<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 14, 1994
REGISTRATION NOS. 33-55047
33-55047-01
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 3
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 14, 1994
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED OCTOBER , 1994
6,000,000 PREFERRED SECURITIES
TRANSAMERICA DELAWARE
% CUMULATIVE MONTHLY INCOME PREFERRED SECURITIES,
[LOGO] SERIES A ("MIPS"*)
(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 $1,120,000.
---------------------
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.
SMITH BARNEY INC.
DEAN WITTER REYNOLDS INC.
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
MORGAN STANLEY & CO.
INCORPORATED
PAINEWEBBER INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
SALOMON BROTHERS INC
---------------------
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.
------------------------
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-2
<PAGE> 5
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-3
<PAGE> 6
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-4
<PAGE> 7
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-5
<PAGE> 8
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-6
<PAGE> 9
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
--------- -----------
<S> <C> <C>
(IN MILLIONS)
Short-term obligations, including current maturities............... $ 1,647.0 $ 1,647.0
Long-term debt (1)................................................. 7,111.3 7,111.3
Life insurance policy liabilities.................................. 23,410.3 23,410.3
Other liabilities.................................................. 3,681.9 3,681.9
Minority interest in equity of subsidiaries........................ 150.0
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....................................... 200.0 200.0(2)
Dutch Auction Rate Transferable Securities
Preferred Stock ("DARTS"), Series A-1
750 shares issued........................................... 75.0 75.0
DARTS, Series B-1
750 shares issued........................................... 75.0 75.0
DARTS, Series C-1
750 shares issued........................................... 75.0 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 70.4
Additional paid-in capital....................................... 152.1 152.1
Retained earnings................................................ 2,421.8 2,421.8
Net unrealized gain from investments marked to fair value........ 72.7 72.7
Foreign currency translation adjustments......................... (35.9) (35.9)
--------- -----------
Total shareholders' equity............................... 3,106.1 3,106.1
--------- -----------
Total capitalization (excluding life insurance policy
liabilities, other liabilities and short-term
obligations)........................................... $10,217.4 $10,367.4
========= ==========
</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.
(2) On October 14, 1994, Transamerica commenced a tender offer to purchase
depositary shares representing up to 320,000 shares of its 8.50% Preferred
Stock, Series D ("Series D Preferred Stock"), on the terms and subject to
the conditions set forth in Transamerica's Offer to Purchase dated October
14, 1994 and the related Letter of Transmittal. The purchase of such
depositary shares pursuant to the offer will reduce the aggregate
liquidation preference of Series D Preferred Stock which is outstanding. If
depositary shares representing the maximum of 320,000 shares of Series D
Preferred Stock are purchased in such offer, $40 million aggregate
liquidation preference of Series D Preferred Stock would remain outstanding
following the offer.
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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. Under the
Limited Partnership Agreement, if and to the extent Transamerica does make
interest payments on the Series A Junior Subordinated Debentures, Transamerica
Delaware is
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obligated, to the extent funds are legally available therefor, to declare
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 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
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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 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
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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 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 first 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
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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 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
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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 are
not junior to any other equity securities of the successor entity, with respect
to participation in the profits and dividends, and in the assets, of the
successor entity, (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
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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 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.
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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 who would be so 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
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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 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
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<PAGE> 20
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.
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. Under the Limited Partnership Agreement, if and
to the extent Transamerica does make interest payments on the Series A Junior
Subordinated Debentures, Transamerica Delaware is obligated, to the extent funds
are legally available therefor, to declare 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
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<PAGE> 26
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.
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
S-25
<PAGE> 28
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., Smith Barney
Inc., Dean Witter Reynolds Inc., Donaldson, Lufkin & Jenrette Securities
Corporation, Morgan Stanley & Co. Incorporated, PaineWebber Incorporated,
Prudential Securities Incorporated and Salomon Brothers Inc 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..............................................
Smith Barney Inc. ...............................................
Dean Witter Reynolds Inc. .......................................
Donaldson, Lufkin & Jenrette Securities Corporation..............
Morgan Stanley & Co. Incorporated................................
PaineWebber Incorporated.........................................
Prudential Securities Incorporated...............................
Salomon Brothers Inc.............................................
---------
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
S-29
<PAGE> 32
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 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
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Transamerica Delaware.................... S-3
Transamerica Corporation................. S-3
Investment Considerations................ S-4
Summary Consolidated Financial Data...... S-6
Capitalization of Transamerica........... S-7
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>
- ----------------------------------------------------------
- ----------------------------------------------------------
- ----------------------------------------------------------
- ----------------------------------------------------------
6,000,000 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.
SMITH BARNEY INC.
DEAN WITTER REYNOLDS INC.
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
MORGAN STANLEY & CO.
INCORPORATED
PAINEWEBBER INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
SALOMON BROTHERS INC
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 14, 1994
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED OCTOBER , 1994
<TABLE>
<S> <C> <C>
6,000,000 PREFERRED SECURITIES
</TABLE>
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 $1,120,000.
---------------------
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.
SMITH BARNEY INC.
DEAN WITTER REYNOLDS INC.
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
MORGAN STANLEY & CO.
INCORPORATED
PAINEWEBBER INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
SALOMON BROTHERS INC
---------------------
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".
------------------------
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.
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-2
<PAGE> 36
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-3
<PAGE> 37
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-4
<PAGE> 38
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-5
<PAGE> 39
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-6
<PAGE> 40
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
--------- -----------
<S> <C> <C>
(IN MILLIONS)
Short-term obligations, including current maturities............... $ 1,647.0 $ 1,647.0
Long-term debt (1)................................................. 7,111.3 7,111.3
Life insurance policy liabilities.................................. 23,410.3 23,410.3
Other liabilities.................................................. 3,681.9 3,681.9
Minority interest in equity of subsidiaries........................ 150.0
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....................................... 200.0 200.0(2)
Dutch Auction Rate Transferable Securities
Preferred Stock ("DARTS"), Series A-1
750 shares issued........................................... 75.0 75.0
DARTS, Series B-1
750 shares issued........................................... 75.0 75.0
DARTS, Series C-1
750 shares issued........................................... 75.0 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 70.4
Additional paid-in capital....................................... 152.1 152.1
Retained earnings................................................ 2,421.8 2,421.8
Net unrealized gain from investments marked to fair value........ 72.7 72.7
Foreign currency translation adjustments......................... (35.9) (35.9)
--------- -----------
Total shareholders' equity............................... 3,106.1 3,106.1
--------- -----------
Total capitalization (excluding life insurance policy
liabilities, other liabilities and short-term
obligations)........................................... $10,217.4 $10,367.4
========= ==========
</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.
(2) On October 14, 1994, Transamerica commenced a tender offer to purchase
depositary shares representing up to 320,000 shares of its 8.50% Preferred
Stock, Series D ("Series D Preferred Stock"), on the terms and subject to
the conditions set forth in Transamerica's Offer to Purchase dated October
14, 1994 and the related Letter of Transmittal. The purchase of such
depositary shares pursuant to the offer will reduce the aggregate
liquidation preference of Series D Preferred Stock which is outstanding. If
depositary shares representing the maximum of 320,000 shares of Series D
Preferred Stock are purchased in such offer, $40 million aggregate
liquidation preference of Series D Preferred Stock would remain outstanding
following the offer.
S-7
<PAGE> 41
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-8
<PAGE> 42
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". Under the Limited Partnership Agreement, 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. Under the Limited Partnership Agreement, if and
to
S-9
<PAGE> 43
the extent Transamerica does make interest payments on the Series A Junior
Subordinated Debentures, Transamerica Delaware is obligated, to the extent funds
are legally available therefor, to declare 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 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
S-10
<PAGE> 44
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 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
S-11
<PAGE> 45
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 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.
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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.
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
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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 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
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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, repurchased or otherwise, the proceeds from such
repayment will be applied first 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
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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.
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
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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 are
not junior to any other equity securities of the successor entity, with respect
to participation in the profits and dividends, and in the assets, of the
successor entity, (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
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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
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 who would be so affected thereby. The General Partner shall
not revoke any action
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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 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.
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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.
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.
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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.
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".
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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 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
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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 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
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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 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.
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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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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. Under the Limited Partnership Agreement, if and
to the extent Transamerica does make interest payments on the Series A Junior
Subordinated Debentures, Transamerica Delaware is obligated, to the extent funds
are legally available therefor, to declare 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
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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.
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
S-29
<PAGE> 63
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-30
<PAGE> 64
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-31
<PAGE> 65
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., Smith Barney
Inc., Dean Witter Reynolds Inc., Donaldson, Lufkin & Jenrette Securities
Corporation, Morgan Stanley & Co. Incorporated, PaineWebber Incorporated,
Prudential Securities Incorporated and Salomon Brothers Inc 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..............................................
Smith Barney Inc. ...............................................
Dean Witter Reynolds Inc. .......................................
Donaldson, Lufkin & Jenrette Securities Corporation..............
Morgan Stanley & Co. Incorporated................................
PaineWebber Incorporated.........................................
Prudential Securities Incorporated...............................
Salomon Brothers Inc.............................................
-----------
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
S-32
<PAGE> 66
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 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-33
<PAGE> 67
- ----------------------------------------------------------
- ----------------------------------------------------------
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
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Transamerica Delaware.................... S-3
Transamerica Corporation................. S-3
Investment Considerations................ S-4
Summary Consolidated Financial Data...... S-6
Capitalization of Transamerica........... S-7
Use of Proceeds.......................... S-8
Description of the Series A Preferred
Securities............................. S-9
Description of the Series A Junior
Subordinated Debentures................ S-21
Relationship between the Series A
Preferred Securities, the Series A
Junior Subordinated Debentures and the
Guarantee.............................. S-26
United States Taxation................... S-28
Underwriting............................. S-32
Legal Matters............................ S-33
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>
- ----------------------------------------------------------
- ----------------------------------------------------------
- ----------------------------------------------------------
- ----------------------------------------------------------
6,000,000 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.
SMITH BARNEY INC.
DEAN WITTER REYNOLDS INC.
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
MORGAN STANLEY & CO.
INCORPORATED
PAINEWEBBER INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
SALOMON BROTHERS INC
REPRESENTATIVES OF THE UNDERWRITERS
----------------------------------------------------------
----------------------------------------------------------
<PAGE> 68
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 14, 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> 69
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> 70
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> 71
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> 72
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.
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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.
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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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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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(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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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.
14
<PAGE> 82
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> 83
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> 84
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO. DOCUMENT
------ ---------------------------------------------------------------------------------
<S> <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.**
** Previously filed.
</TABLE>
II-3
<PAGE> 85
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> 86
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
14th 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
14th 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.
Principal executive officer:
Date: October 14, 1994 By /s/ FRANK C. HERRINGER
-----------------------------------------
(Frank C. Herringer)
President, Chief Executive Officer and
Director
Principal financial officer:
Date: October 14, 1994 By /s/ EDGAR H. GRUBB
-----------------------------------------
(Edgar H. Grubb)
Executive Vice President and Chief
Financial Officer
II-5
<PAGE> 87
Principal accounting officer:
Date: October 14, 1994 By /s/ BURTON E. BROOME
---------------------------------------------
(Burton E. Broome)
Vice President and Controller
Directors:
Date: October 14, 1994 By *
-----------------------------------------
(Myron DuBain)
Date: October 14, 1994 By *
-----------------------------------------
(Samuel L. Ginn)
Date: October 14, 1994 By *
-----------------------------------------
(James R. Harvey)
Chairman of the Board
Date: October 14, 1994 By *
-----------------------------------------
(Gordon E. Moore)
Date: October 14, 1994 By *
-----------------------------------------
(Raymond F. O'Brien)
Date: October 14, 1994 By *
-----------------------------------------
(Condoleeza Rice)
Date: October 14, 1994 By *
-----------------------------------------
(Charles R. Schwab)
Date: October 14, 1994 By *
-----------------------------------------
(Forrest R. Shumway)
Date: October 14, 1994 By *
-----------------------------------------
(Peter V. Ueberroth)
*By /s/ CHRISTOPHER M. MCLAIN
----------------------------------------
Christopher M. McLain
As attorney-in-fact
II-6
<PAGE> 88
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**....................................
** Previously filed
</TABLE>
<PAGE> 1
EXHIBIT 1.1
TRANSAMERICA DELAWARE, L.P.
CUMULATIVE MONTHLY
INCOME PREFERRED SECURITIES
GUARANTEED BY
TRANSAMERICA CORPORATION
___________________________________________
Underwriting Agreement
October __, 1994
Goldman, Sachs & Co.,
[Name(s) of Co-Representative(s),]
c/o Goldman, Sachs & Co.,
85 Broad Street,
New York, New York 10004
Ladies and Gentlemen:
From time to time Transamerica Delaware, L.P., a Delaware limited
partnership (the "Company"), and Transamerica Corporation, a Delaware
corporation, as general partner of the Company and as Guarantor under the
Guarantee hereinafter referred to (the "Guarantor"), propose to enter into one
or more Pricing Agreements (each, a "Pricing Agreement") in the form of Annex I
hereto, with such additions and deletions as the parties thereto may determine,
and, subject to the terms and conditions stated herein and therein, to issue
and sell, in the case of the Company, or to cause the Company to issue and
sell, in the case of the Guarantor, to the firms named in Schedule I to the
applicable Pricing Agreement (such firms constituting the "Underwriters" with
respect to such Pricing Agreement and the securities specified therein) certain
of the Company's preferred limited partner interests designated Cumulative
Monthly Income Preferred Securities (the "Preferred Securities"), which
Preferred Securities may be issued in one or more series, guaranteed by the
Guarantor pursuant to and to the extent set forth in a Guarantee Agreement
relating to each such series in substantially the form filed as an exhibit to
the registration statement described herein (the "Guarantee"), for the benefit
of the holders from time to time of the Preferred Securities (the Preferred
Securities and the Guarantee being referred to collectively as the
"Securities") specified in Schedule II to such Pricing Agreement (with respect
to such Pricing Agreement, the "Firm Securities"). If specified in such
Pricing Agreement, the Company may grant to the Underwriters the right to
purchase at their election an additional number of Preferred Securities,
specified in such Pricing Agreement, as provided in Section 3 hereof (with
respect to such Pricing Agreement, the "Optional Securities"). The Firm
Securities and the Optional Securities, if any, which the Underwriters elect to
purchase pursuant to Section 3 hereof are herein collectively called the
"Designated Securities" with respect to any Pricing Agreement.
The terms and rights of any particular issuance of Designated
Securities shall be as specified in the Pricing Agreement relating thereto.
The Company will loan the proceeds of any offering of
<PAGE> 2
Draft of October 13, 1994
the Designated Securities and any capital contributions made to the Company to
the Guarantor, each such loan to be evidenced by a series of junior
subordinated debentures (with respect to any Pricing Agreement, the
"Debentures") to be issued by the Guarantor pursuant to the junior subordinated
indenture, as it may be amended and supplemented from time to time (as so
amended or supplemented, the "Indenture") identified in Schedule II to the
Pricing Agreement.
1. Sales of Designated Securities may be made from time to time
to the Underwriters of such Securities, for whom the firms designated as
representatives of the Underwriters of such Securities in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" also refers to a single firm acting as sole representative of
the Underwriters and to Underwriters who act without any firm being designated
as their representative. This Underwriting Agreement shall not be construed as
an obligation of the Company to sell any of the Securities or as an obligation
of any of the Underwriters to purchase any of the Securities. The obligation
of the Company to issue and sell any of the Securities and the obligation of
any of the Underwriters to purchase any of the Securities shall be evidenced by
the Pricing Agreement with respect to the Designated Securities specified
therein. Each Pricing Agreement shall specify the aggregate number of Firm
Securities, the maximum number of Optional Securities, if any, the initial
public offering price of such Firm and Optional Securities, if any, or the
manner of determining such price, the terms of the Designated Securities, the
purchase price to the Underwriters of such Designated Securities, the names of
the Underwriters of such Designated Securities, the names of the
Representatives of such Underwriters, the number of such Designated Securities
to be purchased by each Underwriter and the commission, if any, payable to the
Underwriters with respect thereto and shall set forth the date, time and manner
of delivery of such Firm and Optional Securities, if any, and payment therefor.
The Pricing Agreement shall also specify (to the extent not set forth in the
registration statement and prospectus with respect thereto) the terms of such
Designated Securities. A Pricing Agreement shall be in the form of an executed
writing (which may be in counterparts), and may be evidenced by an exchange of
telegraphic communications or any other rapid transmission device designed to
produce a written record of communications transmitted. The obligations of the
Underwriters under this Agreement and each Pricing Agreement shall be several
and not joint.
2. Each of the Company and the Guarantor, jointly and severally,
represents and warrants to, and agrees with, each of the Underwriters that:
(a) A registration statement on Form S-3 (File Nos.
33-55047 and 33-55047-01) in respect of the Securities has been filed
with the Securities and Exchange Commission (the "Commission"); such
registration statement and any post-effective amendment thereto, each
in the form heretofore delivered or to be delivered to the
Representatives and, excluding exhibits to such registration
statement, but including all documents incorporated by reference in
the prospectus included therein, to the Representatives for delivery
to each of the other Underwriters, have been declared effective by the
Commission in such form; no other document with respect to such
registration statement or document incorporated by reference therein
has heretofore been filed, or transmitted for filing, with the
Commission (other than prospectuses filed pursuant to Rule 424(b) of
the rules and regulations of the
2
<PAGE> 3
Draft of October 13, 1994
Commission under the Securities Act of 1933, as amended (the "Act"),
each in the form heretofore delivered to the Representatives); and no
stop order suspending the effectiveness of such registration statement
has been issued and no proceeding for that purpose has been initiated
or, to the knowledge of the Company or the Guarantor, threatened by
the Commission; any preliminary prospectus included in such
registration statement, or filed with the Commission pursuant to Rule
424(a) under the Act, is hereinafter called a "Preliminary
Prospectus"; the various parts of such registration statement,
including all exhibits thereto and the documents incorporated by
reference in the prospectus contained in the registration statement at
the time such part of the registration statement became effective, but
excluding any Forms T-1, each as amended at the time such part of the
registration statement became effective, are hereinafter collectively
called the "Registration Statement"; the prospectus (including, if
applicable, any prospectus supplement) relating to the Securities, in
the form in which it has most recently been filed, or transmitted for
filing, with the Commission on or prior to the date of this Agreement,
is hereinafter called the "Prospectus"; any reference herein to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include the documents incorporated by reference therein pursuant
to the applicable form under the Act, as of the date of such
Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment or supplement to any Preliminary Prospectus
or the Prospectus shall be deemed to refer to and include any
documents filed after the date of such Preliminary Prospectus or
Prospectus, as the case may be, under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and incorporated by reference
in such Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment to the Registration Statement shall be
deemed to refer to and include any annual, quarterly or material
change report of the Company or the Guarantor filed pursuant to
Section 13(a) or 15(d) of the Exchange Act after the effective date of
the Registration Statement that is incorporated by reference in the
Registration Statement; and any reference to the Prospectus as amended
or supplemented shall be deemed to refer to the Prospectus as amended
or supplemented in relation to the applicable Designated Securities in
the form in which it is filed with the Commission pursuant to Rule
424(b) under the Act in accordance with Section 5(a) hereof, including
any documents incorporated by reference therein as of the date of such
filing;
(b) The documents incorporated by reference in the
Prospectus, when they became effective or were filed with the
Commission, as the case may be, conformed in all material respects to
the requirements of the Act or the Exchange Act, as applicable, and
the rules and regulations of the Commission thereunder, and none of
such documents contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; and any
further documents so filed and incorporated by reference in the
Prospectus or any further amendment or supplement thereto, when such
documents become effective or are filed with the Commission, as the
case may be, will conform in all material respects to the requirements
of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the
3
<PAGE> 4
Draft of October 13, 1994
statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter of Designated
Securities through the Representatives expressly for use in the
Prospectus as amended or supplemented relating to such Securities;
(c) The Registration Statement and the Prospectus
conform, and any further amendments or supplements to the Registration
Statement or the Prospectus will conform, in all material respects, to
the requirements of the Act and the Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act") and the rules and regulations of
the Commission thereunder and do not and will not, as of the
applicable effective date as to the Registration Statement and any
amendment thereto and as of the applicable filing date as to the
Prospectus and any amendment or supplement thereto, contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company
by an Underwriter of Designated Securities through the Representatives
expressly for use in the Prospectus as amended or supplemented
relating to such Securities;
(d) The Company has no subsidiaries. Neither the
Company, the Guarantor nor any of the Guarantor's subsidiaries has
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any material
loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus; and, since the
respective dates as of which information is given in the Registration
Statement and the Prospectus, there has not been any change in the
partnership interests or long-term debt of the Company, or in the
capital stock or long-term debt of the Guarantor or any of the
Guarantor's subsidiaries or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position,
partnership interests or shareholders' equity, as applicable, or
results of operations of the Company, the Guarantor and the
Guarantor's subsidiaries, otherwise than as set forth or contemplated
in the Prospectus;
(e) The Company has been duly formed and is validly
existing as a limited partnership in good standing under the laws of
the State of Delaware, and has, under the Delaware Revised Uniform
Limited Partnership Act (the "Delaware Act") and the Amended and
Restated Agreement of Limited Partnership of the Company (the
"Partnership Agreement"), all necessary partnership power and
authority to own its properties and conduct its business as described
in the Prospectus;
4
<PAGE> 5
Draft of October 13, 1994
(f) The Guarantor has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
Delaware, with all necessary power and authority to own its properties
and conduct its business as described in the Prospectus;
(g) The Guarantor has an authorized capitalization as set
forth in the Prospectus; all of the issued partnership interests of
the Company have been duly and validly authorized and issued and are
owned directly or indirectly by the Guarantor, free and clear of all
liens, encumbrances, equities or claims; all of the issued shares of
capital stock of the Guarantor have been duly and validly authorized
and issued and are fully paid and nonassessable; and the Company is
not a party to or otherwise bound by any agreement other than those
described in the Prospectus;
(h) The Partnership Agreement, which is in substantially
the form filed as an exhibit to the Registration Statement, has been
duly authorized by the Guarantor and its wholly-owned subsidiary,
Transamerica LP Holdings Corp. ("LP Holdings"), and constitutes a
valid and legally binding agreement of the Guarantor and LP Holdings,
enforceable against the Guarantor and LP Holdings by the limited
partners of the Company that hold Preferred Securities (the "Preferred
Securityholders") in accordance with its terms, subject to bankruptcy,
insolvency, reorganization, moratorium and other laws of general
applicability relating to or affecting creditors' rights and to
general equity principles; and the Partnership Agreement conforms in
all material respects to the descriptions thereof in the Prospectus
with respect to the Designated Securities;
(i) The Guarantee has been duly authorized and, when
issued and delivered pursuant to this Agreement, will have been duly
executed, issued and delivered and will constitute a valid and legally
binding obligation of the Guarantor;
(j) The Debentures have been duly authorized by the
Guarantor and, assuming due authentication, execution and delivery
thereof by the trustee under the Indenture (the "Trustee"), at the
Time of Delivery (as defined in Section 4 hereof) for the Designated
Securities, the Debentures will have been duly issued, executed,
authenticated and delivered and will constitute valid and legally
binding obligations of the Guarantor entitled to the benefits provided
by the Indenture and enforceable in accordance with their terms,
subject to bankruptcy, insolvency, reorganization, moratorium and
other laws of general applicability relating to or affecting
creditors' rights and to general equity principles; the Indenture,
which will be substantially in the form filed as an exhibit to the
Registration Statement, has been duly authorized by the Guarantor and,
assuming due authorization, execution and delivery thereof by the
Trustee, at the Time of Delivery for the Designated Securities the
Indenture will be duly qualified under the Trust Indenture Act and
will constitute a valid and legally
5
<PAGE> 6
Draft of October 13, 1994
binding instrument enforceable in accordance with its terms, subject
to bankruptcy, insolvency, reorganization, moratorium and other laws
of general applicability relating to or affecting creditors' rights
and to general equity principles; and the Indenture conforms, and the
Debentures will conform, in all material respects, to the descriptions
thereof contained in the Prospectus;
(k) The Securities have been duly and validly authorized,
and, subject to the qualifications set forth herein, when the Firm
Securities included within Designated Securities are issued and
delivered pursuant to this Agreement and the Pricing Agreement with
respect to such Designated Securities and, in the case of any Optional
Securities included within such Designated Securities, pursuant to
Over-allotment Options (as defined in Section 3 hereof) with respect
to such Designated Securities, the Preferred Securities will be duly
and validly issued, fully paid and nonassessable limited partner
interests in the Company as to which, assuming that the Preferred
Securityholders in their capacities as such, do not participate in the
control of the business of the Company, the Preferred Securityholders,
in their capacities as such, will have no liability, in excess of
their obligations to make payments provided for in the Partnership
Agreement and their share of the Company's assets and undistributed
profits (subject to the obligation of a Preferred Securityholder to
repay any funds wrongfully distributed to it); and the Securities
conform in all material respects to the description thereof contained
in the Registration Statement and the Designated Securities will
conform in all material respects to the description thereof contained
in the Prospectus;
(l) The issue and sale of the Securities and the
compliance by each of the Company and the Guarantor with all of the
provisions of this Agreement, any Pricing Agreement and each
Over-allotment Option, if any, and the execution, delivery and
performance by the Guarantor of its obligations under the Indenture,
the Debentures and the Guarantee, the performance by the Guarantor and
the Company of their respective obligations hereunder and thereunder,
and the consummation of the transactions contemplated herein and
therein will not conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which the Company or the Guarantor or any of its
subsidiaries is a party or by which the Company or the Guarantor or
any of its subsidiaries is bound or to which any of the property or
assets of the Company or the Guarantor or any of its subsidiaries is
subject, or result in any violation of any statute or any order, rule
or regulation of any court or governmental agency or body having
jurisdiction over the Company, the Guarantor or any of its
subsidiaries or any of their properties, in each case except for
conflicts, breaches, violations or defaults which would not,
individually or in the aggregate, have a material adverse effect on
the general affairs, consolidated financial position, partnership
interests or shareholders' equity, as applicable, or results of
operations of the Guarantor and its subsidiaries, taken as a whole,
and which will not interfere with the consummation of the
transactions contemplated herein or affect the validity of the
Securities purchased hereby, nor will such action result in any
violation of the provisions of the Partnership Agreement or the
Certificate
6
<PAGE> 7
Draft of October 13, 1994
of Incorporation or By-laws of the Guarantor; and no consent,
approval, authorization, order, registration or qualification of or
with any such court or governmental agency or body is required for the
issue and sale of the Securities or the consummation by the Company
and the Guarantor of the transactions contemplated by this Agreement,
any Pricing Agreement, the Indenture, the Debentures, the Guarantee or
any Over-allotment Option, except such as have been, or will have been
prior to each Time of Delivery, obtained under the Act and the Trust
Indenture Act, and such consents, approvals, authorizations,
registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Designated Securities by the Underwriters;
(m) Other than as set forth in the Prospectus, there are
no legal or governmental proceedings pending to which the Company, the
Guarantor or any of its subsidiaries is a party or of which any of
their properties is the subject, which, if determined adversely to the
Company, the Guarantor or any of its subsidiaries would individually
or in the aggregate have a material adverse effect on the consolidated
financial position, partnership interest or shareholders' equity, as
applicable, or results of operations of the Company or the Guarantor
and its subsidiaries taken as a whole; and, to the best of the
Company's and the Guarantor's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or threatened
by others;
(n) None of the Company, the Guarantor or LP Holdings is
in violation of the Partnership Agreement, none of the Guarantor or
any of its subsidiaries is in violation of its respective Certificate
of Incorporation or By-laws, and none of the Company, the Guarantor or
any of its subsidiaries is in default in the performance or observance
of any obligation, agreement, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement, lease or other
agreement or instrument to which it is a party or by which it or any
of its properties may be bound, in each case except for conflicts,
breaches, violations or defaults which would not, individually or in
the aggregate, have a material adverse effect on the general affairs,
consolidated financial position, partnership interests, or
shareholders' equity, as applicable, or results of operations of the
Guarantor and its subsidiaries, taken as a whole, and which will not
interfere with the consummation of the transactions contemplated
herein;
(o) The statements set forth in the Prospectus under
"Description of the Preferred Securities," "Description of the
Guarantee," "Description of the Junior Subordinated Debentures,"
"Description of the Series A Preferred Securities," "Description of
the Series A Junior Subordinated Debentures" and "Relationship between
the Series A Preferred Securities, the Series A Junior Subordinated
Debentures and the Guarantee," insofar as they purport to constitute a
summary of the terms of the Securities, and under "United States
Taxation," "Plan of Distribution" and "Underwriting," insofar as they
purport to describe the provisions of the laws and documents referred
to therein, are accurate and complete in all material respects;
7
<PAGE> 8
Draft of October 13, 1994
(p) Neither the Company nor the Guarantor is, and, after
giving effect to the offering and sale of the Securities, neither will
be, an "investment company" or an entity "controlled" by an
"investment company," as such terms are defined in the Investment
Company Act of 1940, as amended (the "Investment Company Act");
(q) Neither the Company nor any of its affiliates does
business with the government of Cuba or with any person or affiliate
located in Cuba within the meaning of Section 517.075, Florida
Statutes; and
(r) Ernst & Young LLP, who have certified certain
financial statements of the Guarantor and its subsidiaries, are
independent public accountants as required by the Act and the rules
and regulations of the Commission thereunder.
3. Upon the execution of the Pricing Agreement applicable to any
Designated Securities and authorization by the Representatives of the release
of the Firm Securities, the several Underwriters propose to offer the Firm
Securities for sale upon the terms and conditions set forth in the Prospectus
as amended or supplemented.
The Company may specify in the Pricing Agreement applicable to any
Designated Securities that the Company thereby grants to the Underwriters the
right (an "Over-allotment Option") to purchase at their election up to the
number of Optional Securities set forth in such Pricing Agreement, on the terms
referred to in the paragraph above, for the sole purpose of covering
over-allotments in the sale of the Firm Securities. Any such election to
purchase Optional Securities may be exercised by written notice from the
Representatives to the Company, given within a period specified in the Pricing
Agreement, setting forth the aggregate number of Optional Securities to be
purchased and the date on which such Optional Securities are to be delivered,
as determined by the Representatives but in no event earlier than the First
Time of Delivery (as defined in Section 4 hereof) or, unless the
Representatives and the Company otherwise agree in writing, earlier than or
later than the respective number of business days after the date of such notice
set forth in such Pricing Agreement.
The number of Optional Securities to be added to the number of Firm
Securities to be purchased by each Underwriter as set forth in Schedule I to
the Pricing Agreement applicable to such Designated Securities shall be, in
each case, the number of Optional Securities which the Company has been advised
by the Representatives has been attributed to such Underwriter; provided that,
if the Company has not been so advised, the number of Optional Securities to be
so added shall be, in each case, that proportion of the aggregate number of
Optional Securities which the number of Firm Securities to be purchased by such
Underwriter under such Pricing Agreement bears to the aggregate number of Firm
Securities (rounded as the Representatives may determine to the nearest
8
<PAGE> 9
Draft of October 13, 1994
100 shares). The total number of Designated Securities to be purchased by all
the Underwriters pursuant to such Pricing Agreement shall be the aggregate
number of Firm Securities set forth in Schedule I to such Pricing Agreement
plus the aggregate number of Optional Securities which the Underwriters elect
to purchase pursuant to the notice referred to in the foregoing paragraph.
