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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 23, 2000
REGISTRATION NO. 333-49666
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 2
TO
FORM S-3 REGISTRATION STATEMENT
AND
POST-EFFECTIVE AMENDMENT NO. 3
TO
FORM S-3 REGISTRATION STATEMENT
(NO. 333-12617)
UNDER
THE SECURITIES ACT OF 1933
HARTFORD CAPITAL III
HARTFORD CAPITAL IV
THE HARTFORD FINANCIAL SERVICES GROUP, INC. HARTFORD CAPITAL V
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE DELAWARE
(STATE OR OTHER JURISDICTION OF INCORPORATION OR (STATE OR OTHER JURISDICTION OF INCORPORATION OR
ORGANIZATION) ORGANIZATION OF EACH REGISTRANT)
06-6431735
(HARTFORD CAPITAL III)
06-6431736
13-3317783 (HARTFORD CAPITAL IV)
(I.R.S. EMPLOYER IDENTIFICATION NUMBER) TO BE APPLIED FOR
(HARTFORD CAPITAL V)
(I.R.S. EMPLOYER IDENTIFICATION NUMBERS)
C/O THE HARTFORD FINANCIAL SERVICES GROUP, INC.
HARTFORD PLAZA HARTFORD PLAZA
HARTFORD, CONNECTICUT 06115 HARTFORD, CONNECTICUT 06115
(860) 547-5000 (860) 547-5000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANTS' PRINCIPAL EXECUTIVE INCLUDING AREA
OFFICES) CODE, OF REGISTRANTS' PRINCIPAL EXECUTIVE OFFICES)
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Please address a copy of all communications to:
KATHERINE VINES TRUMBULL JAMES C. SCOVILLE
VICE PRESIDENT AND CORPORATE SECRETARY DEBEVOISE & PLIMPTON
THE HARTFORD FINANCIAL SERVICES GROUP, INC. 875 THIRD AVENUE
HARTFORD PLAZA NEW YORK, NEW YORK 10022
HARTFORD, CONNECTICUT 06115 (212) 909-6000
(860) 547-5000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE OF EACH
REGISTRANT)
APPROXIMATE DATE OF COMMENCEMENT OF THE PROPOSED SALE TO THE PUBLIC: From time
to time after this Registration Statement becomes effective.
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]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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Pursuant to Rule 429 under the Securities Act of 1933, this Registration
Statement includes a Prospectus which may relate to a total of $126,975,000 of
securities previously registered by the Registrants under their Registration
Statement on Form S-3 (No. 333-12617), which was declared effective on October
2, 1996. In the event any of such previously registered and unsold Securities
are offered and sold prior to the effective date of this Registration Statement,
the amount of such Securities will not be included in such Prospectus hereunder.
This Registration Statement also constitutes Post-Effective Amendment No. 3
to the Registration Statement on Form S-3 (No. 333-12617). Such Post-Effective
Amendment shall hereafter become effective concurrently with the effectiveness
of this Registration Statement in accordance with Section 8(c) of the Securities
Act of 1933.
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT AND POST-EFFECTIVE
AMENDMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY THEIR EFFECTIVE
DATE UNTIL THE REGISTRANTS SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY
STATES THAT THIS REGISTRATION STATEMENT AND POST-EFFECTIVE AMENDMENT SHALL
THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES
ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT AND POST-EFFECTIVE AMENDMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(a), MAY DETERMINE.
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THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED.
WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS
PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND WE ARE NOT
SOLICITING OFFERS TO BUY THE SECURITIES IN ANY STATE WHERE THE OFFER OR
SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION DATED JANUARY 23, 2001
PROSPECTUS
THE HARTFORD FINANCIAL SERVICES GROUP, INC.
DEBT SECURITIES
JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES
PREFERRED STOCK
COMMON STOCK
DEPOSITARY SHARES
WARRANTS
STOCK PURCHASE CONTRACTS
STOCK PURCHASE UNITS
HARTFORD CAPITAL III
HARTFORD CAPITAL IV
HARTFORD CAPITAL V
PREFERRED SECURITIES GUARANTEED
AS DESCRIBED IN THIS PROSPECTUS
AND THE ACCOMPANYING PROSPECTUS SUPPLEMENT
BY THE HARTFORD FINANCIAL SERVICES GROUP, INC.
By this prospectus, we may offer from time to time up to $1,126,975,000 of
any combination of the securities described in this prospectus.
We will provide specific terms of the securities in supplements to this
prospectus. You should read this prospectus and any supplement carefully before
you invest. A supplement may also change or update information contained in this
prospectus.
We will not use this prospectus to confirm sales of any of our securities
unless it is attached to a prospectus supplement.
Unless we state otherwise in a prospectus supplement, we will not list any
of these securities on any securities exchange.
Neither the Securities and Exchange Commission nor any state securities
commission has determined whether this prospectus is truthful or complete. They
have not made, nor will they make, any determination as to whether anyone should
buy these securities. Any representation to the contrary is a criminal offense.
THE DATE OF THIS PROSPECTUS IS --, 2001
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TABLE OF CONTENTS
PAGE
----
About This Prospectus....................................... ii
The Hartford Financial Services Group, Inc.................. 1
The Hartford Capital Trusts................................. 2
Use of Proceeds............................................. 4
Ratio of Earnings to Fixed Charges.......................... 4
Description of the Debt Securities.......................... 5
Description of Junior Subordinated Debentures............... 17
Description of Capital Stock of The Hartford Financial
Services Group, Inc....................................... 28
Description of Warrants..................................... 37
Description of Stock Purchase Contracts and Stock Purchase
Units..................................................... 38
Description of Preferred Securities......................... 39
Description of Guarantee.................................... 51
Description of Corresponding Junior Subordinated
Debentures................................................ 53
Relationship Among the Preferred Securities, the
Corresponding Junior Subordinated Debentures and the
Guarantees................................................ 56
Plan of Distribution........................................ 58
Legal Opinions.............................................. 59
Experts..................................................... 59
Where You Can Find More Information......................... 59
Incorporation by Reference.................................. 59
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ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
Securities and Exchange Commission utilizing a "shelf" registration process.
Under this shelf process, we may sell the securities described in the prospectus
from time to time. This prospectus provides you with a general description of
the securities we may offer. We may also add, update or change information
contained in this prospectus through a supplement to this prospectus. Any
statement that we make in this prospectus will be modified or superseded by any
inconsistent statement made by us in a prospectus supplement. You should read
both this prospectus and any prospectus supplement together with additional
information described under the heading "Where You Can Find More Information."
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THE HARTFORD FINANCIAL SERVICES GROUP, INC.
We are a holding company that owns, directly and indirectly, a number of
insurance companies. Our insurance companies are among the largest providers of
both property and casualty insurance and life insurance products in the United
States. Hartford Fire Insurance Company, or Hartford Fire, founded in 1810, is
the oldest of our subsidiaries. Our companies write insurance and reinsurance in
the United States and internationally. At September 30, 2000, our total assets
and total stockholders' equity were $177.2 billion and $6.7 billion,
respectively.
We were formed as a Delaware corporation in December 1985 as a wholly-owned
subsidiary of ITT Corporation. On December 19, 1995, all our outstanding shares
were distributed to ITT Corporation's stockholders and we became an independent
company. On May 2, 1997, we changed our name from ITT Hartford Group, Inc. to
our current name, The Hartford Financial Services Group, Inc.
As a holding company that is separate and distinct from our insurance
subsidiaries, we have no significant business operations of our own. Therefore,
we rely on the dividends from our insurance company subsidiaries, which are
primarily domiciled in Connecticut, as the principal source of cash flow to meet
our obligations. These obligations include payments on our debt securities and
the payment of dividends on our capital stock, including preferred stock. The
Connecticut insurance holding company laws limit the payment of dividends by
Connecticut-domiciled insurers. Under these laws, the insurance subsidiaries may
only make their dividend payments out of unrestricted surplus. In addition, the
state insurance commissioner must approve those subsidiaries paying us dividends
if the dividend and other dividends or distributions made within the preceding
twelve months exceeds the greater of:
- 10% of the insurer's policyholder surplus as of December 31 of the
preceding year or
- net income, or net gain from operations if the subsidiary is a life
insurance company, for the previous calendar year, in each case
determined under statutory insurance accounting principles.
The insurance holding company laws of the other jurisdictions in which our
insurance subsidiaries are incorporated generally contain similar, and in some
instances more restrictive, limitations on the payment of dividends. Our
insurance subsidiaries were permitted to pay to us up to a maximum of $1.0
billion in dividends in 2000 without prior approval.
Our rights to participate in any distribution of assets of any of our
subsidiaries for example, upon their liquidation or reorganization, and thus the
ability of holders of the securities to benefit indirectly from a distribution
are subject to the prior claims of creditors of the applicable subsidiary,
except to the extent that we may be a creditor of that subsidiary. Claims on
these subsidiaries by persons other than us include, as of September 30, 2000,
claims by policyholders for benefits payable amounting to $38.7 billion, claims
by separate account holders of $119.6 billion, claims of trade creditors, claims
from guaranty associations and claims from holders of debt obligations amounting
to $6.8 billion.
Our principal executives offices are located at Hartford Plaza, Hartford,
Connecticut 06115, and our telephone number is (860) 547-5000.
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THE HARTFORD CAPITAL TRUSTS
We created each trust as a statutory Delaware business trust pursuant to a
trust agreement. We will enter into an amended and restated trust agreement for
each trust, which will state the terms and conditions for the trust to issue and
sell its preferred securities and common securities. We will amend and restate
each trust agreement in its entirety substantially in the form filed as an
exhibit to the Registration Statement which includes this prospectus. Each trust
agreement will be qualified as an indenture under the Trust Indenture Act of
1939, as amended, which we refer to in this prospectus as the "Trust Indenture
Act."
Each trust exists for the exclusive purposes of:
- issuing and selling to the public preferred securities, representing
undivided beneficial interests in the assets of the trust,
- issuing and selling to us common securities, representing undivided
beneficial interests in the assets of the trust,
- using the proceeds from the sale of the preferred securities and common
securities to acquire a corresponding series of junior subordinated
deferrable interest debentures, which we refer to in this prospectus as
the "corresponding junior subordinated debentures,"
- distributing the cash payments it receives from the corresponding junior
subordinated debentures it owns to you and the other holders of preferred
securities and us, as the holder of common securities, and
- engaging in the other activities that are necessary or incidental to
these purposes.
Accordingly, the corresponding junior subordinated debentures will be the
sole assets of the trust, and payments under the corresponding junior
subordinated debentures and the related expense agreement will be the sole
revenue of the trust.
We will own all of the common securities of each trust. The common
securities of a trust will rank equally with and payments will be made pro rata
with the preferred securities of the trust, except that if an event of default
under a trust agreement then exists, our rights as holder of the common
securities to payment of distributions and payments upon liquidation or
redemption will be subordinated to your rights as a holder of the preferred
securities of the trust. See "Description of Preferred Securities --
Subordination of Common Securities."
We will acquire common securities in an aggregate liquidation amount equal
to not less than 3% of the total capital of each trust. The preferred securities
will represent the remaining approximately 97% of each trust's total
capitalization.
Unless we state otherwise in a prospectus supplement, each trust has a term
of approximately 45 years. A trust may also terminate earlier. The trustees of
each trust will conduct its business and affairs. As holder of the common
securities we will appoint the trustees. Initially, the trustees will be:
- Wilmington Trust Company, which will act as property trustee and as
Delaware trustee, and
- Two of our employees or officers or those of our affiliates, who will act
as administrative trustees.
Wilmington Trust Company, as property trustee, will act as sole indenture
trustee under each trust agreement for purposes of compliance with the
provisions of the Trust Indenture Act. Wilmington Trust Company will also act as
trustee under the guarantee and the junior subordinated indenture pursuant to
which we will issue the junior subordinated debentures. See "Description of
Junior Subordinated Debentures" and "Description of Guarantee."
The holder of the common securities of a trust, or the holders of a
majority in liquidation preference of the preferred securities if an event of
default under the trust agreement for the trust has occurred and is continuing,
will be entitled to appoint, remove or replace the property trustee and/or the
Delaware trustee of the trust. You will not have the right to vote to appoint,
remove or replace the administrative trustees. Only we, as the holder of the
common securities, will have these voting rights. The duties and obligations
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of the trustees are governed by the applicable trust agreement. We will pay all
fees and expenses related to the trusts and the offering of the preferred
securities and will pay, directly or indirectly, all ongoing costs, expenses and
liabilities of the trusts.
The principal executive office of each trust is Hartford Plaza, Hartford,
Connecticut 06115, Attention: Secretary, and its telephone number is (860)
547-5000.
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USE OF PROCEEDS
Unless we state otherwise in a prospectus supplement, we intend to use the
proceeds from the sale of the securities offered by this prospectus, including
the corresponding junior subordinated debentures issued to the trusts in
connection with their investment of all the proceeds from the sale of preferred
securities, for general corporate purposes, including working capital, capital
expenditures, investments in loans to subsidiaries, acquisitions and refinancing
of debt, including outstanding commercial paper and other short-term
indebtedness. We will include a more detailed description of the use of proceeds
of any specific offering of securities in the prospectus supplement relating to
the offering.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth our ratio of consolidated earnings to fixed
charges for the years and the periods indicated:
NINE MONTHS
ENDED
SEPTEMBER 30, YEAR ENDED DECEMBER 31,
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2000 1999 1999 1998 1997 1996 1995
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Ratio of Consolidated Earnings to Fixed
Charges(1)..................................... 5.0 5.4 5.4 6.5 7.5 $(318) 5.8
Ratio of Consolidated Earnings to Fixed Charges,
including Interest Credited to
Contractholders(2)............................. 1.9 1.8 1.8 1.8 2.2 $(318) 1.6
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(1) Excluding the equity gain on the Hartford Life, Inc. initial public offering
of $368 million, the consolidated earnings to fixed charges ratio was 6.1
for the year ended December 31, 1997. The December 31, 1996 consolidated
earnings to fixed charges ratio, excluding other charges of $1.1 billion,
before tax, primarily related to environmental and asbestos reserve
increases and recognition of losses on guaranteed investment contract
business, was 5.0.
(2) Excluding the equity gain on the Hartford Life, Inc. initial public offering
of $368 million, the consolidated earnings to fixed charges ratio, including
interest credited to contractholders, was 1.9 for the year ended December
31, 1997. The December 31, 1996 consolidated earnings to fixed charges
ratio, including interest credited to contractholders, excluding other
charges of $1.1 billion, before tax, primarily related to environmental and
asbestos reserve increases and recognition of losses on guaranteed
investment contract business, was 1.5.
For purposes of computing the ratio of consolidated earnings to fixed
charges, "earnings" consists of income from operations before federal income
taxes and fixed charges. "Fixed charges" consists of interest expense,
capitalized interest, amortization of debt expense, an imputed interest
component for rental expense and dividend requirements on preferred stock of
Hartford Fire. "Fixed charges, including interest credited to contractholders"
also includes all interest paid or credited to the holders of our policies,
annuities and investment contracts.
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DESCRIPTION OF THE DEBT SECURITIES
We may offer unsecured senior debt securities or subordinated debt
securities. We refer to the senior debt securities and the subordinated debt
securities together in this prospectus as the "debt securities". The senior debt
securities will rank equally with all of our other unsecured, unsubordinated
obligations. The subordinated debt securities will be subordinate and junior in
right of payment to all of our senior debt.
We will issue the senior debt securities in one or more series under an
indenture, which we refer to as the "senior indenture", dated as of October 20,
1995, between us and The Chase Manhattan Bank, as trustee. We will issue
subordinated debt securities in one or more series under an indenture, which we
refer to as the "subordinated indenture", between us and the trustee to be named
in the prospectus supplement relating to the offering of subordinated debt
securities.
The following description of the terms of the indentures is a summary. It
summarizes only those portions of the indentures which we believe will be most
important to your decision to invest in our debt securities. You should keep in
mind, however, that it is the indentures, and not this summary, which defines
your rights as a debtholder. There may be other provisions in the indentures
which are also important to you. You should read the indentures for a full
description of the terms of the debt. The senior indenture and the subordinated
indenture are filed as exhibits to the Registration Statement that includes this
prospectus. See "Where You Can Find More Information" for information in how to
obtain copies of the senior indenture and the subordinated indenture.
THE DEBT SECURITIES ARE UNSECURED OBLIGATIONS
Our debt securities will be unsecured obligations. Our senior debt
securities will be unsecured and will rank equally with all of our other
unsecured and unsubordinated obligations. As a non-operating holding company
most of our operating assets and the assets of our consolidated subsidiaries are
owned by our subsidiaries. We rely primarily on dividends from these
subsidiaries to meet our obligations for payment of principal and interest on
our outstanding debt obligations and corporate expenses. Accordingly, the debt
securities will be effectively subordinated to all existing and future
liabilities of our subsidiaries, and you should rely only on our assets for
payments on the debt securities. The payment of dividends by our insurance
subsidiaries, including Hartford Fire, is limited under the insurance holding
company laws in the jurisdictions where those subsidiaries are domiciled. See
"The Hartford Financial Services Group, Inc."
Unless we state otherwise in the applicable prospectus supplement, the
indentures do not limit us from incurring or issuing other secured or unsecured
debt under either of the indentures or any other indenture that we may have
entered into or enter into in the future. See "-- Subordination under the
Subordinated Indenture" and the prospectus supplement relating to any offering
of subordinated debt securities.
TERMS OF THE DEBT SECURITIES
We may issue the debt securities in one or more series through an indenture
that supplements the senior indenture or the subordinated indenture or through a
resolution of our board of directors or an authorized committee of our board of
directors.
You should refer to the applicable prospectus supplement for the specific
terms of the debt securities. These terms may include the following:
- title of the debt securities,
- any limit upon the aggregate principal amount,
- maturity date(s) or the method of determining the maturity date(s),
- interest rate(s),
- dates on which interest will be payable and circumstances in which
interest may be deferred, if any,
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- dates from which interest will accrue and the method of determining dates
from which interest will accrue,
- place or places where we may pay principal, premium, if any, and interest
and where you may present the debt securities for registration or
transfer or exchange,
- place or places where notices and demands relating to the debt securities
and the indentures may be made,
- redemption or early payment provisions,
- sinking fund or similar provisions,
- authorized denominations if other than denominations of $1,000,
- currency, currencies, or currency units, if other than in U.S. dollars in
which the principal of, premium, if any, and interest on the debt
securities is payable, or in which the debt securities are denominated,
- any additions, modifications or deletions, in the event of default or
covenants of The Hartford Financial Services Group, Inc. specified in the
indenture relating to the debt securities,
- if other than the principal amount of the debt securities, the portion of
the principal amount of the debt securities that is payable upon
declaration of acceleration of maturity,
- any additions or changes to the indenture necessary to permit or
facilitate issuing the series in bearer form, registrable or not
registrable as to principal, and with or without interest coupons,
- any index or indices used to determine the amount of payments of
principal of and premium, if any, on the debt securities and the method
of determining these amounts,
- whether a temporary global security will be issued and the terms upon
which these temporary debt securities may be exchanged for definitive
debt securities,
- whether the debt securities will be issued in whole or in part in the
form of one or more global securities,
- identity of the depositary for global securities,
- appointment of any paying agent(s),
- the terms and conditions of any obligation or right we would have or any
option you would have to convert or exchange the debt securities into
other securities,
- in the case of the subordinated indenture, any provisions regarding
subordination, and
- additional terms not inconsistent with the provisions of the indentures.
Debt securities may also be issued under the indentures upon the exercise
of the warrants. See "Description of Warrants."
SPECIAL PAYMENT TERMS OF THE DEBT SECURITIES
We may issue one or more series of debt securities at a substantial
discount below their stated principal amount. These may bear no interest or
interest at a rate which at the time of issuance is below market rates. We will
describe United States federal tax consequences and special considerations
relating to any series in the applicable prospectus supplement.
The purchase price of any of the debt securities may be payable in one or
more foreign currencies or currency units. The debt securities may be
denominated in one or more foreign currencies or currency units, or the
principal of, premium, if any, or interest on any debt securities may be payable
in one or more foreign currencies or currency units. We will describe the
restrictions, elections, federal income tax
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considerations, specific terms and other information relating to the debt
securities and the foreign currency units in the applicable prospectus
supplement.
If we use any index to determine the amount of payments of principal, of
premium, if any, or interest on any series of debt securities, we will also
describe the special federal income tax, accounting and other considerations
applicable to the debt securities in the applicable prospectus supplement.
DENOMINATIONS, REGISTRATION AND TRANSFER
We expect to issue most debt securities in fully registered form without
coupons and in denominations of $1,000 and any integral multiple of $1,000.
Except as we may describe in the applicable prospectus supplement, debt
securities of any series will be exchangeable for other debt securities of the
same issue and series, of any authorized denominations, of a like aggregate
principal amount and bearing the same interest rate.
You may present debt securities for exchange as described above, or for
registration of transfer, at the office of the securities registrar or at the
office of any transfer agent we designate for that purpose. You will not incur a
service charge but you must pay any taxes and other governmental charges as
described in the indenture. We will appoint the trustees as securities registrar
under the indentures. We may at any time rescind the designation of any transfer
agent that we initially designate or approve a change in the location through
which the transfer agent acts. We will specify the transfer agent in the
applicable prospectus supplement. We may at any time designate additional
transfer agents.
GLOBAL DEBT SECURITIES
We may issue all or any part of a series of debt securities in the form of
one or more global securities. We will identify the depository holding the
global debt securities in the applicable prospectus supplement. We will issue
global securities in registered form and in either temporary or definitive form.
Unless it is exchanged for the individual debt securities, a global security may
not be transferred except:
- by the depositary to its nominee,
- by a nominee of the depositary to the depositary or another nominee, or
- by the depositary or any nominee to a successor of the depositary, or a
nominee of the successor.
We will describe the specific terms of the depositary arrangement in the
applicable prospectus supplement. We expect that the following provisions will
generally apply to these depositary arrangements.
Beneficial Interests in a Global Security
If we issue a global security, the depositary for the global security or
its nominee will credit on its book-entry registration and transfer system the
principal amounts of the individual debt securities represented by the global
security to the accounts of persons that have accounts with it. We refer to
those persons as "participants" in this prospectus. The accounts will be
designated by the dealers, underwriters or agents for the debt securities, or by
us if the debt securities are offered and sold directly by us. Ownership of
beneficial interests in a global security will be limited to participants or
persons who may hold interests through participants. Ownership and transfers of
beneficial interests in the global security will be shown on, and transactions
can be effected only through, records maintained by the applicable depositary or
its nominee, for interests of participants, and the records of participants, for
interests of persons who hold through participants. The laws of some states
require that you take physical delivery of securities in definitive form. These
limits and laws may impair your ability to transfer beneficial interests in a
global security.
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So long as the depositary or its nominee is the registered owner of a
global security, the depositary or nominee will be considered the sole owner or
holder of the debt securities represented by the global security for all
purposes under the indenture. Except as provided below, you:
- will not be entitled to have any of the individual debt securities
represented by the global security registered in your name,
- will not receive or be entitled to receive physical delivery of any debt
securities in definitive form, and
- will not be considered the owner or holder of the debt securities under
the indenture.
Payments of Principal, Premium and Interest
We will make principal, premium and interest payments on global securities
to the depositary that is the registered holder of the global security or its
nominee. The depositary for the global securities will be solely responsible and
liable for all payments made on account of your beneficial ownership interests
in the global security and for maintaining, supervising and reviewing any
records relating to your beneficial ownership interests.
We expect that the depositary or its nominee, upon receipt of any
principal, premium or interest payment immediately will credit participants'
accounts with amounts in proportion to their respective beneficial interests in
the principal amount of the global security as shown on the records of the
depositary or its nominee. We also expect that payments by participants to you,
as an owner of a beneficial interest in the global security held through those
participants, will be governed by standing instructions and customary practices,
as it is now the case with securities held for the accounts of customers in
bearer form or registered in "street name." These payments will be the
responsibility of those participants.
Issuance of Individual Debt Securities
Unless we state otherwise in the applicable prospectus supplement, if a
depositary for a series of debt securities is at any time unwilling, unable or
ineligible to continue as depositary and we do not appoint a successor
depositary within 90 days, we will issue individual debt securities in exchange
for the global security. In addition, we may at any time and in our sole
discretion, subject to any limitations described in the prospectus supplement
relating to the debt securities, determine not to have any debt securities
represented by one or more global securities. If that occurs, we will issue
individual debt securities in exchange for the global security.
Further, we may specify that you may, on terms acceptable to us, the
trustee and the depositary, receive individual debt securities in exchange for
your beneficial interest in a global security, subject to any limitations
described in the prospectus supplement relating to the debt securities. In that
instance, you will be entitled to physical delivery of individual debt
securities equal in principal amount to that beneficial interest and to have the
debt securities registered in your name. Unless we otherwise specify, we will
issue those individual debt securities in denominations of $1,000 and integral
multiples of $1,000.
