CAPITAL SECURITIES EXCHANGE AND
REGISTRATION RIGHTS AGREEMENT
CAPITAL SECURITIES EXCHANGE AND REGISTRATION RIGHTS AGREEMENT, dated as of
January 13, 1997, by and among Aon Capital A, a Delaware business trust (the
"Trust"), Aon Corporation, a Delaware corporation ("Aon"), and Morgan Stanley &
Co. Incorporated and Goldman, Sachs & Co. (collectively, the "Purchasers") of
the 8.205% Capital Securities of the Trust.
1. Certain Definitions. For purposes of this Capital Securities Exchange
and Registration Rights Agreement, the following terms shall have the following
respective meanings:
(a) "Commission" means the Securities and Exchange Commission, or any other
federal agency at the time administering the Exchange Act or the Securities Act,
whichever is the relevant statute for the particular purpose.
(b) "Debenture Exchange and Registration Rights Agreement" means the
Debenture Exchange and Registration Rights Agreement in respect of the
Debentures dated as of January 13, 1997 among Aon, the Trust and the Purchasers.
(c) "Debentures" means the 8.205% Junior Subordinated Deferrable Interest
Debentures due January 1, 2027 of Aon, to be issued pursuant to the Indenture.
(d) "Effective Time", in the case of (i) an Exchange Offer, means the date
on which the Commission declares the Exchange Offer registration statement
effective or on which such registration statement otherwise becomes effective
and (ii) a Shelf Registration, means the date on which the Commission declares
the Shelf Registration effective or on which the Shelf Registration otherwise
becomes effective.
(e) "Exchange Act" means the Securities Exchange Act of 1934, or any
successor thereto, as amended from time to time.
(f) "Exchange Debentures" has the meaning set forth in Section 2(a) hereof.
(g) "Exchange Guarantee" has the meaning set forth in Section 2(a) hereof.
(h) "Exchange Offer" has the meaning set forth in Section 2(a) hereof.
(i) "Exchange Registration" has the meaning set forth in Section 3(c)
hereof.
(j) "Exchange Securities" has the meaning set forth in Section 2(a) hereof.
(k) "Guarantee" means the Guarantee of Aon with respect to the Securities,
to the extent set forth in the Guarantee Agreement.
(l) "Guarantee Agreement" means the Capital Securities Guarantee Agreement
dated as of January 13, 1997 between Aon and The Bank of New York, as Guarantee
Trustee (together with its successors and assigns, "Guarantee Trustee"), for the
benefit of the holders of the Securities.
(m) "Guarantee Exchange and Registration Rights Agreement" means the
Guarantee Exchange and Registration Rights Agreement in respect of the Guarantee
dated as of January 13, 1997 among Aon, the Trust and the Purchasers.
(n) The term "holder" means each of the Purchasers for so long as it owns
any Registrable Securities, and its respective successors and assigns who
acquire Registrable Securities from time to time, directly or indirectly, from
such person or from any successor or assign of such person, in each case for so
long as such person owns any Registrable Securities.
(o) "Indemnified Person" has the meaning set forth in Section 6(a) hereof.
(p) "Indenture" means the Indenture dated as of January 13, 1997, between
Aon and The Bank of New York, as Debenture Trustee, as supplemented by the First
Supplemental Indenture dated as of January 13, 1997, and as further amended or
supplemented from time to time.
(q) "Issue Date" means January 13, 1997.
(r) "Liquidation Amount" means the stated liquidation preference of the
Securities.
(s) "New Guarantee Agreement" has the meaning set forth in the Guarantee
Exchange and Registration Rights Agreement.
(t) The term "person" means any individual, corporation, estate,
partnership, joint venture, association, joint stock company, limited liability
company, trust, unincorporated association or government or any agency or
political subdivision thereof, or any other entity of whatever nature.
(u) "Purchase Agreement" means the Purchase Agreement dated January 8,
1997, among Aon, the Trust and the Purchasers.
(v) "Registrable Securities" means the Securities; provided, however, that
such Securities shall cease to be Registrable Securities when
(i) the Exchange Offer is conducted as contemplated in Section 2(a);
provided that, prior to the consummation of the Exchange Offer, existing
Commission interpretations have not been changed such that the Exchange
Securities received by holders in the Exchange Offer for Registrable
Securities are not or would not be, upon receipt, transferable by each such
holder (other than a Restricted Holder) without restriction under the
Securities Act in the circumstances contemplated by Section 2(a); and
provided further, that any Exchange Security received by a broker-dealer in
an Exchange Offer exchange for a Registrable Security that was not acquired
by the broker-dealer directly from the Trust will also be a Registrable
Security through and including the earlier of the 90th day after the
Exchange Offer is completed or such time as such broker-dealer no longer
owns such Security; and provided further, however, that any such Securities
that, pursuant to the last two sentences of Section 2(a) hereof, are
included in a prospectus for use in connection with resales by broker-
dealers shall be deemed to
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be Registrable Securities with respect to Sections 5, 6 and 9 until resale
of such Exchange Securities has been effected within the 90-day period
referred to in Section 2(a) hereof;
(ii) in the circumstances contemplated by Section 2(b), a
registration statement registering such Securities (and, in the
circumstances contemplated by Section 2(b), other than a registration
statement filed in addition to the Exchange Offer, also registering the
underlying Debentures and the related Guarantee) under the Securities Act
has been declared or becomes effective and such Securities have been sold
or otherwise transferred by the holder thereof pursuant to such effective
registration statement;
(iii) such Securities are sold pursuant to Rule 144 (or any successor
provision) promulgated under the Securities Act under circumstances in
which any legend borne by such Securities relating to restrictions on
transferability thereof, under the Securities Act, is removed by the Trust
or pursuant to the Trust Agreement or such Securities are eligible to be
sold pursuant to paragraph (k) of Rule 144; or
(iv) such Securities shall cease to be outstanding.
(w) "Registration Default" has the meaning set forth in Section 2(c)
hereof.
(x) "Registration Expenses" has the meaning set forth in Section 4 hereof.
(y) "Restricted Holder" means (i) a holder that is an affiliate of the
Trust or of Aon within the meaning of Rule 405 under the Securities Act, (ii) a
holder who acquires Exchange Securities outside the ordinary course of such
holder's business, (iii) a holder who has arrangements or understandings with
any person to participate in the Exchange Offer for the purpose of distributing
Exchange Securities or (iv) a broker-dealer who receives Securities for its own
account but did not acquire the Securities as a result of market-making
activities or other trading activities.
(z) "Resale Period" has the meaning set forth in Section 2(a) hereof.
(aa) "Securities" means, collectively, the $800,000,000 aggregate
Liquidation Amount of the 8.205% Capital Securities, Liquidation Amount $1,000
per Capital Security, of the Trust to be issued and sold to the Purchasers, and
any securities issued in exchange therefor or in lieu thereof pursuant to the
Trust Agreement.
(bb) "Securities Act" means the Securities Act of 1933, or any successor
thereto, as amended from time to time.
(cc) "Shelf Registration" has the meaning set forth in Section 2(b) hereof.
(dd) "Special Distributions" has the meaning set forth in Section 2(c)
hereof.
(ee) "Special Interest" has the meaning set forth in Section 2(c) hereof.
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(ff) "Trust Agreement" means the Amended and Restated Trust Agreement
dated as of January 13, 1997 among Aon, as Depositor, The Bank of New York, as
Property Trustee, The Bank of New York (Delaware), as Delaware Trustee, the
Administrative Trustees named therein and the holders, from time to time, of
undivided beneficial interests in the assets of the Trust.
(gg) "Trust Indenture Act" means the Trust Indenture Act of 1939, or any
successor thereto, and the rules, regulations and forms promulgated thereunder,
as amended from time to time.
Unless the context otherwise requires, any reference herein to a "Section"
or "clause" refers to a Section or clause, as the case may be, of this Capital
Securities Exchange and Registration Rights Agreement, and the words "herein,"
"hereof" and "hereunder" and other words of similar import refer to this Capital
Securities Exchange and Registration Rights Agreement as a whole and not to any
particular Section or other subdivision.
