerica Delaware is a limited partnership
formed under the laws of the State of Delaware. Transamerica is the sole general
partner in Transamerica Delaware and, as of the date hereof, directly or
indirectly beneficially owns all of Transamerica Delaware's partnership
interests.
2
<PAGE> 71
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
Transamerica's Annual Report on Form 10-K for the fiscal year ended
December 31, 1993 and its Quarterly Reports on Form 10-Q for the periods ended
March 31, 1994 and June 30, 1994, as filed with the Commission pursuant to the
Exchange Act, are incorporated herein by reference. All documents filed by
Transamerica pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act
subsequent to the date of this Prospectus and prior to the termination of the
offering of the securities offered hereby shall be deemed to be incorporated by
reference into this Prospectus and to be a part hereof from the date of filing
such documents. Any statement contained herein or in a document all or a portion
of which is incorporated or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document that also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
Transamerica hereby undertakes to provide without charge to each person to
whom a copy of this Prospectus has been delivered, on the written or oral
request of any such person, including any beneficial owner, a copy of any or all
of the documents referred to above which have been or may be incorporated in
this Prospectus by reference, other than exhibits to such documents unless such
exhibits are specifically incorporated by reference into the information that
the Prospectus incorporates. Requests for such copies should be directed to
Transamerica Corporation, Corporate Secretary's Office, 600 Montgomery Street,
San Francisco, California 94111, telephone (415) 983-4000.
TRANSAMERICA DELAWARE
Transamerica Delaware is a limited partnership formed under the laws of the
State of Delaware. Transamerica Delaware exists for the sole purpose of issuing
its partnership interests and investing the net proceeds thereof in Junior
Subordinated Debentures. All of its partnership interests, as of the date
hereof, are beneficially owned, directly or indirectly, by Transamerica.
Transamerica is the sole general partner in Transamerica Delaware (the "General
Partner"). Transamerica LP Holdings Corp., a Delaware corporation and
wholly-owned subsidiary of Transamerica ("Transamerica Holdings"), is, as of the
date hereof, the sole limited partner in Transamerica Delaware. Upon the
issuance of Preferred Securities, which securities represent limited partner
interests in Transamerica Delaware, Transamerica Holdings will remain as a
limited partner, but will have no interest in the profits and dividends or in
the assets of Transamerica Delaware. Transamerica Delaware has a term of
approximately 99 years, unless earlier dissolved. Transamerica Delaware's
registered office in the State of Delaware is c/o The Corporation Trust Company,
Corporation Trust Center, 1209 Orange Street, Wilmington, New Castle County,
Delaware 19801, telephone: (302) 658-7581. All of Transamerica Delaware's
business and affairs will be conducted by Transamerica, as the sole general
partner. The business address of Transamerica Delaware is c/o Transamerica
Corporation, 600 Montgomery Street, San Francisco, California 94111, telephone
(415) 983-4000.
TRANSAMERICA CORPORATION
Transamerica Corporation is a diversified financial services company, whose
core businesses include consumer lending, commercial lending, leasing, real
estate services, life insurance and asset management. Transamerica was
incorporated in Delaware in 1928. At June 30, 1994, Transamerica had
consolidated assets of $39.0 billion and total shareholders' equity of $3.1
billion. For the year ended December 31, 1993, Transamerica had revenues of $4.8
billion and net income of $377 million.
3
<PAGE> 72
Because Transamerica is a holding company, the Junior Subordinated
Debentures are effectively subordinated to all existing and future liabilities,
including trade payables, of Transamerica's subsidiaries, except to the extent
Transamerica is a creditor of the subsidiaries recognized as such.
The principal executive offices of Transamerica are located at 600
Montgomery Street, San Francisco, California 94111. Transamerica's telephone
number is (415) 983-4000.
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
AND EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDENDS OF TRANSAMERICA
The following table sets forth the consolidated ratios of earnings to fixed
charges and earnings to combined fixed charges and preferred stock dividends for
the periods indicated.
<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEARS ENDED DECEMBER 31, -------------------
-------------------------------- JUNE 30, JUNE 30,
1989 1990 1991 1992 1993 1993 1994
---- ---- ---- ---- ---- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Consolidated ratio of earnings to fixed charges
(unaudited)................................................ 1.45 1.37 1.06 1.90 2.09 2.20 2.19
Consolidated ratio of earnings to combined fixed charges and
preferred stock dividends (unaudited)...................... 1.43 1.34 1.04 1.83 2.00 2.11 2.11
</TABLE>
The consolidated ratios of earnings to fixed charges were computed by
dividing earnings before fixed charges and income taxes by the fixed charges.
The consolidated ratios of earnings to combined fixed charges and preferred
stock dividends were computed by dividing earnings before fixed charges,
preferred stock dividends and income taxes by the fixed charges and preferred
stock dividends. For computation of such ratios, earnings consist of income from
continuing operations, to which has been added fixed charges and income taxes of
Transamerica and its subsidiaries. Fixed charges consist of consolidated
interest and debt expense and one-third of consolidated rent expense, which
approximates the interest factor. Excluding the effects of a $130 million
special after tax charge recorded in the fourth quarter of 1991 by the
commercial lending operation to exit the rent-to-own finance business, reduce
lending to certain asset based lending lines, accelerate disposal of repossessed
assets and liquidate receivables remaining from previously sold businesses, the
consolidated ratio of earnings to fixed charges and ratio of earnings to
combined fixed charges and preferred stock dividends would have been 1.35 and
1.33 for 1991.
USE OF PROCEEDS
Transamerica Delaware will invest all proceeds received from the sale of
Preferred Securities in Junior Subordinated Debentures. Unless otherwise
specified in the Prospectus Supplement, the net proceeds to be received by
Transamerica from the sale of Junior Subordinated Debentures will be used for
general corporate purposes, which may include the repayment or repurchase of its
securities.
4
<PAGE> 73
DESCRIPTION OF THE PREFERRED SECURITIES
Transamerica Delaware may issue, from time to time, Preferred Securities,
in one or more series, having terms described in the Prospectus Supplement
relating thereto. The agreement of limited partnership of Transamerica Delaware
will be amended and restated (as so amended and restated, the "Limited
Partnership Agreement") to authorize the establishment of one or more series of
Preferred Securities, having such terms, including dividends, redemption,
voting, liquidation rights and such other preferred, deferred or other special
rights or such restrictions as shall be set forth therein or otherwise
established by the General Partner pursuant thereto. Reference is made to the
Prospectus Supplement relating to the Preferred Securities of a particular
series for specific terms, including (i) the distinctive designation of such
series that shall distinguish it from other series; (ii) the number of Preferred
Securities included in such series, which number may be increased or decreased
from time to time unless otherwise provided by the General Partner in creating
the series; (iii) the annual dividend rate (or method of determining such rate)
for Preferred Securities of such series and the date or dates upon which such
dividends shall be payable, provided, however, that dividends on any series of
Preferred Securities shall be payable on a monthly basis to holders of such
series of Preferred Securities as of a record date in each month during which
such series of Preferred Securities are outstanding, if and to the extent
declared by the General Partner; (iv) whether dividends on Preferred Securities
of such series shall be cumulative, and, in the case of Preferred Securities of
any series having cumulative dividend rights, the date or dates or method of
determining the date or dates from which dividends on Preferred Securities of
such series shall be cumulative; (v) the amount or amounts that shall be paid
out of the assets of Transamerica Delaware to the holders of Preferred
Securities of such series upon voluntary or involuntary dissolution, winding-up
or termination of Transamerica Delaware; (vi) the price or prices at which, the
period or periods within which, and the terms and conditions upon which,
Preferred Securities of such series may be redeemed or purchased, in whole or in
part, at the option of Transamerica Delaware or the General Partner; (vii) the
obligation, if any, of Transamerica Delaware to purchase or redeem Preferred
Securities of such series and the price or prices at which, the period or
periods within which, and the terms and conditions upon which, Preferred
Securities of such series shall be purchased or redeemed, in whole or in part,
pursuant to such obligation; (viii) the voting rights, if any, of Preferred
Securities of such series in addition to those required by law, including the
number of votes per Preferred Security and any requirement for the approval by
the holders of Preferred Securities, or of Preferred Securities of one or more
series, or of both, as a condition to specified action or amendments to the
Limited Partnership Agreement; and (ix) any other relative rights, preferences,
privileges, limitations or restrictions of Preferred Securities of the series
not inconsistent with the Limited Partnership Agreement or with applicable law.
All Preferred Securities offered hereby will be guaranteed by Transamerica to
the extent set forth below under "Description of the Guarantee". Any applicable
federal income tax considerations applicable to any offering of Preferred
Securities will be described in the Prospectus Supplement relating thereto.
5
<PAGE> 74
DESCRIPTION OF THE GUARANTEE
Set forth below is a summary of information concerning the Guarantee that
will be executed and delivered by Transamerica for the benefit of the holders
from time to time of Preferred Securities. The summary does not purport to be
complete and is subject in all respects to the provisions of, and is qualified
in its entirety by reference to, the Guarantee, which is filed as an exhibit to
the Registration Statement of which this Prospectus forms a part.
GENERAL
Pursuant to the Guarantee, Transamerica will irrevocably and
unconditionally agree, to the extent set forth therein, to pay in full, to the
holders of the Preferred Securities of each series, the Guarantee Payments (as
defined below) (without duplication of amounts theretofore paid by Transamerica
Delaware), as and when due, regardless of any defense, right of set-off or
counterclaim that Transamerica Delaware may have or assert. The following
payments with respect to any series of Preferred Securities to the extent not
paid by Transamerica Delaware (the "Guarantee Payments") will be subject to the
Guarantee (without duplication): (i) any accrued and unpaid dividends that have
theretofore been declared on the Preferred Securities of such series, (ii) the
redemption price, including all accrued and unpaid dividends (the "Redemption
Price"), with respect to any Preferred Securities called for redemption by
Transamerica Delaware and (iii) upon a liquidation of Transamerica Delaware, the
lesser of (a) the aggregate of the liquidation preference and all accrued and
unpaid dividends on the Preferred Securities of such series to the date of
payment and (b) the amount of assets of Transamerica Delaware remaining
available for distribution to holders of Preferred Securities of such series in
liquidation of Transamerica Delaware, payable in kind. Transamerica's obligation
to make a Guarantee Payment may be satisfied by direct payment of the required
amounts by Transamerica to the holders of Preferred Securities or by causing
Transamerica Delaware to pay such amounts to such holders.
If Transamerica does not make interest payments on the Junior Subordinated
Debentures purchased by Transamerica Delaware, it is expected that Transamerica
Delaware will not declare or pay dividends on the Preferred Securities. See
"Description of the Junior Subordinated Debentures -- Certain Covenants of
Transamerica". The Guarantee will be a full and unconditional guarantee with
respect to each series of Preferred Securities from the time of issuance of such
series of Preferred Securities, but will not apply to any payment of dividends
unless and until such dividends are declared.
CERTAIN COVENANTS OF TRANSAMERICA
In the Guarantee, Transamerica will covenant that, so long as any Preferred
Securities remain outstanding, Transamerica will not declare or pay any dividend
on, or purchase, acquire or make a liquidation payment with respect to, any of
its common stock or make any guarantee payment with respect thereto if at such
time Transamerica shall be in default with respect to its payment obligations
under the Guarantee or there shall have occurred any Event of Default under the
Indenture.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes that do not adversely affect the rights
of holders of Preferred Securities (in which case no consent will be required),
the Guarantee may be amended only with the prior approval of the holders of not
less than 66 2/3% in liquidation preference of the outstanding Preferred
Securities. The manner of obtaining any such approval of holders of the
Preferred Securities of each series will be as set forth in an accompanying
Prospectus Supplement. All guarantees and agreements contained in the Guarantee
shall bind the successors, assigns, receivers, trustees and representatives of
Transamerica and shall inure to the benefit of the holders of the Preferred
Securities then outstanding.
6
<PAGE> 75
TERMINATION OF THE GUARANTEE
The Guarantee will terminate and be of no further force and effect as to
the Preferred Securities of any series upon full payment of the Redemption Price
of all Preferred Securities of such series, and will terminate completely upon
full payment of the amounts payable in accordance with the Limited Partnership
Agreement upon liquidation of Transamerica Delaware. See "Description of the
Junior Subordinated Debentures -- Events of Default" for a description of the
events of default and enforcement rights of the holders of Junior Subordinated
Debentures. The Guarantee will continue to be effective or will be reinstated,
as the case may be, if at any time any holder of Preferred Securities of any
series must, in accordance with the Partnership Act, restore payment of any sums
paid under such series of Preferred Securities or the Guarantee. The Partnership
Act provides that a limited partner of a limited partnership who wrongfully
receives a distribution, may be liable to the limited partnership for the amount
of such distribution.
STATUS OF THE GUARANTEE
Transamerica's obligations under the Guarantee to make the Guarantee
Payments will constitute an unsecured obligation of Transamerica and will rank
(i) subordinate and junior in right of payment to all other liabilities of
Transamerica, including the Series A Junior Subordinated Debentures, except
those made pari passu by their terms, and (ii) senior to all capital stock now
or hereafter issued by Transamerica and to any guarantee now or hereafter
entered into by Transamerica in respect of any of its capital stock. The Limited
Partnership Agreement provides that each holder of Preferred Securities by
acceptance thereof agrees to the subordination provisions and other terms of the
Guarantee.
The Guarantee will constitute a guarantee of payment and not of collection
(that is, the guaranteed party may institute a legal proceeding directly against
guarantor to enforce its rights under the guarantee without first instituting a
legal proceeding against any other person or entity). The Guarantee will be
deposited with the General Partner to be held for the benefit of the holders of
each series of the Preferred Securities. In the event of the appointment of a
Special Representative to, among other things, enforce the Guarantee, the
Special Representative may take possession of the Guarantee for such purpose. If
no Special Representative has been appointed to enforce the Guarantee, the
General Partner has the right to enforce the Guarantee on behalf of the holders
of each series of the Preferred Securities. The holders of not less than a
majority in aggregate liquidation preference of the Preferred Securities have
the right to direct the time, method and place of conducting any proceeding for
any remedy available in respect of the Guarantee, including the giving of
directions to the General Partner or the Special Representative, as the case may
be. If the General Partner or the Special Representative fails to enforce the
Guarantee as above provided, any holder of Preferred Securities may, after a
period of 30 days has elapsed from such holder's written request to the General
Partner or the Special Representative, as the case may be, to enforce the
Guarantee, institute a legal proceeding directly against Transamerica to enforce
its rights under the Guarantee, without first instituting a legal proceeding
against Transamerica Delaware or any other person or entity. The Guarantee will
not be discharged except by payment of the Guarantee Payments in full (without
duplication of amounts theretofore paid by Transamerica Delaware).
GOVERNING LAW
The Guarantee will be governed by and construed in accordance with the laws
of the State of New York.
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DESCRIPTION OF THE JUNIOR SUBORDINATED DEBENTURES
Junior Subordinated Debentures may be issued from time to time in one or
more series under an Indenture, dated as of (the "Indenture"),
between Transamerica and The First National Bank of Chicago, as Trustee (the
"Trustee"). The following summary does not purport to be complete and is subject
in all respects to the provisions of, and is qualified in its entirety by
reference to, the Indenture, which is filed as an exhibit to the Registration
Statement of which this Prospectus forms a part. Whenever particular provisions
or defined terms in the Indenture are referred to herein, such provisions or
defined terms are incorporated by reference herein. Section and Article
references used herein are references to provisions of the Indenture unless
otherwise noted.
GENERAL
The Junior Subordinated Debentures will be unsecured, subordinated
obligations of Transamerica. The Indenture does not limit the aggregate
principal amount of Junior Subordinated Debentures that may be issued thereunder
and provides that the Junior Subordinated Debentures may be issued thereunder
from time to time in one or more series.
The Junior Subordinated Debentures are issuable in one or more series
pursuant to an indenture supplemental to the Indenture or a resolution of
Transamerica's Board of Directors or a special committee thereof (each, a
"Supplemental Indenture") (Section 2.01). The aggregate principal amount of
Junior Subordinated Debentures relating to Preferred Securities of any series
will be set forth in the Prospectus Supplement for such series and will be equal
to the sum of the aggregate liquidation preference of the Preferred Securities
for such series and the General Partner's capital contribution with respect to
the Preferred Securities for such series. Junior Subordinated Debentures
relating to Preferred Securities of any series subsequently may be distributed
pro rata to holders of Preferred Securities of such series in connection with
the dissolution of Transamerica Delaware upon the occurrence of certain events
described in the Prospectus Supplement relating to the Preferred Securities of
such series.
Reference is made to the Prospectus Supplement that will accompany this
Prospectus for the following terms of the series of Junior Subordinated
Debentures being offered thereby: (i) the specific title of such Junior
Subordinated Debentures; (ii) any limit on the aggregate principal amount of
such Junior Subordinated Debentures; (iii) the date or dates on which the
principal of such Junior Subordinated Debentures is payable; (iv) the rate or
rates at which such Junior Subordinated Debentures will bear interest or the
method of determination of such rate or rates; (v) the date or dates from which
such interest shall accrue, the interest payment dates on which such interest
will be payable or the manner of determination of such interest payment dates
and the record dates for the determination of holders to whom interest is
payable on any such interest payment dates; (vi) the right, if any, to extend
the interest payment periods and the duration of such extension; (vii) the
period or periods within which, the price or prices at which and the terms and
conditions upon which, such Junior Subordinated Debentures may be redeemed, in
whole or in part, at the option of Transamerica; (viii) the obligation, if any,
of Transamerica to redeem or purchase such Junior Subordinated Debentures
pursuant to any sinking fund or analogous provisions or at the option of the
holder thereof and the period or periods within which, the price or prices at
which, and the terms and conditions upon which, such Junior Subordinated
Debentures shall be redeemed or purchased, in whole or part, pursuant to such
obligation; (ix) the form of such Junior Subordinated Debentures; (x) if other
than denominations of $25 or any integral multiple thereof, the denominations in
which such Junior Subordinated Debentures shall be issuable; (xi) any and all
other terms with respect to such series; and (xii) whether such Junior
Subordinated Debentures are issuable as a global security, and in such case, the
identity of the depositary. (Section 2.01).
The Indenture does not contain any provisions that afford holders of Junior
Subordinated Debentures protection in the event of a highly leveraged
transaction involving Transamerica.
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SUBORDINATION
The Indenture provides that the Junior Subordinated Debentures are
subordinate and junior in right of payment to all Senior Indebtedness (as
defined below) of Transamerica as provided in the Indenture. No payment of
principal of (including redemption and sinking fund payments), premium, if any,
or interest on, the Junior Subordinated Debentures may be made if any Senior
Indebtedness is not paid when due or if the maturity of any Senior Indebtedness
has been accelerated because of a default. Upon any distribution of assets of
Transamerica to creditors upon any dissolution, winding-up, liquidation or
reorganization, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all principal of, premium, if any, and
interest due on, all Senior Indebtedness must be paid in full before the holders
of the Junior Subordinated Debentures are entitled to receive or retain any
payment. The rights of the holders of the Junior Subordinated Debentures will be
subrogated to the rights of the holders of Senior Indebtedness to receive
payments or distributions applicable to Senior Indebtedness until all amounts
owing on the Junior Subordinated Debentures are paid in full. (Sections 14.01 to
14.04).
The term "Senior Indebtedness" shall mean the principal of, premium, if
any, interest on and any other payment due pursuant to any of the following,
whether outstanding at the date of execution of the Indenture or thereafter
incurred, created or assumed:
(a) all indebtedness of Transamerica evidenced by notes, debentures,
bonds or other securities sold by Transamerica for money or other
obligations for money borrowed;
(b) all indebtedness of others of the kinds described in the preceding
clause (a) assumed by or guaranteed in any manner by Transamerica or in
effect guaranteed by Transamerica; and
(c) all renewals, extensions or refundings of indebtedness of the
kinds described in any of the preceding clauses (a) and (b);
unless, in the case of any particular indebtedness, renewal, extension or
refunding, the instrument creating or evidencing the same or the assumption or
guarantee of the same expressly provides that such indebtedness, renewal,
extension or refunding is not superior in right of payment to or is pari passu
with the Junior Subordinated Debentures. Such Senior Indebtedness shall continue
to be Senior Indebtedness and entitled to the benefits of the subordination
provisions irrespective of any amendment, modification or waiver of any term of
such Senior Indebtedness. (Section 1.01).
The Indenture does not limit the aggregate amount of Senior Indebtedness
that may be issued. As of August 31, 1994, Senior Indebtedness of Transamerica
(on an unconsolidated basis) aggregated approximately $730 million, all of which
is unsecured. Because Transamerica is a holding company, the Junior Subordinated
Debentures are also effectively subordinated to all existing and future
liabilities, including trade payables, of Transamerica's subsidiaries, except to
the extent Transamerica is a creditor of the subsidiaries recognized as such.
CERTAIN COVENANTS OF TRANSAMERICA
Pursuant to the Indenture, Transamerica will covenant that it will not
declare or pay any dividend on, or purchase, acquire or make a distribution or
liquidation payment with respect to, any of its common stock, if at such time
(i) there shall have occurred any event that would constitute an Event of
Default under the Indenture, (ii) Transamerica shall be in default with respect
to its payment of any obligations under the Guarantee or (iii) Transamerica
shall have given notice of its selection of an extended interest payment period
as provided in the Indenture and such period, or any extension thereof, shall be
continuing. (Section 4.06). Transamerica will also covenant (i) to remain the
sole general partner of Transamerica Delaware and maintain 100% ownership of the
general partner interests thereof; provided that any permitted successor of
Transamerica under the Indenture may succeed to Transamerica's duties as General
Partner, (ii) to contribute capital to the extent required to maintain its
capital at an amount equal to at least 3% of the total capital contributions to
Transamerica Delaware, (iii) not to voluntarily dissolve, wind-up or terminate
Transamerica Dela-
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<PAGE> 78
ware, except in connection with the distribution of Junior Subordinated
Debentures to the holders of Preferred Securities in liquidation of Transamerica
Delaware and in connection with certain mergers, consolidations or amalgamations
permitted by the Limited Partnership Agreement, (iv) to perform all of its
duties as the general partner in Transamerica Delaware in a timely manner and
(v) to use its reasonable efforts to cause Transamerica Delaware to remain a
limited partnership and otherwise continue to be treated as a partnership for
United States federal income tax purposes. (Section 4.07).
FORM, EXCHANGE, REGISTRATION AND TRANSFER
Junior Subordinated Debentures of each series will be issued in registered
form and in either certificated form or will be represented by one or more
global securities. If not represented by one or more global securities, Junior
Subordinated Debentures may be presented for registration of transfer (with the
form of transfer endorsed thereon duly executed) or exchange, at the office of
the Debenture Registrar or at the office of any transfer agent designated by
Transamerica for such purpose with respect to any series of Junior Subordinated
Debentures and referred to in an applicable Prospectus Supplement, without
service charge and upon payment of any taxes and other governmental charges as
described in the Indenture. Such transfer or exchange will be effected upon the
Debenture Registrar or such transfer agent, as the case may be, being satisfied
with the documents of title and identity of the person making the request.
Transamerica has appointed the Trustee as Debenture Registrar with respect to
the Junior Subordinated Debentures. (Section 2.05). If a Prospectus Supplement
refers to any transfer agents (in addition to the Debenture Registrar) initially
designated by Transamerica with respect to any series of Junior Subordinated
Debentures, Transamerica may at any time rescind the designation of any such
transfer agent or approve a change in the location through which any such
transfer agent acts, except that Transamerica will be required to maintain a
transfer agent in each Place of Payment for such series. (Section 4.02).
Transamerica may at any time designate additional transfer agents with respect
to any series of Junior Subordinated Debentures.
In the event of any redemption in part, Transamerica shall not be required
to (i) issue, register the transfer of or exchange any Junior Subordinated
Debenture during a period beginning at the opening of business 15 days before
any selection for redemption of Junior Subordinated Debentures of like tenor and
of the series of which such Junior Subordinated Debenture is a part, and ending
at the close of business on the earliest date in which the relevant notice of
redemption is deemed to have been given to all holders of Junior Subordinated
Debentures of like tenor and of such series to be redeemed and (ii) register the
transfer of or exchange any Junior Subordinated Debentures so selected for
redemption, in whole or in part, except the unredeemed portion of any Junior
Subordinated Debenture being redeemed in part. (Section 2.05).
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in an applicable Prospectus Supplement, payment
of principal of and premium (if any) on any Junior Subordinated Debenture will
be made only against surrender to the Paying Agent of such Junior Subordinated
Debenture. Unless otherwise indicated in an applicable Prospectus Supplement,
principal of and any premium and interest, if any, on Junior Subordinated
Debentures will be payable, subject to any applicable laws and regulations, at
the office of such Paying Agent or Paying Agents as Transamerica may designate
from time to time, except that at the option of Transamerica payment of any
interest may be made by check mailed to the address of the person entitled
thereto as such address shall appear in the Debenture Register with respect to
such Junior Subordinated Debentures. Unless otherwise indicated in an applicable
Prospectus Supplement, payment of interest on a Junior Subordinated Debenture on
any Interest Payment Date will be made to the person in whose name such Junior
Subordinated Debenture (or Predecessor Security) is registered at the close of
business on the Regular Record Date for such interest payment. (Section 2.03).
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Transamerica will act as Paying Agent with respect to the Junior
Subordinated Debentures. Transamerica may at any time designate additional
Paying Agents or rescind the designation of any Paying Agents or approve a
change in the office through which any Paying Agent acts, except that
Transamerica will be required to maintain a Paying Agent in each Place of
Payment for each series of the Junior Subordinated Debentures. (Sections 4.02
and 4.03).