PAYMENT AND PAYING AGENTS
Unless we state otherwise in an applicable prospectus supplement, we will
pay principal of, premium, if any, and interest on your debt securities at the
office of the trustee for your debt securities in the City of New York or at the
office of any paying agent that we may designate. In addition, we may pay
interest:
- by check mailed to the address of the person entitled to the payment that
appears in the securities register, or
- by transfer to an account maintained by the person entitled to the
payment as specified in the securities register.
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Unless we state otherwise in an applicable prospectus supplement, we will
pay any interest on debt securities to the registered owner of the debt security
at the close of business on the record date for the interest, except in the case
of defaulted interest. We may at any time designate additional paying agents or
rescind the designation of any paying agent. We must maintain a paying agent in
each place of payment for the debt securities.
Any moneys deposited with the trustee or any paying agent, or then held by
us in trust, for the payment of the principal of, premium, if any, and interest
on any debt security that remain unclaimed for two years after the principal,
premium or interest has become due and payable will, at our request, be repaid
to us. After repayment to us, you are entitled to seek payment only from us as a
general unsecured creditor.
REDEMPTION
Unless we state otherwise in an applicable prospectus supplement, debt
securities will not be subject to any sinking fund and will not be redeemable
prior to their stated maturity except as described below.
We may, at our option, redeem any series of debt securities on any interest
payment date in whole or in part. We may redeem debt securities in denominations
larger than $1,000 but only in integral multiples of $1,000.
Redemption Price
Except as we may otherwise specify in the applicable prospectus supplement,
the redemption price for any debt security which we redeem will equal any
accrued and unpaid interest to the redemption date, plus the greater of:
- the principal amount, and
- an amount equal to:
- for debt securities bearing interest at a fixed rate, the discounted
remaining fixed amount payments, calculated as described below, or
- for debt securities bearing interest determined by reference to a
floating rate, the discounted swap equivalent payments, calculated
as described below, to determine any redemption premium based upon
the value of interest payable on an equivalent fixed rate debt
security.
The discounted remaining fixed amount payments will equal the sum of the
current values of the amounts of interest and principal that would have been
payable by us on each interest payment date after the redemption date and at
stated maturity of the final payment of principal. This calculation will take
into account any required sinking fund payments, but will otherwise assume that
we have not redeemed the debt security prior to the stated maturity.
The current value of any amount is the present value of that amount on the
redemption date after discounting that amount on a semiannual basis, from the
originally scheduled date for payment. We will use the treasury rate to
calculate this present value.
The treasury rate is a per annum rate, determined on the redemption date to
be the per annum rate equal to the semiannual bond equivalent yield to maturity
for United States Treasury securities maturing at the stated maturity of the
final payment of principal of the debt securities redeemed. We will determine
this rate by reference to the weekly average yield to maturity for United States
Treasury securities maturing on that stated maturity, if reported in the most
recent Statistical Release H.15(519) of the Board of Governors of the Federal
Reserve. If no such securities mature at the stated maturity, we will determine
the rate by interpolation between the most recent weekly average yields to
maturity for two series of United States Treasury securities, (1) one maturing
as close as possible to, but earlier than, the stated maturity and (2) the other
maturing as close as possible to, but later than, the stated maturity, in
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each case as published in the most recent Statistical Release H.15(519) of the
Board of Governors of the Federal Reserve.
The discounted swap equivalent payments will equal the sum of:
- the current value of the amount of principal that would have been payable
by us at the stated maturity of the final payment of the principal of the
debt securities redeemed. This calculation will take into account any
required sinking fund payments, but will otherwise assume that we had not
redeemed the debt security prior to the stated maturity, and
- the sum of the current values of the fixed rate payments that leading
interest rate swap dealers would require to be paid by an assumed fixed
rate payer having the same credit standing as ours against floating rate
payments to be made by these leading dealers equal to the interest
payments on the debt securities being redeemed, taking into account any
required sinking fund payments but otherwise assuming we had not redeemed
the debt securities prior to the stated maturity, under a standard
interest rate swap agreement having a notional principal amount equal to
the principal amount of the debt securities, a termination date set at
the stated maturity of the debt security and payment dates for both fixed
and floating rate payers set at each interest payment date of the debt
securities. The amount of the fixed rate payments will be based on
quotations received by the trustee, or an agent appointed for that
purpose, from four leading interest rate swap dealers or, if quotations
from four leading interest rate swap dealers are not obtainable, three
leading interest rate swap dealers.
Notice of Redemption
We will mail notice of any redemption of your debt securities at least 30
days but not more than 60 days before the redemption date to you at your
registered address. Unless we default in payment of the redemption price, on and
after the redemption date interest will cease to accrue on the debt securities
or the portions called for redemption.
CONSOLIDATION, MERGER AND SALE OF ASSETS
We will not consolidate with or merge into any other corporation or convey,
transfer or lease our properties and assets substantially as an entirety to any
person, and no person may consolidate with or merge into us or convey, transfer
or lease to us its properties and assets substantially as an entirety, unless:
- if we consolidate with or merge into another corporation or convey or
transfer our properties and assets substantially as an entirety to any
person, the successor corporation is organized under the laws of the
United States of America or any state or the District of Columbia, and
the successor corporation expressly assumes our obligations relating to
the debt securities,
- immediately after giving effect to the consolidation, merger, conveyance
or transfer, there exists no event of default, and no event which, after
notice or lapse of time or both, would become an event of default, and
- other conditions described in the indenture are met.
The general provisions of the indenture do not protect you against
transactions, such as a highly leveraged transaction, that may adversely affect
you.
LIMITATIONS UPON LIENS
The indentures provide that neither we nor our subsidiaries may issue,
assume or guarantee any indebtedness for money borrowed if the indebtedness is
secured by a lien upon any of our principal property, any restricted
subsidiaries, or on any shares of stock of any restricted subsidiary, whether
the principal property or shares of stock are now owned or later acquired.
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General Exceptions
The indentures permit us to incur secured debt if we provide that the debt
securities will be secured equally and ratably with or in priority to the new
secured indebtedness. We may also provide that our other indebtedness, including
indebtedness guaranteed by us or the restricted subsidiary, will be secured
equally with or in priority to the new secured indebtedness. Further, the
restriction on incurring secured indebtedness will not apply to:
- liens on property or shares of stock of any corporation existing at the
time the corporation becomes a restricted subsidiary,
- liens on property existing at the time it is acquired, or liens on
property which secure the payment of the purchase price of the property,
or liens on property which secure indebtedness incurred or guaranteed for
the purpose of financing the purchase price of the property or the
construction of that property, including improvements to existing
property, which indebtedness is incurred or guaranteed within 180 days
after the latest of the acquisition or completion of construction or
commencement of operation of the property,
- liens securing indebtedness owing by any restricted subsidiary to us or a
wholly owned restricted subsidiary,
- liens on the property of a corporation existing at the time the
corporation is merged into or consolidated with us or a restricted
subsidiary or at the time of a purchase, lease or other acquisition of
the properties of a corporation or other person as an entirety or
substantially as an entirety by us or a restricted subsidiary,
- liens on our property or the property of a restricted subsidiary in favor
of the United States of America or any State, agency, instrumentality or
political subdivision of the United States of America, or in favor of any
other country, or any political subdivision of that country, to secure
any indebtedness incurred or guaranteed for the purpose of financing all
or any part of the purchase price or the cost of construction of the
property subject to those liens within 180 days after the latest of the
acquisition, completion of construction or commencement of operation of
that property, and
- any extension, renewal or replacement of any lien referred to in the five
preceding clauses.
Exceptions for Specified Amount of Indebtedness
We and one or more restricted subsidiaries may, without securing the debt
securities, issue, assume or guarantee secured indebtedness which would
otherwise be subject to the above restrictions, provided that after doing so the
aggregate amount of this indebtedness does not exceed 10% of consolidated net
tangible assets. In computing the aggregate amount of indebtedness outstanding
for purposes of the previous sentence, indebtedness issued, assumed or
guaranteed pursuant to the above clauses is not included.
When we use the term "consolidated net tangible assets", we mean the total
amount of assets, less applicable reserves and other properly deductible items,
after deducting:
- all current liabilities, excluding any liabilities which are by their
terms extendible or renewable at the option of the obligor to a time more
than 12 months after the time as of which the amount is being computed,
and
- all segregated goodwill, trade names, trademarks, patents, unamortized
debt discount and expense and other like intangibles, all as set forth on
the most recent balance sheet of The Hartford Financial Services Group,
Inc. and its consolidated subsidiaries and prepared in accordance with
generally accepted accounting principles. Our subsidiaries include any
corporation where more than 50% of its voting stock is owned by us or by
another subsidiary.
When we use the term "principal property", we mean all land, buildings,
machinery and equipment, and leasehold interests and improvements relating to
these items, which would be reflected on our
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consolidated balance sheet prepared in accordance with generally accepted
accounting principles, excluding all tangible property located outside the
United States of America and excluding any tangible property which, in the
opinion of our board of directors set forth in a board resolution, is not
material to us and our consolidated subsidiaries taken as a whole.
When we use the term "restricted subsidiary", we mean any subsidiary which
is incorporated under the laws of any state of the United States or of the
District of Columbia, and which is a regulated insurance company principally
engaged in one or more of the property, casualty and life insurance businesses.
However, no subsidiary is a restricted subsidiary:
- if the total assets of that subsidiary are less than 10% of our total
assets and the total assets of our consolidated subsidiaries, including
that subsidiary, in each case as set forth on the most recent fiscal
year-end balance sheets of the subsidiary and us and our consolidated
subsidiaries, respectively, and computed in accordance with generally
accepted accounting principles, or
- if in the judgment of our board of directors, as evidenced by a board
resolution, the subsidiary is not material to the financial condition of
us and our subsidiaries taken as a whole.
As of the date of this prospectus, the following subsidiaries meet the
definition of restricted subsidiaries: Hartford Fire, Hartford Life Insurance
Company, Hartford Life and Accident Insurance Company and Hartford Life and
Annuity Insurance Company.
MODIFICATION AND WAIVER
Modification
We and the trustee may modify and amend each indenture with the consent of
the holders of a majority in aggregate principal amount of the series of debt
securities affected. However, no modification or amendment may, without the
consent of the holder of each outstanding debt security affected:
- change the stated maturity of the principal of, or any installment of
interest on, any outstanding debt security,
- reduce the principal amount of, or the rate of interest on or any premium
payable upon the redemption of, or the amount of principal of an original
issue discount security that would be due and payable upon a declaration
of acceleration of the maturity of, any outstanding debt security,
- change the place of payment, or the coin or currency in which any
outstanding debt security or the interest is payable,
- impair your right to institute suit for the enforcement of any payment on
or relating to any outstanding debt security after the stated maturity,
or
- change the amendment provisions of the indenture requiring the consent of
the affected holders for waiver of compliance with the indenture or
waiver of past defaults.
Waiver
The holders of a majority in principal amount of the outstanding debt
securities of a series may, on behalf of the holders of all debt securities of
that series, waive compliance by us with restrictive covenants of the indenture
which relate to that series.
The holders of not less than a majority in principal amount of the
outstanding debt securities of a series may, on behalf of the holders of that
series, generally waive any past default under the indenture relating to that
series of debt securities. However, a default in the payment of the principal
of, or any interest on, any debt security of that series or relating to a
provision which under the indenture cannot be modified or amended without the
consent of the holder of each outstanding debt security of that series affected
cannot be so waived.
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EVENTS OF DEFAULT
Under the terms of each indenture, each of the following constitutes an
event of default for a series of debt securities:
- default for 30 days in the payment of any interest when due,
- default in the payment of principal, or premium, if any, at maturity,
- default in the performance of any other covenant in the indenture for 60
days after written notice,
- our bankruptcy, insolvency or reorganization,
- acceleration or default in the payment of indebtedness for borrowed money
in excess of $25,000,000, which has not been rescinded or annulled within
30 day after notice, or
- any other event of default described in the applicable board resolution
or supplemental indenture under which the series of debt securities is
issued.
We are required to furnish the trustee annually with a statement as to the
fulfillment of our obligations under the indenture. Each indenture provides that
the trustee may withhold notice to you of any default, except in respect of the
payment of principal or interest on the debt securities, if it considers it in
the interests of the holders of the debt securities to do so.
Effect of an Event of Default
If an event of default exists, the trustee or the holders of not less than
25% in principal amount of a series of debt securities may declare the principal
amount, or, if the debt securities are original issue discount securities, the
portion of the principal amount as may be specified in the terms of that series,
of the debt securities of that series to be due and payable immediately, by a
notice in writing to us, and to the trustee if given by holders. Upon that
declaration the principal will become immediately due and payable. However, at
any time after a declaration of acceleration has been made, but before a
judgment or decree for payment of the money due has been obtained, the holders
of a majority in principal amount of outstanding debt securities may, subject to
conditions specified in the indenture, rescind and annul that declaration.
Subject to the provisions of the indentures relating to the duties of the
trustee, if an event of default then exists, the trustee will be under no
obligation to exercise any of its rights or powers under the indenture at your
request, order or direction, unless you have offered to the trustee reasonable
security or indemnity. Subject to the provisions for the security or
indemnification of the trustee, the holders of a majority in principal amount of
a series of outstanding debt securities have the right to direct the time,
method and place of conducting and proceeding for and remedy available to the
trustee, or exercising any trust or power conferred on the trustee in connection
with the debt securities of that series.
Legal Proceedings and Enforcement of Right to Payment
You will not have any right to institute any proceeding in connection with
the indenture or for any remedy under the indenture, unless you have previously
given to the trustee written notice of a continuing event of default with
respect to debt securities of that series. In addition, the holders of at least
25% in principal amount of the outstanding debt securities must have made
written request, and offered reasonable indemnity, to the trustee to institute
that proceeding as trustee, and, within 60 days following the receipt of that
notice, the trustee must not have received from the holders of a majority in
principal amount of the outstanding debt securities of that series a direction
inconsistent with that request, and must have failed to institute the
proceeding. However, you will have an absolute right to receive payment of the
principal of, premium, if any, and interest on that debt security on or after
the due dates expressed in the debt security and to institute a suit for the
enforcement of that payment.
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SATISFACTION AND DISCHARGE
Each indenture provides that when, among other things, all debt securities
not previously delivered to the trustee for cancellation:
- have become due and payable, or
- will become due and payable at their stated maturity within one year and
we deposit or cause to be deposited with the trustee, in trust, an amount
in the currency or currencies in which the debt securities are payable
sufficient to pay and discharge the entire indebtedness on the debt
securities not previously delivered to the trustee for cancellation, for
the principal, and premium, if any, and interest to the date of the
deposit or to the stated maturity, as the case may be,
then the indenture will cease to be of further effect, and we will be deemed to
have satisfied and discharged the indenture. However, we will continue to be
obligated to pay all other sums due under the indenture and to provide the
officers' certificates and opinions of counsel described in the indenture.
DEFEASANCE
Unless we state otherwise in the applicable prospectus supplement, each
indenture provides that we will be deemed to have paid and discharged the entire
indebtedness on all the debt securities of a series at any time prior to their
stated maturity or redemption when:
- we have irrevocably deposited or caused to be deposited with the trustee,
in trust, either:
- sufficient funds to pay and discharge the entire indebtedness on the
debt securities for the principal, premium, if any, and interest to
the stated maturity or any redemption date, or
- the amount of U.S. government securities as will, in the written
opinion of independent public accountants delivered to the trustee,
together with predetermined and certain income to accrue, without
consideration of any reinvestment, be sufficient to pay and
discharge when due the entire indebtedness on the debt securities
for principal, premium, if any, and interest to the stated maturity
or any redemption date; and
- we have paid or caused to be paid all other sums payable on the debt
securities; and
- we have delivered to the trustee an officer's certificate and an opinion
of counsel to the effect that:
- we have received from, or there has been published by, the Internal
Revenue Service a ruling, or
- since the date of execution of the applicable indenture, there has
been a change in the applicable federal income tax law,
in either case to the effect that the deposit and related defeasance
would not cause you to recognize income, gain or loss for federal income
tax purposes; and
- we have delivered to the trustee an opinion of counsel that neither we
nor the trust held by the trustee will immediately after the deposit just
described be an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act of
1940; and
- we have delivered to the trustee the other officer's certificates and
opinions of counsel as may be required by the indenture, each stating
that all conditions precedent relating to the satisfaction and discharge
of the entire indebtedness on all debt securities have been complied
with.
The subordinated indenture will not be discharged as described above if we
have defaulted in the payment of principal of, premium, if any, or interest on
any senior debt and that default is continuing or another event of default on
the senior debt then exists and has resulted in the senior debt becoming or
being declared due and payable prior to the date it would have become due and
payable.
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CONVERSION OR EXCHANGE
We may convert or exchange the debt securities into common stock or other
securities. If so, we will describe the specific terms on which the debt
securities may be converted or exchanged in the applicable prospectus
supplement. The conversion or exchange may be mandatory, at your option, or at
our option. The applicable prospectus supplement will describe the manner in
which the shares of common stock or other securities you would receive would be
converted or exchanged.
SUBORDINATION UNDER THE SUBORDINATED INDENTURE
In the subordinated indenture, we have agreed that any subordinated debt
securities are subordinate and junior in right of payment to all senior debt to
the extent provided in the subordinated indenture.
Upon any payment or distribution of assets to creditors upon any
liquidation, dissolution, winding up, reorganization, assignment for the benefit
of creditors, marshaling of assets or any bankruptcy, insolvency, debt
restructuring or similar proceedings in connection with our insolvency or
bankruptcy, the holders of senior debt will first be entitled to receive payment
in full of principal of, premium, if any, and interest on the senior debt before
the holders of subordinated debt securities will be entitled to receive or
retain any payment of the principal of, premium, if any, or interest on the
subordinated debt securities.
If the maturity of any subordinated debt securities is accelerated, the
holders of all senior debt outstanding at the time of the acceleration will
first be entitled to receive payment in full of all amounts due, including any
amounts due upon acceleration, before you will be entitled to receive any
payment of the principal of, premium, if any, or interest on the subordinated
debt securities.
We will not make any payments of principal of, premium, if any, or interest
on the subordinated debt securities if:
- a default in any payment on senior debt then exists,
- an event of default on any senior debt resulting in the acceleration of
its maturity then exists, or
- any judicial proceeding is pending in connection with a default.
When we use the term "debt" we mean, with respect to any person, whether
recourse is to all or a portion of the assets of that person and whether or not
contingent:
- every obligation of that person for money borrowed,
- every obligation of that person evidenced by bonds, debentures, notes or
other similar instruments, including obligations incurred in connection
with the acquisition of property, assets or businesses,
- every reimbursement obligation of that person with respect to letters of
credit, bankers' acceptances or similar facilities issued for the account
of that person,
- every obligation of that person issued or assumed as the deferred
purchase price of property or services, but excluding trade accounts
payable or accrued liabilities arising in the ordinary course of
business,
- every capital lease obligation of that person, and
- every obligation of the type referred to in the prior five clauses of
another person and all dividends of another person the payment of which
that person has guaranteed or is responsible or liable for, directly or
indirectly, including as obligor.
When we use the term "senior debt" we mean the principal of, premium, if
any, and interest on debt, whether incurred on, prior to or after the date of
the subordinated indenture, unless the instrument creating or evidencing that
debt or pursuant to which that debt is outstanding states that those obligations
are not superior in right of payment to the subordinated debt securities or to
other debt which ranks equally with, or junior to, the subordinated debt
securities. Interest on this senior debt includes interest accruing on or after
the filing of any petition in bankruptcy or for reorganization relating to The
Hartford
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Financial Services Group, Inc., whether or not the claim for post-petition
interest is allowed in that proceeding.
However, senior debt will not include:
- any debt of The Hartford Financial Services Group, Inc. which when
incurred and without regard to any election under Section 1111(b) of the
Bankruptcy Code, was without recourse to The Hartford Financial Services
Group, Inc.,
- any debt of The Hartford Financial Services Group, Inc. to any of it
subsidiaries,
- debt to any employee of The Hartford Financial Services Group, Inc.,
- any liability for taxes, and
- indebtedness or monetary obligations to trade creditors or assumed by The
Hartford Financial Services Group, Inc. or any of its subsidiaries in the
ordinary course of business in connection with the obtaining of materials
or services.
We are a non-operating holding company, and most of our assets are owned by
our subsidiaries. Accordingly, the debt securities will be effectively
subordinated to all our existing and future liabilities, including liabilities
under contracts of insurance and annuities written by our insurance
subsidiaries. You should rely only on our assets for payments of interest and
principal and premium, if any. The payment of dividends by our insurance company
subsidiaries, including Hartford Fire, is limited under the insurance holding
company laws in the jurisdictions where those subsidiaries are domiciled. See
"The Hartford Financial Services Group, Inc."
The subordinated indenture does not limit the amount of additional senior
debt that we may incur. We expect from time to time to incur additional senior
debt.
The subordinated indenture provides that we may change the subordination
provisions relating to any particular issue of subordinated debt securities
prior to issuance. We will describe any change in the prospectus supplement
relating to the subordinated debt securities.
GOVERNING LAW
The indentures and the debt securities will be governed by and construed in
accordance with the laws of the State of New York.
CONCERNING THE TRUSTEES
Each of the trustees acts as depositary for funds of, makes loans to, and
performs other services for, us and our subsidiaries in the normal course of
business.
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DESCRIPTION OF JUNIOR SUBORDINATED DEBENTURES
We will issue the junior subordinated debentures in one or more series
under a junior subordinated indenture, as supplemented from time to time,
between us and Wilmington Trust Company, as debenture trustee.
The following description of the terms of the junior subordinated
debentures is a summary. It summarizes only those terms of the junior
subordinated debentures which we believe will be most important to your decision
to invest in our junior subordinated debentures. You should keep in mind,
however, that it is the junior subordinated indenture, and not this summary,
which defines your rights as a holder of our junior subordinated debentures.
There may be other provisions in the junior subordinated indenture which are
also important to you. You should read the junior subordinated indenture for a
full description of the terms of the junior subordinated debentures. The form of
the junior subordinated indenture is filed as an exhibit to the Registration
Agreement that includes this prospectus. See "Where You Can Find More
Information" for information on how to obtain a copy of the junior subordinated
indenture.
RANKING OF THE JUNIOR SUBORDINATED DEBENTURES
Each series of junior subordinated debentures will rank equally with all
other series of junior subordinated debentures, and will be unsecured and
subordinate and junior in right of payment, as described in the junior
subordinated indenture, to all of our senior debt. See "-- Subordination."
As a non-operating holding company, most of our operating assets and the
assets of our consolidated subsidiaries are owned by our subsidiaries. We rely
primarily on dividends from our subsidiaries to meet our obligations for payment
of principal and interest on our outstanding debt obligations and corporate
expenses. Accordingly, the junior subordinated debentures will be effectively
subordinated to all existing and future liabilities of our subsidiaries. You
should rely only on our assets for payments on the junior subordinated
debentures. The payment of dividends by our insurance company subsidiaries,
including Hartford Fire, is limited under the insurance holding company laws in
which those subsidiaries are domiciled. See "The Hartford Financial Services
Group, Inc."
Unless we state otherwise in the applicable prospectus supplement, the
junior subordinated indenture does not limit us from incurring or issuing other
secured or unsecured debt under the junior subordinated indenture or any other
indenture that we may have entered into or enter into in the future. See
"-- Subordination" and the prospectus supplement relating to any offering of
securities.
TERMS OF THE JUNIOR SUBORDINATED DEBENTURES
We may issue the junior subordinated debentures in one or more series
through an indenture that supplements the junior subordinated indenture or
through a resolution of our board of directors or an authorized committee of our
board of directors.
You should refer to the applicable prospectus supplement for the specific
terms of the junior subordinated debentures. These may include:
- the title and any limit upon the aggregate principal amount,
- the date(s) on which the principal is payable or the method of
determining those date(s),
- the interest rate(s) or the method of determining these interest rate(s),
- the date(s) on which interest will be payable or the method of
determining these date(s),
- the circumstances in which interest may be deferred, if any,
- the regular record date or the method of determining this date,
- the place or places where we may pay principal, premium, if any, and
interest,
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- conversion or exchange provisions, if any,
- the redemption or early payment provisions,
- the authorized denominations,
- the currency, currencies or currency units in which we may pay the
purchase price for, the principal of, premium, if any, and interest on
the junior subordinated debentures,
- additions to or changes in the events of default or any changes in any of
our covenants specified in the junior subordinated indenture,
- any index or indices used to determine the amount of payments of
principal and premium, if any, or the method of determining these
amounts,
- whether a temporary global security will be issued and the terms upon
which you may exchange a temporary global security for definitive junior
subordinated debt securities,
- whether we will issue the junior subordinated debt securities in whole or
in part in the form of one or more global securities,
- the terms and conditions of any obligation or right we would have to
convert or exchange the junior subordinated debentures into preferred
securities or other securities, and
- additional terms not inconsistent with the provisions of the junior
subordinated indenture.