4. Unless otherwise specified in the applicable Pricing
Agreement, global certificates for the Firm Securities and Optional Securities
to be purchased by each Underwriter pursuant to the applicable Pricing
Agreement, registered in the name "Cede & Co.," shall be delivered by or on
behalf of the Company to The Depository Trust Company for the account or
accounts of such Underwriter, against payment by such Underwriter or on its
behalf of the purchase price therefor by certified or official bank check or
checks, payable to the order of the Company, or by wire transfer to an account
designated by the Company, in the funds specified in such Pricing Agreement,
(i) with respect to the Firm Securities, all at the place and time and date
specified in such Pricing Agreement or at such other place and time and date as
the Representatives and the Company may agree upon in writing, such time and
date being herein called the "First Time of Delivery" and (ii) with respect to
the Optional Securities, if any, at the place, time and date specified by the
Representatives in the written notice given by the Representatives of the
Underwriters' election to purchase such Optional Securities, or at such other
place, time and date as the Representatives and the Company may agree upon in
writing, such time and date, if not the First Time of Delivery, herein called
the "Second Time of Delivery." Each such time and date for delivery is herein
called a "Time of Delivery."
As compensation to the Underwriters for their commitments to
purchase the Designated Securities, and in view of the fact that the proceeds
of the sale of the Securities will be loaned by the Company to the Guarantor,
the Guarantor hereby agrees to pay at each Time of Delivery to the
Representatives, for the accounts of the several Underwriters, an amount per
Security set forth in the Pricing Agreement relating to the Designated
Securities to be sold by the Company thereunder, provided, however, that such
compensation may, if so specified in the Pricing Agreement, be a reduced amount
per Security set forth in such Pricing Agreement with respect to Designated
Securities sold to certain institutions thereunder, in which case the
Underwriters shall inform the Company, in writing, the business day prior to
each Time of Delivery, of the number of Designated Securities sold to such
institutions.
5. Each of the Company and the Guarantor, jointly and severally,
agrees with each of the Underwriters of any Designated Securities:
(a) To prepare the Prospectus as amended and supplemented
in relation to the applicable Designated Securities in a form approved
by the Representatives and to file such Prospectus pursuant to Rule
424(b) under the Act not later than the Commission's close of business
on the second business day following the execution and delivery of the
Pricing
9
<PAGE> 10
Draft of October 13, 1994
Agreement relating to the applicable Designated Securities or, if
applicable, such earlier time as may be required by Rule 424(b) (or,
in the case of electronic filings within the time period permitted
pursuant to the rules promulgated by the Commission with respect to
electronic filings); to make no further amendment or any supplement to
the Registration Statement or Prospectus as amended or supplemented
after the date of the Pricing Agreement relating to such Securities
and prior to any Time of Delivery for such Securities which shall be
disapproved by the Representatives promptly after reasonable notice
thereof; to advise the Representatives promptly of any such amendment
or supplement after any Time of Delivery for such Securities and
furnish the Representatives with copies thereof; to file within the
time period required by the Exchange Act all reports and any
definitive proxy or information statements required to be filed by the
Company or the Guarantor with the Commission pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as the
delivery of a prospectus is required in connection with the offering
or sale of such Securities, and during such same period to advise the
Representatives, promptly after it receives notice thereof, of the
time when any amendment to the Registration Statement has been filed
or becomes effective or any supplement to the Prospectus or any
amended Prospectus has been filed with the Commission, of the issuance
by the Commission of any stop order or of any order preventing or
suspending the use of any prospectus relating to the Securities, of
the suspension of the qualification of such Securities for offering or
sale in any jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the Commission
for the amending or supplementing of the Registration Statement or
Prospectus or for additional information; and, in the event of the
issuance of any such stop order or of any such order preventing or
suspending the use of any prospectus relating to the Securities or
suspending any such qualification, promptly to use its best efforts to
obtain the withdrawal of such order;
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Securities for
offering and sale under the securities laws of such jurisdictions as
the Representatives may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the
distribution of such Securities, provided that in connection therewith
neither the Company nor the Guarantor shall be required to qualify as
a foreign entity or to file a general consent to service of process in
any jurisdiction;
(c) To furnish the Underwriters with copies of the
Prospectus as amended or supplemented in such quantities as the
Representatives may from time to time reasonably request, and, if the
delivery of a prospectus is required at any time in connection with
the offering or sale of the Securities and if at such time any event
shall have occurred as a result of which the Prospectus as then
amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not
misleading, or, if for any other reason it shall be necessary
10
<PAGE> 11
Draft of October 13, 1994
during such same period to amend or supplement the Prospectus or to
file under the Exchange Act any document incorporated by reference in
the Prospectus in order to comply with the Act or the Exchange Act, to
notify the Representatives and upon their request to file such
document and to prepare and furnish without charge to each Underwriter
and to any dealer in securities as many copies as the Representatives
may from time to time reasonably request of an amended Prospectus or a
supplement to the Prospectus which will correct such statement or
omission or effect such compliance;
(d) In the case of the Guarantor, to make generally
available to its security holders as soon as practicable, but in any
event not later than eighteen months after the effective date of the
Registration Statement (as defined in Rule 158(c) under the Act), an
earnings statement of the Guarantor and its subsidiaries (which need
not be audited) complying with Section 11(a) of the Act and the rules
and regulations of the Commission thereunder (including, at the option
of the Guarantor, Rule 158);
(e) During the period beginning from the date of the
Pricing Agreement for such Designated Securities and continuing to and
including the later of (i) the termination of trading restrictions for
such Designated Securities, as notified to the Company by the
Representatives and (ii) the First Time of Delivery or, if applicable,
the Second Time of Delivery, for such Designated Securities, not to
offer, sell, contract to sell or otherwise dispose of, except as
provided hereunder, any Preferred Securities, any preferred stock or
any other securities of the Company or the Guarantor that are
substantially similar to the Designated 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 the Company or
the Guarantor without the prior written consent of the
Representatives;
(f) To use its best efforts to have approved for listing,
subject to notice of issuance, the Designated Securities on The New
York Stock Exchange, Inc. (the "Exchange"); and
(g) To use its best efforts to list the Debentures, which
may be issued in exchange for Designated Securities upon a liquidation
of the Company in certain events, on the Exchange at the time of such
exchange.
6. Each of the Company and the Guarantor jointly and severally
covenants and agrees with the several Underwriters that the Company will pay or
cause to be paid the following: (i) the fees, disbursements and expenses of
counsel and accountants for the Company and the Guarantor in connection with
the registration of the Securities under the Act and all other expenses in
connection with the preparation, printing and filing of the Registration
Statement, any Preliminary Prospectus
11
<PAGE> 12
Draft of October 13, 1994
and the Prospectus and amendments and supplements thereto and the mailing and
delivering of copies thereof to the Underwriters and dealers; (ii) the cost of
printing or producing any Agreement among Underwriters, this Agreement, any
Pricing Agreement, the Indenture, the Securities, any Blue Sky Memoranda,
closing documents (including any compilations thereof) and any other documents
in connection with the offering, purchase, sale and delivery of the Securities;
(iii) all expenses in connection with the qualification of the Securities for
offering and sale under state securities laws as provided in Section 5(b)
hereof, including the reasonable fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the
Blue Sky survey(s); (iv) any fees charged by securities rating services for
rating the Securities; (v) any filing fees incident to, and the reasonable fees
and disbursements of counsel for the Underwriters in connection with, any
required reviews by the National Association of Securities Dealers, Inc. of the
terms of the sale of the Securities; (vi) any fees and expenses in connection
with listing the Securities; (vii) any cost of preparing certificates for the
Securities; (viii) the cost of qualifying the Securities with The Depository
Trust Company; (ix) the cost and charges of any transfer agent or registrar or
dividend disbursing agent; and (x) all other costs and expenses incident to the
performance of its obligations hereunder and under any Over-allotment Options
which are not otherwise specifically provided for in this Section, including
any such expenses relating to the Indenture and the Debentures. It is
understood, however, that, except as provided in this Section, and Sections 8
and 11 hereof, the Underwriters will pay all of their own costs and expenses,
including the fees of their counsel, transfer taxes on resale of any of the
Securities by them, and any advertising expenses connected with any offers they
may make.
7. The obligations of the Underwriters of any Designated
Securities under the Pricing Agreement relating to such Designated Securities
shall be subject, at each Time of Delivery, in the discretion of the
Representatives, to the condition that all representations and warranties and
other statements of the Company and the Guarantor in or incorporated by
reference in the Pricing Agreement relating to such Designated Securities are,
at and as of such Time of Delivery for such Designated Securities, true and
correct, the condition that the Company and the Guarantor shall have performed
all of their respective obligations hereunder theretofore to be performed, and
the following additional conditions:
(a) The Prospectus as amended or supplemented in relation
to such Designated Securities shall have been filed with the
Commission pursuant to Rule 424(b) within the applicable time period
prescribed for such filing by the rules and regulations under the Act
and in accordance with Section 5(a) hereof; no stop order suspending
the effectiveness of the Registration Statement or any part thereof
shall have been issued and no proceeding for that purpose shall have
been initiated or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to the Representatives' reasonable satisfaction;
12
<PAGE> 13
Draft of October 13, 1994
(b) Counsel for the Underwriters shall have furnished to
the Representatives such opinion or opinions, dated each Time of
Delivery for such Designated Securities, with respect to the matters
covered in paragraphs (i)(a), (i)(c), (ii)(b), (ii)(d), (iii), (v),
(ix), (x), (xi) and (xiii) of Section 7(c) below, and further to the
effect that under current law and interpretations of current law
issued by the Commission, neither the Company nor the Guarantor is an
"investment company" required to register under, or an "affiliated
person" of, or "promoter" or "principal underwriter" for, an
"investment company" as such terms are defined in, the Investment
Company Act, nor will be required to so register, nor will be such
after giving effect to the transactions contemplated hereby, as well
as such other related matters as the Representatives may reasonably
request, and such counsel shall have received such papers and
information as they may reasonably request to enable them to pass upon
such matters; provided, that in rendering such opinion, and insofar as
such opinion involves Delaware laws governing limited partnerships,
such counsel may rely, as to all such matters, upon the opinion of
Richards, Layton & Finger, P.A., special Delaware counsel to the
Company and the Guarantor;
(c) Christopher M. McLain, Senior Vice President and
General Counsel for the Guarantor, as counsel for the Company and the
Guarantor, shall have furnished to the Representatives his written
opinion, dated such Time of Delivery for such Designated Securities,
in form and substance satisfactory in the exercise of the reasonable
judgment of the Representatives, to the effect that:
(i) (a) The Company has been duly formed and
is validly existing as a limited partnership in good standing
under the laws of Delaware;
(b) The Company has, under the Delaware
Act and the Partnership Agreement, all necessary partnership
power and authority to own its properties and conduct its
business as described in the Prospectus as amended or
supplemented;
(c) The Guarantor has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of Delaware; and
(d) The Guarantor has all necessary
corporate power and authority to own its properties and
conduct its business as described in the Prospectus as amended
or supplemented;
(ii) (a) The Guarantor has an authorized
capitalization as set forth in the Prospectus as amended or
supplemented and all outstanding shares of capital
13
<PAGE> 14
Draft of October 13, 1994
stock of the Guarantor have been duly and validly authorized
and issued and are fully paid and nonassessable;
(b) The Preferred Securities issued to
the Preferred Securityholders have been duly and validly
authorized and are validly issued and, subject to the
qualifications set forth herein, are fully paid and
nonassessable limited partner interests in the Company as to
which, assuming that the Preferred Securityholders, as limited
partners of the Company, do not participate in the control of
the business of the Company, the Preferred Securityholders, as
limited partners of the Company, will have no liability solely
by reason of being Preferred Securityholders in excess of
their obligations to make payments provided for in the
Partnership Agreement and their share of the Company's assets
and undistributed profits (subject to the obligation of a
Preferred Securityholder to repay any funds wrongfully
distributed to it);
(c) LP Holdings is (excepting the
Preferred Securityholders), the sole limited partner of the
Company, the general partner interests in the Company and
the limited partner interests issued to LP Holdings have been
duly and validly authorized, are validly issued and are owned
directly or indirectly by the Guarantor, free and clear of all
liens, encumbrances, equities or claims;
(d) The Securities conform to the
description thereof contained in the Registration Statement
and the Designated Securities conform to the descriptions
thereof in the Prospectus as amended or supplemented; and
(e) The Company is not a party to or
otherwise bound by any agreement other than those described in
the Prospectus as amended or supplemented;
(iii) The Partnership Agreement has been duly
authorized by the Guarantor and by LP Holdings and constitutes
a legal, valid and binding agreement of the Guarantor and LP
Holdings, enforceable against the Guarantor and LP Holdings by
the Preferred Securityholders in accordance with its terms,
subject to bankruptcy, insolvency, reorganization, moratorium
and other laws of general applicability relating to or
affecting creditors' rights, and to general equity principles;
14
<PAGE> 15
Draft of October 13, 1994
(iv) To the best of such counsel's knowledge and
other than as set forth in the Prospectus, there are no legal
or governmental proceedings pending to which the Company, the
Guarantor or any of its subsidiaries is a party or of which
any property of the Company, the Guarantor or any of its
subsidiaries is the subject which, if determined adversely to
the Company, the Guarantor or any of its subsidiaries, would
individually or in the aggregate have a material adverse
effect on the consolidated financial position, partnership
interests or shareholders' equity, as applicable, or results
of operations of the Company or the Guarantor and its
subsidiaries taken as a whole; and to the best of such
counsel's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by
others;
(v) This Agreement and the Pricing Agreement with
respect to the Designated Securities have been duly
authorized, executed and delivered by the Company and the
Guarantor and the Company and the Guarantor have duly
authorized the performance of their respective obligations
hereunder and thereunder;
(vi) The issue and sale of the Designated
Securities being delivered at such Time of Delivery and the
compliance by the Company and the Guarantor each with all of
the provisions of this Agreement, any Pricing Agreement and
each Over-allotment Option, if any, and the execution,
delivery and performance by the Guarantor of its obligations
under the Indenture, the Debentures and the Guarantee and the
performance by the Guarantor and the Company of their
respective obligations hereunder and thereunder and the
consummation of the transactions herein and therein
contemplated, will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute
a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument known to such
counsel to which the Company or the Guarantor or any of its
subsidiaries is a party or by which the Company or the
Guarantor or any of its subsidiaries is bound or to which any
of the property or assets of the Company or the Guarantor or
any of its subsidiaries is subject, nor will such action
result in any violation of any statute or any order, rule or
regulation known to such counsel of any court or governmental
agency or body having jurisdiction over the Company or the
Guarantor or any of its subsidiaries or any of its properties,
in each case except for conflicts, breaches, violations or
defaults which would not, individually or in the aggregate,
have a material adverse effect on the general affairs,
consolidated financial position, partnership interests or
shareholders' equity, as applicable, or results of operations
of the Guarantor and its subsidiaries, taken as a whole, and
which will not interfere with the consummation of the
transactions contemplated herein or affect the validity of the
Securities purchased hereby, nor will such action result in
any violation of the provisions
15
<PAGE> 16
Draft of October 13, 1994
of the Partnership Agreement or the Certificate
of Incorporation or By-laws of the Guarantor;
(vii) No consent, approval, authorization, order,
registration or qualification of or with any such court or
governmental agency or body is required for the issue and sale
of the Designated Securities being delivered at such Time of
Delivery or the consummation by the Company and the Guarantor
of the transactions contemplated by this Agreement, any
Pricing Agreement, the Indenture, the Debentures, the
Guarantee or any Over- allotment Option, except such as have
been obtained under the Act and the Trust Indenture Act and
such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or
Blue Sky laws in connection with the purchase and distribution
of the Designated Securities by the Underwriters;
(viii) None of the Company, the Guarantor or LP
Holdings is in violation of the Partnership Agreement, none of
the Guarantor or any of its subsidiaries is in violation of
its respective Certificate of Incorporation or By-laws, and
none of the Company, the Guarantor or any of its subsidiaries
is in default in the performance or observance of any material
obligation, agreement, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement, lease or
other agreement or instrument to which it is a party or by
which it or any of its properties may be bound;
(ix) The statements set forth in the Prospectus
under the captions "Description of the Preferred Securities,"
"Description of the Guarantee," "Description of the Junior
Subordinated Debentures," "Description of the Series A
Preferred Securities," "Description of the Series A Junior
Subordinated Debentures" and "Relationship between the Series
A Preferred Securities, the Series A Junior Subordinated
Debentures and the Guarantee," insofar as they purport to
constitute a summary of the terms of the Securities, are
accurate in all material respects and fairly summarize the
subject matter thereof;
(x) The Guarantee has been duly authorized and,
when issued and delivered pursuant to this Agreement, will
have been duly executed, issued and delivered and will
constitute a valid and legally binding obligation of the
Guarantor, enforceable in accordance with its terms, subject
to bankruptcy, insolvency, reorganization, moratorium and
other laws of general applicability relating to or affecting
creditors' rights and to general equity principles;
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Draft of October 13, 1994
(xi) (a) The Debentures have been duly
authorized, executed and delivered by the Guarantor and,
assuming due authentication, execution and delivery thereof by
the Trustee, when issued and delivered will constitute valid
and legally binding obligations of the Guarantor entitled to
the benefits provided by the Indenture and enforceable in
accordance with their terms, subject to bankruptcy,
insolvency, reorganization, moratorium and other laws of
general applicability relating to or affecting creditors'
rights and to general equity principles;
(b) The Indenture has been duly
authorized, executed and delivered by the Guarantor and,
assuming due authorization, execution and delivery thereof by
the Trustee, will constitute a valid and legally binding
instrument, enforceable in accordance with its terms, subject
to bankruptcy, insolvency, reorganization, moratorium and
other laws of general applicability relating to or affecting
creditors' rights and to general equity principles; the
Indenture has been duly qualified under the Trust Indenture
Act; and
(c) The Guarantee, the Debentures and
the Indenture conform to the descriptions thereof in the
Prospectus;
(xii) (a) The documents incorporated by
reference in the Prospectus as amended or supplemented (other
than the financial statements and related notes and the
financial statement schedules and other financial data
included therein, as to which such counsel need express no
opinion), when they became effective or were filed with the
Commission, as the case may be, complied as to form in all
material respects with the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of
the Commission thereunder; and
(b) Such counsel has no reason to
believe that any of such documents, when they became effective
or were filed, as the case may be, contained, in the case of a
registration statement which became effective under the Act,
an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to
make the statements therein not misleading, or, in the case of
other documents which were filed under the Act or the Exchange
Act with the Commission, an untrue statement of a material
fact or omitted to state a material fact necessary in order to
make the statements therein, in the light of the circumstances
under which they were made when such documents were so filed,
not misleading; and
17
<PAGE> 18
Draft of October 13, 1994
(xiii) (a) The Registration Statement and the
Prospectus as amended or supplemented, and any further
amendments and supplements thereto made by the Company or the
Guarantor prior to such Time of Delivery (other than the
financial statements and related notes and the financial
statement schedules and other financial data included therein,
as to which such counsel need express no opinion), comply as
to form in all material respects with the requirements of the
Act and the Trust Indenture Act and the respective rules and
regulations thereunder; and
(b) Although such counsel does not
assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration
Statement or the Prospectus, except for those referred to in
the opinion in subsection (ix) of this Section 7(c), such
counsel has no reason to believe that, as of its effective
date, the Registration Statement or any further amendment
thereto made by the Company prior to such Time of Delivery
(other than the financial statements and related notes and the
financial statement schedules and other financial data
included therein, as to which such counsel need express no
opinion) contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or
that, as of its date, the Prospectus as amended or
supplemented or any further amendment or supplement thereto
made by the Company or the Guarantor prior to such Time of
Delivery (other than the financial statements and related
notes and the financial statement schedules and other
financial data included therein, as to which such counsel need
express no opinion) contained an untrue statement of a
material fact or omitted to state a material fact necessary to
make the statements therein, in the light of the circumstances
under which they were made, not misleading or that, as of such
Time of Delivery, either the Registration Statement or the
Prospectus as amended or supplemented or any further amendment
or supplement thereto made by the Company or the Guarantor
prior to such Time of Delivery (other than the financial
statements and related notes and the financial statement
schedules and other financial data included therein, as to
which such counsel need express no opinion) contains an untrue
statement of a material fact or omits to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and
such counsel does not know of any amendment to the
Registration Statement required to be filed or any contracts
or other documents of a character required to be filed as an
exhibit to the Registration Statement, incorporated by
reference into the Prospectus as amended or supplemented or
required to be described in the Registration Statement or the
Prospectus as amended or supplemented which are not filed or
incorporated by reference or described as required;
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Draft of October 13, 1994
In rendering such opinion, such counsel may state
that he expresses no opinion as to the laws of any jurisdiction other
than the Federal laws of the United States, the laws of the State of
California and the General Corporation Law of the State of Delaware,
and that, insofar as such opinion involves factual matters he has
relied, to the extent he deems proper, upon certificates of officers
of the Guarantor and certificates of public officials, and that
insofar as such opinion involves Delaware laws governing limited
partnerships, he has relied, as to all such matters, on the opinion of
Richards, Layton & Finger, P.A., special Delaware counsel to the
Company and the Guarantor.
(d) Wachtell, Lipton, Rosen & Katz, special counsel for
the Company and the Guarantor, shall have furnished to you their
written opinion, dated such Time of Delivery, in form and substance
reasonably satisfactory to the Representatives, with respect to the
matters covered in paragraphs (i)(a), (i)(c), (ii)(b), (ii)(d), (iii),
(v), (ix), (x), (xi) and (xiii)(a) of Section 7(c) above) and further
to the effect that: (A) under current law and interpretations of
current law issued by the Commission the Company is not an "investment
company" or an entity "controlled" by an "investment company"; and (B)
such counsel has reviewed its opinion on matters of U.S. tax law set
forth in any prospectus supplement relating to the Designated
Securities being delivered at such Time of Delivery and confirms such
opinion to the Representatives; and such counsel shall have received
such papers and information as they may reasonably request to enable
them to pass upon such matters;
In rendering such opinion, such counsel may state
that they express no opinion as to the laws of any jurisdiction other
than the Federal laws of the United States, the laws of the State of
New York and the General Corporation Law of the State of Delaware,
that, insofar as such opinion involves factual matters (including
facts underlying the opinion in paragraph (A) above), they have
relied, to the extent they deems proper, upon certificates of officers
of the Guarantor and certificates of public officials, and that
insofar as such opinion involves Delaware laws governing limited
partnerships, they have relied, as to all such matters, on the opinion
of Richards, Layton & Finger, P.A., special Delaware counsel to the
Company and the Guarantor.
(e) Richards, Layton & Finger, P.A., special Delaware
counsel to the Company and the Guarantor, shall have furnished
to you their written opinion, substantially in the form attached
hereto as Annex III, dated such Time of Delivery, with respect to the
formation of the Company, the validity of the Preferred Securities,
the Partnership Agreement, statements of Delaware law contained in
the Prospectus as amended or supplemented and other related matters
as the Representatives may reasonably request, and such counsel shall
have received such papers and information as they may reasonably
request to enable them to pass upon such matters;
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Draft of October 13, 1994
(f) On the date of the Pricing Agreement for such
Designated Securities at a time prior to the execution of the Pricing
Agreement with respect to the Designated Securities and at each Time
of Delivery for such Designated Securities, the independent
accountants of the Company who have certified the financial statements
of the Guarantor and its subsidiaries included or incorporated by
reference in the Registration Statement shall have furnished to the
Representatives a letter, dated the effective date of the Registration
Statement or the date of the most recent report filed with the
Commission containing financial statements and incorporated by
reference in the Registration Statement, if the date of such report is
later than such effective date, and a letter dated such Time of
Delivery, respectively, to the effect set forth in Annex II hereto,
and with respect to such letter dated such Time of Delivery, as to
such other matters as the Representatives may reasonably request and
in form and substance satisfactory to the Representatives in the
exercise of their reasonable judgment;
(g) (i) None of the Company, the Guarantor or any of the
Guarantor's subsidiaries shall have sustained since the date of the
latest audited financial statements included or incorporated by
reference in the Prospectus as amended prior to the date of the
Pricing Agreement relating to the Designated Securities any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, in each case
otherwise than as set forth or contemplated in the Prospectus as
amended prior to the date of the Pricing Agreement relating to the
Designated Securities, and (ii) since the respective dates as of which
information is given in the Prospectus as amended prior to the date of
the Pricing Agreement relating to the Designated Securities there
shall not have been any change in the partnership interests or
long-term debt of the Company or in the capital stock or long-term
debt of the Guarantor or the Guarantor's subsidiaries or any change,
or any development involving a prospective change, in or affecting the
general affairs, management, financial position, partnership interests
or shareholders' equity, as applicable, or results of operations of
the Company, the Guarantor and the Guarantor's subsidiaries, otherwise
than as set forth or contemplated in the Prospectus as amended prior
to the date of the Pricing Agreement relating to the Designated
Securities, the effect of which, in any such case described in Clause
(i) or (ii), is in the judgment of the Representatives so material and
adverse as to make it impracticable or inadvisable to proceed with the
public offering or the delivery of the Designated Securities on the
terms and in the manner contemplated in the Prospectus as amended or
supplemented relating to the Designated Securities;
(h) On or after the date of the Pricing Agreement
relating to the Designated Securities (i) no downgrading shall have
occurred in the rating accorded the Company's or the Guarantor's debt
securities or preferred stock by any "nationally recognized
statistical rating organization," as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act, and (ii) no
such organization shall have publicly announced that it
20
<PAGE> 21
Draft of October 13, 1994
has under surveillance or review, with possible negative implications,
its rating of any of the Company's or the Guarantor's debt securities
or preferred stock;
(i) On or after the date of the Pricing Agreement
relating to the Designated Securities there shall not have occurred
any of the following: (i) a suspension or material limitation in
trading in securities generally on the Exchange; (ii) a suspension or
material limitation in trading in the Company's or the Guarantor's
securities on the Exchange; (iii) a general moratorium on commercial
banking activities declared by either Federal or New York State
authorities; or (iv) the outbreak or escalation of hostilities
involving the United States or the declaration by the United States of
a national emergency or war, if the effect of any such event specified
in this Clause (iv) in the judgment of the Representatives makes it
impracticable or inadvisable to proceed with the public offering or
the delivery of the Firm Securities or Optional Securities or both on
the terms and in the manner contemplated in the Prospectus as first
amended or supplemented relating to the Designated Securities;
(j) The Preferred Securities included within the
Designated Securities at such Time of Delivery shall have been duly
authorized for listing, subject to notice of issuance, on the
Exchange; and
(k) The Company shall have furnished or caused to be
furnished to the Representatives at such Time of Delivery for the
Designated Securities certificates of officers of the Company and the
Guarantor satisfactory to the Representatives as to the accuracy of
the representations and warranties of the Company and the Guarantor
herein at and as of such Time of Delivery, as to the performance by
the Company and the Guarantor of all of their obligations hereunder to
be performed at or prior to such Time of Delivery, as to the matters
set forth in subsections (a) and (g) of this Section and as to such
other matters as the Representatives may reasonably request.
8. (a) The Company and the Guarantor, jointly and severally,
will indemnify and hold harmless each Underwriter of Designated Securities
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged untrue statement
of a material fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating or defending any such
action or claim as such expenses are incurred; provided, however, that neither
the Company nor the Guarantor shall
21
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Draft of October 13, 1994
be liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary Prospectus,
any preliminary prospectus supplement, the Registration Statement, the
Prospectus as amended or supplemented and any other prospectus relating to the
Securities, or any amendment or supplement thereto in reliance upon and in
conformity with written information furnished to the Company by any Underwriter
of Designated Securities through the Representatives expressly for use in any
of these documents and provided, further, that the Company and the Guarantor
shall not be liable to any Underwriter under the indemnity agreement in this
subsection (a) with respect to any Preliminary Prospectus to the extent that
any such loss, claim, damage or liability of such Underwriter results from the
fact that such Underwriter sold Securities to a person as to whom it shall be
established that there was not sent or given, at or prior to the written
confirmation of such sale, a copy of the Prospectus (excluding documents
incorporated by reference) or of the Prospectus as amended or supplemented
(excluding documents incorporated by reference) in any case where such delivery
is required by the Act if the Company or the Guarantor has previously furnished
copies thereof in sufficient quantity to such Underwriter and the loss, claim,
damage or liability of such Underwriter results from an untrue statement or
omission of a material fact contained in the Preliminary Prospectus which was
corrected in the Prospectus (excluding documents incorporated by reference) or
the Prospectus as amended or supplemented (excluding documents incorporated by
reference).
(b) Each Underwriter will indemnify and hold harmless the Company
and the Guarantor against any losses, claims, damages or liabilities to which
the Company may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each
case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, any preliminary prospectus supplement, the Registration
Statement, the Prospectus as amended or supplemented and any other prospectus
relating to the Securities, or any amendment or supplement thereto in reliance
upon and in conformity with written information furnished to the Company and
the Guarantor by such Underwriter through the Representatives expressly for use
therein; and will reimburse the Company and the Guarantor for any legal or
other expenses reasonably incurred by the Company in connection with
investigating or defending any such action or claim as such expenses are
incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against an
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify such
indemnifying party shall
22
<PAGE> 23
Draft of October 13, 1994
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses
of other counsel or any other expenses, in each case subsequently incurred by
such indemnified party, in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without the
written consent of the indemnified party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified party is an actual or
potential party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from
all liability arising out of such action or claim and (ii) does not include any
statement as to, or an admission of, fault, culpability or a failure to act, by
or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is appropriate to reflect
the relative benefits received by the Company and the Guarantor on the one hand
and the Underwriters of the Designated Securities on the other from the
offering of the Designated Securities to which such loss, claim, damage or
liability (or action in respect thereof) relates. If, however, the allocation
provided by the immediately preceding sentence is not permitted by applicable
law or if the indemnified party failed to give the notice required under
subsection (c) above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company and the Guarantor on the one hand and the Underwriters of
the Designated Securities on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Company and the
Guarantor on the one hand and such Underwriters on the other shall be deemed to
be in the same proportion as the total net proceeds from such offering (before
deducting expenses) received by the Company and the Guarantor bear to the total
underwriting discounts and commissions received by such Underwriters. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company and the Guarantor on the one hand or such Underwriters on the other
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The
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Draft of October 13, 1994
Company, the Guarantor and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this subsection (d) were determined by
pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to
above in this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the applicable Designated Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The obligations of the Underwriters of
Designated Securities in this subsection (d) to contribute are several in
proportion to their respective underwriting obligations with respect to such
Securities and not joint.
(e) The obligations of the Company under this Section 8 shall be
in addition to any liability which the Company and the Guarantor may otherwise
have and shall extend, upon the same terms and conditions, to each person, if
any, who controls any Underwriter within the meaning of the Act; and the
obligations of the Underwriters under this Section 8 shall be in addition to
any liability which the respective Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of the
Company and the Guarantor and to each person, if any, who controls the Company
and the Guarantor within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to
purchase the Firm Securities or Optional Securities which it has agreed to
purchase under the Pricing Agreement relating to such Securities, the
Representatives may in their discretion arrange for themselves or another party
or other parties to purchase such Securities on the terms contained herein. If
within thirty-six hours after such default by any Underwriter the
Representatives do not arrange for the purchase of such Firm Securities or
Optional Securities, as the case may be, then the Company shall be entitled to
a further period of thirty-six hours within which to procure another party or
other parties satisfactory to the Representatives to purchase such Securities
on such terms. In the event that, within the respective prescribed period, the
Representatives notify the Company that they have so arranged for the purchase
of such Securities, or the Company notifies the Representatives that it has so
arranged for the purchase of such Securities, the Representatives or the
Company shall have the right to postpone the relevant Time of Delivery for such
Securities for a period of not more than seven days, in order to effect
whatever changes may thereby be made necessary in the Registration Statement or
the Prospectus as amended or supplemented, or in any other documents or
arrangements, and the Company agrees to file promptly any amendments or
supplements to the Registration Statement or the Prospectus which in the
opinion of the Representatives may thereby
24
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Draft of October 13, 1994
be made necessary. The term "Underwriter" as used in this Agreement shall
include any person substituted under this Section with like effect as if such
person had originally been a party to the Pricing Agreement with respect to
such Designated Securities.
