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Exhibit 4.10
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COMMON SECURITIES GUARANTEE AGREEMENT
American Annuity Group Capital Trust II
Dated as of March 11, 1997
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COMMON SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Common Securities Guarantee"), dated as
of March 11, 1997, is executed and delivered by American Annuity Group, Inc., a
Delaware corporation (the "Guarantor"), for the benefit of the Holders (as
defined herein) from time to time of the Common Securities (as defined herein)
of American Annuity Group Capital Trust II, a Delaware business trust (the
"Issuer").
WHEREAS, pursuant to a Declaration of Trust (the
"Declaration"), dated as of March 11, 1997, among the Trustees of the Issuer
named therein, AAG Holding Company, Inc., an Ohio corporation ("Sponsor") and a
wholly-owned subsidiary of the Guarantor, as sponsor, and the holders from time
to time of undivided beneficial interests in the assets of the Issuer, the
Issuer may issue on and after the date hereof Two Thousand Three Twenty capital
trust common securities, having an aggregate stated liquidation amount of
$2,320,000 (the "Common Securities");
WHEREAS, as incentive for the Holders to purchase the Common
Securities, the Guarantor desires to irrevocably and unconditionally agree, to
the extent set forth in this Common Securities Guarantee, to pay to the Holders
of the Common Securities the Guarantee Payments (as defined herein) and to make
certain other payments on the terms and conditions set forth herein; and
WHEREAS, the Guarantor is also executing and delivering a
guarantee agreement (the "Preferred Securities Guarantee") for the benefit of
the holders of the Preferred Securities (as defined herein), except that if an
Event of Default (as defined in the Indenture), has occurred and is continuing,
the rights of Holders of the Common Securities to receive Guarantee Payments
under this Common Securities Guarantee are subordinated to the rights of holders
of Preferred Securities to receive Guarantee Payments under the Preferred
Securities Guarantee.
NOW, THEREFORE, in consideration of the purchase by each
Holder of Common Securities, which purchase the Guarantor hereby agrees shall
benefit the Guarantor, the Guarantor executes and delivers this Common
Securities Guarantee for the benefit of the Holders.
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions Interpretation
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In this Common Securities Guarantee, unless the
context otherwise requires:
(a) Capitalized terms used in this Common Securities
Guarantee but not defined in the preamble above have the
respective meanings assigned to them in this Section 1.1;
(b) Terms defined in the Declaration as at the date
of execution of this
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Common Securities Guarantee have the same meaning when used in
this Common Securities Guarantee unless otherwise defined in
this Common Securities Guarantee;
(c) a term defined anywhere in this Common Securities
Guarantee has the same meaning throughout;
(d) all references to "the Common Securities
Guarantee" or "this Common Securities Guarantee" are to this
Common Securities Guarantees modified, supplemented or amended
from time to time;
(e) all references in this Common Securities
Guarantee to Articles and Sections are to Articles and
Sections of this Common Securities Guarantee unless otherwise
specified; and
(f) a reference to the singular includes the plural
and vice versa.
"Guarantee Payments" shall mean the following
payments or distributions, without duplication, with respect to the Common
Securities, to the extent not paid or made by the Issuer: (i) any accrued and
unpaid Distributions which are required to be paid on such Common Securities to
the extent the Issuer shall have funds available therefor, (ii) the redemption
price, including all accrued and unpaid Distributions to the date of redemption
(the "Redemption Price") to the extent the Issuer has funds available therefor,
with respect to any Common Securities called for redemption by the Issuer, and
(iii) upon a voluntary or involuntary dissolution, winding-up or termination of
the Issuer (other than in connection with the distribution of Debentures to the
Holders in exchange for Common Securities as provided in the Declaration), the
lesser of (a) the aggregate of the liquidation amount and all accrued and unpaid
Distributions on the Common Securities to the date of payment, to the extent the
Issuer has funds available therefor, and (b) the amount of assets of the Issuer
remaining available for distribution to Holders in liquidation of the Issuer (in
either case, the "Liquidation Distribution"). If an Event of Default (as defined
in the Indenture), has occurred and is continuing, the rights of Holders of the
Common Securities to receive Guarantee Payments under this Common Securities
Guarantee are subordinated to the rights of holders of Preferred Securities to
receive Guarantee Payments.