2. Registration Under the Securities Act.
(a) Except as set forth in Section 2(b) below, Aon and the Trust agree,
jointly and severally, to use their reasonable best efforts to file under the
Securities Act, as soon as practicable, but no later than 150 days after the
Issue Date, a registration statement relating to an offer to exchange (the
"Exchange Offer") any and all of the Securities for a like aggregate Liquidation
Amount of capital securities of the Trust which are substantially identical to
the Securities (and which are entitled to the benefits of the Trust Agreement
which will be qualified under the Trust Indenture Act) except that they have
been registered pursuant to an effective registration statement under the
Securities Act and such new capital securities will not contain provisions for
Special Distributions or provisions restricting transfer in the absence of
registration under the Securities Act (such new capital securities hereinafter
called "Exchange Securities") for any or all of the Registrable Securities. Such
registration statement shall also relate to, and the consummation of the
Exchange Offer shall be conditioned upon the consummation of, an offer to
exchange the Debentures for substantially identical debentures of Aon pursuant
to the Debenture Exchange and Registration Rights Agreement (the "Exchange
Debentures") and to an offer to exchange the Guarantee for a substantially
identical guarantee of Aon pursuant to the Guarantee Exchange and Registration
Rights Agreement (the "Exchange Guarantee"). Aon and the Trust agree, jointly
and severally, to use their reasonable best efforts to cause such registration
statement to become effective under the Securities Act within 180 days of the
Issue Date. The Exchange Offer will be registered under the Securities Act on
the appropriate form and will comply in all material respects with all
applicable tender offer rules and regulations under the Exchange Act. Aon and
the Trust further agree, jointly and severally, to commence the Exchange Offer
promptly after such registration statement has become effective and to hold the
Exchange Offer open for at least 30 calendar days, and the Trust agrees to issue
Exchange Securities for all Registrable Securities that have been validly
tendered and not withdrawn on or prior to the expiration of the Exchange Offer.
The Exchange Offer will be deemed to have been completed only if the Exchange
Securities received by holders other than Restricted Holders in the Exchange
Offer for Registrable Securities are, upon receipt, transferable by each such
holder without restriction under the Securities Act and the Exchange Act, it
being understood that broker-dealers receiving Exchange Securities will be
subject to certain prospectus delivery requirements with respect to resale of
the Exchange
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Securities. The Exchange Offer shall be deemed to have been completed upon the
earlier to occur of (i) the Trust having exchanged the Exchange Securities for
all outstanding Registrable Securities pursuant to the Exchange Offer and (ii)
the Trust having exchanged, pursuant to the Exchange Offer, Exchange Securities
for all Registrable Securities that have been validly tendered and not withdrawn
before the expiration of the Exchange Offer, which shall be on a date that is at
least 30 days following the commencement of the Exchange Offer. Aon and the
Trust agree, jointly and severally, (x) to include in the registration statement
a prospectus for use in connection with any resales of Exchange Securities by a
broker-dealer, other than resales of Exchange Securities received by a broker-
dealer pursuant to the Exchange Offer in exchange for Registrable Securities
acquired by the broker-dealer directly from the Trust, and (y) to the extent any
broker-dealer participates in the Exchange Offer and notifies Aon or causes Aon
to be notified in writing that it is a participating broker-dealer, to use their
reasonable efforts to keep such registration statement effective for a period
(the "Resale Period") beginning when Exchange Securities are first issued in the
Exchange Offer and ending upon the earlier of the expiration of the 90th day
after the Exchange Offer has been completed or such shorter period if all
Exchange Securities received by such broker-dealer in exchange for Registrable
Securities acquired for its own account as a result of market-making or other
trading activities have been disposed of by such broker-dealer; and no broker-
dealers shall be authorized by Aon to, and shall not, deliver such Prospectus
after such period in connection with resales contemplated by this Section 2(a)
or otherwise; it being understood that, notwithstanding anything in this Capital
Securities Exchange and Registration Rights Agreement to the contrary, Aon shall
not be required to comply with any provision of this Section 2(a) or any other
provision of this Capital Securities Exchange and Registration Rights Agreement
relating to the distribution of Exchange Securities by broker-dealers, to the
extent that Aon reasonably concludes that compliance with such provision is no
longer required by applicable law or interpretation of the Staff of the
Commission. With respect to such registration statement, each broker-dealer that
holds Exchange Securities received in the Exchange Offer in exchange for
Registrable Securities not acquired by it directly from the Trust shall have the
benefit of the rights of indemnification and contribution set forth in Section 6
hereof.
(b) If (i) on or prior to the consummation of the Exchange Offer existing
Commission interpretations are changed such that the Exchange Securities
received by holders other than Restricted Holders in the Exchange Offer for
Registrable Securities are not or would not be, upon receipt, transferable by
each such holder without restriction under the Securities Act, (ii) the Exchange
Offer has not been consummated within 210 days following the Issue Date or (iii)
the Purchasers so request (but only with respect to the Securities) within 60
days after the consummation of the Exchange Offer with respect to any Securities
held by them which are not freely transferable following consummation of the
Exchange Offer, in lieu of (or, in the case of clause (iii), in addition to)
conducting the Exchange Offer contemplated by Section 2(a), Aon and the Trust
shall file under the Securities Act, as soon as practicable, a "shelf"
registration statement providing for the registration of, and the sale on a
continuous or delayed basis by the holders of, all of the Registrable Securities
(or, in the case of clause (iii), of the Securities held by the Purchasers for
resale by the Purchasers), pursuant to Rule 415 under the Securities Act and/or
any similar rule that may be adopted by the Commission (the "Shelf
Registration"). Unless the Shelf Registration has been filed in addition to
conducting the Exchange Offer contemplated by Section 2(a), the Shelf
Registration shall also provide for the registration of the Debentures pursuant
to the Debenture Exchange and Registration Rights Agreement and for
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the registration of the Guarantee pursuant to the Guarantee Exchange and
Registration Rights Agreement. Aon and the Trust agree, jointly and severally,
to use their reasonable best efforts to cause the Shelf Registration to become
or be declared effective and to keep such Shelf Registration continuously
effective for a period ending on the earlier of (A) the third anniversary of the
Issue Date (or, in the case of clause (iii) above, the first anniversary) or (B)
the later of (i) such time as there are no longer any Registrable Securities
outstanding or (ii) as required under the Debenture Exchange and Registration
Rights Agreement. Aon and the Trust further agree, jointly and severally, to
supplement or make amendments to the Shelf Registration, as and when required by
the rules, regulations or instructions applicable to the registration form used
by Aon and the Trust for such Shelf Registration or by the Securities Act or
rules and regulations thereunder for shelf registration, and Aon and the Trust
agree, jointly and severally, to furnish to the holders of the Registrable
Securities copies of any such supplement or amendment prior to its being used
and/or filed with the Commission.
(c) In the event that (i) Aon and the Trust have not filed the registration
statement relating to the Exchange Offer (or, if applicable, the Shelf
Registration) on or before the 150th day after the Issue Date, or (ii) such
registration statement (or, if applicable, the Shelf Registration) has not
become effective or been declared effective by the Commission on or before the
180th day after the Issue Date, or (iii) any of the Exchange Offer, the exchange
offer contemplated by the Guarantee Exchange and Registration Rights Agreement
and the exchange offer contemplated by the Debenture Exchange and Registration
Rights Agreement has not been completed within 210 days after the Issue Date (if
the Exchange Offer is then required to be made) or (iv) any registration
statement required by Section 2(a) or 2(b) is filed and declared effective but
shall thereafter cease to be effective for five business days (except as
specifically permitted herein) without being succeeded by an additional
registration statement filed and declared effective (each such event referred to
in clauses (i) through (iv), a "Registration Default"), then interest will
accrue (in addition to the stated interest rate on the Debentures) at the rate
of 0.25% per annum on the principal amount of the Debentures, and the
distributions will accumulate (in addition to the stated distribution rate on
the Securities) at the rate of 0.25% per annum on the Liquidation Amount of the
Securities, for the period from the occurrence of the Registration Default until
such time as no Registration Default is in effect. Such additional interest (the
"Special Interest") and such additional distributions (the "Special
Distributions") will be payable in cash semi-annually in arrears on each January
1 and July 1 in accordance with, and subject to the deferral provisions of, the
Indenture and the Trust Agreement, respectively. Special Interest, if any, and
Special Distributions, if any, will be computed on the basis of a 365 or 366 day
year, as the case may be, and the number of days actually elapsed.
