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EXHIBIT 4.3.1
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SUPPLEMENTAL PURCHASE CONTRACT AGREEMENT
DATED AS OF OCTOBER 29, 1999
AMONG
THE ALLSTATE CORPORATION,
A.P.L. ACQUISITION CORPORATION,
AMERICAN HERITAGE LIFE INVESTMENT CORPORATION,
AND
BANK ONE TRUST COMPANY,
NATIONAL ASSOCIATION
AS PURCHASE CONTRACT AGENT
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
PAGE
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SECTION 1.1. DEFINITION OF TERMS...................................... 2
ARTICLE II
CONCERNING THE MERGER
SECTION 2.1. ASSUMPTION OF OBLIGATIONS................................ 2
SECTION 2.2. ALLSTATE AS A CO-OBLIGOR AND ISSUER OF COMMON
STOCK UPON SETTLEMENT.................................... 3
SECTION 2.3. ACCEPTANCE BY AGENT...................................... 3
ARTICLE III
CONCERNING SETTLEMENT
SECTION 3.1. PURCHASE CONTRACT SETTLEMENT............................. 3
SECTION 3.2. SETTLEMENT RATE.......................................... 4
SECTION 3.3. NOTICE................................................... 4
ARTICLE IV
MISCELLANEOUS
SECTION 4.1. RATIFICATION OF PURCHASE CONTRACT AGREEMENT.............. 5
SECTION 4.2. EFFECTIVENESS............................................ 5
SECTION 4.3. SECURITIES DEEMED CONFORMED.............................. 5
SECTION 4.4. GOVERNING LAW............................................ 5
SECTION 4.5. SEPARABILITY............................................. 5
SECTION 4.6. COUNTERPARTS............................................. 5
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SUPPLEMENTAL PURCHASE CONTRACT AGREEMENT, dated as of October 29, 1999 (the
"Supplemental Agreement"), among The Allstate Corporation, a Delaware
corporation ("Allstate"), A.P.L. Acquisition Corporation, a Delaware corporation
and wholly-owned subsidiary of Allstate ("Merger Sub"), American Heritage Life
Investment Corporation, a Florida corporation ("AHLIC"), and Bank One Trust
Company, National Association (successor in interest to The First National Bank
of Chicago, a national banking association), acting as purchase contract agent
for the Holders of Securities from time to time (the "Agent").
WHEREAS, AHLIC and Agent executed the purchase contract agreement dated as
of June 27, 1997 (the "Purchase Contract Agreement") to provide for the
execution and delivery of the Purchase Contracts and Certificates related to the
Income PRIDES or Growth PRIDES (collectively, the "Securities");
WHEREAS, pursuant to the Purchase Contract Agreement, AHLIC and a
wholly-owned trust issued 2,070,000 FELINE PRIDES for an aggregate purchase
price, before commissions, of $103,500,000;
WHEREAS, AHLIC intends to consummate a transaction involving the merger
(the "Merger") of AHLIC with and into Merger Sub, pursuant to the Agreement and
Plan of Merger and Reorganization among Allstate, Merger Sub and AHLIC dated as
of July 8, 1999 (the "Merger Agreement");
WHEREAS, Section 9.1 of the Purchase Contract Agreement permits AHLIC to
merge with another corporation provided certain terms and conditions are
satisfied;
WHEREAS, Section 8.1 of the Purchase Contract Agreement authorizes AHLIC
and Agent to enter into a supplemental agreement without the consent of any
Holders, to, among other things, evidence the succession of another Person to
AHLIC, make provision with respect to the rights of Holders pursuant to Section
5.6(b) of the Purchase Contract Agreement and make any change that does not
adversely affect the interests of the Holders;
WHEREAS, AHLIC has furnished the Agent with an Opinion of Counsel, stating
that the Merger and this Supplemental Agreement (together with the Purchase
Contract Agreement, the "Supplemented Purchase Contract Agreement") comply with
the Purchase Contract Agreement and that all conditions precedent in the
Purchase Contract Agreement provided for relating to the Merger have been met;
WHEREAS, pursuant to Section 8.3 of the Purchase Contract Agreement, in
signing this Supplemental Agreement the Agent shall be fully protected in
relying upon an Opinion of Counsel stating that this Supplemental Agreement is
authorized or permitted by the Purchase Contract Agreement;
WHEREAS, AHLIC has requested that Agent execute and deliver this
Supplemental Agreement, and all requirements necessary to make this Supplemental
Agreement a valid instrument in accordance with its terms, and to make the
Securities the valid obligations of Merger Sub and Allstate, have been
performed, and the execution and delivery of this Supplemental Agreement has
been duly authorized in all respects; and
WHEREAS, Merger Sub, AHLIC, Allstate, Agent and The Chase Manhattan Bank
have executed a supplemental pledge agreement, dated as of the date hereof,
whereby Merger Sub and Allstate have expressly assumed all the obligations of
AHLIC under the Pledge Agreement among AHLIC, Agent and The Chase Manhattan Bank
dated as of June 27, 1997;
NOW THEREFORE, in consideration of the premises Allstate, Merger Sub and
AHLIC covenant and agree with the Agent as follows:
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ARTICLE I
DEFINITIONS
SECTION 1.1. DEFINITION OF TERMS.