"Holder" shall mean any holder, as registered on the
books and records of the Issuer, of any Common Securities.
"Preferred Securities" mean the securities
representing preferred undivided beneficial interests in the assets of the
Issuer.
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ARTICLE II
GUARANTEE
SECTION 2.1 Guarantee
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The Guarantor irrevocably and unconditionally agrees
to pay in full to the Holders the Guarantee Payments (without duplication of
amounts theretofore paid by the Issuer), as and when due, regardless of any
defense, right of set-off or counterclaim which the Issuer may have or assert.
The Guarantor's obligation to make a Guarantee Payment may be satisfied by
direct payment of the required amounts by the Guarantor to the Holders or by
causing the Issuer to pay such amounts to the Holders.
SECTION 2.2 Waiver of Notice and Demand
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The Guarantor hereby waives notice of acceptance of
this Common Securities Guarantee and of any liability to which it applies or may
apply, presentment, demand for payment, any right to require a proceeding first
against the Issuer or any other Person before proceeding against the Guarantor,
protest, notice of nonpayment, notice of dishonor, notice of redemption and all
other notices and demands.
SECTION 2.3 Obligations Not Affected
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The obligations, covenants, agreements and duties of
the Guarantor under this Common Securities Guarantee shall in no way be affected
or impaired by reason of the happening from time to time of any of the
following:
(a) the release or waiver, by operation of law or
otherwise, of the performance or observance by the Issuer of
any express or implied agreement, covenant, term or condition
relating to the Common Securities to be performed or observed
by the Issuer;
(b) the extension of time for the payment by the
Issuer of all or any portion of the Distributions, Redemption
Price, Liquidation Distribution or any other sums payable
under the terms of the Common Securities or the extension of
time for the performance of any other obligation under,
arising out of, or in connection with, the Common Securities
(other than an extension of time for payment of Distributions,
Redemption Price, Liquidation Distribution or other sum
payable that results from the extension of any interest
payment period on the Debentures or any extension of the
maturity date of the Debentures permitted by the Indenture);
(c) any failure, omission, delay or lack of diligence
on the part of the Holders to enforce, assert or exercise any
right, privilege, power or remedy conferred on the Holders
pursuant to the terms of the Common Securities, or any action
on the part of the Issuer granting indulgence or extension of
any kind;
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(d) the voluntary or involuntary liquidation,
dissolution, sale of any collateral, receivership, insolvency,
bankruptcy, assignment for the benefit of creditors,
reorganization, arrangement, composition or readjustment of
debt of, or other similar proceedings affecting, the Issuer or
any of the assets of the Issuer;
(e) any invalidity of, or defect or deficiency in,
the Common Securities;
(f) the settlement or compromise of any obligation
guaranteed hereby or hereby incurred; or
(g) any other circumstance whatsoever that might
otherwise constitute a legal or equitable discharge or defense
of a guarantor, it being the intent of this Section 2.3 that
the obligations of the Guarantor hereunder shall be absolute
and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain consent
of, the Guarantor with respect to the happening of any of the foregoing.
SECTION 2.4 Rights of Holders
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The Guarantor expressly acknowledges that any Holder
of Common Securities may institute a legal proceeding directly against the
Guarantor to enforce its rights under this Common Securities Guarantee, without
first instituting a legal proceeding against the Issuer or any other Person.
SECTION 2.5 Guarantee of Payment
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This Common Securities Guarantee creates a guarantee
of payment and not of collection.
SECTION 2.6 Subrogation
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The Guarantor shall be subrogated to all (if any)
rights of the Holders of Common Securities against the Issuer in respect of any
amounts paid to such Holders by the Guarantor under this Common Securities
Guarantee; provided, however, that the Guarantor shall not (except to the extent
required by mandatory provisions of law) be entitled to enforce or exercise any
rights which it may acquire by way of subrogation or any indemnity,
reimbursement or other agreement, in all cases as a result of payment under this
Common Securities Guarantee, if, at the time of any such payment, any amounts
are due and unpaid under this Common Securities Guarantee. If any amount shall
be paid to the Guarantor in violation of the preceding sentence, the Guarantor
agrees to hold such amount in trust for the Holders and to pay over such amount
to the Holders.