(b) If, after giving effect to any arrangements for the purchase
of the Firm Securities or Optional Securities, as the case may be, of a
defaulting Underwriter or Underwriters by the Representatives and the Company
as provided in subsection (a) above, the aggregate number of such Securities
which remains unpurchased does not exceed one-eleventh of the aggregate number
of the Firm Securities or Optional Securities, as the case may be, to be
purchased at the relevant Time of Delivery, then the Company shall have the
right to require each non-defaulting Underwriter to purchase the number of Firm
Securities or Optional Securities, as the case may be, which such Underwriter
agreed to purchase under the Pricing Agreement relating to such Designated
Securities and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the number of Firm Securities or Optional
Securities, as the case may be, which such Underwriter agreed to purchase under
such Pricing Agreement) of the Firm Securities or Optional Securities, as the
case may be, of such defaulting Underwriter or Underwriters for which such
arrangements have not been made; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase
of the Firm Securities or Optional Securities, as the case may be, of a
defaulting Underwriter or Underwriters by the Representatives and the Company
as provided in subsection (a) above, the aggregate number of Firm Securities or
Optional Securities, as the case may be, which remains unpurchased exceeds
one-eleventh of the aggregate number of the Firm Securities or Optional
Securities, as the case may be, to be purchased at the relevant Time of
Delivery, as referred to in subsection (b) above, or if the Company shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Firm Securities or Optional Securities, as the case
may be, of a defaulting Underwriter or Underwriters, then the Pricing Agreement
relating to such Firm Securities or the Over-allotment Option relating to such
Optional Securities, as the case may be, shall thereupon terminate, without
liability on the part of any non-defaulting Underwriter or the Company or the
Guarantor with respect thereto, except for the expenses to be borne by the
Company and the Guarantor and the Underwriters as provided in Section 6 hereof
and the indemnity and contribution agreements in Section 8 hereof; but nothing
herein shall relieve a defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations,
warranties and other statements of the Company or the Guarantor and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and
effect, regardless of any investigation (or any statement as to the results
thereof) made by or on behalf of any Underwriter or any controlling person of
any Underwriter, or the
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Draft of October 13, 1994
Company or the Guarantor, or any officer or director or controlling person of
the Company or the Guarantor, and shall survive delivery of and payment for the
Securities.
11. If any Pricing Agreement or Over-allotment Option shall be
terminated pursuant to Section 9 hereof, neither the Company nor the Guarantor
shall then be under any liability to any Underwriter with respect to the Firm
Securities or Optional Securities with respect to which such Pricing Agreement
shall have been terminated except as provided in Sections 6 and 8 hereof; but,
if for any other reason Designated Securities are not delivered by or on behalf
of the Company or the Guarantor as provided herein, the Company will reimburse
the Underwriters through the Representatives for all out-of-pocket expenses
approved in writing by the Representatives, including fees and disbursements of
counsel, reasonably incurred by the Underwriters in making preparations for the
purchase, sale and delivery of such Designated Securities, but the Company or
the Guarantor shall then be under no further liability to any Underwriter with
respect to such Designated Securities except as provided in Sections 6 and 8
hereof.
12. In all dealings hereunder, the Representatives of the
Underwriters of Designated Securities shall act on behalf of each of such
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by such Representatives jointly or by such of the Representatives, if
any, as may be designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex
or facsimile transmission to the address of the Representatives as set forth in
the Pricing Agreement; and if to the Company or the Guarantor shall be
delivered or sent by mail, telex or facsimile transmission to the address of
the Company or the Guarantor, respectively, set forth in the Registration
Statement, Attention: Secretary; provided, however, that any notice to an
Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by mail,
telex or facsimile transmission to such Underwriter at its address set forth in
its Underwriters' Questionnaire, or telex constituting such Questionnaire,
which address will be supplied to the Company and the Guarantor by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement and each Pricing Agreement shall be binding
upon, and inure solely to the benefit of, the Underwriters, the Company, the
Guarantor and, to the extent provided in Sections 8 and 10 hereof, the officers
and directors of the Company, the Guarantor and each person who controls the
Company or the Guarantor or any Underwriter, and their respective heirs,
executors, administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement or any such
Pricing Agreement. No purchaser of any of the Securities from any Underwriter
shall be deemed a successor or assign by reason merely of such purchase.
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Draft of October 13, 1994
14. Time shall be of the essence of each Pricing Agreement. As
used herein, the term "business day" shall mean any day when the Commission's
office in Washington, D.C. is open for business.
15. THIS AGREEMENT AND EACH PRICING AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
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Draft of October 13, 1994
16. This Agreement and each Pricing Agreement may be executed by
any one or more of the parties hereto and thereto in any number of
counterparts, each of which shall be deemed to be an original, but all such
respective counterparts shall together constitute one and the same instrument.
If the foregoing is in accordance with your understanding, please sign
and return to us 10 counterparts hereof.
Very truly yours,
Transamerica Delaware, L.P.
By:________________________
Name:
Title:
Transamerica Corporation
By:_________________________
Name:
Title:
Accepted as of the date hereof:
Goldman, Sachs & Co.
[Name(s) of Co-Representative(s)]
By:________________________________
(Goldman, Sachs & Co.)
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Draft of October 13, 1994
ANNEX I
Pricing Agreement
Goldman, Sachs & Co.,
[Name(s) of Co-Representative(s),]
c/o Goldman, Sachs & Co.
85 Broad Street,
New York, New York 10004
, 19__
Ladies and Gentlemen:
Transamerica Delaware, L.P., a Delaware limited partnership (the
"Company"), and Transamerica Corporation, a Delaware corporation, as general
partner of the Company and as guarantor ("Transamerica" or the "Guarantor")
propose, subject to the terms and conditions stated herein and in the
Underwriting Agreement, dated October __, 1994 (the "Underwriting Agreement"),
between the Company on the one hand and Goldman, Sachs & Co. and [names of
Co-Representatives named therein] on the other hand, to issue and sell to the
Underwriters named in Schedule I hereto (the "Underwriters") the Securities
specified in Schedule II hereto (the "Designated Securities" consisting of Firm
Securities and any Optional Securities the Underwriters may elect to purchase).
The Designated Securities will be guaranteed by the Guarantor to the extent set
forth in the Guarantee Agreement with respect to such Designated Securities
(the "Guarantee"). Each of the provisions of the Underwriting Agreement is
incorporated herein by reference in its entirety, and shall be deemed to be a
part of this Agreement to the same extent as if such provisions had been set
forth in full herein; and each of the representations and warranties set forth
therein shall be deemed to have been made at and as of the date of this Pricing
Agreement, except that each representation and warranty which refers to the
Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a
representation or warranty as of the date of the Underwriting Agreement in
relation to the Prospectus (as therein defined), and also a representation and
warranty as of the date of this Pricing Agreement in relation to the Prospectus
as amended or supplemented relating to the Designated Securities which are the
subject of this Pricing Agreement. Each reference to the Representatives
herein and in the provisions of the Underwriting Agreement so incorporated by
reference shall be deemed to refer to you. Unless otherwise defined herein,
terms defined in the Underwriting Agreement are used herein as therein defined.
The Representatives designated to act on behalf of the Representatives and on
behalf of each of the Underwriters of the Designated Securities pursuant to
Section 12 of the Underwriting Agreement and the address of the Representatives
referred to in said Section 12 are set forth in Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, [(a)] the Company
agrees to issue and sell to each of the
<PAGE> 30
Draft of October 13, 1994
Underwriters, and each of the Underwriters agrees, severally and not jointly,
to purchase from the Company, at the time and place and at the purchase price
to the Underwriters set forth in Schedule II hereto, the number of Firm
Securities set forth opposite the name of such Underwriter in Schedule I hereto
[and, (b) in the event and to the extent that the Underwriters shall exercise
the election to purchase Optional Securities, as provided below, the Company
agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company at
the purchase price to the Underwriters set forth in Schedule II hereto, that
portion of the number of Optional Securities as to which such election shall
have been exercised].
[The Company hereby grants to each of the Underwriters the right to
purchase at their election up to the number of Optional Securities set forth
opposite the name of such Underwriter in Schedule I hereto on the terms
referred to in the paragraph above for the sole purpose of covering
over-allotments in the sale of the Firm Securities. Any such election to
purchase Optional Securities may be exercised by written notice from the
Representatives to the Company given within a period of 30 calendar days after
the date of this Pricing Agreement, setting forth the aggregate number of
Optional Securities to be purchased and the date on which such Optional
Securities are to be delivered, as determined by the Representatives, but in no
event earlier than the First Time of Delivery or, unless the Representatives
and the Company otherwise agree in writing, earlier than two or later than ten
business days after the date of such notice.
If the foregoing is in accordance with your understanding, please sign and
return to us 10 counterparts hereof, and upon acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, shall constitute a binding agreement between each of the
Underwriters, on the one hand, and the Company and the Guarantor, on the other
hand. It is understood that your acceptance of this letter on behalf of each
of the Underwriters is or will be pursuant to the authority set forth in a form
of Agreement among Underwriters, the form of which
2
<PAGE> 31
Draft of October 13, 1994
shall be submitted to the Company for examination and the Guarantor, upon
request, but without warranty on the part of the Representatives as to the
authority of the signers thereof.
Very truly yours,
Transamerica Delaware, L.P.
By: Transamerica Corporation,
General Partner
By: ________________________________
Name:
Title:
Transamerica Corporation
By: ____________________________________
Name:
Title:
Accepted as of the date hereof:
Goldman, Sachs & Co.
[Name(s) of Co-Representative(s)]
By: _____________________________
(Goldman, Sachs & Co.)
3
<PAGE> 32
Draft of October 13, 1994
<TABLE>
<CAPTION>
SCHEDULE I
MAXIMUM NUMBER
OF OPTIONAL
NUMBER OF SECURITIES WHICH
FIRM SECURITIES MAY BE
UNDERWRITER TO BE PURCHASED PURCHASED
----------- --------------- ---------
<S> <C> <C>
Goldman, Sachs & Co. . . . . . . . . . . . . . . . . . . . . . . . .
[Name(s) of Co-Representative(s)] . . . . . . . . . . . . . . . . . .
Total
</TABLE>
4
<PAGE> 33
Draft of October 13, 1994
SCHEDULE II
TITLE OF DESIGNATED SECURITIES:
________ Cumulative Monthly Income Preferred Securities, Series ____,
(liquidation preference $________ per Series ____ Preferred Security)
NUMBER OF DESIGNATED SECURITIES:
Number of Firm Securities:
Maximum Number of Optional Securities:
INITIAL OFFERING PRICE TO PUBLIC:
$________ per Security
PURCHASE PRICE BY UNDERWRITERS:
$________ per Security
COMMISSION PAYABLE TO UNDERWRITERS:
$________ per Security in funds
FORM OF DESIGNATED SECURITIES:
Book-entry-only form represented by one or more global securities deposited
with The Depository Trust Company ("DTC") or its designated custodian, to
be made available for checking by the Representatives at least twenty-four
hours prior to the Time of Delivery at the office of DTC.
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
funds
5
<PAGE> 34
Draft of October 13, 1994
LIQUIDATION PREFERENCE:
$__ per Security
DIVIDEND RATE:
________% per annum per Security
DIVIDEND PAYMENT DATES:
[The last day of each calendar month, commencing ____________, 19__]
DIVIDEND RIGHTS:
As described in the draft prospectus supplement attached hereto.
VOTING RIGHTS:
As described in the draft prospectus supplement attached hereto.
LIQUIDATION RIGHTS:
As described in the draft prospectus supplement attached hereto.
REDEMPTION AND EXCHANGE PROVISIONS:
The Designated Securities may be redeemed, in whole or in part, at the
option of the Company on or after ____________, ____ at $________ per
Security, plus accrued and unpaid dividends to the date fixed for
redemption (the "Redemption Price").
Other redemption provisions, as described in the draft prospectus
supplement attached hereto.
SINKING FUND PROVISIONS:
[None]
6
<PAGE> 35
Draft of October 13, 1994
GUARANTEE:
Guarantee Agreement, dated as of October __, 1994, of Transamerica
Corporation
TRADING RESTRICTIONS:
Transamerica and the Company 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 __
Preferred Securities, as notified to Transamerica by the Representatives,
and (ii) the latest time of delivery for such Series __ 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
the Company that are substantially similar to the Series __ 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 the Company, without the prior written
consent of the Representatives.
TIME OF DELIVERY:
________ a.m. (New York City time), _________________, 19__
CLOSING LOCATION:
NAMES AND ADDRESSES OF REPRESENTATIVES:
Designated Representatives:
Address for Notices, etc.:
[OTHER TERMS]* :
__________________________________
* A DESCRIPTION OF PARTICULAR TAX, ACCOUNTING OR OTHER UNUSUAL FEATURES
(INCLUDING ANY EVENT RISK PROVISIONS) OF THE DESIGNATED SECURITIES SHOULD BE
SET FORTH, OR REFERENCED TO AN ATTACHED OR ACCOMPANYING DESCRIPTION, IF
NECESSARY, TO ENSURE AGREEMENT AS TO THE TERMS OF THE DESIGNATED SECURITIES TO
BE PURCHASED AND SOLD. SUCH A DESCRIPTION MIGHT APPROPRIATELY BE IN THE FORM
IN WHICH SUCH FEATURES WILL BE DESCRIBED IN THE PROSPECTUS SUPPLEMENT FOR THE
OFFERING.
7
<PAGE> 36
Draft of October 13, 1994
ANNEX II
Pursuant to Section 7(f) of the Underwriting Agreement, the
accountants shall furnish letters to the Underwriters to the effect that:
(i) They are independent auditors with respect to the
Guarantor and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the consolidated financial
statements and financial statement schedules audited by them and
included or incorporated by reference in the Company's Annual Report
on Form 10-K for the year ended December 31, 1993 and incorporated by
reference in the Registration Statement comply as to form in all
material respects with the applicable accounting requirements of the
Act and the Exchange Act, and the related published rules and
regulations thereunder; [and, if applicable, they have made a review
in accordance with standards established by the American Institute of
Certified Public Accountants of the consolidated interim financial
statements, selected financial data, pro forma financial information,
financial forecasts and/or condensed financial statements derived from
audited financial statements of the Guarantor for the periods
specified in such letter, as indicated in their reports thereon,
copies of which have been separately furnished to the representatives
of the Underwriters (the "Representatives");]
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants
of the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus and/or included in the Guarantor's
quarterly reports on Form 10-Q incorporated by reference into the
Prospectus; and on the basis of specified procedures including
inquiries of officials of the Company who have responsibility for
financial and accounting matters regarding whether the unaudited
condensed consolidated financial statements referred to in paragraph
(vi)(A)(i) below comply as to form in all material respects with the
applicable accounting requirements of the Act and the Exchange Act and
the related published rules and regulations, nothing came to their
attention that caused them to believe that the unaudited condensed
consolidated financial statements do not comply as to form in all
material respects with the applicable accounting requirements of the
Act and the Exchange Act and the related published rules and
regulations;
(iv) The unaudited selected financial information with
respect to the consolidated results of operations and financial
position of the Guarantor for the five most recent fiscal years
included in the Prospectus and included or incorporated by reference
in Item 6 of the Guarantor's Annual Report on Form 10-K for the most
recent fiscal year agrees with the corresponding amounts (after
restatement where applicable) in the audited consolidated financial
statements for such five fiscal years which were included or
incorporated by reference in the Guarantor's Annual Reports on Form
10-K for such fiscal years;
(v) They have compared the information in the Prospectus
under selected captions with the disclosure requirements of Regulation
S-K and on the basis of limited procedures
<PAGE> 37
Draft of October 13, 1994
specified in such letter nothing came to their attention as a result
of the foregoing procedures that caused them to believe that this
information does not conform in all material respects with the
disclosure requirements of items 301, 302, 402 and 503(d),
respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting
an examination in accordance with generally accepted auditing
standards, consisting of a reading of the unaudited financial
statements and other information referred to below, a reading of the
latest available interim financial statements of the Guarantor and its
subsidiaries, inspection of the minute books of the Guarantor and its
subsidiaries since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus, inquiries of
officials of the Guarantor and its subsidiaries responsible for
financial and accounting matters and such other inquiries and
procedures as may be specified in such letter, nothing came to their
attention that caused them to believe that:
(A) (i) any material modifications should be made to the
unaudited condensed consolidated financial statements of
income, consolidated balance sheets and consolidated
statements of cash flows included in the Prospectus or
included in the Guarantor's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus, for them to be in
conformity with generally accepted accounting principles, or
(ii) the unaudited condensed consolidated financial statements
of income, consolidated balance sheets and consolidated
statements of cash flows included in the Prospectus and/or
included or incorporated by reference in the Guarantor's
Quarterly Reports on Form 10-Q incorporated by reference in
the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the
Exchange Act as it applies to Form 10-Q and the related
published rules and regulations, or
(B) any other unaudited income statement data and balance
sheet items included in the Prospectus do not agree with the
corresponding items in the unaudited consolidated financial
statements from which such data and items were derived, and
any such unaudited data and items were not determined on a
basis substantially consistent with the basis for the
corresponding amounts in the audited consolidated financial
statements included or incorporated by reference in the
Guarantor's Annual Report on Form 10-K for the most recent
fiscal year;
(C) the unaudited financial statements which were not
included in the Prospectus but from which were derived the
unaudited condensed financial statements referred to in clause
(A) and any unaudited income statement data and balance sheet
items included in the Prospectus and referred to in Clause (B)
were not determined on a basis substantially consistent with
the basis for the audited financial statements included or
incorporated by reference in the Guarantor's Annual Report on
Form 10-K for the most recent fiscal year;
2
<PAGE> 38
Draft of October 13, 1994
(D) any unaudited pro forma consolidated condensed
financial statements included or incorporated by reference in
the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the
Act and the published rules and regulations thereunder or the
pro forma adjustments have not been properly applied to the
historical amounts in the compilation of those statements;
(E) as of a specified date not more than five days prior
to the date of such letter, there have been any changes in the
consolidated capital stock (other than issuances of capital
stock upon exercise of options and stock appreciation rights,
upon earn-outs of performance shares and upon conversions of
convertible securities, in each case which were outstanding on
the date of the latest balance sheet included or incorporated
by reference in the Prospectus) or any increase in the
consolidated long-term debt of the Guarantor and its
subsidiaries, or any decreases in consolidated net current
assets or shareholders' equity, excluding the net unrealized
gain from investments market to fair value and foreign
currency translation adjustments, or other items specified by
the Representatives, or any increases in any items specified
by the Representatives, in each case as compared with amounts
shown in the latest balance sheet included or incorporated by
reference in the Prospectus, except in each case for changes,
increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter;
and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the
Prospectus to the specified date referred to in Clause (E)
there were any decreases in consolidated revenues from
continuing operations or operating profit or the total or per
share amounts of consolidated net income or other items
specified by the Representatives, or any increases in any
items specified by the Representatives, in each case as
compared with the comparable period of the preceding year and
with any other period of corresponding length specified by the
Representatives, except in each case for increases or
decreases which the Prospectus discloses have occurred or may
occur or which are described in such letter; and
(vii) In addition to the examination referred to in their
report(s) included or incorporated by reference in the Prospectus and
the limited procedures, inspection of minute books, inquiries and
other procedures referred to in paragraphs (iii) and (vi) above, they
have carried out certain specified procedures, not constituting an
examination in accordance with generally accepted auditing standards,
with respect to certain amounts, percentages and financial information
specified by the Representatives which are derived from the general
accounting records of the Guarantor and its subsidiaries, which appear
in the Prospectus (excluding documents incorporated by reference), or
in Part II of, or in exhibits and schedules to, the Registration
Statement specified by the Representatives or in documents
incorporated by reference in the Prospectus specified by the
Representatives, and have compared certain of such amounts,
percentages and financial information with the accounting records of
the Guarantor and its subsidiaries and have found them to be in
agreement.
All references in this Annex II to the Prospectus shall be deemed to
refer to the Prospectus (including the documents incorporated by reference
therein) as defined in the Underwriting
3
<PAGE> 39
Draft of October 13, 1994
Agreement as of the date of the letter delivered on the date of the
Pricing Agreement for purposes of such letter and to the Prospectus as amended
or supplemented (including the documents incorporated by reference therein) in
relation to the applicable Designated Securities for purposes of the letter
delivered at the Time of Delivery for such Designated Securities.
4
<PAGE> 1
(WLRK Draft -- 10/13/94)
EXHIBIT 4.1
TRANSAMERICA CORPORATION
AND
THE FIRST NATIONAL BANK OF CHICAGO,
AS TRUSTEE
-------------
INDENTURE
Dated as of ______________ __, 1994
------------
Junior Subordinated Debentures
<PAGE> 2
CROSS-REFERENCE TABLE
Section of
Trust Indenture Act Section of
of 1939, as amended Indenture
- ------------------- ----------
310(a)........................................ 7.09
310(b)........................................ 7.08
7.10
310(c)........................................ Inapplicable
311(a)........................................ 7.13(a)
311(b)........................................ 7.13(b)
311(c)........................................ Inapplicable
312(a)........................................ 5.01
5.02(a)
312(b)........................................ 5.02(b)
312(c)........................................ 5.02(c)
313(a)........................................ 5.04(a)
313(b)........................................ 5.04(b)
313(c)........................................ 5.04(a)
5.04(b)
313(d)........................................ 5.04(c)
314(a)........................................ 5.03
314(b)........................................ Inapplicable
314(c)........................................ 13.06
314(d)........................................ Inapplicable
314(e)........................................ 13.06
314(f)........................................ Inapplicable
315(a)........................................ 7.01(a)
7.02
315(b)........................................ 6.07
315(c)........................................ 7.01
315(d)........................................ 7.01(b)
7.01(c)
315(e)........................................ 6.08
316(a)........................................ 6.06
8.04
316(b)........................................ 6.04
316(c)........................................ 8.01
317(a)........................................ 6.02
317(b)........................................ 4.04
318(a)........................................ 13.08
<PAGE> 3
TABLE OF CONTENTS*
Page
----
PARTIES.................................................. 1
RECITALS:
Purpose of Indenture..................................... 1
Compliance with legal requirements....................... 1
Purpose of and consideration for Indenture............... 1
ARTICLE ONE
DEFINITIONS
SECTION 1.01. Certain terms defined; other terms
defined in the Trust Indenture Act
of 1939, as amended, or by refer-
ence therein in the Securities Act
of 1933, as amended, to have the
meanings assigned therein................. 2
Authenticating Agent...................... 2
Board of Directors........................ 2
Board Resolution.......................... 3
Business day.............................. 3
Certificate............................... 3
Corporate Trust Office.................... 3
Company................................... 3
Debenture or Debentures................... 3
Debentureholder........................... 3
Default................................... 3
Depository................................ 4
Event of Default.......................... 4
Global Debenture.......................... 4
Governmental Obligations.................. 4
Guarantee................................. 5
Indenture................................. 5
Interest Payment Date..................... 5
Limited Partnership Agreement............. 5
Officers' Certificate..................... 5
Opinion of Counsel........................ 5
Outstanding............................... 6
Predecessor Debenture..................... 6
Responsible Officer....................... 7
Senior Indebtedness....................... 7
Subsidiary................................ 7
Transamerica Delaware..................... 7
Trustee................................... 7
Trust Indenture Act....................... 8
- -----------------
* This Table of Contents does not constitute part of the
Indenture and should not have any bearing upon the inter-
pretation of any of its terms or provisions.
