EXHIBIT 10.21
AMENDMENT NO. 1 AND WAIVER
Dated as of December 12, 2001
to
CREDIT AGREEMENT
Dated as of May 24, 2000
REINSURANCE GROUP OF AMERICA, INCORPORATED, as Borrower, the BANKS party
hereto and THE BANK OF NEW YORK, as Administrative Agent, agree as follows:
1. Credit Agreement. Reference is made to the Credit Agreement, dated as
of May 24, 2000 among Reinsurance Group of America, Incorporated, as Borrower,
The Bank of New York, as Administrative Agent, Bank of America, N.A., as
Syndication Agent, Fleet National Bank, as Documentation Agent, and Royal Bank
of Canada, as Co-Agent (as amended prior to the date hereof, the "Credit
Agreement"). Terms used but not defined in this Amendment (this Amendment") are
used herein with the meaning ascribed to them in the Credit Agreement.
2. Amendments. On and after the Effective Date (as defined below), the
Credit Agreement shall be amended as follows:
(a) Section 4.19 to the Credit Agreement shall be amended and restated in
its entirety to read as follows:
"Issue any of its Capital Securities or sell, transfer or otherwise
dispose of any Capital Securities of any Subsidiary, except that this
Section 4.19 shall not apply to (a) any issuance by the Borrower of
any of its Capital Securities, (b) any issuance by a Subsidiary of any
of its Capital Securities to the Borrower or a Wholly Owned
Subsidiary, (c) any issuance by a Subsidiary of any of its Capital
Securities to the holders of the common stock of such Subsidiary made
pro rata to the relative amounts of such common stock held by such
holders, (d) any disposition by the Borrower or any Subsidiary of any
Capital Securities of a Subsidiary to the Borrower or a Wholly Owned
Subsidiary, (e) any issuance by a Subsidiary that is not a Material
Subsidiary of less than 50% of its Capital Securities, and (f) any
issuance by an RGA Trust of Trust Preferred Securities."
(b) The following new definitions shall be added in the correct
alphabetical order to Section 10.01 of the Credit Agreement:
(i) "Amendment No. 1 and Waiver" means this Amendment No. 1 and Waiver
dated as of December 12, 2001 to the Credit Agreement dated as of May
24, 2000, among Reinsurance Group of America, Incorporated, as
Borrower, The Bank of New York, as Administrative Agent, Bank of
America, N.A., as Syndication Agent, Fleet National Bank, as
Documentation Agent, and Royal Bank of Canada, as Co-Agent.
(ii) "RGA Trust" means either of RGA Capital Trust I or RGA Capital Trust
II, in each case a Wholly Owned Subsidiary of the Borrower formed
solely for the purpose of issuing Trust Preferred Securities.
(iii) "TPS Exclusion Amount" means, on the date of determination, an
amount equal to 15% of the sum of (i) the accreted value of the Trust
Preferred Securities outstanding on such date, (ii) Consolidated
Indebtedness as of such date (excluding, to the extent otherwise
included, the Trust Preferred Securities) and (iii) the Consolidated
Net Worth as of such date (excluding, to the extent otherwise
included, the Trust Preferred Securities).
(iv) "Trust Guaranty" means the guarantee issued by the Borrower in
connection with the Trust Preferred Securities Transaction
substantially as described on Annex A hereto.
(v) "Trust Preferred Securities" means the Trust Preferred Securities
referred to and substantially as described in Annex A to this
Amendment No. 1 and Waiver.
(vi) "Trust Preferred Securities Documentation" means the agreements,
instruments and other documents pursuant to which the RGA Trust is
established and funded and the Trust Preferred Securities are issued,
in each case substantially in the form and substance as described in
Annex A to Amendment No. 1 and Waiver, as reasonably determined by the
Administrative Agent, as such documentation may be waived, amended or
otherwise modified from time to time with the consent of the
Administrative Agent, which consent will not be unreasonably withheld.
(vii) "Trust Preferred Securities Transaction" means the transactions
leading to the issuance of the Trust Preferred Securities, including
the formation of the Trust, the issuance of the Trust Guaranty and the
issuance of the Trust Preferred Securities.
