As filed with the Securities and Exchange Commission on February 27, 2006
Registration No. 333-129157
=================================================================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 2 TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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ALLSTATE LIFE GLOBAL FUNDING ALLSTATE LIFE INSURANCE COMPANY
(As depositor of the trusts described herein, (As sponsor of the trusts described herein and as
and as issuer of the funding notes described herein) issuer of the funding agreements described herein)
(Exact name of registrant as specified in its charter) (Exact name of registrant as specified in its charter)
Delaware Illinois
(State or other jurisdiction of incorporation or organization) (State or other jurisdiction of incorporation or organization)
Not Applicable 36-2554642
(I.R.S. Employer Identification Number) (I.R.S. Employer Identification Number)
6525 Morrison Boulevard, Suite 318 3100 Sanders Road
Charlotte, NC 28211 Northbrook, IL 60062
(704) 365-0569 (847) 402-5000
(Address, including zip code, and telephone number, including area (Address, including zip code, and telephone number,
code of registrant's principal executive offices) including area code, of registrant's principal
executive offices)
Douglas K. Johnson Michael J. Velotta
President of AMACAR Pacific Corp., Senior Vice President, General Counsel
Administrator of Allstate Life Global Funding and Secretary of Allstate Life Insurance Company
and Allstate Life Global Funding Trusts 3100 Sanders Road
6525 Morrison Boulevard, Suite 318 Northbrook, IL 60062
Charlotte, NC 28211 (847) 402-5000
(704) 365-0569
(Name, address, including zip code, and telephone number, including area code, of
agents for service with respect to the registrants)
Copies to:
John M. Schwolsky Anthony J. Ribaudo
Joseph L. Seiler III Sidley Austin LLP
Vladimir Nicenko One South Dearborn
LeBoeuf, Lamb, Greene & MacRae LLP Chicago, Illinois 60603
125 West 55th Street (312) 853-7000
New York, NY 10019
(212) 424-8000
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Approximate date of commencement of proposed sale to the public: As soon as
practicable after this registration statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, check the following box.
|_|
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. |X|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. |_|
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_|
If delivery of the Prospectus is expected to be made pursuant to Rule 434,
please check the following box. |_|
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CALCULATION OF REGISTRATION FEE
===================================================================================================================================
Proposed Maximum Proposed Maximum Amount of
Amount to Offering Price Aggregate Offering Registration
Title of Each Class of Securities to be Registered be Registered(1) Per Unit Price(2)(3)(4) Fee(5)
- -----------------------------------------------------------------------------------------------------------------------------------
Secured Medium Term Notes(6)........................ $5,000,000,000 100% $5,000,000,000 $577,265(7)
Funding Notes(8).................................... $5,000,000,000 100% $5,000,000,000 None(8)
Funding Agreements(9)............................... $5,000,000,000 100% $5,000,000,000 None(9)
==================================================================================================================================
(1) Securities in the amount of $1,650,000,000 registered by the registrants
under Registration Statement No. 333-125937 and not previously sold are
consolidated in this registration statement pursuant to Rule 429 under the
Securities Act of 1933. Accordingly, the total amount of securities to be
registered under this registration statement as so consolidated is
$5,000,000,000. The amount of securities being registered represents the
maximum aggregate principal amount of securities which, as of the date of
this filing, are expected to be offered for sale.
(2) Estimated solely for the purpose of determining the amount of the
registration fee pursuant to Rule 457(o) under the Securities Act of 1933.
(3) If any securities are (a) denominated or payable in a foreign or composite
currency or currencies, such principal amount as shall result in an
aggregate initial offering price equivalent to $5,000,000,000, at the time
of initial offering, (b) issued at an original issue discount, such greater
principal amount as shall result in an aggregate initial offering price of
$5,000,000,000, or (c) issued with their principal amount payable at
maturity to be determined with reference to a currency exchange rate or
other index, such principal amount as shall result in an aggregate initial
offering price of $5,000,000,000.
(4) $5,000,000,000 is the estimated maximum aggregate offering price of all the
securities being registered.
(5) The registration fee has been calculated on the basis of the maximum
aggregate offering price of all securities listed in accordance with Rule
457(o) under the Securities Act of 1933.
(6) Each issuance of Secured Medium Term Notes will be made by a newly formed
separate and distinct trust.
(7) $194,205 of the total registration fee of $577,265 was paid in connection
with Registration Statement No. 333-125937. Registration fees in the amount
of $270,710 were paid on October 20, 2005 in connection with the initial
filing of this registration statement.
(8) Registered solely pursuant to Rule 140 under the Securities Act of 1933.
Each Funding Note of Allstate Life Global Funding will be purchased by a
separate and distinct trust with the net proceeds from the sale of a
related series of Secured Medium Term Notes issued by such trust. Pursuant
to Rule 457(o) under the Securities Act of 1933, no separate registration
fees are payable in respect of the Funding Notes.
(9) Each Funding Agreement of Allstate Life Insurance Company will be purchased
by Allstate Life Global Funding with the net proceeds from the sale of the
related Funding Notes. Pursuant to Rule 457(o) under the Securities Act of
1933, no separate registration fees are payable in respect of the Funding
Agreements.
------------------
The registrants hereby amend this registration statement on a date
necessary to delay their effectiveness until the registrants file a further
amendment specifically stating that this registration statement will become
effective according to Section 8(a) of the Securities Act of 1933 or until this
registration statement shall become effective on the date the Commission
determines.