-i-
<PAGE> 4
ARTICLE TWO
ISSUE, DESCRIPTION, TERMS, EXECUTION, REGISTRATION
AND EXCHANGE OF DEBENTURES
SECTION 2.01. Designation, terms, amount, authen-
tication and delivery of Debentures....... 8
SECTION 2.02. Form of Debentures and Trustee's
certificate............................... 10
SECTION 2.03. Date and denominations of Debentures,
and provisions for payment of prin-
cipal, premium and interest............... 10
SECTION 2.04. Execution of Debentures................... 12
SECTION 2.05. Exchange of Debentures.................... 13
(a) Registration and transfer of
Debentures........................... 13
(b) Debentures to be accompanied by
proper instruments of transfer....... 14
(c) Charges upon exchange, transfer
or registration of Debentures........ 14
(d) Restrictions on transfer or
exchange at time of redemption....... 14
SECTION 2.06. Temporary Debentures...................... 15
SECTION 2.07. Mutilated, destroyed, lost or stolen
Debentures................................ 15
SECTION 2.08. Cancellation of surrendered Debentures.... 16
SECTION 2.09. Provisions of Indenture and Debentures
for sole benefit of parties and Deben-
tureholders............................... 17
SECTION 2.10. Appointment of Authenticating Agent....... 17
SECTION 2.11. Global Debenture.......................... 18
(a) Authentication and Delivery;
Legend............................... 18
(b) Transfer of Global Debenture......... 18
(c) Issuance of Debentures in
definitive form...................... 18
-ii-
<PAGE> 5
ARTICLE THREE
REDEMPTION OF DEBENTURES AND SINKING FUND PROVISIONS
SECTION 3.01. Redemption of Debentures.................. 19
SECTION 3.02. (a) Notice of redemption................. 19
(b) Selection of Debentures in case
less than all Debentures to be
redeemed............................. 20
SECTION 3.03. (a) When Debentures called for
redemption become due and
payable.............................. 21
(b) Receipt of new Debenture upon
partial payment...................... 21
SECTION 3.04. Sinking Fund for Debentures............... 21
SECTION 3.05. Satisfaction of Sinking Fund Payments
with Debentures........................... 22
SECTION 3.06. Redemption of Debentures for Sinking
Fund...................................... 22
ARTICLE FOUR
PARTICULAR COVENANTS OF THE COMPANY
SECTION 4.01. Payment of principal of (and premium,
if any) and interest on Debentures........ 22
SECTION 4.02. Maintenance of office or agency for
payment of Debentures, designation
of office or agency for payment,
registration, transfer and exchange
of Debentures............................. 23
SECTION 4.03. (a) Duties of paying agent............... 23
(b) Company as paying agent.............. 24
(c) Holding sums in trust................ 24
SECTION 4.04. Appointment to fill vacancy in
office of Trustee......................... 24
SECTION 4.05. Restriction on consolidation,
merger or sale............................ 24
SECTION 4.06. Covenants as to Transamerica Delaware..... 24
SECTION 4.07. Restriction on dividends and payments..... 25
-iii-
<PAGE> 6
ARTICLE FIVE
DEBENTUREHOLDERS' LISTS AND REPORTS BY THE COMPANY
AND THE TRUSTEE
SECTION 5.01. Company to furnish Trustee informa-
tion as to names and addresses of
Debentureholders.......................... 25
SECTION 5.02. (a) Trustee to preserve information
as to names and addresses of
Debentureholders received by it
in capacity of paying agent.......... 26
(b) Trustee may destroy list of
Debentureholders on certain
conditions........................... 26
(c) Trustee to make information
as to names and addresses of
Debentureholders available
to "applicants" or mail com-
munications to Debenturehold-
ers in certain circumstances......... 26
(d) Procedure if Trustee elects
not to make information
available to applicants.............. 26
(e) Company and Trustee not
accountable for disclosure
of information....................... 27
SECTION 5.03. (a) Annual and other reports to
be filed by Company with
Trustee.............................. 27
(b) Additional information and
reports to be filed with
Trustee and Securities and
Exchange Commission.................. 28
(c) Summaries of information and
reports to be transmitted by
Company to Debentureholders.......... 28
(d) Annual Certificate to be fur-
nished to Trustee.................... 28
SECTION 5.04. (a) Trustee to transmit annual
report to Debentureholders........... 28
(b) Trustee to transmit certain
further reports to Debenture-
holders.............................. 29
-iv-
<PAGE> 7
(c) Copies of reports to be filed
with stock exchanges and Secu-
rities and Exchange Commission....... 30
ARTICLE SIX
REMEDIES OF THE TRUSTEE AND DEBENTUREHOLDERS
ON EVENT OF DEFAULT
SECTION 6.01. (a) Events of Default defined............ 30
(b) Acceleration of maturity upon
Event of Default..................... 32
(c) Waiver of default and rescission
of declaration of maturity........... 32
(d) Restoration of former position
and rights upon curing default....... 32
SECTION 6.02. (a) Covenant of Company to pay to
Trustee whole amount due on
Debentures on default in pay-
ment of interest or principal
(and premium, if any)................ 33
(b) Trustee may recover judgment
for whole amount due on Deben-
tures on failure of Company to
pay.................................. 33
(c) Filing of proof of claim by
Trustee in bankruptcy, reorgani-
zation or receivership proceeding.... 33
(d) Rights of action and of assert-
ing claims may be enforced by
Trustee without possession of
Debentures........................... 34
SECTION 6.03. Application of moneys collected by
Trustee................................... 35
SECTION 6.04. Limitation on suits by holders of
of Debentures............................. 35
SECTION 6.05. (a) Remedies cumulative.................. 36
(b) Delay or omission in exercise
of rights not waiver of default...... 36
SECTION 6.06. Rights of holders of majority in
principal amount of Debentures to
direct Trustee and to waive defaults...... 36
-v-
<PAGE> 8
SECTION 6.07. Trustee to give notice of defaults
known to it, but may withhold in
certain circumstances..................... 37
SECTION 6.08. Requirements of an undertaking to
pay costs in certain suits under
Indenture or against Trustee.............. 38
ARTICLE SEVEN
CONCERNING THE TRUSTEE
SECTION 7.01. (a) Upon Event of Default occurring
and continuing, Trustee shall
exercise powers vested in it,
and use same degree of care
and skill in their exercise,
as prudent individual would
use.................................. 38
(b) Trustee not relieved from lia-
bility for negligence or willful
misconduct except as provided in
this section......................... 39
(1) Prior to Event of Default
and after the curing of
all Events of Default which
may have occurred............... 39
(i) Trustee not liable
except for performance
of duties specifically
set forth.................. 39
(ii) In absence of bad faith,
Trustee may conclusively
rely on certificates or
opinions furnished it
hereunder, subject to
duty to examine the same
if specifically required
to be furnished to it...... 39
(2) Trustee not liable for error
of judgment made in good
faith by Responsible Officer
unless Trustee negligent........ 39
(3) Trustee not liable for action
or non-action in accordance
with direction of holders of
majority in principal amount
of Debentures................... 39
-vi-
<PAGE> 9
(4) Trustee need not expend own
funds without adequate in-
demnity......................... 40
SECTION 7.02. Subject to provisions of Section 7.01:
(a) Trustee may rely on documents
believed genuine and properly
signed or presented.................. 40
(b) Sufficient evidence by certain
instruments provided for............. 40
(c) Trustee may consult with counsel
and act on advice or Opinion of
Counsel.............................. 40
(d) Trustee may require indemnity
from Debentureholders................ 40
(e) Trustee not liable for actions
in good faith believed to be
authorized........................... 41
(f) Prior to Event of Default, Trustee
not bound to investigate facts or
matters stated in certificates,
etc., unless requested in writing
by Debentureholders.................. 41
(g) Trustee may perform duties directly
or through agents or attorneys....... 41
SECTION 7.03. (a) Trustee not liable for recitals
in Indenture or in Debentures........ 41
(b) No representations by Trustee as
to validity or Indenture or of
Debentures........................... 41
(c) Trustee not accountable for use
of Debentures or proceeds............ 41
SECTION 7.04. Trustee, paying agent or Debenture
Registrar may own Debentures.............. 42
SECTION 7.05. Moneys received by Trustee to be held
in trust without interest................. 42
SECTION 7.06. (a) Trustee entitled to compensation,
reimbursement and indemnity.......... 42
(b) Obligations to Trustee to be
secured by lien prior to Deben-
tures................................ 42
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SECTION 7.07. Right of Trustee to rely on certifi-
cate of officers of Company where no
other evidence specifically prescribed.... 43
SECTION 7.08. (a) Trustee acquiring conflicting
interest to eliminate conflict
or resign............................ 43
(b) Notice to Debentureholders in
case of failure to comply with
subsection (a)....................... 43
(c) Definition of conflicting
interest............................. 43
(d) Definition of certain terms.......... 47
(e) Calculation of percentages of
Debentures........................... 48
(f) Trustee resignation not required
under certain circumstances.......... 50
SECTION 7.09. Requirements for eligibility of
Trustee................................... 50
SECTION 7.10. (a) Resignation of Trustee and
appointment of successor............. 51
(b) Removal of Trustee by Company
or by court on Debentureholders'
application.......................... 51
(c) Removal of Trustee by holders
of majority in principal amount
of Debentures........................ 52
(d) Time when resignation or removal
of Trustee effective................. 52
(e) One Trustee for each series.......... 52
SECTION 7.11. (a) Acceptance by successor to
Trustee.............................. 52
(b) Trustee with respect to less
than all series...................... 52
(c) Company to confirm Trustee's
rights............................... 53
(d) Successor Trustee to be qualified.... 53
(e) Notice of succession................. 54
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<PAGE> 11
SECTION 7.12. Successor to Trustee by merger, con-
solidation or succession to business...... 54
SECTION 7.13. (a) Limitations on rights of Trustee
as a creditor to obtain payment
of certain claims within four
months prior to default or dur-
ing default, or to realize on
property as such creditor there-
after................................ 54
(b) Certain creditor relationships
excluded............................. 57
(c) Definition of certain terms.......... 58
ARTICLE EIGHT
CONCERNING THE DEBENTUREHOLDERS
SECTION 8.01. Evidence of action by Debenture-
holders................................... 59
SECTION 8.02. Proof of execution of instruments
and of holding of Debentures.............. 59
SECTION 8.03. Who may be deemed owners of
Debentures................................ 60
SECTION 8.04. Debentures owned by Company or
controlled or controlling companies
disregarded for certain purposes.......... 60
SECTION 8.05. Instruments executed by Debenture-
holders bind future holders............... 61
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 9.01. Purposes for which supplemental
indenture may be entered into with-
out consent of Debentureholders........... 61
SECTION 9.02. Modification of Indenture with
consent of Debentureholders............... 63
SECTION 9.03. Effect of supplemental indentures......... 64
SECTION 9.04. Debentures may bear notation of
changes by supplemental indentures........ 64
SECTION 9.05. Opinion of Counsel........................ 64
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<PAGE> 12
ARTICLE TEN
CONSOLIDATION, MERGER AND SALE
SECTION 10.01. Consolidations or mergers of Company
and sales or conveyances of property
of Company permitted...................... 64
SECTION 10.02. (a) Rights and duties of successor
company.............................. 65
(b) Appropriate changes may be
made in phraseology and form
of Debentures........................ 66
(c) Company may consolidate or
merge into itself or acquire
properties of other corpora-
tions................................ 66
SECTION 10.03. Opinion of Counsel........................ 66
ARTICLE ELEVEN
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 11.01. Satisfaction and discharge of
Indenture................................. 66
SECTION 11.02. Discharge of Company's Obligations........ 67
SECTION 11.03. Application by Trustee of funds
deposited for payment of Debentures....... 67
SECTION 11.04. Repayment of moneys held by paying
agent..................................... 67
SECTION 11.05. Repayment of moneys held by Trustee....... 68
ARTICLE TWELVE
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
SECTION 12.01. Incorporators, stockholders, officers
and directors of Company exempt from
individual liability...................... 68
ARTICLE THIRTEEN
MISCELLANEOUS PROVISIONS
SECTION 13.01. Successors and assigns of Company
bound by Indenture........................ 69
SECTION 13.02. Acts of board, committee or officer
of successor company valid................ 69
SECTION 13.03. Surrender of powers by Company............ 69
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<PAGE> 13
SECTION 13.04. Required notices or demands may be
served by mail............................ 69
SECTION 13.05. Indenture and Debentures to be con-
strued in accordance with laws of
the State of New York..................... 69
SECTION 13.06. (a) Officers' Certificate and
Opinion of Counsel to be fur-
nished upon applications or
demands by Company................... 70
(b) Statements to be included in
each certificate or opinion with
respect to compliance with condi-
tion or covenant..................... 70
SECTION 13.07. Payments due on Sundays or holidays....... 70
SECTION 13.08. Provisions required by Trust Inden-
ture Act of 1939 to control............... 70
SECTION 13.09. Indenture may be executed in coun-
terparts.................................. 70
SECTION 13.10. Separability of Indenture provisions...... 71
SECTION 13.11. Assignment by Company to subsidiary....... 71
ARTICLE FOURTEEN
SUBORDINATION OF DEBENTURES
SECTION 14.01. Agreement of Subordination................ 71
SECTION 14.02. Limitations on payments to Deben-
tureholders............................... 71
SECTION 14.03. Payments in bankruptcy.................... 72
SECTION 14.04. Subrogation of Debentures................. 74
SECTION 14.05. Authorization by Debentureholders......... 75
SECTION 14.06. Notice to Trustee......................... 75
SECTION 14.07. Trustee's relation to Senior
Indebtedness.............................. 76
SECTION 14.08. Acts of holders of Senior
Indebtedness.............................. 76
ACCEPTANCE OF TRUST BY TRUSTEE........................... 77
TESTIMONIUM.............................................. 78
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<PAGE> 14
SIGNATURES AND SEALS..................................... 78
ACKNOWLEDGMENTS.......................................... 79
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<PAGE> 15
THIS INDENTURE, dated as of the_______day of__________,
1994, between Transamerica Corporation, a corporation duly
organized and existing under the laws of the State of Delaware
(hereinafter sometimes referred to as the "Company"), and The
First National Bank of Chicago, a national banking association
as trustee (hereinafter sometimes referred to as the "Trust-
ee"):
WHEREAS, for its lawful corporate purposes, the Com-
pany has duly authorized the execution and delivery of this
Indenture to provide for the issuance of unsecured debentures
(hereinafter referred to as the "Debentures"), in an unlimited
aggregate principal amount to be issued from time to time in
one or more series as in this Indenture provided, as registered
Debentures without coupons, to be authenticated by the certifi-
cate of the Trustee;
WHEREAS, to provide the terms and conditions upon
which the Debentures are to be authenticated, issued and deliv-
ered, the Company has duly authorized the execution of this
Indenture;
WHEREAS, the Debentures and the certificate of
authentication to be borne by the Debentures (the "Certificate
of Authentication") are to be substantially in such forms as
may be approved by the Board of Directors (as defined below) or
set forth in any indenture supplemental to this Indenture;
AND WHEREAS, all acts and things necessary to make
the Debentures issued pursuant hereto, when executed by the
Company and authenticated and delivered by the Trustee as in
this Indenture provided, the valid, binding and legal obliga-
tions of the Company, and to constitute these presents a valid
indenture and agreement according to its terms, have been done
and performed or will be done and performed prior to the issu-
ance of such Debentures, and the execution of this Indenture
has been and the issuance hereunder of the Debentures has been
or will be prior to issuance in all respects duly authorized,
and the Company, in the exercise of the legal right and power
in it vested, executes this Indenture and proposes to make,
execute, issue and deliver the Debentures;
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
That in order to declare the terms and conditions
upon which the Debentures are and are to be authenticated,
issued and delivered, and in consideration of the premises, of
the purchase and acceptance of the Debentures by the holders
thereof and of the sum of one dollar ($1.00) to it duly paid by
the Trustee at the execution of these presents, the receipt
<PAGE> 16
whereof is hereby acknowledged, the Company covenants and
agrees with the Trustee, for the equal and proportionate ben-
efit (subject to the provisions of this Indenture) of the
respective holders from time to time of the Debentures, without
any discrimination, preference or priority of any one Debenture
over any other by reason of priority in the time of issue, sale
or negotiation thereof, or otherwise, except as provided here-
in, as follows:
ARTICLE ONE
Definitions
SECTION 1.01. The terms defined in this Section
(except as in this Indenture otherwise expressly provided or
unless the context otherwise requires) for all purposes of this
Indenture, any resolution of the Board of Directors of the Com-
pany and of any indenture supplemental hereto shall have the
respective meanings specified in this Section. All other terms
used in this Indenture which are defined in the Trust Indenture
Act of 1939, as amended, or which are by reference in such Act
defined in the Securities Act of 1933, as amended (except as
herein otherwise expressly provided or unless the context oth-
erwise requires), shall have the meanings assigned to such
terms in said Trust Indenture Act and in said Securities Act as
in force at the date of the execution of this instrument.
Authenticating Agent:
The term "Authenticating Agent" means an authenticating agent
with respect to all or any of the series of Debentures, as the
case may be, appointed with respect to all or any series of the
Debentures, as the case may be, by the Trustee pursuant to Sec-
tion 2.10.
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<PAGE> 17
Board of Directors:
The term "Board of Directors" shall mean the Board of Directors
of the Company, or an Executive or Special Committee of such
Board.
Board Resolution:
The term "Board Resolution" shall mean a copy of a resolution
certified by the Secretary or an Assistant Secretary of the
Company to have been duly adopted by the Board of Directors and
to be in full force and effect on the date of such certifica-
tion.
Business day:
The term "business day", with respect to any series of Deben-
tures, shall mean any day other than a day on which banking
institutions in the Borough of Manhattan, the City and State of
New York, are authorized or obligated by law or executive order
to close.
Certificate:
The term "Certificate" shall mean a certificate signed by the
principal executive officer, the principal financial officer or
the principal accounting officer of the Company. The Certifi-
cate need not comply with the provisions of Section 13.06.
Corporate Trust Office:
The term "Corporate Trust Office" shall mean the office of the
Trustee at which at any particular time its corporate trust
business shall be principally administered, which office at the
date of the execution of this Indenture is located at One First
National Plaza, Suite 0126, Chicago, Illinois 60670-0126,
Attention: Corporate Trust Services Division.
Company:
The term "Company" shall mean Transamerica Corporation, a cor-
poration duly organized and existing under the laws of the
State of Delaware, and, subject to the provisions of Article
Ten, shall also include its successors and assigns.
Debenture or Debentures:
The term "Debenture" or "Debentures" shall mean any Debenture
or Debentures, as the case may be, authenticated and delivered
under this Indenture.
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<PAGE> 18
Debentureholder:
The term "Debentureholder", "holder of Debentures", "registered
holder", or other similar term, shall mean the person or per-
sons in whose name or names a particular Debenture shall be
registered on the books of the Company kept for that purpose in
accordance with the terms of this Indenture.
Default:
The term "Default" shall mean any event, act or condition which
with notice or lapse of time, or both, would constitute an
Event of Default.
Depository:
The term "Depository" shall mean, with respect to Debentures of
any series, for which the Company shall determine that such
Debentures will be issued as a Global Debenture, The Depository
Trust Company, New York, New York, another clearing agency, or
any successor registered as a clearing agency under the Securi-
ties Exchange Act of 1934, as amended (the "Exchange Act"),
or other applicable statute or regulation, which, in each case,
shall be designated by the Company pursuant to either Section
2.01 or 2.11.
Event of Default:
The term "Event of Default" with respect to Debentures of a
particular series shall mean any event specified in Section
6.01, continued for the period of time, if any, therein desig-
nated.
Global Debenture:
The term "Global Debenture" shall mean, with respect to any
series of Debentures, a Debenture executed by the Company and
delivered by the Trustee to the Depository or pursuant to the
Depository's instruction, all in accordance with the Indenture,
which shall be registered in the name of the Depository or its
nominee.
Governmental Obligations:
The term, "Governmental Obligations" shall mean securities that
are (i) direct obligations of the United States of America for
the payment of which its full faith and credit is pledged or
(ii) obligations of a person controlled or supervised by and
acting as an agency or instrumentality of the United States of
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<PAGE> 19
America, the payment of which is unconditionally guaranteed as
a full faith and credit obligation by the United States of
America, which, in either case, are not callable or redeemable
at the option of the issuer thereof, and shall also include a
depository receipt issued by a bank (as defined in Section
3(a)(2) of the Securities Act of 1933, as amended) as custodian
with respect to any such Governmental Obligation or a specific
payment of principal of or interest on any such Governmental
Obligation held by such custodian for the account of the holder
of such depository receipt; provided that (except as required
by law) such custodian is not authorized to make any deduction
from the amount payable to the holder of such depository re-
ceipt from any amount received by the custodian in respect of
the Governmental Obligation or the specific payment of princi-
pal of or interest on the Governmental Obligation evidenced by
such depository receipt.
Guarantee:
The term "Guarantee" shall mean any guarantee that the Company
may enter into with Transamerica Delaware or other persons that
operate directly or indirectly for the benefit of holders of
limited partnership interests issued by Transamerica Delaware.
Indenture:
The term "Indenture" shall mean this instrument as originally
executed, or, if amended or supplemented as herein provided, as
so amended or supplemented.
Interest Payment Date:
The term "Interest Payment Date" when used with respect to any
installment of interest on a Debenture of a particular series
shall mean the date specified in such Debenture or in a Board
Resolution or in an indenture supplemental hereto with respect
to such series as the fixed date on which an installment of
interest with respect to Debentures of that series is due and
payable.
Limited Partnership Agreement:
The term "Limited Partnership Agreement" shall mean the Amended
and Restated Limited Partnership Agreement, dated _____________,
of Transamerica Delaware.
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<PAGE> 20
Officers' Certificate:
The term "Officers' Certificate" shall mean a certificate
signed by the President or a Vice President and by the Trea-
surer or an Assistant Treasurer or the Controller or an Assis-
tant Controller or the Secretary or an Assistant Secretary of
the Company. Each such certificate shall include the state-
ments provided for in Section 13.06, if and to the extent re-
quired by the provisions thereof.
Opinion of Counsel:
The term "Opinion of Counsel" shall mean an opinion in writing
signed by legal counsel, who may be an employee of or counsel
for the Company. Each such opinion shall include the state-
ments provided for in Section 13.06, if and to the extent re-
quired by the provisions thereof.
Outstanding:
The term "outstanding", when used with reference to Debentures
of any series, shall, subject to the provisions of Section
8.04, mean, as of any particular time, all Debentures of that
series theretofore authenticated and delivered by the Trustee
under this Indenture, except (a) Debentures theretofore can-
celed by the Trustee or any paying agent, or delivered to the
Trustee or any paying agent for cancellation or which have pre-
viously been canceled; (b) Debentures or portions thereof for
the payment or redemption of which moneys or Governmental Obli-
gations in the necessary amount shall have been deposited in
trust with the Trustee or with any paying agent (other than the
Company) or shall have been set aside and segregated in trust
by the Company (if the Company shall act as its own paying
agent); provided, however, that if such Debentures or portions
of such Debentures are to be redeemed prior to the maturity
thereof, notice of such redemption shall have been given as in
Article Three provided, or provision satisfactory to the
Trustee shall have been made for giving such notice; and (c)
Debentures in lieu of or in substitution for which other Deben-
tures shall have been authenticated and delivered pursuant to
the terms of Section 2.07.
Predecessor Debenture:
The term "Predecessor Debenture" of any particular Debenture
shall mean every previous Debenture evidencing all or a portion
of the same debt as that evidenced by such particular Deben-
ture; and, for the purposes of this definition, any Debenture
authenticated and delivered under Section 2.07 in lieu of a
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<PAGE> 21
lost, destroyed or stolen Debenture shall be deemed to evidence
the same debt as the lost, destroyed or stolen Debenture.
Responsible Officer:
The term "Responsible Officer" when used with respect to the
Trustee shall mean the chairman of the board of directors, the
president, any vice president, the secretary, the treasurer,
any trust officer, any corporate trust officer or any other
officer or assistant officer of the Trustee customarily per-
forming functions similar to those performed by the persons who
at the time shall be such officers, respectively, or to whom
any corporate trust matter is referred because of his or her
knowledge of and familiarity with the particular subject.
Senior Indebtedness:
The term "Senior Indebtedness" of the Company shall mean the
principal of, premium, if any, interest on and any other pay-
ment due pursuant to any of the following, whether outstanding
at the date of execution of this Indenture or thereafter in-
curred, created or assumed: (a) all indebtedness of the Com-
pany evidenced by notes, debentures, bonds or other securities
sold by the Company for money, (b) all indebtedness of others
of the kinds described in the preceding clause (a) assumed by
or guaranteed in any manner by the Company or in effect guaran-
teed by the Company through an agreement to purchase, contin-
gent or otherwise, and (c) all renewals, extensions or refund-
ings of indebtedness of the kinds described in any of the pre-
ceding clauses (a) and (b) unless, in the case of any particu-
lar indebtedness, renewal, extension or refunding, the instru-
ment creating or evidencing the same or the assumption or guar-
antee 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 Debentures.
Subsidiary:
The term "Subsidiary" shall mean any corporation at least a
majority of whose outstanding voting stock shall at the time be
owned by the Company or by one or more Subsidiaries or by the
Company and one or more Subsidiaries. For the purposes only of
this definition of the term "Subsidiary", the term "voting
stock", as applied to the stock of any corporation, shall mean
stock of any class or classes having ordinary voting power for
the election of a majority of the directors of such corpora-
tion, other than stock having such power only by reason of the
occurrence of a contingency.
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<PAGE> 22
Transamerica Delaware:
The term "Transamerica Delaware" shall mean Transamerica Dela-
ware, L.P., a Delaware limited partnership.
Trustee:
The term "Trustee" shall mean The First National Bank of
Chicago and, subject to the provisions of Article Seven, shall
also include its successors and assigns, and, if at any time
there is more than one person acting in such capacity here-
under, "Trustee" shall mean each such person. The term
"Trustee" as used with respect to a particular series of the
Debentures shall mean the trustee with respect to that series.
Trust Indenture Act:
The term "Trust Indenture Act", subject to the provisions of
Sections 9.01, 9.02, and 10.01, shall mean the Trust Indenture
Act of 1939, as amended and in effect at the date of execution
of this Indenture.
ARTICLE TWO
Issue, Description, Terms, Execution,
Registration and Exchange of Debentures
SECTION 2.01. The aggregate principal amount of
Debentures which may be authenticated and delivered under this
Indenture is unlimited.
The Debentures may be issued in one or more series up
to the aggregate principal amount of Debentures of that series
from time to time authorized by or pursuant to a Board Resolu-
tion or pursuant to one or more indentures supplemental hereto,
prior to the initial issuance of Debentures of a particular
series. Prior to the initial issuance of Debentures of any
series, there shall be established in or pursuant to a Board
Resolution, and set forth in an Officers' Certificate, or
established in one or more indentures supplemental hereto:
(1) the title of the Debentures of the series (which
shall distinguish the Debentures of the series from all
other Debentures);
(2) any limit upon the aggregate principal amount of
the Debentures of that series which may be authenticated
and delivered under this Indenture (except for Debentures
authenticated and delivered upon registration of transfer
-8-
<PAGE> 23
of, or in exchange for, or in lieu of, other Debentures of
that series);
(3) the date or dates on which the principal of the
Debentures of the series is payable;
(4) the rate or rates at which the Debentures of the
series shall bear interest or the manner of calculation of
such rate or rates, if any;
(5) 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 date for the deter-
mination of holders to whom interest is payable on any
such Interest Payment Dates;
(6) the right, if any, to extend the interest pay-
ment periods and the duration of such extension;
(7) the period or periods within which, the price or
prices at which and the terms and conditions upon which,
Debentures of the series may be redeemed, in whole or in
part, at the option of the Company;
(8) the obligation, if any, of the Company to redeem
or purchase Debentures of the series pursuant to any sink-
ing fund or analogous provisions (including payments made
in cash in anticipation of future sinking fund obliga-
tions) or at the option of a holder thereof and the period
or periods within which, the price or prices at which, and
the terms and conditions upon which, Debentures of the
series shall be redeemed or purchased, in whole or in
part, pursuant to such obligation;
(9) the form of the Debentures of the series includ-
ing the form of the Certificate of Authentication for such
series;
(10) if other than denominations of $25 or any inte-
gral multiple thereof, the denominations in which the
Debentures of the series shall be issuable;
(11) any and all other terms with respect to such
series (which terms shall not be inconsistent with the
terms of this Indenture); and
(12) whether the Debentures are issuable as a Global
Debenture and, in such case, the identity the Deposi-
tory for such series.
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<PAGE> 24
All Debentures of any one series shall be substan-
tially identical except as to denomination and except as may
otherwise be provided in or pursuant to any such Board Resolu-
tion or in any indentures supplemental hereto.
If any of the terms of the series are established by
action taken pursuant to a Board Resolution, a copy of an ap-
propriate record of such action shall be certified by the Sec-
retary or an Assistant Secretary of the Company and delivered
to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
SECTION 2.02. The Debentures of any series and the
Trustee's certificate of authentication to be borne by such
Debentures shall be substantially of the tenor and purport as
set forth in one or more indentures supplemental hereto or as
provided in a Board Resolution and as set forth in an Officers'
Certificate, and may have such letters, numbers or other marks
of identification or designation and such legends or endorse-
ments printed, lithographed or engraved thereon as the Company
may deem appropriate and as are not inconsistent with the pro-
visions of this Indenture, or as may be required to comply with
any law or with any rule or regulation made pursuant thereto or
with any rule or regulation of any stock exchange on which
Debentures of that series may be listed, or to conform to
usage.
SECTION 2.03. The Debentures shall be issuable as
registered Debentures and in the denominations of $25 or any
integral multiple thereof, subject to Section 2.01(10). The
Debentures of a particular series shall bear interest payable
on the dates and at the rate specified with respect to that
series. The principal of and the interest on the Debentures of
any series, as well as any premium thereon in case of redemp-
tion thereof prior to maturity, shall be payable in the coin or
currency of the United States of America which at the time is
legal tender for public and private debt, at the office or
agency of the Company maintained for that purpose in the Bor-
ough of Manhattan, the City and State of New York. Each Deben-
ture shall be dated the date of its authentication. Interest on
the Debentures shall be computed on the basis of a 360-day year
composed of twelve 30-day months.
The interest installment on any Debenture which is
payable, and is punctually paid or duly provided for, on any
Interest Payment Date for Debentures of that series shall be
paid to the person in whose name said Debenture (or one or more
Predecessor Debentures) is registered at the close of business
on the regular record date for such interest installment. In
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<PAGE> 25
the event that any Debenture of a particular series or portion
thereof is called for redemption and the redemption date is
subsequent to a regular record date with respect to any Inter-
est Payment Date and prior to such Interest Payment Date,
interest on such Debenture will be paid upon presentation and
surrender of such Debenture as provided in Section 3.03.
Any interest on any Debenture which is payable, but
is not punctually paid or duly provided for, on any Interest
Payment Date for Debentures of the same series (herein called
"Defaulted Interest") shall forthwith cease to be payable to
the registered holder on the relevant regular record date by
virtue of having been such holder; and such Defaulted Interest
shall be paid by the Company, at its election, as provided in
clause (1) or clause (2) below:
(1) The Company may make payment of any Defaulted
Interest on Debentures to the persons in whose names such
Debentures (or their respective Predecessor Debentures)
are registered at the close of business on a special
record date for the payment of such Defaulted Interest,
which shall be fixed in the following manner: the Company
shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each such Deben-
ture and the date of the proposed payment, and at the same
time the Company shall deposit with the Trustee an amount
of money equal to the aggregate amount proposed to be paid
in respect of such Defaulted Interest or shall make ar-
rangements satisfactory to the Trustee for such deposit
prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the per-
sons entitled to such Defaulted Interest as in this clause
provided. Thereupon the Trustee shall fix a special
record date for the payment of such Defaulted Interest
which shall not be more than 15 nor less than 10 days
prior to the date of the proposed payment and not less
than 10 days after the receipt by the Trustee of the
notice of the proposed payment. The Trustee shall prompt-
ly notify the Company of such special record date and, in
the name and at the expense of the Company, shall cause
notice of the proposed payment of such Defaulted Interest
and the special record date therefor to be mailed, first
class postage prepaid, to each Debentureholder at his or
her address as it appears in the Debenture Register (as
hereinafter defined), not less than 10 days prior to such
special record date. Notice of the proposed payment of
such Defaulted Interest and the special record date there-
for having been mailed as aforesaid, such Defaulted Inter-
est shall be paid to the persons in whose names such
Debentures (or their respective Predecessor Debentures)
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<PAGE> 26
are registered on such special record date and shall be no
longer payable pursuant to the following clause (2).
(2) The Company may make payment of any Defaulted
Interest on any Debentures in any other lawful manner not
inconsistent with the requirements of any securities ex-
change on which such Debentures may be listed, and upon
such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed
payment pursuant to this clause, such manner of payment
shall be deemed practicable by the Trustee.
Unless otherwise set forth in a Board Resolution or
one or more indentures supplemental hereto establishing the
terms of any series of Debentures pursuant to Section 2.01
hereof, the term "regular record date" as used in this Section
with respect to a series of Debentures with respect to any In-
terest Payment Date for such series shall mean either the fif-
teenth day of the month immediately preceding the month in
which an Interest Payment Date established for such series pur-
suant to Section 2.01 hereof shall occur, if such Interest Pay-
ment Date is the first day of a month, or the last day of the
month immediately preceding the month in which an Interest Pay-
ment Date established for such series pursuant to Section 2.01
hereof shall occur, if such Interest Payment Date is the fif-
teenth day of a month, whether or not such date is a business
day.
Subject to the foregoing provisions of this Section,
each Debenture of a series delivered under this Indenture upon
transfer of or in exchange for or in lieu of any other Deben-
ture of such series shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other
Debenture.
SECTION 2.04. The Debentures shall, subject to the
provisions of Section 2.06, be printed on steel engraved bor-
ders or fully or partially engraved, or legibly typed, as the
proper officers of the Company may determine, and shall be
signed on behalf of the Company by its President or one of its
Vice Presidents, under its corporate seal attested by its Sec-
retary or one of its Assistant Secretaries. The signature of
the President or a Vice President and/or the signature of the
Secretary or an Assistant Secretary in attestation of the cor-
porate seal, upon the Debentures, may be in the form of a fac-
simile signature of a present or any future President or Vice
President and of a present or any future Secretary or Assistant
Secretary and may be imprinted or otherwise reproduced on the
Debentures and for that purpose the Company may use the fac-
simile signature of any person who shall have been a President
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or Vice President, or of any person who shall have been a Sec-
retary or Assistant Secretary, notwithstanding the fact that at
the time the Debentures shall be authenticated and delivered or
disposed of such person shall have ceased to be the President
or a Vice President, or the Secretary or an Assistant Secre-
tary, of the Company, as the case may be. The seal of the Com-
pany may be in the form of a facsimile of the seal of the Com-
pany and may be impressed, affixed, imprinted or otherwise
reproduced on the Debentures.
Only such Debentures as shall bear thereon a Certifi-
cate of Authentication substantially in the form established
for such Debentures, executed manually by an authorized signa-
tory of the Trustee, or by any Authenticating Agent with re-
spect to such Debentures, shall be entitled to the benefits of
this Indenture or be valid or obligatory for any purpose. Such
certificate executed by the Trustee, or by any Authenticating
Agent appointed by the Trustee with respect to such Debentures,
upon any Debenture executed by the Company shall be conclusive
evidence that the Debenture so authenticated has been duly
authenticated and delivered hereunder and that the holder is
entitled to the benefits of this Indenture.
At any time and from time to time after the execution
and delivery of this Indenture, the Company may deliver Deben-
tures of any series executed by the Company to the Trustee for
authentication, together with a written order of the Company
for the authentication and delivery of such Debentures, signed
by its President or any Vice President and its Treasurer or any
Assistant Treasurer, and the Trustee in accordance with such
written order shall authenticate and deliver such Debentures.
In authenticating such Debentures and accepting the
additional responsibilities under this Indenture in relation to
such Debentures, the Trustee shall be entitled to receive, and
(subject to Section 7.01) shall be fully protected in relying
upon, an Opinion of Counsel stating that the form and terms
thereof have been established in conformity with the provisions
of this Indenture.
The Trustee shall not be required to authenticate
such Debentures if the issue of such Debentures pursuant to
this Indenture will affect the Trustee's own rights, duties or
immunities under the Debentures and this Indenture or otherwise
in a manner which is not reasonably acceptable to the Trustee.
SECTION 2.05. (a) Debentures of any series may be
exchanged upon presentation thereof at the office or agency of
the Company designated for such purpose in the Borough of Man-
hattan, the City and State of New York, for other Debentures of
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such series of authorized denominations, and for a like ag-
gregate principal amount, upon payment of a sum sufficient to
cover any tax or other governmental charge in relation thereto,
all as provided in this Section. In respect of any Debentures
so surrendered for exchange, the Company shall execute, the
Trustee shall authenticate and such office or agency shall
deliver in exchange therefor the Debenture or Debentures of the
same series which the Debentureholder making the exchange shall
be entitled to receive, bearing numbers not contemporaneously
outstanding.
(b) The Company shall keep, or cause to be kept, at
its office or agency designated for such purpose in the Borough
of Manhattan, the City and State of New York, or such other
location designated by the Company a register or registers
(herein referred to as the "Debenture Register") in which, sub-
ject to such reasonable regulations as it may prescribe, the
Company shall register the Debentures and the transfers of
Debentures as in this Article provided and which at all reason-
able times shall be open for inspection by the Trustee. The
registrar for the purpose of registering Debentures and trans-
fer of Debentures as herein provided shall be appointed as
authorized by Board Resolution (the "Debenture Registrar").
Upon surrender for transfer of any Debenture at the
office or agency of the Company designated for such purpose in
the Borough of Manhattan, the City and State of New York, the
Company shall execute, the Trustee shall authenticate and such
office or agency shall deliver in the name of the transferee or
transferees a new Debenture or Debentures of the same series as
the Debenture presented for a like aggregate principal amount.
All Debentures presented or surrendered for exchange
or registration of transfer, as provided in this Section, shall
be accompanied (if so required by the Company or the Debenture
Registrar) by a written instrument or instruments of transfer,
in form satisfactory to the Company or the Debenture Registrar,
duly executed by the registered holder or by his duly autho-
rized attorney in writing.
(c) No service charge shall be made for any exchange
or registration of transfer of Debentures, or issue of new
Debentures in case of partial redemption of any series, but the
Company may require payment of a sum sufficient to cover any
tax or other governmental charge in relation thereto, other
than exchanges pursuant to Section 2.06, the second paragraph
of Section 3.03 and Section 9.04 not involving any transfer.
(d) The Company shall not be required (i) to issue,
exchange or register the transfer of any Debentures during a
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period beginning at the opening of business 15 days before the
day of the mailing of a notice of redemption of less than all
the outstanding Debentures of the same series and ending at the
close of business on the day of such mailing, nor (ii) to reg-
ister the transfer of or exchange any Debentures of any series
or portions thereof called for redemption. The provisions of
this Section 2.05 are, with respect to any Global Debenture,
subject to Section 2.11 hereof.
SECTION 2.06. Pending the preparation of definitive
Debentures of any series, the Company may execute, and the
Trustee shall authenticate and deliver, temporary Debentures
(printed, lithographed or typewritten) of any authorized denom-
ination, and substantially in the form of the definitive Deben-
tures in lieu of which they are issued, but with such omis-
sions, insertions and variations as may be appropriate for tem-
porary Debentures, all as may be determined by the Company.