All moneys paid by Transamerica to a Paying Agent for the payment of the
principal of or premium or interest, if any, on any Junior Subordinated
Debenture of any series that remain unclaimed at the end of two years after such
principal, premium, if any, or interest shall have become due and payable will
be repaid to Transamerica and the holder of such Junior Subordinated Debenture
will thereafter look only to Transamerica for payment thereof. (Section 11.05).
GLOBAL DEBENTURES
If any Junior Subordinated Debentures of a series are represented by one or
more global securities, the applicable Prospectus Supplement will describe the
circumstances, if any, under which beneficial owners of interests in any such
Global Debenture may exchange such interests for Junior Subordinated Debentures
of such series and of like tenor and principal amount in any authorized form and
denomination. Principal of and any premium and interest on a Global Debenture
will be payable in the manner described in the applicable Prospectus Supplement.
(Section 2.11).
The specific terms of the depository arrangement with respect to any
portion of a series of Junior Subordinated Debentures to be represented by a
Global Debenture will be described in the applicable Prospectus Supplement.
MODIFICATION OF THE INDENTURE
The Indenture contains provisions permitting Transamerica and the Trustee,
with the consent of the holders of not less than a majority in principal amount
of the Junior Subordinated Debentures of each series that are affected by the
modification, to modify the Indenture or any supplemental indenture affecting
that series or the rights of the holders of that series of Junior Subordinated
Debentures; provided, that no such modification may, without the consent of the
holder of each outstanding Junior Subordinated Debenture affected thereby, (i)
extend the fixed maturity of any Junior Subordinated Debentures of any series,
or reduce the principal amount thereof, or reduce the rate or extend the time of
payment of interest thereon, or reduce any premium payable upon the redemption
thereof, without the consent of the holder of each Junior Subordinated Debenture
so affected or (ii) reduce the percentage of Junior Subordinated Debentures, the
holders of which are required to consent to any such supplemental indenture,
without the consent of the holders of each Junior Subordinated Debenture then
outstanding and affected thereby. (Section 9.02).
In addition, Transamerica and the Trustee may execute, without the consent
of any holder of Junior Subordinated Debentures, any supplemental indenture for
certain other usual purposes including the creation of any new series of Junior
Subordinated Debentures. (Sections 2.01, 9.01 and 10.01).
EVENTS OF DEFAULT
The Indenture provides that any one or more of the following described
events, which has occurred and is continuing, constitutes an "Event of Default"
with respect to each series of Junior Subordinated Debentures:
(a) failure for 10 days to pay interest on the Junior Subordinated
Debentures of that series when due; provided that a valid extension of the
interest payment period by Transamerica shall not constitute a default in
the payment of interest for this purpose; or
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<PAGE> 80
(b) failure to pay principal or premium, if any, on the Junior
Subordinated Debentures of that series when due whether at maturity, upon
redemption, by declaration or otherwise, or to make any required sinking
fund payment with respect to that series; or
(c) failure to observe or perform any other covenant (other than those
specifically relating to another series) contained in the Indenture for 90
days after written notice to Transamerica from the Trustee or the holders
of at least 25% in principal amount of the outstanding Junior Subordinated
Debentures of that series; or
(d) the dissolution, winding-up or termination of Transamerica
Delaware, except in connection with the distribution of Junior Subordinated
Debentures to the holders of Preferred Securities in liquidation of
Transamerica Delaware and in connection with certain mergers,
consolidations or amalgamations permitted by the Limited Partnership
Agreement; or
(e) certain events in bankruptcy, insolvency or reorganization of
Transamerica. (Section 6.01).
The holders of a majority in aggregate outstanding principal amount of any
series of the Junior Subordinated Debentures have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee for that series. (Section 6.06). The Trustee or the holders of not less
than 25% in aggregate outstanding principal amount of any particular series of
the Junior Subordinated Debentures may declare the principal due and payable
immediately upon an Event of Default with respect to such series, but the
holders of a majority in aggregate outstanding principal amount of such series
may annul such declaration and waive the default with respect to such series if
the default has been cured and a sum sufficient to pay all matured installments
of interest and principal otherwise than by acceleration and any premium has
been deposited with the Trustee. (Sections 6.01 and 6.06).
The holders of a majority in aggregate outstanding principal amount of any
series of the Junior Subordinated Debentures affected thereby may, on behalf of
the holders of all the Junior Subordinated Debentures of such series, waive any
past default, except a default in the payment of principal, premium, if any, or
interest (unless such default has been cured and a sum sufficient to pay all
matured installments of interest and principal otherwise than by acceleration
and any premium has been deposited with the Trustee) or a call for redemption of
Junior Subordinated Debentures of such series. (Section 6.06). Transamerica is
required to file annually with the Trustee a certificate as to whether or not
Transamerica is in compliance with all the conditions and covenants under the
Indenture. (Section 5.03(d)).
CONSOLIDATION, MERGER AND SALE
The Indenture does not contain any covenant that restricts Transamerica's
ability to merge or consolidate with or into any other corporation, sell or
convey all or substantially all of its assets to any person, firm or corporation
or otherwise engage in restructuring transactions. (Section 10.01).
DEFEASANCE AND DISCHARGE
Under the terms of the Indenture, Transamerica will be discharged from any
and all obligations in respect of the Junior Subordinated Debentures of any
series (except in each case for certain obligations to register the transfer or
exchange of Junior Subordinated Debentures, replace stolen, lost or mutilated
Junior Subordinated Debentures, maintain paying agencies and hold moneys for
payment in trust) if Transamerica deposits with the Trustee, in trust, moneys or
Government Obligations, in an amount sufficient to pay all the principal of, and
interest on, the Junior Subordinated Debentures of such series on the dates such
payments are due in accordance with the terms of such Junior Subordinated
Debentures. (Sections 11.01 and 11.02).
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GOVERNING LAW
The Indenture and the Junior Subordinated Debentures will be governed by,
and construed in accordance with, the laws of the State of New York. (Section
13.05).
INFORMATION CONCERNING THE TRUSTEE
The Trustee, prior to default, undertakes to perform only such duties as
are specifically set forth in the Indenture and, after default, shall exercise
the same degree of care as a prudent individual would exercise in the conduct of
his or her own affairs. (Section 7.01). Subject to such provision, the Trustee
is under no obligation to exercise any of the powers vested in it by the
Indenture at the request of any holder of Junior Subordinated Debentures, unless
offered reasonable indemnity by such holder against the costs, expenses and
liabilities that might be incurred thereby. (Section 7.02). The Trustee is not
required to expand or risk its own funds or otherwise incur personal financial
liability in the performance of its duties if the Trustee reasonably believes
that repayment or adequate indemnity is not reasonably assured to it. (Section
7.01).
Transamerica has a credit relationship with the Trustee. The Trustee also
serves as transfer agent and registrar for Transamerica's common stock and 8.5%
Series D Preferred Stock. In addition, the Trustee serves as trustee for
asset-backed certificates issued by one of Transamerica's subsidiaries.
MISCELLANEOUS
Transamerica will have the right at all times to assign any of its rights
or obligations under the Indenture to a direct or indirect wholly-owned
subsidiary of Transamerica; provided, that, in the event of any such assignment,
Transamerica will remain liable for all such obligations. Subject to the
foregoing, the Indenture will be binding upon and inure to the benefit of the
parties thereto and their respective successors and assigns. The Indenture
provides that it may not otherwise be assigned by the parties thereto. (Section
13.11).
PLAN OF DISTRIBUTION
Transamerica Delaware may sell any series of Preferred Securities being
offered hereby in one or more of the following ways from time to time: (i) to
underwriters for resale to the public or to institutional investors; (ii)
directly to institutional investors; or (iii) through agents to the public or to
institutional investors. The Prospectus Supplement with respect to each series
of Offered Securities will set forth the terms of the offering of such Offered
Securities, including the name or names of any underwriters or agents, the
purchase price of such Offered Securities and the proceeds to Transamerica
Delaware from such sale, any underwriting discounts or agency fees and other
items constituting underwriters' or agents' compensation, any initial public
offering price, any discounts or concessions allowed or reallowed or paid to
dealers and any securities exchanges on which such Offered Securities may be
listed.
If underwriters participate in the sale, such Offered Securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
Unless otherwise set forth in the Prospectus Supplement, the obligations of
the underwriters to purchase any series of Offered Securities will be subject to
certain conditions precedent and the underwriters will be obligated to purchase
all of such series of Offered Securities, if any are purchased. In the event of
a default of one or more of the underwriters involving not more than one-
eleventh of the aggregate number or aggregate principal amount of Offered
Securities offered for sale, the non-defaulting underwriters would be required
to purchase the Offered Securities agreed to be purchased by such defaulting
underwriter or underwriters. In the event of a default in excess of
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<PAGE> 82
one-eleventh of the aggregate number or aggregate principal amount of Offered
Securities, then Transamerica Delaware may, at its option, sell to the
non-defaulting underwriters, and the non-defaulting underwriters may, at their
option, purchase, all of the Offered Securities that such underwriters had
committed to purchase.
Underwriters and agents may be entitled under agreements entered into with
Transamerica and/or Transamerica Delaware to indemnification by Transamerica
and/or Transamerica Delaware against certain civil liabilities, including
liabilities under the Securities Act of 1933, or to contribution with respect to
payments that the underwriters or agents may be required to make in respect
thereof. Underwriters and agents may be customers of, engage in transactions
with, or perform services for Transamerica in the ordinary course of business.
Each series of Offered Securities will be a new issue of securities and
will have no established trading market. Any underwriters to whom Offered
Securities are sold by Transamerica Delaware for public offering and sale may
make a market in such Offered Securities, but such underwriters will not be
obligated to do so and may discontinue any market making at any time without
notice. The Offered Securities may or may not be listed on a national securities
exchange.
EXPERTS
The consolidated financial statements of Transamerica Corporation appearing
in Transamerica Corporation's Annual Report on Form 10-K for the year ended
December 31, 1993, have been audited by Ernst & Young LLP, independent auditors,
as set forth in their report thereon included therein and incorporated herein by
reference, which is based in part on the report of Coopers & Lybrand,
independent auditors for Sedgwick Group plc. The financial statements referred
to above are included in reliance upon such reports given upon the authority of
such firms as experts in accounting and auditing.
LEGAL OPINIONS
Certain legal matters in connection with the Offered Securities will be
passed upon for Transamerica and Transamerica Delaware by Christopher M. McLain,
Senior Vice President and General Counsel of Transamerica, and for the
purchasers or underwriters by Cleary, Gottlieb, Steen & Hamilton, New York, New
York. Certain matters of Delaware law relating to the validity of the Series A
Preferred Securities, the validity of the Limited Partnership Agreement and the
formation of Transamerica Delaware will be passed upon by Richards, Layton &
Finger, P.A., Wilmington, Delaware, as special Delaware counsel for Transamerica
and Transamerica Delaware. As of October 7, 1994, Mr. McLain was the beneficial
owner of 990 shares of Transamerica common stock.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
An itemized statement of the estimated amount of the expenses, other than
underwriting discounts and commissions, incurred and to be incurred by
Transamerica Corporation in connection with the issuance and distribution of the
securities registered pursuant to this registration statement is as follows:
<TABLE>
<S> <C>
Securities and Exchange Commission filing fee........................... $ 146,552
Printing and engraving expenses......................................... 265,000*
Accounting fees and expenses............................................ 20,000*
Legal fees and expenses................................................. 250,000*
Listing fees............................................................ 45,000*
Fees and expenses of Trustee............................................ 8,500*
Rating agencies' fees................................................... 350,000*
Blue sky fees and expenses, and legal fees.............................. 25,000*
Miscellaneous........................................................... 9,948*
TOTAL......................................................... $1,120,000*
----------
</TABLE>
--------------------
* Estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Transamerica Corporation (the "Company") is a Delaware corporation. The
Company's Bylaws provide, in effect, that, to the extent and under the
circumstances permitted by Section 145 of the General Corporation Law of the
State of Delaware, the Company shall indemnify any person who was or is a party
or is threatened to be made a party to any action, suit or proceeding of the
type described in that section by reason of the fact that he or she is or was a
director or officer of the Company.
Section 145 of the General Corporation Law of Delaware empowers a
corporation to indemnify any person who was or is a party or is threatened to be
made a party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than in certain
actions by or in the right of the corporation as described below), by reason of
the fact that he or she is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership or
other enterprise, against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by such person
in connection with such action, suit or proceeding if such person acted in good
faith and in a manner he or she reasonably believed to be in or not opposed to
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe that his or her conduct was
unlawful. In the case of an action by or in the right of the corporation, no
indemnification shall be made in respect to any claim, issue or matter as to
which such person shall have been adjudged to be liable to the corporation for
negligence or misconduct in the performance of his or her duty to the
corporation unless and only to the extent that the Court of Chancery or the
court in which such action or suit was brought shall determine that, despite the
adjudication of liability but in view of all the circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such expenses which
such court shall deem proper. Section 145 further provides that to the extent
that such director, officer, employee or agent of a corporation has been
successful in the defense of any action, suit or proceeding referred to above or
in the defense of any claim, issue or matter therein,
II-1
<PAGE> 84
such person shall be indemnified against expenses (including attorneys' fees)
actually and reasonably incurred by him or her in connection therewith.
The Company's Certificate of Incorporation relieves its directors from
monetary damages to the Company or its stockholders for any breach of such
director's fiduciary duty as a director to the extent permitted by the Delaware
General Corporation Law. Under Section 102(b)(7) of the Delaware General
Corporation Law, a corporation may relieve its directors from personal liability
to such corporation or its stockholders for monetary damages for any breach of
their fiduciary duty as directors except (i) for a breach of a director's duty
of loyalty to the corporation or its stockholders, (ii) for any act or omission
not in good faith, (iii) for any intentional misconduct or knowing violation of
law, (iv) for any willful or negligent violation of certain provisions of the
Delaware General Corporation Law imposing certain requirements with respect to
stock repurchases, redemptions and payment of dividends or (v) for any
transaction from which the director derived an improper personal benefit.
II-2
<PAGE> 85
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO. DOCUMENT
------ ----------------------------------------------------------------------------------
<C> <S>
1.1 Form of Underwriting Agreement.*
4.1 Form of Indenture between Transamerica and The First National Bank of Chicago, as
Trustee.**
4.2 Form of Supplemental Indenture to Indenture to be used in connection with the
issuance of Junior Subordinated Debentures and fixed rate Preferred Securities.**
4.3 Form of Supplemental Indenture to Indenture to be used in connection with the
issuance of Junior Subordinated Debentures and adjustable rate Preferred
Securities.**
4.4 Certificate of Limited Partnership of Transamerica Delaware.**
4.5 Form of Amended and Restated Agreement of Limited Partnership of Transamerica
Delaware.
4.6 Form of Preferred Security (included in Exhibit 4.5 above).
4.7 Form of Junior Subordinated Debenture (included in Exhibit 4.2).**
4.8 Form of Guarantee Agreement with respect to Preferred Securities.**
4.9 Form of Action of General Partner of Transamerica Delaware creating the Fixed Rate
Preferred Securities.
4.10 Form of Action of General Partner of Transamerica Delaware creating the Adjustable
Rate Preferred Securities.
5.1 Opinion of Christopher M. McLain.
5.2 Opinion of Richards, Layton & Finger, P.A.
8.1 Opinion of Wachtell, Lipton, Rosen & Katz.
12.1 Computations of consolidated ratio of earnings to fixed charges and consolidated
ratio of earnings to combined fixed charges and preferred stock dividends.**
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Coopers & Lybrand.
23.3 Consent of Christopher M. McLain (included in Exhibit 5.1 above).
23.4 Consent of Wachtell, Lipton, Rosen & Katz (included in Exhibit 8.1 above).
23.5 Consent of Richards, Layton & Finger, P.A. (included in Exhibit 5.2 above).
24.1 Powers of Attorney.**
25.1 Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of The
First National Bank of Chicago, as Trustee under the Indenture.**
99.1 Audit Report of Coopers & Lybrand on Financial Statements of Sedgwick Group plc
for the year ended 31 December 1992.**
99.2 Audit Report of Coopers & Lybrand on Financial Statements of Sedgwick Group plc
for the year ended 31 December 1993.**
* To be filed by amendment.
** Previously filed.
</TABLE>
II-3
<PAGE> 86
ITEM 17. UNDERTAKINGS
(a) The undersigned Registrants hereby undertake:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement; and
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement;
provided, however, that the undertakings set forth in paragraph (a)(1)(i)
and (a)(1)(ii) above do not apply if the information required to be
included in a post-effective amendment by those paragraphs is contained in
periodic reports filed by Transamerica pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934 that are incorporated by reference in
the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrants hereby undertake that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
Transamerica's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers or persons controlling the
Registrants pursuant to the provision described under Item 15 above, or
otherwise, the Registrants have been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by the Registrants of expenses incurred or paid by a director,
officer or controlling person of the Registrants in the successful defense of
any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Registrants will, unless in the opinion of their counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by them is against public policy as
expressed in the Securities Act of 1933 and will be governed by the final
adjudication of such issue.
II-4
<PAGE> 87
SIGNATURES
Pursuant to requirements of the Securities Act of 1933, Transamerica
Corporation certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of San Francisco and State of California on the 7th
day of October 1994.
TRANSAMERICA CORPORATION
By /s/ CHRISTOPHER M. MCLAIN
-----------------------------------
Christopher M. McLain
Senior Vice President and General
Counsel
Pursuant to the requirements of the Securities Act of 1933, Transamerica
Delaware, L.P. certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of San Francisco and State of California, on the
7th day of October 1994.
TRANSAMERICA DELAWARE, L.P.
BY: TRANSAMERICA CORPORATION,
GENERAL PARTNER
By /s/ CHRISTOPHER M. MCLAIN
------------------------------------
Christopher M. McLain
Senior Vice President and General
Counsel
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following directors and
officers of Transamerica Corporation in the capacities and on the dates
indicated.
<TABLE>
<S> <C>
Principal executive officer:
Date: October 7, 1994 By /s/ FRANK C. HERRINGER
-----------------------------------------
(Frank C. Herringer)
President, Chief Executive Officer and
Director
Principal financial officer:
Date: October 7, 1994 By /s/ EDGAR H. GRUBB
-----------------------------------------
(Edgar H. Grubb)
Executive Vice President and Chief
Financial Officer
</TABLE>
II-5
<PAGE> 88
<TABLE>
<S> <C>
Principal accounting officer:
Date: October 7, 1994 By /s/ BURTON E. BROOME
---------------------------------------------
(Burton E. Broome)
Vice President and Controller
Directors:
Date: October 7, 1994 By
*
-----------------------------------------
(Myron DuBain)
Date: October 7, 1994 By
*
-----------------------------------------
(Samuel L. Ginn)
Date: October 7, 1994 By
*
-----------------------------------------
(James R. Harvey)
Chairman of the Board
Date: October 7, 1994 By
*
-----------------------------------------
(Gordon E. Moore)
Date: October 7, 1994 By
*
-----------------------------------------
(Raymond F. O'Brien)
Date: October 7, 1994 By
*
-----------------------------------------
(Condoleeza Rice)
Date: October 7, 1994 By
*
-----------------------------------------
(Charles R. Schwab)
Date: October 7, 1994 By
*
-----------------------------------------
(Forrest R. Shumway)
Date: October 7, 1994 By
*
-----------------------------------------
(Peter V. Ueberroth)
*By /s/ CHRISTOPHER M. MCLAIN
----------------------------------------
Christopher M. McLain
As attorney-in-fact
</TABLE>
II-6
<PAGE> 89
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NO. DOCUMENT PAGE
------ ----------------------------------------------------------------------------- ----
<S> <C> <C>
1.1 Form of Underwriting Agreement*
4.1 Form of Indenture between Transamerica and The First National Bank of
Chicago, as Trustee**........................................................
4.2 Form of Supplemental Indenture to Indenture to be used in connection with the
issuance of Junior Subordinated Debentures and fixed rate Preferred
Securities**.................................................................
4.3 Form of Supplemental Indenture to Indenture to be used in connection with the
issuance of Junior Subordinated Debentures and adjustable rate Preferred
Securities**.................................................................
4.4 Certificate of Limited Partnership of Transamerica Delaware**................
4.5 Form of Amended and Restated Agreement of Limited Partnership of Transamerica
Delaware.....................................................................
4.6 Form of Preferred Security (included in Exhibit 4.5 above)...................
4.7 Form of Junior Subordinated Debenture (included in Exhibit 4.2)**............
4.8 Form of Guarantee Agreement with respect to Preferred Securities**...........
4.9 Form of Action of General Partner of Transamerica Delaware creating the Fixed
Rate Preferred Securities....................................................
4.10 Form of Action of General Partner of Transamerica Delaware creating the
Adjustable Rate Preferred Securities.........................................
5.1 Opinion of Christopher M. McLain.............................................
5.2 Opinion of Richards, Layton & Finger, P.A....................................
8.1 Opinion of Wachtell, Lipton, Rosen & Katz....................................
12.1 Computations of consolidated ratio of earnings to fixed charges and
consolidated ratio of earnings to combined fixed charges and preferred stock
dividends**..................................................................
23.1 Consent of Ernst & Young LLP.................................................
23.2 Consent of Coopers & Lybrand.................................................
23.3 Consent of Christopher M. McLain (included in Exhibit 5.1 above).............
23.4 Consent of Wachtell, Lipton, Rosen & Katz (included in Exhibit 8.1 above)....
23.5 Consent of Richards, Layton & Finger, P.A. (included in Exhibit 5.2 above)...
24.1 Powers of Attorney**.........................................................
25.1 Statement of Eligibility under the Trust Indenture Act of 1939, as amended,
of The First National Bank of Chicago, as Trustee under the Indenture**......
99.1 Audit Report of Coopers & Lybrand on Financial Statements of Sedgwick Group
plc for the year ended 31 December 1992**....................................
99.2 Audit Report of Coopers & Lybrand on Financial Statements of Sedgwick Group
plc for the year ended 31 December 1993**....................................
* To be filed by amendment.
** Previously filed
</TABLE>
<PAGE> 1
(WLRK Draft -- 10/5/94)
EXHIBIT 4.5
AMENDED AND RESTATED AGREEMENT
OF
LIMITED PARTNERSHIP
OF
TRANSAMERICA DELAWARE, L.P.
<PAGE> 2
TABLE OF CONTENTS
ARTICLE I
FORMATION AND CONTINUATION OF THE PARTNERSHIP;
ADMISSION OF PREFERRED SECURITY HOLDERS;
RETURN OF INITIAL LIMITED PARTNER'S CAPITAL CONTRIBUTION
<TABLE>
<S> <C>
Section 1.1 Formation and Continuation of the
Partnership................................... 1
Section 1.2 Name.......................................... 2
Section 1.3 Business of the Partnership................... 2
Section 1.4 Term.......................................... 2
Section 1.5 Registered Agent and Office................... 2
Section 1.6 Principal Place of Business................... 3
Section 1.7 Name and Business Address of General
Partner....................................... 3
Section 1.8 Admission of Holders of Preferred Securities.. 3
ARTICLE II
DEFINED TERMS
Section 2.1 Definitions................................... 4
ARTICLE III
CAPITAL CONTRIBUTIONS, REPRESENTATION OF
PREFERRED SECURITY HOLDER'S INTEREST; CAPITAL ACCOUNTS
Section 3.1 Capital Contributions......................... 9
Section 3.2 Preferred Security Holder's Interest
Represented by Preferred Securities........... 10
Section 3.3 Capital Accounts.............................. 10
Section 3.4 Interest on Capital Contributions............. 10
Section 3.5 Withdrawal and Return of Capital
Contributions................................. 10
ARTICLE IV
ALLOCATIONS
Section 4.1 Profits and Losses............................ 11
Section 4.2 Other Allocation Provisions................... 12
Section 4.3 Allocations for Income Tax Purposes........... 14
Section 4.4 Withholding................................... 14
ARTICLE V
DIVIDENDS
Section 5.1 Dividends..................................... 15
Section 5.2 Limitations on Distributions.................. 15
</TABLE>
-i-
<PAGE> 3
ARTICLE VI
ISSUANCE OF PREFERRED SECURITIES
<TABLE>
<S> <C>
Section 6.1 General Provisions Regarding Preferred
Securities.................................... 15
ARTICLE VII
BOOKS OF ACCOUNT, RECORDS AND REPORTS
Section 7.1 Books and Records............................. 19
Section 7.2 Accounting Method............................. 20
ARTICLE VIII
POWERS, RIGHTS AND DUTIES
OF THE LIMITED PARTNERS
Section 8.1 Limitations................................... 20
Section 8.2 Liability..................................... 21
Section 8.3 Priority...................................... 21
ARTICLE IX
POWERS, RIGHTS AND DUTIES
OF THE GENERAL PARTNER
Section 9.1 Authority..................................... 21
Section 9.2 Powers and Duties of General Partner.......... 21
Section 9.3 Liability..................................... 23
Section 9.4 Exculpation................................... 23
Section 9.5 Fiduciary Duty................................ 23
Section 9.6 Indemnification............................... 24
Section 9.7 Outside Businesses............................ 25
Section 9.8 Limits on General Partner's Powers............ 25
Section 9.9 Tax Matters Partner........................... 26
Section 9.10 Expenses...................................... 26
ARTICLE X
TRANSFERS OF INTERESTS BY PARTNERS
Section 10.1 Transfer of Interests......................... 27
Section 10.2 Transfer of LP Certificates................... 27
Section 10.3 Persons Deemed Preferred Security Holders..... 28
Section 10.4 Book Entry Interests.......................... 28
Section 10.5 Notices to Clearing Agency.................... 29
Section 10.6 Appointment of Successor Clearing Agency...... 29
Section 10.7 Definitive LP Certificates; Appointment
of Paying Agent(s).......................... 29
</TABLE>
-ii-
<PAGE> 4
ARTICLE XI
<TABLE>
WITHDRAWAL; DISSOLUTION; LIQUIDATION AND DISTRIBUTION OF ASSETS
<S> <C>
Section 11.1 Withdrawal of Partners........................ 30
Section 11.2 Dissolution of the Partnership................ 30
Section 11.3 Liquidation................................... 32
Section 11.4 Distribution in Liquidation................... 32
Section 11.5 Rights of Limited Partners.................... 33
Section 11.6 Termination................................... 33
ARTICLE XII
AMENDMENTS AND MEETINGS
Section 12.1 Amendments.................................... 33
Section 12.2 Amendment of Certificate...................... 33
Section 12.3 Meetings of the Partners...................... 33
ARTICLE XIII
MISCELLANEOUS
Section 13.1 Notices....................................... 35
Section 13.2 Entire Agreement.............................. 36
Section 13.3 Governing Law................................. 36
Section 13.4 Effect........................................ 36
Section 13.5 Pronouns and Number........................... 36
Section 13.6 Captions and Headings......................... 36
Section 13.7 Partial Enforceability........................ 36
Section 13.8 Counterparts.................................. 36
Section 13.9 Waiver of Partition........................... 36
Section 13.10 Remedies...................................... 37
</TABLE>
-iii-
<PAGE> 5
AMENDED AND RESTATED AGREEMENT
OF LIMITED PARTNERSHIP
OF
TRANSAMERICA DELAWARE, L.P.
AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP
of Transamerica Delaware, L.P. (the "Partnership"), dated as of
_____ __, 1994, among Transamerica Corporation, a Delaware
corporation ("Transamerica"), as the general partner, Trans-
america LP Holdings Corp., a Delaware corporation, as the ini-
tial limited partner (the "Initial Limited Partner") and such
other Persons (as defined herein) who become Limited Partners
(as defined herein) as provided herein.
WHEREAS, Transamerica and the Initial Limited Partner
entered into an Agreement of Limited Partnership, dated as of
August 9, 1994 (the "Original Limited Partnership Agreement");
WHEREAS, the Certificate of Limited Partnership of
the Partnership was filed with the Office of the Secretary of
State of the State of Delaware on August 9, 1994;
WHEREAS, the Partners (as defined herein) desire to
continue the Partnership as a limited partnership under the Act
(as defined herein) and to amend and restate the Original Lim-
ited Partnership Agreement in its entirety;
NOW, THEREFORE, in consideration of the agreements
and obligations set forth herein and for other good and valu-
able consideration, receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree to amend and restate the
Original Limited Partnership Agreement in its entirety and
hereby agree as follows:
ARTICLE I
FORMATION AND CONTINUATION OF THE PARTNERSHIP;
ADMISSION OF PREFERRED SECURITY HOLDERS;
RETURN OF INITIAL LIMITED PARTNER'S CAPITAL CONTRIBUTION
Section 1.1 Formation and Continuation of the Part-
nership. The Partnership was formed as a limited partnership
under the Act by the filing by the General Partner (as defined
herein) of the Certificate (as defined herein) with the Office
of the Secretary of State of the State of Delaware on August 9,
<PAGE> 6
1994 and the entering into by the General Partner and the Ini-
tial Limited Partner of the Original Limited Partnership Agree-
ment. The parties hereto agree to continue the Partnership as
a limited partnership under the Act. The General Partner, for
itself and as agent for the Limited Partners, shall make every
reasonable effort to assure that all certificates and docu-
ments are properly executed and shall accomplish all filing,
recording, publishing and other acts necessary or appropriate
for compliance with all the requirements for the continuation
of the Partnership as a limited partnership under the Act and
under all other laws of the State of Delaware or such other
jurisdictions in which the General Partner determines that the
Partnership may conduct business. The rights, liabilities and
duties of the Partners shall be as provided in the Act except
as modified by this Agreement. Where not otherwise specified
in this Agreement, the Act governs the rights and obligations
of the parties to this Agreement.
Section 1.2 Name. The name of the Partnership is
"Transamerica Delaware, L.P.", as such name may be modified
from time to time by the General Partner following written
notice to the Limited Partners. The Partnership business may
be conducted under the name of the Partnership or any other
name deemed advisable by the General Partner.
Section 1.3 Business of the Partnership. The sole
purpose of the Partnership is (a) to issue partnership inter-
ests in the Partnership, including, without limitation, Pre-
ferred Securities (as defined herein), and to use the proceeds
thereof to purchase Junior Subordinated Debentures (as defined
herein) or other similar debt instruments of Transamerica and
(b) except as otherwise limited herein, to enter into, make and
perform all contracts and other undertakings, and engage in all
activities and transactions as the General Partner may rea-
sonably deem necessary or advisable for the carrying out of the
foregoing purpose of the Partnership.
Section 1.4 Term. The term of the Partnership com-
menced on the date the Certificate was filed with the Secretary
of State of the State of Delaware and shall continue until
December 31, 2093, unless dissolved before such date in accor-
dance with the provisions of this Agreement.
Section 1.5 Registered Agent and Office. The Part-
nership's registered agent and office in the State of Delaware
shall be The Corporation Trust Company, Corporation Trust Cen-
ter, 1209 Orange Street, Wilmington, New Castle County, Dela-
ware 19801. At any time, the General Partner may designate
another registered agent and/or registered office.
-2-
<PAGE> 7
Section 1.6 Principal Place of Business. The prin-
cipal place of business of the Partnership shall be at c/o
Transamerica Corporation, 600 Montgomery Street, San Francisco,
California 94111. Upon ten days written notice to the Limited
Partners, the General Partner may change the location of the
Partnership's principal place of business.
Section 1.7 Name and Business Address of General
Partner. The name and address of the General Partner are as
follows:
Transamerica Corporation
600 Montgomery Street
San Francisco, California 94111
Attention: Corporate Secretary
The General Partner may change its name or business address
from time to time, in which event the General Partner shall
promptly notify the Limited Partners of any such change.
Section 1.8 Admission of Holders of Preferred Secu-
rities.
(a) Without necessity for execution of this Agree-
ment, upon receipt by a Person of an LP Certificate (as defined
herein) and payment to the Partnership of the Purchase Price
(as defined herein) for the Preferred Securities represented by
such LP Certificate in connection with the initial issuance by
the Partnership of such Preferred Securities, which shall be
deemed to constitute a request by such Person that the books
and records of the Partnership reflect such Person's admission
as a limited partner of the Partnership, such Person shall be
admitted to the Partnership as a limited partner of the Part-
nership and shall become bound by this Agreement.
(b) Following the first admission of a Preferred
Security Holder to the Partnership as a Limited Partner pursu-
ant to paragraph (a) above, the Initial Limited Partner shall
receive the return of its capital contribution without interest
or deduction, but will continue to be a limited partner of the
Partnership. While the Initial Limited Partner shall continue
to be a limited partner of the Partnership, the Initial Limited
Partner shall only have such rights, if any, as are expressly
provided to the Initial Limited Partner pursuant to this Agree-
ment.
(c) The name and mailing address of each Partner and
the amount contributed by such Partner to the capital of the
Partnership shall be listed on the books and records of the
Partnership. The General Partner shall be required to update
-3-
<PAGE> 8
the books and records from time to time as necessary to accu-
rately reflect the information therein.
ARTICLE II
DEFINED TERMS
Section 2.1 Definitions. Unless the context other-
wise requires, the terms defined in this Article II shall, for
the purposes of this Agreement, have the meanings herein speci-
fied.
"Act" means the Delaware Revised Uniform Limited
Partnership Act, 6 Del. C. Section 17-101, et seq., as amended
from time to time.
"Action" has the meaning set forth in Section 6.1(b).
"Affiliate" means, with respect to a specified Per-
son, (a) any Person directly or indirectly owning, controlling
or holding with power to vote 10% or more of the outstanding
voting securities or other ownership interests of the specified
Person, (b) any Person 10% or more of whose outstanding voting
securities or other ownership interests are directly or indi-
rectly owned, controlled or held with power to vote by the
specified Person, (c) any Person directly or indirectly con-
trolling, controlled by, or under common control with the spec-
ified Person, (d) a partnership in which the specified Person
is a general partner, (e) any officer or director of the speci-
fied Person, and (f) if the specified Person is an individual,
any entity of which the specified Person is an officer, direc-
tor or general partner.
"Agreement" means this Amended and Restated Agreement
of Limited Partnership of the Partnership, as amended, modi-
fied, supplemented or restated from time to time.
"Book Entry Interests" means a beneficial interest in
the LP Certificates, ownership and transfers of which shall be
made through book entries by a Clearing Agency as described in
Section 10.4.
"Business Day" means any day other than a day on
which banking institutions in The City of New York are autho-
rized or required by law to close.
"Capital Account" has the meaning set forth in Sec-
tion 3.3.
-4-
<PAGE> 9
"Certificate" means the Certificate of Limited Part-
nership of the Partnership filed with the Secretary of State of
the State of Delaware on August 9, 1994, and any and all amend-
ments thereto and restatements thereof.
"Clearing Agency" means an organization registered as
a "Clearing Agency" pursuant to Section 17A of the Exchange Act
that is acting as depository for the Preferred Securities and
in whose name shall be registered a global LP Certificate and
which shall undertake to effect book entry transfers and
pledges of the Preferred Securities.
"Clearing Agency Participant" means a broker, dealer,
bank, other financial institution or other Person for whom from
time to time the Clearing Agency effects book entry transfers
and pledges of securities deposited with the Clearing Agency.
"Code" means the Internal Revenue Code of 1986, as
amended from time to time, or any corresponding federal tax
statute enacted after the date of this Agreement. A reference
to a specific section ((Sec.)) of the Code refers not only to such
specific section but also to any corresponding provision of any
federal tax statute enacted after the date of this Agreement,
as such specific section or corresponding provision is in
effect on the date of application of the provisions of this
Agreement containing such reference.
"Covered Person" means any Partner, any Affiliate of
a Partner or any officers, directors, shareholders, partners,
members, employees, representatives or agents of a Partner or
its respective Affiliates, or any employee or agent of the
Partnership or its Affiliates or any Special Representative.
"Definitive LP Certificates" has the meaning set
forth in Section 10.4.
"Dividends" means the distributions of income paid or
payable to any Limited Partner who is a Preferred Security
Holder pursuant to the terms of the Preferred Securities held
by such Limited Partner, including any interest payable in
respect of arrearages.
"DTC" means The Depository Trust Company, the initial
Clearing Agency.
"Exchange Act" means the Securities Exchange Act of
1934, as amended.
"Fiscal Year" means (i) the period commencing upon
the formation of the Partnership and ending on December 31,
-5-
<PAGE> 10
1994, and (ii) any subsequent twelve (12) month period commenc-
ing on January 1 and ending on December 31.
"General Partner" means Transamerica, in its capacity
as general partner of the Partnership, and any additional or
successor general partner in the Partnership admitted as a gen-
eral partner of the Partnership pursuant to this Agreement.
"Guarantee" means the Guarantee Agreement dated as of
_______ __, 1994 of Transamerica in respect of the Preferred
Securities.
"Holders" means, with respect to a series of Pre-
ferred Securities, Preferred Security Holders in whose name one
or more LP Certificates representing Preferred Securities of
such series are registered.
"Indemnified Person" means the General Partner, any
Special Representative, any Affiliate of the General Partner or
any Special Representative or any officers, directors, share-
holders, members, partners, employees, representatives or
agents of the General Partner or any Special Representative, or
any employee or agent of the Partnership or its Affiliates.
"Indenture" means the Indenture dated as of
_______ __, 1994 between Transamerica and The First National Bank
of Chicago, as Trustee, pursuant to which the Junior Subordinated
Debentures are issued.
"Initial Limited Partner" means Transamerica LP Hold-
ings Corp., a Delaware corporation.
"Initial Preferred Limited Partners" means the Per-
sons admitted as Limited Partners pursuant to Section 1.8(a) in
connection with the initial issuance by the Partnership of Pre-
ferred Securities.
"Interest" means the entire ownership interest of a
Partner in the Partnership at any particular time, including,
without limitation, its interest in the capital, profits,
losses and distributions of the Partnership.
"Junior Subordinated Debentures" means any series of
debentures issued by Transamerica under the Indenture.
"Limited Partner" means any Person who is admitted to
the Partnership as a limited partner of the Partnership pursu-
ant to the terms of this Agreement, including the Preferred
Security Holders, in each such Person's capacity as a limited
partner of the Partnership.
-6-
<PAGE> 11
"Liquidation Distribution" has the meaning set forth
in the applicable Action relating to a series of Preferred
Securities.
"Liquidator" has the meaning set forth in Section
11.3.
"Loss Carried Forward Amount" means as of the first
day of any month for any series of Preferred Securities, an
amount equal to the excess of (x) all Net Loss allocated to the
Holders of such series of Preferred Securities from the date of
issuance of such series of Preferred Securities through and
including the day prior to the first day of such month pursuant
to Section 4.1(b)(ii) over (y) the amount of Net Income allo-
cated to the Holders of such series of Preferred Securities
pursuant to Section 4.1(a)(ii) with respect to such period.
"LP Certificate" means a certificate of partnership
interest substantially in the form attached hereto as Annex A,
evidencing the Preferred Securities held by a Limited Partner.
"Majority in liquidation preference of the Preferred
Securities" means Holder(s) of a series of Preferred Securities
or, as the context may require, Holder(s) of more than one
series of Preferred Securities voting as a class, who are the
record owners of Preferred Securities whose liquidation prefer-
ence (including the stated preference amount that would be paid
on redemption or maturity, plus accrued and unpaid dividends,
whether or not declared, to the date upon which the voting per-
centages are determined) represents more than 50% of the above
stated liquidation preference of all Preferred Securities of
such series or, as applicable, multiple series.
"Net Income" and "Net Loss", respectively, for any
period means the income and loss, respectively, of the Partner-
ship for such period as determined in accordance with the
method of accounting followed by the Partnership for federal
income tax purposes, including, for all purposes, any income
exempt from tax and any expenditures of the Partnership which
are described in Code Section 705(a)(2)(B); provided, however,
that any item allocated under Section 4.2 shall be excluded
from the computation of Net Income and Net Loss.
"Partners" means the General Partner and the Limited
Partners, collectively, where no distinction is required by the
context in which the term is used.
"Partnership" means the limited partnership hereto-
fore formed and continued under and pursuant to this Agreement.
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"Paying Agent" has the meaning set forth in Section
10.7.
"Person" means any individual, corporation, limited
liability company, association, partnership, trust or other
entity.
"Preferred Securities" means the limited partner
interests in the Partnership described in Article VI.
"Preferred Security Holder" has the meaning set forth
in Section 10.3.
"Preferred Security Beneficial Owner" means, with
respect to a Book Entry Interest, a Person who is the benefi-
cial owner of such Book Entry Interest, as reflected on the
books of the Clearing Agency, or on the books of a Person main-
taining an account with such Clearing Agency (directly as a
Clearing Agency Participant or as an indirect participant, in
each case in accordance with the rules of such Clearing
Agency).
"Pricing Agreement" means a Pricing Agreement between
the Partnership and Transamerica relating to the issuance of
the Preferred Securities.
"Purchase Price" for any Preferred Security means the
amount paid for such Preferred Security in the initial sale by
the Partnership of such Preferred Security.
"Securities Act" means the Securities Act of 1933, as
amended.
"66-2/3% in liquidation preference of the Preferred
Securities" means Holder(s) of a series of Preferred Securities
or, as the context may require, Holder(s) of more than one
series of Preferred Securities voting as a class, who are the
record owners of Preferred Securities whose liquidation prefer-
ence (including the stated preference amount that would be paid
on redemption or maturity, plus accrued and unpaid dividends,
whether or not declared, to the date upon which the voting per-
centages are determined) represents more than 66-2/3% of the
above stated liquidation preference of all Preferred Securities
of such series or, as applicable, multiple series.
"Special Representative" means a special representa-
tive of the Partnership and the Holders elected or appointed in
accordance with the applicable Action relating to a series of
Preferred Securities.
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"Tax Matters Partner" means the General Partner des-
ignated as such in Section 9.9 hereof.
"10% in liquidation preference of the Preferred
Securities" means Holders(s) of a series of Preferred Securi-
ties or, as the context may require, Holder(s) of more than one
series of Preferred Securities voting as a class, who are the
record owners of Preferred Securities whose liquidation prefer-
ence (including the stated preference amount that would be paid
on redemption or maturity, plus accrued and unpaid dividends,
whether or not declared, to the date upon which the voting per-
centages are determined) represents more than 10% of the above
stated liquidation preference of all Preferred Securities of
such series or, as applicable, multiple series.
"Transamerica" has the meaning set forth in the fore-
part of this Agreement.
"Treasury Regulations" means the income tax regula-
tions, including temporary regulations, promulgated under the
Code, as such regulations may be amended from time to time
(including corresponding provisions of succeeding regulations).
"Trustee" means the Trustee under the Indenture.
"Underwriting Agreement" means an Underwriting Agree-
ment, among the Partnership and the underwriters named therein
relating to the issuance of the Preferred Securities.
ARTICLE III
CAPITAL CONTRIBUTIONS, REPRESENTATION OF
PREFERRED SECURITY HOLDER'S INTEREST; CAPITAL ACCOUNTS
Section 3.1 Capital Contributions.
(a) The General Partner has, on or prior to the date
hereof, contributed an aggregate of $3.00 to the capital of the
Partnership, which amount is equal to at least 3% of the total
capital contributions to the Partnership on the date hereof,
after taking into account the contribution of the Initial Limited
Partner referred to in paragraph (b) of this Section 3.1.
Subject to Section 4.1(c), the General Partner shall from time
to time make such additional capital contributions as are
necessary to maintain its Capital Account balance at least
equal to 3% of the aggregate positive Capital Account
balances of all Partners.
(b) The Initial Limited Partner has, prior to the
date hereof, contributed the amount of $97.00 to the capital of
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the Partnership which amount is being returned to the Initial
Limited Partner.
(c) With respect to each of the Initial Preferred Limited
Partners, there has been on the date hereof contributed to the
capital of the Partnership the amount of the Purchase Price for
the Preferred Securities acquired by it (such amount being such
Person's capital contribution to the Partnership).
(d) with respect to each Person who is issued a Preferred
Security by the Partnership after the date hereof in connection with
the initial issuance by the Partnership of such Preferred Security,
there shall be contributed to the capital of the Partnership an amount
equal to the Purchase Price for such Preferred Security (such amount
being such Person's capital contribution to the Partnership).
(e) No Limited Partner shall at any time be required
to make any additional capital contributions to the Partner-
ship.
Section 3.2 Preferred Security Holder's Interest
Represented by Preferred Securities. A Preferred Security
Holder's interest in the Partnership shall be represented by
the Preferred Securities held by such Preferred Security Hold-
er. Each Preferred Security Holder's respective Preferred
Securities shall be set forth on the books and records of the
Partnership. Each Partner, including a Preferred Security
Holder, hereby agrees that its interest in the Partnership and
in its Preferred Securities shall for all purposes be personal
property. No Partner, including a Preferred Security Holder,
shall have an interest in specific Partnership property.
Section 3.3 Capital Accounts. An individual capital
account (a "Capital Account") shall be established and main-
tained on the books of the Partnership for each Partner in com-
pliance with Treasury Regulation (Sec.)1.704-1(b)(2)(iv) and
1.704-2, as amended. Subject to the preceding sentence, each
Capital Account will be credited with the capital contributions
made and the profits allocated to such Partner (or predecessor
in interest) and debited by the distributions made and losses
allocated to such Partner (or predecessor in interest).
Section 3.4 Interest on Capital Contributions. No
Partner shall be entitled to interest on or with respect to any
capital contribution to the Partnership.
Section 3.5 Withdrawal and Return of Capital Contri-
butions. No Partner shall be entitled to withdraw any part of
such Partner's capital contribution to the Partnership or to
receive any distributions from the Partnership, except as pro-
vided in this Agreement.
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ARTICLE IV
ALLOCATIONS
Section 4.1 Profits and Losses. Except as provided
in Section 4.2,
(a) the Partnership's Net Income for each calendar
month shall be allocated as follows:
(i) First, to the Holders of each series of Pre-
ferred Securities as of the record date in such calendar
month for the payment of Dividends on such series of Pre-
ferred Securities in an amount equal to the excess of (x)
all Dividends accrued on such series of Preferred Securi-
ties (in accordance with the Action creating such series)
from their date of issuance through and including the
close of such calendar month over (y) the amount of Net
Income allocated to the Holders of such series of Pre-
ferred Securities pursuant to this Section 4.1(a)(i) in
all prior calendar months; provided, however, that (A) as
to any series of Preferred Securities as to which Divi-
dends are not cumulative, no Dividend shall be deemed to
accrue until the Partnership has actually paid (or set
aside money to pay) such Dividend and (B) Dividends as to
Preferred Securities that are cumulative and are not pay-
able at the end of each calendar month shall be deemed to
accrue in a manner consistent with the Action creating
such Preferred Securities. Amounts allocated to all
Holders of any series of Preferred Securities shall be
allocated among such Holders in proportion to the number
of Preferred Securities of such series held by such Hold-
ers.
(ii) Second, to the Holders of each series of
Preferred Securities up to an amount equal to the Loss
Carried Forward Amount for such series as of the first day
of such month. Amounts allocated to all Holders of any
series of Preferred Securities shall be allocated among
such Holders in proportion to the number of Preferred
Securities of such series held by such Holders.
(iii) Any remaining Net Income shall be allocated to
the General Partner.
(b) The Partnership's Net Loss for any calendar
month shall be allocated as follows:
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<PAGE> 16
(i) First, to the General Partner until the General
Partner's Capital Account is reduced to zero; provided,
however, that the aggregate amount of Net Losses allocated
to the General Partner pursuant to this Section 4.1(b)(i)
shall not exceed the sum of 3% of the total capital con-
tributions of all Partners plus the aggregate Net Income
allocated to the General Partner pursuant to this Section 4.1.
(ii) Second, to the Holders of each series of Pre-
ferred Securities in proportion to the aggregate Capital
Account balances of the Holders of such series of Pre-
ferred Securities (calculated taking into account only
contributions, distributions and allocations related to
such series), until the Capital Account balances of such
Holders are reduced to zero; provided, however, that the
General Partner shall make appropriate adjustments in
these allocations, in accordance with Section 4.1(c) with
respect to any Preferred Securities as to which Net Income
has been allocated with respect to Dividends that accrued
but were not paid. Amounts allocated to the Holders of
any series of Preferred Securities shall be allocated
among such Holders in proportion to the number of Pre-
ferred Securities of such series held by such Holders.
(iii) Any remaining Net Loss shall be allocated to the
General Partner.
(c) The General Partner shall make such changes to
the allocations in Sections 4.1(a) and 4.1(b) in the year of
the Partnership's liquidation as it deems reasonably necessary
so that amounts distributed to the Preferred Security Holders
in such year in accordance with Section 11.4(a)(ii) shall equal
their Liquidation Distributions; provided, however, that no
allocation pursuant to this Section 4.1(c) may result in the
General Partner being required to make any capital contribu-
tions pursuant to Section 3.1.
Section 4.2 Other Allocation Provisions.
(a) For purposes of determining the profits, losses
or any other items allocable to any period, profits, losses and
any such other items shall be determined on a daily, monthly or
other basis, as determined by the General Partner using any
method that is permissible under (Sec.)704 of the Code and the
Treasury Regulations.
(b) The Partners are aware of the income tax conse-
quences of the allocations made by this Article IV and hereby
agree to be bound by the provisions of this Article IV in
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<PAGE> 17
reporting their shares of Partnership income and loss for
income tax purposes.
(c) Notwithstanding anything to the contrary that
may be expressed or implied in this Article IV, the interest of
the General Partner in each item of income, gain, loss, deduc-
tion and credit will be equal to at least (i) at any time that
aggregate capital contributions to the Partnership are equal to
or less than $50,000,000, 1% of each such item and (ii) at any
time that aggregate capital contributions to the Partnership
are greater than $50,000,000, 1%, multiplied by a fraction
(not exceeding one and not less than 0.2), the numerator of
which is $50,000,000 and the denominator of which is the lesser
of the aggregate Capital Account balances of the Capital Accounts
of all Partners at such time and the aggregate capital contributions
to the Partnership of all Partners at such time, of such item.
(d) (i) If during any taxable year, a Partner unex-
pectedly receives an adjustment, allocation or distribution
described in Treasury Regulations Section 1.704-
1(b)(2)(ii)(d)(4), (5) or (6), which causes or increases a
deficit balance in the Partner's Adjusted Capital Account (as
defined below), there shall be allocated to the Partner items
of Partnership income and gain (consisting of a pro rata por-
tion of each item of Partnership income, including gross income
and gain for such year) in an amount and manner sufficient to
eliminate such deficit. The foregoing is intended to be a
"qualified income offset" provision as described in Treasury
Regulations Section 1.704-1(b)(2)(ii)(d) and shall be inter-
preted and applied in all respects in accordance with that Reg-
ulation.
A Partner's "Adjusted Capital Account" at any time
shall equal the Partner's Capital Account at such time (x)
increased by the sum of (A) the amount of the Partner's share
of Partnership minimum gain (as defined in Treasury Regulations
Section 1.704-2(g)(1) and (3)) and (B) the amount of the Part-
ner's share of the minimum gain attributable to a "partner non-
recourse debt" (as defined in Treasury Regulations Section
1.704-2(i)(5)) and (y) decreased by reasonably expected adjust-
ments, allocations and distributions described in Treasury Reg-
ulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6).
(ii) While this Agreement does not provide certain
provisions required by Treasury Regulations Sections 1.704-1(b)
and 1.704-2 because those provisions apply to transactions that
are not expected to occur, the Partners intend that the alloca-
tions under Section 4.1 conform to Regulations (Sec.)1.704-1(b)
and 1.704-2 (including, without limitation, the minimum gain
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<PAGE> 18
chargeback, chargeback of partner nonrecourse debt minimum gain
and partner nonrecourse debt provisions of such Regulation),
and the General Partner shall make such changes in the alloca-
tions under Section 4.1 as it believes are reasonably necessary
to meet the requirements of such Treasury Regulations.