SPECIAL PAYMENT TERMS OF THE JUNIOR SUBORDINATED DEBENTURES
We may issue junior subordinated debentures at a substantial discount below
their stated principal amount, bearing no interest or interest at a rate which
at the time of issuance is below market rates. We will describe United States
Federal income tax consequences and special considerations relating to any
junior subordinated debentures in the applicable prospectus supplement.
The purchase price of any of the junior subordinated debentures may be
payable in one or more foreign currencies or currency units. The junior
subordinated debentures may be denominated in one or more foreign currencies or
currency units, or the principal of, premium, if any, or interest on any junior
subordinated debentures may be payable in one or more foreign currencies or
currency units. We will describe the restrictions, elections, federal income tax
considerations, specific terms and other information relating to the junior
subordinated debentures and the foreign currency units in the applicable
prospectus supplement.
If we use any index to determine the amount of payments of principal of,
premium, if any, or interest on any series of junior subordinated debentures, we
will also describe special federal income tax, accounting and other
considerations relating to the junior subordinated debentures in the applicable
prospectus supplement.
DENOMINATIONS, REGISTRATION AND TRANSFER
Unless we state otherwise in the applicable prospectus supplement, we will
issue the junior subordinated debentures only in registered form without coupons
in denominations of $25 and any integral multiple of $25. Junior subordinated
debentures of any series will be exchangeable for other junior subordinated
debentures of the same issue and series, of any authorized denominations, of a
like aggregate principal amount, of the same original issue date and stated
maturity and bearing the same interest rate.
You may present junior subordinated debentures for exchange as described
above, or for registration of transfer, at the office of the securities
registrar or at the office of any transfer agent we designate for that purpose.
You will not incur a service charge but you must pay any taxes and other
governmental charges as described in the indenture. We will appoint the trustees
as securities registrars under the indentures. We may at any time rescind the
designation of any transfer agent that we initially designate or approve a
change in the location through which the transfer agent acts. We must maintain a
transfer agent
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in each place of payment. We will specify the transfer agent in the applicable
prospectus supplement. We may at any time designate additional transfer agents.
If we redeem any junior subordinated debentures, neither we nor the
debenture trustee will be required to:
- issue, register the transfer of, or exchange junior subordinated
debentures during a period beginning at the opening of business 15 days
before the day of selection for redemption of the junior subordinated
debentures and ending at the close of business on the day of mailing of
the relevant notice of redemption, or
- transfer or exchange any junior subordinated debentures selected for
redemption, except for any portion not redeemed of any junior
subordinated debenture that is being redeemed in part.
GLOBAL JUNIOR SUBORDINATED DEBENTURES
We may issue a series of junior subordinated debentures in the form of one
or more global junior subordinated debentures. We will identify the depositary
holding the global junior subordinated debentures in the applicable prospectus
supplement. We will issue global junior subordinated debentures only in fully
registered form and in either temporary or permanent form. Unless it is
exchanged for an individual junior subordinated debenture, a global junior
subordinated debenture may not be transferred except:
- by the depositary to its nominee,
- by a nominee of the depositary to the depositary or another nominee, or
- by the depositary or any nominee to a successor depositary, or any
nominee of the successor.
We will describe the specific terms of the depositary arrangement in the
applicable prospectus supplement. We expect that the following provisions will
generally apply to these depositary arrangements.
Beneficial Interests in a Global Junior Subordinated Debenture
If we issue a global junior subordinated debenture, the depositary for the
global junior subordinated debenture or its nominee will credit on its
book-entry registration and transfer system the principal amounts of the
individual junior subordinated debentures represented by the global junior
subordinated debenture to the accounts of persons that have accounts with it. We
refer to those persons as "participants" in this prospectus. The accounts will
be designated by the dealers, underwriters or agents for the junior subordinated
debentures, or by us if the junior subordinated debentures are offered and sold
directly by us. Ownership of beneficial interests in a global junior
subordinated debenture will be limited to participants or persons that may hold
interests through participants. Ownership and transfers of beneficial interests
in the global junior subordinated debenture will be shown on, and effected only
through, records maintained by the applicable depositary or its nominee, for
interests of participants, and the records of participants, for interests of
persons who hold through participants. The laws of some states require that you
take physical delivery of securities in definitive form. These limits and laws
may impair your ability to transfer beneficial interests in a global junior
subordinated debenture.
So long as the depositary or its nominee is the registered owner of the
global junior subordinated debenture, the depositary or the nominee will be
considered the sole owner or holder of the junior subordinated debentures
represented by the global junior subordinated debenture for all purposes under
the junior subordinated indenture. Except as provided below, you:
- will not be entitled to have any of the individual junior subordinated
debentures represented by the global junior subordinated debenture
registered in your name,
- will not receive or be entitled to receive physical delivery of any
junior subordinated debentures in definitive form, and
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- will not be considered the owner or holder of the junior subordinated
debenture under the junior subordinated indenture.
Payments of Principal, Premium and Interest
We will make principal, premium and interest payments on global junior
subordinated debentures to the depositary that is the registered holder of the
global junior subordinated debenture or its nominee. The depositary for the
junior subordinated debentures will be solely responsible and liable for all
payments made on account of your beneficial ownership interests in the global
junior subordinated debenture and for maintaining, supervising and reviewing any
records relating to your beneficial ownership interests.
We expect that the depositary or its nominee, upon receipt of principal,
premium or interest payments, immediately will credit participants' accounts
with amounts in proportion to their respective beneficial interests in the
principal amount of the global junior subordinated debenture as shown on the
records of the depositary or its nominee. We also expect that payments by
participants to you, as an owner of a beneficial interest in the global junior
subordinated debenture held through those participants, will be governed by
standing instructions and customary practices, as is now the case with
securities held for the accounts of customers in bearer form or registered in
"street name." These payments will be the responsibility of those participants.
Issuance of Individual Junior Subordinated Debentures
Unless we state otherwise in the applicable prospectus supplement, if a
depositary for a series of junior subordinated debentures is at any time
unwilling, unable or ineligible to continue as depositary and we do not appoint
a successor depositary within 90 days, we will issue individual junior
subordinated debentures in exchange for the global junior subordinated
debenture. In addition, we may at any time and in our sole discretion, subject
to any limitations described in the prospectus supplement relating to the junior
subordinated debentures, determine not to have any junior subordinated
debentures represented by one or more global junior subordinated debentures. If
that occurs, we will issue individual junior subordinated debentures in exchange
for the global junior subordinated debenture.
Further, we may specify that you may, on terms acceptable to us, the
debenture trustee and the depositary for the global junior subordinated
debenture, receive individual junior subordinated debentures in exchange for
your beneficial interest in a global junior subordinated debenture, subject to
any limitations described in the prospectus supplement relating to the junior
subordinated debentures. In that instance, you will be entitled to physical
delivery of individual junior subordinated debentures equal in principal amount
to that beneficial interest and to have the junior subordinated debentures
registered in your name. Unless we otherwise specify, those individual junior
subordinated debentures will be issued in denominations of $25 and integral
multiples of $25.
PAYMENT AND PAYING AGENTS
Unless we state otherwise in the applicable prospectus supplement, we will
pay principal of, premium, if any, and interest on your junior subordinated
debentures at the office of the debenture trustee in the City of New York or at
the office of any paying agent that we may designate. In addition, we may pay
interest:
- except in the case of global junior subordinated debentures, by check
mailed to the address of the person entitled to the payment that appears
in the securities register, or
- by transfer to an account maintained by the person entitled to the
payment as specified in the securities register.
Unless we state otherwise in the applicable prospectus supplement, we will
pay any interest on junior subordinated debentures to the registered owner of
the junior subordinated debenture at the close of business on the regular record
date for the interest, except in the case of defaulted interest. We may at any
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time designate additional paying agents or rescind the designation of any paying
agent. We must maintain a paying agent in each place of payment for the junior
subordinated debentures.
Any moneys deposited with the debenture trustee or any paying agent, or
then held by us in trust, for the payment of the principal of, premium, if any,
and interest on any junior subordinated debenture that remain unclaimed for two
years after the principal, premium or interest has become due and payable will,
at our request, be repaid to us. After repayment to us, you are entitled to seek
payment only from us as a general unsecured creditor.
REDEMPTION
Unless we state otherwise in the applicable prospectus supplement, junior
subordinated debentures will not be subject to any sinking fund.
We may, at our option, redeem any series of junior subordinated debentures
on any interest payment date in whole or in part. We may redeem junior
subordinated debentures in denominations larger than $25 but only in integral
multiples of $25.
Redemption Price
Except as we may otherwise specify in the applicable prospectus supplement,
the redemption price for any junior subordinated debenture redeemed will equal
any accrued and unpaid interest to the redemption date, plus the greater of:
- the principal amount, and
- an amount equal to:
- for junior subordinated debentures bearing interest at a fixed rate,
the discounted remaining fixed amount payments, calculated as
described below, or
- for junior subordinated debentures bearing interest determined by
reference to a floating rate, the discounted swap equivalent
payments, calculated as described below, to determine any redemption
premium based upon the value of interest payable on an equivalent
fixed rate junior subordinated debenture.
The discounted remaining fixed amount payments will equal the sum of the
current values of the amounts of interest and principal that would have been
payable by us on each interest payment date after the redemption date and at
stated maturity of the final payment of principal. This calculation will take
into account any required sinking fund payments, but will otherwise assume that
we have not redeemed the junior subordinated debenture prior to the stated
maturity.
The current value of any amount is the present value of that amount on the
redemption date after discounting that amount on a monthly, quarterly or
semiannual basis, whichever corresponds to the interest payment date periods of
the related series of junior subordinated debentures, from the originally
scheduled date for payment. We will use the treasury rate to calculate this
present value.
The treasury rate is a per annum rate, expressed as a decimal and, in the
case of United States Treasury bills, converted to a per annum yield, determined
on the redemption date to be the per annum rate equal to the semiannual bond
equivalent yield to maturity, adjusted to reflect monthly or quarterly
compounding in the case of junior subordinated debentures having monthly or
quarterly interest payment dates for United States Treasury securities maturing
at the stated maturity of the final payment of principal of the junior
subordinated debentures redeemed. We will determine this rate by reference to
the weekly average yield to maturity for United States Treasury securities
maturing on that stated maturity if reported in the most recent Statistical
Release H.15(519) of the Board of Governors of the Federal Reserve. If no such
securities mature at the stated maturity, we will determine the rate by
interpolation between the most recent weekly average yields to maturity for two
series of United States Treasury securities, (1) one maturing as close as
possible to, but earlier than, the stated maturity and (2) the other
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maturing as close as possible to, but later than, the stated maturity, in each
case as published in the most recent Statistical Release H.15(519) of the Board
of Governors of the Federal Reserve.
The discounted swap equivalent payments will equal the sum of:
- the current value of the amount of principal that would have been payable
by us pursuant to the terms of the junior subordinated debenture at the
stated maturity of the final payment of the principal of the junior
subordinated debentures. This calculation will take into account any
required sinking fund payments but will otherwise assume that we had not
redeemed the junior subordinated debenture prior to the stated maturity,
and
- the sum of the current values of the fixed rate payments that leading
interest rate swap dealers would require to be paid by an assumed fixed
rate payer having the same credit standing as ours against floating rate
payments to be made by these leading dealers equal to the interest
payments on the junior subordinated debentures being redeemed, taking
into account any required sinking fund payment, but otherwise assuming we
had not redeemed the junior subordinated debenture prior to the stated
maturity, under a standard interest rate swap agreement having a notional
principal amount equal to the principal amount of the junior subordinated
debentures, a termination date set at the stated maturity of the junior
subordinated debentures and payment dates for both fixed and floating
rate payers set at each interest payment date of the junior subordinated
debentures. The amount of the fixed rate payments will be based on
quotations received by the trustee, or an agent appointed for that
purpose, from four leading interest rate swap dealers or, if quotations
from four leading interest rate swap dealers are not obtainable, three
leading interest rate swap dealers.
Debenture Tax Event Redemption
Unless we state otherwise in the applicable prospectus supplement, if a
debenture tax event relating to a series of junior subordinated debentures then
exists, we may, at our option, redeem the series of junior subordinated
debentures in whole, but not in part, on any interest payment date within 90
days of the debenture tax event occurring. The redemption price will equal the
principal amount of the junior subordinated debentures then outstanding plus
accrued and unpaid interest to the date fixed for redemption.
A "debenture tax event" occurs when we receive an opinion of counsel
experienced in these matters to the effect that, as a result of any amendment
to, or change, including any announced prospective change in, the laws or
regulations of the United States or any political subdivision or taxing
authority affecting taxation, or as a result of any official administrative
pronouncement or judicial decision interpreting or applying those laws or
regulations, which amendment or change is effective or pronouncement or decision
is announced on or after the date we issue the applicable series of junior
subordinated debentures, there is more than an insubstantial risk that interest
payable by us on the series of junior subordinated debentures is not, or within
90 days of that date, will not be, deductible, in whole or in part, for United
States federal income tax purposes.
Notice of Redemption
We will mail notice of any redemption of your junior subordinated
debentures at least 30 days but not more than 60 days before the redemption date
to you at your registered address. Unless we default in payment of the
redemption price, on and after the redemption date interest will cease to accrue
on the junior subordinated debentures or the portions called for redemption.
OPTION TO EXTEND INTEREST PAYMENT DATE
If provided in the applicable prospectus supplement, we will have the right
during the term of any series of junior subordinated debentures to extend the
interest payment period for a specified number of interest payment periods,
subject to the terms, conditions and covenants specified in the prospectus
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supplement. However, we may not extend these interest payments beyond the
maturity of the junior subordinated debentures. We will describe the federal
income tax consequences and special considerations relating to any junior
subordinated debentures in the applicable prospectus supplement.
If we exercise this right, during the extension period we and our
subsidiaries may not:
- declare or pay any dividends or distributions on, or redeem, purchase,
acquire or make a liquidation payment on, any of our capital stock, or
- make any payment of principal, premium, if any, or interest on or repay,
repurchase or redeem any debt securities that rank equally with or junior
in interest to the junior subordinated debentures or make any related
guarantee payments,
other than:
- dividends or distributions on our common stock,
- redemptions or purchases of any rights pursuant to our rights plan, or
any successor to our rights plan, and the declaration of a dividend of
these rights in the future, and
- payments under any guarantee.
MODIFICATION OF INDENTURE
We and the debenture trustee may, without the consent of the holders of
junior subordinated debentures, amend, waive or supplement the junior
subordinated indenture for specified purposes, including, among other things,
curing ambiguities, defects or inconsistencies. However, no action may
materially adversely affect the interests of holders of any series of junior
subordinated debentures or, in the case of corresponding junior subordinated
debentures, the holders of the corresponding series of preferred securities so
long as they remain outstanding. We may also amend the junior subordinated
indenture to maintain the qualification of the indenture under the Trust
Indenture Act.
We and the debenture trustee may, with the consent of the holders of not
less than a majority in principal amount of the series of junior subordinated
debentures affected, modify the junior subordinated indenture in a manner
affecting the rights of the holders of junior subordinated debentures. However,
no modification may, without the consent of the holder of each outstanding
junior subordinated debenture affected:
- change the stated maturity of the junior subordinated debentures,
- reduce the principal amount of the junior subordinated debentures,
- reduce the rate or extend the time of payment of interest on the junior
subordinated debentures, or
- reduce the percentage of principal amount of the junior subordinated
debentures, the holders of which are required to consent to the
modification of the junior subordinated indenture.
In the case of corresponding junior subordinated debentures, so long as any
of the corresponding series of preferred securities remain outstanding:
- no such modification may be made that adversely affects the holders of
the preferred securities,
- no termination of the junior subordinated indenture may occur, and
- no waiver of any debenture event of default or compliance with any
covenant under the junior subordinated indenture may be effective,
without the prior consent of the holders of at least a majority of the aggregate
liquidation preference of the preferred securities unless the principal of the
corresponding junior subordinated debentures and all accrued and unpaid interest
on the corresponding junior subordinated debentures have been paid in full and
other conditions are satisfied.
In addition, we and the debenture trustee may execute, without your
consent, any supplemental indenture for the purpose of creating any new series
of junior subordinated debentures.
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DEBENTURE EVENTS OF DEFAULT
Under the terms of the junior subordinated indenture, each of the following
constitutes a debenture event of default for a series of junior subordinated
debentures:
- failure for 30 days to pay any interest on the series of junior
subordinated debentures when due, subject to the deferral of any due date
in the case of an extension period,
- failure to pay any principal or premium, if any, on the series of junior
subordinated debentures when due, including at maturity, upon redemption
or by declaration,
- failure to observe or perform in any material respect specified other
covenants contained in the indenture for 90 days after written notice
from the debenture trustee or the holders of at least 25% in principal
amount of the relevant series of outstanding junior subordinated
debentures, or
- our bankruptcy, insolvency or reorganization.
Effect of Event of Default
The holders of a majority in outstanding principal amount of the series of
junior subordinated debentures have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the debenture
trustee. The debenture trustee or the holders of not less than 25% in aggregate
outstanding principal amount of the series of junior subordinated debentures may
declare the principal due and payable immediately upon a debenture event of
default. In the case of corresponding junior subordinated debentures, if the
debenture trustee or the holders of the corresponding junior subordinated
debentures fail to make this declaration, the holders of at least 25% in
aggregate liquidation preference of the corresponding series of preferred
securities will have that right.
Waiver of Event of Default
The holders of a majority in aggregate outstanding principal amount of the
series of junior subordinated debentures may annul the declaration and waive the
default if:
- the default is other than our non-payment of the principal of the junior
subordinated debentures which has become due solely by such acceleration,
- the default has been cured, and
- we have deposited with the debenture trustee a sum sufficient to pay all
matured installments of interest and principal due other than by
acceleration.
The holders of a majority in outstanding principal amount of the junior
subordinated debentures affected by the default may, on behalf of the holders of
all the junior subordinated debentures, waive any past default, except:
- a default in the payment of principal or interest, unless the default has
been cured and we have deposited with the debenture trustee a sum
sufficient to pay all matured installments of interest and principal due
other than by acceleration, or
- a default relating to a covenant or provision which under the junior
subordinated indenture cannot be modified or amended without the consent
of the holder of each outstanding junior subordinated debenture.
We are required under the junior subordinated indenture to file annually
with the junior subordinated indenture trustee a certificate of compliance.
If a debenture event of default then exists as to a series of corresponding
junior subordinated debentures, the property trustee will have the right to
declare the principal of and the interest on the corresponding junior
subordinated debentures, and any other amounts payable under the indenture, to
be
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due and payable and to enforce its other rights as a creditor in connection with
the corresponding junior subordinated debentures.
Direct Actions by Preferred Securityholders
If a debenture event of default is attributable to our failure to pay
interest or principal on the corresponding junior subordinated debentures on the
date the interest or principal is payable, you, as a holder of preferred
securities, may institute a legal proceeding directly against us, which we refer
to in this prospectus as a "direct action," for enforcement of payment to you of
the principal of or interest on the corresponding junior subordinated debentures
having a principal amount equal to the aggregate liquidation amount of your
related preferred securities.
We may not amend the junior subordinated indenture to remove the right to
bring a direct action without the prior written consent of the holders of all of
the preferred securities. If the right to bring a direct action is removed, the
applicable issue may become subject to the reporting obligations under the
Securities Exchange Act of 1934. We have the right under the junior subordinated
indenture to set-off any payment made to you as a holder of preferred securities
by us in connection with a direct action. You will not be able to exercise
directly any other remedy available to holders of the corresponding junior
subordinated debentures.
You will not be able to exercise directly any remedies other than those
described in the preceding paragraph available to holders of the junior
subordinated debentures unless there has been an event of default under the
trust agreement.
CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS
We will not consolidate with or merge into any other corporation or convey,
transfer or lease our properties and assets substantially as an entirety to any
person, and no person will consolidate with or merge into us or convey, transfer
or lease its properties and assets substantially as an entirety to us, unless:
- if we consolidate with or merge into another corporation or convey or
transfer our properties and assets substantially as an entirety to any
person, the successor corporation is organized under the laws of the
United States or any state or the District of Columbia, and the successor
corporation expressly assumes our obligations relating to the junior
subordinated debentures,
- immediately after giving effect to the consolidation, merger, conveyance
or transfer, there exists no debenture event of default, and no event
which, after notice or lapse of time or both, would become a debenture
event of default,
- in the case of corresponding junior subordinated debentures, the
transaction is permitted under the related trust agreement or guarantee
and does not give rise to any breach or violation of the related trust
agreement or guarantee, and
- other conditions described in the junior subordinated indenture are met.
The general provisions of the junior subordinated indenture do not protect
you against transactions, such as a highly leveraged transaction, that may
adversely affect you.
SATISFACTION AND DISCHARGE
The junior subordinated indenture provides that when, among other things,
all junior subordinated debentures not previously delivered to the debenture
trustee for cancellation:
- have become due and payable, or
- will become due and payable at their stated maturity within one year, and
we deposit or cause to be deposited with the debenture trustee, in trust,
an amount in the currency or currencies in which the junior subordinated
debentures are payable sufficient to pay and discharge the entire
indebtedness on the junior subordinated debentures not previously
delivered to the debenture trustee for
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cancellation, for the principal, premium, if any, and interest on the
date of the deposit or to the stated maturity, as the case may be,
then the junior subordinated indenture will cease to be of further effect and we
will be deemed to have satisfied and discharged the indenture. However, we will
continue to be obligated to pay all other sums due under the junior subordinated
indenture and to provide the officers' certificates and opinions of counsel
described in the junior subordinated indenture.
CONVERSION OR EXCHANGE
We may convert or exchange the junior subordinated debentures into
preferred securities or other securities. If so, we will describe the specific
terms on which junior subordinated debentures may be converted or exchanged in
the applicable prospectus supplement. The conversion or exchange may be
mandatory, at your option or at our option. The applicable prospectus supplement
will state the manner in which the preferred securities you would receive would
be converted or exchanged.
SUBORDINATION
In the junior subordinated indenture, we have agreed that any junior
subordinated debentures will be subordinate and junior in right of payment to
all senior debt to the extent provided in the junior subordinated indenture.
Upon any payment or distribution of assets to creditors upon any
liquidation, dissolution, winding up, reorganization, assignment for the benefit
of creditors, marshaling of assets or any bankruptcy, insolvency, debt
restructuring or similar proceedings in connection with our insolvency or
bankruptcy, the holders of senior debt will first be entitled to receive payment
in full of principal of, premium, if any, and interest on the senior debt before
the holders of junior subordinated debentures or, in the case of corresponding
junior subordinated debentures, the property trustee on behalf of the holders,
will be entitled to receive or retain any payment of the principal, premium, if
any, or interest on the junior subordinated debentures.
If the maturity of any junior subordinated debentures is accelerated, the
holders of all senior debt outstanding at the time of the acceleration will
first be entitled to receive payment in full of all amounts due, including any
amounts due upon acceleration, before you will be entitled to receive any
payment of the principal of, premium, if any, or interest on the junior
subordinated debentures.
We will not make any payments of principal of, premium, if any, or interest
on the junior subordinated debentures if:
- a default in any payment on senior debt then exists,
- an event of default on any senior debt resulting in the acceleration of
its maturity then exists, or
- any judicial proceeding is pending in connection with a default.
When we use the term "debt", we mean, with respect to any person, whether
recourse is to all or a portion of the assets of that person and whether or not
contingent:
- every obligation of that person for money borrowed,
- every obligation of that person evidenced by bonds, debentures, notes or
other similar instruments, including obligations incurred in connection
with the acquisition of property, assets or businesses,
- every reimbursement obligation of that person with respect to letters of
credit, bankers' acceptances or similar facilities issued for the account
of the person,
- every obligation of that person issued or assumed as the deferred
purchase price of property or services, but excluding trade accounts
payable or accrued liabilities arising in the ordinary course of
business,
- every capital lease obligation of that person, and
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- every obligation of the type referred to in the prior five clauses of
another person and all dividends of another person the payment of which
the person has guaranteed or is responsible or liable for, directly or
indirectly, including as obligor.
When we use the term "senior debt" we mean the principal, premium, if any,
and interest on debt, whether incurred on, prior to or after the date of the
junior subordinated indenture, unless the instrument creating or evidencing that
debt or pursuant to which that debt is outstanding states that those obligations
are not superior in right of payment to the junior subordinated debentures or to
other debt which ranks equally with, or junior to, the junior subordinated
debentures. Interest on this senior debt includes interest accruing on or after
the filing of any petition in bankruptcy or for reorganization relating to The
Hartford Financial Services Group, Inc., whether or not the claim for
post-petition interest is allowed in that proceeding.
However, senior debt will not include:
- any debt of The Hartford Financial Services Group, Inc. which when
incurred and without regard to any election under Section 1111(b) of the
Bankruptcy code, was without recourse to The Hartford Financial Services
Group, Inc.,
- any debt of The Hartford Financial Services Group, Inc. to any of its
subsidiaries,
- debt to any employee of The Hartford Financial Services Group, Inc.,
- any liability for taxes,
- indebtedness or monetary obligations to trade creditors or assumed by The
Hartford Financial Services Group, Inc. or any of its subsidiaries in the
ordinary course of business in connection with the obtaining of materials
or services, and
- any other junior subordinated debentures issued pursuant to the junior
subordinated indenture.