Every temporary Debenture of any series shall be executed by
the Company and be authenticated by the Trustee upon the same
conditions and in substantially the same manner, and with like
effect, as the definitive Debentures of such series. Without
unnecessary delay the Company will execute and will furnish
definitive Debentures of such series and thereupon any or all
temporary Debentures of such series may be surrendered in ex-
change therefor (without charge to the holders), at the office
or agency of the Company designated for the purpose in the Bor-
ough of Manhattan, the City and State of New York, and the
Trustee shall authenticate and such office or agency shall
deliver in exchange for such temporary Debentures an equal ag-
gregate principal amount of definitive Debentures of such
series, unless the Company advises the Trustee to the effect
that definitive Debentures need not be executed and furnished
until further notice from the Company. Until so exchanged, the
temporary Debentures of such series shall be entitled to the
same benefits under this Indenture as definitive Debentures of
such series authenticated and delivered hereunder.
SECTION 2.07. In case any temporary or definitive
Debenture shall become mutilated or be destroyed, lost or sto-
len, the Company (subject to the next succeeding sentence)
shall execute, and upon its request the Trustee (subject as
aforesaid) shall authenticate and deliver, a new Debenture of
the same series bearing a number not contemporaneously out-
standing, in exchange and substitution for the mutilated Deben-
ture, or in lieu of and in substitution for the Debenture so
destroyed, lost or stolen. In every case the applicant for a
substituted Debenture shall furnish to the Company and to the
Trustee such security or indemnity as may be required by them
to save each of them harmless, and, in every case of destruc-
tion, loss or theft, the applicant shall also furnish to the
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Company and to the Trustee evidence to their satisfaction of
the destruction, loss or theft of the applicant's Debenture and
of the ownership thereof. The Trustee may authenticate any
such substituted Debenture and deliver the same upon the writ-
ten request or authorization of any officer of the Company.
Upon the issuance of any substituted Debenture, the Company may
require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses
of the Trustee) connected therewith. In case any Debenture
which has matured or is about to mature shall become mutilated
or be destroyed, lost or stolen, the Company may, instead of
issuing a substitute Debenture, pay or authorize the payment of
the same (without surrender thereof except in the case of a
mutilated Debenture) if the applicant for such payment shall
furnish to the Company and to the Trustee such security or in-
demnity as they may require to save them harmless, and, in case
of destruction, loss or theft, evidence to the satisfaction of
the Company and the Trustee of the destruction, loss or theft
of such Debenture and of the ownership thereof.
Every Debenture issued pursuant to the provisions of
this Section in substitution for any Debenture which is muti-
lated, destroyed, lost or stolen shall constitute an additional
contractual obligation of the Company, whether or not the muti-
lated, destroyed, lost or stolen Debenture shall be found at
any time, or be enforceable by anyone, and shall be entitled to
all the benefits of this Indenture equally and proportionately
with any and all other Debentures of the same series duly is-
sued hereunder. All Debentures shall be held and owned upon
the express condition that the foregoing provisions are exclu-
sive with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Debentures, and shall preclude (to
the extent lawful) any and all other rights or remedies, not-
withstanding any law or statute existing or hereafter enacted
to the contrary with respect to the replacement or payment of
negotiable instruments or other securities without their sur-
render.
SECTION 2.08. All Debentures surrendered for the
purpose of payment, redemption, exchange or registration of
transfer shall, if surrendered to the Company or any paying
agent, be delivered to the Trustee for cancellation, or, if
surrendered to the Trustee, shall be canceled by it, and no
Debentures shall be issued in lieu thereof except as expressly
required or permitted by any of the provisions of this Inden-
ture. On request of the Company, the Trustee shall deliver to
the Company canceled Debentures held by the Trustee. In the
absence of such request the Trustee may dispose of canceled
Debentures in accordance with its standard procedures and
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deliver a certificate of disposition to the Company. If the
Company shall otherwise acquire any of the Debentures, however,
such acquisition shall not operate as a redemption or satisfac-
tion of the indebtedness represented by such Debentures unless
and until the same are delivered to the Trustee for cancella-
tion.
SECTION 2.09. Nothing in this Indenture or in the
Debentures, express or implied, shall give or be construed to
give to any person, firm or corporation, other than the parties
hereto and the holders of the Debentures (and, with respect to
the provisions of Article XIV, the holders of Senior Indebtedness),
any legal or equitable right, remedy or claim under or in respect
of this Indenture, or under any covenant, condition or provision
herein contained; all such covenants, conditions and provisions
being for the sole benefit of the parties hereto and of the
holders of the Debenture.
SECTION 2.10. So long as any of the Debentures of
any series remain outstanding there may be an Authenticating
Agent for any or all such series of Debentures which the
Trustee shall have the right to appoint. Said Authenticating
Agent shall be authorized to act on behalf of the Trustee to
authenticate Debentures of such series issued upon exchange,
transfer or partial redemption thereof, and Debentures so
authenticated shall be entitled to the benefits of this Inden-
ture and shall be valid and obligatory for all purposes as if
authenticated by the Trustee hereunder. All references in this
Indenture to the authentication of Debentures by the Trustee
shall be deemed to include authentication by an Authenticating
Agent for such series except for authentication upon original
issuance or pursuant to Section 2.07 hereof. Each Authenticat-
ing Agent shall be acceptable to the Company and shall be a
corporation which has a combined capital and surplus, as most
recently reported or determined by it, sufficient under the
laws of any jurisdiction under which it is organized or in
which it is doing business to conduct a trust business, and
which is otherwise authorized under such laws to conduct such
business and is subject to supervision or examination by Fed-
eral or State authorities. If at any time any Authenticating
Agent shall cease to be eligible in accordance with these pro-
visions, it shall resign immediately.
Any Authenticating Agent may at any time resign by
giving written notice of resignation to the Trustee and to the
Company. The Trustee may at any time (and upon request by the
Company shall) terminate the agency of any Authenticating Agent
by giving written notice of termination to such Authenticating
Agent and to the Company. Upon resignation, termination or
cessation of eligibility of any Authenticating Agent, the
Trustee may appoint an eligible successor Authenticating Agent
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acceptable to the Company. Any successor Authenticating Agent,
upon acceptance of its appointment hereunder, shall become
vested with all the rights, powers and duties of its predeces-
sor hereunder as if originally named as an Authenticating Agent
pursuant hereto.
SECTION 2.11. (a) If the Company shall establish
pursuant to Section 2.01 that the Debentures of a particular
series are to be issued as a Global Debenture, then the Company
shall execute and the Trustee shall, in accordance with Section
2.04, authenticate and deliver, a Global Debenture which (i)
shall represent, and shall be denominated in an amount equal to
the aggregate principal amount of, all of the Outstanding
Debentures of such series, (ii) shall be registered in the name
of the Depository or its nominee, (iii) shall be delivered by
the Trustee to the Depository or pursuant to the Depository's
instruction and (iv) shall bear a legend substantially to the
following effect: "Except as otherwise provided in Section
2.11 of the Indenture, this Debenture may be transferred, in
whole but not in part, only to another nominee of the Deposi-
tory or to a successor Depository or to a nominee of such suc-
cessor Depository."
(b) Notwithstanding the provisions of Section 2.05,
the Global Debenture of a series may be transferred, in whole
but not in part and in the manner provided in Section 2.05,
only to another nominee of the Depository for such series, or
to a successor Depository for such series selected or approved
by the Company or to a nominee of such successor Depository.
(c) If at any time the Depository for a series of
Debentures notifies the Company that it is unwilling or unable
to continue as Depository for such series or if at any time the
Depository for such series shall no longer be registered or in
good standing under the Exchange Act, or other applicable stat-
ute or regulation and a successor Depository for such series is
not appointed by the Company within 90 days after the Company
receives such notice or becomes aware of such condition, as the
case may be, this Section 2.11 shall no longer be applicable to
the Debentures of such series and the Company will execute, and
subject to Section 2.05, the Trustee will authenticate and
deliver Debentures of such series in definitive registered form
without coupons, in authorized denominations, and in an aggre-
gate principal amount equal to the principal amount of the Glo-
bal Debenture of such series in exchange for such Global Deben-
ture. In addition, the Company may at any time determine that
the Debentures of any series shall no longer be represented by
a Global Debenture and that the provisions of this Section 2.11
shall no longer apply to the Debentures of such series. In
such event the Company will execute and subject to Section
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2.05, the Trustee, upon receipt of an Officers' Certificate
evidencing such determination by the Company, will authenticate
and deliver Debentures of such series in definitive registered
form without coupons, in authorized denominations, and in an
aggregate principal amount equal to the principal amount of the
Global Debenture of such series in exchange for such Global
Debenture. Upon the exchange of the Global Debenture for such
Debentures in definitive registered form without coupons, in
authorized denominations, the Global Debenture shall be can-
celed by the Trustee. Such Debentures in definitive registered
form issued in exchange for the Global Debenture pursuant to
this Section 2.11(c) shall be registered in such names and in
such authorized denominations as the Depository, pursuant to
instructions from its direct or indirect participants or other-
wise, shall instruct the Trustee. The Trustee shall deliver
such Debentures to the Depository for delivery to the persons
in whose names such Debentures are so registered.
ARTICLE THREE
Redemption of Debentures and Sinking Fund Provisions
SECTION 3.01. The Company may redeem the Debentures
of any series issued hereunder on and after the dates and in
accordance with the terms established for such series pursuant
to Section 2.01 hereof.
SECTION 3.02. (a) In case the Company shall desire
to exercise such right to redeem all or, as the case may be, a
portion of the Debentures of any series in accordance with the
right reserved so to do, it shall give notice of such redemp-
tion to holders of the Debentures of such series to be redeemed
by mailing, first class postage prepaid, a notice of such re-
demption not less than 30 days and not more than 60 days before
the date fixed for redemption of that series to such holders at
their last addresses as they shall appear upon the Debenture
Register. Any notice which is mailed in the manner herein pro-
vided shall be conclusively presumed to have been duly given,
whether or not the registered holder receives the notice. In
any case, failure duly to give such notice to the holder of any
Debenture of any series designated for redemption in whole or
in part, or any defect in the notice, shall not affect the
validity of the proceedings for the redemption of any other
Debentures of such series or any other series. In the case of
any redemption of Debentures prior to the expiration of any
restriction on such redemption provided in the terms of such
Debentures or elsewhere in this Indenture, the Company shall
furnish the Trustee with an Officers' Certificate evidencing
compliance with any such restriction.
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Each such notice of redemption shall specify the date
fixed for redemption and the redemption price at which Deben-
tures of that series are to be redeemed, and shall state that
payment of the redemption price of such Debentures to be re-
deemed will be made at the office or agency of the Company in
the Borough of Manhattan, the City and State of New York, upon
presentation and surrender of such Debentures, that interest
accrued to the date fixed for redemption will be paid as speci-
fied in said notice, that from and after said date interest
will cease to accrue and that the redemption is for a sinking
fund, if such is the case. If less than all the Debentures of
a series are to be redeemed, the notice to the holders of
Debentures of that series to be redeemed in whole or in part
shall specify the particular Debentures to be so redeemed. In
case any Debenture is to be redeemed in part only, the notice
which relates to such Debenture shall state the portion of the
principal amount thereof to be redeemed, and shall state that
on and after the redemption date, upon surrender of such Deben-
ture, a new Debenture or Debentures of such series in principal
amount equal to the unredeemed portion thereof will be issued.
(b) If less than all the Debentures of a series are
to be redeemed, the Company shall give the Trustee at least 45
days' notice in advance of the date fixed for redemption as to
the aggregate principal amount of Debentures of the series to
be redeemed, and thereupon the Trustee shall select, by lot or
in such other manner as it shall deem appropriate and fair in
its discretion and which may provide for the selection of a
portion or portions (equal to $25 or any integral multiple
thereof) of the principal amount of such Debentures of a denom-
ination larger than $25, the Debentures to be redeemed and
shall thereafter promptly notify the Company in writing of the
numbers of the Debentures to be redeemed, in whole or in part.
The Company may, if and whenever it shall so elect,
by delivery of instructions signed on its behalf by its Presi-
dent or any Vice President, instruct the Trustee or any paying
agent to call all or any part of the Debentures of a particular
series for redemption and to give notice of redemption in the
manner set forth in this Section, such notice to be in the name
of the Company or its own name as the Trustee or such paying
agent may deem advisable. In any case in which notice of re-
demption is to be given by the Trustee or any such paying
agent, the Company shall deliver or cause to be delivered to,
or permit to remain with, the Trustee or such paying agent, as
the case may be, such Debenture Register, transfer books or
other records, or suitable copies or extracts therefrom, suf-
ficient to enable the Trustee or such paying agent to give any
notice by mail that may be required under the provisions of
this Section.
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<PAGE> 35
SECTION 3.03. (a) If the giving of notice of re-
demption shall have been completed as above provided, the
Debentures or portions of Debentures of the series to be re-
deemed specified in such notice shall become due and payable on
the date and at the place stated in such notice at the appli-
cable redemption price, together with interest accrued to the
date fixed for redemption and interest on such Debentures or
portions of Debentures shall cease to accrue on and after the
date fixed for redemption, unless the Company shall default in
the payment of such redemption price and accrued interest with
respect to any such Debenture or portion thereof. On presenta-
tion and surrender of such Debentures on or after the date
fixed for redemption at the place of payment specified in the
notice, said Debentures shall be paid and redeemed at the ap-
plicable redemption price for such series, together with inter-
est accrued thereon to the date fixed for redemption (but if
the date fixed for redemption is an interest payment date, the
interest installment payable on such date shall be payable to
the registered holder at the close of business on the appli-
cable record date pursuant to Section 2.03).
(b) Upon presentation of any Debenture of such se-
ries which is to be redeemed in part only, the Company shall
execute and the Trustee shall authenticate and the office or
agency where the Debenture is presented shall deliver to the
holder thereof, at the expense of the Company, a new Debenture
or Debentures of the same series, of authorized denominations
in principal amount equal to the unredeemed portion of the De-
benture so presented.
SECTION 3.04. The provisions of Sections 3.04, 3.05
and 3.06 shall be applicable to any sinking fund for the re-
tirement of Debentures of a series, except as otherwise speci-
fied as contemplated by Section 2.01 for Debentures of such
series.
The minimum amount of any sinking fund payment pro-
vided for by the terms of Debentures of any series is herein
referred to as a "mandatory sinking fund payment", and any pay-
ment in excess of such minimum amount provided for by the terms
of Debentures of any series is herein referred to as an "op-
tional sinking fund payment". If provided for by the terms of
Debentures of any series, the cash amount of any sinking fund
payment may be subject to reduction as provided in Section
3.05. Each sinking fund payment shall be applied to the re-
demption of Debentures of any series as provided for by the
terms of Debentures of such series.
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<PAGE> 36
SECTION 3.05. The Company (i) may deliver Outstand-
ing Debentures of a series (other than any previously called
for redemption) and (ii) may apply as a credit Debentures of a
series which have been redeemed either at the election of the
Company pursuant to the terms of such Debentures or through the
application of permitted optional sinking fund payments pursu-
ant to the terms of such Debentures, in each case in satisfac-
tion of all or any part of any sinking fund payment with re-
spect to the Debentures of such series required to be made pur-
suant to the terms of such Debentures as provided for by the
terms of such series; provided that such Debentures have not
been previously so credited. Such Debentures shall be received
and credited for such purpose by the Trustee at the redemption
price specified in such Debentures for redemption through op-
eration of the sinking fund and the amount of such sinking fund
payment shall be reduced accordingly.
SECTION 3.06. Not less than 45 days prior to each
sinking fund payment date for any series of Debentures, the
Company will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment
for that series pursuant to the terms of that series, the por-
tion thereof, if any, which is to be satisfied by delivering
and crediting Debentures of that series pursuant to Section
3.05 and the basis for such credit and will, together with such
Officers' Certificate, deliver to the Trustee any Debentures to
be so delivered. Not less than 30 days before each such sink-
ing fund payment date the Trustee shall select the Debentures
to be redeemed upon such sinking fund payment date in the man-
ner specified in Section 3.02 and cause notice of the redemp-
tion thereof to be given in the name of and at the expense of
the Company in the manner provided in Section 3.02. Such
notice having been duly given, the redemption of such Deben-
tures shall be made upon the terms and in the manner stated in
Section 3.03.
ARTICLE FOUR
Particular Covenants of the Company
The Company covenants and agrees for each series of
the Debentures as follows:
SECTION 4.01. The Company will duly and punctually
pay or cause to be paid the principal of (and premium, if any)
and interest on the Debentures of that series at the time and
place and in the manner provided herein and established with
respect to such Debentures.
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<PAGE> 37
SECTION 4.02. So long as any series of the Deben-
tures remain outstanding, the Company agrees to maintain an
office or agency in the Borough of Manhattan, the City and
State of New York, with respect to each such series and at such
other location or locations as may be designated as provided in
this Section 4.02, where (i) Debentures of that series may be
presented for payment, (ii) Debentures of that series may be
presented as hereinabove authorized for registration of trans-
fer and exchange, and (iii) notices and demands to or upon the
Company in respect of the Debentures of that series and this
Indenture may be given or served, such designation to continue
with respect to such office or agency until the Company shall,
by written notice signed by its President or a Vice President
and delivered to the Trustee, designate some other office or
agency for such purposes or any of them. If at any time the
Company shall fail to maintain any such required office or
agency or shall fail to furnish the Trustee with the address
thereof, such presentations, notices and demands may be made or
served at the Corporate Trust Office of the Trustee, and the
Company hereby appoints the Trustee as its agent to receive all
such presentations, notices and demands.
SECTION 4.03. (a) If the Company shall appoint one
or more paying agents for all or any series of the Debentures,
other than the Trustee, the Company will cause each such paying
agent to execute and deliver to the Trustee an instrument in
which such agent shall agree with the Trustee, subject to the
provisions of this Section:
(1) that it will hold all sums held by it as such
agent for the payment of the principal of (and premium, if
any) or interest on the Debentures of that series (whether
such sums have been paid to it by the Company or by any
other obligor of such Debentures) in trust for the benefit
of the persons entitled thereto;
(2) that it will give the Trustee notice of any
failure by the Company (or by any other obligor of such
Debentures) to make any payment of the principal of (and
premium, if any) or interest on the Debentures of that
series when the same shall be due and payable;
(3) that it will, at any time during the continuance
of any failure referred to in the preceding paragraph
(a)(2) above, upon the written request of the Trustee,
forthwith pay to the Trustee all sums so held in trust by
such paying agent; and
(4) that it will perform all other duties of paying
agent as set forth in this Indenture.
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<PAGE> 38
(b) If the Company shall act as its own paying agent
with respect to any series of the Debentures, it will on or
before each due date of the principal of (and premium, if any)
or interest on Debentures of that series, set aside, segregate
and hold in trust for the benefit of the persons entitled
thereto a sum sufficient to pay such principal (and premium, if
any) or interest so becoming due on Debentures of that series
until such sums shall be paid to such persons or otherwise dis-
posed of as herein provided and will promptly notify the
Trustee of such action, or any failure (by it or any other ob-
ligor on such Debentures) to take such action. Whenever the
Company shall have one or more paying agents for any series of
Debentures, it will, prior to each due date of the principal of
(and premium, if any) or interest on any Debentures of that
series, deposit with the paying agent a sum sufficient to pay
the principal (and premium, if any) or interest so becoming
due, such sum to be held in trust for the benefit of the per-
sons entitled to such principal, premium or interest, and (un-
less such paying agent is the Trustee) the Company will
promptly notify the Trustee of its action or failure so to act.
(c) Anything in this Section to the contrary not-
withstanding, (i) the agreement to hold sums in trust as pro-
vided in this Section is subject to the provisions of Section
11.05, and (ii) the Company may at any time, for the purpose of
obtaining the satisfaction and discharge of this Indenture or
for any other purpose, pay, or direct any paying agent to pay,
to the Trustee all sums held in trust by the Company or such
paying agent, such sums to be held by the Trustee upon the same
terms and conditions as those upon which such sums were held by
the Company or such paying agent; and, upon such payment by any
paying agent to the Trustee, such paying agent shall be re-
leased from all further liability with respect to such money.
SECTION 4.04. The Company, whenever necessary to
avoid or fill a vacancy in the office of Trustee, will appoint,
in the manner provided in Section 7.10, a Trustee, so that
there shall at all times be a Trustee hereunder.
SECTION 4.05. The Company will not, while any of the
Debentures remain outstanding, consolidate with, or merge into,
or merge into itself, or sell or convey all or substantially
all of its property to any other company unless the provisions
of Article Ten hereof are complied with.
SECTION 4.06. The Company 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
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at such time (i) there shall have occurred any Event of Default
under this Indenture, (ii) the Company shall be in default with
respect to its payment of any obligations under the Guarantee,
or (iii) the Company shall have given notice of its selection
of an extended interest payment period as provided in this
Indenture and such period, or any extension thereof, shall be
continuing.
SECTION 4.07. The Company will (i) remain the sole
general partner of Transamerica Delaware and maintain 100% own-
ership of the general partner interests thereof; provided that
any permitted successor of the Company under the Indenture may
succeed to its duties as general partner, (ii) contribute capi-
tal 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 voluntarily dissolve, wind up
or terminate Transamerica Delaware, except in connection with a
distribution of Debentures and in connection with certain merg-
ers, consolidations or amalgamations permitted by the Limited
Partnership Agreement, (iv) timely perform all of its duties as
General Partner of Transamerica Delaware and (v) use its rea-
sonable efforts to cause Transamerica Delaware to remain a lim-
ited partnership except in connection with a distribution of
Debentures and in connection with certain mergers, consolida-
tions or amalgamations permitted by the Limited Partnership
Agreement, and otherwise to continue to be treated as a part-
nership for United States federal income tax purposes except in
connection with a distribution of the Debentures.
ARTICLE FIVE
Debentureholders' Lists and Reports by the Company
and the Trustee
SECTION 5.01. The Company will furnish or cause to
be furnished to the Trustee (a) on a monthly basis on each reg-
ular record date (as defined in Section 2.03) a list, in such
form as the Trustee may reasonably require, of the names and
addresses of the holders of each series of Debentures as of
such regular record date, provided, that the Company shall not
be obligated to furnish or cause to furnish such list at any
time that the list shall not differ in any respect from the
most recent list furnished to the Trustee by the Company and
(b) at such other times as the Trustee may request in writing
within 30 days after the receipt by the Company of any such
request, a list of similar form and content as of a date not
more than 15 days prior to the time such list is furnished;
provided, however, no such list need be furnished for any
series for which the Trustee shall be the Debenture Registrar.
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SECTION 5.02. (a) The Trustee shall preserve, in as
current a form as is reasonably practicable, all information as
to the names and addresses of the holders of Debentures con-
tained in the most recent list furnished to it as provided in
Section 5.01 and as to the names and addresses of holders of
Debentures received by the Trustee in its capacity as Debenture
Registrar (if acting in such capacity).
(b) The Trustee may destroy any list furnished to it
as provided in Section 5.01 upon receipt of a new list so fur-
nished.
(c) In case three or more holders of Debentures of a
series (hereinafter referred to as "applicants") apply in writ-
ing to the Trustee, and furnish to the Trustee reasonable proof
that each such applicant has owned a Debenture for a period of
at least six months preceding the date of such application, and
such application states that the applicants desire to communi-
cate with other holders of Debentures of such series or holders
of all Debentures with respect to their rights under this In-
denture or under such Debentures, and is accompanied by a copy
of the form of proxy or other communication which such appli-
cants propose to transmit, then the Trustee shall, within five
business days after the receipt of such application, at its
election, either:
(1) afford to such applicants access to the informa-
tion preserved at the time by the Trustee in accordance
with the provisions of subsection (a) of this Section
5.02; or
(2) inform such applicants as to the approximate
number of holders of Debentures of such series or of all
Debentures, as the case may be, whose names and addresses
appear in the information preserved at the time by the
Trustee, in accordance with the provisions of subsection
(a) of this Section 5.02, and as to the approximate cost
of mailing to such Debentureholders the form of proxy or
other communication, if any, specified in such applica-
tion.
(d) If the Trustee shall elect not to afford such
applicants access to such information, the Trustee shall, upon
the written request of such applicants, mail to each holder of
such series or of all Debentures, as the case may be, whose
name and address appears in the information preserved at the
time by the Trustee in accordance with the provisions of sub-
section (a) of this Section 5.02, a copy of the form of proxy
or other communication which is specified in such request, with
reasonable promptness after a tender to the Trustee of the
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material to be mailed and of payment, or provision for the pay-
ment, of the reasonable expenses of mailing, unless within five
days after such tender, the Trustee shall mail to such appli-
cants and file with the Securities and Exchange Commission (the
"Commission"), together with a copy of the material to be
mailed, a written statement to the effect that, in the opinion
of the Trustee, such mailing would be contrary to the best in-
terests of the holders of Debentures of such series or of all
Debentures, as the case may be, or would be in violation of
applicable law. Such written statement shall specify the basis
of such opinion. If the Commission, after opportunity for a
hearing upon the objections specified in the written statement
so filed, shall enter an order refusing to sustain any of such
objections or if, after the entry of an order sustaining one or
more of such objections, the Commission shall find, after
notice and opportunity for hearing, that all the objections so
sustained have been met and shall enter an order so declaring,
the Trustee shall mail copies of such material to all such
Debentureholders with reasonable promptness after the entry of
such order and the renewal of such tender; otherwise, the
Trustee shall be relieved of any obligation or duty to such
applicants respecting their application.
(e) Each and every holder of the Debentures, by re-
ceiving and holding the same, agrees with the Company and the
Trustee that neither the Company nor the Trustee nor any paying
agent nor any Debenture Registrar shall be held accountable by
reason of the disclosure of any such information as to the
names and addresses of the holders of Debentures in accordance
with the provisions of subsection (b) of this Section, regard-
less of the source from which such information was derived, and
that the Trustee shall not be held accountable by reason of
mailing any material pursuant to a request made under said sub-
section (b).
SECTION 5.03. (a) The Company covenants and agrees
to file with the Trustee, within 15 days after the Company is
required to file the same with the Commission, copies of the
annual reports and of the information, documents and other re-
ports (or copies of such portions of any of the foregoing as
the Commission may from time to time by rules and regulations
prescribe) which the Company may be required to file with the
Commission pursuant to Section 13 or Section 15(d) of the Ex-
change Act; or, if the Company is not required to file informa-
tion, documents or reports pursuant to either of such sections,
then to file with the Trustee and the Commission, in accordance
with the rules and regulations prescribed from time to time by
the Commission, such of the supplementary and periodic informa-
tion, documents and reports which may be required pursuant to
Section 13 of the Exchange Act, in respect of a security listed
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and registered on a national securities exchange as may be pre-
scribed from time to time in such rules and regulations.
(b) The Company covenants and agrees to file with
the Trustee and the Commission, in accordance with the rules
and regulations prescribed from time to time by the Commission,
such additional information, documents and reports with respect
to compliance by the Company with the conditions and covenants
provided for in this Indenture as may be required from time to
time by such rules and regulations.
(c) The Company covenants and agrees to transmit by
mail, first class postage prepaid, or reputable over-night de-
livery service which provides for evidence of receipt, to the
Debentureholders, as their names and addresses appear upon the
Debenture Register, within 30 days after the filing thereof
with the Trustee, such summaries of any information, documents
and reports required to be filed by the Company pursuant to
subsections (a) and (b) of this Section as may be required by
rules and regulations prescribed from time to time by the Com-
mission.
(d) The Company covenants and agrees to furnish to
the Trustee, on or before May 15 in each calendar year in which
any of the Debentures are outstanding, or on or before such
other day in each calendar year as the Company and the Trustee
may from time to time agree upon, a Certificate as to his or
her knowledge of the Company's compliance with all conditions
and covenants under this Indenture. For purposes of this sub-
section (d), such compliance shall be determined without regard
to any period of grace or requirement of notice provided under
this Indenture.
SECTION 5.04. (a) On or before July 15 in each year
in which any of the Debentures are outstanding, the Trustee
shall transmit by mail, first class postage prepaid, to the
Debentureholders, as their names and addresses appear upon the
Debenture Register, a brief report dated as of the preceding
May 15, with respect to any of the following events which may
have occurred within the previous twelve months (but if no such
event has occurred within such period no report need be trans-
mitted):
(1) any change to its eligibility under Section
7.09, and its qualifications under Section 7.08;
(2) the creation of or any material change to a re-
lationship specified in paragraphs (1) through (10) of
subsection (c) of Section 7.08;
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(3) the character and amount of any advances (and if
the Trustee elects so to state, the circumstances sur-
rounding the making thereof) made by the Trustee (as such)
which remain unpaid on the date of such report, and for
the reimbursement of which it claims or may claim a lien
or charge, prior to that of the Debentures, on any prop-
erty or funds held or collected by it as Trustee if such
advances so remaining unpaid aggregate more than 1/2 of 1%
of the principal amount of the Debentures outstanding on
the date of such report;
(4) any change to the amount, interest rate, and
maturity date of all other indebtedness owing by the Com-
pany, or by any other obligor on the Debentures, to the
Trustee in its individual capacity, on the date of such
report, with a brief description of any property held as
collateral security therefor, except any indebtedness
based upon a creditor relationship arising in any manner
described in paragraph (2), (3), (4), or (6) of subsection
(b) of Section 7.13;
(5) any change to the property and funds, if any,
physically in the possession of the Trustee as such on the
date of such report;
(6) any release, or release and substitution, of
property subject to the lien of this Indenture (and the
consideration thereof, if any) which it has not previously
reported;
(7) any additional issue of Debentures which the
Trustee has not previously reported; and
(8) any action taken by the Trustee in the perfor-
mance of its duties under this Indenture which it has not
previously reported and which in its opinion materially
affects the Debentures or the Debentures of any series,
except any action in respect of a default, notice of which
has been or is to be withheld by it in accordance with the
provisions of Section 6.07.
(b) The Trustee shall transmit by mail, first class
postage prepaid, to the Debentureholders, as their names and
addresses appear upon the Debenture Register, a brief report
with respect to the character and amount of any advances (and
if the Trustee elects so to state, the circumstances surround-
ing the making thereof) made by the Trustee as such since the
date of the last report transmitted pursuant to the provisions
of subsection (a) of this Section (or if no such report has yet
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been so transmitted, since the date of execution of this Inden-
ture), for the reimbursement of which it claims or may claim a
lien or charge prior to that of the Debentures of any series on
property or funds held or collected by it as Trustee, and which
it has not previously reported pursuant to this subsection if
such advances remaining unpaid at any time aggregate more than
10% of the principal amount of Debentures of such series out-
standing at such time, such report to be transmitted within 90
days after such time.
(c) A copy of each such report shall, at the time of
such transmission to Debentureholders, be filed by the Trustee
with the Company, with each stock exchange upon which any De-
bentures are listed (if so listed) and also with the Commis-
sion. The Company agrees to notify the Trustee when any Deben-
tures become listed on any stock exchange.