(d) Any reference herein to a registration statement shall be deemed to
include any document incorporated therein by reference as of the applicable
Effective Time and any reference herein to any post-effective amendment to a
registration statement shall be deemed to include any document incorporated
therein by reference as of a time after such Effective Time.
3. Registration Procedures.
If Aon and the Trust file a registration statement pursuant to Section 2(a)
or Section 2(b), the following provisions shall apply:
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(a) At or before the Effective Time of the Exchange Offer or the Shelf
Registration, as the case may be, Aon shall qualify the Indenture, the New
Guarantee Agreement and the Trust Agreement under the Trust Indenture Act.
(b) In the event that such qualification would require the appointment of a
new trustee under any of the Indenture, the New Guarantee Agreement or the Trust
Agreement, such new trustee shall be appointed thereunder pursuant to the
applicable provisions thereof.
(c) In connection with the joint and several obligations of Aon and the
Trust with respect to the registration of the Exchange Securities, the Exchange
Guarantee and the Exchange Debentures, as contemplated by Section 2(a) (the
"Exchange Registration"), if applicable, Aon and the Trust shall, as soon as
reasonably possible (or as otherwise specified):
(i) prepare and file with the Commission, as soon as practicable
but no later than 150 days after the Issue Date, a registration
statement with respect to the Exchange Registration on any form which
may be utilized by Aon and the Trust and which shall permit the
Exchange Offer and resales of Exchange Securities by broker-dealers
during the Resale Period to be effected as contemplated by Section
2(a) hereof, and use its reasonable best efforts to cause such
registration statement to become effective as soon as practicable
thereafter;
(ii) as soon as practicable prepare and file with the Commission
such amendments and supplements to such registration statement and the
prospectus included therein as may be necessary to effect and maintain
the effectiveness of such registration statement for the periods and
purposes contemplated in Section 2(a) hereof and as may be required by
the applicable rules and regulations of the Commission and the
instructions applicable to the form of such registration statement,
and promptly provide each broker-dealer holding Exchange Securities
with such number of copies of the prospectus included therein (as then
amended or supplemented), in conformity in all material respects with
the requirements of the Securities Act and the Trust Indenture Act and
the rules and regulations of the Commission promulgated thereunder, as
such broker-dealer reasonably may request prior to the expiration of
the Resale Period, for use in connection with resales of Exchange
Securities;
(iii) promptly notify each broker-dealer that has requested or
received copies of the prospectus included in such registration
statement, and confirm such advice in writing, (A) when such
registration statement or the prospectus included therein or any
prospectus amendment or supplement or post-effective amendment has
been filed, and, with respect to such registration statement or any
post-effective amendment, when the same has become effective, (B) of
the receipt of any comments by the Commission and by the Blue Sky or
securities commissioner or regulator of any state with respect thereto
or any request by the Commission for amendments or supplements to such
registration statement or prospectus or for additional information,
(C) of the issuance by the Commission of any
7
stop order suspending the effectiveness of such registration statement
or the initiation or threatening by the Commission of any proceedings
for that purpose, (D) if at any time the joint and several
representations and warranties of Aon and the Trust contemplated by
Section 5 cease to be true and correct in all material respects, (E)
of the receipt by either Aon or the Trust of any notification with
respect to the suspension of the qualification of the Exchange
Securities and the Exchange Guarantee for sale in any United States
jurisdiction or the initiation or, to Aon's or the Trust's knowledge,
threatening of any proceeding for such purpose, or (F) at any time
during the Resale Period when a prospectus is required to be delivered
under the Securities Act, that such registration statement,
prospectus, prospectus amendment or supplement or post-effective
amendment does not conform in all material respects to the applicable
requirements of the Securities Act and the Trust Indenture Act and the
rules and regulations of the Commission promulgated thereunder or
contains an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then
existing;
(iv) in the event that Aon and the Trust would be required,
pursuant to Section 3(c)(iii)(F) above, to notify any broker-dealers
holding Exchange Securities, without delay prepare and furnish to each
such holder a reasonable number of copies of a prospectus supplemented
or amended so that, as thereafter delivered to purchasers of such
Exchange Securities during the Resale Period, such prospectus shall
conform in all material respects to the applicable requirements of the
Securities Act and the Trust Indenture Act and the rules and
regulations of the Commission promulgated thereunder and shall not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then
existing;
(v) use their reasonable best efforts to obtain the withdrawal
of any order suspending the effectiveness of such registration
statement or any post-effective amendment thereto at the earliest
practicable date;
(vi) use their reasonable best efforts to (A) register or
qualify the Exchange Securities and the Exchange Guarantee under the
securities laws or blue sky laws of such jurisdictions as are
contemplated by Section 2(a) no later than the commencement of the
Exchange Offer, (B) keep such registrations or qualifications in
effect and comply with such laws so as to permit the continuance of
offers, sales and dealings therein in such jurisdictions until the
expiration of the Resale Period and (C) take any and all other actions
as may be reasonably necessary or advisable to enable each broker-
dealer holding Exchange Securities to consummate the disposition
thereof in such jurisdictions; provided, however, that neither Aon nor
the Trust shall be required for any such purpose to (1) qualify to do
business in any jurisdiction wherein it would not otherwise be
required to qualify but for the requirements of this Section 3(c)(vi),
(2) consent to general service
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of process in any such jurisdiction or (3) in the case of Aon, make
any changes to its charter or by-laws or any agreement between it and
its stockholders or in the case of the Trust, make any changes to the
Trust Agreement;
(vii) use their reasonable best efforts to obtain the consent or
approval of each United States governmental agency or authority,
whether federal, state or local, which may be required to effect the
Exchange Registration, the Exchange Offer and the offering and sale of
Exchange Securities by broker-dealers during the Resale Period;
(viii) provide a CUSIP number for all Exchange Securities, not
later than the applicable Effective Time; and
(ix) comply with all applicable rules and regulations of the
Commission, and make generally available to all holders of Securities
as soon as practicable but no later than eighteen months after the
Effective Time, an earnings statement of Aon and its subsidiaries
complying with Section 11 (a) of the Securities Act (including, at the
option of Aon, Rule 158 thereunder).