We are a non-operating holding company, and most of our assets are owned by
our subsidiaries. Accordingly, the junior subordinated debentures will be
effectively subordinated to all existing and future liabilities of our
subsidiaries, including liabilities under contracts of insurance and annuities
written by our insurance subsidiaries. You should rely only on our assets for
payments of interest and principal and premium, if any. The payment of dividends
by our insurance company subsidiaries, including Hartford Fire, is limited under
the insurance holding company laws in the jurisdictions where those subsidiaries
are domiciled. See "The Hartford Financial Services Group, Inc."
The junior subordinated indenture does not limit the amount of additional
senior debt that we may incur. We expect from time to time to incur additional
senior debt.
The indenture provides that we may change the subordination provisions
relating to any particular issue of junior subordinated debentures prior to
issuance. We will describe any change in the prospectus supplement relating to
the junior subordinated debentures.
GOVERNING LAW
The junior subordinated indenture and the junior subordinated debentures
will be governed by and construed in accordance with the laws of the State of
New York.
INFORMATION CONCERNING THE DEBENTURE TRUSTEE
The debenture trustee will have all the duties and responsibilities of an
indenture trustee specified in the Trust Indenture Act. Subject to those
provisions, the debenture trustee is not required to exercise any of its powers
under the junior subordinated indenture at your request, unless you offer
reasonable indemnity against the costs, expenses and liabilities which the
trustee might incur. The debenture trustee is not required to expend or risk its
own funds or incur personal financial liability in performing its duties if the
debenture trustee reasonably believes that it is not reasonably assured of
repayment or adequate indemnity.
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DESCRIPTION OF CAPITAL STOCK OF
THE HARTFORD FINANCIAL SERVICES GROUP, INC.
AUTHORIZED AND OUTSTANDING CAPITAL STOCK
Our Restated Certificate of Incorporation provides that our authorized
capital stock is 450,000,000 shares. These shares consist of:
- 50,000,000 shares of preferred stock, par value $.01 per share, of which
300,000 shares were designated as Series A Participating Cumulative
Preferred Stock; and
- 400,000,000 shares of common stock, par value $.01 per share.
As of September 30, 2000, we had 225,165,836 outstanding shares of common
stock. Holders of common stock have received a right entitling them, when the
right becomes exercisable, to purchase shares of Series A Participating
Cumulative Preferred Stock. See "-- Rights Agreement." No shares of preferred
stock are currently outstanding.
No holders of any class of our capital stock are entitled to preemptive
rights.
In general, the classes of authorized capital stock are afforded
preferences in relation to dividends and liquidation rights in the order listed
above. Our board of directors is empowered, without approval of our
stockholders, to cause the preferred stock to be issued in one or more series,
with the numbers of shares of each series and the rights, preferences and
limitations of each series to be determined by it. The specific matters that may
be determined by our board of directors include the dividend rights, voting
rights, redemption rights, liquidation preferences, if any, conversion and
exchange rights, retirement and sinking fund provisions and other rights,
qualifications, limitations and restrictions of any wholly unissued series of
preferred stock, or of the entire class of preferred stock if none of the shares
have been issued, the number of shares constituting that series and the terms
and conditions of the issue of the shares.
The following description of our capital stock is a summary. It summarizes
only those aspects of our capital stock which we believe will be most important
to your decision to invest in our capital stock. You should keep in mind,
however, that it is our Restated Certificate of Incorporation and our By-laws,
and not this summary, which defines your rights as a securityholder. There may
be other provisions in these documents which are also important to you. You
should read these documents for a full description of the terms of our capital
stock. Our Restated Certificate of Incorporation and our By-Laws are
incorporated by reference as exhibits to the Registration Statement that
includes this prospectus. See "Where You Can Find More Information" for
information on how to obtain copies of these documents.
COMMON STOCK
Subject to any preferential rights of any preferred stock created by our
board of directors, as a holder of our common stock you are entitled to
dividends as our board of directors may declare from time to time out of funds
that we can legally use to pay dividends. The holders of common stock possess
exclusive voting rights, except to the extent our board of directors specifies
voting power for any preferred stock that is issued.
As a holder of our common stock, you are entitled to one vote for each
share of common stock and do not have any right to cumulate votes in the
election of directors. In the event of our liquidation, dissolution or
winding-up, you will be entitled to receive on a proportionate basis any assets
remaining after provision for payment of creditors and after payment of any
liquidation preferences to holders of preferred stock. Our common stock is
listed on the New York Stock Exchange under the symbol "HIG".
The transfer agent and registrar for our common stock is The Bank of New
York.
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PREFERRED STOCK
We will describe the particular terms of any series of preferred stock in
the prospectus supplement relating to the offering.
We will fix or designate the rights, preferences, privileges and
restrictions, including dividend rights, voting rights, terms of redemption,
retirement and sinking fund provisions and liquidation preferences, if any, of a
series of preferred stock through a certificate of designation adopted by our
board of directors or a duly authorized committee of our board of directors. We
will describe the terms, if any, on which shares of any series of preferred
stock are convertible or exchangeable into common stock in the prospectus
supplement relating to the offering. The conversion or exchange may be
mandatory, at your option or at our option. The applicable prospectus supplement
will state the manner in which the shares of common stock that you will receive
as a holder of preferred stock would be converted or exchanged.
On October 10, 1995, our board of directors declared a dividend of rights
to holders of record of our common stock outstanding as of the close of business
on December 19, 1995. When those rights become exercisable, holders of the
rights will be entitled to purchase shares of Series A Participating Cumulative
Preferred Stock. See "-- Rights Agreement."
DEPOSITARY SHARES
General Terms
We may elect to offer depositary shares representing receipts for
fractional interests in preferred stock, rather than full shares of preferred
stock. In this case, we will issue receipts for depositary shares, each of which
will represent a fraction of a share of a particular series of preferred stock.
We will deposit the shares of any series of preferred stock represented by
depositary shares under a deposit agreement between us and a depositary which we
will name in a prospectus supplement. Subject to the terms of the deposit
agreement, as an owner of a depositary share you will be entitled, in proportion
to the applicable fraction of a share of preferred stock represented by the
depositary share, to all the rights and preferences of the preferred stock
represented by the depositary share, including dividend, voting, redemption,
subscription and liquidation rights.
The following description of the terms of the deposit agreement is a
summary. It summarizes only those terms of the deposit agreement which we
believe will be most important to your decision to invest in our depositary
shares. You should keep in mind, however, that it is the deposit agreement, and
not this summary, which defines your rights as a holder of depositary shares.
There may be other provisions in the deposit agreement which are also important
to you. You should read the deposit agreement for a full description of the
terms of the depositary shares. The form of the deposit agreement is filed as an
exhibit to the Registration Statement that includes this prospectus. See "Where
You Can Find More Information" for information on how to obtain a copy of the
deposit agreement.
Dividends and Other Distributions
The depositary will distribute all cash dividends or other cash
distributions received on the preferred stock to you in proportion to the number
of depositary shares that you own.
In the event of a distribution other than in cash, the depositary will
distribute property received by it to you in an equitable manner, unless the
depositary determines that it is not feasible to make a distribution. In that
case the depositary may sell the property and distribute the net proceeds from
the sale to you.
Redemption of Depositary Shares
If we redeem a series of preferred stock represented by depositary shares,
the depositary will redeem your depositary shares from the proceeds received by
the depositary resulting from the redemption. The redemption price per
depositary share will be equal to the applicable fraction of the redemption
price per
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share payable in relation to the series of preferred stock. Whenever we redeem
shares of preferred stock held by the depositary, the depositary will redeem as
of the same redemption date the number of depositary shares representing the
shares of preferred stock redeemed. If fewer than all the depositary shares are
to be redeemed, the depositary shares to be redeemed will be selected by lot,
proportionately or by any other equitable method as the depositary may
determine.
Voting the Preferred Stock
Upon receipt of notice of any meeting at which you are entitled to vote,
the depositary will mail to you the information contained in that notice of
meeting. Each record holder of the depositary shares on the record date will be
entitled to instruct the depositary how to vote the amount of the preferred
stock represented by that holder's depositary shares. The record date for the
depositary shares will be the same date as the record date for the preferred
stock. The depositary will endeavor, to the extent practicable, to vote the
amount of the preferred stock represented by the depositary shares in accordance
with those instructions. We will agree to take all reasonable action which the
depositary may deem necessary to enable the depositary to do so. The depositary
will abstain from voting shares of the preferred stock if it does not receive
specific instructions from you.
Amendment and Termination of the Deposit Agreement
We and the depositary may amend the form of depositary receipt evidencing
the depositary shares and any provision of the deposit agreement at any time.
However, any amendment which materially and adversely alters the rights of the
holders of the depositary shares will not be effective unless the amendment has
been approved by the holders of at least a majority of the depositary shares
then outstanding.
The deposit agreement will terminate if:
- all outstanding depositary shares have been redeemed, or
- there has been a final distribution in respect of the preferred stock,
including in connection with our liquidation, dissolution or winding up
and the distribution has been distributed to you.
Resignation and Removal of Depositary
The depositary may resign at any time by delivering to us notice of its
election to do so. We also may, at any time, remove the depositary. Any
resignation or removal will take effect upon the appointment of a successor
depositary and its acceptance of such appointment. We must appoint the successor
depositary within 60 days after delivery of the notice of resignation or
removal. The successor depositary must be a bank or trust company having its
principal office in the United States and having a combined capital and surplus
of at least $50,000,000.
Charges of Depositary
We will pay all transfer and other taxes and governmental charges arising
solely from the existence of the depositary arrangements. We will pay charges of
the depositary in connection with the initial deposit of the preferred stock and
issuance of depositary receipts, all withdrawals of shares of preferred stock by
you and any redemption of the preferred stock. You will pay other transfer and
other taxes and governmental charges, as well as the other charges that are
expressly provided in the deposit agreement to be for your account.
Miscellaneous
The depositary will forward all reports and communications from us which
are delivered to the depositary and which we are required or otherwise determine
to furnish to holders of preferred stock.
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Neither we nor the depositary will be liable under the deposit agreement to
you other than for the depositary's gross negligence, willful misconduct or bad
faith. Neither we nor the depositary will be obligated to prosecute or defend
any legal proceedings relating to any depositary shares or preferred stock
unless satisfactory indemnity is furnished. We and the depositary may rely upon
written advice of counsel or accountants, or upon information provided by
persons presenting preferred stock for deposit, you or other persons believed to
be competent and on documents we and the depositary believe to be genuine.
PROVISIONS OF OUR RESTATED CERTIFICATE OF INCORPORATION AND BY-LAWS THAT MAY
DELAY OR MAKE MORE DIFFICULT UNSOLICITED ACQUISITIONS OR CHANGES OF OUR CONTROL
Some provisions of our Restated Certificate of Incorporation and By-laws
may delay or make more difficult unsolicited acquisitions or changes of our
control. We believe that these provisions will enable us to develop our business
in a manner that will foster long-term growth without disruption caused by the
threat of a takeover not thought by our board of directors to be in our best
interests and the best interests of our shareholders.
Those provisions could have the effect of discouraging third parties from
making proposals involving an unsolicited acquisition or change of control of
our company, although the proposals, if made, might be considered desirable by a
majority of our shareholders. Those provisions may also have the effect of
making it more difficult for third parties to cause the replacement of our
current management without the concurrence of our board of directors.
These provisions include:
- the availability of capital stock for issuance from time to time at the
discretion of our board of directors (see "-- Authorized and Outstanding
Capital Stock" and "-- Preferred Stock"),
- prohibitions against shareholders calling a special meeting of
shareholders or acting by written consent instead of a meeting,
- requirements for advance notice for raising business or making
nominations at shareholders' meetings, and
- the ability of our board of directors to increase the size of the board
and to appoint directors to fill newly created directorships.
No Shareholder Action by Written Consent; Special Meetings
Our Restated Certificate of Incorporation and By-laws provide that
shareholder action can be taken only at an annual or special meeting and cannot
be taken by written consent instead of a meeting. Our Restated Certificate of
Incorporation and By-laws also provide that special meetings of shareholders can
be called only by the chairman of our board of directors or by a vote of the
majority of the entire board of directors. Furthermore, our By-laws provide that
only such business as is specified in the notice of any special meeting of
shareholders may come before the meeting.
Advance Notice for Raising Business or Making Nominations at Meetings
Our By-laws establish an advance notice procedure for shareholder proposals
to be brought before an annual meeting of shareholders and for nominations by
shareholders of candidates for election as directors at an annual or special
meeting at which directors are to be elected. The only business that may be
conducted at an annual meeting of shareholders is business that has been brought
before the meeting by, or at the direction of, the board of directors, or by a
shareholder who has given to the secretary of the company timely written notice,
in proper form, of the shareholder's intention to bring that business before the
meeting. The chairman of the meeting will have the authority to make these
determinations. Only persons who are nominated by, or at the direction of, the
board of directors, or who are nominated by a shareholder who has given timely
written notice, in proper form, to the secretary prior to a meeting at which
directors are to be elected will be eligible for election as directors.
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To be timely, notice of business to be brought before an annual meeting or
nominations of candidates for election as directors at an annual meeting must be
received by the company's secretary not later than 90 days prior to the
anniversary date for the immediately preceding annual meeting, or not more than
10 days after the first public disclosure of the originally scheduled date of
the annual meeting, whichever is earlier.
Similarly, notice of nominations to be brought before a special meeting of
shareholders for the election of directors must be delivered to the secretary no
later than the close of business on the seventh day following the day on which
notice of the date of the special meeting of shareholders is given.
The notice of any nomination for election as a director is required to
state:
- the name and address of the shareholder who intends to make the
nomination and of the person or persons to be nominated,
- a representation that the shareholder is a holder of record of stock
entitled to vote at such meeting and intends to appear in person or by
proxy at the meeting to nominate the person or persons specified in the
notice,
- a description of all arrangements or understandings relating to the
nomination between the shareholder and each nominee and any other person
or persons, naming those persons, all other information regarding each
nominee proposed by the shareholder that would have been required to be
included in a proxy statement filed under the proxy rules of the
Securities and Exchange Commission had each nominee been nominated, or
intended to be nominated, by our board of directors, and
- the consent of each nominee to serve as a director if so elected.
Number of Directors; Filling of Vacancies
Our Restated Certificate of Incorporation and By-laws provide that newly
created directorships resulting from any increase in the authorized number of
directors, or any vacancy, may be filled by a vote of a majority of directors
then in office, subject to the requirement in the By-laws that the majority of
directors holding office immediately after the election must be "independent
directors," as defined in the By-laws. Accordingly, our board of directors may
be able to prevent any shareholder from obtaining majority representation on the
board of directors by increasing the size of the board and filling the newly
created directorships with its own nominees.
RIGHTS AGREEMENT
The Hartford Financial Services Group, Inc. Rights
On October 10, 1995, our board of directors declared a dividend of one
right for each share of common stock outstanding as of the close of business on
December 19, 1995, with respect to common stock issued after that date until the
distribution date, and, in certain circumstances, with respect to common stock
issued after the distribution date.
On May 21, 1998, our board of directors declared a two-for-one stock split
effected in the form of a 100% stock dividend distributed on July 15, 1998 to
stockholders of record as of June 24, 1998. Before our board of directors
declared the two-for-one stock split, the rights entitled the registered holder
to purchase from us, when it became exercisable, one one-thousandth (1/1000th)
of a share of Series A Participating Cumulative Preferred Stock, at a price of
$2.20 for each right, subject to adjustment in specific circumstances. As a
result of the stock split, the terms of the rights were adjusted so that the
holder of a right may purchase from us, when it becomes exercisable, one-five
hundredth (1/500th) of a share of Series A Participating Cumulative Preferred
Stock, at a price of $1.10 for each right, subject to adjustment in specific
circumstances.
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Each right is subject to redemption at a price of $.005 per share. The
terms of the rights are described in the rights agreement, dated as of November
1, 1995, between us and The Bank of New York, as rights agent. The rights will
not be exercisable until the distribution date and will expire on November 1,
2005, unless earlier redeemed by us as described below. Until a right is
exercised, the holder of the right will not as a result of holding that right
have rights as a shareholder of our company including the right to vote or to
receive dividends with respect to the rights or the Series A Participating
Cumulative Preferred Stock relating to the right.
The following description of the terms of the rights is a summary. It
summarizes only those terms of the rights which we believe will be most
important to your decision to invest in our common stock. You should keep in
mind, however, that it is the rights agreement, and not this summary, which
defines your rights as a holder of our rights. There may be other provisions in
the rights agreement which are also important to you. You should read the rights
agreement for a full description of the terms of the rights. The rights
agreement is filed as an exhibit to the Registration Agreement that includes
this prospectus. See "Where You Can Find More Information" for information on
how to obtain a copy of the rights agreement.
Distribution Date
Under the rights agreement, the distribution date is the earlier of:
- the time that we learn that a person or group, including any affiliate or
associate of the person or group, has acquired, or has obtained the right
to acquire, beneficial ownership of more than 15% of the outstanding
shares of our common stock (we refer to that person or group as an
"acquiring person"), unless provisions preventing accidental triggering
of the distribution of the rights apply, and
- the close of business on the date, if any, that may be designated by our
board of directors following the commencement of, or first public
disclosure of an intent to commence, a tender or exchange offer for more
than 15% or more of the outstanding shares of our common stock.
A person or group, or any affiliate or associate of the person or group,
however, that inadvertently acquires more than 15% of the outstanding shares of
our common stock will not be deemed to be an acquiring person provided that
person or group reduces its percentage of beneficial ownership to less than 15%
of the outstanding shares of our common stock by the close of business on the
fifth business day after notice from us that that person's or group's ownership
interest exceeds 15% of the outstanding shares of our common stock. That person
or group will be deemed to be an acquiring person at the end of that five
business day period absent such reduction.
Evidence of Rights
Until the distribution date, the rights will be evidenced by the
certificates for common stock rather than separate right certificates.
Therefore, from the issuance date until the distribution date, you will be able
to transfer the rights only with the common stock and each transfer of common
stock will also transfer the associated rights. As soon as practicable following
the distribution date, we will mail separate certificates evidencing the rights
to holders of record of the common stock as of the close of business on the
distribution date, and to each initial record holder of common stock originally
issued after the distribution date. These separate certificates alone will then
evidence the rights.
Adjustments
The number of Series A Participating Cumulative Preferred Stock or other
securities that we will issue upon exercise of the rights, the purchase price,
the redemption price and the number of rights associated with each share of
common stock are all subject to adjustment from time to time if there is any
change in the common stock or the Series A Participating Cumulative Preferred
Stock. An adjustment may be made as a result of stock dividends, stock splits,
recapitalizations, mergers, consolidations,
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combinations or exchanges of securities, split-ups, split-offs, spin-offs,
liquidations, other similar changes in capitalization or any distribution or
issuance of cash, assets, evidences of indebtedness or subscription rights,
options or warrants to holders of common stock or Series A Participating
Cumulative Preferred Stock.
We may, but we are not required to, issue fractions of rights or distribute
right certificates which evidence fractional rights. Instead of issuing
fractional rights, we may make a cash payment based on the market price of those
rights. In addition, we may, but we are not required to, issue fractions of
shares upon the exercise of the rights or distribute certificates which evidence
fractional Series A Participating Cumulative Preferred Stock. Instead of
fractional Series A Participating Cumulative Preferred Stock, we may utilize a
depositary arrangement as provided by the terms of the Series A Participating
Cumulative Preferred Stock and, for fractions other than one-five hundredth
(1/500th) of a Series A Participating Cumulative Preferred Stock or integral
multiples, may make a cash payment based on the market price of those shares.
Triggering Event and Effect of Triggering Event
Any time there is an acquiring person, the rights will entitle you,
provided you are not the acquiring person, to purchase, for the purchase price
of the rights, that number of one-five hundredth (1/500th) of a Series A
Participating Cumulative Preferred Stock equivalent to the number of shares of
common stock which at the time of that event would have a market value of twice
the purchase price.
If we are acquired in a merger or other business combination by an
acquiring person or an affiliate or associate of an acquiring person that is a
publicly traded corporation, or 50% or more of our assets or assets representing
50% or more of our revenues or cash flow are sold, leased, exchanged or
otherwise transferred in one or more transactions to an acquiring person or an
affiliate or associate of an acquiring person that is not a publicly traded
corporation, each right will entitle you, subject to the next paragraph, to
purchase, for the purchase price of the right, that number of common shares of
that corporation which at the time of the transaction would have a market value
of twice the purchase price. If we are acquired in a merger or other business
combination by an acquiring person or an affiliate or associate of an acquiring
person that is not a publicly traded entity or 50% or more of our assets or
assets representing 50% or more of our revenues or cash flow are sold, leased,
exchanged or otherwise transferred in one or more transactions to an acquiring
person or an affiliate or associate of an acquiring person that is not a
publicly traded entity, each right will entitle you, subject to the next
paragraph, to purchase, for the purchase price of the right, at your option:
- that number of shares of the surviving corporation which at the time of
the transaction would have a book value of twice the purchase price,
- that number of shares of that entity which at the time of the transaction
would have a book value of twice the purchase price, or
- if that entity has an affiliate which has publicly traded common shares,
that number of common shares of that affiliate which at the time of the
transaction would have market value of twice the purchase price.
Any rights that are at any time beneficially owned by an acquiring person,
or any affiliate or associate of an acquiring person, will be null and void and
nontransferable. Any holder of that right, including any purported transferee or
subsequent holder, will be unable to exercise or transfer the right.
Redemption
At any time prior to the earlier of:
- the time a person or group becomes an acquiring person, and
- November 1, 2005,
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our board of directors may redeem the rights in whole, but not in part, at a
price, which we refer to in this prospectus as the "redemption price," in cash
or common stock or other securities deemed by our board of directors to be at
least equivalent in value, to $.005 per right. This amount is subject to
adjustment as provided in the rights agreement. Immediately upon the action of
our board of directors ordering the redemption of the rights, and without any
further action and without any notice, your right to exercise the rights will
terminate and your only right as a holder of rights will be to receive the
redemption price. Within 10 business days after the action of our board of
directors ordering the redemption of the rights, we will give notice of the
redemption to the holders of the then outstanding rights by mail. We will state
the method by which we will pay the redemption price in the notice of
redemption.
In addition, at any time after there is an acquiring person, our board of
directors may elect to exchange each right, other than rights that have become
null and void and nontransferable as described above, for a consideration per
right consisting of one-half of the securities that would be issuable at that
time upon exercise of one right.
Amendment
At any time prior to the distribution date, we may, without your approval,
supplement or amend any provision of the rights agreement, including, without
limitation, the distribution date, the definition of acquiring person, the time
during which the rights may be redeemed or the terms of the Series A
Participating Cumulative Preferred Stock. However, we will not supplement or
amend the rights agreement to reduce the redemption price or provide for an
earlier expiration date. After the distribution date and subject to applicable
law, we may amend the rights agreement without your approval:
- to cure any ambiguity or to correct or supplement any provision contained
in the rights agreement which may be defective or inconsistent with any
other provision of the rights agreement, or
- to make any other provision which we may deem necessary or desirable and
which will not adversely affect the interests of the holders of right
certificates.
Any supplement or amendment adopted during any period after any person or
group has become an acquiring person but prior to the distribution date will be
null and void unless that supplement or amendment could have been adopted under
the prior sentence after the distribution date.
Effect of the Rights Agreement
The rights agreement is designed to protect you in the event of unsolicited
offers to acquire us and other coercive takeover tactics which, in the opinion
of our board of directors, could impair our ability to represent your interests.
The provisions of the rights agreement may render an unsolicited takeover more
difficult or less likely to occur or might prevent such a takeover, even though
that takeover may offer you the opportunity to sell your stock at a price above
the prevailing market rate and may be favored by a majority of our shareholders.
RESTRICTIONS ON OWNERSHIP UNDER INSURANCE LAWS
Although our Restated Certificate of Incorporation and By-laws do not
contain any provision restricting ownership as a result of the application of
various state insurance laws, these laws will be a significant deterrent to any
person interested in acquiring control of our company. The insurance holding
company laws of each of the jurisdictions in which our insurance subsidiaries
are incorporated or commercially domiciled, as well as state corporation laws,
govern any acquisition of control of our insurance subsidiaries or of our
company. In general, these laws provide that no person or entity may directly or
indirectly acquire control of an insurance company unless that person or entity
has received the prior approval of the insurance regulatory authorities. An
acquisition of control would be presumed in the case of any person or entity who
purchases 10% or more of our outstanding common stock, or 5% or more, in the
case of the Florida insurance holding company laws, unless the applicable
insurance regulatory authorities determine otherwise.