ARTICLE SIX
Remedies of the Trustee and Debentureholders
on Event of Default
SECTION 6.01. (a) Whenever used herein with respect
to Debentures of a particular series, "Event of Default" means
any one or more of the following events which has occurred and
is continuing:
(1) default in the payment of any installment of
interest upon any of the Debentures of that series, as and
when the same shall become due and payable, and continu-
ance of such default for a period of 10 days; provided,
however, that a valid extension of an interest payment
period by the Company in accordance with the terms of any
indenture supplemental hereto, shall not constitute a
default in the payment of interest for this purpose;
(2) default in the payment of the principal of (or
premium, if any, on) any of the Debentures of that series
as and when the same shall become due and payable whether
at maturity, upon redemption, by declaration or otherwise,
or in any payment required by any sinking or analogous
fund established with respect to that series;
(3) failure on the part of the Company duly to ob-
serve or perform any other of the covenants or agreements
on the part of the Company with respect to that series
contained in such Debentures or otherwise established with
respect to that series of Debentures pursuant to Section
2.01 hereof or contained in this Indenture (other than a
covenant or agreement which has been expressly included in
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this Indenture solely for the benefit of one or more se-
ries of Debentures other than such series) for a period of
90 days after the date on which written notice of such
failure, requiring the same to be remedied and stating
that such notice is a "Notice of Default" hereunder, shall
have been given to the Company by the Trustee, by regis-
tered or certified mail, or to the Company and the Trustee
by the holders of at least 25% in principal amount of the
Debentures of that series at the time outstanding;
(4) a decree or order by a court having jurisdiction
in the premises shall have been entered adjudging the Com-
pany as bankrupt or insolvent, or approving as properly
filed a petition seeking liquidation or reorganization of
the Company under the Federal Bankruptcy Code or any other
similar applicable Federal or State law, and such decree
or order shall have continued unvacated and unstayed for a
period of 90 days; or an involuntary case shall be com-
menced under such Code in respect of the Company and shall
continue undismissed for a period of 90 days or an order
for relief in such case shall have been entered; or a de-
cree or order of a court having jurisdiction in the pre-
mises shall have been entered for the appointment on the
ground of insolvency or bankruptcy of a receiver or custo-
dian or liquidator or trustee or assignee in bankruptcy or
insolvency of the Company or of its property, or for the
winding up or liquidation of its affairs, and such decree
or order shall have remained in force unvacated and un-
stayed for a period of 90 days;
(5) the Company shall institute proceedings to be
adjudicated a voluntary bankrupt, or shall consent to the
filing of a bankruptcy proceeding against it, or shall
file a petition or answer or consent seeking liquidation
or reorganization under the Federal Bankruptcy Code or any
other similar applicable Federal or State law, or shall
consent to the filing of any such petition, or shall con-
sent to the appointment on the ground of insolvency or
bankruptcy of a receiver or custodian or liquidator or
trustee or assignee in bankruptcy or insolvency of it or
of its property, or shall make an assignment for the ben-
efit of creditors; or
(6) Transamerica Delaware shall have dissolved,
wound up its business or otherwise terminated its exist-
ence except in connection with the distribution of Deben-
tures to limited partners of Transamerica Delaware in liq-
uidation of their interests in Transamerica Delaware and
in connection with mergers, consolidations or
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<PAGE> 46
amalgamations permitted by the Limited Partnership Agree-
ment.
(b) In each and every such case, unless the princi-
pal of all the Debentures of that series shall have already
become due and payable, either the Trustee or the holders of
not less than 25% in aggregate principal amount of the Deben-
tures of that series then outstanding hereunder, by notice in
writing to the Company (and to the Trustee if given by such
Debentureholders), may declare the principal of all the Deben-
tures of that series to be due and payable immediately, and
upon any such declaration the same shall become and shall be
immediately due and payable, anything contained in this Inden-
ture or in the Debentures of that series or established with
respect to that series pursuant to Section 2.01 hereof to the
contrary notwithstanding.
(c) Section 6.01(b), however, is subject to the con-
dition that if, at any time after the principal of the Deben-
tures of that series shall have been so declared due and pay-
able, and before any judgment or decree for the payment of the
moneys due shall have been obtained or entered as hereinafter
provided, the Company shall pay or shall deposit with the
Trustee a sum sufficient to pay all matured installments of
interest upon all the Debentures of that series and the princi-
pal of (and premium, if any, on) any and all Debentures of that
series which shall have become due otherwise than by accelera-
tion (with interest upon such principal and premium, if any,
and, to the extent that such payment is enforceable under ap-
plicable law, upon overdue installments of interest, at the
rate per annum expressed in the Debentures of that series to
the date of such payment or deposit) and the amount payable to
the Trustee under Section 7.06, and any and all defaults under
the Indenture, other than the nonpayment of principal on Deben-
tures of that series which shall not have become due by their
terms, shall have been remedied or waived as provided in Sec-
tion 6.06 then and in every such case the holders of a majority
in aggregate principal amount of the Debentures of that series
then outstanding, by written notice to the Company and to the
Trustee, may rescind and annul such declaration and its conse-
quences with respect to that series of Debentures; but no such
rescission and annulment shall extend to or shall affect any
subsequent default, or shall impair any right consequent
thereon.
(d) In case the Trustee shall have proceeded to en-
force any right with respect to Debentures of that series under
this Indenture and such proceedings shall have been discontin-
ued or abandoned because of such rescission or annulment or for
any other reason or shall have been determined adversely to the
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<PAGE> 47
Trustee, then and in every such case the Company and the Trust-
ee shall be restored respectively to their former positions and
rights hereunder, and all rights, remedies and powers of the
Company and the Trustee shall continue as though no such pro-
ceedings had been taken.
SECTION 6.02. (a) The Company covenants that (1) in
case default shall be made in the payment of any installment of
interest on any of the Debentures of a series, or any payment
required by any sinking or analogous fund established with re-
spect to that series as and when the same shall have become due
and payable, and such default shall have continued for a period
of 10 business days, or (2) in case default shall be made in
the payment of the principal of (or premium, if any, on) any of
the Debentures of a series when the same shall have become due
and payable, whether upon maturity of the Debentures of a se-
ries or upon redemption or upon declaration or otherwise, then,
upon demand of the Trustee, the Company will pay to the Trust-
ee, for the benefit of the holders of the Debentures of that
series, the whole amount that then shall have become due and
payable on all such Debentures for principal (and premium, if
any) or interest, or both, as the case may be, with interest
upon the overdue principal (and premium, if any) and (to the
extent that payment of such interest is enforceable under ap-
plicable law and without duplication of any other amounts paid
by the Company or Transamerica Delaware in respect thereof)
upon overdue installments of interest at the rate per annum
expressed in the Debentures of that series; and, in addition
thereto, such further amount as shall be sufficient to cover
the costs and expenses of collection, and the amount payable to
the Trustee under Section 7.06.
(b) In case the Company shall fail forthwith to pay
such amounts upon such demand, the Trustee, in its own name and
as trustee of an express trust, shall be entitled and empowered
to institute any action or proceedings at law or in equity for
the collection of the sums so due and unpaid, and may prosecute
any such action or proceeding to judgment or final decree, and
may enforce any such judgment or final decree against the Com-
pany or other obligor upon the Debentures of that series and
collect in the manner provided by law out of the property of
the Company or other obligor upon the Debentures of that series
wherever situated the moneys adjudged or decreed to be payable.
(c) In case of any receivership, insolvency, liqui-
dation, bankruptcy, reorganization, readjustment, arrangement,
composition or other judicial proceedings affecting the Com-
pany, any other obligor on such Debentures, or the creditors or
property of either, the Trustee shall have power to intervene
in such proceedings and take any action therein that may be
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permitted by the court and shall (except as may be otherwise
provided by law) be entitled to file such proofs of claim and
other papers and documents as may be necessary or advisable in
order to have the claims of the Trustee and of the holders of
Debentures of such series allowed for the entire amount due and
payable by the Company or such other obligor under the Inden-
ture at the date of institution of such proceedings and for any
additional amount which may become due and payable by the Com-
pany or such other obligor after such date, and to collect and
receive any moneys or other property payable or deliverable on
any such claim, and to distribute the same after the deduction
of the amount payable to the Trustee under Section 7.06; and
any receiver, assignee or trustee in bankruptcy or reorganiza-
tion is hereby authorized by each of the holders of Debentures
of such series to make such payments to the Trustee, and, in
the event that the Trustee shall consent to the making of such
payments directly to such Debentureholders, to pay to the
Trustee any amount due it under Section 7.06.
(d) All rights of action and of asserting claims
under this Indenture, or under any of the terms established
with respect to Debentures of that series, may be enforced by
the Trustee without the possession of any of such Debentures,
or the production thereof at any trial or other proceeding rel-
ative thereto, and any such suit or proceeding instituted by
the Trustee shall be brought in its own name as trustee of an
express trust, and any recovery of judgment shall, after provi-
sion for payment to the Trustee of any amounts due under Sec-
tion 7.06, be for the ratable benefit of the holders of the
Debentures of such series.
In case of an Event of Default hereunder, the Trustee
may in its discretion proceed to protect and enforce the rights
vested in it by this Indenture by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect
and enforce any of such rights, either at law or in equity or
in bankruptcy or otherwise, whether for the specific enforce-
ment of any covenant or agreement contained in the Indenture or
in aid of the exercise of any power granted in this Indenture,
or to enforce any other legal or equitable right vested in the
Trustee by this Indenture or by law.
Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on
behalf of any Debentureholder any plan of reorganization, ar-
rangement, adjustment or composition affecting the Debentures
of that series or the rights of any holder thereof or to autho-
rize the Trustee to vote in respect of the claim of any Deben-
tureholder in any such proceeding.
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<PAGE> 49
SECTION 6.03. Any moneys collected by the Trustee
pursuant to Section 6.02 with respect to a particular series of
Debentures shall be applied in the order following, at the date
or dates fixed by the Trustee and, in case of the distribution
of such moneys on account of principal (or premium, if any) or
interest, upon presentation of the several Debentures of that
series, and stamping thereon the payment, if only partially
paid, and upon surrender thereof if fully paid:
FIRST: To the payment of costs and expenses of col-
lection and of all amounts payable to the Trustee under
Section 7.06; and
SECOND: To the payment of the amounts then due and
unpaid upon Debentures of such series for principal (and
premium, if any) and interest, in respect of which or for
the benefit of which such money has been collected, rat-
ably, without preference or priority of any kind, accord-
ing to the amounts due and payable on such Debentures for
principal (and premium, if any) and interest, respec-
tively.
SECTION 6.04. No holder of any Debenture of any se-
ries shall have any right by virtue or by availing of any pro-
vision of this Indenture to institute any suit, action or pro-
ceeding in equity or at law upon or under or with respect to
this Indenture or for the appointment of a receiver or trustee,
or for any other remedy hereunder, unless such holder previ-
ously shall have given to the Trustee written notice of an
Event of Default and of the continuance thereof with respect to
Debentures of such series specifying such Event of Default, as
hereinbefore provided, and unless also the holders of not less
than 25% in aggregate principal amount of the Debentures of
such series then outstanding shall have made written request
upon the Trustee to institute such action, suit or proceeding
in its own name as trustee hereunder and shall have offered to
the Trustee such reasonable indemnity as it may require against
the costs, expenses and liabilities to be incurred therein or
thereby, and the Trustee for 60 days after its receipt of such
notice, request and offer of indemnity, shall have failed to
institute any such action, suit or proceeding; it being under-
stood and intended, and being expressly covenanted by the taker
and holder of every Debenture of such series with every other
such taker and holder and the Trustee, that no one or more
holders of Debentures of such series shall have any right in
any manner whatsoever by virtue or by availing of any provision
of this Indenture to affect, disturb or prejudice the rights of
the holders of any other of such Debentures, or to obtain or
seek to obtain priority over or preference to any other such
holder, or to enforce any right under this Indenture, except in
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<PAGE> 50
the manner herein provided and for the equal, ratable and com-
mon benefit of all holders of Debentures of such series. For
the protection and enforcement of the provisions of this Sec-
tion, each and every Debentureholder and the Trustee shall be
entitled to such relief as can be given either at law or in
equity.
Notwithstanding any other provisions of this Inden-
ture, however, the right of any holder of any Debenture to re-
ceive payment of the principal of (and premium, if any) and
interest on such Debenture, as therein provided, on or after
the respective due dates expressed in such Debenture (or in the
case of redemption, on the redemption date), or to institute
suit for the enforcement of any such payment on or after such
respective dates or redemption date, shall not be impaired or
affected without the consent of such holder.
SECTION 6.05. (a) All powers and remedies given by
this Article to the Trustee or to the Debentureholders shall,
to the extent permitted by law, be deemed cumulative and not
exclusive of any other powers and remedies available to the
Trustee or the holders of the Debentures, by judicial proceedings
or otherwise, to enforce the performance or observance of the
covenants and agreements contained in this Indenture or otherwise
established with respect to such Debentures.
(b) No delay or omission of the Trustee or of any
holder of any of the Debentures to exercise any right or power
accruing upon any Event of Default occurring and continuing as
aforesaid shall impair any such right or power, or shall be
construed to be a waiver of any such default or an acquiescence
therein; and, subject to the provisions of Section 6.04, every
power and remedy given by this Article or by law to the Trustee
or to the Debentureholders may be exercised from time to time,
and as often as shall be deemed expedient, by the Trustee or by
the Debentureholders.
SECTION 6.06. The holders of a majority in aggregate
principal amount of the Debentures of any series at the time
outstanding, determined in accordance with Section 8.04, shall
have the right to direct the time, method and place of conduct-
ing any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee with
respect to such series; provided, however, that such direction
shall not be in conflict with any rule of law or with this In-
denture or be unduly prejudicial to the rights of holders of De-
bentures of any other series at the time outstanding determined
in accordance with Section 8.04. Subject to the provisions of
Section 7.01, the Trustee shall have the
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right to decline to follow any such direction if the Trustee in
good faith shall, by a Responsible Officer or Officers of the
Trustee, determine that the proceeding so directed would in-
volve the Trustee in personal liability. The holders of a ma-
jority in aggregate principal amount of the Debentures of any
series at the time outstanding affected thereby, determined in
accordance with Section 8.04, may on behalf of the holders of
all of the Debentures of such series waive any past default in
the performance of any of the covenants contained herein or
established pursuant to Section 2.01 with respect to such se-
ries and its consequences, except a default in the payment of
the principal of, or premium, if any, or interest on, any of
the Debentures of that series as and when the same shall become
due by the terms of such Debentures otherwise than by acceleration
(unless such default has been cured and a sum sufficient to
pay all matured installments of interest and principal and any
premium has been deposited with the Trustee (in accordance with
Section 6.01(c))) or a call for redemption of Debentures of
that series. Upon any such waiver, the default covered
thereby shall be deemed to be cured for all purposes of
this Indenture and the Company, the Trustee and the holders
of the Debentures of such series shall be restored to their
former positions and rights hereunder, respectively; but no
such waiver shall extend to any subsequent or other default
or impair any right consequent thereon.
SECTION 6.07. The Trustee shall, within 90 days
after the occurrence of a default with respect to a particular
series, transmit by mail, first class postage prepaid, to the
holders of Debentures of that series, as their names and ad-
dresses appear upon the Debenture Register, notice of all de-
faults with respect to that series known to the Trustee, unless
such defaults shall have been cured before the giving of such
notice (the term "defaults" for the purposes of this Section
being hereby defined to be the events specified in subsections
(1), (2), (3), (4), (5) and (6) of Section 6.01(a), not includ-
ing any periods of grace provided for therein and irrespective
of the giving of notice provided for by subsection (3) of Sec-
tion 6.01(a)); provided, that, except in the case of default in
the payment of the principal of (or premium, if any) or inter-
est on any of the Debentures of that series or in the payment
of any sinking fund installment established with respect to
that series, the Trustee shall be protected in withholding such
notice if and so long as the board of directors, the executive
committee, or a trust committee of directors and/or Responsible
Officers, of the Trustee in good faith determine that the with-
holding of such notice is in the interests of the holders of
Debentures of that series; provided further, that in the case
of any default of the character specified in Section 6.01(a)(3)
with respect to Debentures of such series no such notice to the
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holders of the Debentures of that series shall be given until
at least 30 days after the occurrence thereof.
The Trustee shall not be deemed to have knowledge of
any default, except (i) a default under subsection (a)(1) or
(a)(2) of Section 6.01 as long as the Trustee is acting as pay-
ing agent for such series of Debentures or (ii) any default as
to which the Trustee shall have received written notice or a
Responsible Officer charged with the administration of this
Indenture shall have obtained written notice.
SECTION 6.08. All parties to this Indenture agree,
and each holder of any Debentures by acceptance thereof shall be
deemed to have agreed, that any court may in its discretion require,
in any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken
or omitted by it as Trustee, the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in such
suit, having due regard to the merits and good faith of the claims
or defenses made by such party litigant; but the provisions of this
Section shall not apply to any suit instituted by the Trustee,
to any suit instituted by any Debentureholder, or group of
Debentureholders, holding more than 10% in aggregate principal
amount of the outstanding Debentures of any series, or to any suit
instituted by any Debentureholder for the enforcement of the payment
of the principal of (or premium, if any) or interest on any Debenture
of such series, on or after the respective due dates expressed in such
Debenture or established pursuant to this Indenture.
ARTICLE SEVEN
Concerning the Trustee
SECTION 7.01. (a) The Trustee, prior to the occur-
rence of an Event of Default with respect to Debentures of a
series and after the curing of all Events of Default with re-
spect to Debentures of that series which may have occurred,
shall undertake to perform with respect to Debentures of such
series such duties and only such duties as are specifically set
forth in this Indenture, and no implied covenants shall be read
into this Indenture against the Trustee. In case an Event of
Default with respect to Debentures of a series has occurred
(which has not been cured or waived), the Trustee shall exer-
cise with respect to Debentures of that series such of the
rights and powers vested in it by this Indenture, and use the
same degree of care and skill in their exercise, as a prudent
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man would exercise or use under the circumstances in the con-
duct of his own affairs.
(b) No provision of this Indenture shall be con-
strued to relieve the Trustee from liability for its own negli-
gent action, its own negligent failure to act, or its own will-
ful misconduct, except that:
(1) prior to the occurrence of an Event of Default
with respect to Debentures of a series and after the cur-
ing or waiving of all such Events of Default with respect
to that series which may have occurred:
(i) the duties and obligations of the Trustee
shall with respect to Debentures of such series be
determined solely by the express provisions of this
Indenture, and the Trustee shall not be liable with
respect to Debentures of such series except for the
performance of such duties and obligations as are
specifically set forth in this Indenture, and no im-
plied covenants or obligations shall be read into
this Indenture against the Trustee; and
(ii) in the absence of bad faith on the part of
the Trustee, the Trustee may with respect to Deben-
tures of such series conclusively rely, as to the
truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or
opinions furnished to the Trustee and conforming to
the requirements of this Indenture; but in the case
of any such certificates or opinions which by any
provision hereof are specifically required to be fur-
nished to the Trustee, the Trustee shall be under a
duty to examine the same to determine whether or not
they conform to the requirements of this Indenture;
(2) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer or
Responsible Officers of the Trustee, unless it shall be
proved that the Trustee was negligent in ascertaining
the pertinent facts;
(3) the Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good
faith in accordance with the direction of the holders of
not less than a majority in principal amount of the Deben-
tures of any series at the time outstanding relating to
the time, method and place of conducting any proceeding
for any remedy available to the Trustee, or exercising any
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trust or power conferred upon the Trustee under this In-
denture with respect to the Debentures of that series; and
(4) None of the provisions contained in this Inden-
ture shall require the Trustee to expend or risk its own
funds or otherwise incur personal financial liability in
the performance of any of its duties or in the exercise of
any of its rights or powers, if there is reasonable ground
for believing that the repayment of such funds or liabil-
ity is not reasonably assured to it under the terms of
this Indenture or adequate indemnity against such risk is
not reasonably assured to it.
SECTION 7.02. Except as otherwise provided in Sec-
tion 7.01:
(a) The Trustee may rely and shall be protected in
acting or refraining from acting upon any resolution, cer-
tificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, bond, security or other
paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;
(b) Any request, direction, order or demand of the
Company mentioned herein shall be sufficiently evidenced
by a Board Resolution or an instrument signed in the name
of the Company by the President or any Vice President and
by the Secretary or an Assistant Secretary or the Trea-
surer or an Assistant Treasurer (unless other evidence in
respect thereof is specifically prescribed herein);
(c) The Trustee may consult with counsel and the
written advice of such counsel or any Opinion of Counsel
shall be full and complete authorization and protection in
respect of any action taken or suffered or omitted here-
under in good faith and in reliance thereon;
(d) The Trustee shall be under no obligation to ex-
ercise any of the rights or powers vested in it by this
Indenture at the request, order or direction of any of the
Debentureholders, pursuant to the provisions of this In-
denture, unless such Debentureholders shall have offered
to the Trustee reasonable security or indemnity against
the costs, expenses and liabilities which may be incurred
therein or thereby; nothing herein contained shall, how-
ever, relieve the Trustee of the obligation, upon the
occurrence of an Event of Default with respect to a series
of the Debentures (which has not been cured or waived) to
exercise with respect to Debentures of that series such of
the rights and powers vested in it by this Indenture, and
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<PAGE> 55
to use the same degree of care and skill in their exer-
cise, as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs;
(e) The Trustee shall not be liable for any action
taken or omitted to be taken by it in good faith and be-
lieved by it to be authorized or within the discretion or
rights or powers conferred upon it by this Indenture;
(f) The Trustee shall not be bound to make any in-
vestigation into the facts or matters stated in any reso-
lution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond,
security, or other papers or documents, unless requested
in writing so to do by the holders of not less than a
majority in principal amount of the outstanding Debentures
of the particular series affected thereby (determined as
provided in Section 8.04); provided, however, that if the
payment within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be incurred by it
in the making of such investigation is, in the opinion of
the Trustee, not reasonably assured to the Trustee by the
security afforded to it by the terms of this Indenture,
the Trustee may require reasonable indemnity against such
costs, expenses or liabilities as a condition to so pro-
ceeding. The reasonable expense of every such examination
shall be paid by the Company or, if paid by the Trustee,
shall be repaid by the Company upon demand; and
(g) The Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either
directly or by or through agents or attorneys and the
Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed
with due care by it hereunder.
SECTION 7.03. (a) The recitals contained herein and
in the Debentures (other than the Certificate of Authentication
on the Debentures) shall be taken as the statements of the Com-
pany, and the Trustee assumes no responsibility for the cor-
rectness of the same.
(b) The Trustee makes no representations as to the
validity or sufficiency of this Indenture or of the Debentures.
(c) The Trustee shall not be accountable for the use
or application by the Company of any of the Debentures or of
the proceeds of such Debentures, or for the use or application
of any moneys paid over by the Trustee in accordance with any
provision of this Indenture or established pursuant to Section
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2.01, or for the use or application of any moneys received by
any paying agent other than the Trustee.
SECTION 7.04. The Trustee or any paying agent or De-
benture Registrar, in its individual or any other capacity, may
become the owner or pledgee of Debentures with the same rights
it would have if it were not Trustee, paying agent or Debenture
Registrar.
SECTION 7.05. Subject to the provisions of Section
11.05, all moneys received by the Trustee shall, until used or
applied as herein provided, be held in trust for the purposes
for which they were received, but need not be segregated from
other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any moneys received
by it hereunder except such as it may agree with the Company to
pay thereon.
SECTION 7.06. (a) The Company covenants and agrees
to pay to the Trustee from time to time, and the Trustee shall
be entitled to, reasonable compensation (which shall not be
limited by any provision of law in regard to the compensation
of a trustee of an express trust) for all services rendered by
it in the execution of the trusts hereby created and in the
exercise and performance of any of the powers and duties here-
under of the Trustee, and the Company will pay or reimburse the
Trustee upon its request for all reasonable expenses, disburse-
ments and advances incurred or made by the Trustee in accor-
dance with any of the provisions of this Indenture (including
the reasonable compensation and the expenses and disbursements
of its counsel and of all persons not regularly in its employ)
except any such expense, disbursement or advance as may arise
from its negligence or bad faith. The Company also covenants
to indemnify the Trustee (and its officers, agents, directors
and employees) for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith
on the part of the Trustee and arising out of or in connection
with the acceptance or administration of this trust, including
the costs and expenses of defending itself against any claim of
liability in the premises.
(b) The obligations of the Company under this Sec-
tion to compensate and indemnify the Trustee and to pay or re-
imburse the Trustee for expenses, disbursements and advances
shall constitute additional indebtedness hereunder. Such ad-
ditional indebtedness shall be secured by a lien prior to that
of the Debentures upon all property and funds held or collected
by the Trustee as such, except funds held in trust for the ben-
efit of the holders of particular Debentures.
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SECTION 7.07. Except as otherwise provided in Sec-
tion 7.01, whenever in the administration of the provisions of
this Indenture the Trustee shall deem it necessary or desirable
that a matter be proved or established prior to taking or suf-
fering or omitting to take any action hereunder, such matter
(unless other evidence in respect thereof be herein specifi-
cally prescribed) may, in the absence of negligence or bad
faith on the part of the Trustee, be deemed to be conclusively
proved and established by an Officers' Certificate delivered to
the Trustee and such certificate, in the absence of negligence
or bad faith on the part of the Trustee, shall be full warrant
to the Trustee for any action taken, suffered or omitted to be
taken by it under the provisions of this Indenture upon the
faith thereof.
SECTION 7.08. (a) If the Trustee has or shall ac-
quire any conflicting interest, as defined in this Section,
with respect to the Debentures of any series and if the Default
to which such conflicting interest relates has not been cured,
duly waived or otherwise eliminated, within 90 days after as-
certaining that it has such conflicting interest, it shall ei-
ther eliminate such conflicting interest, except as otherwise
provided herein, or resign with respect to the Debentures of
that series in the manner and with the effect specified in Sec-
tion 7.10 and the Company shall promptly appoint a successor
Trustee in the manner provided herein.
(b) In the event that the Trustee shall fail to com-
ply with the provisions of subsection (a) of this Section, with
respect to the Debentures of any series the Trustee shall,
within ten days after the expiration of such 90-day period,
transmit notice of such failure by mail, first class postage
prepaid, to the Debentureholders of that series as their names
and addresses appear upon the Debenture Register.
(c) For the purposes of this Section the Trustee
shall be deemed to have a conflicting interest with respect to
the Debentures of any series if a Default has occurred and is
continuing and:
(1) the Trustee is trustee under this Indenture with
respect to the outstanding Debentures of any series other
than that series, or is trustee under another indenture
under which any other securities, or certificates of in-
terest or participation in any other securities, of the
Company are outstanding, unless such other indenture is a
collateral trust indenture under which the only collateral
consists of Debentures issued under this Indenture; pro-
vided that there shall be excluded from the operation of
this paragraph the Debentures of any series other than
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that series and any other indenture or indentures under
which other securities, or certificates of interest or
participation in other securities, of the Company are out-
standing if (i) this Indenture and such other indenture or
indentures and all series of securities issuable thereun-
der are wholly unsecured and rank equally and such other
indenture or indentures (and such series) are hereafter
qualified under the Trust Indenture Act, unless the Com-
mission shall have found and declared by order pursuant to
subsection (b) of Section 305 or subsection (c) of Section
307 of the Trust Indenture Act, that differences exist
between (A) the provisions of this Indenture with respect
to Debentures of that series and with respect to one or
more other series or (B) the provisions of this Indenture
and the provisions of such other indenture or indentures
(or such series), which are so likely to involve a mate-
rial conflict of interest as to make it necessary in the
public interest or for the protection of investors to dis-
qualify the Trustee from acting as such under this Inden-
ture with respect to the Debentures of that series and
such other series or such other indenture or indentures,
or (ii) the Company shall have sustained the burden of
proving, on application to the Commission and after oppor-
tunity for hearing thereon, that the trusteeship under
this Indenture with respect to Debentures of that series
and such other series or such other indenture or inden-
tures is not so likely to involve a material conflict of
interest as to make it necessary in the public interest or
for the protection of investors to disqualify the Trustee
from acting as such under this Indenture with respect to
Debentures of that series and such other series or under
such other indentures;
(2) the Trustee or any of its directors or executive
officers is an underwriter for the Company;
(3) the Trustee directly or indirectly controls or
is directly or indirectly controlled by or is under direct
or indirect common control with an underwriter for the
Company;
(4) the Trustee or any of its directors or executive
officers is a director, officer, partner, employee, ap-
pointee or representative of the Company, or of an under-
writer (other than the Trustee itself) for the Company who
is currently engaged in the business of underwriting, ex-
cept that (A) one individual may be a director and/or an
executive officer of the Trustee and a director and/or an
executive officer of the Company, but may not be at the
same time an executive officer of both the Trustee and the
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Company; (B) if and so long as the number of directors of
the Trustee in office is more than nine, one additional
individual may be a director and/or an executive officer
of the Trustee and a director of the Company; and (C) the
Trustee may be designated by the Company or by an under-
writer for the Company to act in the capacity of transfer
agent, registrar, custodian, paying agent, fiscal agent,
escrow agent, or depository, or in any other similar ca-
pacity, or, subject to the provisions of paragraph (1) of
this subsection (c), to act as trustee whether under an
indenture or otherwise;
(5) 10% or more of the voting securities of the
Trustee is beneficially owned either by the Company or by
any director, partner, or executive officer thereof, or
20% or more of such voting securities is beneficially
owned, collectively, by any two or more of such persons;
or 10% or more of the voting securities of the Trustee is
beneficially owned either by an underwriter for the Com-
pany or by any director, partner, or executive officer
thereof, or is beneficially owned, collectively, by any
two or more such persons;
(6) the Trustee is the beneficial owner of, or holds
as collateral security for an obligation which is in de-
fault (as hereinafter in this subsection (c) defined), (A)
5% or more of the voting securities, or 10% or more of any
other class of security, of the Company, not including the
Debentures issued under this Indenture and securities is-
sued under any other indenture under which the Trustee is
also trustee, or (B) 10% or more of any class of security
of an underwriter for the Company;
(7) the Trustee is the beneficial owner of, or holds
as collateral security for an obligation which is in de-
fault (as hereinafter in this subsection (c) defined), 5%
or more of the voting securities of any person who, to the
knowledge of the Trustee, owns 10% or more of the voting
securities of, or controls directly or indirectly or is
under direct or indirect common control with, the Company;
(8) the Trustee is the beneficial owner of, or holds
as collateral security for an obligation which is in de-
fault (as hereinafter in this subsection (c) defined), 10%
or more of any class of security of any person who, to the
knowledge of the Trustee, owns 50% or more of the voting
securities of the Company;
(9) the Trustee owns, on the date of Default upon
the Debentures of any series or any anniversary of such
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Default while such Default upon the Debentures issued un-
der this Indenture remains outstanding, in the capacity of
executor, administrator, testamentary or inter vivos
trustee, guardian, committee or conservator, or in any
other similar capacity, an aggregate of 25% or more of the
voting securities, or of any class of security, of any
person, the beneficial ownership of a specified percentage
of which would have constituted a conflicting interest
under paragraph (6), (7), or (8) of this subsection (c).
As to any such securities of which the Trustee acquired
ownership through becoming executor, administrator or tes-
tamentary trustee of an estate which include them, the
provisions of the preceding sentence shall not apply, for
a period of two years from the date of such acquisition,
to the extent that such securities included in such estate
do not exceed 25% of such voting securities or 25% of any
such class of security. Promptly after the dates of any
such Default upon the Debentures issued under this Inden-
ture and annually in each succeeding year that the Deben-
tures issued under this Indenture remain in Default, the
Trustee shall make a check of its holding of such securi-
ties in any of the above-mentioned capacities as of such
dates. If the Company fails to make payment in full of
principal of or interest on any of the Debentures when and
as the same becomes due and payable, and such failure con-
tinues for 30 days thereafter, the Trustee shall make a
prompt check of its holding of such securities in any of
the above-mentioned capacities as of the date of the expi-
ration of such 30-day period, and after such date, not-
withstanding the foregoing provisions of this paragraph
(9), all such securities so held by the Trustee, with sole
or joint control over such securities vested in it, shall,
but only so long as such failure shall continue, be con-
sidered as though beneficially owned by the Trustee for
the purposes of paragraphs (6), (7) and (8) of this sub-
section (c); or
(10) except under the circumstances described in
paragraph (1), (3), (4), (5) or (6) of subsection (b) of
Section 7.13 the Trustee shall be or shall become a credi-
tor of the Company.