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SECTION 2.7 Independent Obligations
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The Guarantor acknowledges that its obligations
hereunder are independent of the obligations of the Issuer with respect to the
Common Securities and that the Guarantor shall be liable as principal and as
debtor hereunder to make Guarantee Payments pursuant to the terms of this Common
Securities Guarantee notwithstanding the occurrence of any event referred to in
subsections (a) through (g), inclusive, of Section 2.3 hereof.
ARTICLE III
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 3.1 Limitation of Transactions
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So long as any Common Securities remain outstanding,
if (i) the Guarantor shall be in default with respect to its Guarantee Payments
or other obligations hereunder, or (ii) there shall have occurred any Event of
Default under the Indenture then (a) the Guarantor shall not declare or pay any
dividend on, or make any distributions with respect to, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of its capital stock,
(b) the Guarantor shall not make any payment of interest, principal or premium,
if any, on or repay, repurchase or redeem any debt securities (including
guarantees) issued by the Guarantor which rank pari passu with or junior to the
Debentures and (c) the Guarantor shall not make any guarantee payments with
respect to the foregoing (other than pursuant to the Preferred Securities
Guarantee Agreement); PROVIDED, however, the Guarantor may declare and pay a
stock dividend where the dividend stock is the same stock as that on which the
dividend is being paid.
SECTION 3.2 Ranking
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This Common Securities Guarantee will constitute an
unsecured obligation of the Guarantor and will rank (i) subordinate and junior
in right of payment to all other liabilities of the Guarantor, (ii) pari passu
with the most senior preferred or preference stock now or hereafter issued by
the Guarantor and with any guarantee now or hereafter entered into by the
Guarantor in respect of any preferred or preference stock of any Affiliate of
the Guarantor, and (iii) senior to the Guarantor's common stock.
ARTICLE IV
TERMINATION
SECTION 4.1 Termination
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This Common Securities Guarantee shall terminate upon
full payment of the Redemption Price of all Common Securities, upon the
distribution of the Debentures to the Holders of all of the Common Securities or
upon full payment of the amounts payable in accordance with the Declaration upon
liquidation of the Issuer. Notwithstanding the foregoing, this Common Securities
Guarantee will continue to be effective or will be reinstated, as the case
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may be, if at any time any Holder of Common Securities must restore payment of
any sums paid under the Common Securities or under this Common Securities
Guarantee.
ARTICLE V
MISCELLANEOUS
SECTION 5.1 Successors and Assigns
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All guarantees and agreements contained in this
Common Securities Guarantee shall bind the successors, assigns, receivers,
trustees and representatives of the Guarantor and shall inure to the benefit of
the Holders of the Common Securities then outstanding.
SECTION 5.2 Amendments
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Except with respect to any changes which do not
adversely affect the rights of Holders (in which case no consent of Holders will
be required), this Common Securities Guarantee may only be amended with the
prior approval of the Holders of at least a majority in liquidation amount of
all the outstanding Common Securities. The provisions of Section 11.2 of the
Declaration with respect to meetings of Holders of the Securities apply to the
giving of such approval.
SECTION 5.3 Notices
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All notices provided for in this Common Securities
Guarantee 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 Issuer, in care of the Regular
Trustee at the Issuer's mailing address set forth below (or
such other address as the Issuer may give notice of to the
Holders of the Common Securities):
American Annuity Group Capital Trust II
c/o American Annuity Group, Inc.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
Attention: Xxxx X. Xxxxxxxx
(b) if given to the Guarantor, at the Guarantor's
mailing address set forth below (or such other address as the
Guarantor may give notice of to the Holders of the Common
Securities):
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American Annuity Group, Inc.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
Attention: Xxxx X. Xxxxxxxx, Senior Vice
President and General Counsel
(c) if given to any Holder of Common Securities, at
the address set forth on the books and records of the Issuer.
All such notices shall be deemed to have been given
when received in person, telecopied with receipt confirmed, or mailed by first
class mail, postage prepaid except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
SECTION 5.4 Benefit
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This Common Securities Guarantee is solely for the
benefit of the Holders of the Common Securities and is not separately
transferable from the Common Securities.
SECTION 5.5 Governing Law
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THIS COMMON SECURITIES GUARANTEE SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.
THIS COMMON SECURITIES GUARANTEE is executed as of
the day and year first above written.
AMERICAN ANNUITY GROUP, INC.
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
Title: Senior Vice President, Secretary
& General Counsel