(e) Solely for the purpose of adjusting the Capital
Accounts of the Partners, and not for tax purposes, if any
property is distributed in kind to any Partner, the difference
between its fair market value and its book value at the time of
distribution shall be treated as gain or loss recognized by the
Partnership and allocated pursuant to the provisions of Section
4.1; provided, however, that Net Income and Net Loss allocated
as a result of the distribution of any series of Junior Subor-
dinated Debentures to the Holders of any series of Preferred
Securities or to the General Partner (or both) shall be allo-
cated to the Partner receiving the Junior Subordinated Deben-
tures in proportion to the amount of Subordinated Debentures
distributed to them. For this purpose, the fair market value
of any property shall be determined by the General Partner in
its sole discretion, provided, however, that the value of any
Junior Subordinated Debenture shall at all times be treated as
equal to the value of any Preferred Security if the interest
rate on and principal amount of the Junior Subordinated Deben-
ture is the same as the Dividend payable on and the liquidation
preference with respect to the Preferred Security.
Section 4.3 Allocations for Income Tax Purposes.
The income, gains, losses, deductions and credits of the Part-
nership shall be allocated in the same manner as the items
entering into the computation of Net Income and Net Loss were
allocated under Sections 4.1 and 4.2; provided, however, that
solely for federal, state and local income and franchise tax
purposes and not for book or Capital Account purposes, income,
gain, loss and deduction with respect to any property properly
carried on the Partnership's books at a value other than the
tax basis of such property shall be allocated in a manner
determined in the General Partner's discretion, so as to take
into account (consistently with Code Section 704(c) principles)
the difference between such property's book value and its tax
basis.
Section 4.4 Withholding. The Partnership shall com-
ply with withholding requirements under federal, state and
local law and shall remit amounts withheld to and file required
forms with applicable jurisdictions. To the extent that the
Partnership is required to withhold and pay over any amounts to
any authority with respect to distributions or allocations to
any Partner, the amount withheld shall be deemed to be a dis-
tribution in the amount of the withholding to the Partner. In
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<PAGE> 19
the event of any claimed overwithholding, Partners shall be
limited to an action against the applicable jurisdiction. If
the amount withheld was not withheld from actual distributions,
the Partnership may reduce subsequent distributions by the
amount of such withholding. Each Partner agrees to furnish the
Partnership with any representations and forms as shall reason-
ably be requested by the Partnership to assist it in determin-
ing the extent of, and in fulfilling, its withholding obliga-
tions.
ARTICLE V
DIVIDENDS
Section 5.1 Dividends. Limited Partners shall re-
ceive periodic Dividends, if any, redemption payments and
liquidation distributions in accordance with the applicable
terms of the Preferred Securities. The General Partner shall
determine whether and when Dividends shall be payable, and shall
give notice of such determination to all Limited Partners of record
as of the record date for such payments of Dividends. Subject to
the rights of the Preferred Securities, all remaining cash shall
be distributed to the General Partner at such time as the
General Partner shall determine.
Section 5.2 Limitations on Distributions. Notwith-
standing any provision to the contrary contained in this Agree-
ment, the Partnership shall not make a distribution to any
Partner on account of its interest in the Partnership if such
distribution would violate Section 17-607 of the Act or other
applicable law.
ARTICLE VI
ISSUANCE OF PREFERRED SECURITIES
Section 6.1 General Provisions Regarding Preferred
Securities.
(a) The aggregate number of Preferred Securities
which the Partnership shall have authority to issue is unlim-
ited.
(b) The General Partner on behalf of the Partnership
is authorized to issue from time to time limited partner inter-
ests in the Partnership (the "Preferred Securities") in one or
----------------------
more series having such designations, rights, privileges, re-
strictions, preferences and other terms and provisions as may
from time to time be established in a written action or actions
(each, an "Action") of the General Partner providing for the
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<PAGE> 20
issue of such series. In connection with the foregoing, the
General Partner is expressly authorized, prior to issuance, to
set forth in an Action or Actions providing for the issue of
such series, the following:
(i) the distinctive designation of such series
which shall distinguish it from other series;
(ii) the number of Preferred Securities included
in such series, which number may be increased or
decreased from time to time unless otherwise pro-
vided by the General Partner in creating the
series;
(iii) the annual Dividend rate (or method of
determining such rate) for Preferred Securities of
such series and the date or dates upon which such
Dividends shall be payable, provided, however,
Dividends on any series of Preferred Securities
shall be payable, if and to the extent determined
to be so payable by the General Partner, on a
monthly basis to Holders of such series of Pre-
ferred Securities as of a record date in each
month during which such series of Preferred Secu-
rities are outstanding;
(iv) whether Dividends on the Preferred Securi-
ties of such series shall be cumulative, and, in
the case of Preferred Securities of any series
having cumulative Dividend rights, the date or
dates or method of determining the date or dates
from which Dividends on the Preferred Securities
of such series shall be cumulative;
(v) the amount or amounts which shall be paid
out of the assets of the Partnership to the Hold-
ers of the Preferred Securities of such series
upon voluntary or involuntary dissolution, winding
up or liquidation of the Partnership;
(vi) the price or prices at which, the period or
periods within which, and the terms and conditions
upon which, the Preferred Securities of such
series may be redeemed or purchased, in whole or
in part, at the option of the Partnership or the
General Partner;
(vii) the obligation, if any, of the Partnership
to purchase or redeem Preferred Securities of such
series and the price or prices at which, the
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period or periods within which, and the terms and
conditions upon which, the Preferred Securities of
such series shall be purchased or redeemed, in
whole or in part, pursuant to such obligation;
(viii) the voting rights, if any, of the Pre-
ferred Securities of such series in addition to
those required by law, including the number of
votes per Preferred Security and any requirement
for the approval by the Holders of Preferred Secu-
rities, or of the Preferred Securities of one or
more series, or of both, as a condition to speci-
fied action or amendments to this Agreement; and
(ix) any other relative rights, powers, prefer-
ences or limitations of the Preferred Securities
of the series not inconsistent with this Agreement
or with applicable law.
(c) In connection with the foregoing and without
limiting the generality thereof, the General Partner is hereby
expressly authorized, without the vote or approval of any Pre-
ferred Security Holder, (i) to take any Action to create under
the provisions of this Agreement a series of Preferred Securi-
ties that was not previously outstanding and (ii) to admit Pre-
ferred Security Holders as limited partners of the Partnership.
Without the vote or approval of any Preferred Security Holder,
the General Partner may execute, swear to, acknowledge, de-
liver, file and record whatever documents may be required in
connection with the issue from time to time of Preferred Secu-
rities in one or more series as shall be necessary, convenient
or desirable to reflect the issue of such series. The General
Partner shall do all things it deems to be appropriate or nec-
essary to comply with the Act and is authorized and directed to
do all things it deems to be necessary or permissible in con-
nection with any future issuance, including compliance with any
statute, rule, regulation or guideline of any federal, state or
other governmental agency or any securities exchange.
(d) Any Action or Actions taken by the General Part-
ner pursuant to the provisions of this Section 6.1 shall be
deemed an amendment and supplement to and part of this Agree-
ment.
(e) The payment of Dividends and payments on dis-
solution of the Partnership or on redemption in respect of Pre-
ferred Securities shall be guaranteed by Transamerica pursuant
to and to the extent set forth in the Guarantee. The Preferred
Security Holders hereby authorize the General Partner to hold
the Guarantee on behalf of the Preferred Security Holders. In
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<PAGE> 22
the event of the appointment of a Special Representative to,
among other things, enforce the Guarantee, the Special Repre-
sentative may take possession of the Guarantee for such pur-
pose. If no Special Representative has been appointed to
enforce the Guarantee, the General Partner has the right to
enforce the Guarantee on behalf of the Preferred Security
Holders. The Holders of not less than a majority in liqui-
dation preference of the Preferred Securities have the right to
direct the time, method and place of conducting any proceeding
for any remedy available in respect of the Guarantee including
the giving of directions to the General Partner or the Special
Representative, as the case may be. If the General Partner or
the Special Representative fails to enforce the Guarantee as
above provided, a Preferred Security Holder may, after a period
of 30 days has elapsed from such Holder's written request to
the General Partner or the Special Representative, as the case
may be, to enforce the Guarantee, institute a legal proceeding
directly against the Guarantor to enforce its rights under the
Guarantee, without first instituting a legal proceeding against
the Partnership or any other Person. The Preferred Security
Holders, by acceptance of such Preferred Securities, thereby
agree to the subordination provisions and other terms of the
Guarantee.
(f) The proceeds received by the Partnership from
the issuance of any series of Preferred Securities, together
with the proceeds of any capital contribution of the General
Partner made at the time of such issuance, shall be invested by
the Partnership in Junior Subordinated Debentures with (A) an
aggregate principal amount equal to such aggregate proceeds and
(B) an interest rate equal to the Dividend rate of such series
of Preferred Securities.
(g) So long as any series of Junior Subordinated
Debentures are held by the Partnership, the General Partner
shall not (i) direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee with
respect to such series, (ii) waive any past default which is
waivable under Section 6.06 of the Indenture, (iii) exercise
any right to rescind or annul a declaration that the principal
of all the Junior Subordinated Debentures of such series shall
be due and payable or (iv) consent to any amendment, modifica-
tion or termination of the Indenture without, in each case,
obtaining the prior approval of the Holders of at least 66 2/3%
in liquidation preference of all series of Preferred Securities
who could be affected thereby if their Preferred Securities were
to be exchanged for Junior Subordinated Debentures, acting as a
single class; provided, however, that where a consent under the
Indenture would require the consent of each holder of Junior
Subordinated Debentures affected thereby, no such consent shall
be given by the General Partner without the prior consent of
each Holder of all series of Preferred Securities affected
thereby if its Preferred Securities were to be exchanged for
Junior Subordinated Debentures. The General Partner shall not
revoke any action previously authorized or approved by a
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<PAGE> 23
vote of the Holders of any series of Preferred Securities
who would be affected thereby if their Preferred Securities
were to be exchanged for Junior Subordinated Debentures. The
General Partner shall notify all Holders of any series of
Preferred Securities of any notice of default received from
the Trustee with respect to the related series of Junior
Subordinated Debentures.
(h) The Partnership may not issue any limited part-
ner interests in the Partnership (including, without limita-
tion, any series of Preferred Securities), unless such series
of Preferred Securities ranks pari passu with each other series
of Preferred Securities then outstanding as regards (A) par-
ticipation in profits and Dividends of the Partnership and (B)
participation in the assets of the Partnership. All Preferred
Securities shall rank senior to the General Partner's Interest
in respect of the right to receive Dividends and the right to
receive payments out of the assets of the Partnership upon vol-
untary or involuntary dissolution, winding up or termination of
the Partnership. All Preferred Securities redeemed, purchased
or otherwise acquired by the Partnership (including Preferred
Securities surrendered for conversion or exchange) shall be
canceled.
(i) No Holder of a Preferred Security shall be en-
titled as a matter of right to subscribe for or purchase, or
have any preemptive right with respect to, any part of any new
or additional issue of Preferred Securities of any class what-
soever, or of securities convertible into any Preferred Securi-
ties of any class whatsoever, whether now or hereafter autho-
rized and whether issued for cash or other consideration or by
way of a Dividend.
ARTICLE VII
BOOKS OF ACCOUNT, RECORDS AND REPORTS
Section 7.1 Books and Records. (a) Proper and com-
plete records and books of account of the Partnership shall be
kept by the General Partner in which shall be entered fully and
accurately all transactions and other matters relative to the
Partnership's business as are usually entered into records and
books of account maintained by Persons engaged in businesses of
a like character, including a Capital Account for each Partner.
The books and records of the Partnership, together with a copy
of this Agreement and a certified copy of the Certificate,
shall at all times be maintained at the principal office of the
Partnership and shall be open to the inspection and examination
of any Limited Partner or its duly authorized representative
for any purpose reasonably related to its Interest during rea-
sonable business hours.
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<PAGE> 24
(b) Notwithstanding any other provision of this
Agreement, the General Partner may, to the maximum extent per-
mitted by applicable law, keep confidential from the Partners
any information the disclosure of which the General Partner
reasonably believes is not in the best interests of the Part-
nership or is adverse to the interests of the Partnership or
which the Partnership or the General Partner is required by law
or by an agreement with any Person to keep confidential.
(c) Within three months after the close of each Fis-
cal Year, the General Partner shall transmit to each Partner, a
statement indicating such Partner's share of each item of Part-
nership income, gain, loss, deduction or credit for such Fiscal
Year for federal income tax purposes.
Section 7.2 Accounting Method. For both financial
and tax reporting purposes and for purposes of determining pro-
fits and losses, the books and records of the Partnership shall
be kept on the accrual method of accounting applied in a con-
sistent manner and shall reflect all Partnership transactions
and be appropriate and adequate for the Partnership's business.
ARTICLE VIII
POWERS, RIGHTS AND DUTIES OF THE LIMITED PARTNERS
Section 8.1 Limitations. The Limited Partners shall
not participate in the management or control of the Partner-
ship's business, property or other assets nor shall the Limited
Partners transact any business for the Partnership, nor shall
the Limited Partners have the power to act for or bind the
Partnership, said powers being vested solely and exclusively in
the General Partner. The Limited Partners shall have such
rights as are set forth herein, including any Action, and as
are set forth in the Guarantee and the Indenture. The Limited
Partners shall have no interest in the properties or assets of
the General Partner, or any equity therein, or in any proceeds
of any sales thereof (which sales shall not be restricted in
any respect), by virtue of acquiring or owning an Interest.
Section 8.2 Liability. Subject to the provisions of
the Act, no Limited Partner shall be liable for the repayment,
satisfaction or discharge of any debts or other obligations of
the Partnership in excess of the Capital Account balance of
such Limited Partner.
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Section 8.3 Priority. No Limited Partner shall have
priority over any other Limited Partner as to Partnership allo-
cations or distributions.
ARTICLE IX
POWERS, RIGHTS AND DUTIES OF THE GENERAL PARTNER
Section 9.1 Authority. Subject to the limitations
provided in this Agreement, the General Partner shall have
exclusive and complete authority and discretion to manage the
operations and affairs of the Partnership and to make all deci-
sions regarding the business of the Partnership. Any action
taken by the General Partner shall constitute the act of and
serve to bind the Partnership. In dealing with the General
Partner acting on behalf of the Partnership, no Person shall be
required to inquire into the authority of the General Partner
to bind the Partnership. Persons dealing with the Partnership
are entitled to rely conclusively on the power and authority of
the General Partner as set forth in this Agreement.
Section 9.2 Powers and Duties of General Partner.
Except as otherwise specifically provided herein, the General
Partner shall have all rights and powers of a general partner
under the Act, and shall have all authority, rights and powers
in the management of the Partnership business to do any and all
other acts and things necessary, proper, convenient or advis-
able to effectuate the purposes of this Agreement, including by
way of illustration but not by way of limitation, the follow-
ing:
(a) to secure the necessary goods and services
required in performing the General Partner's duties for
the Partnership;
(b) to exercise all powers of the Partnership, on
behalf of the Partnership, in connection with enforcing
the Partnership's rights and interest under the Junior
Subordinated Debentures and the Guarantee;
(c) to issue Preferred Securities, and series there-
of, in accordance with this Agreement;
(d) to establish a record date with respect to all
actions to be taken hereunder that require a record date
be established, including with respect to Dividends and
voting rights and to make determinations as to the payment
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of Dividends, and make all other required payments to Pre-
ferred Security Holders and to the General Partner as the
Partnership's paying agent;
(e) to open, maintain and close bank accounts and to
draw checks and other orders for the payment of money;
(f) to bring or defend, pay, collect, compromise,
arbitrate, resort to legal action, or otherwise adjust
claims or demands of or against the Partnership;
(g) to deposit, withdraw, invest, pay, retain and
distribute the Partnership's funds in a manner consistent
with the provisions of this Agreement;
(h) to take all action which may be necessary or
appropriate for the preservation and the continuation of
the Partnership's valid existence, rights, franchises and
privileges as a limited partnership under the laws of the
State of Delaware and of each other jurisdiction in which
such existence is necessary to protect the limited liabil-
ity of the Limited Partners or to enable the Partnership
to conduct the business in which it is engaged;
(i) to take all action not inconsistent with appli-
cable law, the Certificate or this Agreement as long as
such action does not adversely affect the interests of the
Preferred Security Holders, necessary to conduct its
affairs and to operate the Partnership in such a way that
the Partnership would not be deemed an "investment com-
pany" required to be registered under the Investment Com-
pany Act of 1940 or taxed as a corporation for federal
income tax purposes and so that the Junior Subordinated
Debentures will be treated as indebtedness of Transamerica
for federal income tax purposes;
(j) to cause the Partnership to enter into and per-
form from time to time, on behalf of the Partnership, one
or more Underwriting Agreements and one or more Pricing
Agreements providing for the sale of Preferred Securities
and to cause the Partnership to purchase the Junior Subor-
dinated Debentures without any further act, vote or ap-
proval of any Partner; and
(k) to execute and deliver any and all documents or
instruments, perform all duties and powers and do all
things for and on behalf of the Partnership in all matters
necessary, desirable, convenient or incidental to the
foregoing.
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Section 9.3 Liability. Except as expressly set
forth in this Agreement, (a) the General Partner shall not be
personally liable for the return of any portion of the capital
contributions (or any return thereon) of the Limited Partners;
(b) the return of such capital contributions (or any return
thereon) shall be made solely from assets of the Partnership;
and (c) the General Partner shall not be required to pay to the
Partnership or to any Limited Partner any deficit in any Lim-
ited Partner's Capital Account upon dissolution or otherwise.
Section 9.4 Exculpation. (a) No Indemnified Person
shall be liable, responsible or accountable in damages or oth-
erwise to the Partnership or any Covered Person for any loss,
damage or claim incurred by reason of any act or omission per-
formed or omitted by such Indemnified Person in good faith on
behalf of the Partnership and in a manner such Indemnified Person
reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Agreement or by
law, except that an Indemnified Person shall be liable for any
such loss, damage or claim incurred by reason of such Indemnified
Person's gross negligence or willful misconduct with respect to
such acts or omissions.
(b) An Indemnified Person shall be fully protected
in relying in good faith upon the records of the Partnership
and upon such information, opinions, reports or statements pre-
sented to the Partnership by any Person as to matters the
Indemnified Person reasonably believes are within such other
Person's professional or expert competence and who has been
selected with reasonable care by or on behalf of the Partner-
ship, including information, opinions, reports or statements as
to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and
amount of assets from which distributions to Partners might
properly be paid.
Section 9.5 Fiduciary Duty. (a) To the extent
that, at law or in equity, an Indemnified Person has duties
(including fiduciary duties) and liabilities relating thereto
to the Partnership or to any other Covered Person, an Indemni-
fied Person acting under this Agreement shall not be liable to
the Partnership or to any other Covered Person for its good
faith reliance on the provisions of this Agreement. The provi-
sions of this Agreement, to the extent that they restrict the
duties and liabilities of an Indemnified Person otherwise
existing at law or in equity, are agreed by the parties hereto
to replace such other duties and liabilities of such Indemni-
fied Person.
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(b) Unless otherwise expressly provided herein, (i)
whenever a conflict of interest exists or arises between Cov-
ered Persons, or (ii) whenever this Agreement or any other
agreement contemplated herein or therein provides that an In-
demnified Person shall act in a manner that is, or provides
terms that are, fair and reasonable to the Partnership or any
Partner, the Indemnified Person shall resolve such conflict of
interest, take such action or provide such terms, considering
in each case the relative interest of each party (including its
own interest) to such conflict, agreement, transaction or situ-
ation and the benefits and burdens relating to such interests,
any customary or accepted industry practices, and any appli-
cable generally accepted accounting practices or principles.
In the absence of bad faith by the Indemnified Person, the
resolution, action or term so made, taken or provided by the
Indemnified Person shall not constitute a breach of this Agree-
ment or any other agreement contemplated herein or of any duty
or obligation of the Indemnified Person at law or in equity or
otherwise.
(c) Whenever in this Agreement an Indemnified Person
is permitted or required to make a decision (i) in its "discre-
tion" or under a grant of similar authority, the Indemnified
Person shall be entitled to consider such interests and factors
as it desires, including its own interests, and shall have no
duty or obligation to give any consideration to any interest of
or factors affecting the Partnership or any other Person, or
(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard and
shall not be subject to any other or different standard imposed
by this Agreement or by applicable law.
Section 9.6 Indemnification. (a) To the fullest
extent permitted by applicable law, the Partnership shall
indemnify and hold harmless each Indemnified Person from and
against any loss, damage or claim incurred by such Indemnified
Person by reason of any act or omission performed or omitted by
such Indemnified Person in good faith on behalf of the Partner-
ship and in a manner such Indemnified Person reasonably believed
to be within the scope of authority conferred on such Indemnified
Person by this Agreement, except that no Indemnified Person shall
be entitled to be indemnified in respect of any loss, damage or
claim incurred by such Indemnified Person by reason of gross negli-
gence or willful misconduct with respect to such acts or omis-
sions; provided, however, that any indemnity under this Section
9.6 shall be provided out of and to the extent of Partnership
assets only, and no Covered Person shall have any personal
liability on account thereof.
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(b) To the fullest extent permitted by applicable
law, expenses (including legal fees) incurred by an Indemnified
Person in defending any claim, demand, action, suit or proceed-
ing shall, from time to time, be advanced by the Partnership
prior to the final disposition of such claim, demand, action,
suit or proceeding upon receipt by the Partnership of an under-
taking by or on behalf of the Indemnified Person to repay such
amount if it shall be determined that the Indemnified Person is
not entitled to be indemnified as authorized in Section 9.6(a).
Section 9.7 Outside Businesses. Any Covered Person
may engage in or possess an interest in other business ventures
of any nature of description, independently or with others,
similar or dissimilar to the business of the Partnership, and
the Partnership and the Partners shall have no rights by virtue
of this Agreement in and to such independent ventures or the
income or profits derived therefrom and the pursuit of any such
venture, even if competitive with the business of the Partner-
ship, shall not be deemed wrongful or improper. No Covered
Person shall be obligated to present any particular investment
or other opportunity to the Partnership even if such oppor-
tunity is of a character that, if presented to the Partnership,
could be taken by the Partnership, and any Covered Person shall
have the right to take for its own account (individually or as
a partner or fiduciary) or to recommend to others any such par-
ticular investment or other opportunity.
Section 9.8 Limits on General Partner's Powers.
Anything in this Agreement to the contrary notwithstanding, the
General Partner shall not cause or permit the Partnership to
(a) acquire any assets other than as expressly pro-
vided herein;
(b) possess Partnership property for other than a
Partnership purpose;
(c) admit a Person as a partner of the Partnership,
except as expressly provided in this Agreement;
(d) make any loans to the General Partner or its
Affiliates, other than loans represented by the Junior
Subordinated Debentures or other similar debt instruments
of Transamerica;
(e) perform any act that would subject any Limited
Partner to liability as a general partner in any jurisdic-
tion;
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(f) engage in any activity that is not consistent
with the purposes of the Partnership, as set forth in Sec-
tion 1.3;
(g) confess a judgment against the Partnership;
(h) without the written consent of 66-2/3% in liqui-
dation preference of the outstanding Preferred Securities
have an order for relief entered with respect to the Part-
nership or commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or here-
after in effect, or consent to the entry of an order for
relief in an involuntary case under any such law, or con-
sent to the appointment of or taking possession by a re-
ceiver, trustee or other custodian for all or a substan-
tial part of the Partnership's property, or make any
assignment for the benefit of creditors of the Partner-
ship; it being understood that nothing in this paragraph
(h) is to effect the ability of the Partnership to dis-
solve pursuant to this Agreement; or
(i) subject to Section 1.3, borrow money or become
liable for the borrowings of any third party or engage in
any financial or other trade or business.
Section 9.9 Tax Matters Partner. (a) For purposes
of Code Section 6231(a)(7), the "Tax Matters Partner" shall be
Transamerica as long as it remains the general partner of the
Partnership. The Tax Matters Partner shall keep the Limited
Partners fully informed of any inquiry, examination or proceed-
ing.
(b) The General Partner shall not make an election
in accordance with (Sec.)754 of the Code.
(c) The General Partner and the Preferred Security
Holders acknowledge that they intend, for U.S. federal income
tax purposes, that the Partnership shall be treated as a part-
nership and that the General Partner and the Preferred Security
Holders shall be treated as partners of the Partnership for
such purposes.
Section 9.10 Expenses. (a) The General Partner
shall pay for all, and the Partnership shall not be obligated
to pay, directly or indirectly, for any, costs and expenses of
the Partnership (including, but not limited to, costs and
expenses relating to the organization of, and offering of lim-
ited partner interests in, the Partnership and costs and
expenses relating to the operation of the Partnership, includ-
ing without limitation, costs and expenses of accountants,
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attorneys, statistical or bookkeeping services and computing or
accounting equipment, paying agent(s), registrar(s), transfer
agent(s), duplicating, travel and telephone and costs and ex-
penses incurred in connection with the acquisition, financing,
and disposition of Partnership assets).
(b) The General Partner will pay any and all taxes
(other than United States withholding taxes) and all liabili-
ties, costs and expenses with respect to such taxes of the
Partnership.
ARTICLE X
TRANSFERS OF INTERESTS BY PARTNERS
Section 10.1 Transfer of Interests. (a) Preferred
Securities shall be freely transferable by a Preferred Security
Holder.