For purposes of paragraph (1) of this subsection (c),
and of Section 6.06, the term "series of securities" or "se-
ries" means a series, class or group of securities issuable
under an indenture pursuant to whose terms holders of one such
series may vote to direct the indenture trustee, or otherwise
take action pursuant to a vote of such holders, separately from
holders of another such series; provided, that "series of secu-
rities" or "series" shall not include any series of securities
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issuable under an indenture if all such series rank equally and
are wholly unsecured.
The specification of percentages in paragraphs (5) to
(9), inclusive, of this subsection (c) shall not be construed
as indicating that the ownership of such percentages of the
securities of a person is or is not necessary or sufficient to
constitute direct or indirect control for the purposes of para-
graph (3) or (7) of this subsection (c).
For the purposes of paragraphs (6), (7), (8) and (9)
of this subsection (c) only, (A) the terms "security" and "se-
curities" shall include only such securities as are generally
known as corporate securities, but shall not include any note
or other evidence of indebtedness issued to evidence an obliga-
tion to repay moneys lent to a person by one or more banks,
trust companies or banking firms, or any certificate of inter-
est or participation in any such note or evidence of indebted-
ness; (B) an obligation shall be deemed to be in "default" when
a default in payment of principal shall have continued for 30
days or more and shall not have been cured; and (C) the Trustee
shall not be deemed to be the owner or holder of (i) any secu-
rity which it holds as collateral security (as trustee or oth-
erwise) for any obligation which is not in default as defined
in clause (B) above, or (ii) any security which it holds as
collateral security under this Indenture, irrespective of any
Default hereunder, or (iii) any security which it holds as
agent for collection, or as custodian, escrow agent or deposi-
tary, or in any similar representative capacity.
Except as above provided, the word "security" or "se-
curities" as used in this Indenture shall mean any note, stock,
treasury stock, bond, debenture, evidence of indebtedness, cer-
tificate of interest or participation in any profit-sharing
agreement, collateral trust certificate, pre-organization cer-
tificate or subscription, transferable share, investment con-
tract, voting trust certificate, certificate of deposit for a
security, fractional undivided interest in oil, gas, or other
mineral rights, or, in general, any interest or instrument com-
monly known as a "security", or any certificate of interest or
participation in, temporary or interim certificate for, receipt
for, guarantee of, or warrant or right to subscribe to or pur-
chase, any of the foregoing.
(d) For the purposes of this Section:
(1) The term "underwriter" when used with reference
to the Company shall mean every person, who, within one
year prior to the time as of which the determination is
made, has purchased from the Company with a view to, or
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has offered or sold for the Company in connection with,
the distribution of any security of the Company outstand-
ing at such time, or has participated or has had a direct
or indirect participation in any such undertaking, or has
participated or has had a participation in the direct or
indirect underwriting of any such undertaking, but such
term shall not include a person whose interest was limited
to a commission from an underwriter or dealer not in ex-
cess of the usual and customary distributors' or sellers'
commission.
(2) The term "director" shall mean any member of the
board of directors of a corporation or any individual per-
forming similar functions with respect to any organization
whether incorporated or unincorporated.
(3) The term "person" shall mean an individual, a
corporation, a partnership, an association, a joint-stock
company, a trust, an unincorporated organization or a gov-
ernment or political subdivision thereof. As used in this
paragraph, the term "trust" shall include only a trust
where the interest or interests of the beneficiary or ben-
eficiaries are evidenced by a security.
(4) The term "voting security" shall mean any secu-
rity presently entitling the owner or holder thereof to
vote in the direction or management of the affairs of a
person, or any security issued under or pursuant to any
trust, agreement or arrangement whereby a trustee or
trustees or agent or agents for the owner or holder of
such security are presently entitled to vote in the direc-
tion or management of the affairs of a person.
(5) The term "Company" shall mean any obligor upon
the Debentures.
(6) The term "executive officer" shall mean the
chairman of the board of directors, president, every vice
president, every assistant vice president, every trust
officer, the cashier, the secretary, and the treasurer of
a corporation, and any individual customarily performing
similar functions with respect to any organization whether
incorporated or unincorporated.
(e) The percentages of voting securities and other
securities specified in this Section shall be calculated in
accordance with the following provisions:
(1) A specified percentage of the voting securities
of the Trustee, the Company or any other person referred
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to in this Section (each of whom is referred to as a "per-
son" in this paragraph) means such amount of the outstand-
ing voting securities of such person as entitles the
holder or holders thereof to cast such specified percent-
age of the aggregate votes which the holders of all the
outstanding voting securities of such person are entitled
to cast in the direction or management of the affairs of
such person.
(2) A specified percentage of a class of securities
of a person means such percentage of the aggregate amount
of securities of the class outstanding.
(3) The term "amount", when used in regard to secu-
rities, means the principal amount if relating to evi-
dences of indebtedness, the number of shares if relating
to capital shares, and the number of units if relating to
any other kind of security.
(4) The term "outstanding" means issued and not held
by or for the account of the issuer. The following secu-
rities shall not be deemed outstanding within the meaning
of this definition:
(i) securities of an issuer held in a sinking
fund relating to securities of the issuer of the same
class;
(ii) securities of an issuer held in a sinking
fund relating to another class of securities of the
issuer, if the obligation evidenced by such other
class of securities is not in default as to principal
or interest or otherwise;
(iii) securities pledged by the issuer thereof as
security for an obligation of the issuer not in de-
fault as to principal or interest or otherwise; and
(iv) securities held in escrow if placed in
escrow by the issuer thereof, provided, however, that
any voting securities of an issuer shall be deemed
outstanding if any person other than the issuer is
entitled to exercise the voting rights thereof.
(5) A security shall be deemed to be of the same
class as another security if both securities confer upon
the holder or holders thereof substantially the same
rights and privileges; provided, however, that, in the
case of secured evidences of indebtedness, all of which
are issued under a single indenture, differences in the
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interest rates or maturity dates of various series thereof
shall not be deemed sufficient to constitute such series
different classes; and provided, further, that, in the
case of unsecured evidences of indebtedness, differences
in the interest rates or maturity dates thereof shall not
be deemed sufficient to constitute them securities of dif-
ferent classes, whether or not they are issued under a
single indenture.
(f) Except in the case of a default in the payment
of the principal of (or premium, if any) or interest on any
Debentures issued under this Indenture, or in the payment of
any sinking or analogous fund installment, the Trustee shall
not be required to resign as provided by this Section 7.08 if
such Trustee shall have sustained the burden of proving, on
application to the Commission and after opportunity for hearing
thereon, that (i) the default under the Indenture may be cured
or waived during a reasonable period and under the procedures
described in such application and (ii) a stay of the Trustee's
duty to resign will not be inconsistent with the interests of
Debentureholders. The filing of such an application shall
automatically stay the performance of the duty to resign until
the Commission orders otherwise.
Any resignation of the Trustee shall become effective
only upon the appointment of a successor trustee and such suc-
cessor's acceptance of such an appointment.
SECTION 7.09. There shall at all times be a Trustee
with respect to the Debentures issued hereunder which shall at
all times be a corporation organized and doing business under
the laws of the United States of America or any State or Terri-
tory thereof or of the District of Columbia, or a corporation
or other person permitted to act as trustee by the Commission,
authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of at least 50 million
dollars, and subject to supervision or examination by Federal,
State, Territorial, or District of Columbia authority. If such
corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of the aforesaid super-
vising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set
forth in its most recent report of condition so published. The
Company may not, nor may any person directly or indirectly con-
trolling, controlled by, or under common control with the Com-
pany, serve as Trustee. In case at any time the Trustee shall
cease to be eligible in accordance with the provisions of this
Section, the Trustee shall resign immediately in the manner and
with the effect specified in Section 7.10.
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SECTION 7.10. (a) The Trustee or any successor
hereafter appointed, may at any time resign with respect to the
Debentures of one or more series by giving written notice
thereof to the Company and by transmitting notice of resigna-
tion by mail, first class postage prepaid, to the Debenture-
holders of such series, as their names and addresses appear
upon the Debenture Register. Upon receiving such notice of
resignation, the Company shall promptly appoint a successor
trustee with respect to Debentures of such series by written
instrument, in duplicate, executed by order of the Board of
Directors, one copy of which instrument shall be delivered to
the resigning Trustee and one copy to the successor trustee.
If no successor trustee shall have been so appointed and have
accepted appointment within 30 days after the mailing of such
notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a suc-
cessor trustee with respect to Debentures of such series, or
any Debentureholder of that series who has been a bona fide
holder of a Debenture or Debentures for at least six months
may, subject to the provisions of Section 6.08, on behalf of
himself and all others similarly situated, petition any such
court for the appointment of a successor trustee. Such court
may thereupon after such notice, if any, as it may deem proper
and prescribe, appoint a successor trustee.
(b) In case at any time any of the following shall
occur:
(1) the Trustee shall fail to comply with the provi-
sions of subsection (a) of Section 7.08 after written re-
quest therefor by the Company or by any Debentureholder
who has been a bona fide holder of a Debenture or Deben-
tures for at least six months; or
(2) the Trustee shall cease to be eligible in ac-
cordance with the provisions of Section 7.09 and shall
fail to resign after written request therefor by the Com-
pany or by any such Debentureholder; or
(3) the Trustee shall become incapable of acting, or
shall be adjudged a bankrupt or insolvent, or a receiver
of the Trustee or of its property shall be appointed, or
any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, then, in any
such case, the Company may remove the Trustee with respect
to all Debentures and appoint a successor trustee by writ-
ten instrument, in duplicate, executed by order of the
Board of Directors, one copy of which instrument shall be
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delivered to the Trustee so removed and one copy to the
successor trustee, or, subject to the provisions of Sec-
tion 6.08, unless the Trustee's duty to resign is stayed
as provided herein, any Debentureholder who has been a
bona fide holder of a Debenture or Debentures for at least
six months may, on behalf of himself and all others simi-
larly situated, petition any court of competent jurisdic-
tion for the removal of the Trustee and the appointment of
a successor trustee. Such court may thereupon after such
notice, if any, as it may deem proper and prescribe, re-
move the Trustee and appoint a successor trustee.
(c) The holders of a majority in aggregate principal
amount of the Debentures of any series at the time outstanding
may at any time remove the Trustee with respect to such series
and appoint a successor trustee.
(d) Any resignation or removal of the Trustee and
appointment of a successor trustee with respect to the Deben-
tures of a series pursuant to any of the provisions of this
Section shall become effective upon acceptance of appointment
by the successor trustee as provided in Section 7.11.
(e) Any successor trustee appointed pursuant to this
Section may be appointed with respect to the Debentures of one
or more series or all of such series, and at any time there
shall be only one Trustee with respect to the Debentures of any
particular series.
SECTION 7.11. (a) In case of the appointment here-
under of a successor trustee with respect to all Debentures,
every such successor trustee so appointed shall execute, ac-
knowledge and deliver to the Company and to the retiring
Trustee an instrument accepting such appointment, and thereupon
the resignation or removal of the retiring Trustee shall become
effective and such successor trustee, without any further act,
deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on the
request of the Company or the successor trustee, such retiring
Trustee shall, upon payment of its charges, execute and deliver
an instrument transferring to such successor trustee all the
rights, powers, and trusts of the retiring Trustee and shall
duly assign, transfer and deliver to such successor trustee all
property and money held by such retiring Trustee hereunder.
(b) In case of the appointment hereunder of a suc-
cessor trustee with respect to the Debentures of one or more
(but not all) series, the Company, the retiring Trustee and
each successor trustee with respect to the Debentures of one or
more series shall execute and deliver an indenture supplemental
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hereto wherein each successor trustee shall accept such ap-
pointment and which (1) shall contain such provisions as shall
be necessary or desirable to transfer and confirm to, and to
vest in, each successor trustee all the rights, powers, trusts
and duties of the retiring Trustee with respect to the Deben-
tures of that or those series to which the appointment of such
successor trustee relates, (2) shall contain such provisions as
shall be deemed necessary or desirable to confirm that all the
rights, powers, trusts and duties of the retiring Trustee with
respect to the Debentures of that or those series as to which
the retiring Trustee is not retiring shall continue to be
vested in the retiring Trustee, and (3) shall add to or change
any of the provisions of this Indenture as shall be necessary
to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that
nothing herein or in such supplemental indenture shall consti-
tute such Trustees co-trustees of the same trust, that each
such Trustee shall be trustee of a trust or trusts hereunder
separate and apart from any trust or trusts hereunder adminis-
tered by any other such Trustee and that no Trustee shall be
responsible for any act or failure to act on the part of any
other Trustee hereunder; and upon the execution and delivery of
such supplemental indenture the resignation or removal of the
retiring Trustee shall become effective to the extent provided
therein, such retiring Trustee shall with respect to the Deben-
tures of that or those series to which the appointment of such
successor trustee relates have no further responsibility for
the exercise of rights and powers or for the performance of the
duties and obligations vested in the Trustee under this Inden-
ture, and each such successor trustee, without any further act,
deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee with respect
to the Debentures of that or those series to which the appoint-
ment of such successor trustee relates; but, on request of the
Company or any successor trustee, such retiring Trustee shall
duly assign, transfer and deliver to such successor trustee, to
the extent contemplated by such supplemental indenture, the
property and money held by such retiring Trustee hereunder with
respect to the Debentures of that or those series to which the
appointment of such successor trustee relates.
(c) Upon request of any such successor trustee, the
Company shall execute any and all instruments for more fully
and certainly vesting in and confirming to such successor
trustee all such rights, powers and trusts referred to in para-
graph (a) or (b) of this Section, as the case may be.
(d) No successor trustee shall accept its appoint-
ment unless at the time of such acceptance such successor
trustee shall be qualified and eligible under this Article.
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(e) Upon acceptance of appointment by a successor
trustee as provided in this Section, the Company shall transmit
notice of the succession of such trustee hereunder by mail,
first class postage prepaid, to the Debentureholders, as their
names and addresses appear upon the Debenture Register. If the
Company fails to transmit such notice within ten days after
acceptance of appointment by the successor trustee, the succes-
sor trustee shall cause such notice to be transmitted at the
expense of the Company.
SECTION 7.12. Any corporation into which the Trustee
may be merged or converted or with which it may be consoli-
dated, or any corporation resulting from any merger, conversion
or consolidation to which the Trustee shall be a party, or any
corporation succeeding to the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, pro-
vided such corporation shall be qualified under the provisions
of Section 7.08 and eligible under the provisions of Section
7.09, without the execution or filing of any paper or any fur-
ther act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding. In case any Debentures
shall have been authenticated, but not delivered, by the
Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such
authentication and deliver the Debentures so authenticated with
the same effect as if such successor Trustee had itself authen-
ticated such Debentures.
SECTION 7.13. (a) Subject to the provisions of sub-
section (b) of this Section, if the Trustee shall be or shall
become a creditor, directly or indirectly, secured or unse-
cured, of the Company within three months prior to a default,
as defined in subsection (c) of this Section, or subsequent to
such a default, then, unless and until such default shall be
cured, the Trustee shall set apart and hold in a special ac-
count for the benefit of the Trustee individually, the holders
of the Debentures and the holders of other indenture securities
(as defined in subsection (c) of this Section):
(1) an amount equal to any and all reductions in the
amount due and owing upon any claim as such creditor in
respect of principal or interest, effected after the be-
ginning of such three months' period and valid as against
the Company and its other creditors, except any such re-
duction resulting from the receipt or disposition of any
property described in paragraph (2) of this subsection, or
from the exercise of any right of set-off which the Trust-
ee could have exercised if a petition in bankruptcy had
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been filed by or against the Company upon the date of such
default; and
(2) all property received by the Trustee in respect
of any claim as such creditor, either as security there-
for, or in satisfaction or composition thereof, or other-
wise, after the beginning of such three months' period, or
an amount equal to the proceeds of any such property, if
disposed of, subject, however, to the rights, if any, of
the Company and its other creditors in such property or
such proceeds.
Nothing herein contained, however, shall affect the
right of the Trustee:
(A) to retain for its own account (i) payments made
on account of any such claim by any person (other than the
Company) who is liable thereon, and (ii) the proceeds of
the bona fide sale of any such claim by the Trustee to a
third person, and (iii) distributions made in cash, secu-
rities, or other property in respect of claims filed
against the Company in bankruptcy or receivership or in a
case for reorganization pursuant to the Federal Bankruptcy
Code or applicable State law;
(B) to realize, for its own account, upon any prop-
erty held by it as security for any such claim, if such
property was so held prior to the beginning of such three
months' period;
(C) to realize, for its own account, but only to the
extent of the claim hereinafter mentioned, upon any prop-
erty held by it as security for any such claim, if such
claim was created after the beginning of such three
months' period and such property was received as security
therefor simultaneously with the creation thereof, and if
the Trustee shall sustain the burden of proving that at
the time such property was so received the Trustee had no
reasonable cause to believe that a default, as defined in
subsection (c) of this Section, would occur within three
months; or
(D) to receive payment on any claim referred to in
paragraph (B) or (C), against the release of any property
held as security for such claim as provided in such para-
graph (B) or (C), as the case may be, to the extent of the
fair value of such property.
For the purposes of paragraphs (B), (C) and (D),
property substituted after the beginning of such three months'
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period for property held as security at the time of such sub-
stitution shall, to the extent of the fair value of the prop-
erty released, have the same status as the property released,
and, to the extent that any claim referred to in any of such
paragraphs is created in renewal of or in substitution for or
for the purpose of repaying or refunding any pre-existing claim
of the Trustee as such creditor, such claim shall have the same
status as such pre-existing claim.
If the Trustee shall be required to account, the
funds and property held in such special account and the pro-
ceeds thereof shall be apportioned between the Trustee, the
Debentureholders and the holders of other indenture securities
in such manner that the Trustee, the Debentureholders and the
holders of other indenture securities realize, as a result of
payments from such special account and payments of dividends on
claims filed against the Company in bankruptcy or receivership
or in a case for reorganization pursuant to the Federal Bank-
ruptcy Code or applicable State law, the same percentage of
their respective claims, figured before crediting to the claim
of the Trustee anything on account of the receipt by it from
the Company of the funds and property in such special account
and before crediting to the respective claims of the Trustee,
the Debentureholders and the holders of other indenture securi-
ties dividends on claims filed against the Company in bank-
ruptcy or receivership or in a case for reorganization pursuant
to the Federal Bankruptcy Code or applicable State law, but
after crediting thereon receipts on account of the indebtedness
represented by their respective claims from all sources other
than from such dividends and from the funds and property so
held in such special account. As used in this paragraph, with
respect to any claim, the term "dividends" shall include any
distribution with respect to such claim, in bankruptcy or re-
ceivership or in a case for reorganization pursuant to the Fed-
eral Bankruptcy Code or applicable State law, whether such dis-
tribution is made in cash, securities, or other property, but
shall not include any such distribution with respect to the
secured portion, if any, of such claim. The court in which
such bankruptcy, receivership or a case for reorganization is
pending shall have jurisdiction (i) to apportion between the
Trustee, the Debentureholders and the holders of other inden-
ture securities, in accordance with the provisions of this
paragraph, the funds and property held in such special account
and the proceeds thereof, or (ii) in lieu of such apportion-
ment, in whole or in part, to give to the provisions of this
paragraph due consideration in determining the fairness of the
distributions to be made to the Trustee, the Debentureholders
and the holders of other indenture securities with respect to
their respective claims, in which event it shall not be neces-
sary to liquidate or to appraise the value of any securities or
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other property held in such special account or as security for
any such claim, or to make a specific allocation of such dis-
tributions as between the secured and unsecured portions of
such claims, or otherwise to apply the provisions of this para-
graph as a mathematical formula.
Any Trustee who has resigned or been removed after
the beginning of such three months' period shall be subject to
the provisions of this subsection (a) as though such resigna-
tion or removal had not occurred. If any Trustee has resigned
or been removed prior to the beginning of such three months'
period, it shall be subject to the provisions of this subsec-
tion (a) if and only if the following conditions exist:
(i) the receipt of property or reduction of claim
which would have given rise to the obligation to account,
if such Trustee had continued as trustee, occurred after
the beginning of such three months' period; and
(ii) such receipt of property or reduction of claim
occurred within three months after such resignation or
removal.
(b) There shall be excluded from the operation of
subsection (a) of this Section a creditor relationship arising
from:
(1) the ownership or acquisition of securities is-
sued under any indenture, or any security or securities
having a maturity of one year or more at the time of ac-
quisition by the Trustee;
(2) advances authorized by a receivership or bank-
ruptcy court of competent jurisdiction, or by this Inden-
ture, for the purpose of preserving any property other
than cash which shall at any time be subject to the lien,
if any, of this Indenture or of discharging tax liens or
other prior liens or encumbrances thereon, if notice of
such advance and of the circumstances surrounding the mak-
ing thereof is given to the Debentureholders at the time
and in the manner provided in this Indenture;
(3) disbursements made in the ordinary course of
business in the capacity of trustee under an indenture,
transfer agent, registrar, custodian, paying agent, sub-
scription agent, fiscal agent or depositary, or
other similar capacity;
(4) an indebtedness created as a result of services
rendered or premises rented; or an indebtedness created as
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a result of goods or securities sold in a cash transaction
as defined in subsection (c) of this Section;
(5) the ownership of stock or of other securities of
a Company organized under the provisions of Section 25(a)
of the Federal Reserve Act, as amended, which is directly
or indirectly a creditor of the Company; or
(6) the acquisition, ownership, acceptance or nego-
tiation of any drafts, bills of exchange, acceptances or
obligations which fall within the classification of self-
liquidating paper as defined in subsection (c) of this
Section.
(c) As used in this Section:
(1) The term "default" shall mean any failure to
make payment in full of the principal of (or premium, if
any) or interest upon any of the Debenture, or upon the
other indenture securities when and as such principal (or
premium, if any) or interest becomes due and payable.
(2) The term "other indenture securities" shall mean
securities upon which the Company is an obligor (as de-
fined in the Trust Indenture Act) outstanding under any
other indenture (A) under which the Trustee is also
trustee, (B) which contains provisions substantially simi-
lar to the provisions of subsection (a) of this Section,
and (C) under which a default exists at the time of the
apportionment of the funds and property held in said spe-
cial account.
(3) The term "cash transaction" shall mean any
transaction in which full payment for goods or securities
sold is made within seven days after delivery of the goods
or securities in currency or in checks or other orders
drawn upon banks or bankers and payable upon demand.
(4) The term "self-liquidating paper" shall mean any
draft, bill of exchange, acceptance or obligation which is
made, drawn, negotiated or incurred by the Company for the
purpose of financing the purchase, processing, manufac-
ture, shipment, storage or sale of goods, wares or mer-
chandise and which is secured by documents evidencing
title to, possession of, or a lien upon, the goods, wares
or merchandise or the receivables or proceeds arising from
the sale of the goods, wares or merchandise previously
constituting the security, provided the security is re-
ceived by the Trustee simultaneously with the creation of
the creditor relationship with the Company arising from
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the making, drawing, negotiating or incurring of the
draft, bill of exchange, acceptance or obligation.
(5) The term "Company" shall mean any obligor upon
any of the Debentures.
ARTICLE EIGHT
Concerning the Debentureholders
SECTION 8.01. Whenever in this Indenture it is pro-
vided that the holders of a majority or specified percentage in
aggregate principal amount of the Debentures of a particular
series may take any action (including the making of any demand
or request, the giving of any notice, consent or waiver or the
taking of any other action), the fact that at the time of tak-
ing any such action the holders of such majority or specified
percentage of that series have joined therein may be evidenced
by any instrument or any number of instruments of similar tenor
executed by such holders of Debentures of that series in person
or by agent or proxy appointed in writing.
If the Company shall solicit from the Debenturehold-
ers of any series any request, demand, authorization, direc-
tion, notice, consent, waiver or other action, the Company may,
at its option, as evidenced by an Officers' Certificate, fix in
advance a record date for such series for the determination of
Debentureholders entitled to give such request, demand, autho-
rization, direction, notice, consent, waiver or other action,
but the Company shall have no obligation to do so. If such a
record date is fixed, such request, demand, authorization,
direction, notice, consent, waiver or other action may be given
before or after the record date, but only the Debentureholders
of record at the close of business on the record date shall be
deemed to be Debentureholders for the purposes of determining
whether Debentureholders of the requisite proportion of out-
standing Debentures of that series have authorized or agreed or
consented to such request, demand, authorization, direction,
notice, consent, waiver or other action, and for that purpose
the outstanding Debentures of that series shall be computed as
of the record date; provided that no such authorization, agree-
ment or consent by such Debentureholders on the record date
shall be deemed effective unless it shall become effective pur-
suant to the provisions of this Indenture not later than six
months after the record date.
SECTION 8.02. Subject to the provisions of Section
7.01, proof of the execution of any instrument by a Debenture-
holder (such proof will not require notarization) or his agent
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or proxy and proof of the holding by any person of any of the
Debentures shall be sufficient if made in the following manner:
(a) The fact and date of the execution by any such
person of any instrument may be proved in any reasonable
manner acceptable to the Trustee.
(b) The ownership of Debentures shall be proved by
the Debenture Register of such Debentures or by a certifi-
cate of the Debenture Registrar thereof.
(c) The Trustee may require such additional proof of
any matter referred to in this Section as it shall deem
necessary.
SECTION 8.03. Prior to the due presentment for reg-
istration of transfer of any Debenture, the Company, the Trust-
ee, any paying agent and any Debenture Registrar may deem and
treat the person in whose name such Debenture shall be reg-
istered upon the books of the Company as the absolute owner of
such Debenture (whether or not such Debenture shall be overdue
and notwithstanding any notice of ownership or writing thereon
made by anyone other than the Debenture Registrar) for the pur-
pose of receiving payment of or on account of the principal of,
premium, if any, and (subject to Section 2.03) interest on such
Debenture and for all other purposes; and neither the Company
nor the Trustee nor any paying agent nor any Debenture Regis-
trar shall be affected by any notice to the contrary.
SECTION 8.04. At any time when any Debentures are
held by any holder other than Transamerica Delaware, in
determining whether the holders of the requisite aggregate
principal amount of Debentures of aparticular series have
concurred in any direction, consent or waiver under this
Indenture, Debentures of that series which are owned by the
Company or any other obligor on the Debentures of that series
or by any person directly or indirectly controlling or controlled
by or under common control with the Company or any other obligor
on the Debentures of that series shall be disregarded and deemed
not to be outstanding for the purpose of any such determination,
except that for the purpose of determining whether the Trustee
shall be protected in relying on any such direction, consent or
waiver, only Debentures of such series which the Trustee actually
knows are so owned shall be so disregarded. Debentures so owned
which have been pledged in good faith may be regarded as out-
standing for the purposes of this Section, if the pledgee shall
establish to the satisfaction of the Trustee the pledgee's right
so to act with respect to such Debentures and that the pledgee
is not a person directly or indirectly controlling or controlled
by or under direct or indirect common control with the Company
or any such
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other obligor. In case of a dispute as to such right, any deci-
sion by the Trustee taken upon the advice of counsel shall be
full protection to the Trustee.
SECTION 8.05. At any time prior to (but not after)
the evidencing to the Trustee, as provided in Section 8.01, of
the taking of any action by the holders of the majority or per-
centage in aggregate principal amount of the Debentures of a
particular series specified in this Indenture in connection
with such action, any holder of a Debenture of that series
which is shown by the evidence to be included in the Debentures
the holders of which have consented to such action may, by fil-
ing written notice with the Trustee, and upon proof of holding
as provided in Section 8.02, revoke such action so far as con-
cerns such Debenture. Except as aforesaid any such action
taken by the holder of any Debenture shall be conclusive and
binding upon such holder and upon all future holders and owners
of such Debenture, and of any Debenture issued in exchange
therefor, on registration of transfer thereof or in place
thereof, irrespective of whether or not any notation in regard
thereto is made upon such Debenture. Any action taken by the
holders of the majority or percentage in aggregate principal
amount of the Debentures of a particular series specified in
this Indenture in connection with such action shall be conclu-
sively binding upon the Company, the Trustee and the holders of
all the Debentures of that series.
ARTICLE NINE
Supplemental Indentures
SECTION 9.01. In addition to any supplemental inden-
ture otherwise authorized by this Indenture, the Company, when
authorized by a Board Resolution, and the Trustee may from time
to time and at any time enter into an indenture or indentures
supplemental hereto (which shall conform to the provisions of
the Trust Indenture Act as then in effect), without the consent
of the Debentureholders, for one or more of the following pur-
poses:
(a) to evidence the succession of another corpora-
tion to the Company, and the assumption by any such suc-
cessor of the covenants of the Company contained herein or
otherwise established with respect to the Debentures; or
(b) to add to the covenants of the Company such fur-
ther covenants, restrictions, conditions or provisions for
the protection of the holders of the Debentures of all or
any series as the Board of Directors and the Trustee shall
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consider to be for the protection of the holders of Deben-
tures of all or any series, and to make the occurrence, or
the occurrence and continuance, of a default in any of
such additional covenants, restrictions, conditions or
provisions a default or an Event of Default with respect
to such series permitting the enforcement of all or any of
the several remedies provided in this Indenture as herein
set forth; provided, however, that in respect of any such
additional covenant, restriction, condition or provision
such supplemental indenture may provide for a particular
period of grace after default (which period may be shorter
or longer than that allowed in the case of other defaults)
or may provide for an immediate enforcement upon such de-
fault or may limit the remedies available to the Trustee
upon such default or may limit the right of the holders of
a majority in aggregate principal amount of the Debentures
of such series to waive such default; or
(c) to cure any ambiguity or to correct or supple-
ment any provision contained herein or in any supplemental
indenture which may be defective or inconsistent with any
other provision contained herein or in any supplemental
indenture, or to make such other provisions in regard to
matters or questions arising under this Indenture as shall
not be inconsistent with the provisions of this Indenture
and shall not adversely affect the interests of the hold-
ers of the Debentures of any series; or
(d) to change or eliminate any of the provisions of
this Indenture, provided that any such change or elimina-
tion shall become effective only when there is no Deben-
ture outstanding of any series created prior to the execu-
tion of such supplemental indenture which is entitled to
the benefit of such provision.
The Trustee is hereby authorized to join with the
Company in the execution of any such supplemental indenture,
and to make any further appropriate agreements and stipulations
which may be therein contained, but the Trustee shall not be
obligated to enter into any such supplemental indenture which
affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise.
Any supplemental indenture authorized by the provi-
sions of this Section may be executed by the Company and the
Trustee without the consent of the holders of any of the Deben-
tures at the time outstanding, notwithstanding any of the pro-
visions of Section 9.02.
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SECTION 9.02. With the consent (evidenced as pro-
vided in Section 8.01) of the holders of not less than a major-
ity in aggregate principal amount of the Debentures of each
series affected by such supplemental indenture or indentures at
the time outstanding, the Company, when authorized by a Board
Resolution, and the Trustee may from time to time and at any
time enter into an indenture or indentures supplemental hereto
(which shall conform to the provisions of the Trust Indenture
Act as then in effect) for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provi-
sions of this Indenture or of any supplemental indenture or of
modifying in any manner the rights of the holders of the Deben-
tures of such series under this Indenture; provided, however,
that no such supplemental indenture shall (i) extend the fixed
maturity of any Debentures of any series, or reduce the princi-
pal 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 Debenture so affected or (ii) reduce the aforesaid per-
centage of Debentures, the holders of which are required to
consent to any such supplemental indenture, without the consent
of the holders of each Debenture then outstanding and affected
thereby.
Upon the request of the Company, accompanied by a
Board Resolution authorizing the execution of any such supple-
mental indenture, and upon the filing with the Trustee of evi-
dence of the consent of Debentureholders required to consent
thereto as aforesaid, the Trustee shall join with the Company
in the execution of such supplemental indenture unless such
supplemental indenture affects the Trustee's own rights, duties
or immunities under this Indenture or otherwise, in which case
the Trustee may in its discretion but shall not be obligated to
enter into such supplemental indenture.