==============================================================================
EXPLANATORY NOTE
This registration statement contains:
o two prospectus supplements relating to one or more series of notes (one for
an offering of series of secured medium term notes which are intended to be
offered primarily to institutional investors and the other for an offering
of series of secured medium term notes which are referred to as Allstate
Life(R) CoreNotes(R) in the prospectus supplements and which are intended
to be offered primarily to retail investors) which one or more newly
created separate and distinct Delaware special purpose statutory trusts may
offer from time to time to the public, as well as each related funding note
which may be issued by Allstate Life Global Funding to the issuing trust,
and one or more applicable funding agreements which may be issued by
Allstate Life Insurance Company, and sold to, and deposited into, the
issuing trust by Allstate Life Global Funding; and
o a base prospectus relating to one or more series of secured medium term
notes (including series of Allstate Life(R) CoreNotes(R)) which may be
issued and sold by the trusts to the public, as well as each related
funding note which may be issued by Allstate Life Global Funding to the
issuing trust, and one or more applicable funding agreements which may be
issued by Allstate Life Insurance Company, and sold to, and deposited into,
the issuing trust by Allstate Life Global Funding.
Each offering of a series of notes and the related funding note and funding
agreement(s) made under this registration statement will be made pursuant to:
o the base prospectus and one of the prospectus supplements included in
this registration statement, with the specifications of the applicable series of
notes, and the related funding note and funding agreement(s), set forth in the
applicable pricing supplement; or
o the base prospectus and a newly filed prospectus supplement to the base
prospectus, with the specification of the applicable series of notes, and the
related funding note and funding agreement(s) set forth in such newly filed
prospectus supplement or a pricing supplement.
"Allstate Life(R)" is a registered service mark of Allstate Insurance Company.
"CoreNotes(R)" is a registered service mark of Merrill Lynch & Co., Inc.
Subject to Completion
Preliminary Prospectus Supplement dated February -, 2006
PROSPECTUS SUPPLEMENT
(To prospectus dated February -, 2006)
$5,000,000,000
Allstate Life Global Funding
Depositor
Secured Medium Term Notes
Due Between Nine Months and 30 Years From the Date of Issue
Issued Through Allstate Life Global Funding Trusts
Secured by
Funding Agreements Issued by
Allstate Life Insurance Company
Sponsor
------------------
Allstate Life Global Funding (the "depositor" or "Global Funding") is a
statutory trust formed under the laws of the State of Delaware. Its primary
purpose is to facilitate the programs for the issuance of one or more series of
secured medium term notes (the "notes"). Each series of notes will be issued by
a newly created separate and distinct Delaware statutory trust (each, a
"trust"). The notes of each series will be secured by one or more funding
agreements (each, a "funding agreement") issued by Allstate Life Insurance
Company ("Allstate Life") and assigned absolutely to, and deposited into, the
issuing trust by Global Funding. Global Funding will be the sole beneficial
owner of each trust that is formed and the depositor of the funding agreements
into the issuing trusts. In connection with each offering of notes, Global
Funding will issue the applicable funding note (each, a "funding note") as more
fully described herein. Allstate Life is the sponsor of the programs.
The notes of each series will represent the obligations of the issuing
trust and will constitute "asset-backed securities" within the meaning of
Regulation AB under the Securities Act of 1933, as amended.
The specific terms of each series of notes, and the related funding note
and funding agreement(s), will be set forth in a separate prospectus supplement
to this prospectus supplement and the accompanying prospectus (a "pricing
supplement"), which will be prepared in connection with the issuance of such
series of notes, including the information related to the interest rate or
specified rate of return thereof, the distribution frequency and the first
expected distribution date. The form of pricing supplement, which includes
bracketed alternatives that may form part of the structure of an offering of
notes pursuant to the program described in this prospectus supplement and the
accompanying prospectus, is included in this prospectus supplement as Annex A.
You should read this prospectus supplement, the accompanying prospectus and the
applicable pricing supplement carefully before you invest.
The notes of each series:
o will be issued in only one class;
o will represent the unconditional, direct, non-recourse, secured and
unsubordinated obligations of the issuing trust only and will not
represent the obligations of, or interest in, any other trust, Global
Funding, Allstate Life or any of their respective affiliates;
o will have a stated maturity of nine months to 30 years from the date
of issue;
o will have redemption and/or repayment provisions, if applicable,
whether mandatory or at the option of the issuing trust or the holders
of such notes;
o will provide for payments in U.S. dollars or one or more foreign
currencies;
o will be in book-entry or definitive form;
o will bear interest at fixed or floating rates, or bear no interest at
all; unless otherwise specified in the applicable pricing supplement,
each trust will pay interest on the relevant series of notes on a
monthly, quarterly, semiannual or annual basis;
o will be secured by the right, title and interest of the issuing trust
in and to (1) the funding agreement(s) held by that trust, (2) all
proceeds of such funding agreement(s) and (3) all books and records
pertaining to such funding agreement(s); and
o may be sold to United States and foreign institutional and other
investors.
The funding note and funding agreement(s) issued in connection with the
offering of a series of notes will represent the respective obligations of
Global Funding and Allstate Life only and will not represent the obligations of
or the interest in any person other than the respective issuing entity.
Each class of securities offered may have an aggregate principal amount of
up to $5,000,000,000 or the equivalent amount in one or more foreign or
composite currencies.
Investing in these securities involves risks that are described in the
"Risk Factors" section beginning on page S-[ ].
------------------
Neither the Securities and Exchange Commission, any state securities
commission nor any state insurance commission has approved or disapproved of
these securities or determined if this prospectus supplement, the accompanying
prospectus or any pricing supplement is truthful or complete. Any representation
to the contrary is a criminal offense.
Merrill Lynch & Co.
A.G. Edwards & Sons, Inc.
Banc of America Securities LLC
Barclays Capital
Bear, Stearns & Co. Inc.
Citigroup
Credit Suisse
Deutsche Bank Securities
Goldman, Sachs & Co.
JPMorgan
Lehman Brothers
Morgan Stanley
RBS Greenwich Capital
UBS Investment Bank
Wachovia Securities
------------------
The date of this prospectus supplement is -, 2006.