Unless the context otherwise requires:
(a) a term defined in the Purchase Contract Agreement has the same meaning
when used in this Supplemental Agreement;
(b) a term defined anywhere in this Supplemental Agreement has the same
meaning throughout;
(c) the singular includes the plural and vice versa;
(d) headings are for convenience of reference only and do not affect
interpretation;
(e) the term "Effective Time" shall have the meaning given to it in the
Merger Agreement.
ARTICLE II
CONCERNING THE MERGER
SECTION 2.1. ASSUMPTION OF OBLIGATIONS.
(a) Merger Sub hereby expressly assumes, from and after the Effective Time,
as fully as if it had been an original party to the Purchase Contract Agreement,
all the respective obligations of AHLIC under the Purchase Contracts and the
Purchase Contract Agreement.
(b) From and after the Effective Time, pursuant to Section 9.2 of the
Purchase Contract Agreement, Merger Sub hereby succeeds, is substituted for, and
shall possess and from time to time may exercise each and every right and power
of, the "Company" under the Purchase Contracts and the Purchase Contract
Agreement with the same effect as if Merger Sub had been an original party to
the Purchase Contract Agreement. As of the Effective Time, AHLIC is hereby
forever released and discharged from all liabilities, covenants or obligations
under the Purchase Contracts and the Purchase Contract Agreement.
SECTION 2.2. ALLSTATE AS A CO-OBLIGOR AND ISSUER OF COMMON STOCK UPON
SETTLEMENT.
(a) The parties hereby agree that, from and after the Effective Time,
Allstate shall hereby become a joint and several co-obligor with Merger Sub (but
not as a successor to AHLIC) under the Purchase Contracts and the Supplemented
Purchase Contract Agreement, and Allstate hereby agrees to (i) be jointly and
severally liable with Merger Sub for the obligations of Merger Sub arising under
the Purchase Contracts and the Supplemented Purchase Contract Agreement, as
fully as if Allstate had originally been an original obligor under such Purchase
Contracts and Purchase Contract Agreement and (ii) issue and deliver the number
of shares of its common stock, par value $0.01 ("Allstate Common Stock"), which
is sufficient to settle the Purchase Contracts as provided in Article III of
this Supplemental Agreement, against payment in full of the Purchase Price in
the manner set forth in the Purchase Contract Agreement and Section 2.2(b)
hereof.
(b) Merger Sub hereby agrees that it will immediately forward to Allstate
all funds received by it under Sections 5.4, 5.9 or otherwise under the Purchase
Contract Agreement for payment of the purchase price upon settlement of the
Purchase Contract for the shares of Allstate Common Stock to be so issued.
SECTION 2.3. ACCEPTANCE BY AGENT.
The Agent accepts this Supplemental Agreement and agrees to execute its
duties and responsibilities as hereby supplemented upon the terms and conditions
set forth in the Purchase Contract Agreement, including the terms and provisions
defining and limiting the liabilities and responsibilities of the Agent, which
terms and
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provisions shall in like manner define and limit its liabilities and
responsibilities in the performance of its duties created by the Purchase
Contract Agreement as hereby supplemented; and without limiting the generality
of the foregoing, the Agent shall not be responsible in any manner whatsoever
for or with respect to any of the recitals or statements contained herein, all
of which recitals or statements are made solely by Allstate, Merger Sub and
AHLIC, or for or with respect to the validity or sufficiency of this
Supplemental Agreement or any of the terms or provisions hereof.
ARTICLE III
CONCERNING SETTLEMENT
SECTION 3.1. PURCHASE CONTRACT SETTLEMENT.