(d) In connection with the joint and several obligations of Aon and the
Trust with respect to the Shelf Registration, if applicable, Aon and the Trust
shall use their reasonable best efforts to cause the Shelf Registration to
become effective to permit the sale of the Registrable Securities by the holders
thereof in accordance with the intended method or methods of distribution
thereof described in the Shelf Registration. In connection therewith, Aon and
the Trust shall as soon as reasonably possible (or as otherwise specified):
(i) prepare and file with the Commission, as soon as
practicable, a registration statement with respect to the Shelf
Registration on any form which may be utilized by Aon and the Trust
and which shall permit the disposition of the Registrable Securities
in accordance with the intended method or methods thereof, as
specified in writing to Aon and the Trust by the holders of the
Registrable Securities and use their reasonable best efforts to cause
such registration statement to become effective as soon as practicable
thereafter;
(ii) as soon as practicable, prepare and file with the
Commission such amendments and supplements to such registration
statement and the prospectus included therein as may be necessary to
effect and maintain the effectiveness of such registration statement
for the period specified in Section 2(b) hereof and as may be required
by the applicable rules and regulations of the Commission and the
instructions applicable to the form of such registration statement and
furnish to the holders of the Registrable Securities copies of any
such supplement or amendment simultaneously with or prior to its being
used or filed with the Commission;
(iii) comply with the provisions of the Securities Act
applicable to Aon or the Trust in connection with the disposition of
all of the
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Registrable Securities covered by such registration statement in
accordance with the intended methods of disposition by the holders
thereof, set forth in such registration statement;
(iv) provide (A) the holders of the Registrable Securities to be
included in such registration statement and not more than one counsel
for all the holders of such Registrable Securities, (B) the
underwriters (which term, for purposes of this Capital Securities
Exchange and Registration Rights Agreement, shall include a person
deemed to be an underwriter within the meaning of Section 2(11) of the
Securities Act), if any, thereof, (C) the sales or placement agent, if
any, therefor and (D) one counsel for such underwriters or agents, if
any, reasonable opportunity to participate in the preparation of such
registration statement, each prospectus included therein or filed with
the Commission, and each amendment or supplement thereto;
(v) for a reasonable period prior to the filing of such
registration statement, and throughout the period specified in Section
2(b), make available at reasonable times at Aon's principal place of
business or such other reasonable place for inspection by the persons
referred to in Section 3(d)(iv) who shall certify to Aon and the Trust
that they have a current intention to sell the Registrable Securities
pursuant to the Shelf Registration such financial and other
information and books and records of Aon and the Trust, and cause the
officers, employees, counsel and independent certified public
accountants of Aon and the Trust to respond to such inquiries, as
shall be reasonably necessary, in the judgment of the respective
counsel referred to in such Section, to conduct a reasonable
investigation within the meaning of Section 11 of the Securities Act;
provided, however, that each such party shall be required to maintain
in confidence and not to disclose to any other person any information
or records reasonably designated by Aon as being confidential, until
such time as (A) such information becomes a matter of public record
(whether by virtue of its inclusion in such registration statement or
otherwise, except by disclosure by such party in breach of this
Agreement), or (B) such person shall be required so to disclose such
information pursuant to the subpoena or order of any court or other
governmental agency or body having jurisdiction over the matter
(subject to, and only to the extent required by, the requirements of
such order, and only after such person shall have given Aon prompt
prior written notice of such requirement);
(vi) promptly notify the selling holders of Registrable
Securities, the sales or placement agent, if any, therefor and the
managing underwriter or underwriters, if any, thereof and confirm such
advice in writing, (A) when such registration statement or the
prospectus included therein or any prospectus amendment or supplement
or post-effective amendment has been filed, and, with respect to such
registration statement or any post-effective amendment, when the same
has become effective, (B) of any comments by the Commission and by the
Blue Sky or securities commissioner or regulator of any state with
respect thereto or any request
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by the Commission for amendments or supplements to such registration
statement or prospectus or for additional information, (C) of the
issuance by the Commission of any stop order suspending the
effectiveness of such registration statement or the initiation or
threatening by the Commission of any proceedings for that purpose, (D)
if at any time the joint and several representations and warranties of
Aon and the Trust contemplated by Section 3(d)(xv)(A) or Section 5
cease to be true and correct in all material respects, (E) of the
receipt by either Aon or the Trust of any notification with respect to
the suspension of the qualification of the Registrable Securities and
the Guarantee for sale in any jurisdiction or, to Aon's or the Trust's
knowledge, the initiation or threatening of any proceeding for such
purpose, or (F) at any time when a prospectus is required to be
delivered under the Securities Act, that such registration statement,
prospectus, prospectus amendment or supplement or post-effective
amendment, or any document incorporated by reference in any of the
foregoing, does not conform in all material respects to the applicable
requirements of the Securities Act and the Trust Indenture Act and the
rules and regulations of the Commission promulgated thereunder or
contains an untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then
existing;
(vii) use their best efforts to obtain the withdrawal of any
order suspending the effectiveness of such registration statement or
any post-effective amendment thereto at the earliest practicable date;
(viii) if requested by any managing underwriter or underwriters,
any placement or sales agent or any holder or counsel for the holders
of Registrable Securities, promptly incorporate in a prospectus
supplement or post-effective amendment such information as is required
by the applicable rules and regulations of the Commission and as such
managing underwriter or underwriters, such agent or such holder
specifies should be included therein relating to the terms of the sale
of such Registrable Securities, including, without limitation,
information with respect to the Liquidation Amount or the principal
amount, as the case may be, of Registrable Securities being sold by
any holder or agent or to any underwriters, the name and description
of such holder, agent or underwriter, the offering price of such
Registrable Securities and any discount, commission or other
compensation payable in respect thereof, the purchase price being paid
therefor by such underwriters and with respect to any other terms of
the offering of the Registrable Securities, to be sold by such holder
or agent or to such underwriters; and make all required filings of
such prospectus supplement or post-effective amendment promptly after
notification of the matters to be incorporated in such prospectus
supplement or post-effective amendment;
(ix) furnish to each holder of Registrable Securities, each
placement or sales agent, if any, therefor, each underwriter, if any,
thereof and the respective counsel referred to in Section 3(d)(iv) an
executed copy
11
of such registration statement, each such amendment and supplement
thereto (in each case including all exhibits thereto and documents
incorporated by reference therein) and such number of copies of such
registration statement (excluding exhibits thereto and documents
incorporated by reference therein unless specifically so requested by
such holder, agent or underwriter, as the case may be) and of the
prospectus included in such registration statement (including each
preliminary prospectus and any summary prospectus), in conformity with
the requirements of the Securities Act and the Trust Indenture Act and
the rules and regulations of the Commission promulgated thereunder,
and such other documents, as such holder, agent, if any, and
underwriter, if any, may reasonably request in order to facilitate the
offering and disposition of the Registrable Securities owned by such
holder, offered or sold by such agent or underwritten by such
underwriter and to permit such holder, agent and underwriter to
satisfy the prospectus delivery requirements of the Securities Act;
and each of Aon and the Trust hereby consents to the use of such
prospectus (including such preliminary and summary prospectus) and any
amendment or supplement thereto by each such holder and by any such
agent and underwriter, in each case in the form most recently provided
to such party by Aon and the Trust, in connection with the offering
and sale of the Registrable Securities covered by the prospectus
(including such preliminary and summary prospectus) or any supplement
or amendment thereto;
(x) use their reasonable best efforts to (A) register or qualify
the Registrable Securities to be included in such registration
statement and the Guarantee under such securities laws or blue sky
laws of such jurisdictions as any holder of such Registrable
Securities and each placement or sales agent, if any, therefor and
underwriter, if any, thereof shall reasonably request, (B) keep such
registrations or qualifications in effect and comply with such laws so
as to permit the continuance of offers, sales and dealings therein in
such jurisdictions during the period the Shelf Registration is
required to remain effective under Section 2(b) above and for so long
as may be necessary to enable any such holder, agent or underwriter to
complete its distribution of Securities pursuant to such registration
statement and (C) take any and all other actions as may be reasonably
necessary or advisable to enable each such holder, agent, if any, and
underwriter, if any, to consummate the disposition in such
jurisdictions of Registrable Securities; provided, however, that
neither Aon nor the Trust shall be required for any such purpose to
(1) qualify to do business in any jurisdiction wherein it would not
otherwise be required to qualify but for the requirements of this
Section 3(d)(x), (2) consent to general service of process in any such
jurisdiction, (3) in the case of Aon, make any changes to its charter
or by-laws or any agreement between it and its shareholders or, in the