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DELAWARE GENERAL CORPORATION LAW
The terms of Section 203 of the Delaware General Corporation Law apply to
us since we are a Delaware corporation. Under Section 203, with some exceptions,
a Delaware corporation may not engage in a broad range of business combinations,
such as mergers, consolidations and sales of assets, with an "interested
stockholder," for a period of three years from the date that person became an
interested stockholder unless:
- the transaction that results in a person becoming an interested
stockholder or the business combination is approved by the board of
directors of the corporation before the person becomes an interested
stockholder,
- upon consummation of the transaction which results in the shareholder
becoming an interested stockholder, the interested stockholder owns 85%
or more of the voting stock of the corporation outstanding at the time
the transaction commenced, excluding shares owned by persons who are
directors and also officers and shares owned by employee stock plans, or
- on or after the date the person becomes an interested stockholder, the
business combination is approved by the corporation's board of directors
and by holders of at least two-thirds of the corporation's outstanding
voting stock, excluding shares owned by the interested stockholder, at a
meeting of shareholders.
Under Section 203, an "interested stockholder" is defined as any person,
other than the corporation and any direct or indirect majority-owned subsidiary,
that is:
- the owner of 15% or more of the outstanding voting stock of the
corporation, or
- an affiliate or associate of the corporation and was the owner of 15% or
more of the outstanding voting stock of the corporation at any time
within the three-year period immediately prior to the date on which it is
sought to be determined whether the person is an interested stockholder.
Section 203 does not apply to a corporation that so provides in an
amendment to its certificate of incorporation or by-laws passed by a majority of
its outstanding shares at any time. This stockholder action does not become
effective for 12 months following its adoption and would not apply to persons
who were already interested stockholders at the time of the amendment. Our
Restated Certificate of Incorporation does not exclude us from the restrictions
imposed under Section 203.
Section 203 makes it more difficult for a person who would be an interested
stockholder to effect business combinations with a corporation for a three-year
period, although the shareholders may elect to exclude a corporation from the
restrictions imposed. The provisions of Section 203 may encourage companies
interested in acquiring us to negotiate in advance with our board of directors,
because the stockholder approval requirement would be avoided if a majority of
the directors then in office approve either the business combination or the
transaction which results in the stockholder becoming an interested stockholder.
These provisions also may have the effect of preventing changes in our
management. It is further possible that these provisions could make it more
difficult to accomplish transactions that stockholders may otherwise deem to be
in their best interest.
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DESCRIPTION OF WARRANTS
We may issue warrants, including warrants to purchase debt securities,
preferred stock, common stock or other of our securities. We may issue warrants
independently or together with any other securities, and they may be attached to
or separate from those securities. We will issue the other warrants under
warrant agreements between us and a bank or trust company, as warrant agent,
that we will describe in the prospectus supplement relating to the warrants that
we offer.
The following description of the terms of the warrants is a summary. It
summarizes only those terms of the warrants and the warrant agreement which we
believe will be most important to your decision to invest in our warrants. You
should keep in mind, however, that it is the warrant agreement and the warrant
certificate relating to the warrants, and not this summary, which defines your
rights as a warrantholder. There may be other provisions in the warrant
agreement and the warrant certificate relating to the warrants which are also
important to you. You should read these documents for a full description of the
terms of the warrants. Forms of these documents are filed as exhibits to the
Registration Agreement that includes this prospectus. See "Where You Can Find
More Information" for information on how to obtain copies of these documents.
DEBT WARRANTS
We will describe in the applicable prospectus supplement the terms of
warrants to purchase debt securities that we may offer, the warrant agreement
relating to the debt warrants and the warrant certificates representing the debt
warrants. These terms will include the following:
- the title of the debt warrants,
- the debt securities for which the debt warrants are exercisable,
- the aggregate number of the debt warrants,
- the principal amount of debt securities that you may purchase upon
exercise of each debt warrant, and the price or prices at which we will
issue the debt warrants,
- the procedures and conditions relating to the exercise of the debt
warrants,
- the designation and terms of any related debt securities issued with the
debt warrants, and the number of debt warrants issued with each debt
security,
- the date, if any, from which you may separately transfer the debt
warrants and the related securities,
- the date on which your right to exercise the debt warrants commences, and
the date on which your right expires,
- the maximum or minimum number of the debt warrants which you may exercise
at any time,
- if applicable, a discussion of material United States federal income tax
considerations,
- any other terms of the debt warrants and terms, procedures and
limitations relating to your exercise of the debt warrants, and
- the terms of the securities you may purchase upon exercise of the debt
warrants.
You may exchange debt warrant certificates for new debt warrant
certificates of different denominations and may exercise debt warrants at the
corporate trust office of the warrant agent or any other office that we indicate
in the applicable prospectus supplement. Prior to exercise, you will not have
any of the rights of holders of the debt securities purchasable upon that
exercise and will not be entitled to payments of principal, premium, if any, or
interest on the debt securities purchasable upon the exercise.
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OTHER WARRANTS
We may issue other warrants. We will describe in the applicable prospectus
supplement the following terms of those warrants:
- the title of the warrant,
- the securities, which may include preferred stock or common stock, for
which you may exercise the warrants,
- the price or prices at which we will issue the warrants,
- if applicable, the designation and terms of the preferred stock or common
stock issued with the warrants, the designation and terms of the
preferred stock or common stock issued with the warrants, and the number
of warrants issued with each share of preferred stock or common stock,
- if applicable, the date from which you may separately transfer the
warrants and the related preferred stock or common stock,
- if applicable, a discussion of material United States federal income tax
considerations, and
- any other terms of the warrants, including terms, procedures and
limitations relating to your exchange and exercise of the warrants.
We will also describe in the applicable prospectus supplement the amount of
securities called for by the warrants, any amount of warrants outstanding, and
any provisions for a change in the exercise price or the expiration date of the
warrants and the kind, frequency and timing of any notice to be given. Prior to
the exercise of your warrants, you will not have any of the rights of holders of
the preferred stock or common stock purchasable upon that exercise and will not
be entitled to dividend payments, if any, or voting rights of the preferred
stock or common stock purchasable upon the exercise.
EXERCISE OF WARRANTS
We will describe in the prospectus supplement relating to the warrants the
principal amount or the number of our securities that you may purchase for cash
upon exercise of a warrant, and the exercise price. You may exercise a warrant
as described in the prospectus supplement relating to the warrants at any time
up to the close of business on the expiration date stated in the prospectus
supplement. Unexercised warrants will become void after the close of business on
the expiration date, or any later expiration date that we determine.
We will forward the securities purchasable upon the exercise as soon as
practicable after receipt of payment and the properly completed and executed
warrant certificate at the corporate trust office of the warrant agent or other
office stated in the applicable prospectus supplement. If you exercise less than
all of the warrants represented by the warrant certificate, we will issue you a
new warrant certificate for the remaining warrants.
DESCRIPTION OF STOCK PURCHASE CONTRACTS AND STOCK PURCHASE UNITS
We may issue stock purchase contracts, including contracts obligating you
to purchase from us, and for us to sell to you, a specific number of shares of
common stock or preferred stock at a future date or dates. The price per share
of preferred stock or common stock may be fixed at the time the stock purchase
contracts are issued or may be determined by reference to a specific formula
described in the stock purchase contracts. We may issue the stock purchase
contract separately or as a part of units consisting of a stock purchase
contract and debt securities, trust preferred securities or debt obligations of
third parties, including U.S. Treasury securities, securing the your obligations
to purchase the preferred stock or the common stock under the purchase
contracts. The stock purchase contracts may require us to make periodic payments
to you or vice versa and the payments may be unsecured or prefunded on some
basis. The stock purchase contracts may require you to secure your obligations
in a specified manner. We will describe in the applicable prospectus supplement
the terms of any stock purchase contracts or stock purchase units.
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DESCRIPTION OF PREFERRED SECURITIES
The trustees of each trust will issue preferred securities and common
securities of the trust. The preferred securities will represent preferred
undivided beneficial interests in the assets of the related trust. As a holder
of trust preferred securities, you will generally be entitled to a preference
with respect to distributions and amounts payable on redemption or liquidation
over the common securities of the trust, as well as other benefits as described
in the corresponding trust agreement. Each of the trusts is a legally separate
entity and the assets of one are not available to satisfy the obligations of any
of the others.
The following description of the terms of the form of trust agreement is a
summary. It summarizes only those portions of the form of trust agreement which
we believe will be most important to your decision to invest in the preferred
securities. You should keep in mind, however, that it is the trust agreement,
and not this summary, which defines your rights as a holder. There may be other
provisions in the trust agreement which are also important to you. You should
read the form of trust agreement itself for a full description of the terms of
the preferred securities. The form of trust agreement is filed as an exhibit to
the Registration Statement. See "Where You Can Find More Information" for
information on how to obtain a copy of the trust agreement.
RANKING OF PREFERRED SECURITIES
The preferred securities of a trust will rank equally, and we will make
payments proportionately, with the common securities of the trust except as
described under "-- Subordination of Common Securities." The preferred
securities of each trust represent preferred undivided beneficial interests in
the assets of the trust. The property trustee will hold legal title to the
corresponding junior subordinated debentures in trust for the benefit of the
holders of the related preferred securities and common securities.
Each guarantee agreement that we execute for your benefit, as a holder of
preferred securities of a trust, will be a guarantee on a subordinated basis
with respect to the related preferred securities. However, our guarantee will
not guarantee payment of distributions or amounts payable on redemption or
liquidation of the preferred securities when the related trust does not have
funds on hand available to make such payments. See "Description of Guarantee."
DISTRIBUTIONS ON THE PREFERRED SECURITIES
The trust will pay the distributions on the preferred securities and common
securities at a rate specified in the prospectus supplement.
The amount of distributions the trust must pay for any period will be
computed on the basis of a 360-day year of twelve 30-day months unless we
otherwise specify in the applicable prospectus supplement. Distributions that
are in arrears may bear interest at the rate per annum specified in the
applicable prospectus supplement. The term "distributions" as we use it in this
prospectus includes any additional amounts provided in the corresponding trust
agreement.
Distributions on the preferred securities will be cumulative, will accrue
from the date of original issuance and will be payable on the dates specified in
the applicable prospectus supplement. If any date on which distributions are
payable on the preferred securities is not a business day, the trust will
instead make the payment on the next succeeding day that is a business day, and
without any interest or other payment on account of the delay. However, if that
business day is in the next succeeding calendar year, the trust will make the
payment on the immediately preceding business day. In each case payment will be
made with the same force and effect as if made on the date the payment was
originally due. When we use the term "business day" in this prospectus, we mean
any day other than a Saturday or a Sunday, or a day on which banking
institutions in the City of New York are authorized or required by law or
executive order to remain closed or a day on which the corporate trust office of
the property trustee or the debenture trustee is closed for business.
If provided in the applicable prospectus supplement, we have the right
under the junior subordinated indenture, the contract that provides the terms
for the corresponding junior subordinated debentures, to
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extend the interest payment period for a specified number of periods. However,
we may not extend these interest payments beyond the maturity of the junior
subordinated debentures. As a consequence of any extension, distributions on the
corresponding preferred securities would be deferred by the trust during the
extension period. These distributions would continue to accumulate additional
distributions at the rate per annum set form in the prospectus supplement.
If we exercise this right, during the extension period we and our
subsidiaries may not:
- declare or pay any dividends or distributions on, or redeem, purchase,
acquire or make a liquidation payment on, any of our capital stock, or
- make any payment of principal, premium, if any, or interest on or repay,
repurchase or redeem any debt securities that rank equally with or junior
in interest to the corresponding junior subordinated debentures or make
any related guarantee payments,
other than:
- dividends or distributions on our common stock,
- redemptions or purchases of any rights pursuant to our rights plan, or
any successor to our rights plan, and the declaration of a dividend of
these rights in the future, and
- payments under any guarantee.
We anticipate that the revenue of each trust available for distribution to
you, as a holder of preferred securities, will be limited to payments under the
corresponding junior subordinated debentures in which the trust will invest the
proceeds from the issuance and sale of its preferred securities and its common
securities. See "Description of Corresponding Junior Subordinated Debentures".
If we do not make interest payments on the corresponding junior
subordinated debentures, the property trustee will not have funds available to
pay distributions on the corresponding preferred securities. The payment of
distributions, if and to the extent the trust has funds legally available for
the payment of these distributions is guaranteed by us on a limited basis as set
forth under "Description of Guarantee".
The trust will pay distributions on the preferred securities to you
provided you are entered in the register of the trust on the relevant record
dates. As long as the preferred securities remain in book-entry form, the record
date will be one business day prior to the relevant distribution date. If any
preferred securities are not in book-entry form, the record date for the
preferred securities will be the date 15 days prior to the relevant distribution
date.
REDEMPTION
Redemption on a Repayment or Redemption of the Corresponding Junior
Subordinated Debentures
Upon the repayment or redemption, in whole or in part, of any corresponding
junior subordinated debentures, the property trustee must apply the proceeds
from that repayment or redemption to redeem a like amount of the corresponding
preferred securities. This redemption must be made upon not less than 30 nor
more than 60 days notice to you. The redemption price will be equal to the
aggregate liquidation preference of the preferred securities, plus accumulated
and unpaid distributions on the preferred securities to the date of redemption
and the related amount of any premium paid by us upon the concurrent redemption
of the corresponding junior subordinated debentures. See "Description of
Corresponding Junior Subordinated Debentures -- Optional Redemption."
If less than all of any series of corresponding junior subordinated
debentures are repaid or redeemed, then the proceeds from the repayment or
redemption will be allocated to redeem a proportionate amount of each of the
preferred securities and the common securities. The amount of premium, if any,
paid by us upon the redemption of all or any part of any series of any
corresponding junior subordinated debentures repaid or redeemed will be
allocated proportionately to the redemption of the preferred securities and the
common securities.
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We must repay the principal of the corresponding junior subordinated
debentures when they are due. In addition, we will have the right to redeem any
series of corresponding junior subordinated debentures:
- in whole or in part, subject to the conditions we describe under
"Description of Corresponding Junior Subordinated Debentures -- Optional
Redemption," or
- at any time, in whole, but not in part, upon the occurrence of a tax
event or an investment company event, each as defined below, and subject
to the further conditions we describe under "Description of Corresponding
Junior Subordinated Debentures -- Optional Redemption," or
- as we may otherwise specify in the applicable prospectus supplement.
Redemption or Distribution Upon the Occurrence of a Tax Event or an
Investment Company Event
If an event occurs that constitutes a tax event or an investment company
event we will have the right to:
- redeem the corresponding junior subordinated debentures in whole, but not
in part, and cause a mandatory redemption of the preferred securities and
common securities in whole, but not in part, within 90 days following the
occurrence of the tax event or an investment company event, or
- terminate the related trust and cause the corresponding junior
subordinated debentures to be distributed to the holders of the preferred
securities and common securities in liquidation of the trust.
If provided in the applicable prospectus supplement, we will have the right
to extend or shorten the maturity of any series of corresponding junior
subordinated debentures at the time that we exercise our right to elect to
terminate the related trust and cause the corresponding junior subordinated
debentures to be distributed to the holders of the preferred securities and
common securities in liquidation of the trust.
When we use the term "additional sums" in this prospectus we mean the
additional amounts that may be necessary in order that the amount of
distributions then due and payable by a trust on its outstanding preferred
securities and common securities will not be reduced as a result of any
additional taxes, duties and other governmental charges to which the trust has
become subject as a result of a tax event.
When we use the term "tax event" we mean the receipt by the trust of an
opinion of counsel experienced in those matters to the effect that, as a result
of any amendment to, or change, including any announced prospective change, in,
the laws of the United States or any political subdivision or taxing authority
affecting taxation, or as a result of any official administrative pronouncement
or judicial decision interpreting or applying those laws or regulations, which
amendment or change is effective or pronouncement or decision is announced on or
after the trust issues the preferred securities, there is more than an
insubstantial risk that:
- the trust is, or will be within 90 days of the date of the opinion,
subject to United States federal income tax with respect to income
received or accrued on the corresponding series of corresponding junior
subordinated debentures,
- interest payable by us on the series of corresponding junior subordinated
debentures is not, or within 90 days of the date of the opinion, will not
be, deductible, in whole or in part, for United States federal income tax
purposes or
- the trust is, or will be within 90 days of the date of the opinion,
subject to more than a de minimis amount of other taxes, duties or other
governmental charges.
When we use the term "investment company event" we mean 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 to the effect that the applicable trust is or will be considered an
investment company that is required to be registered under the Investment
Company Act of 1940,
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which change becomes effective on or after the date of original issuance of the
series of preferred securities issued by the trust.
When we use the term "like amount", we mean:
- with respect to a redemption of any series of preferred securities,
preferred securities having a liquidation amount equal to that portion of
the principal amount of corresponding junior subordinated debentures to
be contemporaneously redeemed, the proceeds of which will be used to pay
the redemption price of the preferred securities, and
- with respect to a distribution of corresponding junior subordinated
debentures to you, as a holder of preferred securities in connection with
a dissolution or liquidation of the related trust, corresponding junior
subordinated debentures having a principal amount equal to the
liquidation amount of your preferred securities.
When we use the term "liquidation amount", we mean the stated amount of $25
per preferred security and common security.
After the liquidation date fixed for any distribution of corresponding
junior subordinated debentures for any series of preferred securities:
- the series of preferred securities will no longer be deemed to be
outstanding,
- The Depositary Trust Company, which we refer to in this prospectus as a
"DTC," or its nominee, as the record holder of the series of preferred
securities, will receive a registered global certificate or certificates
representing the corresponding junior subordinated debentures to be
delivered upon that distribution, and
- any certificates representing the series of preferred securities not held
by DTC or its nominee will be deemed to represent the corresponding
junior subordinated debentures having a principal amount equal to the
stated liquidation preference of the series of preferred securities, and
bearing accrued and unpaid interest in an amount equal to the accrued and
unpaid distributions on the series of preferred securities until you
present the certificates to the administrative trustees or their agent
for transfer or reissuance.
We can make no assurance as to what the market prices will be for the
preferred securities or the corresponding junior subordinated debentures that
may be distributed to you in exchange for your preferred securities if a
dissolution and liquidation of a trust were to occur. Accordingly, the preferred
securities that you purchase, or the corresponding junior subordinated
debentures that you receive on dissolution and liquidation of a trust, may trade
at a discount to the price that you paid to purchase the preferred securities.
VOLUNTARY DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES
If we so provide in the applicable prospectus supplement, we may elect, at
any time, to terminate the trust and cause the corresponding junior subordinated
debentures to be distributed to you, as a holder of the preferred securities,
and us, as the holder of the common securities, in liquidation of the trust.
REDEMPTION PROCEDURES
The trust will redeem the preferred securities on each redemption date at
the redemption price with the applicable proceeds from the contemporaneous
redemption of the corresponding junior subordinated debentures. The trust will
make redemptions of the preferred securities and pay the redemption price only
to the extent that it has funds available for the payment of the redemption
price. See also "-- Subordination of Common Securities."
If a trust gives notice to you of redemption of your preferred securities,
then by 12:00 noon, New York City time, on the redemption date, to the extent
funds are available, the property trustee will
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irrevocably deposit with DTC funds sufficient to pay the applicable redemption
price and will give DTC irrevocable instructions and authority to pay the
redemption price to you. See "-- Book-Entry Issuance."
If the preferred securities are no longer in book-entry form, the trust, to
the extent funds are available, will irrevocably deposit with the paying agent
for the preferred securities funds sufficient to pay the applicable redemption
price to you and will give the paying agent irrevocable instructions and
authority to pay the redemption price to you upon surrender of your
certificates.
The trust will pay any distributions payable on or prior to the redemption
date for any preferred securities called for redemption to you on the relevant
record dates for the distribution. If the trust has given notice of redemption
and has deposited the required funds, then upon the date of the deposit, all
your rights will cease, except your right to receive the redemption price,
without interest on that redemption price, and your preferred securities will
cease to be outstanding. If any date fixed for redemption of preferred
securities is not a business day, then the trust will pay the redemption price
on the next succeeding day which is a business day, and without any interest or
other payment on account of the delay. However, if the business day falls in the
next calendar year, the trust will make the payment on the immediately preceding
business day. If payment of the redemption price is improperly withheld or
refused and not paid either by the trust or by us pursuant to the guarantee as
described under "Description of Guarantee", distributions on the preferred
securities will continue to accrue at the then applicable rate, from the
redemption date originally established by the trust for the preferred securities
to the date the redemption price is actually paid. In this case the actual
payment date will be the date fixed for redemption for purposes of calculating
the redemption price.
Subject to applicable law, including United States federal securities law,
we or our subsidiaries may at any time purchase outstanding preferred securities
by tender, in the open market or by private agreement.
The trust will make payment of the redemption price on the preferred
securities and any distribution of corresponding junior subordinated debentures
to the applicable record holders as they appear on the register for the
preferred securities on the relevant record date. This date will generally be
one business day prior to the relevant redemption date or liquidation date.
However, if any preferred securities are not in book-entry form, the relevant
record date for the preferred securities will be the date 15 days prior to the
redemption date or liquidation date.
If less than all of the preferred securities and common securities issued
by a trust are to be redeemed on a redemption date, then the aggregate
liquidation amount of the preferred securities and common securities to be
redeemed will be allocated proportionately among the preferred securities and
the common securities. The property trustee will select the particular preferred
securities to be redeemed on a proportionate basis not more than 60 days prior
to the redemption date from the outstanding preferred securities not previously
called for redemption, by any method that the property trustee deems fair and
appropriate. This method may provide for the selection for redemption of
portions, equal to $25 or an integral multiple of $25, of the liquidation amount
of preferred securities. The property trustee will promptly notify the trust
registrar in writing of the preferred securities selected for redemption and, in
the case of any preferred securities selected for partial redemption, the
liquidation amount of the preferred securities to be redeemed.
SUBORDINATION OF COMMON SECURITIES
The trust will make payment of distributions, any additional amounts and
the redemption price on the preferred securities and common securities
proportionately based on the liquidation amount of the preferred securities and
common securities. However, if on any distribution date or redemption date a
debenture event of default exists, the trust will not make any payment on the
common securities unless payment in full in cash of all accumulated and unpaid
distributions, any additional amounts and the full amount of the redemption
price on all of the outstanding preferred securities of the trust, has been made
or provided for. The property trustee will apply all available funds first to
the payment in full in cash of all distributions on the preferred securities
then due and payable.
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If any event of default resulting from a debenture event of default exists,
we as holder of the common securities of the trust will be deemed to have waived
any right to act with respect to the event of default under the trust agreement
until the effect of all those events of default with respect to the preferred
securities have been cured, waived or otherwise eliminated. Until any events of
default under the trust agreement with respect to the preferred securities have
been so cured, waived or otherwise eliminated, the property trustee will act
solely on your behalf, as a holder of the preferred securities, and not on our
behalf as holder of the common securities, and only you acting with the other
holders will have the right to direct the property trustee to act on your
behalf.
LIQUIDATION DISTRIBUTION UPON TERMINATION
Each trust will automatically terminate upon expiration of its term or the
redemption of all of the preferred securities of the trust. In addition, we will
terminate the trust on the first to occur of:
- our bankruptcy, dissolution or liquidation,
- the distribution of a like amount of corresponding junior subordinated
debentures to the holders of its preferred securities and common
securities, and
- the entry of an order for the dissolution of the trust by a court of
competent jurisdiction.
If an early termination occurs as described in the clauses above, the
trustees will liquidate the trust as expeditiously as the trustees determine to
be possible by distributing, after satisfaction of liabilities to creditors of
the trust as provided by applicable law, to the holders of the preferred
securities and common securities a like amount of corresponding junior
subordinated debentures. If the property trustee determines that this
distribution is not practical, you will be entitled to receive out of the assets
of the trust available for distribution, after satisfaction of liabilities to
creditors of the trust as provided by applicable law, an amount equal to the
aggregate of the liquidation amount plus accrued and unpaid distributions to the
date of payment. We refer to this liquidation amount in this prospectus as the
"liquidation distribution." If the trust can make the liquidation distribution
only in part because it has insufficient assets available to pay the full
aggregate liquidation distribution, then it will pay the amounts on a
proportionate basis. We, as the holder of the common securities, will be
entitled to receive distributions upon any liquidation proportionately with you,
and the other holders of the preferred securities, except that if an event
exists that constitutes a debenture event of default, the preferred securities
will have a priority over the common securities. A supplemental indenture may
provide that if an early termination occurs as described in the third clause
above, the corresponding junior subordinated debentures may be subject to
optional redemption in whole, but not in part.
EVENTS OF DEFAULT; NOTICE
Under the terms of the form of trust agreement, each of the following
constitutes an event of default for a series of preferred securities:
- the occurrence of a debenture event of default under the junior
subordinated indenture (see "Description of Junior Subordinated
Debentures -- Debenture Events of Default"),
- default by the property trustee in the payment of any distribution when
it becomes due and payable, and continuation of that default for a period
of 30 days,
- default by the property trustee in the payment of any redemption price of
the preferred securities or common securities when it becomes due and
payable,
- default in the performance, or breach, in any material respect, of any
covenant or warranty of the trustees in the trust agreement, other than a
covenant or warranty a default in the performance of which or the breach
of which is dealt with in the second and third clauses above, and
continuation of the default or breach for a period of 60 days after there
has been given to the defaulting trustee or trustees by the holders of at
least 10% in aggregate liquidation amount of the outstanding
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preferred securities, a written notice specifying the default or breach
and requiring it to be remedied and stating that the notice is a notice
of default under such trust agreement, or
- the bankruptcy or insolvency of the property trustee and our failure to
appoint a successor property trustee within 60 days of that event.