(b) The General Partner may not assign its interest
in the Partnership in whole or in part under any circumstances
except to a successor of Transamerica as permitted under the
Indenture. The admission of such successor as a general part-
ner of the Partnership shall be effective upon the filing of an
amendment to the Certificate with the Secretary of State of the
State of Delaware which indicates that such successor has been
admitted as a general partner in the Partnership. If the Gen-
eral Partner assigns its entire Interest to a successor of
Transamerica as permitted under the Indenture, the General
Partner shall cease to be a general partner in the Partnership
simultaneously with the admission of the successor as a general
partner in the Partnership. Any such successor general partner
in the Partnership is hereby authorized to and shall continue
the business of the Partnership without dissolution.
(c) No Interest shall be transferred, in whole or in
part, except in accordance with the terms and conditions set
forth in this Agreement. Any transfer or purported transfer of
any Interest not made in accordance with this Agreement shall
be null and void.
Section 10.2 Transfer of LP Certificates. The Gen-
eral Partner shall provide for the registration of LP Certifi-
cates and of transfers of LP Certificates. Upon surrender for
registration of transfer of any LP Certificate, the General
Partner shall cause one or more new LP Certificates to be
issued in the name of the designated transferee or transferees.
Every LP Certificate surrendered for registration of transfer
shall be accompanied by a written instrument of transfer in
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form satisfactory to the General Partner duly executed by the
Preferred Security Holder or such Holder's attorney duly autho-
rized in writing. Each LP Certificate surrendered for regis-
tration of transfer shall be canceled by the General Partner.
A transferee of an LP Certificate shall be admitted to the
Partnership as a Limited Partner and shall be entitled to the
rights and subject to the obligations of a Preferred Security
Holder hereunder upon the receipt by such transferee of an LP Cer-
tificate. By acceptance of an LP Certificate, each transferee
shall be deemed to have requested admission as a Limited Part-
ner and to have agreed to be bound by this Agreement. The
transferor of an LP Certificate, in whole, shall cease to be a
Limited Partner at the time that the transferee of such LP Cer-
tificate is admitted to the Partnership as a Limited Partner in
accordance with this Section 10.2.
Section 10.3 Persons Deemed Preferred Security Hold-
ers. The Partnership may treat the Person in whose name any LP
Certificate shall be registered on the books and records of the
Partnership as the sole holder of such LP Certificate and of
the Preferred Securities represented by such LP Certificate
(the "Preferred Security Holder") for purposes of receiving
Dividends and for all other purposes whatsoever and, accord-
ingly, shall not be bound to recognize any equitable or other
claim to or interest in such LP Certificate or in the Preferred
Securities represented by such LP Certificate on the part of
any other Person, whether or not the Partnership shall have
actual or other notice thereof.
Section 10.4 Book Entry Interests. Unless otherwise
specified in the Action with respect to any series of Preferred
Securities, the LP Certificates, on original issuance, will be
issued in the form of a global LP Certificate or LP Certificates
representing the Book Entry Interests, to be delivered to DTC,
the initial Clearing Agency, by, or on behalf of, the Partnership.
Such LP Certificate or LP Certificates shall initially be
registered on the books and records of the Partnership in the
name of Cede & Co., the nominee of DTC, and no Preferred Security
Beneficial Owner will receive a definitive LP Certificate
representing such Preferred Security Beneficial Owner's interests
in such LP Certificate, except as provided in Section 10.7.
Unless and until definitive, fully registered LP Certificates
(the "Definitive LP Certificates") have been issued to the
Preferred Security Beneficial Owners pursuant to Section 10.7:
(i) The provisions of this Section shall be in full
force and effect;
(ii) The Partnership and the General Partner shall be
entitled to deal with the Clearing Agency for all purposes
of this Agreement (including the payment of Dividends on
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the LP Certificates and receiving approvals, votes or con-
sents hereunder) as the Preferred Security Holder and the
sole holder of the LP Certificates and shall have no obli-
gation to the Preferred Security Beneficial Owners;
(iii) To the extent that the provisions of this Sec-
tion conflict with any other provisions of this Agreement,
the provisions of this Section shall control; and
(iv) The rights of the Preferred Security Beneficial
Owners shall be exercised only through the Clearing Agency
and shall be limited to those established by law and
agreements between such Preferred Security Beneficial
Owners and the Clearing Agency and/or the Clearing Agency
Participants. DTC will make book entry transfers among
the Clearing Agency Participants and receive and transmit
payments of Dividends on the LP Certificates to such
Clearing Agency Participants.
Section 10.5 Notices to Clearing Agency. Whenever a
notice or other communication to the Preferred Security Holders
is required under this Agreement, unless and until Definitive
LP Certificates shall have been issued to the Preferred Secu-
rity Beneficial Owners pursuant to Section 10.7, the General
Partner shall give all such notices and communications speci-
fied herein to be given to the Preferred Security Holders to
the Clearing Agency, and shall have no obligations to the Pre-
ferred Security Beneficial Owners.
Section 10.6 Appointment of Successor Clearing
Agency. If any Clearing Agency elects to discontinue its ser-
vices as securities depository with respect to the Preferred
Securities, the General Partner may, in its sole discretion,
appoint a successor Clearing Agency with respect to the Pre-
ferred Securities.
Section 10.7 Definitive LP Certificates; Appointment
of Paying Agent(s). If (i) a Clearing Agency elects to discon-
tinue its services as securities depository with respect to the
Preferred Securities and a successor Clearing Agency is not
appointed within 90 days after such discontinuance pursuant to
Section 10.6 or (ii) the Partnership elects to terminate the
book entry system through the Clearing Agency, then (a) Defini-
tive LP Certificates shall be prepared by the Partnership and
(b) the General Partner shall authorize one or more Persons
(each, a "Paying Agent") to pay Dividends, redemption payments
or liquidation payments on behalf of the Partnership with re-
spect to the Preferred Securities. Upon surrender of the
global LP Certificate or LP Certificates representing the Book
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Entry Interests by the Clearing Agency, accompanied by regis-
tration instructions, the General Partner shall cause Defini-
tive LP Certificates to be delivered to Preferred Security Ben-
eficial Owners in accordance with the instructions of the
Clearing Agency. Neither the General Partner nor the Partner-
ship shall be liable for any delay in delivery of such instruc-
tions and each of them may conclusively rely on, and shall be
protected in relying on, such instructions. Any Person receiv-
ing a Definitive LP Certificate in accordance with this Article
X shall be admitted to the Partnership as a Limited Partner
upon receipt of such Definitive LP Certificate and shall be
registered on the books and records of the Partnership as a
Preferred Security Holder. The Clearing Agency or the nominee
of the Clearing Agency, as the case may be, shall cease to be a
Limited Partner under this Section 10.7 at the time that at
least one additional Person is admitted to the Partnership as a
Limited Partner in accordance with this Section 10.7. The
Definitive LP Certificates shall be printed, lithographed or
engraved or may be produced in any other manner as is reason-
ably acceptable to the General Partner, as evidenced by its
execution thereof.
ARTICLE XI
WITHDRAWAL; DISSOLUTION; LIQUIDATION AND
DISTRIBUTION OF ASSETS
Section 11.1 Withdrawal of Partners. Subject to the
further provisions of this Section 11.1 and except as provided
in Article X, no Partner shall at any time withdraw from the
Partnership. Any Partner withdrawing in contravention of this
Section 11.1 shall indemnify, defend and hold harmless the
Partnership and the other Partners from and against any losses,
expenses, judgments, fines, settlements or damages suffered or
incurred by the Partnership or such other Partners arising out
of or resulting from such withdrawal. No permitted transfer of
all or any portion of a Partner's Interest in the Partnership,
in accordance with Article X shall constitute a withdrawal in
violation of this Section 11.1. Further, the withdrawal of a
Holder in connection with the redemption of its entire Interest
in the Partnership, in accordance with the terms hereof or of
an Action, shall not constitute a violation of this Section
11.1.
Section 11.2 Dissolution of the Partnership. (a)
The Partnership shall not be dissolved by the admission of
additional or successor Partners in accordance with the terms
of this Agreement. The death, withdrawal, bankruptcy or dis-
solution of a Limited Partner, or the occurrence of any other
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event which terminates the Interest of a Limited Partner in the
Partnership, shall not, in and of itself, cause the Partnership
to be dissolved and its affairs wound up. To the fullest
extent permitted by applicable law, upon the occurrence of such
event, the General Partner may, without any further act, vote
or approval of any Partner, admit any Person to the Partnership
as an additional or substitute limited partner in the Partner-
ship, which admission shall be effective as of the date of the
occurrence of such event, and the business of the Partnership
shall be continued without dissolution.
(b) The Partnership shall be dissolved and its
affairs shall be wound up upon the occurrence of any of the
following events:
(i) The expiration of the term of the Partnership,
as provided in Section 1.4 hereof;
(ii) Upon the bankruptcy of the General Partner;
(iii) Upon the assignment by the General Partner of
its entire interest in the Partnership when the assignee is not
admitted to the Partnership as a general partner of the Part-
nership in accordance with Section 10.1, or the filing of a
certificate of dissolution or its equivalent, with respect to
the General Partner, or the revocation of the General Partner's
charter and the expiration of 90 days after the date of notice
to the General Partner of revocation without a reinstatement of
its charter, or any other event occurs which causes the General
Partner to cease to be a general partner of the Partnership
under the Act, unless the business of the Partnership is con-
tinued in accordance with the Act (any remaining general part-
ner of the Partnership is hereby authorized to and shall con-
tinue the business of the Partnership without dissolution);
(iv) in accordance with any Action;
(v) upon the entry of a decree of judicial dissolu-
tion under Section 17-802 of the Act; or
(vi) upon the written consent of all Partners.
(c) Upon dissolution of the Partnership, the Liqui-
dator (as defined below) shall promptly notify the Partners of
such dissolution.
Section 11.3 Liquidation. (a) In the event of the
dissolution of the Partnership for any reason, the General
Partner (or, if the Partnership is dissolved pursuant to Sec-
tion 11.2(b)(ii) or (iii), then a liquidating trustee appointed
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<PAGE> 36
by 66 2/3% in liquidation preference of the Preferred Securi-
ties (the General Partner or such Person so appointed is here-
inafter referred to as the "Liquidator")) shall commence to
wind up the affairs of the Partnership and to liquidate the
Partnership's assets; provided, however, that a reasonable time
shall be allowed for the orderly liquidation of the assets of
the Partnership and the satisfaction of liabilities to credi-
tors so as to enable the Partners to minimize the normal losses
attendant upon liquidation. The Partners shall continue to
share all income, losses and distributions during the period of
liquidation in accordance with Articles IV and V. Subject to
the provisions of this Article XI, the Liquidator shall have
full right and unlimited discretion to determine the time, man-
ner and terms of any sale or sales of Partnership property pur-
suant to such liquidation, giving due regard to the activity
and condition of the relevant market and general financial and
economic conditions.
(b) The Liquidator shall have all of the rights and
powers with respect to the assets and liabilities of the Part-
nership in connection with the liquidation and winding up of
the Partnership that the General Partner would have with re-
spect to the assets and liabilities of the Partnership during
the term of the Partnership, and the Liquidator is hereby
expressly authorized and empowered to execute any and all docu-
ments necessary or desirable to effectuate the liquidation and
winding up of the Partnership and the transfer of any assets.
(c) Notwithstanding the foregoing, a Liquidator
which is not the General Partner shall not by virtue of acting
capacity, be deemed a Partner in the Partnership or have any of
the economic interests in the Partnership of a Partner; and such
Liquidator may be compensated for its services to the Partnership
at normal, customary and competitive rates for its services to the
Partnership as reasonably determined by a majority in interest
of the Limited Partners.
Section 11.4 Distribution in Liquidation. Upon the
winding up of the Partnership, the assets of the Partnership
shall be distributed in the following order of priority:
(i) to creditors of the Partnership, including Pre-
ferred Security Holders who are creditors, to the extent
otherwise permitted by law, in satisfaction of the liabil-
ities of the Partnership (whether by payment or the making
of reasonable provision for payment thereof);
(ii) to the Holders of each series of Preferred Securities
in accordance with the terms of the Action establishing such series of
Preferred Securities; and
(iii) to the remaining Partners in proportion to such Partners'
positive Capital Account balances.
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Section 11.5 Rights of Limited Partners. Each Lim-
ited Partner shall look solely to the assets of the Partnership
for all distributions with respect to the Partnership and such
Partner's capital contribution (including return thereof), and
such Partner's share of profits or losses thereof, and shall
have no recourse therefor (upon dissolution or otherwise)
against the General Partner. No Partner shall have any right
to demand or receive property other than cash upon dissolution
and termination of the Partnership.
Section 11.6 Termination. The Partnership shall
terminate when all of the assets of the Partnership shall have
been disposed of and the assets shall have been distributed as
provided in Section 11.4, and the Liquidator has executed and
caused to be filed a certificate of cancellation of the Cer-
tificate.
ARTICLE XII
AMENDMENTS AND MEETINGS
Section 12.1 Amendments. Except as otherwise pro-
vided in this Agreement or by any applicable terms of any
Action establishing a series of Preferred Securities, this
Agreement may be amended by, and only by, a written instrument
executed by the General Partner; provided, however, that (i) no
amendment shall be made, and any such purported amendment shall
be void and ineffective, to the extent the result thereof would
be to cause the Partnership to be treated as anything other
than a partnership for purposes of United States income taxa-
tion and (ii) any amendment which would adversely affect the
rights, privileges or preferences of any series of Preferred
Securities may be effected only as permitted by the terms of
such series of Preferred Securities.
Section 12.2 Amendment of Certificate. In the event
this Agreement shall be amended pursuant to Section 12.1, the
General Partner shall amend the Certificate to reflect such
change if it deems such amendment of the Certificate to be nec-
essary or appropriate.
Section 12.3 Meetings of the Partners. (a) Meet-
ings of the Limited Partners who are Holders of any series or,
in the case of a class vote, of multiple series of Preferred
Securities may be called at any time by the General Partner (or
as provided in any Action establishing a series of Preferred
Securities) to consider and act on any matter on which Limited
Partners are entitled to act under the terms of this Agreement
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or the Act. The General Partner shall call a meeting of Hold-
ers of any series or, in the case of a class vote, multiple
series, if directed to do so by Holders of not less than 10% in
liquidation preference of the Preferred Securities of that
series. Such direction shall be given by delivering to the
General Partner one or more calls in a writing stating that the
signing Limited Partners wish to call a meeting and indicating
the general or specific purpose for which the meeting is to be
called. Any Limited Partners calling a meeting shall specify
in writing the LP Certificates held by the Limited Partners
exercising the right to call a meeting and only those specified
Interests shall be counted for purposes of determining whether
the required percentage set forth in the second sentence of
this paragraph has been met. Except to the extent otherwise
provided in any such Action, the following provisions shall
apply to meetings of Partners.
(b) Notice of any such meeting shall be given to all
Limited Partners having a right to vote thereat not less than 7
Business Days nor more than 60 days prior to the date of such
meeting. Whenever a vote, consent or approval of Limited Part-
ners is permitted or required under this Agreement, such vote,
consent or approval may be given at a meeting of Limited Part-
ners. Further, any action that may be taken at a meeting of
the Limited Partners may be taken without a meeting if a con-
sent in writing setting forth the action so taken is signed by
Limited Partners owning not less than the minimum Interests
that would be necessary to authorize or take such action at a
meeting at which all Limited Partners having a right to vote
thereon were present and voting. Prompt notice of the taking
of action without a meeting shall be given to the Limited Part-
ners entitled to vote who have not consented in writing. The
General Partner may specify that any written ballot submitted
to the Limited Partners for the purpose of taking any action
without a meeting shall be returned to the Partnership within
the time specified by the General Partner.
(c) Each Limited Partner may authorize any Person to
act for it by proxy on all matters in which a Limited Partner
is entitled to participate, including waiving notice of any
meeting, or voting or participating at a meeting. No proxy
shall be valid after the expiration of 11 months from the date
thereof unless otherwise provided in the proxy. Every proxy
shall be revocable at the pleasure of the Limited Partner exe-
cuting it. Except as otherwise provided herein, in any Action
or pursuant to Section 12.3(e), all matters relating to the
giving, voting or validity of proxies shall be governed by the
General Corporation Law of the State of Delaware relating to
proxies, and judicial interpretations thereunder, as if the
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<PAGE> 39
Partnership were a Delaware corporation and the Limited Part-
ners were stockholders of a Delaware corporation.
(d) Each meeting of Partners shall be conducted by
the General Partner or by such other Person that the General
Partner may designate.
(e) The General Partner, in its sole discretion,
shall establish all other provisions relating to meetings of
Limited Partners, including notice of the time, place or pur-
pose of any meeting at which any matter is to be voted on by
any Limited Partners, waiver of any such notice, action by con-
sent without a meeting, the establishment of a record date,
quorum requirements, voting in person or by proxy or any other
matter with respect to the exercise of any such right to vote.
ARTICLE XIII
MISCELLANEOUS
Section 13.1 Notices. All notices provided for in
this Agreement shall be in writing, duly signed by the party
giving such notice, and shall be delivered, telecopied or
mailed by registered or certified mail, as follows:
(a) if given to the Partnership, in care of the Gen-
eral Partner at the Partnership's mailing address set forth
below:
Transamerica Delaware, L.P.
c/o Transamerica Corporation
600 Montgomery Street
San Francisco, California 94111
Attention: Corporate Secretary
(b) if given to the General Partner, at its mailing
address set forth below:
Transamerica Corporation
600 Montgomery Street
San Francisco, California 94111
Attention: Corporate Secretary
(c) if given to any other Partner, at the address
set forth on the books and records of the Partnership.
All such notices shall be deemed to have been given,
in the case of the Partnership or the General Partners, when
received in person, telecopied with receipt confirmed, or mailed
by first calss mail, postage prepaid.
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<PAGE> 40
Section 13.2 Entire Agreement. This Agreement con-
stitutes the entire agreement among the parties. It supersedes
any prior agreement or understandings among them, and it may
not be modified or amended in any manner other than as set
forth herein.
Section 13.3 Governing Law. This Agreement and the
rights of the parties hereunder shall be governed by and inter-
preted in accordance with the law of the State of Delaware and
all rights and remedies shall be governed by such laws without
regard to principles of conflict of laws.
Section 13.4 Effect. Except as herein otherwise
specifically provided, this Agreement shall be binding upon and
inure to the benefit of the parties and their legal representa-
tives, successors and assigns.
Section 13.5 Pronouns and Number. Wherever from the
context it appears appropriate, each term stated in either the
singular or the plural shall include the singular and the plu-
ral, and pronouns stated in either the masculine, feminine or
neuter shall include the masculine, feminine and neuter.
Section 13.6 Captions and Headings. Captions and
headings contained in this Agreement are inserted only as a
matter of convenience and in no way define, limit or extend the
scope or intent of this Agreement or any provision hereof.
Section 13.7 Partial Enforceability. If any provi-
sion of this Agreement, or the application of such provision to
any Person or circumstance, shall be held invalid, the remain-
der of this Agreement, or the application of such provision to
persons or circumstances other than those to which it is held
invalid, shall not be affected thereby.
Section 13.8 Counterparts. This Agreement may con-
tain more than one counterpart of the signature page and this
Agreement may be executed by the affixing of the signature of
each of the Partners to one of such counterpart signature
pages. All of such counterpart signatures pages shall be read
as though one, and they shall have the same force and effect as
though all of the signers had signed a single signature page.
Section 13.9 Waiver of Partition. Each Partner
hereby irrevocably waives any and all rights (if any) that such
Partner may have to maintain any action for partition of any of
the Partnership's property.
Section 13.10 Remedies. The failure of any party to
seek redress for violation of, or to insist upon the strict
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<PAGE> 41
performance of, any provision of this Agreement shall not pre-
vent a subsequent act, which would have originally constituted
a violation, from having the effect of an original violation.
The rights and remedies provided by this Agreement are cumula-
tive and the use of any one right or remedy by any party shall
not preclude or waive its right to use any or all other rem-
edies. Said rights and remedies are given in addition to any
other rights the parties may have by law, statute, ordinance or
otherwise.
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the date first above stated.
General Partner:
TRANSAMERICA CORPORATION,
a Delaware corporation
By:
--------------------------------
Name:
Title:
Initial Limited Partner:
TRANSAMERICA LP HOLDINGS CORP.,
a Delaware corporation
By:
--------------------------------
Name:
Title:
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<PAGE> 42
Annex A
Certificate Number Number of Preferred Securities
R-1
CUSIP NO.
Certificate Evidencing Preferred Securities
of
Transamerica Delaware, L.P.
____ Preferred Securities, Series _
(liquidation preference $__ per Preferred Security)
Transamerica Delaware, L.P., a limited partnership
formed under the laws of the State of Delaware (the "Partner-
ship"), hereby certifies that __________ (the "Holder") is the
registered owner of _____ (_____) preferred securities of the
Partnership representing limited partner interests in the Part-
nership of a series designated the __________ Preferred Securi-
ties, Series _ (liquidation preference $__ per Preferred Secu-
rity) (the "Series _ Preferred Securities"). The Series _ Pre-
ferred Securities are fully paid and nonassessable limited
partner interests in the Partnership, as to which the limited
partners of the Partnership who hold the Series _ Preferred
Securities (the "Preferred Security Holders"), in their capaci-
ties as limited partners of the Partnership, will, assuming
such Preferred Security Holders do not participate in the con-
trol of the business of the Partnership, have no liability
in excess of their obligations to make payments provided for
in the Limited Partnership Agreement (as defined below) and
their share of the Partnership's assets and undistributed
profits (subject to the obligation of a Preferred Security
Holder to repay any funds wrongfully distributed to it) and
are transferable on the books and records of the Partnership,
in person or by a duly authorized attorney, upon surrender of
this certificate duly endorsed and in proper form for transfer.
The designations, rights, privileges, restrictions, preferences
and other terms and provisions of the Series _ Preferred Securities
are set forth in, and this certificate and the Series _ Preferred
Securities represented hereby are issued and shall in all respects
be subject to the terms and provisions of, the Amended and Re-
stated Agreement of Limited Partnership of the Partnership
dated as of _______, 1994, as the same may be amended from time
to time (the "Limited Partnership Agreement") including the Action
of the General Partner taken pursuant thereto authorizing the
issuance of the Series _ Preferred Securities and determining
<PAGE> 43
the designations, rights, privileges, restrictions, preferences
and other terms and provisions regarding Dividends, voting,
return of capital and otherwise, and other matters relating to
the Series _ Preferred Securities. Capitalized terms used
herein but not defined shall have the meaning given them in the
Limited Partnership Agreement or the Action. The Holder is
entitled to the benefits of the Guarantee Agreement of Trans-
america Corporation, a Delaware corporation ("Transamerica"),
dated as of _______, 1994 (the "Guarantee") to the extent pro-
vided therein. The Partnership will furnish a copy of the
Limited Partnership Agreement, the Action and the Guarantee to
the Holder without charge upon written request to the Partner-
ship at its principal place of business or registered office.
Upon receipt of this certificate, the Holder is
admitted to the Partnership as a Limited Partner, is bound by
the Limited Partnership Agreement and is entitled to the ben-
efits thereunder.
IN WITNESS WHEREOF, the Partnership has executed this
certificate this day of _______, 199_.
TRANSAMERICA DELAWARE, L.P.
By: TRANSAMERICA CORPORATION,
its General Partner
By:
------------------------------------
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<PAGE> 1
(DRAFT - 10/6/94)
EXHIBIT 4.9
ACTION OF GENERAL PARTNER
OF TRANSAMERICA DELAWARE, L.P.
CREATING THE
% CUMULATIVE MONTHLY INCOME PREFERRED SECURITIES, SERIES ___
Pursuant to Section 6.1 of the Amended and Restated Agreement
of Limited Partnership of Transamerica Delaware, L.P. dated as of ______, 1994
(as amended from time to time, the "Partnership Agreement"), Transamerica
Corporation, as general partner (the "General Partner") of Transamerica
Delaware, L.P., a Delaware limited partnership (the "Partnership"), desiring to
state the designations, rights, privileges, restrictions, preferences and other
terms and provisions of a new series of Preferred Securities, hereby authorizes
and establishes such new series of Preferred Securities according to the
following terms and conditions (each capitalized term used but not defined
herein having the meaning set forth in the Partnership Agreement):
1. Designation and Number. ________ Preferred Securities of
the Partnership with an aggregate liquidation preference of $______ million
($_,000,000) and a liquidation preference of $25 per Preferred Security, are
hereby designated as "___% Cumulative Monthly Income Preferred Securities,
Series ___" (hereinafter called the "Series___Preferred Securities"). The LP
Certificates evidencing the Series___Preferred Securities shall be
substantially in the form attached hereto as Exhibit ___. The proceeds of the
Series___Preferred Securities shall be loaned to the General Partner in return
for ___% Junior Subordinated Deferrable Interest Debentures, Series___(the
"Series___Junior Subordinated Debentures") in an aggregate principal amount
equal to the aggregate liquidation preference of the Series___Preferred
Securities, bearing interest at an annual rate equal to the annual Dividend
rate on the Series___Preferred Securities and having certain payment and
redemption provisions which correspond to the payment and redemption provisions
of the Series___Preferred Securities.
2. Dividends. (a) Dividends payable on each Series ___
Preferred Security will be fixed at a rate per annum of __% of the stated
liquidation preference of $25 per Series___Preferred Security. Dividends in
arrears for more than one month will bear interest monthly thereon at the rate
per annum of __% thereof. The term "Dividends" as used herein includes any
such interest payable unless otherwise stated. The amount of Dividends payable
for any period will be computed for any full monthly Dividend period on the
basis of a 360-day year of twelve 30-day months, and for any period shorter
than a full
<PAGE> 2
monthly Dividend period for which Dividends are computed, Dividends will be
computed on the basis of the actual number of days elapsed in such period.