(a) The parties understand and agree that, pursuant to Section 5.6(b) of
the Purchase Contract Agreement, the Merger constitutes a Reorganization Event
whereupon the Settlement Rate will be adjusted to provide that each Holder of
Securities will receive on the Purchase Contract Settlement Date with respect to
each Purchase Contract forming a part thereof, the kind and amount of
securities, cash and other property receivable upon such Reorganization Event by
a holder of the number of shares of the Company's Common Stock issuable on
account of each Purchase Contract as if the Purchase Contract Settlement Date
had occurred immediately prior to such Reorganization Event and assuming such
holder failed to exercise his rights of election as to the kind or amount of
securities, cash and other property so receivable. Because the Merger
constitutes a Reorganization Event and non-electing holders of the Company's
Common Stock will receive a certain number of shares of Allstate Common Stock,
the parties hereby agree that the Settlement Rate will be adjusted as of the
Effective Time to reflect the number of shares of Allstate Common Stock to be
delivered upon settlement of the Purchase Contract, subject to any further
adjustments in the Settlement Rate under Article V of the Purchase Contract
Agreement prior to settlement. Attached as Exhibit A hereto is an Officer's
Certificate, pursuant to Section 5.7(a)(i) of the Purchase Contract Agreement,
which sets forth the method of calculation of the Settlement Rate at the
Effective Time, as adjusted for the Merger.
(b) The parties hereby agree that, from and after the Effective Time, the
provisions of the Supplemental Purchase Contract Agreement and the Purchase
Contracts that refer to the delivery of "Common Stock" of AHLIC, including
without limitation Sections 5.4, 5.5, 5.9, 10.3 and 10.4 of the Purchase
Contract Agreement, shall relate to Allstate Common Stock by operation of
Section 5.6(b) of the Purchase Contract Agreement.
SECTION 3.2. SETTLEMENT RATE.
In accordance with the last two sentences of Section 5.6(b) of the Purchase
Contract Agreement, the Settlement Rate shall be adjusted for events subsequent
to the Effective Time, in a manner that is as nearly equivalent as may be
practicable to the adjustments provided for in Section 5.6 of the Purchase
Contract Agreement, as if Allstate was the original "Company" and Allstate
Common Stock was the original "Common Stock" under the provisions of Section
5.6.
SECTION 3.3. NOTICE.
Pursuant to Section 5.7(a)(ii) of the Purchase Contract Agreement, within
10 Business Days following the Effective Time, Merger Sub will provide written
notice to Holders of the Securities describing in reasonable detail the
adjustment to the Settlement Rate caused by the Merger.
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ARTICLE IV
MISCELLANEOUS
SECTION 4.1. RATIFICATION OF PURCHASE CONTRACT AGREEMENT.
The Purchase Contract Agreement, as supplemented by this Supplemental
Agreement, is in all respects ratified and confirmed, and this Supplemental
Agreement shall be deemed part of the Purchase Contract Agreement in the manner
and to the extent herein and therein provided.
SECTION 4.2. EFFECTIVENESS.
This Supplemental Agreement shall become a legally effective and binding
instrument upon the later of (i) execution and delivery hereof by all parties
hereto and (ii) the Effective Time.
SECTION 4.3. SECURITIES DEEMED CONFORMED.
As of the Effective Time, the provisions of each Security then outstanding
shall be deemed to be conformed, without the necessity for any reissuance or
exchange of such Security or any other action on the part of the Holders,
Allstate, Merger Sub, AHLIC or Agent, so as to reflect this Supplemental
Agreement.
SECTION 4.4. GOVERNING LAW.
This Supplemental Agreement shall be governed by and construed in
accordance with the laws (other than the choice of law provisions) of the State
of New York.
SECTION 4.5. SEPARABILITY.
In case any one or more of the provisions contained in this Supplemental
Agreement or in the Securities shall for any reason be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of this Supplemental
Agreement or of the Securities, but this Supplemental Agreement and the
Securities shall be construed as if such invalid or illegal or unenforceable
provision had never been contained herein or therein.
SECTION 4.6. COUNTERPARTS.
This Supplemental Agreement may be executed in any number of counterparts
each of which shall be an original; but such counterparts shall together
constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Agreement to be duly executed as of the day and year first above written.