Within five business days after the occurrence of any event of default
actually known to the property trustee, the property trustee will transmit
notice of the event of default to you, the administrative trustees and us, as
depositor, unless the event of default has been cured or waived. We, as
depositor, and the administrative trustees are required to file annually with
the property trustee a certificate as to whether or not we are and they are in
compliance with all the conditions and covenants applicable to them and to us
under the trust agreement.
If a debenture event of default then exists, the preferred securities will
have a preference over the common securities upon termination of the trust. See
"-- Liquidation Distribution Upon Termination."
The existence of an event of default does not entitle you to accelerate the
maturity.
REMOVAL OF TRUSTEES
Unless a debenture event of default then exists, the holder of the common
securities may remove any trustee. If a debenture event of default then exists
the holders of a majority in liquidation amount of the outstanding preferred
securities may remove the property trustee and the Delaware trustee. In no event
will you have the right to vote to appoint, remove or replace the administrative
trustees. These voting rights are vested exclusively in us as the holder of the
common securities. No resignation or removal of a trustee and no appointment of
a successor trustee will be effective until the acceptance of appointment by the
successor trustee in accordance with the provisions of the trust agreement.
CO-TRUSTEES AND SEPARATE PROPERTY TRUSTEE
Unless an event of default then exists, for the purpose of meeting the
legal requirements of the Trust Indenture Act or of any jurisdiction in which
any part of the trust property may be located, we, as the holder of the common
securities, and the administrative trustees will have power to appoint one or
more persons either to act as a co-trustee, jointly with the property trustee,
of all or any part of the trust property, or to act as separate trustee. These
persons will have the powers provided in the instrument of appointment, and we
may vest in that person or persons any property, title, right or power deemed
necessary or desirable, subject to the provisions of the trust agreement. If a
debenture event of default exists, the property trustee alone will have power to
make that appointment.
MERGER OR CONSOLIDATION OF TRUSTEES
Any corporation into which the property trustee, the Delaware trustee or
any administrative trustee that is not a natural person may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the trustee is a party, or
any corporation succeeding to all or substantially all the corporate trust
business of the trustee, will be the successor of such trustee under the trust
agreements, provided that the corporation is otherwise qualified and eligible.
MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF THE TRUSTS
A trust may not merge with or into, consolidate, amalgamate, 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.
A trust may, at our request, with the consent of the administrative
trustees and without your consent, merge with or into, consolidate, amalgamate,
or be replaced by or convey, transfer or lease its properties
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and assets substantially as an entirety to a trust organized under the laws of
any state. However, the following conditions must be satisfied:
- the successor entity must either:
- expressly assume all of the obligations of the trust relating to the
preferred securities, or
- substitute for the preferred securities other securities having
substantially the same terms and the same ranking as the preferred
securities,
- we must expressly appoint a trustee of the successor entity possessing
the same powers and duties as the property trustee as the holder of the
corresponding junior subordinated debentures,
- the successor securities must be listed, or any successor securities must
be listed upon notification of issuance, on any national securities
exchange or other organization on which the preferred securities are then
listed,
- the merger, consolidation, amalgamation, replacement, conveyance,
transfer or lease must not cause the preferred securities, including any
successor securities, to be downgraded by any nationally recognized
statistical rating organization,
- the merger, consolidation, amalgamation, replacement, conveyance,
transfer or lease must not adversely affect the rights, preferences and
privileges of holders of the preferred securities, including any
successor securities, in any material respect,
- the successor entity must have a purpose identical to that of the trust,
- prior to the merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease we must have received an opinion from
independent counsel to the trust experienced in such matters to the
effect that:
- the merger, consolidation, amalgamation, replacement conveyance,
transfer or lease does not adversely affect the rights, preferences
and privileges of holders of the preferred securities, including any
successor securities, in any material respect, and
- following the merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease neither the trust nor the successor
entity will be required to register as an investment company under
the Investment Company Act, and
- we or any permitted successor or assignee must own all of the common
securities of the successor entity and guarantee the obligations of such
successor entity under the successor securities at least to the extent
provided by the guarantee.
However, a trust must not, except with the consent of holders of 100% in
liquidation amount of the preferred securities, 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 other entity or permit any other
entity to consolidate, amalgamate, merge with or into, or replace it if it would
cause the trust or the successor entity to be classified as other than a grantor
trust for federal income tax purposes.
VOTING RIGHTS; AMENDMENT OF TRUST AGREEMENT
Except as provided below and under "Description of Guarantee -- Amendments
and Assignment" and as otherwise required by law and the applicable trust
agreement, you will have no voting rights.
We and the trustees may amend a trust agreement without your consent:
- to cure any ambiguity, correct or supplement any provisions in the trust
agreement which may be inconsistent with any other provision, or to make
any other provisions with respect to matters or questions arising under
the trust agreement, which are not inconsistent with the other provisions
of the trust agreement, or
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- to modify, eliminate or add to any provisions of the trust agreement to
the extent necessary to ensure that the trust will be classified for
federal income tax purposes as a grantor trust at all times that any
preferred securities and common securities are outstanding, or to ensure
that the trust will not be required to register as an investment company
under the Investment Company Act.
However, in the case of the first clause above, the action may not adversely
affect in any material respect the interests of the holders of the preferred
securities or our interests, as the holder of the common securities. Any
amendments of the trust agreement will become effective when notice is given to
you and us.
We and the trustees may also amend a trust agreement with:
- the consent of holders representing not less than a majority, based upon
liquidation amounts, of the outstanding preferred securities and common
securities, and
- receipt by the trustees of an opinion of counsel to the effect that the
amendment or the exercise of any power granted to the trustees under the
amendment will not affect the status of the trust as a grantor trust for
federal income tax purposes or its exemption from status of an
"investment company" under the Investment Company Act.
Without both your and our consent a trust agreement may not be amended to:
- change the amount or timing of any distribution on the preferred
securities and common securities or otherwise adversely affect the amount
of any distribution of the preferred securities and common securities as
of a specified date, or
- restrict your or our right to institute suit for the enforcement of any
payment on or after that date.
So long as any corresponding junior subordinated debentures are held by the
property trustee, the trustees may not:
- direct the time, method and place of conducting any proceeding for any
remedy available to the debenture trustee, or for executing any trust or
power conferred on the property trustee with respect to the corresponding
junior subordinated debentures,
- waive any past default that is waiveable under specified sections of the
junior subordinated indenture,
- exercise any right to rescind or annul a declaration that the principal
of all the junior subordinated debentures is due and payable, or
- consent to any amendment, modification or termination of the junior
subordinated indenture or the corresponding junior subordinated
debentures, where that consent is required,
without, in each case, obtaining the prior approval of the holders of a majority
in aggregate liquidation amount of all outstanding preferred securities.
However, where a consent under the junior subordinated indenture would require
the consent of each holder of corresponding junior subordinated debentures
affected by the consent, no consent may be given by the property trustee without
the prior consent of each holder of the corresponding preferred securities.
The trustees may not revoke any action previously authorized or approved by
a vote of the preferred securities except by subsequent vote of the holders of
the preferred securities. The property trustee will notify you of any notice of
default with respect to the corresponding junior subordinated debentures. In
addition to obtaining the approval of the holders of the preferred securities
prior to taking any of these actions, the trustees must obtain an opinion of
counsel experienced in these matters to the effect that the trust will not be
classified as a corporation or partnership for United States federal income tax
purposes on account of the action.
Any required approval of holders of preferred securities may be given at a
meeting of holders of preferred securities convened for that purpose or through
a written consent. The property trustee will cause a notice of any meeting at
which you are entitled to vote, or of any matter upon which action by written
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consent is to be taken, to be given to each holder of record of preferred
securities in the manner set forth in the trust agreement.
Your vote or consent is not required for a trust to redeem and cancel the
preferred securities under the applicable trust agreement.
Any preferred securities that are owned by us, the trustees or any of our
affiliates or any affiliate of the trustees, will, for purposes of a vote or
consent, be treated as if they were not outstanding.
GLOBAL PREFERRED SECURITIES
We may issue a series of preferred securities in the form of one or more
global preferred securities. We will identify the depositary holding to global
preferred security in the applicable prospectus supplement. Unless we otherwise
indicate in the applicable prospectus supplement, the depositary will be DTC. We
will issue global preferred securities only in fully registered form and in
either temporary or permanent form. Unless it is exchanged for individual
preferred securities, a global preferred security may not be transferred except:
- by the depositary to its nominee,
- by a nominee of the depositary to the depositary or another nominee, or
- by the depositary or any nominee to a successor depositary, or any
nominee of the successor.
We will describe the specific terms of the depositary arrangement in the
applicable prospectus supplement. We expect that the following provisions will
generally apply to these depositary arrangements.
Beneficial Interests in a Global Preferred Security
If we issue a global preferred security, the depositary for the global
preferred security or its nominee will credit on its book-entry registration and
transfer system the aggregate liquidation amounts of the individual preferred
securities represented by the global preferred securities to the accounts of
participants. The accounts will be designated by the dealers, underwriters or
agents for the preferred securities, or by us if the preferred securities are
offered and sold directly by us. Ownership of beneficial interests in a global
preferred security will be limited to participants or persons that may hold
interests through participants. Ownership and transfers of beneficial interests
in the global preferred security will be shown on, and effected only through,
records maintained by the applicable depositary or its nominee, for interests of
participants, and the records of participants, for interests of persons who hold
through participants. The laws of some states require that you take physical
delivery of the securities in definitive form. These limits and laws may impair
your ability to transfer beneficial interests in a global preferred security.
So long as the depositary or its nominee is the registered owner of the
global preferred security, the depositary or nominee will be considered the sole
owner or holder of the preferred securities represented by the global preferred
security for all purposes under the trust agreement. Except as provided below,
you:
- will not be entitled to have any of the individual preferred securities
represented by the global preferred security registered in your name,
- will not receive or be entitled to receive physical delivery of any
preferred securities in definitive form, and
- will not be considered the owner of holder of the preferred security
under the trust agreement.
Payments of Distributions
We will pay distributions on global preferred securities to the depositary
that is the registered holder of the global security, or its nominee. The
depositary for the preferred securities will be solely responsible and liable
for all payments made on account of your beneficial ownership interests in the
global preferred
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security and for maintaining, supervising and reviewing any records relating to
your beneficial ownership interests.
We expect that the depositary or its nominee, upon receipt of any payment
of liquidation amount, premium or distributions, immediately will credit
participants' accounts with amounts in proportion to their respective beneficial
interests in the aggregate liquidation amount of the global preferred security
as shown on the records of the depositary or its nominee. We also expect that
payments by participants to owners of beneficial interests in the global
preferred security held through those participants will be governed by standing
instructions and customary practices, as is now the case with securities held
for the accounts of customers in bearer form or registered in "street name."
These payments will be the responsibility of those participants.
Issuance of Individual Preferred Securities
Unless we state otherwise in the applicable prospectus supplement, if a
depositary for a series of preferred securities is at any time unwilling, unable
or ineligible to continue as a depositary and we do not appoint a successor
depositary within 90 days, we will issue individual preferred securities in
exchange for the global preferred security. In addition, we may at any time and
in our sole discretion, subject to any limitations described in the prospectus
supplement relating to the preferred securities, determine not to have any
preferred securities represented by one or more global preferred securities. If
that occurs, we will issue individual preferred securities in exchange for the
global preferred security.
Further, we may specify that you may, on terms acceptable to us, the
property trustee and the depositary for the global preferred security, receive
individual preferred securities in exchange for your beneficial interests in a
global preferred security, subject to any limitations described in the
prospectus supplement relating to the preferred securities. In that instance,
you will be entitled to physical delivery of individual preferred securities
equal in liquidation amount to that beneficial interest and to have the
preferred securities registered in its name. Unless we otherwise specify, those
individual preferred securities will be issued in denominations of $25 and
integral multiples of $25.
PAYMENT AND PAYING AGENCY
The trust will make payments on the preferred securities to DTC, which will
credit the relevant accounts at DTC on the applicable distribution dates.
However, if any preferred securities are not held by DTC, the trust will make
the payments by check mailed to the address of the holder entitled to the
payment as shown on the register. Unless we state otherwise in the applicable
prospectus supplement, the paying agent will initially be the property trustee,
together with any co-paying agent chosen by the property trustee and acceptable
to the administrative trustees and us. The paying agent may resign as paying
agent upon 30 days' written notice to the property trustees and us. If the
property trustee ceases to be the paying agent, the administrative trustees will
appoint a successor to act as paying agent. The successor must be a bank or
trust company acceptable to the administrative trustees and us.
REGISTRAR AND TRANSFER AGENT
Unless we state otherwise in the applicable prospectus supplement, the
property trustee will act as registrar and transfer agent for the preferred
securities.
The trust will register transfers of preferred securities without charge,
but upon your payment of any tax or other governmental charges that may be
imposed in connection with any transfer or exchange. The trust will not be
required to register the transfer of its preferred securities after the
preferred securities have been called for redemption.
INFORMATION CONCERNING THE PROPERTY TRUSTEE
The property trustee, unless an event of default then exists, will be
required to perform only those duties that are specifically set forth in the
applicable trust agreement. After an event of default, the
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property trustee must exercise the same degree of care and skill as a prudent
person would exercise or use in the conduct of his or her own affairs. However,
the property trustee is under no obligation to exercise any of the powers vested
in it by the trust agreement at your request unless you offer reasonable
indemnity against the costs, expenses and liabilities that it might incur. If no
event of default then exists and the property trustee is required to decide
between alternative causes of action, construe ambiguous provisions in a trust
agreement or is unsure of the application of any provision of a trust agreement,
and the matter is not one on which holders are entitled under the trust
agreement to vote, then the property trustee will take such action as is
directed by us. If it is not so directed, the property trustee will take such
action as it deems advisable and in the best interests of the holders of the
preferred securities and the holder of the common securities and will have no
liability except for its own bad faith, negligence or willful misconduct.
MISCELLANEOUS
The trust agreements authorize and direct the administrative trustees to
operate the related trusts in such a way that the trust will not be deemed to be
an investment company required to be registered under the Investment Company Act
or taxed as a corporation for federal income tax purposes and so that the
corresponding junior subordinated debentures will be treated as our indebtedness
for United States federal income tax purposes. We and the administrative
trustees are authorized to take any action, not inconsistent with applicable
law, the certificate of trust of the trust or the trust agreement, that we and
the administrative trustees determine in our discretion to be necessary or
desirable for these purposes, as long as the action does not materially
adversely affect the interests of the holders of the preferred securities.
You have no preemptive or similar rights as a holder of preferred
securities. No trust may borrow money or issue debt or mortgage or pledge any of
its assets.
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DESCRIPTION OF GUARANTEE
At the same time as the issuance by a trust of its preferred securities, we
will execute and deliver a guarantee for your benefit, as a holder of the
preferred securities. The Wilmington Trust Company will act as indenture trustee
under the guarantee for the purposes of compliance with the Trust Indenture Act.
The guarantee will be qualified as an indenture under the Trust Indenture Act.
The following description of the terms of the guarantee is a summary. It
summarizes only those portions of the guarantee which we believe will be most
important to your decision to invest in the preferred securities. You should
keep in mind, however, that it is the guarantee, and not this summary, which
defines your rights. There may be other provisions in the guarantee which are
also important to you. You should read the guarantee itself for a full
description of its terms. The guarantee is filed as an exhibit to the
Registration Statement that includes this prospectus. See "Where You Can Find
More Information" for information on how to obtain a copy of the guarantee. When
we refer in this summary to preferred securities, we mean the preferred
securities issued by a trust to which the guarantee relates.
GENERAL TERMS OF THE GUARANTEE
We will irrevocably agree to pay in full on a subordinated basis, to the
extent described below, the guarantee payments, as defined below, to you, as and
when due, regardless of any defense, right of set-off or counterclaim that the
trust may have or assert other than the defense of payment.
The following payments, which we refer to in this prospectus as the
"guarantee payments," to the extent not paid by or on behalf of the related
trust, will be subject to the guarantee:
- any accumulated and unpaid distributions required to be paid to you on
the related preferred securities, to the extent that the trust has funds
available for the payments,
- the redemption price for any preferred securities called for redemption,
to the extent that the trust has funds available for the payments, or
- upon a voluntary or involuntary dissolution, winding up or liquidation of
the trust, unless the corresponding junior subordinated debentures are
distributed to you, the lesser of:
- the liquidation distribution, and
- the amount of assets of the trust remaining available for distribution
to you.
Our obligation to make a guarantee payment may be satisfied by us directly
paying to you the required amounts or by causing the trust to pay the amounts to
you.
The guarantee will be an irrevocable guarantee on a subordinated basis of
the related trust obligations under the preferred securities, but will apply
only to the extent that the related trust has funds sufficient to make the
payments. It is not a guarantee of collection.
If we do not make interest payments on the corresponding junior
subordinated debentures held by the trust, we expect that the trust will not pay
distributions on the preferred securities and will not have funds legally
available for those payments. The guarantee will rank subordinate and junior in
right of payment to all senior debt. See "-- Status of Guarantee."
As a non-operating holding company, most of our operating assets and the
assets of our consolidated subsidiaries are owned by our subsidiaries. We rely
primarily on dividends from our subsidiaries to meet our obligations for payment
of principal and interest on our outstanding debt obligations and corporate
expenses. Accordingly, our obligations under the guarantee will be effectively
subordinated to all existing and future liabilities of our subsidiaries. You
should rely only on our assets for payments we owe. The payment of dividends by
our insurance company subsidiaries, including Hartford Fire, is limited under
the insurance holding company laws in which those subsidiaries are domiciled.
See "The Hartford Financial Services Group, Inc."
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Unless we state otherwise in the applicable prospectus supplement, the
guarantee does not limit the amount of secured or unsecured debt that we may
incur. We expect from time to time to incur additional senior debt.
We have, through the guarantee, the trust agreement, the junior
subordinated debentures, the junior subordinated indenture and the expense
agreement, taken together, fully, irrevocably and unconditionally guaranteed all
of the obligations of the trust under the preferred securities. No single
document standing alone or operating in conjunction with fewer than all of the
other documents constitutes the guarantee. It is only the combined operation of
these documents that has the effect of providing a full, irrevocable and
unconditional guarantee of the obligations of the trust under the preferred
securities. See "Relationship Among the Preferred Securities, the Junior
Subordinated Debentures and the Guarantee."
STATUS OF THE GUARANTEE
The guarantee will constitute an unsecured obligation of The Hartford
Financial Services Group, Inc. and will rank subordinate and junior in right of
payment to all its senior debt.
Unless we state otherwise in the applicable prospectus supplement, the
guarantee of a series of preferred securities will rank equally with the
guarantees relating to all other series of preferred securities that we may
issue. The guarantee will constitute a guarantee of payment and not of
collection, which means that the guaranteed party may institute a legal
proceeding directly against us to enforce its rights under the guarantee without
first instituting a legal proceeding against any other person or entity. The
property trustee of the related trust will hold the guarantee for your benefit.
The guarantee will not be discharged except by payment of the guarantee payments
in full to the extent not paid by the trust or upon distribution of the
corresponding junior subordinated debentures to you.
AMENDMENTS AND ASSIGNMENT
We may not amend the guarantee without the prior approval of the holders of
not less than a majority of the aggregate liquidation amount of outstanding
preferred securities, except for any changes which do not materially adversely
affect the rights of the holders of the preferred securities, in which case no
vote will be required. The manner of obtaining any approval will be as set forth
under "Description of the Preferred Securities -- Voting Rights; Amendment of
Trust Agreement."
All guarantees and agreements contained in the guarantee will bind our
successors, assigns, receivers, trustees and representatives and will inure to
the benefit of the holders of the related preferred securities then outstanding.
EVENTS OF DEFAULT
An event of default under the guarantee will occur when we fail to perform
any of our payment or other obligations under the guarantee. The holders of not
less than a majority in aggregate liquidation amount of the related preferred
securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the guarantee trustee under the guarantee
or to direct the exercise of any trust or power conferred upon the guarantee
trustee under the guarantee.
You may institute a legal proceeding directly against us to enforce your
rights under the guarantee without first instituting a legal proceeding against
the trust, the guarantee trustee or any other person or entity.
We, as guarantor, are required to file annually with the guarantee trustee
a certificate as to whether or not we are in compliance with all the conditions
and covenants applicable to us under the guarantee.
INFORMATION CONCERNING THE GUARANTEE TRUSTEE
The guarantee trustee, unless a default by us in the performance of the
guarantee then exists, is required to perform only those duties that are
specifically set forth in the guarantee. After a default under
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the guarantee, the guarantee trustee must exercise the same degree of care and
skill as a prudent person would exercise or use in the conduct of his or her own
affairs. However, the guarantee trustee is under no obligation to exercise any
of the powers vested in it by the guarantee at your request unless you offer
reasonable indemnity against the costs, expenses and liabilities that it might
incur.
TERMINATION OF THE GUARANTEE
The guarantee will terminate and be of no further force and effect:
- upon full payment of the redemption price of the related preferred
securities,
- upon full payment of the amounts payable upon liquidation of the related
trust, or
- upon distribution of corresponding junior subordinated debentures to the
holders of the preferred securities.
The guarantee will continue to be effective or will be reinstated if at any time
you must restore payment of any sums paid under the preferred securities or the
guarantee.
GOVERNING LAW
The guarantee will be governed by and construed in accordance with the laws
of the State of New York.
THE EXPENSE AGREEMENT
Under an expense agreement entered into by us, we will irrevocably and
unconditionally guarantee to each person or entity to whom a trust becomes
indebted or liable, the full payment of any costs, expenses or liabilities of
the trust, other than obligations of the trust to pay to you the amounts due to
you under the terms of the preferred securities.
DESCRIPTION OF CORRESPONDING JUNIOR SUBORDINATED DEBENTURES
The corresponding junior subordinated debentures are to be issued in one or
more series of junior subordinated debentures under the junior subordinated
indenture with terms corresponding to the terms of the related preferred
securities. See "Description of Junior Subordinated Debentures."
The following description of the terms of the corresponding junior
subordinated debentures and the junior subordinated indenture is a summary. It
summarizes only those portions of the junior subordinated indenture which we
believe will be most important to your decision to invest in the preferred
securities. You should keep in mind, however, that it is the junior subordinated
indenture, and not this summary, which defines your rights. There may be other
provisions in the junior subordinated indenture which are also important to you.
You should read the form of the junior subordinated indenture itself for a full
description of its terms. The form of junior subordinated indenture is filed as
an exhibit to the Registration Statement that includes this prospectus. See
"Where You Can Find More Information" for information on how to obtain a copy of
the junior subordinated indenture.
GENERAL TERMS OF THE CORRESPONDING JUNIOR SUBORDINATED DEBENTURES
At the same time a trust issues preferred securities, the trust will invest
the proceeds from the sale and the consideration paid by us for the common
securities in a series of corresponding junior subordinated debentures issued by
us to the trust. Each series of corresponding junior subordinated debentures
will be in the principal amount equal to the aggregate stated liquidation amount
of the related preferred securities plus our investment in the common securities
and, unless we state otherwise in the applicable prospectus supplement, will
rank equally with all other series of corresponding junior subordinated
debentures. The corresponding junior subordinated debentures will be unsecured
and subordinate and junior in right of payment to the extent and in the manner
set forth in the junior subordinated indenture to all our senior
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debt. See "Description of Junior Subordinated Debentures -- Subordination" and
the prospectus supplement relating to any offering of related preferred
securities.
OPTIONAL REDEMPTION
Unless we state otherwise in the applicable prospectus supplement, we may,
at our option, redeem the corresponding junior subordinated debentures on any
interest payment date, in whole or in part. Unless we state otherwise in the
applicable prospectus supplement, the redemption price for any corresponding
junior subordinated debentures will be equal to any accrued and unpaid interest
to the date fixed for redemption, plus the greater of:
- the principal amount of the debentures, and
- an amount equal to the discounted remaining fixed amount payments. See
"Description of Junior Subordinated Debentures -- Redemption."
If a tax event or an investment company event exists, we may, at our
option, redeem the corresponding junior subordinated debentures on any interest
payment date falling within 90 days of the occurrence of the tax event or
investment company event, in whole but not in part, subject to the provisions of
the junior subordinated indenture. The redemption price for any corresponding
junior subordinated debentures will be equal to 100% of the principal amount of
the corresponding junior subordinated debentures then outstanding plus accrued
and unpaid interest to the date fixed for redemption.
For so long as the applicable trust is the holder of all the outstanding
series of corresponding junior subordinated debentures, the trust will use the
proceeds of any redemption to redeem the corresponding preferred securities. We
may not redeem a series of corresponding junior subordinated debentures in part
unless all accrued and unpaid interest has been paid in full on all outstanding
corresponding junior subordinated debentures of the series for all interest
periods terminating on or prior to the redemption date.