(b) Dividends on the Series___Preferred Securities will
be cumulative, will accrue from the date of initial issuance and will be
payable monthly in arrears, on the last day of each calendar month of each
year, commencing _______, 1994, when, as and if determined to be so payable by
Transamerica Corporation, in its capacity as General Partner, except as
otherwise described below. Transamerica Corporation has the right under the
indenture for the Series___Junior Subordinated Debentures (the "Indenture") to
extend the interest payment period from time to time on the Series___Junior
Subordinated Debentures to a period not exceeding 60 consecutive months (each
an "Extension Period") and, as a consequence, monthly Dividends on the Series__
Preferred Securities would be deferred (but would continue to accrue with
interest thereon) by the Partnership during any such Extension Period. Prior
to the termination of any such Extension Period, Transamerica Corporation may
further extend such Extension Period, provided that such Extension Period
together with all such previous and further extensions thereof may not exceed
60 consecutive months. Upon the termination of any Extension Period and the
payment of all amounts then due, Transamerica Corporation may select a new
Extension Period, subject to the above requirements.
(c) Dividends on the Series___Preferred Securities will
be payable to the Holders thereof as they appear on the books and records of
the Partnership on the relevant record dates, which, as long as the Series___
Preferred Securities remain in book-entry-only form, will be one Business Day
prior to the relevant payment dates. Subject to any applicable laws and
regulations and the provisions of the Partnership Agreement, each such payment
will be made as described under the heading "Description of the Series___
Preferred Securities - Book-Entry-Only Issuance - The Depository Trust Company"
in the prospectus for the Series___Preferred Securities. In the event the
Series___Preferred Securities shall not continue to remain in book-entry-only
form, the General Partner shall have the right to select relevant record dates,
which shall be more than one Business Day prior to the relevant payment dates.
In the event that any date on which Dividends are payable on the Series____
Preferred Securities is not a Business Day, then payment of the Dividend
payable on such date will be made on the next succeeding day that is a Business
Day (and without any interest or other payment in respect of any such delay)
except that, if such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business
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<PAGE> 3
Day, in each case with the same force and effect as if made on such date.
3. Certain Restrictions on the Partnership. If Dividends
have not been paid in full on the Series___Preferred Securities, the
Partnership shall not:
(i) declare, pay, or set aside for payment, any Dividends
on any other series of Preferred Securities, unless the amounts of any
Dividends declared and paid on any other series of Preferred
Securities and on the Series___Preferred Securities are on a pro rata
basis on the dates such Dividends are paid on such other series of
Preferred Securities, so that
(x) the aggregate amount of Dividends paid on the
Series___Preferred Securities bears to the aggregate amount of
Dividends paid on such other series of Preferred Securities
the same ratio as
(y) the aggregate of all accrued and unpaid
Dividends in respect of the Series___Preferred Securities
bears to the aggregate of all accrued and unpaid Dividends in
respect of such other series of Preferred Securities; or
(ii) redeem, purchase or otherwise acquire any other
Preferred Securities;
until, in each case, such time as all accrued and unpaid Dividends on the
Series___Preferred Securities shall have been paid in full for all Dividend
periods terminating on or prior to, in the case of clause (i), such payment
and, in the case of clause (ii), the date of such redemption, purchase or
acquisition.
4. Liquidation Distribution Upon Dissolution. In the event
of any voluntary or involuntary dissolution, winding-up or termination of the
Partnership, the Holders of the Series___Preferred Securities at the time will
be entitled to receive out of the assets of the Partnership available for
distribution to Partners after satisfaction of liabilities of creditors as
required by the Act, before any distribution of assets is made to the General
Partner, but together with the Holders of every other series of Preferred
Securities outstanding, an amount equal to, in the case of Holders of Series___
Preferred Securities, the aggregate of the stated liquidation preference of $25
per Series___Preferred Security plus accrued and unpaid Dividends thereon to
the date of payment (such amount being the "Liquidation Distribution"), unless,
in connection with such
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<PAGE> 4
dissolution, winding-up or termination, Series___Junior Subordinated Debentures
in an aggregate principal amount equal to the stated liquidation preference of
such Series ___ Preferred Securities, and bearing accrued and unpaid interest in
an amount equal to the accrued and unpaid Dividends on such Series___Preferred
Securities, shall be distributed on a pro rata basis to the Holders of the
Series___Preferred Securities.
If, upon any such dissolution, the Liquidation Distribution
can be paid only in part because the Partnership has insufficient assets
available to pay in full the aggregate Liquidation Distribution and the
aggregate maximum liquidation distributions on any other series of Preferred
Securities, then the amounts payable directly by the Partnership on the Series
___Preferred Securities and on such other series of Preferred Securities shall
be paid in cash or in kind on a pro rata basis, so that
(x) the aggregate amount paid in respect of the
Liquidation Distribution bears to the aggregate amount paid as
liquidation distributions on the other series of Preferred Securities
the same ratio as
(y) the aggregate Liquidation Distribution bears to the
aggregate maximum liquidation distributions on the other series of
Preferred Securities.
5. Redemption. (a) The Series___Preferred Securities shall
be redeemable, at the option of the Partnership in whole or in part from time
to time, on or after ________________, 1999, upon not less than 30 nor more
than 60 days' notice, at a redemption price of $25 per Series___Preferred
Security plus an amount equal to accrued and unpaid Dividends thereon to the
date fixed for redemption, payable in cash (the "Redemption Price"). In the
event that fewer than all the outstanding Series ___ Preferred Securities are to
be so redeemed, the Series ___ Preferred Securities to be redeemed will be
selected as described in Section 5(f)(ii) below. If a partial redemption would
result in the delisting of the Series___Preferred Securities by any national
securities exchange or other organization on which the Series___Preferred
Securities are then listed, the Partnership may only redeem the Series___
Preferred Securities in whole.
(b) If at any time Transamerica Corporation (1) pays at
maturity or (2) redeems or purchases Series___Junior Subordinated Debentures,
the proceeds from such payment, purchase or redemption of such Series___Junior
Subordinated Debentures shall be applied to redeem Series___Preferred
Securities at the
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<PAGE> 5
Redemption Price upon not less than 30 nor more than 60 days' notice.
(c) If a Tax Event or an Investment Company Event (each as
hereinafter defined, and each a "Special Event") shall occur and be continuing,
the General Partner shall elect to either (x) redeem the Series ___Preferred
Securities in whole (and not in part), upon not less than 30 or more than 60
days' notice at the Redemption Price, within 90 days following the occurrence
of such Special Event; provided that, if and as long as at the time there is
available to the General Partner the opportunity to eliminate, within such
90-day period, the Special Event by taking some ministerial action, such as
filing a form or making an election, or pursuing some other similar reasonable
measure that has no adverse effect on the Partnership or Transamerica
Corporation, the General Partner will pursue such measure in lieu of
redemption, or (y) dissolve the Partnership and, after satisfaction of
creditors as required by the Act, cause Series ___Junior Subordinated Debentures
to be distributed to the Holders of the Series ___Preferred Securities in
liquidation of the Partnership, within 90 days following the occurrence of such
Special Event. In the case of a Tax Event, the General Partner may, as an
alternative to electing to redeem the Series ___Preferred Securities or
dissolving the Partnership, elect to cause the Series ___Preferred Securities to
remain outstanding.
"Tax Event" means that the General Partner shall have obtained
an opinion of nationally recognized independent tax counsel experienced in such
matters to the effect that on or after the date of issuance of the Series___
Preferred Securities, as a result of (a) any amendment to, or change (including
any announced prospective change) in, the laws (or any regulations thereunder)
of the United States or any political subdivision or taxing authority thereof
or therein, (b) any amendment to, or change in, an interpretation or
application of any such laws or regulations by any legislative body, court,
governmental agency or regulatory authority (including the enactment of any
legislation and the publication of any judicial decision or regulatory
determination), (c) any interpretation or pronouncement that provides for a
position with respect to such laws or regulations that differs from the
theretofore generally accepted position or (d) any action taken by any
governmental agency or regulatory authority, which amendment or change is
enacted, promulgated, issued or effective or which interpretation or
pronouncement is issued or announced or which action is taken, in each case on
or after the date of issuance of the Series ___Preferred Securities, there is
more than an insubstantial risk that (i) the Partnership is subject to federal
income tax with respect to interest accrued or received on
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<PAGE> 6
the Series ___Junior Subordinated Debentures, (ii) the Partnership is subject to
more than a de minimis amount of taxes, duties or other governmental charges,
or (iii) interest payable by Transamerica Corporation to the Partnership on the
Series ___Junior Subordinated Debentures will not be deductible by Transamerica
Corporation for federal income tax purposes.
"Investment Company Event" means the occurrence of a change in
law or regulation or a change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority (a "Change in 1940 Act Law") to the effect that the Partnership is or
will be considered an "investment company" which is required to be registered
under the Investment Company Act of 1940, as amended (the "1940 Act"), which
Change in 1940 Act Law becomes effective on or after the date of issuance of
the Series ___Preferred Securities; provided that no Investment Company Event
shall be deemed to have occurred if the General Partner obtains a written
opinion of nationally recognized independent counsel to the Partnership
experienced in practice under the 1940 Act to the effect that the General
Partner has successfully issued an additional or supplemental irrevocable and
unconditional guarantee or taken such other actions as may be necessary so
that, in the opinion of such counsel, notwithstanding such Change in 1940 Act
Law, the Partnership is not required to be registered as an "investment
company" within the meaning of the 1940 Act. In case of any uncertainty
regarding an Investment Company Event, the good faith determination of the
General Partner (based on the advice of counsel) shall be conclusive.
After the date fixed for any distribution of Series ___Junior
Subordinated Debentures, upon dissolution of the Partnership, (i) the Series___
Preferred Securities will no longer be deemed to be outstanding, (ii) The
Depository Trust Company (the "Depository") or its nominee, as the record
Holder of the Series ___Preferred Securities, will receive a registered global
certificate or certificates representing the Series ___Junior Subordinated
Debentures to be delivered upon such distribution and (iii) any certificates
representing Series ___Preferred Securities not held by the Depository or its
nominee will be deemed to represent Series ___Junior Subordinated Debentures
having a principal amount equal to the stated liquidation preference of such
Series ___Preferred Securities, and bearing accrued and unpaid interest in an
amount equal to the accrued and unpaid Dividends on such Series ___Preferred
Securities until such certificates are presented to Transamerica Corporation or
its agent for transfer or reissuance.
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<PAGE> 7
(d) The Partnership may not redeem fewer than all the
outstanding Series ___Preferred Securities unless all accrued and unpaid
Dividends have been paid on all Series ___Preferred Securities for all monthly
Dividend periods terminating on or prior to the date of redemption.
(e) Redemption or Exchange Procedures. (i) Notice of any
redemption (a "Notice of Redemption") of, or notice of distribution of Series__
Junior Subordinated Debentures in exchange for, the Series ___Preferred
Securities will be given by the Partnership by mail to each Holder of Series ___
Preferred Securities to be redeemed or exchanged not fewer than 30 nor more
than 60 days prior to the date fixed for redemption or exchange thereof;
provided, that no such notice shall be required in the case of a redemption of
Series ___Preferred Securities resulting from payment at maturity of the Series
___Debentures as contemplated in paragraph 5(b)(1) above, the redemption date
for the Series ___Preferred Securities being the same as such maturity date in
such case. For purposes of the calculation of the date of redemption or
exchange and the dates on which notices are given pursuant to this paragraph
(e)(i), a Notice of Redemption or notice of distribution shall be deemed to be
given on the day such notice is first mailed by first-class mail, postage
prepaid, to Holders of Series___Preferred Securities. Each Notice of
Redemption or notice of distribution shall be addressed to the Holders of
Series ___Preferred Securities at the address of each such Holder appearing in
the books and records of the Partnership. No defect in the Notice of
Redemption or notice of distribution or in the mailing of either thereof with
respect to any Holder shall affect the validity of the redemption or exchange
proceedings with respect to any other Holder.
(ii) In the event that fewer than all the outstanding Series
___Preferred Securities are to be redeemed, the Series ___Preferred
Securities to be redeemed will be selected in accordance with paragraph (e)(iv)
below or, in the event that Series___Preferred Securities are not held by the
Depository, by lot in such other manner as the General Partner shall deem fair
or appropriate.
(iii) If the Partnership gives a Notice of Redemption in
respect of Series___Preferred Securities (which notice will be irrevocable)
then, by 12:00 noon, New York City time, on the redemption date, the
Partnership will deposit irrevocably with the Depository funds sufficient to
pay the applicable Redemption Price and will give the Depositary irrevocable
instructions and authority to pay the Redemption Price to the Holders of the
Series___Preferred Securities. If Notice of
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<PAGE> 8
Redemption shall have been given and funds deposited as required, then upon the
date of such deposit, all rights of Holders of such Series___Preferred
Securities so called for redemption will cease, except the right of the Holders
of such Series___Preferred Securities to receive the Redemption Price, but
without interest on such Redemption Price. Neither the General Partner nor the
Partnership shall be required to register or cause to be registered the
transfer of any Series___Preferred Securities which have been so called for
redemption. In the event that any date fixed for redemption of Series___
Preferred Securities is not a Business Day, then payment of the Redemption
Price payable on such date will be made on the next succeeding day that is a
Business Day (and without any interest or other payment in respect of any such
delay) except that, if such Business Day falls in the next calendar year, such
payment will be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date fixed for redemption.
In the event that payment of the Redemption Price in respect of Series___
Preferred Securities is improperly withheld or refused and not paid either by
the Partnership or by Transamerica Corporation pursuant to the Guarantee
described in the Prospectus for the Series___Preferred Securities (the
"Guarantee"), Dividends on such Series___Preferred Securities will continue to
accrue, from the original redemption date to the date of payment, in which case
the actual payment date will be considered the date fixed for redemption for
purposes of calculating the Redemption Price.
(iv) Redemption or exchange notices shall be sent to the
Depository or its nominee. If less than all of the Series___Preferred
Securities are being redeemed, interests to be redeemed shall be determined in
accordance with the Depository's practice which at the date hereof is to
determine by lot the amount of the interest of each direct participant in such
series to be redeemed.
(v) Under the circumstances described in clause (y) of
Section 5(c) above and as of the date fixed for distribution of Series___Junior
Subordinated Debentures, any LP Certificates representing Series___Preferred
Securities outstanding shall be deemed to represent the Series___Junior
Subordinated Debentures to be distributed on such an exchange, and the
Series___Preferred Securities will no longer be deemed outstanding and may be
cancelled by the General Partner. The Series___Junior Subordinated Debentures
distributed upon such an exchange shall have an aggregate principal amount
equal to the aggregate liquidation preference of $25 per security of the Series
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<PAGE> 9
___Preferred Securities so exchanged, and shall bear interest at a rate per
annum equal to the annual Dividend rate on such Series___Preferred Securities
from the last date on which Dividends on such Series___Preferred Securities
were paid.
(vi) Subject to the foregoing and applicable law (including,
without limitation, United States federal securities laws), Transamerica
Corporation or any of its sub-sidiaries, including the Partnership, may at any
time and from time to time purchase outstanding Series___Preferred Securities
by tender, in the open market or by private agreement. If the Partnership
purchases and cancels any Series___Preferred Securities, the Series___Junior
Subordinated Debentures may be repaid in a principal amount equal to the
aggregate stated liquidation preference of the Series___Preferred Securities so
purchased, together with any accrued and unpaid interest on such principal
amount of Series___Junior Subordinated Debentures.
6. Voting Rights. (a) Except as provided under
paragraph 6(b) below and as otherwise required by law and the Partnership
Agreement, the Holders of the Series___Preferred Securities will have no voting
rights.
(b) If (i) arrearages on Dividends on the Series___Preferred
Securities shall exist for 18 consecutive monthly Dividend periods; (ii) an
Event of Default (as defined in the Indenture) occurs and is continuing on the
Series___Junior Subordinated Debentures; or (iii) Transamerica Corporation is
in default on any of its payment obligations under the Guarantee, then the
Holders of the Series___Preferred Securities, together with the Holders of any
other series of Preferred Securities having the right to vote for the
appointment of a special representative of the Partnership and the Limited
Partners (a "Special Representative") in such event, acting as a single class,
will be entitled by the vote of a majority in aggregate liquidation preference
of such Holders to appoint and authorize a Special Representative to enforce
the Partnership's creditor rights under the Series___Junior Subordinated
Debentures, to enforce the rights of the Holders of the Series___Preferred
Securities under the Guarantee and to enforce the rights of the Holders of the
Series___Preferred Securities to receive Dividends (if and to the extent
declared) on the Series___Preferred Securities. The Special Representative
shall not, by virtue of acting in such capacity, be admitted as a general
partner in the Partnership or otherwise be deemed to be a general partner in
the Partnership and shall have no liability for the debts, obligations or
liabilities of the Partnership. Not later than 30 days after such right to
appoint a Special Representative arises, the General Partner will convene a
meeting for the purpose of appointing a Special Representative. If the General
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<PAGE> 10
Partner fails to convene such meeting within such 30-day period, the Holders of
10% in liquidation preference of the outstanding Preferred Securities will be
entitled to convene such meeting. The provisions of the Partnership Agreement
relating to the convening and conduct of the meetings of the partners will
apply with respect to any such meeting. In the event that, at any such
meeting, Holders of less than a majority in aggregate liquidation preference of
Preferred Securities entitled to vote for the appointment of a Special
Representative vote for such appointment, no Special Representative shall be
appointed. Any Special Representative appointed shall cease to be a special
representative of the Partnership and the Limited Partners if the Partnership
(or Transamerica Corporation pursuant to the Guarantee) shall have paid in full
all accrued and unpaid Dividends on the Preferred Securities or such default or
breach, as the case may be, shall have been cured, and Transamerica
Corporation, in its capacity as the General Partner, shall continue the
business of the Partnership without dissolution. Notwithstanding the
appointment of any such Special Representative, Transamerica Corporation shall
continue as General Partner and shall retain all rights under the Indenture,
including the right to extend the interest payment period, and any such
extension would not constitute a default under the Indenture or enable a Holder
of Series___Preferred Securities to require the payment of a Dividend that has
not theretofore been declared.
In furtherance of the foregoing, and without limiting the
powers of any Special Representative so appointed and for the avoidance of any
doubt concerning the powers of the Special Representative, any Special
Representative, in its own name, in the name of the Partnership, in the name of
the Limited Partners, or otherwise, may institute or cause to be instituted a
proceeding, including, without limitation, any suit in equity, an action at law
or other judicial or administrative proceeding, to enforce the Partnership's
rights directly against Transamerica Corporation or any other obligor in
connection with such obligations to the same extent as the Partnership and on
behalf of the Partnership, and may prosecute such proceeding to judgment or
final decree, and enforce the same against Transamerica Corporation, or any
other obligor in connection with such obligations.
If any proposed amendment to the Partnership Agreement
provides for, or the General Partner otherwise proposes to effect, (i) any
action that would adversely affect the powers, preferences or special rights of
the Series___Preferred Securities, whether by way of amendment to the
Partnership Agreement or otherwise (including, without limitation, the
authorization or issuance of any limited partner interests in the Partnership
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<PAGE> 11
ranking, as to participation in the profits or Dividends or in the assets of
the Partnership, senior to the Series___Preferred Securities), or (ii) the
dissolution, winding-up or termination of the Partnership, other than (x) in
connection with the distribution of Series___Junior Subordinated Debentures
upon the occurrence of a Special Event or (y) as described in paragraph 8
below, then the Holders of outstanding Series___Preferred Securities will be
entitled to vote on such amendment or proposal of the General Partner (but not
on any other amendment or proposal) as a class with all other Holders of series
of Preferred Securities similarly affected, and such amendment or proposal
shall not be effective except with the approval of the Holders of 66-2/3% in
liquidation preference of such outstanding Preferred Securities having a right
to vote on the matter; provided, however, that no such approval shall be
required if the dissolution, winding-up or termination of the Partnership is
proposed or initiated upon the initiation of proceedings, or after proceedings
have been initiated, for the dissolution, winding-up, liquidation or
termination of Transamerica Corporation.
The rights attached to the Series___Preferred Securities will
be deemed not to be adversely affected by the creation or issue of, and no vote
will be required for the creation or issue of, any further limited partner
interests of the Partnership ranking pari passu with the Series___Preferred
Securities with regard to participation in the profits or Dividends or in the
assets of the Partnership. Holders of Series___Preferred Securities have no
preemptive rights.
So long as any Series___Junior Subordinated Debentures are
held by the Partnership, the General Partner shall not (i) direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or executing any trust or power conferred on the Trustee with respect
to such series, (ii) waive any past default that is waivable under Section 6.06
of the Indenture, (iii) exercise any right to rescind or annul a declaration
that the principal of all the Series___Junior Subordinated Debentures shall be
due and payable or (iv) consent to any amendment, modification or termination
of the Indenture or the Series___Junior Subordinated Debentures, where such
consent shall be required, without, in each case, obtaining the prior approval
of the Holders of at least 66-2/3% in liquidation preference of all series of
Preferred Securities who would be affected thereby if their Preferred
Securities were to be exchanged for Junior Subordinated Debentures, acting as a
single class; provided, however, that where a consent under the Indenture would
require the consent of each Holder affected thereby, no such consent shall be
given by the General Partner without the prior consent of each Holder of all
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<PAGE> 12
series of Preferred Securities who would be affected thereby if its Preferred
Securities were to be exchanged for Junior Subordinated Debentures. The
General Partner shall not revoke any action previously authorized or approved
by a vote of the Holders of any series of Preferred Securities who would be
affected thereby if their Preferred Securities were to be exchanged for Junior
Subordinated Debentures. The General Partner shall notify all Holders of the
Series___Preferred Securities of any notice of default received from the
Trustee under the Indenture with respect to the Series___Junior Subordinated
Debentures.
Any required approval of Holders of Series___Preferred
Securities may be given at a separate meeting of Holders of Preferred
Securities convened for such purpose, at a meeting of all of the Partners in
the Partnership or pursuant to written consent. The Partnership will cause a
notice of any meeting at which Holders of Series___Preferred Securities are
entitled to vote, or of any matter upon which action by written consent of such
Holders is to be taken, to be mailed to each Holder of record of Series___
Preferred Securities. Each such notice will include a statement setting forth
(i) the date of such meeting or the date by which such action is to be taken,
(ii) a description of any resolution proposed for adoption at such meeting on
which such Holders are entitled to vote or of such matter upon which written
consent is sought and (iii) instructions for the delivery of proxies or
consents.
No vote or consent of the Holders of Series___Preferred
Securities will be required for the Partnership to redeem and cancel Series___
Preferred Securities in accordance with the Partnership Agreement.
Notwithstanding that Holders of Series___Preferred Securities
are entitled to vote or consent under any of the circumstances described above,
any of the Series___Preferred Securities and any other series of Preferred
Securities that are entitled to vote or consent with such Series___Preferred
Securities as a single class at such time that are owned by Transamerica
Corporation or by any entity more than 50% of which is owned by Transamerica
Corporation, either directly or indirectly, shall not be entitled to vote or
consent and shall, for purposes of such vote or consent, be treated as if they
were not outstanding.
Holders of the Series___Preferred Securities will have no
rights to remove or replace the General Partner.
7. Ranking. So long as any Series___Preferred Securities are
outstanding, the Partnership will not issue any
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<PAGE> 13
partnership interests ranking, as to participation in the profits or Dividends
or in the assets of the Partnership, senior to the Series___Preferred
Securities.
8. Mergers, Consolidations or Amalgamations. The Partnership
may not consolidate, amalgamate, merge with or into, or be replaced by, or
convey, transfer or lease its properties and assets substantially as an
entirety to, any corporation or other body, except as described below. The
Partnership may, without the consent of the Holders of the Series___Preferred
Securities, consolidate, amalgamate, merge with or into, or be replaced by a
limited partnership, limited liability company or trust organized as such under
the laws of any state of the United States of America provided that (i) such
successor entity either (x) expressly assumes all of the obligations of the
Partnership under the Series___Preferred Securities or (y) substitutes for the
Series___Preferred Securities other securities having substantially the same
terms as the Series___Preferred Securities (the "Successor Securities") so long
as the Successor Securities rank, with respect to participation in the profits
and Dividends, and in the assets, of the successor entity, at least as high as
the Series___Preferred Securities rank with respect to participation in the
profits and Dividends, and in the assets, of the Partnership, (ii) Transamerica
Corporation expressly acknowledges such successor entity as the Holder of the
Series___Junior Subordinated Debentures, (iii) the Series___Preferred
Securities or any Successor Securities are listed, or any Successor Securities
will be listed upon notification of issuance, on any national securities
exchange or other organization on which the Series___Preferred Securities are
then listed, (iv) such merger, consolidation, amalgamation or replacement does
not cause the Series___Preferred Securities (including any Successor
Securities) to be downgraded by any nationally recognized statistical rating
organization, (v) such merger, consolidation, amalgamation or replacement does
not adversely affect the powers, preferences and other special rights of the
Holders of the Series___Preferred Securities (including any Successor
Securities) in any material respect (other than with respect to any dilution of
the Holders' interest in the new entity), (vi) such successor entity has a
purpose substantially identical to that of the Partnership, (vii) prior to such
merger, consolidation, amalgamation or replacement, Transamerica Corporation
has received an opinion of nationally recognized independent counsel to the
Partnership experienced in such matters to the effect that (x) such successor
entity will be treated as a partnership for federal income tax purposes, (y)
following such merger, consolidation, amalgamation or replacement, Transamerica
Corporation and such successor entity will be in compliance with the 1940 Act
without registering thereunder as an investment company, and (z) such
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<PAGE> 14
merger, consolidation, amalgamation or replacement will not adversely affect
the limited liability of the Holders of the Series___Preferred Securities and
(viii) Transamerica Corporation guarantees the obligations of such successor
entity under the Successor Securities at least to the extent provided by the
Guarantee.