case of the Trust, make any changes to the Trust Agreement;
(xi) use their reasonable best efforts to obtain the consent or
approval of each governmental agency or authority, whether federal,
state or local, which may be required to effect the Shelf Registration
or the
12
offering or sale in connection therewith or to enable the selling
holder or holders to offer, or to consummate the disposition of, their
Registrable Securities;
(xii) cooperate with the holders of the Registrable Securities
and the managing underwriters, if any, to facilitate the timely
preparation and delivery of certificates representing Registrable
Securities to be sold, which certificates shall be printed,
lithographed or engraved, or produced by any combination of such
methods, and which shall not bear any restrictive legends; and, in the
case of an underwritten offering, enable such Registrable Securities
to be in such denominations and registered in such names as the
managing underwriters may request at least two business days prior to
any sale of the Registrable Securities;
(xiii) provide a CUSIP number for all Registrable Securities,
not later than the applicable Effective Time;
(xiv) enter into not more than one underwriting agreement,
engagement letter, agency agreement, "best efforts" underwriting
agreement or similar agreement, as appropriate, including (without
limitation) provisions relating to indemnification and contribution
substantially the same as those set forth in Section 6 hereof, and
take such other actions in connection therewith as any holders of
Registrable Securities aggregating at least 25% in aggregate
Liquidation Amount, or in aggregate principal amount, as the case may
be, of the Registrable Securities at the time outstanding shall
reasonably request in order to expedite or facilitate the disposition
of such Registrable Securities; provided, that Aon and the Trust shall
not be required to (i) enter into any such agreement more than once
with respect to all of the Registrable Securities and may delay
entering into such agreement until the consummation of any
underwritten public offering which Aon and the Trust shall have then
undertaken or (ii) enter into any engagement letter, agency agreement,
"best effort" underwriting agreement or similar agreement whatsoever
with respect to the Registrable Securities, and provided further, that
Aon and the Trust shall not be obligated to enter into any such
agreement with a broker-dealer which results in the need for a
"qualified independent underwriter" (within the meaning of the Rules
of Fair Practice and the By-Laws of the National Association of
Securities Dealers, Inc. ("NASD") or any successor thereto, as amended
from time to time (the "Rules and By-Laws of NASD"));
(xv) whether or not an agreement of the type referred to in
Section (3)(d)(xiv) hereof is entered into and whether or not any
portion of the offering contemplated by such registration statement is
an underwritten offering or is made through a placement or sales agent
or any other entity, (A) make such representations and warranties to
the holders of such Registrable Securities and the placement or sales
agent, if any, therefor and the underwriters, if any, thereof
substantially the same as those set forth in Section 1 of the Purchase
Agreement and such other representations and warranties as are
customarily made with respect to the offering of debt
13
securities pursuant to any appropriate agreement or to a registration
statement on the applicable form under the Securities Act; (B) obtain
an opinion or opinions of counsel to Aon and the Trust substantially
the same as the opinions provided for in Section 5 of the Purchase
Agreement with such additions, substitutions or deletions of such
matters as are customarily covered in opinions for an underwritten
offering, addressed to such holder or holders and the placement or
sales agent, if any, therefor and the underwriters, if any, thereof
and dated the effective date of such registration statement (and if
such registration statement contemplates an underwritten offering of a
part or all of the Registrable Securities, dated the date of the
closing under the underwriting agreement relating thereto) (it being
agreed that the matters to be covered by such opinion shall also
include, without limitation, the absence of governmental approvals
required to be obtained in connection with the Shelf Registration, the
offering and sale of the Registrable Securities, this Capital
Securities Exchange and Registration Rights Agreement or any agreement
of the type referred to in Section (3)(d)(xiv) hereof, except such
approvals as may be required under state securities or blue sky laws;
and the compliance in all material respects as to form of such
registration statement and any documents incorporated by reference
therein and of the Indenture, the Guarantee Agreement and the Trust
Agreement with the requirements of the Securities Act and the Trust
Indenture Act and the rules and regulations of the Commission
promulgated thereunder, respectively); and, such opinion shall also
state that such counsel has no reason to believe that, as of the date
of the opinion and of the registration statement or most recent post-
effective amendment thereto, as the case may be, such registration
statement and the prospectus included therein, as then amended or
supplemented, and the documents incorporated by reference therein (in
each case other than the financial statements and other financial
information contained therein) contains or contained an untrue
statement of a material fact or omits or omitted to state therein a
material fact necessary to make the statements therein not misleading
(in the case of such documents, in the light of the circumstances
existing at the time that such documents were filed with the
Commission under the Exchange Act)); (C) obtain a "cold comfort"
letter or letters from the independent certified public accountants of
Aon and the Trust addressed to the selling holders of Registrable
Securities, the placement or sales agent, if any, therefor and the
underwriters, if any, thereof, dated (i) the effective date of such
registration statement and (ii) the effective date of any prospectus
supplement to the prospectus included in such registration statement;
(D) deliver such other documents and certificates, including officers'
certificates, as may be reasonably requested by any holders of at
least 25% in aggregate Liquidation Amount, or in aggregate principal
amount, as the case may be, of the Registrable Securities at the time
outstanding or the placement or sales agent, if any, therefor and the
managing underwriters, if any, thereof to evidence the accuracy of the
representations and warranties made pursuant to clause (A) above or
those contained in Section 5(a) hereof and the compliance with or
satisfaction of any agreements or conditions contained in the
underwriting agreement or other agreement entered into by Aon and the
Trust; and (E) undertake such
14
obligations relating to expense reimbursement, indemnification and
contribution as are provided in Section 6 hereof;
(xvi) notify in writing each holder of Registrable Securities of
any proposal by Aon and the Trust to amend or waive any provision of
this Capital Securities Exchange and Registration Rights Agreement
pursuant to Section 9(h) hereof and of any amendment or waiver
effected pursuant thereto, each of which notices shall contain the
text of the amendment or waiver proposed or effected, as the case may
be;
(xvii) in the event that any broker-dealer registered under the
Exchange Act shall underwrite any Registrable Securities or
participate as a member of an underwriting syndicate or selling group
or "assist in the distribution" (within the meaning of the Rules and
By-Laws of NASD) thereof, whether as a holder of such Registrable
Securities or as an underwriter, a placement or sales agent or a
broker or dealer in respect thereof, or otherwise, assist such broker-
dealer in complying with the requirements of such Rules and By-Laws,
including, without limitation, by (A) if such Rules or By-Laws,
including Schedule E thereto (or any successor thereto), shall so
require, engaging a "qualified independent underwriter" (as defined in
such Schedule (or any successor thereto)) to participate in the
preparation of the registration statement relating to such Registrable
Securities, to exercise usual standards of due diligence in respect
thereto and, if any portion of the offering contemplated by such
registration statement is an underwritten offering or is made through
a placement or sales agent, to recommend the yield of such Registrable
Securities, (B) indemnifying any such qualified independent
underwriter to the extent of the indemnification of underwriters
provided in Section 6 hereof (or to such other customary extent as may
be required by such underwriter), and (C) providing such information
to such broker-dealer as may be required in order for such broker-
dealer to comply with the requirements of the Rules and By-Laws of
NASD; and
(xviii) comply with all applicable rules and regulations of the
Commission, and make generally available to its holders of the
Securities as soon as practicable but in any event not later than
eighteen months after the effective date of such registration
statement, an earnings statement of Aon and its subsidiaries complying
with Section 11(a) of the Securities Act (including, at the option of
Aon, Rule 158 thereunder).
(e) In the event that Aon and the Trust would be required, pursuant to
Section 3(d)(vi)(F) above, to notify the selling holders of Registrable
Securities, the placement or sales agent, if any, therefor and the managing
underwriters, if any, thereof, Aon and the Trust shall without delay prepare and
furnish to each such holder, to each placement or sales agent, if any, and to
each underwriter, if any, a reasonable number of copies of a prospectus
supplemented or amended so that, as thereafter delivered to purchasers of
Registrable Securities, such prospectus shall conform in all material respects
to the applicable requirements of the Securities Act and the Trust Indenture Act
and the rules and regulations of the Commission promulgated thereunder and shall
not contain an untrue statement of a
15
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing. Each broker-dealer holding Exchange Securities and
each holder of Registrable Securities agrees that upon receipt of any notice
from Aon and the Trust pursuant to Section 3(c)(iii)(F) or 3(d)(vi)(F) hereof,
as the case may be, such holder shall forthwith discontinue the disposition of
Exchange Securities or Registrable Securities, as the case may be, pursuant to
the registration statement applicable to such Exchange Securities or Registrable
Securities, as the case may be, until such holder shall have received copies of
such amended or supplemented prospectus, and if so directed by Aon and the
Trust, such holder shall deliver to Aon (at Aon's expense) all copies, other
than permanent file copies, then in such holder's possession of the prospectus
covering such Exchange Securities or Registrable Securities, as the case may be,
at the time of receipt of such notice.