TABLE OF CONTENTS
Page
Prospectus Supplement
Forward-Looking Statements..............................................................................................S-1
About this Prospectus Supplement and the Pricing Supplements............................................................S-2
Summary.................................................................................................................S-3
Risk Factors...........................................................................................................S-12
Allstate Life Global Funding Trusts....................................................................................S-18
Allstate Life Global Funding...........................................................................................S-18
Allstate Life Insurance Company........................................................................................S-19
Description of the Notes...............................................................................................S-20
Global Clearance and Settlement Procedures.............................................................................S-45
Special Provisions Relating to Foreign Currency Notes..................................................................S-47
Description of the Funding Agreements..................................................................................S-49
United States Federal Income Tax Considerations........................................................................S-50
Plan of Distribution...................................................................................................S-60
Annex A: Form of Pricing Supplement...................................................................................A-1
Prospectus
Forward-Looking Statements................................................................................................1
About this Prospectus.....................................................................................................2
Available Information.....................................................................................................3
Incorporation of Documents by Reference...................................................................................3
Description of Allstate Life Global Funding and the Trusts................................................................5
Description of Allstate Life Insurance Company...........................................................................16
Computation of Ratio of Earnings to Fixed Charges........................................................................17
Use of Proceeds..........................................................................................................17
Description of the Notes.................................................................................................18
Description of the Indentures............................................................................................19
Description of the Funding Notes.........................................................................................30
Description of the Funding Agreements....................................................................................31
Description of the Support and Expenses Agreements.......................................................................37
Description of the Administrative Services Agreements....................................................................38
ERISA Considerations.....................................................................................................39
Plan of Distribution.....................................................................................................42
Legal Opinions...........................................................................................................43
Experts..................................................................................................................43
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The trusts may sell the notes to one or more of the agents referred to
below (collectively, the "Agents") as principals for resale at varying or fixed
offering prices or through the applicable Agent(s) as agents using their
reasonable efforts on behalf of each issuing trust. The trusts may also sell
notes directly to investors without the assistance of any Agent. Unless
otherwise specified in the applicable pricing supplement, any note sold to an
Agent as principal will be purchased by that Agent at a price equal to 100% of
the principal amount thereof less a percentage of the principal amount equal to
the commission applicable to an agency sale of a note of identical maturity.
Unless otherwise specified in the applicable pricing supplement, each trust will
pay a commission to an Agent, ranging from .150% to .875% of the principal
amount of each note, depending upon its stated maturity, sold through that Agent
as its agent.
You should rely on the information contained or incorporated by reference
in this prospectus supplement, the accompanying prospectus and each applicable
pricing supplement. Neither the registrants nor any Agent has authorized anyone
to provide you with different or additional information. If anyone provides you
with different or additional information, you should not rely on it. Neither the
registrants nor any Agent is making an offer to sell the notes in any
jurisdiction where the offer or sale is not permitted. You should not assume
that the information contained or incorporated by reference in this prospectus
supplement, the accompanying prospectus and the applicable pricing supplement is
accurate as of any date other than the date of such document.
FORWARD-LOOKING STATEMENTS
Allstate Life
This prospectus supplement, the accompanying prospectus and each applicable
pricing supplement may include forward-looking statements of Allstate Life.
These forward-looking statements are not statements of historical fact but
rather reflect Allstate Life's current expectations, estimates and predictions
about future results and events. These statements may use words such as "will,"
"should," "likely," "target," "anticipate," "believe," "estimate," "expect,"
"intend," "predict," "project" and similar expressions as they relate to
Allstate Life or its management. When Allstate Life makes forward-looking
statements, Allstate Life is basing them on its management's beliefs and
assumptions, using information currently available to Allstate Life. These
forward-looking statements are subject to risks, uncertainties and assumptions,
including but not limited to, risks, uncertainties and assumptions discussed in
this prospectus supplement, the accompanying prospectus and in each applicable
pricing supplement. Factors that can cause or contribute to these differences
include those described under the heading "Risk Factors" in this prospectus
supplement. Allstate Life undertakes no obligation to publicly update or revise
any forward-looking statements, whether as a result of new information, future
events, developments or otherwise.
If one or more of these or other risks or uncertainties materialize, or if
Allstate Life's underlying assumptions prove to be incorrect, actual results may
vary materially from what Allstate Life projected. Any forward-looking
statements of Allstate Life you read in this prospectus supplement, the
accompanying prospectus or any pricing supplement reflect Allstate Life's
current views with respect to future events and are subject to these and other
risks, uncertainties and assumptions relating to Allstate Life's operations,
results of operations, growth strategy and liquidity. All subsequent written and
oral forward-looking statements attributable to Allstate Life or individuals
acting on Allstate Life's behalf are expressly qualified in their entirety by
this section. You should specifically consider the factors identified in this
prospectus supplement, the accompanying prospectus and each applicable pricing
supplement which could cause actual results to differ before making an
investment decision.
Global Funding and the Trusts
This prospectus supplement, the accompanying prospectus and each applicable
pricing supplement may include forward-looking statements of Global Funding and
the trusts. These forward-looking statements are subject to risks, uncertainties
and assumptions, including but not limited to, risks, uncertainties and
assumptions discussed in this prospectus supplement, the accompanying prospectus
and in each applicable pricing supplement. Global Funding does not, and the
trusts will not, undertake any obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.
You should specifically consider the factors identified in this prospectus
supplement, the accompanying prospectus and each applicable pricing supplement
before making an investment decision. The trusts are not entitled to the safe
harbors contained in Section 27A of the Securities Act of 1933, as amended (the
"Securities Act") and Section 21E of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), with respect to forward-looking statements of the
trusts in this prospectus supplement, the accompanying prospectus and each
applicable pricing supplement.
S-1
ABOUT THIS PROSPECTUS SUPPLEMENT AND THE PRICING SUPPLEMENTS
This document is a prospectus supplement and supplements a prospectus which
is part of a registration statement filed with the Securities and Exchange
Commission (the "SEC") by Allstate Life Global Funding and Allstate Life
Insurance Company (the "registrants"). This prospectus supplement provides you
with a general description of the notes that each trust may offer in connection
with the secured medium term notes program and the related funding notes and
funding agreements described in this prospectus supplement and the accompanying
prospectus (this "program") and supplements the description of the notes,
funding notes and funding agreements contained in the accompanying prospectus.