This written Action shall constitute an Action for purposes of
the Partnership Agreement and shall be deemed for all purposes to be a part of
the Partnership Agreement.
IN WITNESS WHEREOF, the undersigned has executed this Action
of General Partner this __ day of October, 1994.
TRANSAMERICA CORPORATION,
GENERAL PARTNER
By:_________________________
Name:
Title:
<PAGE> 1
(DRAFT - 10/7/94)
EXHIBIT 4.10
ACTION OF GENERAL PARTNER
OF TRANSAMERICA DELAWARE, L.P.
CREATING THE
CUMULATIVE ADJUSTABLE RATE MONTHLY
INCOME PREFERRED SECURITIES, SERIES ___
Pursuant to Section 6.1 of the Amended and Restated Agreement
of Limited Partnership of Transamerica Delaware, L.P. dated as of ______, 1994
(as amended from time to time, the "Partnership Agreement"), Transamerica
Corporation, as general partner (the "General Partner") of Transamerica
Delaware, L.P., a Delaware limited partnership (the "Partnership"), desiring to
state the designations, rights, privileges, restrictions, preferences and other
terms and provisions of a new series of Preferred Securities, hereby authorizes
and establishes such new series of Preferred Securities according to the
following terms and conditions (each capitalized term used but not defined
herein having the meaning set forth in the Partnership Agreement):
1. Designation and Number. ________ Preferred Securities of
the Partnership with an aggregate liquidation preference of $______
million ($_,000,000) and a liquidation preference of $25 per Preferred
Security, are hereby designated as "Cumulative Adjustable Rate Monthly Income
Preferred Securities, Series ___" (hereinafter called the "Series ___Preferred
Securities"). The LP Certificates evidencing the Series ___Preferred Securities
shall be substantially in the form attached hereto as Exhibit A. The proceeds
of the Series ___Preferred Securities shall be loaned to the General Partner in
return for Adjustable Rate Junior Subordinated Deferrable Interest Debentures,
Series ___(the "Series ___Junior Subordinated Debentures") in an aggregate
principal amount equal to the aggregate liquidation preference of the Series
___Preferred Securities, bearing interest at an annual rate equal to the annual
Dividend rate on the Series ___Preferred Securities and having certain payment
and redemption provisions which correspond to the payment and redemption
provisions of the Series ___Preferred Securities.
2. Dividends. (a) Dividends on the Series ___Preferred
Securities will be cumulative, will accrue from the date of initial issuance
and will be payable monthly in arrears, on the last day of each calendar month
of each year, commencing _______, 1994, when, as and if determined to be so
payable by Transamerica Corporation, in its capacity as General Partner, except
as otherwise described below. Dividends in arrears for more than one month
will bear interest monthly thereon at the rate per annum equal to the Dividend
rate for each month during the period of arrearage. The term "Dividends" as
used herein
<PAGE> 2
includes any such interest payable unless otherwise stated. The amount of
Dividends payable for any period will be computed for any full monthly
Dividend period on the basis of a 360-day year of twelve 30-day months, and
for any period shorter than a full monthly Dividend period for which Dividends
are computed, Dividends will be computed on the basis of the actual number of
days elapsed in such period.
(b) The Dividend rate will be adjusted quarterly. The
rate for the initial period from the date of initial issuance to _____________,
1994 will be ____% per annum, which is equivalent to $________ per Series___
Preferred Security per annum. Thereafter, Dividends on the Series___Preferred
Securities will be payable at the "Applicable Rate" (as defined below) from
time to time in effect. Transamerica Corporation has the right under the
indenture for the Series___Junior Subordinated Debentures (the "Indenture") to
extend the interest payment period from time to time on the Series___Junior
Subordinated Debentures to a period not exceeding 60 consecutive months (each
an "Extension Period") and, as a consequence, monthly Dividends on the Series__
Preferred Securities would be deferred (but would continue to accrue with
interest thereon) by the Partnership during any such Extension Period. Prior
to the termination of any such Extension Period, Transamerica Corporation may
further extend such Extension Period, provided that such Extension Period
together with all such previous and further extensions thereof may not exceed
60 consecutive months. Upon the termination of any Extension Period and the
payment of all amounts then due, Transamerica Corporation may select a new
Extension Period, subject to the above requirements.
(c) Dividends on the Series___Preferred Securities will
be payable to the Holders thereof as they appear on the books and records of
the Partnership on the relevant record dates, which, as long as the Series___
Preferred Securities remain in book-entry-only form, will be one Business Day
prior to the relevant payment dates. Subject to any applicable laws and
regulations and the provisions of the Partnership Agreement, each such payment
will be made as described under the heading "Description of the Series___
Preferred Securities - Book-Entry-Only Issuance - The Depository Trust Company"
in the prospectus for the Series___Preferred Securities. In the event the
Series___Preferred Securities shall not continue to remain in book-entry-only
form, the General Partner shall have the right to select relevant record dates,
which shall be more than one Business Day prior to the relevant payment dates.
In the event that any date on which Dividends are payable on the Series___
Preferred Securities is not a Business Day, then payment of the
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<PAGE> 3
Dividend payable on such date will be made on the next succeeding day that is a
Business Day (and without any interest or other payment in respect of any such
delay) except that, if such Business Day is in the next succeeding calendar
year, such payment shall be made on the immediately preceding Business Day, in
each case with the same force and effect as if made on such date.
(d) Except as provided below in this paragraph, the
"Applicable Rate" for any quarter (other than the initial period) will be equal
to % of the Effective Rate (as defined below), but not less than % per
annum nor more than % per annum. The "Effective Rate" for any quarter will
be equal to the highest of the Treasury Bill Rate, the Ten Year Constant
Maturity Rate and the Thirty Year Constant Maturity Rate (each as defined
below) for such quarter. The Applicable Rate will be rounded to the nearest
five hundredth of a percent. In the event that the Partnership determines in
good faith that for any reason:
(i) any one of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate or the Thirty Year Constant Maturity Rate
cannot be determined for any quarter, then the Effective Rate for such
quarter will be equal to the higher of whichever two of such rates can
be so determined;
(ii) only one of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate and the Thirty Year Constant Maturity Rate can
be determined for any quarter, then the Effective Rate for such
quarter will be equal to whichever such rate can be so determined; or
(iii) none of the Treasury Bill Rate, the Ten Year Constant
Maturity Rate and the Thirty Year Constant Maturity Rate can be
determined for any quarter, then the Effective Rate for the preceding
quarter will be continued for such quarter.
Except as described below in this paragraph, the "Treasury
Bill Rate" for each quarter will be the arithmetic average of the two most
recent weekly per annum secondary market discount rates (or the one weekly per
annum secondary market discount rate, if only one such rate is published during
the relevant Calendar Period (as defined below)) for three-month U.S. Treasury
bills, as published weekly by the Federal Reserve Board (as defined below)
during the Calendar Period immediately preceding the last ten calendar days
preceding the quarter for which the dividend rate on the Series___Preferred
Securities is being determined. In the event that the Federal
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<PAGE> 4
Reserve Board does not publish such a weekly per annum secondary market
discount rate during any such Calendar Period, then the Treasury Bill Rate for
such quarter will be the arithmetic average of the two most recent weekly per
annum secondary market discount rates (or the one weekly per annum secondary
market discount rate, if only one such rate is published during the relevant
Calendar Period) for three-month U.S. Treasury bills, as published weekly
during such Calendar Period by any Federal Reserve Bank or by any U.S.
Government department or agency selected by the Partnership. In the event that
a per annum secondary market discount rate for three-month U.S. Treasury bills
is not published by the Federal Reserve Board or by any Federal Reserve Bank or
by any U.S. Government department or agency during such Calendar Period, then
the Treasury Bill Rate for such quarter will be the arithmetic average of the
two most recent weekly per annum secondary market discount rates (or the one
weekly per annum secondary market discount rate, if only one such rate is
published during the relevant Calendar Period) for all of the U.S. Treasury
bills then having remaining maturities of not less than 80 nor more than 100
days, as published during such Calendar Period by the Federal Reserve Board, or
if the Federal Reserve Board does not publish such rates, by any Federal
Reserve Bank or by any U.S. Government department or agency selected by the
Partnership. In the event that the Partnership determines in good faith that
for any reason no such U.S. Treasury bill rates are published as provided above
during such Calendar Period, then the Treasury Bill Rate for such quarter will
be the arithmetic average of the per annum secondary market discount rates
based upon the closing bids during such Calendar Period for each of the issues
of marketable non-interest-bearing U.S. Treasury securities with a remaining
maturity of not less than 80 nor more than 100 days from the date of each such
quotation, as chosen and quoted daily for each Business Day in New York City
(or less frequently if daily quotations are not generally available) to the
Partnership by at least three recognized dealers in U.S. Government securities
selected by the Partnership. In the event that the Partnership determines in
good faith that for any reason the Partnership cannot determine the Treasury
Bill Rate for any quarter as provided above in this paragraph, the Treasury
Bill Rate for such quarter will be the arithmetic average of the per annum
secondary market discount rate based upon the closing bids during such Calendar
Period for each of the issues of marketable interest-bearing U.S. Treasury
securities with a remaining maturity of not less than 80 nor more than 100
days, as chosen and quoted daily for each business day in New York City (or
less frequently if daily quotations are not generally available) to the
Partnership by at least three recognized dealers in U.S. Government securities
selected by the Partnership.
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<PAGE> 5
Except as described below in this paragraph, the "Ten Year
Constant Maturity Rate" for each quarter will be the arithmetic average of the
two most recent weekly per annum Ten Year Average Yields (as defined below) (or
the one weekly per annum Ten Year Average Yield, if only one such yield is
published during the relevant Calendar Period), as published weekly by the
Federal Reserve Board during the Calendar Period immediately preceding the last
ten calendar days preceding the quarter for which the dividend rate on the
Series___Preferred Securities is being determined. In the event that the
Federal Reserve Board does not publish such a weekly per annum Ten Year Average
Yield during such Calendar Period, then the Ten Year Constant Maturity Rate for
such quarter will be the arithmetic average of the two most recent weekly per
annum Ten Year Average Yields (or the one weekly per annum Ten Year Average
Yield, if only one such yield is published during the relevant Calendar
Period), as published weekly during such Calendar Period by any Federal Reserve
Bank or by any U.S. Government department or agency selected by the
Partnership. In the event that a per annum Ten Year Average Yield is not
published by the Federal Reserve Board or by any Federal Reserve Bank or by any
U.S. Government department or agency during such Calendar Period, then the Ten
Year Constant Maturity Rate for such quarter will be the arithmetic average of
the two most recent weekly per annum average yields to maturity (or the one
weekly per annum average yield to maturity, if only one such yield is published
during the relevant Calendar Period) for all of the actively traded marketable
U.S. Treasury fixed interest rate securities (other than Special Securities
(as defined below)) then having remaining maturities of not less than eight nor
more than twelve years, as published during such Calendar Period by the Federal
Reserve Board or, if the Federal Reserve Board does not publish such yields, by
any Federal Reserve Bank or by any U.S. Government department or agency
selected by the Partnership. In the event that the Partnership determines in
good faith that for any reason the Partnership cannot determine the Ten Year
Constant Maturity Rate for any quarter as provided above in this paragraph,
then the Ten Year Constant Maturity Rate for such quarter will be the
arithmetic average of the per annum average yields to maturity based upon the
closing bids during such Calendar Period for each of the issues of actively
traded marketable U.S. Treasury fixed interest rate securities (other than
Special Securities) with a final maturity date not less than eight or more than
twelve years from the date of each such quotation, as chosen and quoted daily
for each Business Day in New York City (or less frequently if daily quotations
are not generally available) to the Partnership by at least three recognized
dealers in U.S. Government securities selected by the Partnership.
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<PAGE> 6
Except as described below in this paragraph, the "Thirty Year
Constant Maturity Rate" for each quarter will be the arithmetic average of the
two most recent weekly per annum Thirty Year Average Yields (as defined below)
(or the one weekly per annum Thirty Year Average Yield, if only one such yield
is published during the relevant Calendar Period), as published weekly by the
Federal Reserve Board during the Calendar Period immediately preceding the last
ten calendar days preceding the quarter for which the dividend rate on the
Series___Preferred Securities is being determined. In the event that the
Federal Reserve Board does not publish such a weekly per annum Thirty Year
Average Yield during such Calendar Period, then the Thirty Year Constant
Maturity Rate for such quarter will be the arithmetic average of the two most
recent weekly per annum Thirty Year Average Yields (or the one weekly per annum
Thirty Year Average Yield, if only one such yield is published during the
relevant Calendar Period), as published weekly during such Calendar Period by
any Federal Reserve Bank or by any U.S. Government department or agency
selected by the Partnership. In the event that a per annum Thirty Year Average
Yield is not published by the Federal Reserve Board or by any Federal Reserve
Bank or by any U.S. Government department or agency during such Calendar
Period, then the Thirty Year Constant Maturity Rate for such quarter will be
the arithmetic average of the two most recent weekly per annum average yields
to maturity (or the one weekly per annum average yield to maturity, if only one
such yield is published during the relevant Calendar Period) for all of the
actively traded marketable U.S. Treasury fixed interest rate securities (other
than Special Securities) then having remaining maturities of not less than
twenty-eight nor more than thirty-two years, as published during such Calendar
Period by the Federal Reserve Board or, if the Federal Reserve Board does not
publish such yields, by any Federal Reserve Bank or by any U.S. Government
department or agency selected by the Partnership. In the event that the
Partnership determines in good faith that for any reason the Partnership cannot
determine the Thirty Year Constant Maturity Rate for any quarter as provided
above in this paragraph, then the Thirty Year Constant Maturity Rate for such
quarter will be the arithmetic average of the per annum average yields to
maturity based upon the closing bids during such Calendar Period for each of
the issues of actively traded marketable U.S. Treasury fixed interest rate
securities (other than Special Securities) with a final maturity date not less
than twenty-eight nor more than thirty-two years from the date of each such
quotation, as chosen and quoted daily for each Business Day in New
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<PAGE> 7
York City (or less frequently if daily quotations are not generally available)
to the Partnership by at least three recognized dealers in U.S. Government
securities selected by the Partnership.
The Treasury Bill Rate, the Ten Year Constant Maturity Rate
and the Thirty Year Constant Maturity Rate will each be rounded to the nearest
one hundredth of a percent.
The Applicable Rate with respect to each quarter (other than
the initial period) will be calculated as promptly as practicable by the
Partnership according to the appropriate method described above. The
Partnership will cause each Applicable Rate to be published in a newspaper of
general circulation in New York City before the commencement of the quarter to
which it applies and will cause notice of such Applicable Rate to be given to
The Depository Company (the "Depository"), New York, New York, the securities
depository for the Series___Preferred Securities.
As used above, the term "Calendar Period" means a period of
fourteen calendar days; the term "Federal Reserve Board" means the Board of
Governors of the Federal Reserve System; the term "Special Securities" means
securities which can, at the option of the Holder, be surrendered at face value
in payment of any federal estate tax or which provide tax benefits to the
Holder and are priced to reflect such tax benefits or which were originally
issued at a deep or substantial discount; the term "Ten Year Average Yield"
means the average yield to maturity for actively traded marketable U.S.
Treasury fixed interest rate securities adjusted to constant maturities of ten
years; and the term "Thirty Year Average Yield" means the average yield to
maturity for actively traded marketable U.S. Treasury fixed interest rate
securities adjusted to constant maturities of thirty years.
3. Certain Restrictions on the Partnership. If Dividends
have not been paid in full on the Series___Preferred Securities, the
Partnership shall not:
(i) declare, pay, or set aside for payment, any Dividends
on any other series of Preferred Securities, unless the amounts of any
Dividends declared and paid on any other series of Preferred
Securities and on the Series___Preferred Securities are on a pro rata
basis on the dates such Dividends are paid on such other series of
Preferred Securities, so that
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<PAGE> 8
(x) the aggregate amount of Dividends paid on the
Series___Preferred Securities bears to the aggregate amount of
Dividends paid on such other series of Preferred Securities
the same ratio as
(y) the aggregate of all accrued and unpaid
Dividends in respect of the Series___Preferred Securities
bears to the aggregate of all accrued and unpaid Dividends in
respect of such other series of Preferred Securities; or
(ii) redeem, purchase or otherwise acquire any other
Preferred Securities;
until, in each case, such time as all accrued and unpaid Dividends on the
Series___Preferred Securities shall have been paid in full for all Dividend
periods terminating on or prior to, in the case of clause (i), such payment
and, in the case of clause (ii), the date of such redemption, purchase or
acquisition.
4. Liquidation Distribution Upon Dissolution. In the event
of any voluntary or involuntary dissolution, winding-up or termination of the
Partnership, the Holders of the Series___Preferred Securities at the time will
be entitled to receive out of the assets of the Partnership available for
distribution to Partners after satisfaction of liabilities of creditors as
required by the Act, before any distribution of assets is made to the General
Partner, but together with the Holders of every other series of Preferred
Securities outstanding, an amount equal to, in the case of Holders of Series___
Preferred Securities, the aggregate of the stated liquidation preference of $25
per Series___Preferred Security plus accrued and unpaid Dividends thereon to
the date of payment (such amount being the "Liquidation Distribution"), unless,
in connection with such dissolution, winding-up or termination, Series___Junior
Subordinated Debentures in an aggregate principal amount equal to the stated
liquidation preference of such Series___Preferred Securities, and bearing
accrued and unpaid interest in an amount equal to the accrued and unpaid
Dividends on such Series___Preferred Securities, shall be distributed on a pro
rata basis to the Holders of the Series___Preferred Securities.
If, upon any such dissolution, the Liquidation Distribution
can be paid only in part because the Partnership has insufficient assets
available to pay in full the aggregate Liquidation Distribution and the
aggregate maximum liquidation distributions on any other series of Preferred
Securities, then the amounts payable directly by the Partnership on the
Series___
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<PAGE> 9
Preferred Securities and on such other series of Preferred Securities shall be
paid in cash or in kind on a pro rata basis, so that
(x) the aggregate amount paid in respect of the
Liquidation Distribution bears to the aggregate amount paid as
liquidation distributions on the other series of Preferred Securities
the same ratio as
(y) the aggregate Liquidation Distribution bears to the
aggregate maximum liquidation distributions on the other series of
Preferred Securities.
5. Redemption. (a) The Series___Preferred Securities shall
be redeemable, at the option of the Partnership in whole or in part from time
to time, on or after ________________, 1999, upon not less than 30 nor more
than 60 days' notice, at a redemption price of $25 per Series___Preferred
Security plus an amount equal to accrued and unpaid Dividends thereon to the
date fixed for redemption, payable in cash (the "Redemption Price"). In the
event that fewer than all the outstanding Series___Preferred Securities are to
be so redeemed, the Series___Preferred Securities to be redeemed will be
selected as described in Section 5(f)(ii) below. If a partial redemption would
result in the delisting of the Series___Preferred Securities by any national
securities exchange or other organization on which the Series___Preferred
Securities are then listed, the Partnership may only redeem the Series___
Preferred Securities in whole.
(b) If at any time Transamerica Corporation (1) pays at
maturity or (2) redeems or purchases Series___Junior Subordinated Debentures,
the proceeds from such payment, purchase or redemption of such Series___Junior
Subordinated Debentures shall be applied to redeem Series___Preferred
Securities at the Redemption Price upon not less than 30 nor more than 60 days'
notice.
(c) If a Tax Event or an Investment Company Event (each as
hereinafter defined, and each a "Special Event") shall occur and be continuing,
the General Partner shall elect to either (x) redeem the Series___Preferred
Securities in whole (and not in part), upon not less than 30 or more than 60
days' notice at the Redemption Price, within 90 days following the occurrence
of such Special Event; provided that, if and as long as at the time there is
available to the General Partner the opportunity to eliminate, within such
90-day period, the Special Event by taking some ministerial action, such as
filing a form or making an election, or pursuing some other similar reasonable
measure that has no adverse effect on the Partnership
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<PAGE> 10
or Transamerica Corporation, the General Partner will pursue such measure in
lieu of redemption, or (y) dissolve the Partnership and, after satisfaction of
creditors as required by the Act, cause Series___Junior Subordinated Debentures
to be distributed to the Holders of the Series___Preferred Securities in
liquidation of the Partnership, within 90 days following the occurrence of such
Special Event. In the case of a Tax Event, the General Partner may, as an
alternative to electing to redeem the Series___Preferred Securities or
dissolving the Partnership, elect to cause the Series___Preferred Securities to
remain outstanding.
"Tax Event" means that the General Partner shall have obtained
an opinion of nationally recognized independent tax counsel experienced in such
matters to the effect that on or after the date of issuance of the Series___
Preferred Securities, as a result of (a) any amendment to, or change (including
any announced prospective change) in, the laws (or any regulations thereunder)
of the United States or any political subdivision or taxing authority thereof
or therein, (b) any amendment to, or change in, an interpretation or
application of any such laws or regulations by any legislative body, court,
governmental agency or regulatory authority (including the enactment of any
legislation and the publication of any judicial decision or regulatory
determination), (c) any interpretation or pronouncement that provides for a
position with respect to such laws or regulations that differs from the
theretofore generally accepted position or (d) any action taken by any
governmental agency or regulatory authority, which amendment or change is
enacted, promulgated, issued or effective or which interpretation or
pronouncement is issued or announced or which action is taken, in each case on
or after the date of issuance of the Series___Preferred Securities, there is
more than an insubstantial risk that (i) the Partnership is subject to federal
income tax with respect to interest accrued or received on the Series___Junior
Subordinated Debentures, (ii) the Partnership is subject to more than a de
minimis amount of taxes, duties or other governmental charges, or (iii)
interest payable by Transamerica Corporation to the Partnership on the
Series___Junior Subordinated Debentures will not be deductible by Transamerica
Corporation for federal income tax purposes.
"Investment Company Event" means the occurrence of a change in
law or regulation or a change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority (a "Change in 1940 Act Law") to the effect that the Partnership is or
will be considered an "investment company" which is required to be registered
under the Investment Company Act of 1940, as amended
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<PAGE> 11
(the "1940 Act"), which Change in 1940 Act Law becomes effective on or after
the date of issuance of the Series___Preferred Securities; provided that no
Investment Company Event shall be deemed to have occurred if the General
Partner obtains a written opinion of nationally recognized independent counsel
to the Partnership experienced in practice under the 1940 Act to the effect
that the General Partner has successfully issued an additional or supplemental
irrevocable and unconditional guarantee or taken such other actions as may be
necessary so that, in the opinion of such counsel, notwithstanding such Change
in 1940 Act Law, the Partnership is not required to be registered as an
"investment company" within the meaning of the 1940 Act. In case of any
uncertainty regarding an Investment Company Event, the good faith determination
of the General Partner (based on the advice of counsel) shall be conclusive.
After the date fixed for any distribution of Series___Junior
Subordinated Debentures, upon dissolution of the Partnership, (i) the
Series___Preferred Securities will no longer be deemed to be outstanding, (ii)
The Depository or its nominee, as the record Holder of the Series___Preferred
Securities, will receive a registered global certificate or certificates
representing the Series___Junior Subordinated Debentures to be delivered upon
such distribution and (iii) any certificates representing Series___Preferred
Securities not held by the Depository or its nominee will be deemed to
represent Series___Junior Subordinated Debentures having a principal amount
equal to the stated liquidation preference of such Series___Preferred
Securities, and bearing accrued and unpaid interest in an amount equal to the
accrued and unpaid Dividends on such Series___Preferred Securities until such
certificates are presented to Transamerica Corporation or its agent for
transfer or reissuance.
(d) The Partnership may not redeem fewer than all the
outstanding Series___Preferred Securities unless all accrued and unpaid
Dividends have been paid on all Series___Preferred Securities for all monthly
Dividend periods terminating on or prior to the date of redemption.
(e) Redemption or Exchange Procedures. (i) Notice of any
redemption (a "Notice of Redemption") of, or notice of distribution of
Series___Junior Subordinated Debentures in exchange for, the Series___Preferred
Securities will be given by the Partnership by mail to each Holder of
Series___Preferred Securities to be redeemed or exchanged not fewer than 30
nor more than 60 days prior to the date fixed for redemption or
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<PAGE> 12
exchange thereof; provided, that no such notice shall be required in the case
of a redemption of Series___Preferred Securities resulting from payment at
maturity of the Series___Debentures as contemplated in paragraph 5(b)(1) above,
the redemption date for the Series___Preferred Securities being the same as
such maturity date in such case. For purposes of the calculation of the date
of redemption or exchange and the dates on which notices are given pursuant to
this paragraph (e)(i), a Notice of Redemption or notice of distribution shall
be deemed to be given on the day such notice is first mailed by first-class
mail, postage prepaid, to Holders of Series___Preferred Securities. Each
Notice of Redemption or notice of distribution shall be addressed to the
Holders of Series___Preferred Securities at the address of each such Holder
appearing in the books and records of the Partnership. No defect in the Notice
of Redemption or notice of distribution or in the mailing of either thereof
with respect to any Holder shall affect the validity of the redemption or
exchange proceedings with respect to any other Holder.
(ii) In the event that fewer than all the outstanding
Series___Preferred Securities are to be redeemed, the Series___Preferred
Securities to be redeemed will be selected in accordance with paragraph (e)(iv)
below or, in the event that Series___Preferred Securities are not held by the
Depository, by lot in such other manner as the General Partner shall deem fair
or appropriate.
(iii) If the Partnership gives a Notice of Redemption in
respect of Series___Preferred Securities (which notice will be irrevocable)
then, by 12:00 noon, New York City time, on the redemption date, the
Partnership will deposit irrevocably with the Depository funds sufficient to
pay the applicable Redemption Price and will give the Depository irrevocable
instructions and authority to pay the Redemption Price to the Holders of the
Series___Preferred Securities. If Notice of Redemption shall have been given
and funds deposited as required, then upon the date of such deposit, all rights
of Holders of such Series___Preferred Securities so called for redemption will
cease, except the right of the Holders of such Series___Preferred Securities to
receive the Redemption Price, but without interest on such Redemption Price.