(f) Aon and the Trust may require each holder of Registrable Securities as
to which any registration is being effected to furnish in writing to Aon and the
Trust such information regarding such holder and such holder's intended method
of distribution of such Registrable Securities as Aon and the Trust may from
time to time reasonably request in writing, but only to the extent that such
information is required in order to comply with the Securities Act. Each such
holder agrees to notify Aon and the Trust as promptly as practicable of any
inaccuracy or change in information previously furnished by such holder to Aon
and the Trust or of the occurrence of any event in either case as a result of
which any prospectus relating to such registration contains or would contain an
untrue statement of a material fact regarding such holder or such holder's
intended method of distribution of such Registrable Securities or omits to state
any material fact regarding such holder or such holder's intended method of
distribution of such Registrable Securities required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing, and promptly to furnish to Aon and the Trust any
additional information required to correct and update any previously furnished
information or required so that such prospectus shall not contain, with respect
to such holder or the distribution of such Registrable Securities, an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading in
light of the circumstances then existing. Each such holder shall comply with the
provisions of the Securities Act applicable to such holder with respect to the
disposition by such holder of Registrable Securities covered by such
registration statement in accordance with the intended methods of disposition by
such holder set forth in such registration statement.
(g) Until the expiration three years after the Issue Date, Aon will not,
and will not permit any of its "affiliates" (as defined in Rule 144 under the
Securities Act) to, resell any of the Securities which constitute "restricted
securities" under Rule 144 that have been reacquired by any of them except
pursuant to an effective registration statement under the Securities Act or any
exemption therefrom; provided, however, that, for purposes of this paragraph,
"affiliates" shall not include the Purchasers or any of their affiliates other
than Aon and its subsidiaries, officers, managers and directors.
(h) If Aon and the Trust file with the Commission a registration statement
in respect of the Exchange Offer pursuant to Section 2(a), then Aon and the
Trust shall also file with the Commission a registration statement under Section
12 of the Exchange Act and the rules and regulations promulgated thereunder
related to the Exchange Securities (and the Securities and the Registrable
Securities, if any). Aon and the Trust shall use their
16
reasonable best efforts to cause such registration statement to become effective
prior to the 120th day of the fiscal year of the Trust next succeeding the
fiscal year in which the Exchange Offer has been consummated.
(i) Aon and the Trust may require each holder of Registrable Securities as
to which a registration statement is being effected pursuant to Section 2(a), as
a condition to such holder's eligibility to exchange the Registrable Securities
for the Exchange Securities, that such holder furnish to Aon and the Trust (or
an agent thereof) in writing information as to the number of "beneficial owners"
(within the meaning of Rule 13d-3 under the Exchange Act) on behalf of whom such
holder holds the Registrable Securities that such holder desires to exchange for
the Exchange Securities.
4. Registration Expenses.
If Aon and the Trust file a registration statement pursuant to Section 2(a)
or Section 2(b), the following provisions shall apply:
Aon agrees to bear and to pay or cause to be paid promptly upon request
being made therefor all expenses incident to the performance by Aon and the
Trust or compliance with this Capital Securities Exchange and Registration
Rights Agreement, including, without limitation, (a) all Commission and any NASD
registration and filing fees and expenses, (b) all fees and expenses in
connection with the qualification of the Securities and the Guarantee for
offering and sale under the state securities and blue sky laws referred to in
Section 3(d)(x) hereof, including reasonable fees and disbursements of counsel
in connection with such qualifications, (c) all expenses relating to the
preparation, printing, distribution and reproduction of each registration
statement required to be filed hereunder, each prospectus included therein or
prepared for distribution pursuant hereto, each amendment or supplement to the
foregoing, and the certificates representing the Securities and all documents
relating hereto, (d) messenger and delivery expenses, (e) fees and expenses of
the Debenture Trustee under the Indenture, the Issuer Trustees under the Trust
Agreement and the Guarantee Trustee under the Guarantee Agreement and of any
escrow agent or custodian, (f) internal expenses (including, without limitation,
all salaries and expenses of Aon's officers and employees performing legal or
accounting duties), (g) fees, disbursements and expenses of counsel and
independent certified public accountants of Aon and the Trust (including the
expenses of any opinions or "cold comfort" letters required by or incident to
such performance and compliance), (h) fees, disbursements and expenses of any
"qualified independent underwriter" engaged pursuant to Section 3(d)(xvii)
hereof, (i) fees, disbursements and expenses of one counsel for the holders of
Registrable Securities retained in connection with a Shelf Registration, as
selected by the holders of at least a majority in aggregate Liquidation Amount,
or the aggregate principal amount, as the case may be, of the Registrable
Securities being registered, and fees, expenses and disbursements of any other
persons, including special experts, retained by Aon or the Trust in connection
with such registration (collectively, the "Registration Expenses"). To the
extent that any Registration Expenses are incurred, assumed or paid by any
holder of Registrable Securities or any placement or sales agent therefor or
underwriter thereof, Aon shall reimburse such person for the full amount of the
Registration Expenses so incurred, assumed or paid promptly after receipt of a
written request therefor. Notwithstanding the foregoing, the holders of the
Registrable Securities being registered shall pay all agency or brokerage fees
and commissions and underwriting discounts and commissions attributable to the
sale of
17
such Registrable Securities and the fees and disbursements of any counsel or
other advisors or experts retained by such holders (severally or jointly), other
than the counsel and experts specifically referred to above, transfer taxes on
resale of any of the Securities by such holders and any advertising or
solicitation expenses other than expenses specifically referred to above
incurred by or on behalf of such holders in connection with any offers they may
make.
5. Representations and Warranties.
Aon and the Trust, jointly and severally, represent and warrant to, and
agree with, each Purchaser and each of the holders from time to time of
Registrable Securities that:
(a) Each registration statement covering Registrable Securities, the
Guarantee, if applicable, and the Debentures and each prospectus (including any
preliminary or summary prospectus) contained therein or furnished pursuant to
Section 3(d)(ix) hereof and any further amendments or supplements to any such
registration statement or prospectus, when it becomes effective or is filed with
the Commission, as the case may be, and, in the case of an underwritten offering
of Registrable Securities, at the time of the closing under the underwriting
agreement relating thereto, will conform in all material respects to the
applicable requirements of the Securities Act and the Trust Indenture Act, the
rules and regulations of the Commission promulgated thereunder and any such
registration statement and any amendment thereto will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading and
any such prospectus or any amendment or supplement thereto will not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading in
light of the circumstances then existing; and at all times subsequent to the
Effective Time of any such registration statement when a prospectus would be
required to be delivered under the Securities Act, other than from (i) such time
as a notice has been given to holders of Registrable Securities pursuant to
Section 3(c)(iii)(F) or Section 3(d)(vi)(F) hereof until (ii) such time as Aon
and the Trust furnish an amended or supplemented prospectus pursuant to Section
3(c)(iv) or Section 3(e) hereof, as the case may be, each such registration
statement, and each prospectus (including any summary prospectus) contained
therein or furnished pursuant to Section 3(c) or Section 3(d)(ix) hereof, as
then amended or supplemented, will conform in all material respects to the
applicable requirements of the Securities Act and the Trust Indenture Act and
the rules and regulations of the Commission promulgated thereunder and will not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing; provided, however,
that this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information furnished in
writing to Aon and the Trust by a holder of Registrable Securities or any
placement or sales agent therefor or underwriter thereof expressly for use
therein.
(b) Any documents incorporated by reference in any prospectus referred to
in Section 5(a) hereof, when they become or became effective or are or were
filed with the Commission, as the case may be, will conform or conformed in all
material respects to the requirements of the Securities Act or the Exchange Act,
as applicable, and none of such documents will contain or contained an untrue
statement of a material fact or will omit or
18
omitted to state a material fact required to be stated therein or necessary to
make the statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or omissions made
in reliance upon and in conformity with information furnished in writing to Aon
and the Trust by a holder of Registrable Securities expressly for use therein.
(c) The representations and warranties of the Trust and Aon contained in
Section 1 of the Purchase Agreement are true and correct with the same force and
effect as though expressly made at and as of the date hereof.