The trusts may sell notes with a total initial public offering price or purchase
price of up to $5,000,000,000 or the equivalent amount in one or more foreign
currencies, less any amount of notes previously issued by the trusts under this
program or pursuant to a separate prospectus supplement that relates to the
Allstate Life(R) CoreNotes(R) program pursuant to which the notes may be offered
by the trusts from time to time primarily to retail investors (the "Allstate
Life(R) CoreNotes(R) program").
The specific terms and conditions of a series of notes and the related
funding note and funding agreement(s) being offered will be contained in a
pricing supplement. A copy of that pricing supplement will be provided to you
along with a copy of this prospectus supplement and the accompanying prospectus.
That pricing supplement also may add, update, supplement or clarify information
in this prospectus supplement and the accompanying prospectus. You should
carefully review such additional, updated, supplemental or clarifying
information contained in the pricing supplement. You should read this prospectus
supplement and the accompanying prospectus and each applicable pricing
supplement together with the additional information that is incorporated by
reference in this prospectus supplement and the accompanying prospectus. That
additional information is described under the heading "Incorporation of
Documents by Reference" in the accompanying prospectus.
In connection with the issuance of any series of notes, the Agents have
reserved the right to appoint one of them to act as a stabilizing agent. Such
appointment will be disclosed in the applicable pricing supplement. In
connection with the issuance of any series of notes, the stabilizing agent or
any person acting on its behalf may over-allot or effect transactions with a
view to supporting the market price of the applicable series of notes at a level
higher than that which might otherwise prevail for a limited period. However,
there is no obligation on the stabilizing agent or any other person acting on
its behalf to do this. Such stabilizing, if commenced, may be discontinued at
any time and must be brought to an end after a limited period. Any such
stabilizing shall be conducted in compliance with all relevant laws, rules and
regulations. For a description of these activities, see "Plan of Distribution."
In this prospectus supplement, references to the "depositor" and "Global
Funding" are to Allstate Life Global Funding. References to the "trusts" are to
Allstate Life Global Funding Trusts. References to an "issuing trust" are to a
trust with respect to the series of notes issued and sold to the public by that
trust. These references are not to Allstate Life Insurance Company. Unless
otherwise specified herein or the context otherwise requires, in this prospectus
supplement, references to "Allstate Life" are to Allstate Life Insurance
Company.
In this prospectus supplement, references to "United States dollars," "U.S.
dollars" or "$" are to lawful currency of the United States of America, and
references to "Euro" are to the currency introduced at the start of the third
stage of the European Economic and Monetary Union pursuant to the Treaty
Establishing the European Community, as amended.
S-2
SUMMARY
This section summarizes certain of the legal and financial terms of the
notes, funding notes and funding agreements that are described in more detail in
"Description of the Notes" and "Description of the Funding Agreements" beginning
on pages S-[ ] and S-[ ] of this prospectus supplement, "Description of the
Funding Notes" beginning on page [ ] of the accompanying prospectus, and other
information described elsewhere in this prospectus supplement or in the
accompanying prospectus. Final terms of any particular series of notes and the
related funding note and funding agreement(s) will be set at the time of
issuance and will be contained in the applicable pricing supplement. That
pricing supplement may add to, update, supplement or clarify the terms contained
in this summary. In addition, you should read the more detailed information
appearing elsewhere in the accompanying prospectus, this prospectus supplement
and the applicable pricing supplement.
The Trusts...................... Each series of notes will be issued by a newly created separate and distinct Delaware
statutory trust (each, a "trust") formed by Allstate Life Global Funding, as trust
beneficial owner, AMACAR Pacific Corp., as administrator (including any successor, the
"administrator"), and Wilmington Trust Company, as Delaware trustee (including any
successor, the "Delaware trustee"), pursuant to the filing of a certificate of trust and
the execution of a trust agreement. Each trust agreement pursuant to which various trusts
may be formed from time to time to issue notes is referred to in this prospectus
supplement as a "trust agreement." Allstate Life Global Funding will be the sole
beneficial owner of each trust that is formed.
Depositor; Issuer of Funding
Notes........................ Allstate Life Global Funding is a registrant as the depositor of the funding agreements
into the issuing trusts and the issuer of the funding notes.
Sponsor; Issuer of Funding
Agreements................... Allstate Life Insurance Company is the sponsor of the programs and a registrant as the
issuer of the funding agreements.
Allstate Life is not affiliated with any trust. None of Allstate Life or any of its
officers, directors, subsidiaries or affiliates owns any beneficial interest in any trust
nor has any of these persons or entities entered into any agreement with any trust other
than in furtherance of the issuance of notes from time to time as contemplated by this
prospectus supplement and the accompanying prospectus.
None of Allstate Life or any of its officers, directors, subsidiaries or affiliates is
affiliated with Global Funding, the Delaware trustee, the administrator, the indenture
trustee or the funding note indenture trustee.
Purposes of Global Funding and
Trusts....................... The primary purpose of Global Funding is to facilitate the programs for the issuance of
notes, including, in connection with each offering of notes, to issue the applicable
funding note. The primary purpose of each trust is to issue the related series of notes
to the public, which notes will be issued only on the original issue date of such notes
and will be secured by one or more funding agreements issued by Allstate Life, and
assigned absolutely to, and deposited into, the issuing trust by Global Funding. Each
trust will use the net proceeds received from issuing its series of notes to acquire one
or more funding agreements. Each trust will hold the collateral described below
pertaining to its series of notes to fund its obligations under that series of notes.
Each trust will pledge and collaterally assign the funding agreement(s) held in that
trust to the indenture trustee for the benefit of the holders of that trust's series of
notes and any other person for whose benefit the indenture trustee is or will be holding
the applicable collateral.