(c) The following definitions in Section 10.10 of the Credit Agreement
shall be amended and restated in their entirety to read as follows:
"Permitted Guaranty" means any Guaranty that (a) is an endorsement of
a check for collection in the ordinary course of business, (b) is a
Guaranty of and only of the obligations of the Borrower under the
Loan Documents, (c) constitutes Indebtedness for purposes of
calculating the covenant in Section 4.21, (d) is a Trust Guaranty or
(e) is a Guaranty, not otherwise specifically covered in this
definition, of Liabilities of a Subsidiary in an aggregate amount at
any time outstanding not exceeding $15,000,000.
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"Permitted Restrictive Covenant" means (a) any covenant or restriction
contained in any Loan Document, (b) any covenant or restriction
binding upon any Person at the time such Person becomes a Subsidiary
of the Borrower if the same is not created in contemplation thereof,
(c) any covenant or restriction of the type contained in Section 4.11
that is contained in any Contract evidencing or providing for the
creation of or concerning Purchase Money Indebtedness so long as such
covenant or restriction is limited to the property purchased
therewith, (d) any covenant or restriction described in Schedule 4.18,
but only to the extent such covenant or restriction is there
identified by specific reference to the provision of the Contract in
which such covenant or restriction is contained, (e) any covenant or
restriction requiring the approval of the Applicable Insurance
Regulatory Authority prior to the making of payments by RGA Re under
(i) the 7.35% surplus note dated December 15, 1997 made by RGA Re or
(ii) the 7.08% surplus note dated December 11, 1998 made by RGA Re,
(f) any covenant or restriction of the type contained in Section 4.11
that is contained in (i) the documents governing the senior notes
issued by the Borrower on or about March 22, 1996, or (ii) the
indenture governing the senior notes issued by the Borrower on or
about December 18, 2001, in each case to the extent such covenant or
restriction limits the ability of any Subsidiary to create any Lien on
the Capital Securities of any other Subsidiary held by such
Subsidiary, or (g) any covenant or restriction that (i) is not more
burdensome than an existing Permitted Restrictive Covenant that is
such by virtue of clause (b), (c), (d), (e) or (g), (ii) is contained
in a Contract constituting a renewal, extension or replacement of the
Contract in which such existing Permitted Restrictive Covenant is
contained and (iii) is binding only on the Person or Persons bound by
such existing Permitted Restrictive Covenant.
(d) The definition of "Consolidated Indebtedness" shall be amended and
restated in its entirety to read as follows:
"Consolidated Indebtedness" means, at any time, the consolidated
Indebtedness of the Borrower and the Consolidated Subsidiaries as of
such time; provided, however, for purposes of calculating the covenant
contained in Section 4.21, Consolidated Indebtedness shall not include
(i) the obligation of the Borrower or any Subsidiary that is an
Insurance Company under letters of credit, to the extent undrawn,
supporting the liability of such Subsidiary in respect of any
reinsurance underwritten by such Subsidiary and (ii) the aggregate
outstanding Indebtedness evidenced by the Trust Preferred Securities
to the extent the accreted value of such Indebtedness does not exceed
the TPS Exclusion Amount.
(e) The definition of "Consolidated Net Worth" shall be amended and
restated in its entirety to read as follows:
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"Consolidated Net Worth" means, at any time, without duplication, the
consolidated stockholders' equity of the Borrower and the
Consolidated Subsidiaries (without giving effect to any adjustment
made pursuant to FASB 115 to the extent less than $50,000,000) less
their consolidated Mandatorily Redeemable Stock (except to the extent
deducted in determining such consolidated stockholders' equity) plus
the aggregate outstanding amount of Trust Preferred Securities not in
excess of the TPS Exclusion Amount, in each case, as of such time.
3. Waiver. The Administrative Agent and the Banks party hereto hereby
waive:
(a) any non-compliance by the Borrower with the provisions of Section
4.18 of the Credit Agreement prior to the date hereof to the extent the Borrower
would have otherwise been in compliance with Section 4.18 of the Credit
Agreement, as amended by this Amendment No. 1 and Waiver, at such time.
(b) any Default or Event of Default that may exist under Section
6.01(c)(i) of the Credit Agreement solely as a result of any non-compliance by
the Borrower described in the preceding clause (a).
4. Continuing Effect of Credit Agreement. The provisions of the Credit
Agreement are and shall remain in full force and effect and are hereby in all
respects confirmed, approved and ratified.