6. Indemnification.
(a) Upon the registration of the Registrable Securities pursuant to Section
2 hereof, and in consideration of the agreements of the Purchasers contained
herein, and as an inducement to the Purchasers to purchase the Securities, the
Trust and Aon, jointly and severally, agree to indemnify and hold harmless each
of the holders of Registrable Securities to be included in such registration,
and each person who participates as a placement or sales agent or as an
underwriter in any offering or sale of such Registrable Securities and each
person, if any, who controls such holder, or such placement or sales agent, if
any, or such underwriter, if any, within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act (each an "Indemnified Person") as follows:
(i) against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably
incurred in connection with defending or investigating any such action
or claim) caused by any untrue statement or alleged untrue statement
of a material fact contained in any registration statement under which
such Registrable Securities were registered under the Securities Act,
or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading or caused by any untrue statement or
alleged untrue statement of a material fact contained in any
preliminary, final or summary prospectus (or any amendment or
supplement thereto) contained in such registration statement or caused
by any omission or alleged omission to state therein a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except
insofar as such losses, claims, damages or liabilities are caused by
any such untrue statement or omission that was made in reliance upon
and in conformity with written information relating to such
Indemnified Person furnished to the Trust and Aon by, or on behalf of,
such Indemnified Person expressly for use in such registration
statement or such preliminary, final or summary prospectus (or any
amendment or supplement thereto);
(ii) against any and all losses, claims, damages and liabilities
whatsoever to the extent of the aggregate amount paid in settlement of
any litigation, or investigation or proceeding by any governmental
agency or body, commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or any such alleged
untrue statement or omission (except as made in reliance upon and in
conformity with
19
information relating to such Indemnified Person furnished by, or on
behalf of, such Indemnified Person as aforesaid), if such settlement
is effected with the written consent of the Trust and Aon; and
(iii) against any and all expense whatsoever (including the fees
and disbursements of counsel chosen by such Indemnified Person),
reasonably incurred in investigating, preparing or defending against
any litigation, or investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue
statement or omission (except as made in reliance upon and in
conformity with information relating to such Indemnified Person
furnished by, or on behalf of, such Indemnified Person as aforesaid)
to the extent that any such expense is not paid under (i) or (ii)
above.
provided, however, that indemnification with respect to any prospectus shall not
inure to the benefit of any holder of Registrable Securities or Exchange
Securities from whom the Person asserting any loss, claim, damage, liability or
expense purchased such Securities, if a copy of the prospectus (as then amended
or supplemented and furnished by Aon to such holder) was not sent or given by or
on behalf of such holder to such person if such is required by law at or prior
to the sale of such Registrable Securities or Exchange Securities, as the case
may be, and if the prospectus (as so amended and supplemented) would have cured
the defect giving rise to such loss, claim, damage, liability or expense.
(b) Aon may require, as a condition to including any Registrable Securities
in any registration statement filed pursuant to Section 2 hereof and to entering
into any placement or underwriting agreement with respect thereto, that Aon
shall have received an undertaking reasonably satisfactory to them from the
holder of such Registrable Securities and from each placement agent or
underwriter named in any such placement agreement or underwriting agreement,
severally and not jointly, to indemnify and hold harmless the Trust and Aon and
each person, if any, who controls the Trust or Aon within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act against any and all
loss, claim, damage, liability and expense described in the indemnity contained
in subsection (a) of this Section, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in any registration
statement under which such Registrable Securities were registered under the
Securities Act, or any preliminary, final or summary prospectus contained
therein as furnished by the Trust or Aon to any such holder, agent or
underwriter (or any amendment or supplement thereto), in reliance upon and in
conformity with written information relating to such holder, or such placement
or sales agent, if any, or such underwriter, if any, furnished to the Trust and
Aon by or on behalf of such holder, or such placement or sales agent, if any, or
such underwriter, if any, expressly for use in such registration statement or
such preliminary, final or summary prospectus (or any amendment or supplement
thereto).
(c) Each indemnified party shall give prompt notice to each indemnifying
party of any action commenced against it in respect of which indemnity may be
sought hereunder but failure to so notify an indemnifying party shall not
relieve it from any liability which it may have otherwise than on account of
this indemnity agreement. An indemnifying party may participate at its own
expense in the defense of such action. In no event shall the
20
indemnifying parties be liable for the fees and expenses of more than one
counsel (in addition to any local counsel) for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances;
provided, however, that when more than one of such holders, such placement or
sales agents, if any, or such underwriters, if any, is an indemnified party,
each such holder, placement or sales agent or such underwriter, as the case may
be, shall be entitled to separate counsel (in addition to any local counsel) in
each such jurisdiction to the extent such holder, placement or sales agent or
such underwriter, as the case may be, may have interests conflicting with those
of the other holder, placement or sales agent or such underwriter, as the case
may be. No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened proceeding
in respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party, unless
such settlement includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such proceeding.
In order to provide for just and equitable contribution in circumstances in
which the indemnity agreement provided for in this Section 6 is for any reason
held to be unavailable to such holders, such placement or sales agents, if any,
or such underwriters, if any, in accordance with its terms, the Trust, Aon and
such holders, such placement and sales agents, if any, and such underwriters, if
any, shall contribute to the aggregate losses, liabilities, claims, damages and
expenses of the nature contemplated by said indemnity agreement incurred by the
Trust, Aon and such holders, such placement and sales agents, if any, and such
underwriters, if any, in such proportions as is appropriate to reflect the
relative benefits received by the Trust and Aon on the one hand and such
holders, such placement and sales agents, if any, and such underwriters, if any,
on the other. The relative benefits received by the Trust and Aon on the one
hand and such holders, such placement and sales agents, if any, and such
underwriters, if any, on the other shall be deemed to be in such proportion
represented by the percentage that the total commissions and underwriting
discounts received by such holders, such placement and sales agents, if any, and
such underwriters, if any, to the date of such liability bears to the total
sales price (before deducting expenses) received by the Trust and such holders,
such placement and sales agents, if any, and such underwriters, if any, from the
sale of such Securities made to the date of such liability, and the Trust and
Aon are jointly and severally responsible for the balance. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law or if such holders, such placement and sales agents, if any, and
such underwriters, if any, failed to give the notice required under this
subsection (c), then the Trust, Aon and such holders, such placement and sales
agents, if any, and such underwriters, if any, shall contribute to such
aggregate losses, liabilities, claims, damages and expenses in such proportion
as is appropriate to reflect not only such relative benefits but also the
relative fault of the Trust and Aon on the one hand and such holders, such
placement and sales agents, if any, and such underwriters, if any, on the other
in connection with the statements or omissions which resulted in such
liabilities, claims, damages and expenses, as well as any other relevant
equitable considerations. The relative fault shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Trust and Aon on the one hand or is
supplied by, or on behalf of, such holders, such placement or sales agents, if
any, and such underwriters, if any, on the other and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such
21
statement or omission. The Trust, Aon and such holders, such placement or sales
agents, if any, and such underwriters, if any, agree that it would not be just
and equitable if contributions pursuant to this paragraph were determined pro
rata (even if such holders, such placement or sales agents, if any, and such
underwriters, if any, were treated as one entity for such purpose) or by any
other method of allocation which does not take account of the equitable
considerations referred to in this paragraph. Notwithstanding the provisions of
this paragraph, such holders, such placement or sales agents, if any, and such
underwriters, if any, shall not be required to contribute any amount in excess
of the amount by which the total price at which the Securities referred to in
the second sentence of this paragraph that were offered and sold to the public
through such holders, such placement or sales agents, if any, and such
underwriters, if any, exceeds the amount of any damages that such holders, such
placement or sales agents, if any, and such underwriters, if any, have otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled
under this paragraph to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section, each person, if
any, who controls any such holders, such placement or sales agents, if any, and
such underwriters, if any, within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act shall have the same rights to contribution
as such holders, such placement or sales agents, if any, and such underwriters,
if any, and each person, if any, who controls the Trust or Aon within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act
shall have the same rights to contribution as the Trust or Aon.
7. Underwritten Offerings.
(a) Selection of Underwriters. If any of the Registrable Securities covered
by the Shelf Registration are to be sold pursuant to an underwritten offering,
the managing underwriter or underwriters thereof shall be designated by the
holders of at least a majority in aggregate Liquidation Amount of the
Registrable Securities to be included in such offering, provided that such
designated managing underwriter or underwriters is or are reasonably acceptable
to the Trust and Aon.