The notes of each series will represent the obligations of the issuing trust only and
will not represent the obligations of, or interest in, any other trust, Global Funding,
Allstate Life, or any of their respective affiliates. Holders of notes of a series may
only look to the funding agreement(s) and any other collateral held in, or pledged and
collaterally assigned to the indenture trustee by, the issuing trust for payment on
their notes and not to the assets of
S-3
Allstate Life or Global Funding, or the assets held in any other trust.
Delaware Trustee................ Unless otherwise specified in the applicable pricing supplement, Wilmington Trust
Company, a Delaware banking corporation, will be the sole trustee of Global Funding and
each trust. In this prospectus supplement and the accompanying prospectus, references to
"Delaware trustee" (i) with respect to any trust are to Wilmington Trust Company (or
another entity specified in the applicable trust agreement), as Delaware trustee of such
trust (including, in each case, any successor); and (ii) with respect to Global Funding
are to Wilmington Trust Company as Delaware trustee of Global Funding (including any
successor). The Delaware trustee will not be obligated in any way to make payments under
or in respect of any notes, any funding notes or any funding agreements. The Delaware
trustee is not affiliated with Allstate Life or the indenture trustee.
Administrator................... Unless otherwise specified in the applicable pricing supplement, AMACAR Pacific Corp.
will be the administrator of Global Funding and each trust. In this prospectus supplement
and the accompanying prospectus, references to the "administrator" (i) with respect to
any trust are to AMACAR Pacific Corp. (or another entity specified in the applicable
trust agreement), as administrator of such trust (including, in each case, any
successor); and (ii) with respect to Global Funding are to AMACAR Pacific Corp. as
administrator of Global Funding (including any successor). The administrator will not be
obligated in any way to make any payments under or in respect of the notes, any funding
notes or any funding agreements. The administrator is not affiliated with Allstate Life
or the indenture trustee.
Indenture Trustee............... Each series of notes will be issued by the issuing trust pursuant to a separate indenture
(each, an "indenture") to be entered into among the issuing trust and J.P. Morgan Trust
Company, National Association (or another entity specified as indenture trustee in the
applicable indenture), in its capacity as indenture trustee (including any successor, the
"indenture trustee"). The indenture trustee will not be affiliated with the trusts, the
Delaware trustee, the administrator, Global Funding or Allstate Life.
Funding Note Indenture Trustee.. Each funding note will be issued by Global Funding pursuant to a separate funding note
indenture (each, a "funding note indenture") to be entered into among Global Funding and
the other parties specified therein, including J.P. Morgan Trust Company, National
Association (or another entity specified as the funding note indenture trustee in the
applicable funding note indenture), in its capacity as funding note indenture trustee
(including any successor, the "funding note indenture trustee"). The funding note
indenture trustee is not affiliated with the trusts, the Delaware Trustee, the
administrator, Global Funding or Allstate Life.
Servicer........................ Unless otherwise provided in the pricing supplement for a series of notes, pursuant to
each indenture, J.P. Morgan Trust Company, National Association, will perform the
functions of the servicer in respect of the programs.
Diagram of Parties ............. Below is a diagram showing the parties involved in the issuance of notes by each trust.
Funding Agreement(s)
Deposit of Funding Agreement(s)
--- into issuing trust. Funding note --- Security Interest in
| is simultaneously cancelled. | Funding Agreement(s)
| | (held for the benefit
Funding | | of holders)
Agreement(s) | Funding Note |
- ------------------- ----------------- ---------------- --------------
|Allstate Life |---------------> |Allstate Life |------------------>| | ---------------- | Indenture |
|Insurance Company|<-------------- |Global Funding |<----------------- | Issuing Trust| | Trustee |
- ------------------- Note Proceeds ----------------- Note Proceeds ---------------- --------------
^ |
| |
Note
Proceeds Notes
| |
| v
----------------
| |
| Noteholders |
----------------
S-4
Allstate Life Can Issue Its Own
Medium Term Notes and Funding
Agreements Directly to
Investors.................... Allstate Life is able to issue its own medium term notes directly to investors and does
issue funding agreements directly to qualified investors. However, by securing each
trust's notes with one or more of Allstate Life's funding agreements, such trust's notes
are secured by an asset that would have a higher priority in insolvency than unsecured
medium term notes of Allstate Life and, accordingly, may be entitled to receive a higher
investment rating than unsecured medium term notes of Allstate Life. In addition, funding
agreements are very difficult to transfer and have no active secondary market. By
securing each trust's notes with one or more of Allstate Life's funding agreements,
investors may be able to avail themselves of many of the benefits of Allstate Life's
funding agreements while benefiting from the liquidity afforded by each trust's medium
term notes.
Agents.......................... Merrill Lynch, Pierce, Fenner & Smith Incorporated, A.G. Edwards & Sons, Inc., Banc of
America Securities LLC, Barclays Capital Inc., Bear, Stearns & Co. Inc., Citigroup Global
Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc., Goldman,
Sachs & Co., Greenwich Capital Markets, Inc., J.P. Morgan Securities Inc., Lehman
Brothers Inc., Morgan Stanley & Co. Incorporated, UBS Securities LLC and Wachovia
Capital Markets, LLC.
Secured Medium Term Notes
Program ..................... This prospectus supplement relates to notes that each trust may issue and sell primarily
to institutional investors under this secured medium term notes program.
Allstate Life(R) CoreNotes(R)
Program...................... Included in the registration statement, of which this prospectus supplement is a part,
is another prospectus supplement relating to notes that may be issued and sold primarily
to retail investors by one or more newly established Delaware statutory trusts under
the related Allstate Life(R) CoreNotes(R) program. The terms of the Allstate Life(R)
CoreNotes(R) are identical in all material respects to the terms of the notes to be sold
under this program, as described in this prospectus supplement, except that the
Allstate Life(R) CoreNotes(R):
o may not be issued as amortizing notes;
o will be denominated in U.S. dollars only;
o will not provide for the payment of additional amounts
relating to any required withholding under any
circumstances; and
o may contain a survivor's option, permitting optional
repayment of notes of a series of notes, subject to
certain limitations, prior to maturity, if requested,
following the death of the beneficial owner of notes of
that series.