5. Representations and Warranties. In order to induce the Administrative
Agent and the Banks to agree to this Amendment, the Borrower hereby represents
and warrants as follows:
Each representation and warranty made by the Borrower in any Loan Document
is, both before and after giving effect to this Amendment, true and correct at
and as of the Effective Date, and, both before and after giving effect to this
Amendment, no Default or Event of Default is continuing at and as of the
Effective Date.
6. Conditions to Effectiveness. This Amendment shall be effective as of the
date first written above, but shall not become effective as of such date until
the date (the "Effective Date") that each of the following conditions shall have
been satisfied in the sole determination of the Administrative Agent:
(a) the Administrative Agent shall have received each of the following,
in form and substance satisfactory to the Administrative Agent:
(i) this Amendment duly executed by the Borrower, the
Administrative Agent and the Required Banks; and
(ii) such other information, documents or materials as the
Administrative Agent may have requested pursuant to the Loan
Documents; and
(b) the Administrative Agent shall have received all fees and expenses
payable pursuant to the Loan Documents and this Amendment including the fees and
disbursements of
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legal counsel retained by the Agent (if an invoice for such fees and
disbursements of such counsel has been delivered to the Borrower).
7. Governing Law. This Amendment shall, pursuant to New York General
Obligations Law 5-1401, be construed in accordance with and governed by the
laws of the State of New York.
8. Counterparts. This Amendment may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if
the signatures thereon were upon the same instrument.
9. Headings. Section headings in this Amendment are included herein for
convenience and reference only and shall not constitute a part of this
Amendment for any other purpose.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 and
Waiver to be executed by their duly authorized officers all as of the date first
above written.
REINSURANCE GROUP OF AMERICA,
INCORPORATED, as Borrower
By: /s/ Xxxx Xxxxxx
------------------------------------
Name: Xxxx Xxxxxx
Title: Senior Vice President
THE BANK OF NEW YORK, as Administrative
Agent and as a Bank
By:
------------------------------------
Name:
Title:
BANK OF AMERICA, N.A.
as a Bank
By:
------------------------------------
Name:
Title:
FLEET NATIONAL BANK
as a Bank
By:
------------------------------------
Name:
Title:
ROYAL BANK OF CANADA
as a Bank
By:
------------------------------------
Name:
Title:
[Amendment No. 1 and Waiver]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 and
Waiver to be executed by their duly authorized officers all as of the date first
above xxxxxx.
REINSURANCE GROUP OF AMERICA,
INCORPORATED, as Borrower
By:
-------------------------------------
Name:
Title:
THE BANK OF NEW YORK, as Administrative
Agent and as a Bank
By: /s/ Xxxxxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxxxxx X. Xxxxxxx
Title: Vice President
BANK OF AMERICA,N.A.
as a Bank
By:
-------------------------------------
Name:
Title:
FLEET NATIONAL BANK
as a Bank
By:
-------------------------------------
Name:
Title:
ROYAL, BANK OF CANADA
as a Bank
By:
-------------------------------------
Name:
Title:
[Amendment No. 1 and Waiver]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 and
Waiver to be executed by their duly authorized officers all as of the date first
above xxxxxx.
REINSURANCE GROUP OF AMERICA,
INCORPORATED, as Borrower
By:
-------------------------------------
Name:
Title:
THE BANK OF NEW YORK, as Administrative
Agent and as a Bank
By:
-------------------------------------
Name:
Title:
BANK OF AMERICA, N.A.
as a Bank
By: /s/ Xxx X. Xxxxxx
-------------------------------------
Name: Xxx X. Xxxxxx
Title: Managing Director
FLEET NATIONAL BANK
as a Bank
By:
-------------------------------------
Name:
Title:
ROYAL BANK OF CANADA
as a Bank
By:
-------------------------------------
Name:
Title:
[Amendment No. 1 and Waiver]
IN WITNESS WHEREOF, the parties hereto have caused this amendment No. 1 and
Waiver to be executed by their duly authorized officers all as of the date first
above xxxxxx.
REINSURANCE GROUP OF AMERICA,
INCORPORATED, as Borrower
By:
-------------------------------------
Name:
Title:
THE BANK OF NEW YORK, as Administrative
Agent and as a Bank
By:
-------------------------------------
Name:
Title:
BANK OF AMERICA, N.A.
as a Bank
By:
-------------------------------------
Name:
Title:
FLEET NATIONAL BANK
as a Bank
By: /s/ Xxxxx X. Xxxxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Director
ROYAL BANK OF CANADA
as a Bank
By:
-------------------------------------
Name:
Title:
[Amendment No. 1 and Waiver]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 and
Waiver to be executed by their duly authorized officers all as of the date first
above xxxxxx.