COVENANTS OF THE HARTFORD FINANCIAL SERVICES GROUP, INC.
We will covenant in the junior subordinated indenture for each series of
corresponding junior subordinated debentures that we will pay additional sums to
the trust, if:
- the trust that has issued the corresponding series of preferred
securities and common securities is the holder of all of the
corresponding junior subordinated debentures,
- a tax event exists, and
- we have elected and have not revoked the election to pay additional sums
for the preferred securities and common securities.
We will also covenant, for each series of corresponding junior subordinated
debentures, that we and our subsidiaries will not:
- declare or pay any dividends or distributions on, or redeem, purchase,
acquire, or make a liquidation payment on any of our capital stock, or
- make any payment of principal of, interest or premium, if any, on or
repay or repurchase or redeem any debt securities, including other
corresponding junior subordinated debentures, that rank equally with or
junior in interest to the corresponding junior subordinated debentures or
make any related guarantee payments,
other than:
- dividends or distributions on our common stock,
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- redemptions or purchases of any rights pursuant to our rights plan, or
any successor to our rights plan, and the declaration of a dividend of
these rights in the future, and
- payments under any guarantee of preferred securities,
if at that time:
- there has occurred any event of which we have actual knowledge that with
the giving of notice or the lapse of time, or both, would constitute an
"event of default" under the junior subordinated indenture for that
series of corresponding junior subordinated debentures which we have not
taken reasonable steps to cure,
- we are in default on our payment of any obligations under the related
guarantee, or
- we have given notice of our selection of an extension period as provided
in the junior subordinated indenture for that series of corresponding
junior subordinated debentures and have not rescinded that notice, or the
extension period, or any extension, is continuing.
We will also covenant, for each series of corresponding junior subordinated
debentures:
- to maintain, by ourselves or our permitted successors, directly or
indirectly 100% ownership of the common securities of the trust to which
corresponding junior subordinated debentures have been issued,
- not to voluntarily terminate, wind-up or liquidate any trust, except in
connection with a distribution of corresponding junior subordinated
debentures to you in liquidation of the trust, or in connection with
mergers, consolidations or amalgamations permitted by the related trust
agreement, and
- to use our reasonable efforts, consistent with the terms and provisions
of the related trust agreement, to cause the trust to remain a business
trust and not to be classified as an association taxable as a corporation
for United States federal income tax purposes.
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RELATIONSHIP AMONG THE PREFERRED SECURITIES, THE CORRESPONDING JUNIOR
SUBORDINATED DEBENTURES AND THE GUARANTEES
As long as payments of interest and other payments are made when due on
each series of corresponding junior subordinated debentures, these payments will
be sufficient to cover distributions and other payments due on the related
preferred securities, primarily because:
- the aggregate principal amount of each series of corresponding junior
subordinated debentures will be equal to the sum of the aggregate stated
liquidation amount of the corresponding preferred securities and
corresponding common securities,
- the interest rate and interest and other payment dates on each series of
corresponding junior subordinated debentures will match the distribution
rate and distribution and other payment dates for the corresponding
preferred securities,
- we will pay for all and any costs, expenses and liabilities of the trust
except the obligations of the trust to holders of its preferred
securities under the preferred securities, and
- each trust agreement further provides that the trust will not engage in
any activity that is not consistent with the limited purposes of the
trust.
We will irrevocably guarantee payments of distributions and other amounts
due on the preferred securities, to the extent the trust has funds available for
the payment of such distributions, to the extent set forth under "Description of
Guarantee".
Taken together, our obligations under each series of junior subordinated
debentures, the junior subordinated indenture, the related trust agreement, the
related expense agreement and the related guarantee provide a full, irrevocable
and unconditional guarantee of payments of distributions and other amounts due
on the related series of preferred securities. No single document standing alone
or operating in conjunction with fewer than all of the other documents
constitutes the guarantee. It is only the combined operation of these documents
that has the effect of providing a full, irrevocable and unconditional guarantee
of the obligations of the trust under the preferred securities. If and to the
extent that we do not make payments on any series of corresponding junior
subordinated debentures, the trust will not pay distributions or other amounts
due on its preferred securities.
Notwithstanding anything to the contrary in the junior subordinated
indenture, we have the right to set-off any payment we are otherwise required to
make under the indenture with and to the extent we have made or are making a
payment under the related guarantee.
You may institute a legal proceeding directly against us to enforce your
rights under the related guarantee without first instituting a legal proceeding
against the guarantee trustee, the related trust or any other person or entity.
The preferred securities of each trust evidence your rights to the benefits
of the trust. Each trust exists for the sole purpose of issuing its preferred
securities and common securities, investing the proceeds from the sale of such
securities in corresponding junior subordinated debentures and related purposes.
A principal difference between your rights as a holder of a preferred
security and the rights of a holder of a corresponding junior subordinated
debenture is that a holder of a corresponding junior subordinated debenture will
accrue, and, subject to the permissible extension of the interest period, is
entitled to receive, interest on the principal amount of corresponding junior
subordinated debentures held, while you are only entitled to receive
distributions if and to the extent the trust has funds available for the payment
of those distributions.
Upon any voluntary or involuntary termination, winding-up or liquidation of
any trust involving the liquidation of the corresponding junior subordinated
debentures, you will be entitled to receive, out of assets held by the trust,
the liquidation distribution in cash. See "Description of Preferred
Securities -- Liquidation Distribution Upon Termination."
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Upon any voluntary or involuntary liquidation or bankruptcy of The Hartford
Financial Services Group, Inc., the property trustee, as holder of the
corresponding junior subordinated debentures, would be a subordinated creditor.
In this case, the property trustee would be subordinated in right of payment to
all senior debt, but entitled to receive payment in full of principal and
interest, before any of our stockholders receive payments or distributions.
Since we are the guarantor under each guarantee and have agreed to pay for all
costs, expenses and liabilities of each trust, your position as a holder of the
preferred securities and the position of a holder of the corresponding junior
subordinated debentures relative to other creditors and to our stockholders in
the event of liquidation or bankruptcy of our company would be substantially the
same.
A default or event of default under any senior debt would not constitute a
default or event of default under the junior subordinated indenture. However, in
the event of payment defaults under, or acceleration of, senior debt, the
subordination provisions of the junior subordinated indenture provide that we
may not make payments on the corresponding junior subordinated debentures until
the senior debt has been paid in full or any payment default under the senior
debt has been cured or waived. Our failure to make required payments on any
series of corresponding junior subordinated debentures would constitute an event
of default under the junior subordinated indenture.
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PLAN OF DISTRIBUTION
We may sell the securities offered by this prospectus through agents,
underwriters, dealers or directly to purchasers.
Agents who we designate may solicit offers to purchase the securities.
- We will name any agent involved in offering or selling securities, and
any commissions that we will pay to the agent, in our prospectus
supplement.
- Unless we indicate otherwise in our prospectus supplement, our agents
will act on a best efforts basis for the period of their appointment.
- Our agents may be deemed to be underwriters under the Securities Act of
1933 of any of the securities that they offer or sell.
We may use an underwriter or underwriters in the offer or sale of our
securities.
- If we use an underwriter or underwriters, we will execute an underwriting
agreement with the underwriter or underwriters at the time that we reach
an agreement for the sale of the securities.
- We will include the names of the specific managing underwriter or
underwriters, as well as any other underwriters, and the terms of the
transactions, including the compensation the underwriters and dealers
will receive, in our prospectus supplement.
- The underwriters will use our prospectus supplement to sell the
securities.
We may use a dealer to sell the securities.
- If we use a dealer, we, as principal, will sell the securities to the
dealer.
- The dealer will then sell the securities to the public at varying prices
that the dealer will determine at the time it sells our securities.
- We will include the name of the dealer and the terms of our transactions
with the dealer in our prospectus supplement.
We may solicit directly offers to purchase the securities, and we may
directly sell the securities to institutional or other investors. We will
describe the terms of our direct sales in our prospectus supplement.
We may indemnify agents, underwriters, and dealers against certain
liabilities, including liabilities under the Securities Act. Our agents,
underwriters, and dealers, or their affiliates, may be customers of, engage in
transactions with or perform services for us, in the ordinary course of
business.
We may authorize our agents and underwriters to solicit offers by certain
institutions to purchase the securities at the public offering price under
delayed delivery contracts.
- If we use delayed delivery contracts, we will disclose that we are using
them in the prospectus supplement and will tell you when we will demand
payment and delivery of the securities under the delayed delivery
contracts.
- These delayed delivery contracts will be subject only to the conditions
that we describe in the prospectus supplement.
- We will describe in our prospectus supplement the commission that
underwriters and agents soliciting purchases of the securities under
delayed contracts will be entitled to receive.
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LEGAL OPINIONS
Unless we state otherwise in the applicable prospectus supplement the
validity of any securities offered by this prospectus will be passed upon for us
by Michael S. Wilder, our General Counsel, and for the trusts by Richards,
Layton & Finger, special Delaware counsel to the trusts and for any underwriters
or agents by counsel that we will name in the applicable prospectus supplement.
EXPERTS
The audited consolidated financial statements and schedules of The Hartford
Financial Services Group, Inc. and subsidiaries incorporated by reference in
this prospectus and in the Registration Statement have been audited by Arthur
Andersen LLP, independent public accountants, as indicated in their report with
respect thereto, and are incorporated by reference herein and in the
Registration Statement in reliance upon the authority of said firm as experts in
accounting and auditing in giving said report.
WHERE YOU CAN FIND MORE INFORMATION
This prospectus is part of a Registration Statement that we filed with the
Securities and Exchange Commission. The Registration Statement, including the
attached exhibits, contains additional relevant information about us. The rules
and regulations of the Securities and Exchange Commission allow us to omit some
of the information about The Hartford Financial Services Group, Inc. In
addition, we file reports, proxy statements and other information with the
Securities and Exchange Commission. This information may be inspected and copied
at the public reference facilities maintained by the Securities and Exchange
Commission at:
- Room 1024, 450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C.
20549;
- 7 World Trade Center, 13th Floor, Suite 1300, New York, New York 10048;
and
- Suite 1400, Northwestern Atrium Center, 14th Floor, 500 West Madison
Street, Chicago, Illinois 60611.
COPIES OF THIS MATERIAL CAN BE OBTAINED AT PRESCRIBED RATES FROM THE PUBLIC
REFERENCE SECTION OF THE SECURITIES AND EXCHANGE COMMISSION AT ROOM 1024, 450
FIFTH STREET, N.W., JUDICIARY PLAZA, WASHINGTON, D.C. 20549. THE MATERIAL MAY
ALSO BE ACCESSED ELECTRONICALLY BY MEANS OF THE SECURITIES AND EXCHANGE
COMMISSION'S HOME PAGE ON THE INTERNET AT http://www.sec.gov.
Our common stock is listed on the New York Stock Exchange, Inc. You can
also inspect reports and other information concerning us at the office of the
New York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005.
INCORPORATION BY REFERENCE
The rules of the Securities and Exchange Commission allow us to incorporate
by reference information into this prospectus. The information incorporated by
reference is considered to be a part of this prospectus, and information that we
file later with the Securities and Exchange Commission will automatically update
and supercede this information. This prospectus incorporates by reference the
documents listed below.
- Our Annual Report on Form 10-K for the year ended December 31, 1999,
- Our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2000,
June 30, 2000 and September 30, 2000,
- Our Current Reports on Form 8-K filed on March 31, 2000, May 18, 2000,
June 23, 2000 and June 27, 2000,
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- Description of our common stock and the rights associated with our common
stock contained in our registration statement on Form 8-A, dated
September 18, 1995 (as amended by the Form 8-A/A filed on November 15,
1995); and
- all documents filed by us pursuant to Sections 13(a), 13(c), 14 and 15(d)
of the Exchange Act after the date of this prospectus.
We will provide without charge to each person to whom a copy of this
prospectus is delivered, upon written or oral request of such person, a copy of
any or all of the documents referred to above which have been or may be
incorporated by reference in this prospectus, other than certain exhibits to
those documents. You should direct requests for those documents to The Hartford
Financial Services Group, Inc., Hartford Plaza, Hartford, Connecticut 06115,
Attention: Secretary (Telephone: 860-547-5000).
------------------------
No person has been authorized to give any information or to make any
representations, other than those contained or incorporated by reference in this
prospectus and, if given or made, such information or representation must not be
relied upon as having been authorized by The Hartford Financial Services Group,
Inc., or any underwriter, agent or dealer. Neither the delivery of this
prospectus nor any sale made hereunder shall under any circumstances create any
implication that there has been no change in the affairs of The Hartford
Financial Services Group, Inc. since the date hereof or that the information
contained or incorporated by reference herein is correct as of any time
subsequent to the date of such information. This prospectus does not constitute
an offer to sell or a solicitation of an offer to buy any securities by anyone
in any jurisdiction in which such offer or solicitation is not authorized or in
which the person making such offer or solicitation is not qualified to do so or
to any person to whom it is unlawful to make such offer or solicitation.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth those expenses to be incurred by The
Hartford Financial Services Group, Inc. in connection with the issuance and
distribution of the securities being registered. Except for the Securities and
Exchange Commission filing fee, all amounts shown are estimates.
Securities and Exchange Commission filing fee............... $264,000
Fees and expenses of Trustee................................ $ 15,000
Printing and engraving expenses............................. $ 14,000
Accountant's fees and expenses.............................. $ 7,000
Legal fees and expenses..................................... $250,000
Miscellaneous expenses...................................... $ 10,000
--------
Total............................................. $560,000
========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law, as amended, provides
in regards to indemnification of directors and officers as follows:
145. Indemnification of Officers, Directors, Employees and Agents;
Insurance.
(a) A corporation may 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 an action by or in the right of the corporation) by reason of the
fact that he 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, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he 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 his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he 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 reasonable cause to believe that his conduct was unlawful.
(b) A corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the corporation to procure a judgment in its favor by
reason of the fact that he is or was a director, officer, employee or agent the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit it he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable 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
upon application 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 the Court of Chancery or such other court
shall deem proper.
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(c) To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections (a) and (b) of this
section, or in defense of any claim, issue or matter therein, he shall be
indemnified against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
(d) Any indemnification under subsections (a) and (b) of this section
(unless ordered by a court) shall be made by the corporation only as authorized
in the specific case upon a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances because he has met the
applicable standard of conduct set forth in subsections (a) and (b) of this
section. Such determination shall be made (1) by a majority vote of the
directors who were not parties to such action, suit or proceeding even though
less than a quorum, or (2) if there are no such directors, or, if such directors
so direct, by independent legal counsel in a written opinion, or (3) by the
stockholders.
(e) Expenses (including attorneys' fees) incurred by an officer or director
in defending any civil, criminal, administrative or investigative action, suit
or proceeding may be paid by the corporation in advance of the final disposition
of such action, suit or proceeding upon receipt of an undertaking by or on
behalf of such director or officer to repay such amount if it shall ultimately
be determined that he is not entitled to be indemnified by the corporation as
authorized in this section. Such expenses (including attorneys' fees) incurred
by other employees and agents may be so paid upon such terms and conditions, if
any, as the board of directors deems appropriate.
(f) The indemnification and advancement of expenses provided by, or granted
pursuant to, the other subsections of this section shall not be deemed exclusive
of any other rights to which those seeking indemnification or advancement of
expenses may be entitled under any bylaw, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such office.
(g) A corporation shall have power to purchase and maintain insurance on
behalf of any person who 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, joint
venture, trust or other enterprise against any liability asserted against him
and incurred by him in any such capacity, or arising out of his status as such,
whether or not the corporation would have the power to indemnify him against
such liability under this section.
(h) For purposes of this section, references to "the corporation" shall
include, in addition to the resulting corporation, any constituent corporation
(including any constituent of a constituent) absorbed in a consolidation or
merger which, if its separate existence had continued, would have had power and
authority to indemnify its directors, officers, and employees or agents, so that
any person who is or was a director, officer, employee or agent of such
constituent corporation, or is or was serving at the request of such constituent
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, shall stand in the same
position under this section with respect to the resulting or surviving
corporation as he would have with respect to such constituent corporation if its
separate existence had continued.
(i) For purposes of this section, references to "other enterprises" shall
include employee benefit plans; references to "fines" shall include any excise
taxes assessed on a person with respect to any employee benefit plan; and
references to "serving at the request of the corporation" shall include any
service as a director, officer, employee or agent of the corporation which
imposes duties on, or involves services by, such director, officer, employee, or
agent with respect to an employee benefit plan, its participants or
beneficiaries; and a person who acted in good faith and in a manner he
reasonably believed to be in the interest of the participants and beneficiaries
of an employee benefit plan shall be deemed to have acted in a manner "not
opposed to the best interests of the corporation" as referred to in this
section.
(j) The indemnification and advancement of expenses provided by, or granted
pursuant to, this section shall, unless otherwise provided when authorized or
ratified, continue as to a person who has
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ceased to be a director, officer, employee or agent and shall inure to the
benefit of the heirs, executors and administrators of such a person.
Article 4 of The Hartford Financial Services Group, Inc. By-laws provides
in regard to indemnification of directors and officers as follows:
4.1(a) Right to Indemnification. The Corporation, to the fullest
extent permitted by applicable law as then in effect, shall indemnify any
person who is or was a Director or officer of the Corporation and who is or
was involved in any manner (including, without limitation, as a party or a
witness) or is threatened to be made so involved in any threatened, pending
or completed investigation, claim, action, suit or proceeding, whether
civil, criminal, administrative or investigative (including, without
limitation, any action, suit or proceeding by or in the right of the
Corporation to procure a judgment in its favor) (a "Proceeding") by reason
of the fact that such person 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, fiduciary or agent of another
corporation, partnership, joint venture, trust or other enterprise
(including, without limitation, any employee benefit plan) (a "Covered
Entity"), against all expenses (including attorneys' fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred by
such person in connection with such Proceeding; provided, however, that the
foregoing shall not apply to a Director or officer of the Corporation with
respect to a Proceeding that was commenced by such Director or officer
prior to a Change in Control (as defined in Section 4.4(e)(i) of this
Article 4). Any Director or officer of the Corporation entitled to
indemnification as provided in this Section 4.1(a) is hereinafter called an
"Indemnitee". Any right of an Indemnitee to indemnification shall be a
contract right and shall include the right to receive, prior to the
conclusion of any Proceeding, payment of any expenses actually and
reasonably incurred by the Indemnitee in connection with such Proceeding,
consistent with the provisions of applicable law as then in effect and the
other provisions of this Article 4.
(b) Effect of Amendments. Neither the amendment or repeal of, nor the
adoption of a provision inconsistent with, any provision of this Article 4
(including, without limitation, this Section 4.1(b)) shall adversely affect
the rights of any Director or officer under this Article 4 (i) with respect
to any Proceeding commenced or threatened prior to such amendment, repeal
or adoption of an inconsistent provision or (ii) after the occurrence of a
Change in Control, with respect to any Proceeding arising out of any action
or omission occurring prior to such amendment, repeal or adoption of an
inconsistent provision, in either case without the written consent of such
Director or officer.
4.2 Insurance, Contracts and Funding. The Corporation may purchase
and maintain insurance to protect itself and any indemnified person against
any expenses, judgments, fines and amounts paid in settlement as specified
in Section 4.1(a) or Section 4.5 of this Article 4 or incurred by any
indemnified person in connection with any Proceeding referred to in such
Sections, to the fullest extent permitted by applicable law as then in
effect. The Corporation may enter into contracts with any Director,
officer, employee or agent of the Corporation or any director, officer,
employee, fiduciary or agent of any Covered Entity in furtherance of the
provisions of this Article 4 and may create a trust fund or use other means
(including, without limitation, a letter of credit) to ensure the payment
of such amounts as may be necessary to effect indemnification as provided
in this Article 4.
4.3 Indemnification; Not Exclusive Right. The right of
indemnification provided in this Article 4 shall not be exclusive of any
other rights to which any indemnified person may otherwise be entitled, and
the provisions of this Article 4 shall inure to the benefit of the heirs
and legal representatives of any indemnified person under this Article 4
and shall be applicable to Proceedings commenced or continuing after the
adoption of this Article 4, whether arising from acts or omissions
occurring before or after such adoption.
4.4 Advancement of Expenses; Procedures; Presumptions and Effect of
Certain Proceedings; Remedies. In furtherance, but not in limitation, of
the foregoing provisions, the following procedures,
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presumptions and remedies shall apply with respect to the advancement of
expenses and the right to indemnification under this Article 4:
(a) Advancement of Expenses. All reasonable expenses incurred by
or on behalf of the Indemnitee in connection with any Proceeding shall
be advanced to the Indemnitee by the Corporation within 20 days after
the receipt by the Corporation of a statement or statements from the
Indemnitee requesting such advance or advances from time to time,
whether prior to or after final disposition of such Proceeding. Any such
statement or statements shall reasonably evidence the expenses incurred
by the Indemnitee and shall include any written affirmation or
undertaking required by applicable law in effect at the time of such
advance.
(b) Procedures for Determination of Entitlement to
Indemnification. (i) To obtain indemnification under this Article 4, an
Indemnitee shall submit to the Secretary of the Corporation a written
request, including such documentation and information as is reasonably
available to the Indemnitee and reasonably necessary to determine
whether and to what extent the Indemnitee is entitled to indemnification
(the "Supporting Documentation"). The determination of the Indemnitee's
entitlement to indemnification shall be made not later than 60 days
after receipt by the Corporation of the written request for
indemnification together with the Supporting Documentation. The
Secretary of the Corporation shall, promptly upon receipt of such a
request for indemnification, advise the Board in writing that the
Indemnitee has requested indemnification.
(ii) The Indemnitee's entitlement to indemnification under this
Article 4 shall be determined in one of the following ways: (A) by a
majority vote of the Disinterested Directors (as hereinafter defined),
if they constitute a quorum of the Board; (B) by a written opinion of
Independent Counsel as hereinafter defined) if (x) a Change in Control
(as hereinafter defined) shall have occurred and the Indemnitee so
requests or (y) a quorum of the Board consisting of Disinterested
Directors is not obtainable or, even if obtainable, a majority of such
Disinterested Directors so directs; (C) by the stockholders of the
Corporation (but only if a majority of the Disinterested Directors, if
they constitute a quorum of the Board, presents the issue of entitlement
to indemnification to the stockholders for their determination); or (D)
as provided in Section 4.4(c) of this Article 4.
(iii) in the event the determination of entitlement to
indemnification is to be made by Independent Counsel pursuant to Section
4.4(b)(ii), a majority of the Disinterested Directors shall select the
Independent Counsel, but only an Independent Counsel to which the
Indemnitee does not reasonably object; provided, however, that if a
Change in Control shall have occurred, the Indemnitee shall select such
Independent Counsel, but only an Independent Counsel to which a majority
of the Disinterested Directors does not reasonably object.
(c) Presumptions and Effect of Certain Proceedings. Except as
otherwise expressly provided in this Article 4, if a Change in Control
shall have occurred, the Indemnitee shall be presumed to be entitled to
indemnification under this Article 4 (with respect to actions or
failures to act occurring prior to such Change in Control) upon
submission of a request for indemnification together with the Supporting
Documentation in accordance with Section 4.4(b) of this Article 4, and
thereafter the Corporation shall have the burden of proof to overcome
that presumption in reaching a contrary determination. In any event, if
the person or persons empowered under Section 4.4(b) of this Article 4
to determine entitlement to indemnification shall not have been
appointed or shall not have made a determination within 60 days after
receipt by the Corporation of the request therefor together with the
Supporting Documentation, the Indemnitee shall be deemed to be, and
shall be, entitled to indemnification unless (A) the Indemnitee
misrepresented or failed to disclose a material fact in making the
request for indemnification or in the Supporting Documentation or (B)
such indemnification is prohibited by law. The termination of any
Proceeding described in Section 4.1 of this Article 4, or of any claim,
issue or matter therein, by judgment, order, settlement or conviction,
or upon a plea of
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nolo contendere or its equivalent, shall not, of itself, adversely
affect the right of the Indemnitee to indemnification or create a
presumption that the Indemnitee did not act in good faith and in a
manner which the Indemnitee reasonably believed to be in or not opposed
to the best interests of the Corporation or, with respect to any
criminal Proceeding, that the Indemnitee had reasonable cause to believe
that his or her conduct was unlawful.
(d) Remedies of Indemnitee. (i) In the event that a determination
is made pursuant to Section 4.4(b) of this Article 4 that the Indemnitee
is not entitled to indemnification under this Article 4, (A) the
Indemnitee shall be entitled to seek an adjudication of his or her
entitlement to such indemnification either, at the Indemnitee's sole
option, in (x) an appropriate court of the state of Delaware or any
other court of competent jurisdiction or (y) an arbitration to be
conducted by a single arbitrator pursuant to the rules of the American
Arbitration Association; (B) any such judicial proceeding or arbitration
shall be de novo and the Indemnitee shall not be prejudiced by reason of
such adverse determination; and (C) if a Change in Control shall have
occurred, in any such judicial proceeding or arbitration the Corporation
shall have the burden of proving that the Indemnitee is not entitled to
indemnification under this Article 4 (with respect to actions or
failures to act occurring prior to such Change in Control).