Amount of the Notes............. The trusts may collectively issue up to a maximum of $5,000,000,000 of notes, or the
equivalent in one or more foreign or composite currencies, in connection with this
prospectus supplement, less any amount of notes previously issued under this program, the
related Allstate Life(R) CoreNotes(R) program or otherwise under the accompanying prospectus.
Flow of Funds................... All funds deposited with the indenture trustee pursuant to an indenture in respect of
notes of a series, except when an event of default has occurred and is continuing under
the indenture, shall be held in trust in the applicable collection account and applied by
the indenture trustee, in accordance with the provisions of the notes of such series and
the applicable indenture, to the payment through any paying agent, to the persons
entitled
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thereto, of the principal, premium, if any, interest and additional amounts, if
any, for whose payment such money has been deposited with or received by the indenture
trustee. If no event of default with respect to the notes of a series has occurred and
is continuing, the following priority of payments shall apply:
o First: to the payment of principal, any premium and interest, any additional
amounts, and any other amounts then due and owing on the notes of such series,
ratably, without preference or priority of any kind, according to the aggregate
amounts due and payable on such notes;
o Second: to the payment of any other obligations then due and owing with respect
to such series of notes, ratably, without preference or priority of any
kind; and
o Third: to the payment of any remaining balance to the issuing trust for
distribution by the Delaware trustee in accordance with the provisions of the
applicable trust agreement.
Any funds collected by the indenture trustee following an event of default, and during the
continuance thereof, under the applicable indenture in respect of the notes of a series
shall be held in trust in the applicable collection account and be applied in the
following order at the date or dates fixed by the indenture trustee and, in case of the
distribution of such funds on account of principal, any premium and interest and any
other amounts due and owing, upon presentation of the global security or
certificates representing the notes of such series and the notation thereon of the
payment if only partially paid or upon the surrender thereof if fully paid:
o First: to the payment of costs and expenses, includingreasonable
compensation to the indenture trustee and each predecessor indenture trustee
and their respective agents and attorneys and of all expenses and liabilities
incurred, and all advances made, by the indenture trustee and each predecessor
indenture trustee except as those adjudicated in a court of competent jurisdiction
to be the result of any such indenture trustee's negligence or bad faith, in an
aggregate amount of no more than $250,000 for all series of notes outstanding;
o Second: to the payment of principal, any premium and interest, any additional
amounts and any other amounts then due and owing on the notes of such series,
ratably, without preference or priority of any kind, according to the aggregate
amounts due and payable on such notes;
o Third: to the payment of any other obligations then due and owing with respect to
such series of notes, ratably, without preference or priority of any kind; and
o Fourth: to the payment of any remaining balance to the issuing trust for distribution
by the Delaware trustee in accordance with the provisions of the applicable
trust agreement.
All funds and other property received by the Delaware trustee on behalf of the issuing trust in
respect of the applicable collateral will be deposited into the payment account of such trust
and will be distributed by such trust as follows:
o First: to the indenture trustee for the payment of all amounts then due and unpaid
upon the applicable series of notes and any other amounts due and payable in
accordance with the applicable indenture; and
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o Second: upon the final redemption of the applicable series of notes and payment
of any amounts payable in respect thereof, any remaining funds and other property
deposited into the payment account shall be distributed to the Delaware trustee for
distribution as provided below.
In connection with the termination of any trust that is formed and the distribution of all
amounts from the applicable payment account in accordance with the priority described above,
the Delaware trustee will distribute any amounts received in accordance with the second clause of
the immediately preceding paragraph and any other remaining assets of the trust in the
following order of priority:
o First: to pay all expenses and other liabilities owed by the applicable trust; and
o Second: any remaining funds and other property shall be paid to the trust beneficial
owner.
Terms of the Notes:
Status....................... o The notes of a series will represent the unconditional, direct, non-recourse
and unsubordinated obligations of the issuing trust and will rank equally among
themselves.
o Each series of notes may be accelerated in the payment of principal and outstanding
interest if an event of default under the notes of such series occurs. Upon the
occurrence of an event of default, the indenture trustee on behalf of the
holders of notes of such series may only proceed against the collateral held in
the issuing trust.
o The notes of each series are not intended to be insurance contracts,
insurance policies or funding agreements.
o The notes of each series will represent the obligations of the issuing trust only
and will not represent the obligations of, or interest in, any other trust, Global
Funding, Allstate Life or any of their respective affiliates.
o The notes are not guaranteed by any person or entity.
o The notes will not benefit from any insurance guaranty fund coverage or any
similar protection.
Payment of Principal and
Interest..................... o Principal and interest payments, if any, on any series of notes will be
made solely from the proceeds of one or more funding agreements, and any
other collateral, securing such series of notes. Each series of notes may
be interest bearing or non-interest bearing.
o Each series of notes that bears interest may bear interest at either a fixed
rate or a floating rate, or a combination of fixed and floating rates, as specified
in the applicable pricing supplement.
o A trust may issue amortizing notes that pay an amount in respect of both interest
and principal amortized over the life of the notes, if so specified in the
applicable pricing supplement.
o The principal amount of each note (other than amortizing notes) will be
payable on its stated maturity date, repayment date or redemption date, as
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specified in the applicable pricing supplement, at the corporate trust office of
the paying agent or any other place designated by the issuing trust.
o Interest, if any, will be payable on the dates set forth in the applicable pricing
supplement.
Interest Rate................ o Each series of fixed rate notes will bear interest from its date of issue at the rate
stated in the applicable pricing supplement until the principal is paid. Each
series of floating rate notes will bear interest from the date of issue until the
principal is paid at a rate determined by reference to an interest rate or interest
rate formula, which may be adjusted by a spread and/or spread multiplier (each as
more fully described under "Description of the Notes"). The pricing supplement for a
series of floating rate notes will designate one or more of the following base rates,
along with the index maturity for that base rate:
o the CD Rate,
o the CMT Rate,
o the Commercial Paper Rate,
o the Constant Maturity Swap Rate
o the Eleventh District Cost of Funds Rate,
o the Federal Funds Open Rate
o the Federal Funds Rate,
o LIBOR,
o EURIBOR,
o the Prime Rate, or
o the Treasury Rate.