REINSURANCE GROUP OF AMERICA,
INCORPORATED, as Borrower
By:
-------------------------------------
Name:
Title:
THE BANK OF NEW YORK, as Administrative
Agent and as a Bank
By:
-------------------------------------
Name:
Title:
BANK OF AMERICA, N.A.
as a Bank
By:
-------------------------------------
Name:
Title:
FLEET NATIONAL BANK
as a Bank
By:
-------------------------------------
Name:
Title:
ROYAL BANK OF CANADA
as a Bank
By: /s/ Xxxxxxxxx Xxxx
-------------------------------------
Name: Xxxxxxxxx Xxxx
Title: Senior Manager
[Amendment No. 1 and Waiver]
ANNEX A
THE OFFERING
SECURITIES OFFERED....... units, or up to units if the underwriters
exercise their option to purchase additional units,
consisting of:
o a preferred security having a stated
liquidation amount of $50; and
o a warrant to purchase at any time prior to
, 2050, shares, unless earlier redeemed,
subject to antidilution adjustments, of our
common stock.
The preferred securities represent an undivided
beneficial ownership interest in the assets of the
Trust, which will consist solely of the junior
subordinated debentures issued by us. Each debenture
will have a principal amount at maturity of $50. To
exercise a warrant, a holder must tender the warrant
together with its exercise price as described below
under "-- Warrant Exercise Price."
At any time after the issuance of the units, the
preferred security and the warrant components of each
unit may be separated by the holder and transferred
separately. Thereafter, a separated warrant and
preferred security may be recombined to form a unit.
PRICE.................... $50 per unit.
MATURITY OF DEBENTURES... , 2050.
EXPIRATION OF WARRANTS... , 2050.
DISTRIBUTION DATES....... , , and of each year,
beginning on , 2002. Distribution on the
preferred securities will be made only to the extent
that we make corresponding interest payments on the
debentures.
DISTRIBUTION RATE........ % per year on the stated liquidation amount of
the preferred securities, subject to reset upon a
remarketing to the reset rate on the accreted value
as of the end of the day next preceding the
remarketing settlement date. The distribution rate on
the preferred securities will correspond to the
interest rate on the debentures.
ACCRETED VALUE........... The "accreted value" of a preferred security is
equal to the accreted value of a debenture, which is
equal to the sum of the initial purchase price of the
preferred security component of each unit
(or $ ) plus accrual of discount (that is, the
difference between the principal amount of $50
payable in respect of a debenture on 2050 and
its initial purchase price) calculated from ,
2001 to the date of calculation at the all-in yield
rate of % per annum through , 2050 minus
accrual of interest on the principal amount of the
debentures (or $50) at the rate of % in each case,
on a quarterly bond equivalent yield basis using a
360-day year of twelve 30-day months until that sum
equals $50 on 2050.
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DEFERRAL OF PAYMENTS..... So long as we are not in default in the payment of
interest on the debentures and so long as a failed
remarketing has not occurred, we will have the right,
at any time, and from time to time during the term of
the debentures, to defer payments of interest by
extending the interest payment period for a period
not exceeding 20 consecutive quarters or extending
beyond the stated maturity of the debentures (the
"extension period"), during which extension period no
interest will be due and payable. Prior to the
termination of any such extension period, we may
further extend such extension period; provided that
such extension period, together with all such
previous and further extensions, may not exceed 20
consecutive quarters or extend beyond the stated
maturity of the debentures. During any extension
period, we will agree not to make certain restricted
payments.
WARRANT EXERCISE PRICE... The warrant exercise price will be $50, unless RGA
chooses to redeem the warrants as described below,
in which case the exercise price of the warrants
instead of redemption will be an amount initially
equal to $ , which price will accrete on a daily
basis as described in this prospectus supplement to
a maximum of $50, on the expiration date. In such
circumstances, the warrant exercise price will
accrete on a daily basis such that on any given date
of calculation it will be equal to $ plus
accretion, calculated from , 2001 to the
date of calculation, at the all-in yield of %
per annum through , 2050 minus accrual of an
amount equal to $50 multiplied by %, in each
case, on a quarterly bond equivalent basis using a
360-day year of twelve 30-day months. In connection
with an exercise of the warrants instead of a
redemption, the exercise price of the warrants will
be calculated as of the business day next preceding
the redemption date. If the warrant holder exercises
the warrant other than instead of a redemption, the
warrant exercise price will be $50.