AMERICAN HERITAGE LIFE INVESTMENT
CORPORATION
By: /s/ T. O'▇▇▇▇ ▇▇▇▇▇▇▇
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Name: T. O'▇▇▇▇ ▇▇▇▇▇▇▇
Title: Chairman and CEO
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THE ALLSTATE CORPORATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: Treasurer
A.P.L. ACQUISITION CORPORATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: Treasurer
BANK ONE TRUST COMPANY, NATIONAL
ASSOCIATION
as Agent
By: /s/ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
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EXHIBIT A
OFFICER'S CERTIFICATE
OF
AMERICAN HERITAGE LIFE INVESTMENT CORPORATION
UNDER SECTION 5.7(a)(i) AND SECTION 9.1 OF THE
PURCHASE CONTRACT AGREEMENT
THE UNDERSIGNED,____________, the____________of American Heritage Life
Investment Corporation, a Florida corporation (the "Company"), hereby certifies
that:
(1) Accompanying this Certificate is the duly executed Supplemental
Purchase Contract Agreement (the "Supplemental Agreement"), dated as
of October 29, 1999, among the Company, The Allstate Corporation, a
Delaware corporation ("Allstate"), A.P.L. Acquisition Corporation, a
Delaware corporation ("Merger Sub"), and Bank One Trust Company,
National Association, as purchase contract agent (the "Agent"), which
will become effective as of the Effective Time of the Merger of the
Company into Merger Sub and which amends the Purchase Contract
Agreement dated as of June 27, 1997 among such parties.
(2) Pursuant to Section 5.7(a)(i) of the Purchase Contract Agreement, the
Settlement Rate from and after the Effective Time, the method of
calculation thereof, and the facts requiring such adjustment and upon
which such adjustment is based, are as follows:
As of the Effective Time, the Company will merge with and
into Merger Sub and the Company and the Company's Common
Stock will no longer exist. Section 5.6(b) of the Purchase
Contract Agreement provides that the Merger constitutes a
Reorganization Event whereupon the Settlement Rate will be
adjusted to provide that each Holder of Securities will
receive on the Purchase Contract Settlement Date with respect
to each Purchase Contract forming a part thereof, the kind
and amount of securities, cash and other property receivable
upon such Reorganization Event by a holder of the number of
shares of the Company's Common Stock issuable on account of
each Purchase Contract as if the Purchase Contract Settlement
Date had occurred immediately prior to such Reorganization
Event and assuming such holder failed to exercise his rights
of election as to the kind or amount of securities, cash and
other property so receivable.
METHOD OF CALCULATION:
1) Settlement Rate prior to the Effective Time (with the original
Settlement Rate and Applicable Market Value previously adjusted
pursuant to Sections 5.6(a)(3) and 5.6(a)(9) to reflect a
two-for-one stock split effective 2/18/98):
a) if the Applicable Market Value is equal to or greater than
$18.91 (the "Threshold Appreciation Price"), 2.644 shares of
Company Common Stock per Purchase Contract;
b) if the Applicable Market Value is less than the Threshold
Appreciation Price, but greater than $15.50, the number of
Shares of Company Common Stock equal to the Stated Amount
divided by the Applicable Market Value, and
c) if the Applicable Market Value is less than or equal to $15.50,
3.226 shares of Company Common Stock per Purchase Contract.
2) The Applicable Market Value of the Company's Common Stock
calculated prior to the Merger is greater than the Threshold
Appreciation Price ($18.91). Accordingly, as described in 1)a)
above, the applicable Settlement Rate as if the Purchase Contract
Settlement Date had occurred immediately prior to the Merger (but
prior to adjustment for the Merger) is 2.644 shares of Company
Common Stock per Purchase Contract.
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3) Securities Receivable Upon Reorganization Event: Upon
consummation of the Merger, each non-electing holder of a share
of the Company's Common Stock will receive 1.34973 shares of
Allstate Common Stock (the number of shares of Allstate Common
Stock equal to $32.25, as calculated in accordance with the
Merger Agreement).
4) Adjusted Settlement Rate: Accordingly, unless there shall have
occurred a Termination Event, each Holder of a Purchase Contract
will be obligated to purchase on the Purchase Contract
Settlement Date (subject to the next sentence) at a price equal
to the Stated Amount ($50), and Merger Sub and Allstate will be
required to sell at such price, 3.5687 shares of Allstate Common
Stock (the product of 2.644 times 1.34973), subject to any
further adjustments in the Settlement Rate under Article V of
the Purchase Contract Agreement prior to settlement. Pursuant to
the Purchase Contract Agreement, in the case of Early
Settlement, Cash Settlement or through the application of
Proceeds from related Treasury Securities, the Cash Settlement
Rate and Early Settlement Rate (as applicable) will also be
determined based on the adjusted Settlement Rate as applicable
to the Allstate Common Stock.
(3) The Company is not in default in the performance of any covenant or
condition under the Purchase Contract Agreement, any of the Securities,
or the Pledge Agreement.
Capitalized terms used and not otherwise defined herein shall have the
meanings ascribed to such terms in the Supplemental Agreement and the Purchase
Contract Agreement.
IN WITNESS WHEREOF, I have executed this Certificate on this____day of
October, 1999.
American Heritage Life Investment
Corporation
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By:
Title:
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