Redemption and Repayment............. o A trust will redeem its series of notes if Allstate Life redeems each funding
agreement securing such series of notes. Except as otherwise specified in the
accompanying prospectus, this prospectus supplement or the applicable
pricing supplement, the funding agreement(s) securing a series of notes will not be
redeemable by Allstate Life, and a series of notes will not be repayable at
the option of the holders prior to its stated maturity date. Unless
otherwise specified in the applicable pricing supplement, the notes will
not be subject to any sinking fund.
Maturities............................ o Each series of notes will mature between nine months and 30 years from its date
of original issuance. Each series of notes will have the same maturity date
as the related funding agreement(s).
Currencies and
Denominations.....................Unless otherwise specified in the applicable pricing supplement, notes of a series will be
denominated in U.S. dollars and will be issued and sold in denominations of $1,000 and
integral multiples of $1,000 in excess thereof. Each funding note and funding agreement
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will be issued in the same currency as the notes of the related series. Each funding
note will be issued in the same denomination as the notes of the applicable
series.
Listing of Notes..................... Unless otherwise specified in the applicable pricing supplement, a series of notes
will not be listed on any securities exchange.
Forms of Notes....................... Each series of notes will be issued in fully registered form and, unless otherwise
specified in the applicable pricing supplement, will be initially represented by one or
more book-entry notes registered in the name of Cede & Co., the nominee of The
Depository Trust Company ("DTC"), as depositary, or in the name of a common depositary for
Euroclear Bank S.A./N.V., as operator of the Euroclear System ("Euroclear") or
Clearstream Banking, societe anonyme ("Clearstream Luxembourg"), in each case as depositary
or by one or more definitive notes. Each book-entry note will be held by the indenture
trustee as custodian for the applicable depositary.
Clearing Systems.................... Unless otherwise specified in the applicable pricing supplement, the notes of each series
will be cleared through DTC.
Collateral........................... The notes of a series will be secured by the right, title and interest of the
issuing trust in and to (1) the funding agreement(s) held by that trust, (2) all
proceeds of such funding agreement(s) and (3) all books and records pertaining
to such funding agreement(s). In this prospectus supplement, references to
"other collateral" are to items (2) and (3) above.
Funding Agreements.................. The funding agreements are unsecured obligations of Allstate Life, an Illinois stock
life insurance company. In the event of insolvency of an Illinois insurance company,
claims against the insurer's estate are prioritized pursuant to Section 5/205 of the
Illinois Insurance Code. Under Section 5/205(1)(d) of the Illinois Insurance Code,
claims by "policyholders, beneficiaries, and insureds, under insurance policies,
annuity contracts, and funding agreements" receive payment prior to any
distribution to general creditors not falling within any other priority
class under the Illinois Insurance Code.
The registrants believe that in a properly prepared and presented case in a
delinquency proceeding under Article XIII of the Illinois Insurance Code, 215 ILCS
Section 5/187 et seq.(the "Illinois Liquidation Act"), the timely and properly filed
claims of an owner under the funding agreement (with the possible exception of claims
for Additional Amounts, as discussed below) would be entitled to distribution
pari passu with claims made by other policyholders, beneficiaries, and insureds
under other insurance policies, insurance contracts, annuities and funding agreements
issued by Allstate Life, and the claims of the Illinois Life and Health Insurance
Guaranty Association, and any similar organization in another state, in accordance
with Section 5/205(1)(d) of the Illinois Liquidation Act, and an owner's claims under
the funding agreement should not be recharacterized as other than the claims of a
policyholder, beneficiary, or insured under an insurance policy, insurance contract,
annuity or funding agreement.
The obligations of Allstate Life under any funding agreement will not be guaranteed
by any person or entity.
If a funding agreement so provides, Allstate Life may be required to pay Additional
Amounts (as such term is defined therein) to the indenture trustee as collateral
assignee of the funding agreement. For a discussion regarding payment of Additional
Amounts, see "Description of the Notes--Withholding Tax and Payment of Additional
Amounts." Although such payments could be viewed as a claim under the funding
agreements within the meaning of Section 5/205(1)(d), they may also be argued to be
a separate payment obligation. Therefore, while in a proceeding before a court of
competent jurisdiction the court might find that a claim for an Additional Amount
constitutes a claim under a funding agreement, it also might find that such a
claim is not a claim entitled to the priority afforded by Section 5/205(1)(d).
If a claim for an Additional Amount does not constitute a claim entitled to
the priority afforded by Section 5/205(1)(d), then in a properly prepared
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and presented case any claim for an Additional Amount would be entitled to the same
priority as claims of general creditors of Allstate Life under Section 5/205(1)(g).
With respect to the issuance of any series of the notes, the aggregate amount of
Allstate Life's liabilities that would rank pari passu with each funding agreement
securing such series of notes is disclosed in the financial statements of Allstate
Life contained in Allstate Life's most recent Annual Report on Form 10-K or Quarterly
Report on Form 10-Q filed with the SEC, in each case as of the date of such financial
statements. This amount appears in the Consolidated Statements of Financial Position
as a liability under the line item entitled "Contractholder funds."
Terms of the Funding Notes......... Each trust will use the net proceeds received from the issuance of the related series
of notes to purchase a funding note in definitive form (each, a "funding note")
from Global Funding. Each funding note will have a principal amount equal to the
principal amount of the related series of notes. Each funding note will otherwise
have payment and other terms substantially similar to the related series of notes,
except that each funding note will contain a provision that makes it immediately
cancelable upon the assignment and deposit by Global Funding of the related funding
agreement(s) to the related issuing trust. Such cancellation shall operate
as a redemption and satisfaction of such funding note.