OPTIONAL REDEMPTION OF
WARRANTS AND REMARKETING
OF PREFERRED SECURITIES.. If on any date after , 2004, the closing
price of our common stock exceeds and has exceeded a
price per share equal to $ , subject to
adjustment, for at least 20 trading days (as defined
below) within the immediately preceding 30
consecutive trading days, we may at our option, elect
to redeem the warrants, in whole but not in part, for
cash [or, if specified conditions are met, our common
stock or a combination of cash and our common stock,]
equal to the warrant redemption amount, which will be
equal to $50 minus the exercise price of the warrant
as of the end of the day next preceding the
redemption date instead of redemption as described
above. In addition, as described below, we may redeem
the warrants if certain other events occur.
The warrants will be redeemed on the redemption date
unless a warrant holder affirmatively elects to
exercise its warrants. We are is not required to give
the holders of the warrants more than six business
days notice of our election to redeem the warrants.
Because of the abbreviated notification period, a
warrant holder
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who intends to exercise its warrant upon an optional
redemption of the warrants may want to provide standing
instructions [to its broker or the party which holds
the warrant for the holder for the exercise of the
warrants and the delivery of shares to the warrant
agent] in order to allow that party to act quickly if
it receives a notice of redemption from us. See "Risk
Factors -- You may be required to elect to exercise
your warrants within five business days of notification
of an election by RGA to optionally redeem the
warrants" beginning on page in this prospectus
supplement.
In connection with a redemption or upon expiration of
the warrants, we will also be obligated to seek a
remarketing of all the preferred securities at a price
of no less than 100% of their accreted value. If the
warrant holder chooses to exercise the warrant and is a
unit holder that has not opted out of the remarketing,
the proceeds from a successful contemporaneous
remarketing of the related preferred security will be
applied to satisfy in full the exercise price of the
warrant. The remarketing settlement date and the
optional redemption date will be three business days
after the remarketing date.
Also in connection with a remarketing:
- the adjusted maturity of the debentures (and, as a
result, the redemption date of the preferred
securities) will become the date which is 93 days
following the remarketing settlement date;
- the amount due at the adjusted maturity date of the
debentures will be the accreted value of the
debentures as of the end of the business day next
preceding the remarketing settlement date (and, as a
result, the amount due at the adjusted redemption
date of the preferred securities will be the
accreted value of the preferred securities as of
such date);
- upon a remarketing of the preferred securities in
connection with an expiration of the warrants at
maturity, the preferred securities will be
remarketed at their stated liquidation amount; and
- on the remarketing settlement date, the debentures
will have an interest rate on their accreted value
or stated liquidation amount if remarketed at
maturity (and, as a result, the preferred securities
will have a distribution rate on their accreted
value or stated liquidation amount if remarketed at
maturity) equal to the rate established in the
remarketing.
See "-- Failed Remarketing" below for a description of
the consequences of the failure to successfully
remarket the preferred securities in connection with a
redemption or expiration of the warrants.
REDEMPTION AND
REMARKETING UPON TAX
EVENT OR INVESTMENT
COMPANY EVENT........... If (1) certain tax events occur or (2) if there is a
more than an insubstantial risk that the Trust will be
considered an investment
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company under the Investment Company Act of
1940 and certain requirements are satisfied,
we may, at our option, elect to redeem the
warrants at their warrant redemption amount
and remarket the preferred securities.
CHANGE OF CONTROL............... If a change of control occurs, as defined
under "Description of the Warrants -- Change
of Control" in this prospectus supplement,
the holders of unit securities will have the
right to:
o require RGA to redeem that holder's
warrant on the date that is 45 days
after the date RGA gives notice of the
change of control event at a redemption
price equal to 100% of the warrant
redemption amount on the redemption date
which may be paid in cash or, at our
option if we satisfy specified
conditions, our common stock or a
combination of cash and our common
stock; and
o exchange that holder's preferred
security for a debenture having an
accreted value equal to the accreted
value of such preferred security and to
require RGA to repurchase such debenture
on the repurchase date at a repurchase
price equal to 100% of the accreted
value of the debenture on the repurchase
date plus accrued and unpaid interest
(including deferred interest) on the
debentures to, but excluding, the
repurchase date.