Neither the General Partner nor the Partnership shall be required to register
or cause to be registered the transfer of any Series___Preferred Securities
which have been so called for redemption. In the event that any date fixed for
redemption of Series___Preferred Securities is not a Business Day, then payment
of the Redemption Price payable on such date will be made on the next
succeeding day that is a Business Day (and without any interest or other
payment in respect of any such delay) except that, if
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<PAGE> 13
such Business Day falls in the next calendar year, such payment will be made on
the immediately preceding Business Day, in each case with the same force and
effect as if made on such date fixed for redemption. In the event that payment
of the Redemption Price in respect of Series___Preferred Securities is
improperly withheld or refused and not paid either by the Partnership or by
Transamerica Corporation pursuant to the Guarantee described in the Prospectus
for the Series___Preferred Securities (the "Guarantee"), Dividends on such
Series___Preferred Securities will continue to accrue, from the original
redemption date to the date of payment, in which case the actual payment date
will be considered the date fixed for redemption for purposes of calculating
the Redemption Price.
(iv) Redemption or exchange notices shall be sent to the
Depository or its nominee. If less than all of the Series___Preferred
Securities are being redeemed, interests to be redeemed shall be determined in
accordance with the Depository's practice which at the date hereof is to
determine by lot the amount of the interest of each direct participant in such
series to be redeemed.
(v) Under the circumstances described in clause (y) of
Section 5(c) above and as of the date fixed for distribution of Series___Junior
Subordinated Debentures, any LP Certificates representing Series___Preferred
Securities outstanding shall be deemed to represent the Series___Junior
Subordinated Debentures to be distributed on such an exchange, and the
Series___Preferred Securities will no longer be deemed outstanding and may be
cancelled by the General Partner. The Series___Junior Subordinated Debentures
distributed upon such an exchange shall have an aggregate principal amount
equal to the aggregate liquidation preference of $25 per security of the
Series___Preferred Securities so exchanged, and shall bear interest at a rate
per annum equal to the annual Dividend rate on such Series___Preferred
Securities from the last date on which Dividends on such Series___Preferred
Securities were paid.
(vi) Subject to the foregoing and applicable law (including,
without limitation, United States federal securities laws), Transamerica
Corporation or any of its sub-sidiaries, including the Partnership, may at any
time and from time to time purchase outstanding Series___Preferred Securities
by tender, in the open market or by private agreement. If the Partnership
purchases and cancels any Series___Preferred Securities, the Series___Junior
Subordinated Debentures may be repaid in a principal amount equal to the
aggregate stated liquidation preference of the Series___Preferred Securities so
purchased, together with any accrued and unpaid interest on such principal
amount of Series___Junior Subordinated Debentures.
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<PAGE> 14
6. Voting Rights. (a) Except as provided under
paragraph 6(b) below and as otherwise required by law and the Partnership
Agreement, the Holders of the Series___Preferred Securities will have no voting
rights.
(b) If (i) arrearages on Dividends on the Series___Preferred
Securities shall exist for 18 consecutive monthly Dividend periods; (ii) an
Event of Default (as defined in the Indenture) occurs and is continuing on the
Series___Junior Subordinated Debentures; or (iii) Transamerica Corporation is
in default on any of its payment obligations under the Guarantee, then the
Holders of the Series___Preferred Securities, together with the Holders of any
other series of Preferred Securities having the right to vote for the
appointment of a special representative of the Partnership and the Limited
Partners (a "Special Representative") in such event, acting as a single class,
will be entitled by the vote of a majority in aggregate liquidation preference
of such Holders to appoint and authorize a Special Representative to enforce
the Partnership's creditor rights under the Series___Junior Subordinated
Debentures, to enforce the rights of the Holders of the Series___Preferred
Securities under the Guarantee and to enforce the rights of the Holders of the
Series___Preferred Securities to receive Dividends (if and to the extent
declared) on the Series___Preferred Securities. The Special Representative
shall not, by virtue of acting in such capacity, be admitted as a general
partner in the Partnership or otherwise be deemed to be a general partner in
the Partnership and shall have no liability for the debts, obligations or
liabilities of the Partnership. Not later than 30 days after such right to
appoint a Special Representative arises, the General Partner will convene a
meeting for the purpose of appointing a Special Representative. If the General
Partner fails to convene such meeting within such 30-day period, the Holders of
10% in liquidation preference of the outstanding Preferred Securities will be
entitled to convene such meeting. The provisions of the Partnership Agreement
relating to the convening and conduct of the meetings of the partners will
apply with respect to any such meeting. In the event that, at any such
meeting, Holders of less than a majority in aggregate liquidation preference of
Preferred Securities entitled to vote for the appointment of a Special
Representative vote for such appointment, no Special Representative shall be
appointed. Any Special Representative appointed shall cease to be a special
representative of the Partnership and the Limited Partners if the Partnership
(or Transamerica Corporation pursuant to the Guarantee) shall have paid in full
all accrued and unpaid Dividends on the Preferred Securities or such default or
breach, as the case may be, shall have been cured, and
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<PAGE> 15
Transamerica Corporation, in its capacity as the General Partner, shall
continue the business of the Partnership without dissolution. Notwithstanding
the appointment of any such Special Representative, Transamerica Corporation
shall continue as General Partner and shall retain all rights under the
Indenture, including the right to extend the interest payment period, and any
such extension would not constitute a default under the Indenture or enable a
Holder of Series___Preferred Securities to require the payment of a Dividend
that has not theretofore been declared.
In furtherance of the foregoing, and without limiting the
powers of any Special Representative so appointed and for the avoidance of any
doubt concerning the powers of the Special Representative, any Special
Representative, in its own name, in the name of the Partnership, in the name of
the Limited Partners, or otherwise, may institute or cause to be instituted a
proceeding, including, without limitation, any suit in equity, an action at law
or other judicial or administrative proceeding, to enforce the Partnership's
rights directly against Transamerica Corporation or any other obligor in
connection with such obligations to the same extent as the Partnership and on
behalf of the Partnership, and may prosecute such proceeding to judgment or
final decree, and enforce the same against Transamerica Corporation, or any
other obligor in connection with such obligations.
If any proposed amendment to the Partnership Agreement
provides for, or the General Partner otherwise proposes to effect, (i) any
action that would adversely affect the powers, preferences or special rights of
the Series___Preferred Securities, whether by way of amendment to the
Partnership Agreement or otherwise (including, without limitation, the
authorization or issuance of any limited partner interests in the Partnership
ranking, as to participation in the profits or Dividends or in the assets of
the Partnership, senior to the Series___Preferred Securities), or (ii) the
dissolution, winding-up or termination of the Partnership, other than (x) in
connection with the distribution of Series___Junior Subordinated Debentures
upon the occurrence of a Special Event or (y) as described in paragraph 8
below, then the Holders of outstanding Series___Preferred Securities will be
entitled to vote on such amendment or proposal of the General Partner (but not
on any other amendment or proposal) as a class with all other Holders of series
of Preferred Securities similarly affected, and such amendment or proposal
shall not be effective except with the approval of the Holders of 66-2/3% in
liquidation preference of such outstanding Preferred Securities having a right
to vote on the matter; provided, however, that no such approval shall be
required if the dissolution, winding-up or termination of the Partnership
-15-
<PAGE> 16
is proposed or initiated upon the initiation of proceedings, or after
proceedings have been initiated, for the dissolution, winding-up, liquidation
or termination of Transamerica Corporation.
The rights attached to the Series___Preferred Securities will
be deemed not to be adversely affected by the creation or issue of, and no vote
will be required for the creation or issue of, any further limited partner
interests of the Partnership ranking pari passu with the Series___Preferred
Securities with regard to participation in the profits or Dividends or in the
assets of the Partnership. Holders of Series___Preferred Securities have no
preemptive rights.
So long as any Series___Junior Subordinated Debentures are
held by the Partnership, the General Partner shall not (i) direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or executing any trust or power conferred on the Trustee with respect
to such series, (ii) waive any past default that is waivable under Section 6.06
of the Indenture, (iii) exercise any right to rescind or annul a declaration
that the principal of all the Series___Junior Subordinated Debentures shall be
due and payable or (iv) consent to any amendment, modification or termination
of the Indenture or the Series___Junior Subordinated Debentures, where such
consent shall be required, without, in each case, obtaining the prior approval
of the Holders of at least 66-2/3% in liquidation preference of all series of
Preferred Securities who would be affected thereby if their Preferred
Securities were to be exchanged for Junior Subordinated Debentures, acting as a
single class; provided, however, that where a consent under the Indenture would
require the consent of each Holder affected thereby, no such consent shall be
given by the General Partner without the prior consent of each Holder of all
series of Preferred Securities who would be affected thereby if its Preferred
Securities were to be exchanged for Junior Subordinated Debentures. The
General Partner shall not revoke any action previously authorized or approved
by a vote of the Holders of any series of Preferred Securities who would be
affected thereby if their Preferred Securities were to be exchanged for Junior
Subordinated Debentures. The General Partner shall notify all Holders of the
Series___Preferred Securities of any notice of default received from the
Trustee under the Indenture with respect to the Series___Junior Subordinated
Debentures.
Any required approval of Holders of Series___Preferred
Securities may be given at a separate meeting of Holders of Preferred
Securities convened for such purpose, at a meeting
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<PAGE> 17
of all of the Partners in the Partnership or pursuant to written consent. The
Partnership will cause a notice of any meeting at which Holders of
Series___Preferred Securities are entitled to vote, or of any matter upon which
action by written consent of such Holders is to be taken, to be mailed to each
Holder of record of Series___Preferred Securities. Each such notice will
include a statement setting forth (i) the date of such meeting or the date by
which such action is to be taken, (ii) a description of any resolution proposed
for adoption at such meeting on which such Holders are entitled to vote or of
such matter upon which written consent is sought and (iii) instructions for the
delivery of proxies or consents.
No vote or consent of the Holders of Series___Preferred
Securities will be required for the Partnership to redeem and cancel
Series___Preferred Securities in accordance with the Partnership Agreement.
Notwithstanding that Holders of Series___Preferred Securities
are entitled to vote or consent under any of the circumstances described above,
any of the Series___Preferred Securities and any other series of Preferred
Securities that are entitled to vote or consent with such Series___Preferred
Securities as a single class at such time that are owned by Transamerica
Corporation or by any entity more than 50% of which is owned by Transamerica
Corporation, either directly or indirectly, shall not be entitled to vote or
consent and shall, for purposes of such vote or consent, be treated as if they
were not outstanding.
Holders of the Series___Preferred Securities will have no
rights to remove or replace the General Partner.
7. Ranking. So long as any Series___Preferred Securities are
outstanding, the Partnership will not issue any partnership interests ranking,
as to participation in the profits or Dividends or in the assets of the
Partnership, senior to the Series___Preferred Securities.
8. Mergers, Consolidations or Amalgamations. The Partnership
may not consolidate, amalgamate, merge with or into, or be replaced by, or
convey, transfer or lease its properties and assets substantially as an
entirety to, any corporation or other body, except as described below. The
Partnership may, without the consent of the Holders of the Series___Preferred
Securities, consolidate, amalgamate, merge with or into, or be replaced by a
limited partnership, limited liability company or trust organized as such under
the laws of any state of the United States of America provided that (i) such
successor entity either (x) expressly assumes all of the obligations of
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<PAGE> 18
the Partnership under the Series___Preferred Securities or (y) substitutes for
the Series___Preferred Securities other securities having substantially the
same terms as the Series___Preferred Securities (the "Successor Securities") so
long as the Successor Securities rank, with respect to participation in the
profits and Dividends, and in the assets, of the successor entity, at least as
high as the Series___Preferred Securities rank with respect to participation in
the profits and Dividends, and in the assets, of the Partnership, (ii)
Transamerica Corporation expressly acknowledges such successor entity as the
Holder of the Series___Junior Subordinated Debentures, (iii) the Series___
Preferred Securities or any Successor Securities are listed, or any Successor
Securities will be listed upon notification of issuance, on any national
securities exchange or other organization on which the Series___Preferred
Securities are then listed, (iv) such merger, consolidation, amalgamation or
replacement does not cause the Series___Preferred Securities (including any
Successor Securities) to be downgraded by any nationally recognized statistical
rating organization, (v) such merger, consolidation, amalgamation or
replacement does not adversely affect the powers, preferences and other special
rights of the Holders of the Series___Preferred Securities (including any
Successor Securities) in any material respect (other than with respect to any
dilution of the Holders' interest in the new entity), (vi) such successor
entity has a purpose substantially identical to that of the Partnership, (vii)
prior to such merger, consolidation, amalgamation or replacement, Transamerica
Corporation has received an opinion of nationally recognized independent
counsel to the Partnership experienced in such matters to the effect that (x)
such successor entity will be treated as a partnership for federal income tax
purposes, (y) following such merger, consolidation, amalgamation or
replacement, Transamerica Corporation and such successor entity will be in
compliance with the 1940 Act without registering thereunder as an investment
company, and (z) such merger, consolidation, amalgamation or replacement will
not adversely affect the limited liability of the Holders of the Series___
Preferred Securities and (viii) Transamerica Corporation guarantees the
obligations of such successor entity under the Successor Securities at least to
the extent provided by the Guarantee.
This written Action shall constitute an Action for purposes of
the Partnership Agreement and shall be deemed for all purposes to be a part of
the Partnership Agreement.
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<PAGE> 19
IN WITNESS WHEREOF, the undersigned has executed this Action
of General Partner this __ day of October, 1994.
TRANSAMERICA CORPORATION,
GENERAL PARTNER
By:_________________________
Name:
Title:
<PAGE> 1
Exhibit 5.1
(Letterhead of Transamerica Corporation)
October 7, 1994
Transamerica Corporation
600 Montgomery Street
San Francisco, California 94111
Gentlemen:
I am Senior Vice President and General Counsel of Transamerica
Corporation, a Delaware corporation (the "Corporation"). As counsel to the
Corporation and Transamerica Delaware, L.P., a Delaware limited partnership
("Transamerica Delaware"), I have examined the Registration Statement filed on
August 11, 1994 and amended by Amendment No. 1 filed on September 21, 1994 and
Amendment No. 2 filed on October 7, 1994 (File No. 33-55047/33-55074-01) (as
amended, the "Registration Statement") of the Corporation and Transamerica
Delaware on Form S-3 for the registration under the Securities Act of 1933, as
amended (the "Act"), of up to (i) $425,000,000 aggregate liquidation preference
of preferred securities (the "Preferred Securities") of Transamerica Delaware,
(ii) $425,000,000 aggregate principal amount of junior subordinated debentures
of the Corporation (the "Debt Securities") to be issued to Transamerica
Delaware in connection with the offering of the Preferred Securities and (iii)
a guarantee of the Corporation with respect to the Preferred Securities (the
"Guarantee"). I have also examined the Corporation's Certificate of
Incorporation, as amended, and its By-Laws, as amended, and such corporate
records and other documents as I have deemed necessary to enable me to express
the opinions with respect to the Debt Securities and the Guarantee set forth
below.
In my opinion,
1. When (i) the Registration Statement shall have become
effective under the Act and (ii) the Indenture (the "Indenture"),
between the Corporation and The First National Bank of Chicago, as
Trustee (the "Trustee"), substantially in the form of Exhibit 4.1 to
the Registration
<PAGE> 2
Statement and any supplements and amendments thereto, shall have been
qualified under the Trust Indenture Act of 1939, as amended, and duly
executed and delivered by the Corporation and the Trustee, the Debt
Securities, upon their issuance and sale in the manner contemplated in
the Registration Statement and the Indenture, will be legally and
validly issued, and will constitute legal, valid and binding
obligations of the Corporation, subject to bankruptcy, insolvency,
reorganization, moratorium, or similar laws or equitable principles
relating to or limiting creditors' rights generally.
2. When (i) the Registration Statement shall have become
effective under the Act, (ii) the Guarantee, substantially in the form
of Exhibit 4.9 to the Registration Statement, shall have been duly
executed and delivered by the Corporation and (iii) Preferred
Securities have been duly issued and sold and the purchase price
therefor received by Transamerica Delaware, the Guarantee will be
legally and validly issued and will constitute a legal, valid and
binding obligation of the Corporation, subject to bankruptcy,
insolvency, reorganization, moratorium, or similar laws or equitable
principles relating to or limiting creditors' rights generally.
I hereby consent to the reference made to me under the caption "Legal Opinions"
in the preliminary Prospectus and under the caption "Legal Matters" in the form
of preliminary Prospectus Supplement pertaining to the Preferred Securities,
the Debt Securities and the Guarantee, each forming a part of the Registration
Statement, and to the filing of this consent as an exhibit to the Registration
Statement.
Very truly yours,
/S/ CHRISTOPHER M. McLAIN
Christopher M. McLain
Senior Vice President and General Counsel
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<PAGE> 1
Exhibit 5.2
(Letterhead of Richards, Layton & Finger)
October 10, 1994
Transamerica Delaware, L.P.
c/o Transamerica Corporation
600 Montgomery Street
San Francisco, California 94111
Re: Transamerica Delaware, L.P.
Ladies and Gentlemen:
We have acted as special Delaware counsel for Transamerica
Corporation, a Delaware corporation ("Transamerica"), and Transamerica
Delaware, L.P., a Delaware limited partnership (the "Partnership"), in
connection with the matters set forth herein. At your request, this opinion is
being furnished to you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of executed or
conformed counterparts, or copies otherwise proved to our satisfaction, of the
following:
(a) The Certificate of Limited Partnership of the
Partnership, dated as of August 9, 1994 (the "Certificate"), as filed in the
office of the Secretary of State of the State of Delaware (the "Secretary of
State") on August 9, 1994;
(b) The Agreement of Limited Partnership of the
Partnership, dated as of August 9, 1994;
<PAGE> 2
Transamerica Delaware, L.P.
October 10, 1994
Page 2
(c) Amendment No. 2 to the registration statement (the
"Registration Statement") on Form S-3, including a preliminary prospectus (the
"Prospectus") and two preliminary prospectus supplements (the "Prospectus
Supplements"), relating to the Preferred Securities, as filed by Transamerica
and the Partnership with the Securities and Exchange Commission on or about
October 10, 1994;
(d) A form of Amended and Restated Agreement of Limited
Partnership of the Partnership, attached as an exhibit to the Registration
Statement (the "Agreement");
(e) Two forms of Action of Transamerica, as general
partner of the Partnership, relating to the Preferred Securities, each attached
as an exhibit to the Registration Statement; and
(f) A Certificate of Good Standing for the Partnership,
dated October 7, 1994, obtained from the Secretary of State.
The Agreement as amended and supplemented by a written action
of Transamerica, providing for the issue of Preferred Securities, in one of the
forms attached as an exhibit to the Registration Statement ("the Action"), is
hereinafter referred to as the "LP Agreement." Initially capitalized terms used
herein and not otherwise defined are used as defined in the LP Agreement.
For purposes of this opinion, we have not reviewed any
documents other than the documents listed in paragraphs (a) through (f) above.
In particular, we have not reviewed any document (other than the documents
listed in paragraphs (a) through (f) above) that is referred to in or
incorporated by reference into the LP Agreement or the Registration Statement.
We have assumed that there exists no provision in any document that we have not
reviewed that is inconsistent with the opinions stated herein. We have
conducted no independent factual investigation of our own but rather have
relied solely upon the foregoing documents, the statements and information set
forth therein and the additional matters recited or assumed herein, all of
which we have assumed to be true, complete and accurate in all material
respects.
With respect to all documents examined by us, we have assumed
(i) the authenticity of all documents submitted to us as authentic originals,
(ii) the conformity with the originals of all documents submitted to us as
copies or forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the LP
Agreement constitutes the entire agreement among the parties thereto with
respect to the subject matter thereof, including with respect to the admission
of partners to, and the
<PAGE> 3
Transamerica Delaware, L.P.
October 10, 1994
Page 3
creation, operation and termination of, the Partnership, and that the LP
Agreement and the Certificate are in full force and effect and have not been
amended, (ii) except to the extent provided in paragraph 1 below, the due
organization or due formation, as the case may be, and valid existence in good
standing of each party to the documents examined by us under the laws of the
jurisdiction governing its organization or formation, (iii) the legal capacity
of natural persons who are parties to the documents examined by us, (iv) that
each of the parties to the documents examined by us has the power and authority
to execute and deliver, and to perform its obligations under, such documents,
(v) the due authorization, execution and delivery by all parties thereto of all
documents examined by us, including the Agreement and the Action, (vi) the
receipt by each Person to be admitted to the Partnership as a limited partner
of the Partnership in connection with its purchase of Preferred Securities
(each, a "Preferred Security Holder" and collectively, the "Preferred Security
Holders") of an LP Certificate and the payment for the Preferred Securities
acquired by it, in accordance with the LP Agreement, (vii) that the books and
records of the Partnership set forth all information required by the LP
Agreement and the Delaware Revised Uniform Limited Partnership Act (6 Del. C.
Section 17-101, et seq.) (the "Act"), including all information with respect
to all Persons to be admitted as Partners and their contributions to the
Partnership, and (viii) that the Preferred Securities are issued and sold to
the Preferred Security Holders in accordance with the Registration Statement
and the LP Agreement. We have not participated in the preparation of the
Registration Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our
opinions are rendered only with respect to Delaware laws and rules, regulations
and orders thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such
questions of law and statutes of the State of Delaware as we have considered
necessary or appropriate, and subject to the assumptions, qualifications,
limitations and exceptions set forth herein, we are of the opinion that:
1. The Partnership has been duly formed and is validly
existing in good standing as a limited partnership under the laws of the State
of Delaware.
<PAGE> 4
Transamerica Delaware, L.P.
October 10, 1994
Page 4
2. Assuming that the Preferred Security Holders, as
limited partners of the Partnership, do not participate in the control of the
business of the Partnership, upon issuance and payment as contemplated by the
LP Agreement, the Preferred Securities will represent valid and, subject to the
qualifications set forth herein, will be fully paid and nonassessable limited
partner interests in the Partnership, as to which the Preferred Security
Holders, as limited partners of the Partnership, will have no liability in
excess of their obligations to make payments provided for in the LP Agreement
and their share of the Partnership's assets and undistributed profits (subject
to the obligation of a Preferred Security Holder to repay any funds wrongfully
distributed to it).
3. There are no provisions in the LP Agreement the
inclusion of which, subject to the terms and conditions therein, or, assuming
that the Preferred Security Holders, as limited partners of the Partnership,
take no action other than actions permitted by the LP Agreement, the exercise
of which, in accordance with the terms and conditions therein, would cause the
Preferred Security Holders, as limited partners of the Partnership, to be
deemed to be participating in the control of the business of the Partnership.
We consent to the filing of this opinion with the Securities
and Exchange Commission as an exhibit to the Registration Statement. We hereby
consent to the use of our name under the heading "Legal Matters" in the
Prospectus Supplements and "Legal Opinions" in the Prospectus. We hereby
consent to the reliance by counsel for the Partnership and Transamerica upon
this opinion as to matters of Delaware law for purposes of his opinion being
rendered in connection with the Registration Statement. In giving the
foregoing consents, we do not thereby admit that we come within the category of
persons whose consent is required under Section 7 of the Securities Act of
1933, as amended, or the rules and regulations of the Securities and Exchange
Commission thereunder. Except as stated above, without our prior written
consent, this opinion may not be furnished or quoted to, or relied upon by, any
other person or entity for any purpose.
Very truly yours,
/s/ Richards, Layton & Finger
PMA/WAY/lds
<PAGE> 1
Exhibit 8.1
(Letterhead of
WACHTELL LIPTON ROSEN & KATZ
51 West 52nd Street
New York, New York 10019)
October 7, 1994
Transamerica Corporation
600 Montgomery Street
San Francisco, California 94111
Dear Sirs:
We have acted as your counsel in connection with the
registration by Transamerica Delaware, L.P. of Monthly Income Preferred
Securities and hereby confirm to you our opinion as set forth in the section
entitled "United States Taxation" of the form of preliminary Prospectus
Supplement forming part of the Registration Statement referred to below.
We hereby consent to the filing of this opinion with the
Securities and Exchange Commission (the "Commission") as an exhibit to the
Registration Statement on Form S-3, as amended, filed by Transamerica
Corporation and Transamerica Delaware, L.P. with the Commission on the date
hereof (File No. 33-55047/33-55047-01), and to the use of our name under the
headings "Legal Matters" and "United States Taxation" in the form of
preliminary Prospectus Supplement and under the heading "Legal Opinions" in the
preliminary Prospectus, each forming a part of such Registration Statement.
In giving the foregoing consent, we do not thereby admit that we come within
the category of persons whose consent is required under Section 7 of the
Securities Act of 1933, as amended, or the rules and regulations of the
Commission thereunder.
Very truly yours,
/s/ WACHTELL, LIPTON, ROSEN & KATZ
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement and related Prospectuses for the Transamerica Delaware,
L.P. Monthly Income Preferred Securities and to the incorporation by reference
therein of our report dated February 22, 1994, with respect to the consolidated
financial statements and schedules of Transamerica Corporation included or
incorporated by reference in its Annual Report (Form 10-K) for the year ended
December 31, 1993, filed with the Securities and Exchange Commission.
ERNST & YOUNG LLP
San Francisco, California
October 5, 1994
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "EXPERTS", and
the incorporation by reference in this registration statement of our reports
dated 22 February 1994, 23 February 1993 and 25 February 1992 from the
Transamerica Corporation Annual Report on Form 10-K for the years ended December
31, 1993, 1992 and 1991 on the consolidated financial statements of Sedgwick
Group plc.
Coopers & Lybrand
Plumtree Court
London EC4A 4HT
6 October 1994