(b) Participation by Holders. Each holder of Registrable Securities hereby
agrees with each other such holder that no such holder may participate in any
underwritten offering hereunder unless such holder (i) agrees to sell such
holder's Registrable Securities on the basis provided in any underwriting
arrangements approved by the persons entitled hereunder to approve such
arrangements and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements.
(c) Consolidated Earnings Statements. In the event of an underwritten
offering, Aon agrees to make generally available to holders of Securities as
soon as practicable, but in any event not later than eighteen months after the
effective date of the applicable registration statement (as defined in Rule
158(c) under the Securities Act), a consolidated earnings statement of Aon
(which need not be audited) complying with Section 11 (a) of the Securities Act
and the rules and regulations of the Commission thereunder (including, at the
option of Aon, Rule 158 under the Securities Act)
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8. Rule 144.
Aon covenants to the holders of Registrable Securities that to the extent
it shall be required to do so under the Exchange Act, Aon shall timely file the
reports required to be filed by it under the Exchange Act or the Securities Act
(including, but not limited to, the reports under Sections 13 and 15(d) of the
Exchange Act referred to in subparagraph (c)(1) of Rule 144 adopted by the
Commission under the Securities Act) and the rules and regulations adopted by
the Commission thereunder, and shall take such further action as any holder of
Registrable Securities may reasonably request, all to the extent required from
time to time to make Rule 144 available to such holder for the sale of
Registrable Securities without registration under the Securities Act within the
limitations of the exemption provided by Rule 144 under the Securities Act, as
such Rule may be amended from time to time, or any similar or successor rule or
regulation hereafter adopted by the Commission. Upon the request of any holder
of Registrable Securities in connection with that holder's sale pursuant to Rule
144, Aon shall deliver to such holder a written statement as to whether it has
complied with such requirements.
9. Miscellaneous.
(a) No Inconsistent Agreements. Each of the Trust and Aon represents,
warrants, covenants and agrees that it has not granted, and shall not grant,
registration rights with respect to Registrable Securities or any other
securities which would be inconsistent with the terms contained in this Capital
Securities Exchange and Registration Rights Agreement and that the Debenture
Exchange and Registration Rights Agreement and the Guarantee Exchange and
Registration Rights Agreement should be construed to be consistent with the
terms hereof.
(b) Specific Performance. The parties hereto acknowledge that there would
be no adequate remedy at law if any party fails to perform any of its
obligations hereunder and that each party may be irreparably harmed by any such
failure and accordingly agree that each party, in addition to any other remedy
to which it may be entitled at law or in equity, shall be entitled to compel
specific performance of the obligations of any other party under this Capital
Securities Exchange and Registration Rights Agreement in accordance with the
terms and conditions of this Capital Securities Exchange and Registration Rights
Agreement, in any court of the United States or any State thereof having
jurisdiction.
(c) Notices. All notices, requests, claims, demands, waivers and other
communications hereunder shall be in writing and shall be deemed to have been
duly given when delivered by hand, if delivered personally or by courier, or
three days after being deposited in the mail (registered or certified mail,
postage prepaid, return receipt requested) as follows: if to the Trust or to
Aon, then to Aon Corporation, 123 North Wacker Drive, Chicago, Illinois, 60606,
Attention: Treasurer, and if to a holder, to the address of such holder set
forth in the security register or other records of the Trust, or to such other
address as any party may have furnished to the others in writing in accordance
herewith, except that notices of change of address shall be effective only upon
receipt.
(d) Parties in Interest. All the terms and provisions of this Capital
Securities Exchange and Registration Rights Agreement shall be binding upon,
shall inure to the benefit of and shall be enforceable by the respective
successors and assigns of the parties
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hereto. In the event that any transferee of any holder of Registrable Securities
shall become a holder of Registrable Securities, in any manner, whether by gift,
bequest, purchase, operation of law or otherwise, such transferee shall, without
any further writing or action of any kind, be deemed a party hereto for all
purposes and such Registrable Securities shall be held subject to all of the
terms of this Capital Securities Exchange and Registration Rights Agreement, and
by taking and holding such Registrable Securities such transferee shall be
entitled to receive the benefits of and be conclusively deemed to have agreed to
be bound by and to perform all of the terms and provisions of this Capital
Securities Exchange and Registration Rights Agreement. If Aon shall so request,
any such successor, assign or transferee shall agree in writing to acquire and
hold the Registrable Securities subject to all of the terms hereof.
(e) Survival. The respective indemnities, agreements, representations,
warranties and each other provision set forth in this Capital Securities
Exchange and Registration Rights Agreement or made pursuant hereto shall remain
in full force and effect regardless of any investigation (or statement as to the
results thereof) made by or on behalf of any holder of Registrable Securities,
any director, officer or partner of such holder, any agent or underwriter or any
director, officer or partner thereof, or any controlling person of any of the
foregoing, and shall survive delivery of and payment for the Registrable
Securities pursuant to the Purchase Agreement and the transfer and registration
of Registrable Securities by such holder and the consummation of an Exchange
Offer. In addition, the respective indemnities, representations and warranties
set forth herein shall survive the termination hereof.
(f) LAW GOVERNING. THIS CAPITAL SECURITIES EXCHANGE AND REGISTRATION RIGHTS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.
(g) Headings. The descriptive headings of the several Sections and
paragraphs of this Capital Securities Exchange and Registration Rights Agreement
are inserted for convenience only, do not constitute a part of this Capital
Securities Exchange and Registration Rights Agreement and shall not affect in
any way the meaning or interpretation of this Capital Securities Exchange and
Registration Rights Agreement.
(h) Entire Agreement; Amendments. This Capital Securities Exchange and
Registration Rights Agreement and the other agreements referred to herein or
delivered pursuant hereto which form a part hereof contain the entire
understanding of the parties with respect to its subject matter. This Capital
Securities Exchange and Registration Rights Agreement and such other agreements
referred to herein supersede all prior agreements and understandings between the
parties with respect to its subject matter. This Capital Securities Exchange and
Registration Rights Agreement may be amended and the observance of any term of
this Capital Securities Exchange and Registration Rights Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively) only by a written instrument duly executed by Aon, the Trust and
the holders of at least 66-2/3 percent in aggregate principal amount of the
Registrable Securities at the time outstanding. Each holder of any Registrable
Securities at the time or thereafter outstanding shall be bound by any amendment
or waiver effected pursuant to this Section 9(h), whether or not any notice,
writing or marking indicating such amendment or waiver appears on such
Registrable Securities or is delivered to such holder.
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(i) Inspection. For so long as this Capital Securities Exchange and
Registration Rights Agreement shall be in effect, this Capital Securities
Exchange and Registration Rights Agreement and a complete list of the names and
addresses of all the registered holders of Registrable Securities shall be made
available for inspection and copying on any business day by any holder of
Registrable Securities at the offices of Aon at the address thereof set forth in
Section 9(c) above.
(j) Counterparts. This agreement may be executed by the parties in
counterparts, each of which shall be deemed to be an original, but all such
respective counterparts shall together constitute one and the same instrument.
(k) Termination. Except for the respective indemnities, representations and
warranties set forth herein, this Capital Securities Exchange and Registration
Rights Agreement shall terminate when all the Securities, Exchange Securities
and Registrable Securities cease to be outstanding.
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This Capital Securities Exchange and Registration Rights Agreement is hereby
executed as of the day and year first above written.
AON CORPORATION
By: /s/ Harvey N. Medvin
-------------------------------------
Name: Harvey N. Medvin
Title: Executive Vice President,
Chief Financial Officer
and Treasurer
AON CAPITAL A
By: /s/ Harvey N. Medvin
--------------------------------------
Name: Harvey N. Medvin
Administrative Trustee
MORGAN STANLEY & CO. INCORPORATED
As Representative of the Purchasers named in
Schedule I to the Purchase Agreement
By: /s/ Michael Fusco
--------------------------------------
(Morgan Stanley & Co. Incorporated)
Acting severally, and not jointly and
severally, on behalf of themselves and each
of the Purchasers named in Schedule I to the
Purchase Agreement
26