See "Description of the Warrants -- Change of
Control" and "Description of the Preferred
Securities -- Change of Control" in this
prospectus supplement.
REMARKETING AT EXPIRATION OF
WARRANTS........................ If not previously remarketed, the preferred
securities will be remarketed on ,
2050. In addition, the warrants will expire
on , 2050, unless previously exercised.
EXERCISE OF WARRANTS............ A holder may exercise warrants at any time
prior to the close of business on ,
2050 (the "expiration date"), unless earlier
redeemed.
The warrants will not be exercisable unless,
at the time of the exercise:
o a registration statement is in
effect under the Securities Act of 1933
covering the issuance and sale (and
resale) of the shares of common stock
upon exercise of the warrants or the
issuance and sale (and resale) of the
shares upon exercise of the warrants is
exempt from the registration
requirements of the Securities Act of
1933;
o the shares have been registered,
qualified or are deemed to be exempt
under the securities laws of the state
of residence of the exercising holder of
the warrants; and
o to the extent required by
applicable law, a then current
prospectus is delivered to the
exercising holders of the warrants.
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Holders must pay the exercise price of their
warrants in cash (including the automatic
application of a portion of the proceeds of
any remarketing of preferred securities).
Accordingly, the holders of units may not
tender their preferred securities directly
toward payment of the exercise price of the
warrants.
RIGHTS OF A UNIT HOLDER......... Following an exercise of warrants by a unit
holder other than in connection with a
remarketing, the holder may require the Trust
to exchange the holder's related preferred
securities for debentures and require RGA to
repurchase such debentures at $50 on a
special distribution date which is no less
than 93 days following the exercise of the
warrants.
If a unit holder exercises the warrant that
is part of the unit in connection with an
optional redemption of the warrants by RGA or
expiration of the warrants, the holder will
be able to satisfy in full the exercise price
by applying the proceeds of a successful
related remarketing of the related preferred
securities. See "Description of the Preferred
Securities -- Remarketing" in this prospectus
supplement.
FAILED REMARKETING.............. If the remarketing agent is unable to
remarket the preferred securities when
required for any reason, a "failed
remarketing" will have occurred. If a failed
remarketing occurs:
o beginning on the third business day
after such date, interest will accrue on
the accreted value of the debentures,
and distributions will accumulate on the
accreted value of the preferred
securities;
o the interest rate on the accreted
value of debentures will be % pre
annum and, as a result, the distribution
rate on the accreted value of the
preferred securities will increase
correspondingly;
o the stated maturity of the accreted
value of the debentures (and, as a
result, the final distribution date for
the preferred securities) will become
the date which is 93 days after the
failed remarketing settlement date; and
o we will no longer have the option
to defer interest payments on the
debentures.
Notwithstanding that a failed remarketing in
connection with an optional redemption of the
warrants may occur, the warrants would
nevertheless be redeemed at the warrant
redemption amount on the optional redemption
date and a warrant holder who has elected to
exercise its warrants will be obligated to
exercise its warrants instead of such
redemption by paying the exercise price in
cash.
GUARANTEE....................... The following payments or distributions with
respect to the preferred securities and
common securities on a pro rata basis, to
the extent not paid by or on behalf of the
Trust, will be guaranteed by us:
o any accumulated and unpaid
distributions required to be paid on the
preferred securities and common
securities on a pro
rata basis, to the extent that the Trust has
sufficient funds available therefor at the time;
- the redemption price with respect to any preferred
securities and common securities on a pro rata basis
called for redemption, to the extent that the Trust
has sufficient funds available therefor at such time;
- the repurchase of debentures, which are exchanged for
preferred securities if a change of control occurs,
at the accreted value equal to the accreted value of
the preferred securities, plus accrued and unpaid
interest on the debentures (including deferred
interest) to, but excluding, the repurchase date; and
- upon a voluntary or involuntary dissolution, winding
up or termination of the Trust (other than in
connection with the exchange of all of the preferred
securities for debentures and the distribution of the
debentures to the holders of the preferred securities
and common securities on a pro rata basis), the
lesser of
- the aggregate accreted value of the common and
preferred securities of the Trust and all
accumulated and unpaid distributions thereon to the
date of payment; and
- the amount of assets of the Trust remaining
available for distribution to the holders of
preferred securities and common securities on a
pro rata basis.