It shall not be necessary for the consent of the
Debentureholders of any series affected thereby under this Sec-
tion to approve the particular form of any proposed supplemen-
tal indenture, but it shall be sufficient if such consent shall
approve the substance thereof.
Promptly after the execution by the Company and the
Trustee of any supplemental indenture pursuant to the provi-
sions of this Section, the Trustee shall transmit by mail,
first class postage prepaid, a notice, setting forth in general
terms the substance of such supplemental indenture, to the
Debentureholders of all series affected thereby as their names
and addresses appear upon the Debenture Register. Any failure
of the Trustee to mail such notice, or any defect therein,
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shall not, however, in any way impair or affect the validity of
any such supplemental indenture.
SECTION 9.03. Upon the execution of any supplemental
indenture pursuant to the provisions of this Article or of Sec-
tion 10.01, this Indenture shall, with respect to such series,
be and be deemed to be modified and amended in accordance
therewith and the respective rights, limitations of rights,
obligations, duties and immunities under this Indenture of the
Trustee, the Company and the holders of Debentures of the se-
ries affected thereby shall thereafter be determined, exercised
and enforced hereunder subject in all respects to such modifi-
cations and amendments, and all the terms and conditions of any
such supplemental indenture shall be and be deemed to be part
of the terms and conditions of this Indenture for any and all
purposes.
SECTION 9.04. Debentures of any series, affected by
a supplemental indenture, authenticated and delivered after the
execution of such supplemental indenture pursuant to the provi-
sions of this Article or of Section 10.01, may bear a notation
in form approved by the Company, provided such form meets the
requirements of any exchange upon which such series may be
listed, as to any matter provided for in such supplemental in-
denture. If the Company shall so determine, new Debentures of
that series so modified as to conform, in the opinion of the
Board of Directors, to any modification of this Indenture con-
tained in any such supplemental indenture may be prepared by
the Company, authenticated by the Trustee and delivered in ex-
change for the Debentures of that series then outstanding.
SECTION 9.05. The Trustee, subject to the provisions
of Section 7.01, may receive an Opinion of Counsel as conclu-
sive evidence that any supplemental indenture executed pursuant
to this Article is authorized or permitted by, and conforms to,
the terms of this Article and that it is proper for the Trustee
under the provisions of this Article to join in the execution
thereof.
ARTICLE TEN
Consolidation, Merger and Sale
SECTION 10.01. Nothing contained in this Indenture
or in any of the Debentures shall prevent any consolidation or
merger of the Company with or into any other corporation or
corporations (whether or not affiliated with the Company), or
successive consolidations or mergers in which the Company or
its successor or successors shall be a party or parties, or
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shall prevent any sale, conveyance, transfer or other disposi-
tion of the property of the Company or its successor or succes-
sors as an entirety, or substantially as an entirety, to any
other corporation (whether or not affiliated with the Company
or its successor or successors) authorized to acquire and oper-
ate the same; provided, however, the Company hereby covenants
and agrees that, upon any such consolidation, merger, sale,
conveyance, transfer or other disposition, the due and punctual
payment of the principal of (premium, if any) and interest on
all of the Debentures of all series in accordance with the
terms of each series, according to their tenor, and the due and
punctual performance and observance of all the covenants and
conditions of this Indenture with respect to each series or
established with respect to such series pursuant to Section
2.01 to be kept or performed by the Company, shall be expressly
assumed, by supplemental indenture (which shall conform to the
provisions of the Trust Indenture Act, as then in effect) sat-
isfactory in form to the Trustee executed and delivered to the
Trustee by the entity formed by such consolidation, or into
which the Company shall have been merged, or by the entity
which shall have acquired such property.
SECTION 10.02. (a) In case of any such consolida-
tion, merger, sale, conveyance, transfer or other disposition
and upon the assumption by the successor corporation, by sup-
plemental indenture, executed and delivered to the Trustee and
satisfactory in form to the Trustee, of the due and punctual
payment of the principal of, premium, if any, and interest on
all of the Debentures of all series outstanding and the due and
punctual performance of all of the covenants and conditions of
this Indenture or established with respect to each series of
the Debentures pursuant to Section 2.01 to be performed by the
Company with respect to each series, such successor corporation
shall succeed to and be substituted for the Company, with the
same effect as if it had been named herein as the party of the
first part, and thereupon the predecessor corporation shall be
relieved of all obligations and covenants under this Indenture
and the Debentures. Such successor corporation thereupon may
cause to be signed, and may issue either in its own name or in
the name of the Company or any other predecessor obligor on the
Debentures, any or all of the Debentures issuable hereunder
which theretofore shall not have been signed by the Company and
delivered to the Trustee; and, upon the order of such successor
company, instead of the Company, and subject to all the terms,
conditions and limitations in this Indenture prescribed, the
Trustee shall authenticate and shall deliver any Debentures
which previously shall have been signed and delivered by the
officers of the predecessor Company to the Trustee for authen-
tication, and any Debentures which such successor corporation
thereafter shall cause to be signed and delivered to the
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Trustee for that purpose. All the Debentures so issued shall
in all respects have the same legal rank and benefit under this
Indenture as the Debentures theretofore or thereafter issued in
accordance with the terms of this Indenture as though all of
such Debentures had been issued at the date of the execution
hereof.
(b) In case of any such consolidation, merger, sale,
conveyance, transfer or other disposition such changes in
phraseology and form (but not in substance) may be made in the
Debentures thereafter to be issued as may be appropriate.
(c) Nothing contained in this Indenture or in any of
the Debentures shall prevent the Company from merging into it-
self or acquiring by purchase or otherwise all or any part of
the property of any other corporation (whether or not affili-
ated with the Company).
SECTION 10.03. The Trustee, subject to the provi-
sions of Section 7.01, may receive an Opinion of Counsel as
conclusive evidence that any such consolidation, merger, sale,
conveyance, transfer or other disposition, and any such assump-
tion, comply with the provisions of this Article.
ARTICLE ELEVEN
Satisfaction and Discharge of Indenture;
Unclaimed Moneys
SECTION 11.01. If at any time: (a) the Company
shall have delivered to the Trustee for cancellation all Deben-
tures of a series theretofore authenticated (other than any
Debentures which shall have been destroyed, lost or stolen and
which shall have been replaced or paid as provided in Section
2.07) and Debentures for whose payment money or Governmental
Obligations have theretofore been deposited in trust or segre-
gated and held in trust by the Company (and thereupon repaid to
the Company or discharged from such trust, as provided in Sec-
tion 11.05); or (b) all such Debentures of a particular series not
theretofore delivered to the Trustee for cancellation shall
have become due and payable, or are by their terms to become
due and payable within one year or are to be called for redemp-
tion within one year under arrangements satisfactory to the
Trustee for the giving of notice of redemption, and the Company
shall deposit or cause to be deposited with the Trustee as
trust funds the entire amount in moneys or Governmental Obliga-
tions or a combination thereof, sufficient in the opinion of a
nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the
Trustee, to pay at maturity or upon redemption
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all Debentures of that series not theretofore delivered to the
Trustee for cancellation, including principal (and premium, if
any) and interest due or to become due to such date of maturity
or date fixed for redemption, as the case may be, and if the
Company shall also pay or cause to be paid all other sums pay-
able hereunder with respect to such series by the Company then
this Indenture shall thereupon cease to be of further effect
with respect to such series except for the provisions of Sec-
tions 2.05, 2.07, 4.02 and 7.10, which shall survive until the
date of maturity or redemption date, as the case may be, and
Sections 7.06 and 11.05 which shall survive to such date and
thereafter, and the Trustee, on demand of the Company and at
the cost and expense of the Company, shall execute proper in-
struments acknowledging satisfaction of and discharging this
Indenture with respect to such series.
SECTION 11.02. If at any time all such Debentures of
a particular series not heretofore delivered to the Trustee for
cancellation or which have not become due and payable as de-
scribed in Section 11.01 shall have been paid by the Company by
depositing irrevocably with the Trustee as trust funds moneys
or an amount of Governmental Obligations sufficient to pay at
maturity or upon redemption all such Debentures of that series
not theretofore delivered to the Trustee for cancellation, in-
cluding principal (and premium, if any) and interest due or to
become due to such date of maturity or date fixed for redemp-
tion, as the case may be, and if the Company shall also pay or
cause to be paid all other sums payable hereunder by the Com-
pany with respect to such series, then after the date such mon-
eys or Governmental Obligations, as the case may be, are depos-
ited with the Trustee the obligations of the Company under this
Indenture with respect to such series shall cease to be of fur-
ther effect except for the provisions of Sections 2.05, 2.07,
4.02, 7.06, 7.10 and 11.05 hereof which shall survive until
such Debentures shall mature and be paid. Thereafter, Sections
7.06 and 11.05 shall survive.
SECTION 11.03. All moneys or Governmental Obliga-
tions deposited with the Trustee pursuant to Sections 11.01 or
11.02 shall be held in trust and shall be available for payment
as due, either directly or through any paying agent (including
the Company acting as its own paying agent), to the holders of
the particular series of Debentures for the payment or redemp-
tion of which such moneys or Governmental Obligations have been
deposited with the Trustee.
SECTION 11.04. In connection with the satisfaction
and discharge of this Indenture all moneys or Governmental Ob-
ligations then held by any paying agent under the provisions of
this Indenture shall, upon demand of the Company, be paid to
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the Trustee and thereupon such paying agent shall be released
from all further liability with respect to such moneys or Gov-
ernmental Obligations.
SECTION 11.05. Any moneys or Governmental Obliga-
tions deposited with any paying agent or the Trustee, or then
held by the Company, in trust for payment of principal of or
premium or interest on the Debentures of a particular series
that are not applied but remain unclaimed by the holders of
such Debentures for at least two years after the date upon
which the principal of (and premium, if any) or interest on
such Debentures shall have respectively become due and payable,
shall be repaid to the Company on May 31 of each year or (if
then held by the Company) shall be discharged from such trust;
and thereupon the paying agent and the Trustee shall be re-
leased from all further liability with respect to such moneys
or Governmental Obligations, and the holder of any of the
Debentures entitled to receive such payment shall thereafter,
as an unsecured general creditor, look only to the Company for
the payment thereof.
ARTICLE TWELVE
Immunity of Incorporators, Stockholders, Officers
and Directors
SECTION 12.01. No recourse under or upon any obliga-
tion, covenant or agreement of this Indenture, or of any De-
benture, or for any claim based thereon or otherwise in respect
thereof, shall be had against any incorporator, stockholder,
officer or director, past, present or future as such, of the
Company or of any predecessor or successor corporation, either
directly or through the Company or any such predecessor or suc-
cessor corporation, whether by virtue of any constitution,
statute or rule of law, or by the enforcement of any assessment
or penalty or otherwise; it being expressly understood that
this Indenture and the obligations issued hereunder are solely
corporate obligations, and that no such personal liability
whatever shall attach to, or is or shall be incurred by, the
incorporators, stockholders, officers or directors as such, of
the Company or of any predecessor or successor corporation, or
any of them, because of the creation of the indebtedness hereby
authorized, or under or by reason of the obligations, covenants
or agreements contained in this Indenture or in any of the De-
bentures or implied therefrom; and that any and all such per-
sonal liability of every name and nature, either at common law
or in equity or by constitution or statute, of, and any and all
such rights and claims against, every such incorporator, stock-
holder, officer or director as such, because of the creation of
the indebtedness hereby authorized, or under or by reason of
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the obligations, covenants or agreements contained in this In-
denture or in any of the Debentures or implied therefrom, are
hereby expressly waived and released as a condition of, and as
a consideration for, the execution of this Indenture and the
issuance of such Debentures.
ARTICLE THIRTEEN
Miscellaneous Provisions
SECTION 13.01. All the covenants, stipulations,
promises and agreements in this Indenture contained by or on
behalf of the Company shall bind its successors and assigns,
whether so expressed or not.
SECTION 13.02. Any act or proceeding by any provi-
sion of this Indenture authorized or required to be done or
performed by any board, committee or officer of the Company
shall and may be done and performed with like force and effect
by the corresponding board, committee or officer of any corpo-
ration that shall at the time be the lawful sole successor of
the Company.
SECTION 13.03. The Company by instrument in writing
executed by authority of two-thirds of its Board of Directors
and delivered to the Trustee may surrender any of the powers
reserved to the Company and thereupon such power so surrendered
shall terminate both as to the Company and as to any successor
corporation.
SECTION 13.04. Except as otherwise expressly pro-
vided herein any notice or demand which by any provision of
this Indenture is required or permitted to be given or served
by the Trustee or by the holders of Debentures to or on the
Company may be given or served by being deposited first class
postage prepaid in a post-office letterbox addressed (until
another address is filed in writing by the Company with the
Trustee), as follows: Transamerica Corporation, 600 Montgomery
Street, San Francisco, California 94111, Attention: Secretary.
Any notice, election, request or demand by the Company or any
Debentureholder to or upon the Trustee shall be deemed to have
been sufficiently given or made, for all purposes, if given or
made in writing at the Corporate Trust Office of the Trustee.
SECTION 13.05. This Indenture and each Debenture
shall be deemed to be a contract made under the laws of the
State of New York, and for all purposes shall be construed in
accordance with the laws of said State.
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SECTION 13.06. (a) Upon any application or demand
by the Company to the Trustee to take any action under any of
the provisions of this Indenture, the Company shall furnish to
the Trustee an Officers' Certificate stating that all condi-
tions precedent provided for in this Indenture relating to the
proposed action have been complied with and an Opinion of Coun-
sel stating that in the opinion of such counsel all such condi-
tions precedent have been complied with, except that in the
case of any such application or demand as to which the furnish-
ing of such documents is specifically required by any provision
of this Indenture relating to such particular application or
demand, no additional certificate or opinion need be furnished.
(b) Each certificate or opinion provided for in this
Indenture and delivered to the Trustee with respect to compli-
ance with a condition or covenant in this Indenture (other than
the certificate provided pursuant to Section 5.03(d) of this
Indenture) shall include (1) a statement that the person making
such certificate or opinion has read such covenant or condi-
tion; (2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opin-
ions contained in such certificate or opinion are based; (3) a
statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant
or condition has been complied with; and (4) a statement as to
whether or not, in the opinion of such person, such condition
or covenant has been complied with.
SECTION 13.07. Except as provided pursuant to Sec-
tion 2.01 pursuant to a Board Resolution, and as set forth in
an Officers' Certificate, or established in one or more inden-
tures supplemental to this Indenture, in any case where the date
of maturity of interest or principal of any Debenture or the
date of redemption of any Debenture shall not be a business day,
then payment of interest or principal (and premium, if any) may
be made on the next succeeding business day with the same force
and effect as if made on the nominal date of maturity or re-
demption, and no interest shall accrue for the period after
such nominal date.
SECTION 13.08. If and to the extent that any provi-
sion of this Indenture limits, qualifies or conflicts with the
duties imposed by Sections 310 to 317, inclusive, of the Trust
Indenture Act, such imposed duties shall control.
SECTION 13.09. This Indenture may be executed in any
number of counterparts, each of which shall be an original; but
such counterparts shall together constitute but one and the
same instrument.
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SECTION 13.10. In case any one or more of the provi-
sions contained in this Indenture or in the Debentures of any
series shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of this
Indenture or of such Debentures, but this Indenture and such
Debentures shall be construed as if such invalid or illegal or
unenforceable provision had never been contained herein or
therein.
SECTION 13.11. The Company will have the right at
all times to assign any of its rights or obligations under this
Indenture to a direct or indirect wholly owned Subsidiary of
the Company; provided that, in the event of any such assign-
ment, the Company will remain liable for all such obligations.
Subject to the foregoing, the Indenture is binding upon and
inures to the benefit of the parties thereto and their respec-
tive successors and assigns. This Indenture may not otherwise
be assigned by the parties thereto.
ARTICLE FOURTEEN
Subordination of Debentures
SECTION 14.01. The Company covenants and agrees, and
each holder of Debentures issued hereunder by his acceptance
thereof likewise covenants and agrees, that all Debentures
shall be issued subject to the provisions of this Article Four-
teen; and each holder of a Debenture, whether upon original
issue or upon transfer or assignment thereof, accepts and
agrees to be bound by such provisions.
The payment of the principal of, premium, if any, and
interest on all Debentures issued hereunder shall, to the ex-
tent and in the manner hereinafter set forth, be subordinated
and subject in right of payment to the prior payment in full of
all Senior Indebtedness, whether outstanding at the date of
this Indenture or thereafter incurred.
No provision of this Article Fourteen shall prevent
the occurrence of any default or Event of Default hereunder.
SECTION 14.02. In the event and during the continua-
tion of any default in the payment of principal, premium, in-
terest or any other payment due on any Senior Indebtedness or
in the event that the maturity of any Senior Indebtedness has
been accelerated because of a default, then, in either case, no
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payment shall be made by the Company with respect to the prin-
cipal (including redemption and sinking fund payments) of, or
premium, if any, or interest on the Debentures.
In the event that, notwithstanding the foregoing, any
payment shall be received by the Trustee or any holder when
such payment is prohibited by the preceding paragraph of this
Section 14.02, such payment shall be held in trust for the ben-
efit of, and shall be paid over or delivered to, the holders of
Senior Indebtedness or their respective representatives, or to
the trustee or trustees under any indenture pursuant to which
any of such Senior Indebtedness may have been issued, as their
respective interests may appear, but only to the extent that
the holders of the Senior Indebtedness (or their representative
or representatives or a trustee) notify the Trustee within 90
days of such payment of the amounts then due and owing on the
Senior Indebtedness and only the amounts specified in such no-
tice to the Trustee shall be paid to the holders of Senior In-
debtedness.
SECTION 14.03. Upon any payment by the Company, or
distribution of assets of the Company of any kind or character,
whether in cash, property or securities, to creditors upon any
dissolution or winding-up or liquidation or reorganization of
the Company, whether voluntary or involuntary or in bankruptcy,
insolvency, receivership or other proceedings, all amounts due
upon all Senior Indebtedness shall first be paid in full, or
payment thereof provided for in money in accordance with its
terms, before any payment is made on account of the principal
(and premium, if any) or interest on the Debentures; and upon
any such dissolution or winding-up or liquidation or reorgani-
zation any payment by the Company, or distribution of assets of
the Company of any kind or character, whether in cash, property
or securities, to which the holders of the Debenture or the
Trustee would be entitled, except for the provisions of this
Article Fourteen, shall by paid by the Company or by any re-
ceiver, trustee in bankruptcy, liquidating trustee, agent or
other person making such payment or distribution, or by the
holders of the Debentures or by the Trustee under this Inden-
ture if received by them or it, directly to the holders of
Senior Indebtedness (pro rata to such holders on the basis of
the respective amounts of Senior Indebtedness held by such
holders, as calculated by the Company) or their representative
or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any
Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay all Senior
Indebtedness in full, in money or money's worth, after giving
effect to any concurrent payment or distribution to or for the
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holders of Senior Indebtedness, before any payment or distribu-
tion is made to the holders of Debentures or to the Trustee.
In the event that, notwithstanding the foregoing, any
payment or distribution of assets of the Company of any kind or
character, whether in cash, property or securities, prohibited
by the foregoing, shall be received by the Trustee or the hold-
ers of the Debentures before all Senior Indebtedness is paid in
full, or provision is made for such payment in money in ac-
cordance with its terms, such payment or distribution shall be
held in trust for the benefit of and shall be paid over or de-
livered to the holders of Senior Indebtedness or their repre-
sentative or representatives, or to the trustee or trustees
under any indenture pursuant to which any instruments evidenc-
ing any Senior Indebtedness may have been issued, as their re-
spective interests may appear, as calculated by the Company,
for application to the payment of all Senior Indebtedness re-
maining unpaid to the extent necessary to pay all Senior In-
debtedness in full in money in accordance with its terms, after
giving effect to any concurrent payment or distribution to or
for the holders of such Senior Indebtedness.
For purposes of this Article Fourteen, the words
"cash, property or securities" shall not be deemed to include
shares of stock of the Company as reorganized or readjusted, or
securities of the Company or any other corporation provided for
by a plan of reorganization or readjustment, the payment of
which is subordinated at least to the extent provided in this
Article Fourteen with respect to the Debentures to the payment
of all Senior Indebtedness which may at the time be outstand-
ing; provided that (i) the Senior Indebtedness is assumed by
the new corporation, if any, resulting from any such reorgani-
zation or readjustment, and (ii) the rights of the holders of
the Senior Indebtedness are not, without the consent of such
holders, altered by such reorganization or readjustment. The
consolidation of the Company with, or the merger of the Company
into, another corporation or the liquidation or dissolution of
the Company following the conveyance or transfer of its prop-
erty as an entirety, or substantially as an entirety, to
another corporation upon the terms and conditions provided for
in Article Ten hereof shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the purposes of
this Section 14.03 if such other corporation shall, as a part
of such consolidation, merger, conveyance or transfer, comply
with the conditions stated in Article Ten hereof. Nothing in
Section 14.02 or in this Section 14.03 shall apply to claims
of, or payments to, the Trustee under or pursuant to Section
7.06.
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SECTION 14.04. Subject to the payment in full of all
Senior Indebtedness, the rights of the holders of the Deben-
tures shall be subrogated to the rights of the holders of Se-
nior Indebtedness to receive payments or distributions of cash,
property or securities of the Company applicable to the Senior
Indebtedness until the principal of (and premium, if any) and
interest on the Debentures shall be paid in full; and, for the
purposes of such subrogation, no payments or distributions to
the holders of the Senior Indebtedness of any cash, property or
securities to which the holders of the Debentures or the Trust-
ee would be entitled except for the provisions of this Article
Fourteen, and no payment over pursuant to the provisions of
this Article Fourteen, to or for the benefit of the holders of
Senior Indebtedness by holders of the Debentures or the Trust-
ee, shall, as between the Company, its creditors other than
holders of Senior Indebtedness, and the holders of the Deben-
tures, be deemed to be a payment by the Company to or on ac-
count of the Senior Indebtedness. It is understood that the
provisions of this Article Fourteen are and are intended solely
for the purposes of defining the relative rights of the holders
of the Debentures, on the one hand, and the holders of the Se-
nior Indebtedness on the other hand.
Nothing contained in this Article Fourteen or else-
where in this Indenture or in the Debentures is intended to or
shall impair, as between the Company, its creditors other than
the holders of Senior Indebtedness, and the holders of the De-
bentures, the obligation of the Company, which is absolute and
unconditional, to pay to the holders of the Debentures the
principal of (and premium, if any) and interest on the Deben-
tures as and when the same shall become due and payable in ac-
cordance with their terms, or is intended to or shall affect
the relative rights of the holders of the Debentures and credi-
tors of the Company other than the holders of the Senior In-
debtedness, nor shall anything herein or therein prevent the
Trustee or the holder of any Debenture from exercising all rem-
edies otherwise permitted by applicable law upon default under
this Indenture, subject to the rights, if any, under this Ar-
ticle Fourteen of the holders of Senior Indebtedness in respect
of cash, property or securities of the Company received upon
the exercise of any such remedy.
Upon any payment or distribution of assets of the
Company referred to in this Article Fourteen, the Trustee, sub-
ject to the provisions of Section 7.01, and the holders of the
Debentures, shall be entitled to rely upon any order or decree
made by any court of competent jurisdiction in which such dis-
solution, winding-up, liquidation or reorganization proceedings
are pending, or a certificate of the receiver, trustee in bank-
ruptcy, liquidation trustee, agent or other person making such
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<PAGE> 89
payment or distribution, delivered to the Trustee or to the
holders of the Debentures, for the purposes of ascertaining the
persons entitled to participate in such distribution, the hold-
ers of the Senior Indebtedness and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or
amounts paid or distributed thereon and all other facts perti-
nent thereto or to this Article Fourteen.
SECTION 14.05. Each holder of a Debenture by acceptance
thereof authorizes and directs the Trustee on such holder's behalf
to take such action as may be necessary or appropriate to effectuate
the subordination provided in this Article Fourteen and appoints
the Trustee such holder's attorney-in-fact for any and all such
purposes.
SECTION 14.06. The Company shall give prompt written
notice to a Responsible Officer of the Trustee of any fact
known to the Company which would prohibit the making of any
payment of monies to or by the Trustee in respect of the Deben-
tures pursuant to the provisions of this Article Fourteen.
Notwithstanding the provisions of this Article Fourteen or any
other provision of this Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts which
would prohibit the making of any payment of monies to or by the
Trustee in respect of the Debentures pursuant to the provisions
of this Article Fourteen, unless and until a Responsible Of-
ficer of the Trustee shall have received written notice thereof
at the Principal Office of the Trustee from the Company or a
holder or holders of Senior Indebtedness or from any trustee
therefor; and before the receipt of any such written notice,
the Trustee, subject to the provisions of Section 7.01, shall
be entitled in all respects to assume that no such facts exist;
provided that if the Trustee shall not have received the notice
provided for in this Section 14.06 at least two business days
prior to the date upon which by the terms hereof any money may
become payable for any purpose (including, without limitation,
the payment of the principal of (or premium, if any) or inter-
est on any Debenture), then, anything herein contained to the
contrary notwithstanding, the Trustee shall have full power and
authority to receive such money and to apply the same to the
purposes for which they were received, and shall not be af-
fected by any notice to the contrary which may be received by
it within two business days prior to such date.
The Trustee, subject to the provisions of Section
7.01, shall be entitled to rely on the delivery to it of a
written notice by a person representing himself to be a holder
of Senior Indebtedness (or a trustee on behalf of such holder)
to establish that such notice has been given by a holder of
Senior Indebtedness or a trustee on behalf of any such holder
-75-
<PAGE> 90
or holders. In the event that the Trustee determines in good
faith that further evidence is required with respect to the
right of any person as a holder of Senior Indebtedness to par-
ticipate in any payment or distribution pursuant to this Ar-
ticle Fourteen, the Trustee may request such person to furnish
evidence to the reasonable satisfaction of the Trustee as to
the amount of Senior Indebtedness held by such person, the ex-
tent to which such person is entitled to participate in such
payment or distribution and any other facts pertinent to the
rights of such person under this Article Fourteen, and if such
evidence is not furnished the Trustee may defer any payment to
such person pending judicial determination as to the right of
such person to receive such payment.
SECTION 14.07. The Trustee in its individual capac-
ity shall be entitled to all the rights set forth in this Arti-
cle Fourteen in respect of any Senior Indebtedness at any time
held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the
Trustee of any of its rights as such holder.
With respect to the holders of Senior Indebtedness,
the Trustee undertakes to perform or to observe only such of
its covenants and obligations as are specifically set forth in
this Article Fourteen, and no implied covenants or obligations
with respect to the holders of Senior Indebtedness shall be
read into this Indenture against the Trustee. The Trustee
shall not be deemed to owe any fiduciary duty to the holders of
Senior Indebtedness and, subject to the provisions of Section
7.01, the Trustee shall not be liable to any holder of Senior
Indebtedness if it shall pay over or deliver to holders of De-
bentures, the Company or any other person money or assets to
which any holder of Senior Indebtedness shall be entitled by
virtue of this Article Fourteen or otherwise.
SECTION 14.08. No right of any present or future
holder of any Senior Indebtedness to enforce subordination as
herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Com-
pany or by any act or failure to act, in good faith, by any
such holder, or by any noncompliance by the Company with the
terms, provisions and covenants of this Indenture, regardless
of any knowledge thereof which any such holder may have or oth-
erwise be charged with.
Without in any way limiting the generality of the
foregoing paragraph, the holders of Senior Indebtedness may, at
any time and from time to time, without the consent of or no-
tice to the Trustee or the holders of the Debentures, without
incurring responsibility to the holders of the Debentures and
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<PAGE> 91
without impairing or releasing the subordination provided in
this Article or the obligations hereunder of the holders of the
Debentures to the holders of Senior Indebtedness, do any one or
more of the following: (i) change the manner, place or terms
of payment or extend the time of payment of, or renew or alter,
Senior Indebtedness, or otherwise amend or supplement in any
manner Senior Indebtedness or any instrument evidencing the
same or any agreement under which Senior Indebtedness is out-
standing; (ii) sell, exchange, release or otherwise deal with
any property pledged, mortgaged or otherwise securing Senior
Indebtedness; (iii) release any person liable in any manner for
the collection of Senior Indebtedness; and (iv) exercise or
refrain from exercising any rights against the Company and any
other person.
The First National Bank of Chicago, as Trustee,
hereby accepts the trusts in this Indenture declared and pro-
vided, upon the terms and conditions hereinabove set forth.
-77-
<PAGE> 92
IN WITNESS WHEREOF, the parties hereto have caused
this Indenture to be duly executed, and their respective corpo-
rate seals to be hereunto affixed and attested, all as of the
day and year first above written.
TRANSAMERICA CORPORATION
By
---------------------------
Executive Vice President
and Chief Financial Office
Attest:
By
----------------------
Secretary
THE FIRST NATIONAL BANK OF CHICAGO
as Trustee
Attest:
By
------------------------------
By
---------------------
(Assistant Treasurer)
-78-
<PAGE> 93
STATE OF CALIFORNIA )
ss.:
COUNTY OF SAN FRANCISCO)
On _____________ __, 1994 before me, ____________, Notary
Public, personally appeared ___________________ and
/ / personally known to me - OR -
/ / proved to me on the basis of satisfactory evidence to be
the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the
same in his/her/their authorized capacity(ies), and that by
his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed
the instrument.
Witness my hand and official seal.
- -----------------------------
Signature of Notary
CAPACITY CLAIMED BY SIGNER
/ / INDIVIDUAL(S) _____________________
/ / CORPORATE OFFICER(S)____________________
/ / PARTNER(S)
/ / ATTORNEY-IN-FACT
/ / TRUSTEE(S)
/ / GUARDIAN/CONSERVATOR
/ / OTHER:
SIGNER IS REPRESENTING:
NAME OF PERSON(S) OR ENTITY(IES)
TRANSAMERICA CORPORATION
-79-
<PAGE> 94
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On _________________ __, 1994 before me, ____________,
Notary Public, personally appeared ___________________ and
/ / personally known to me - OR -
/ / proved to me on the basis of satisfactory evidence to be
the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the
same in his/her/their authorized capacity(ies), and that by
his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed
the instrument.
Witness my hand and official seal.
- -----------------------------
Signature of Notary
CAPACITY CLAIMED BY SIGNER
/ / INDIVIDUAL(S) _____________________
/ / CORPORATE OFFICER(S) / / TRUST OFFICER
/ / PARTNER(S)
/ / ATTORNEY-IN-FACT
/ / TRUSTEE(S)
/ / GUARDIAN/CONSERVATOR
/ / OTHER:
SIGNER IS REPRESENTING:
NAME OF PERSON(S) OR ENTITY(IES)
(TRUSTEE)
-80-
<PAGE> 1
(WLRK Draft -- 10/13/94)
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 shall be 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 (other than the Initial Preferred
Limited Partners) 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 any determination to pay Dividends ("declaration")
to all Limited Partners of record as of the record date for such
payments of Dividends; provided, however, that if and to the extent
Transamerica does make interest payments on the Junior Subordinated
Debentures, the General Partner shall, to the extent funds are legally
available therefor, declare dividends on the Preferred Securities.
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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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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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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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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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 - 10/13/94)
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 dated _______ 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 first 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 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. 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 are not junior to any other equity securities
of the successor entity, with respect to participation in the profits and
Dividends, and in the assets, of the successor entity, (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 - 10/13/94)
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 dated ____________ 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 first 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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(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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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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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 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
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<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. 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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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 are not junior to
any other equity securities of the successor entity, with respect to
participation in the profits and Dividends, and in the assets, of the successor
entity, (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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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 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 13, 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
14 October 1994