(ii) If a determination shall have been made or deemed to have been
made, pursuant to Section 4.4(b) or (c) of this Article 4, that the
Indemnitee is entitled to indemnification, the Corporation shall be
obligated to pay the amounts constituting such indemnification within
five days after such determination has been made or deemed to have been
made and shall be conclusively bound by such determination unless (A)
the Indemnitee misrepresented or failed to disclose a material fact in
making the request for indemnification or in the Supporting
Documentation or (B) such indemnification is prohibited by law. In the
event that (x) advancement of expenses is not timely made pursuant to
Section 4.4(a) of this Article 4 or (y) payment of indemnification is
not made within five days after a determination of entitlement to
indemnification has been made or deemed to have been made pursuant to
Section 4.4(b) or (c) of this Article 4, the Indemnitee shall be
entitled to seek judicial enforcement of the Corporation's obligation to
pay to the Indemnitee such advancement of expenses or indemnification.
Not-withstanding the foregoing, the Corporation may bring an action, in
an appropriate court in the state of Delaware or any other court of
competent jurisdiction, contesting the right of the Indemnitee to
receive indemnification hereunder due to the occurrence of an event
described in Subclause (A) or (B) of this Clause (ii) (a "Disqualifying
Event"); provided, however, that in any such action the Corporation
shall have the burden of proving the occurrence of such Disqualifying
Event.
(iii) The Corporation shall be precluded from asserting in any
judicial proceeding or arbitration commenced pursuant to this Section
4.4(d) that the procedures and presumptions of this Article 4 are not
valid, binding and enforceable and shall stipulate in any such court or
before any such arbitrator that the Corporation is bound by all the
provisions of this Article 4.
(iv) In the event that the Indemnitee, pursuant to this Section
4.4(d), seeks a judicial adjudication of or an award in arbitration to
enforce his or her rights under, or to recover damages for breach of,
this Article 4, the Indemnitee shall be entitled to recover from the
Corporation, and shall be indemnified by the Corporation against, any
expenses actually and reasonably incurred by the Indemnitee if the
Indemnitee prevails in such judicial adjudication or arbitration. If it
shall be determined in such judicial adjudication or arbitration that
the Indemnitee is entitled to receive part but not all of the
indemnification or advancement of expenses sought, the expenses incurred
by the Indemnitee in connection with such judicial adjudication or
arbitration shall be prorated accordingly.
(e) Definitions. For purposes of this Article 4:
(i) "Change in Control" means a change in control of the
Corporation of a nature that would be required to be reported in
response to Item 6(e) (or any successor provision) of
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Schedule 14A of Regulation 14A (or any amendment or successor
provision thereto) promulgated under the Securities Exchange Act of
1934 (the "Act"), whether or not the Corporation is then subject to
such reporting requirement; provided that, without limitation, such a
change in control shall be deemed to have occurred if (A) any
"person" (as such term is used in Sections 13(d) and 14(d) of the
Act) is or becomes the "beneficial owner" (as defined in Rule 13d-3
under the Act), directly or indirectly, of securities of the
Corporation representing 20% or more of the voting power of all
outstanding shares of stock of the Corporation entitled to vote
generally in an election of Directors without the prior approval of
at least two-thirds of the members of the Board in office immediately
prior to such acquisition; (B) the Corporation is a party to any
merger or consolidation in which the Corporation is not the
continuing or surviving corporation or pursuant to which shares of
the Corporation's common stock would be converted into cash,
securities or other property, other than a merger of the Corporation
in which the holders of the Corporation's common stock immediately
prior to the merger have the same proportionate ownership of common
stock of the surviving corporation immediately after the merger, (C)
there is a sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all, or
substantially all, the assets of the Corporation, or liquidation or
dissolution of the Corporation; (D) the Corporation is a party to a
merger, consolidation, sale of assets or other reorganization, or a
proxy contest, as a consequence of which members of the Board in
office immediately prior to such transaction or event constitute less
than a majority of the Board thereafter; or (E) during any period of
two consecutive years, individuals who at the beginning of such
period constituted the Board (including for this purpose any new
Director whose election or nomination for election by the
stockholders was approved by a vote of at least two-thirds of the
Directors then still in office who were Directors at the beginning of
such period) cease for any reason to constitute at least a majority
of the Board.
(ii) "Disinterested Director" means a Director who is not or was
not a party to the proceeding in respect of which indemnification is
sought by the Indemnitee.
(iii) "Independent Counsel" means a law firm or a member of a
law firm that neither presently is, nor in the past five years has
been, retained to represent: (a) the Corporation or the Indemnitee in
any matter material to either such party or (b) any other party to
the Proceeding giving rise to a claim for indemnification under this
Article 4. Notwithstanding the foregoing, the term "Independent
Counsel" shall not include any person who, under applicable standards
of professional conduct, would have a conflict of interest in
representing either the Corporation or the Indemnitee in an action to
determine the Indemnitee's rights under this Article 4.
4.5 Indemnification of Employees and Agents. Notwithstanding any
other provision of this Article 4, the Corporation, to the fullest extent
permitted by applicable law as then in effect, may indemnify any person
other than a Director or officer of the Corporation who is or was an
employee or agent of the Corporation and who is or was involved in any
manner (including, without limitation, as a party or a witness) or is
threatened to be made so involved in any threatened, pending or completed
Proceeding by reasons of the fact that such person is or was an employee or
agent of the Corporation or, at the request of the Corporation, a director,
officer, employee, fiduciary or agent of a Covered Entity against all
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by such person in connection
with such Proceeding. The Corporation may also advance expenses incurred by
such employee, fiduciary or agent in connection with any such Proceeding,
consistent with the provisions of applicable law as then in effect.
4.6 Severability. If any of this Article 4 shall be held to be
invalid, illegal or unenforceable for any reason whatsoever: (i) the
validity, legality and enforceability of the remaining provisions of this
Article 4 (including, without limitation, all portions of any Section of
this Article 4 containing any such provision held to be invalid, illegal or
unenforceable, that are not themselves invalid, illegal or unenforceable)
shall not in any way be affected or impaired thereby; and (ii) to the
fullest extent
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possible, the provisions of this Article 4 (including, without limitation,
all portions of any Section of this Article 4 containing any such provision
held to be invalid, illegal or unenforceable, that are not themselves
invalid, illegal or unenforceable) shall be construed so as to give effect
to the intent manifested by the provision held invalid, illegal or
unenforceable.
Section 102(b)(7) of the Delaware General Corporation Law, as amended,
provides in regard to the limitation of liability of directors and officers as
follows:
(b) In addition to the matters required to be set forth in the
certificate of incorporation by subsection (a) of this section, the
certificate of incorporation may also contain any or all of the following
matters:
* * * *
(7) A provision eliminating or limiting the personal liability of a
director to the corporation or its stockholders for monetary damages for breach
of fiduciary duty as a director, provided that such provision shall not
eliminate or limit the liability of a director (i) for any breach of the
director's duty of loyalty to the corporation or its stockholders, (ii) for acts
or omissions not in good faith or which involve intentional misconduct of a
knowing violation of law, (iii) under section 174 of this Title, or (iv) for any
transaction from which the director derived an improper personal benefit. No
such provision shall eliminate or limit the liability of a director for any act
or omission occurring prior to the date when such provision becomes effective.
All references in this paragraph to a director shall also be deemed to refer (x)
to a member of the governing body of a corporation which is not authorized to
issue capital stock, and (y) to such other person or persons, if any, who,
pursuant to a provision of the certificate of incorporation in accordance with
subsection (a) of sec. 141 of this title, exercise or perform any of the powers
or duties otherwise conferred or imposed upon the board of directors by this
title.
Article SIXTH of The Hartford Financial Services Group, Inc. Restated
Certificate of Incorporation provides in regard to the limitation of liability
of directors and officers as follows:
To the fullest extent permitted by applicable law as then in effect,
no director or officer shall be personally liable to the Corporation or any
of its stockholders for damages for breach of fiduciary duty as a director
or officer, except for liability (a) for any breach of the director's duty
of loyalty to the Corporation or its stockholders, (b) for acts or
omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (c) under Section 174 of the Delaware General
Corporation Law, (d) for any transaction from which the director derived an
improper personal benefit or (e) for any act or omission occurring prior to
the effective date of this ARTICLE SIXTH. Any repeal or modification of
this ARTICLE SIXTH by the stockholders of the Corporation shall not
adversely affect any right or protection of a director or officer of the
Corporation existing at the time of such repeal or modification with
respect to acts or omissions occurring prior to such repeal or
modification.
The Hartford Financial Services Group, Inc., as Depositor, has agreed
to indemnify the Issuer Trustees for, and to hold the Issuer Trustees
harmless against, any loss, damage, claims, liability, penalty or expense
incurred without negligence or bad faith on the part of any Issuer Trustee,
arising out of or in connection with the acceptance or administration of
the Trust Agreement, including the costs and expenses of any Issuer Trustee
of defending itself against any claim or liability in connection with the
exercise and performance of any of its powers or duties under the Trust
Agreement.
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ITEM 16. EXHIBITS.
EXHIBIT
NO. DESCRIPTION
- ------- -----------
1.01 Proposed form of Underwriting Agreement (Equity).*
1.02 Proposed form of Underwriting Agreement (Debt) (incorporated
herein by reference to Exhibit 1.02 to the Registration
Statement on Form S-3 (No. 333-12617) of The Hartford
Financial Services Group, Inc., Hartford Capital II,
Hartford Capital III and Hartford Capital IV.
1.03 Proposed form of Underwriting Agreement (Preferred
Securities) (incorporated herein by reference to Exhibit
1.03 to the Registration Statement on Form S-3 (No.
333-12617) of The Hartford Financial Services Group, Inc.,
Hartford Capital II, Hartford Capital III and Hartford
Capital IV).
1.04 Proposed form of Underwriting Agreement (Stock Purchase
Contracts) (incorporated herein by reference to Exhibit 1.04
to the Registration Statement on Form S-3 (No. 333-12617) of
The Hartford Financial Services Group, Inc., Hartford
Capital II, Hartford Capital III and Hartford Capital IV).
4.01 Amended and Restated Certificate of Incorporation of The
Hartford Financial Services Group, Inc. ("The Hartford"),
amended effective May 21, 1998 (incorporated herein by
reference to Exhibit 3.01 to The Hartford's Form 10-Q for
the quarterly period ended June 30, 1998).
4.02 Amended By-Laws of The Hartford, amended effective February
18, 1999, (incorporated by reference to Exhibit 3.02 to The
Hartford's Form 10-K for the fiscal year ended December 31,
1998).
4.03 Senior Indenture, dated as of October 20, 1995, between ITT
Hartford and The Chase Manhattan Bank (National Association)
as Trustee (incorporated herein by reference to Exhibit 4.03
the Registration Statement on Form S-3 (Registration No.
33-98014) of ITT Hartford, Hartford Capital I, Hartford
Capital II, Hartford Capital III and Hartford Capital IV).
4.04 Form of Subordinated Indenture (incorporated herein by
reference to Exhibit 4.04 to the Registration Statement on
Form S-3 (No. 333-12617) of The Hartford, Hartford Capital
II, Hartford Capital III and Hartford Capital IV).
4.05 Junior Subordinated Indenture, dated as of February 28,
1996, between ITT Hartford and Wilmington Trust Company, as
Debenture Trustee (incorporated herein by reference to
Exhibit 4.09 to ITT Hartford's Annual Report on Form 10-K
for the year ended December 31, 1995).
4.06 Certificate of Trust of Hartford Capital III (incorporated
herein by reference to Exhibit 4.13 to the Registration
Statement on Form S-3 (Registration No. 33-98014) of ITT
Hartford, Hartford Capital I, Hartford Capital II, Hartford
Capital III and Hartford Capital IV).
4.07 Trust Agreement of Hartford Capital III (incorporated herein
by reference to Exhibit 4.14 to the Registration Statement
on Form S-3 (Registration No. 33-98014) of ITT Hartford,
Hartford Capital I, Hartford Capital II, Hartford Capital
III and Hartford Capital IV).
4.08 Certificate of Trust of Hartford Capital IV (incorporated
herein by reference to Exhibit 4.15 to the Registration
Statement on Form S-3 (Registration No. 33-98014) of ITT
Hartford, Hartford Capital I, Hartford Capital II, Hartford
Capital III and Hartford Capital IV).
4.09 Trust Agreement of Hartford Capital IV (incorporated herein
by reference to Exhibit 4.16 to the Registration Statement
on Form S-3 (Registration No. 33-98014) of ITT Hartford,
Hartford Capital I, Hartford Capital II, Hartford Capital
III and Hartford Capital IV).
4.10 Certificate of Trust of Hartford Capital V.(+)
4.11 Trust Agreement of Hartford Capital V.(+)
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EXHIBIT
NO. DESCRIPTION
- ------- -----------
4.12 Form of Amended and Restated Trust Agreement for Hartford
Capital III (incorporated herein by reference to Exhibit
4.15 to the Registration Statement on Form S-3 (Registration
No. 333-12617) of The Hartford, Hartford Capital II,
Hartford Capital III and Hartford Capital IV).
4.13 Form of Preferred Security Certificate for Hartford Capital
III (included as Exhibit E of Exhibit 4.12).
4.14 Form of Guarantee Agreement in respect of Hartford Capital
III (incorporated herein by reference to Exhibit 4.17 to the
Registration Statement on Form S-3 (Registration No.
333-12617) of The Hartford, Hartford Capital II, Hartford
Capital III and Hartford Capital IV).
4.15 Form of Amended and Restated Trust Agreement for Hartford
Capital IV (incorporated herein by reference to Exhibit 4.18
to the Registration Statement on Form S-3 (Registration No.
333-12617) of The Hartford, Hartford Capital II, Hartford
Capital III and Hartford Capital IV).
4.16 Form of Preferred Security Certificate for Hartford Capital
IV (included as Exhibit E of Exhibit 4.15).
4.17 Form of Guarantee Agreement in respect of Hartford Capital
IV (incorporated herein by reference to Exhibit 4.20 to the
Registration Statement on Form S-3 (Registration No.
333-12617) of The Hartford, Hartford Capital II, Hartford
Capital III and Hartford Capital IV).
4.18 Form of Amended and Restated Trust Agreement for Hartford
Capital V.(+)
4.19 Form of Preferred Security Certificate for Hartford Capital
V (included as Exhibit E of Exhibit 4.18).
4.20 Form of Guarantee Agreement in respect of Hartford Capital
V.(+)
4.21 Form of Depositary Receipt.*
4.22 Form of Depositary Agreement.*
4.23 Rights Agreement, dated as of November 1, 1995, between ITT
Hartford and The Bank of New York, as Rights Agent
(incorporated herein by reference to Exhibit 4.02 to The
Hartford's Form 10-K for the fiscal year ended December 31,
1995).
4.24 Form of Certificate of Voting Powers, Preferences and
Relative, Participating, Optional and Other Special Rights
and Qualifications, Limitations or Restrictions of Series A
Participating Cumulative Preferred Stock of The Hartford
(attached as Exhibit A to the Rights Agreement filed as
Exhibit 4.23 hereto).
4.25 Form of Right Certificate (attached as Exhibit B to the
Rights Agreement filed as Exhibit 4.23 hereto).
4.26 Form(s) of Warrant Agreement(s), including form of Warrant.*
4.27 Specimen Common Share Certificate (incorporated herein by
reference to Exhibit 4.1 to The Hartford's Registration
Statement on Form 8-A, dated September 18, 1995, as amended
by the Form 8-A/A, filed on November 15, 1995).
4.28 Form of Purchase Contract Agreement.*
4.29 Form of Pledge Agreement.*
4.30 Supplemental Indenture No. 1, dated as of December 27, 2000,
to the Senior Indenture filed as Exhibit 4.03 hereto,
between The Hartford Financial Services Group, Inc. and The
Chase Manhattan Bank, as Trustee.(+)
5.01 Opinion of Michael S. Wilder.(+)
5.02 Opinion of Richards, Layton & Finger, special Delaware
counsel, relating to the legality of the Preferred
Securities of Hartford Capital III.(+)
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74
EXHIBIT
NO. DESCRIPTION
- ------- -----------
5.03 Opinion of Richards, Layton & Finger, special Delaware
counsel, relating to the legality of the Preferred
Securities of Hartford Capital IV.(+)
5.04 Opinion of Richards, Layton & Finger, special Delaware
counsel, relating to the legality of the Preferred
Securities of Hartford Capital V.(+)
12.01 Statement Re: Computation of Ratio of Earnings to Fixed
Charges and Earnings to Combined Fixed Charges and Preferred
Stock Dividends.(+)
23.01 Consent of Arthur Andersen LLP.
23.02 Consent of Michael S. Wilder (included in Exhibit 5.01
hereto).
23.03 Consent of Richards, Layton & Finger, special Delaware
counsel (included in Exhibits 5.02, 5.03 and 5.04 hereto).
24.01 Powers of Attorney of certain officers and directors of The
Hartford.(+)
25.01 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of Wilmington Trust Company, as
Trustee for the Junior Subordinated Indenture (incorporated
herein by reference to Exhibit 25.01 to The Hartford's
Registration on Form S-3 (Registration No. 333-12617)).
25.02 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of Wilmington Trust Company, as
Property Trustee for the Amended and Restated Trust
Agreement of Hartford Capital Trust III (incorporated herein
by reference to Exhibit 25.04 to The Hartford's Registration
Statement on Form S-3 (Registration No. 333-12617)).
25.03 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of Wilmington Trust Company, as
Guarantee Trustee for the Guarantee for Hartford Capital
Trust III (incorporated herein by reference to Exhibit 25.07
to the Registration Statement on Form S-3 (Registration No.
33-98014) of The Hartford, Hartford Capital I, Hartford
Capital II, Hartford Capital III and Hartford Capital IV,
filed on February 7, 1996).
25.04 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of Wilmington Trust Company, as
Property Trustee for the Amended and Restated Trust
Agreement of Hartford Capital Trust IV (incorporated by
reference from Exhibit 25.04 to The Hartford's Registration
Statement on Form S-3 (Registration No. 333-12617)).
25.05 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of Wilmington Trust Company, as
Guarantee Trustee for the Guarantee for Hartford Capital
Trust IV (incorporated herein by reference to Exhibit 25.09
to the Registration Statement on Form S-3 (Registration
No.33-98014) of ITT Hartford, Hartford Capital I, Hartford
Capital II, Hartford Capital III and Hartford Capital IV).
25.06 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of Wilmington Trust Company, as
Property Trustee for the Amended and Restated Trust
Agreement of Hartford Capital Trust V.(+)
25.07 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of Wilmington Trust Company, as
Guarantee Trustee for the Guarantee for Hartford Capital
Trust V.(+)
25.08 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of The Chase Manhattan Bank (National
Association), as Trustee for the Senior Debt securities
(incorporated herein by reference to Exhibit 25.01 to ITT
Hartford's Registration Statement on Form S-3 (Registration
No. 33-98014)).
25.09 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of the Subordinated Trustee, as
Trustee for the Subordinated Debt Securities.*
- ---------------
(+) Previously filed.
* To be filed by amendment or by a report on Form 8-K pursuant to Item 601 of
Regulation S-K.
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75
ITEM 17. UNDERTAKINGS.
(a) Rule 415 Offering.
Each undersigned registrant hereby undertakes:
(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. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement;
(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 paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed with
or furnished to the Commission by such registrant pursuant to section 13 or
section 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) Filings Incorporating Subsequent Exchange Act Documents by Reference.
Each undersigned registrant hereby undertakes that, for purpose of
determining any liability under the Securities Act of 1933, each filing of such
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to 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) Acceleration of Effectiveness.
Insofar as indemnifications for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrants pursuant to the foregoing provisions, 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 Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by a registrant of expenses
incurred or paid by a director, officer or controlling person, if any, of such
registrant in the successful defense of any action, suit or proceeding) is
asserted by such director,
II-11
76
officer or controlling person in connection with the securities being
registered, such registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
(d) Rule 430A Offering.
Each undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) of
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus 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.
(e) Equity Offerings of nonreporting registrants.
Each undersigned registrant hereby undertakes to provide to the underwriter
at the closing specified in the underwriting agreements certificates in such
denominations and registered in such names as required by the underwriter to
permit prompt delivery to each purchaser.
(f) Qualification of Trust Indentures for Delayed Offerings.
Each undersigned registrant hereby undertakes to file an application for
the purpose of determining eligibility of the trustee to act under subsection
(a) of section 310 of the Trust Indenture Act ("Act") in accordance with the
rules and regulations prescribed by the Commission under section 305(b)(2) of
the Act.
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77
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, The Hartford
Financial Services Group, Inc. (i) certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3 and (ii)
has duly caused this Amendment No. 2 to the Registration Statement on Form S-3
and Post-Effective Amendment No. 3 to the Registration Statement on Form S-3
(No. 333-12617) to be signed on its behalf by the undersigned, thereunto duly
authorized, in Hartford, Connecticut, on this 23rd day of January, 2001.
THE HARTFORD FINANCIAL SERVICES GROUP,
INC.
By: /s/ C.M. O'HALLORAN
------------------------------------
C.M. O'Halloran
Senior Vice President and
Director of Corporate Law
Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 2 to the Registration Statement on Form S-3 and Post-Effective Amendment No.
3 to the Registration Statement on Form S-3 (No. 333-12617) has been signed by
the following persons in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
* Chairman, President, Chief Executive January 23, 2001
- ----------------------------------------------------- Officer and Director
Ramani Ayer (Principal Executive Officer)
* Vice Chairman and Director January 23, 2001
- -----------------------------------------------------
Lowndes A. Smith
* Executive Vice President, Chief January 23, 2001
- ----------------------------------------------------- Financial Officer and Director
David K. Zwiener (Principal Financial Officer)
* Senior Vice President and Controller January 23, 2001
- ----------------------------------------------------- (Principal Accounting Officer)
John N. Giamalis
* Director January 23, 2001
- -----------------------------------------------------
Bette B. Anderson
* Director January 23, 2001
- -----------------------------------------------------
Rand V. Araskog
* Director January 23, 2001
- -----------------------------------------------------
Dina Dublon
* Director January 23, 2001
- -----------------------------------------------------
Donald R. Frahm
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SIGNATURE TITLE DATE
--------- ----- ----
* Director January 23, 2001
- -----------------------------------------------------
Paul G. Kirk, Jr.
* Director January 23, 2001
- -----------------------------------------------------
Robert W. Selander
* Director January 23, 2001
- -----------------------------------------------------
H. Patrick Swygert
* Director January 23, 2001
- -----------------------------------------------------
Gordon I. Ulmer
*By: /s/ C.M. O'HALLORAN
- -----------------------------------------------------
C.M. O'Halloran
as Attorney-in-Fact
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79
SIGNATURE
Pursuant to the requirements of the Securities Act of 1933, Hartford
Capital III (i) certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and (ii) has duly caused
this Amendment No. 2 to the Registration Statement on Form S-3 and
Post-Effective Amendment No. 3 to the Registration Statement on Form S-3 (No.
333-12617) to be signed on its behalf by the undersigned, thereunto duly
authorized, in Hartford, Connecticut, on this 23rd day of January, 2001.
HARTFORD CAPITAL III
By THE HARTFORD FINANCIAL SERVICES
GROUP, INC., as Depositor
By /s/ C.M. O'HALLORAN
------------------------------------
C.M. O'Halloran
Senior Vice President and
Director of Corporate Law
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SIGNATURE
Pursuant to the requirements of the Securities Act of 1933, Hartford
Capital IV (i) certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and (ii) has duly caused this
Amendment No. 2 to the Registration Statement on Form S-3 and Post Effective
Amendment No. 3 to the Registration Statement on Form S-3 (No. 333-12617) to be
signed on its behalf by the undersigned, thereunto duly authorized, in Hartford,
Connecticut, on this 23rd day of January, 2001.
HARTFORD CAPITAL IV
By THE HARTFORD FINANCIAL SERVICES
GROUP, INC., as Depositor
By /s/ C.M. O'HALLORAN
------------------------------------
C.M. O'Halloran
Senior Vice President and
Director of Corporate Law
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81
SIGNATURE
Pursuant to the requirements of the Securities Act of 1933, Hartford
Capital V (i) certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and (ii) has duly caused this
Amendment No. 2 to the Registration Statement on Form S-3 and Post-Effective
Amendment No. 3 to the Registration Statement on Form S-3 (No. 333-12517) to be
signed on its behalf by the undersigned, thereunto duly authorized, in Hartford,
Connecticut, on this 23rd day of January, 2001.
HARTFORD CAPITAL V
By THE HARTFORD FINANCIAL SERVICES
GROUP, INC., as Depositor
By /s/ C.M. O'HALLORAN
------------------------------------
C.M. O'Halloran
Senior Vice President and
Director of Corporate Law
II-17