Our obligations under the guarantee will be
subordinated and junior in right of payment to all of
our existing and future senior indebtedness.
THE TRUST.............. The Trust is a Delaware statutory business trust. The
sole assets of the Trust will be the debentures. The
Trust will issue the preferred securities and the
common securities. All of the common securities will be
owned by us, in an aggregate liquidation amount of at
least 3% of the total capital of the Trust.
RANKING................ Payment of distributions on, and the redemption price
of, the preferred securities and the common securities,
will generally be made pro rata based on their
liquidation amounts. However, if on any payment date,
an indenture event of default has occurred and is
continuing, no payment on the common securities will be
made unless payment in full in cash of all accumulated
and unpaid distributions on all of the outstanding
preferred securities for all current and prior
distribution periods (or in the case of payment of the
redemption price, the full amount of such redemption
price on all of the outstanding preferred securities
then called for redemption), has been made or provided
for.
FORM AND DENOMINATION.. The Depository Trust Company, which we refer to as
"DTC," will act as securities depositary for the unit
securities, each of which will be issued only as fully
registered securities registered in the name of DTC or
its nominee for credit to an account of a
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direct or indirect participant in DTC. One or more
fully registered certificates will be issued for each
of the unit securities, and will be deposited with the
property trustee as custodian for DTC. The preferred
securities will be issued in denominations of $50
stated liquidation amount and whole multiples of $50.
See "Book-Entry Issuance" in this prospectus
supplement.
USE OF PROCEEDS......... We will use the net proceeds from the offering of the
units (consisting of the portion of the net proceeds
from the sale of the units relating to the warrants,
and the net proceeds from the issuance of the
debentures to the Trust) for general corporate
purposes. The Trust will use the portion of the net
proceeds from the sale of the units relating to the
preferred securities to acquire the debentures from us.
MATERIAL UNITED STATES
FEDERAL INCOME TAX
CONSEQUENCES............ RGA intends to treat and you (by your acceptance of a
beneficial interest in the unit) agree to treat each
unit as an "investment unit" consisting of a preferred
security and a warrant. As such, the purchase price of
each unit will be allocated between the preferred
security and the warrant in proportion to their
respective fair market values at the time of purchase.
In the opinion of Xxxxx Xxxx LLP, counsel to RGA, for
United States federal income tax purposes (x) the
debentures will be treated as debt and (y) the Trust
will be treated as a grantor trust. As a result, each
holder of a preferred security generally will be
treated as owning an undivided beneficial ownership
interest in the debentures. As a consequence, if the
holder is a United States taxpayer, it will be required
to include as ordinary income amounts constituting
original issue discount. The amount of interest income,
including original issue discount, on which it will be
taxed will exceed its share of the cash interest
payments received from the Trust on the preferred
securities. See "Material United States Federal Income
Tax Consequences" in this prospectus supplement.
ERISA CONSIDERATIONS.... Each purchaser and subsequent transferee of the units,
including the underlying preferred securities,
warrants, debentures and any shares of our common stock
issued upon the exercise of the warrants will be deemed
to have represented and warranted that the acquisition
and holding of these securities by the purchaser or
transferee will not constitute a non-exempt prohibited
transaction under Section 406 of the Employee
Retirement Income Security Act of 1974 ("ERISA") or
Section 4975 of the Internal Revenue Code of 1986 or
similar violation under any applicable similar laws.
See "ERISA Considerations" in this prospectus
supplement.
ABSENCE OF A PUBLIC
MARKET FOR THE UNITS.... The units and their components will be new securities.
We cannot assure you that an active or liquid market
will develop for the units or their components.
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NEW YORK STOCK EXCHANGE Our common stock is traded on the New York Stock
SYMBOL FOR OUR COMMON Exchange under the symbol "RGA". We have applied to
STOCK AND LISTING........ list the units on the NYSE under the symbol " ."
We expect that trading of the units on the NYSE will
commence on the second trading day after the date of
this prospectus supplement. If either the preferred
securities or the warrants are traded at a volume
that satisfies applicable exchange listing
requirements, then we will use our reasonable best
efforts to list those securities on the national
securities exchange or quotation system on which the
units are then listed or quoted.
[PLANNED DEBT OFFERING
Following this offering, we intend to sell $200. million aggregate
principal amount of our senior notes. This offering and the concurrent senior
notes offering are not conditioned on each other, which means that we may
complete either offering without completing the other.]
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