Terms of the Funding
Agreements..................... Global Funding will use the net proceeds received from the sale of the related
funding note to purchase one or more funding agreements issued by Allstate Life.
Global Funding will immediately pledge and collaterally assign each such
funding agreement to the funding note indenture trustee and immediately
thereafter assign absolutely to, and deposit into, the issuing trust each such
funding agreement. The funding agreement(s) will have a principal amount equal to
the principal amount of the related series of notes. The funding agreement(s) will
otherwise have payment and other terms substantially similar to the related
series of notes.
Withholding Tax.................... All amounts due in respect of the notes of a series will be made without any
applicable withholding or deduction for or on account of any present or future taxes,
duties, levies, assessments or other governmental charges of whatever nature
imposed or levied by or on behalf of any governmental authority, unless such
withholding or deduction is required by law. Neither the notes of the applicable
series nor the related funding note or funding agreement(s) will provide for the payment
of additional amounts relating to any required withholding or deduction imposed or
levied on payments in respect of a series of notes or the related funding note or funding
agreement(s). As a result, the risk of any such withholding or deduction, whether or not
as a result of a change in law or otherwise, will be borne by the holders of such series
of notes.
Ratings............................. Unless otherwise indicated in the applicable pricing supplement, it is expected
that each series of notes, and the related funding note and the funding agreement(s)
securing such series of notes will have an issue credit rating of "AA" from Standard & Poor's
Ratings Services, a division of The McGraw-Hill Companies, Inc. ("Standard & Poor's").
It is expected that the program will be rated "Aa2" by Moody's Investors Service, Inc.
("Moody's") and "AA" by Standard & Poor's. If Moody's or Standard & Poor's changes the
program rating, the new program rating will be specified in the applicable pricing
supplement. Notes of a series will be issued under the program only in the event that, at
the time of issuance of such series of notes, at least one nationally recognized rating
agency would assign an investment grade rating to such series of notes, the related
funding note and the funding agreement(s) securing such series of notes.
Fees and Expenses................. Allstate Life and Global Funding entered into an amended and restated support and
expenses agreement dated as of February -, 2006 (the "depositor support agreement").
Pursuant to the depositor support agreement, Allstate Life agreed, among other things,
to pay certain costs and expenses relating to the offering, sale and issuance of
each funding note and certain costs, expenses and taxes of Global Funding.
Pursuant to the depositor
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trust agreement, Allstate Life also agreed to indemnify each service provider of Global
Funding, as well as Global Funding, with respect to certain matters.
In connection with the issuance of a series of notes, Allstate Life and the issuing
trust will enter into a support and expenses agreement (each, a "support agreement").
Under each support agreement, Allstate Life will agree to pay certain costs and expenses
relating to the offering, sale and issuance of the applicable series of notes and
certain costs, expenses and taxes of the issuing trust. Pursuant to each support
agreement, Allstate Life will also agree to indemnify each service provider of the issuing
trust, as well as the issuing trust, with respect to certain matters.
It is anticipated that the indenture trustee fees for this program will be approximately
$13,000 annually.
Governing Law.................... The notes, each indenture, each funding note and each funding note indenture will
be governed by, and construed in accordance with, the laws of the State of New York. The
depositor trust agreement is, and each trust agreement will be, governed by, and construed
in accordance with, the laws of the State of Delaware. The funding agreements will be
governed by the laws of the State of Illinois.
United States Federal Income
Tax Considerations............ Special tax counsel to Global Funding will render its opinion that under current
law and based on certain facts and assumptions contained in such opinion, for United
States Federal income tax purposes, Global Funding and each trust will be ignored and
that the notes will be classified as indebtedness of Allstate Life. Each holder
and beneficial owner of the notes, by purchase of the notes, agrees to such
treatment. Accordingly, holders of the notes generally will have the same United States
federal income tax consequences from the purchase of the notes as they would had they
purchased a debt obligation issued directly by Allstate Life. Prospective purchasers of the
notes must carefully consider the tax consequences of the ownership and disposition the
notes set forth under "United States Federal Income Tax Considerations."
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RISK FACTORS
Your investment in the notes includes risks. In consultation with your own
financial and legal advisers, you should carefully consider, among other
matters, the following discussion of risks before deciding whether an investment
in the notes is suitable for you. The notes are not an appropriate investment
for you if you do not understand their significant components and/or financial
matters. You should also consult the discussion of risk factors set forth in
Allstate Life's most recent Annual Report on Form 10-K, which is incorporated
into this prospectus supplement and the accompanying prospectus by reference.
Risk Factors Relating to the Depositor and the Trusts
Each trust will have limited resources and therefore its ability to make timely
payments with respect to its series of notes will depend upon Allstate Life
making payments under the relevant funding agreement
The ability of a trust to make timely payments with respect to the related
series of notes is principally dependent upon Allstate Life making the related
payments under each relevant funding agreement. Each trust is a special purpose
statutory trust formed for the purpose of the issuance of the related series of
notes. The obligations under a series of notes will be secured by and payable
solely from the collateral held in the issuing trust. No holder of a series of
notes will have any right to receive payments from the collateral related to any
other series of notes.
The notes of a series will represent the obligations of the issuing trust only
and will not represent the obligations of, or be guaranteed by, Allstate Life or
any of its affiliates
The notes will not represent the obligations of Allstate Life, Global
Funding or any other person or entity other than the issuing trust. The notes
will not be guaranteed by any person or entity. Except pursuant to the terms of
the funding agreement(s) included in the collateral for each series of notes,
none of these entities nor any agent, trustee or beneficial owner of Global
Funding or the trusts, in respect of any trust, is under any obligation to
provide funds or capital to Global Funding or the trusts or with respect to any
series of notes issued by the trusts. The net worth of Global Funding on the
date hereof is approximately $1,000 and is not expected to increase materially.
The net worth of each trust is expected to be minimal.
Global Funding is and the trusts will be special purpose entities and, as of the
date of issue of any series of notes, the issuing trust will have no prior
operating history
Global Funding is and the trusts will be special purpose statutory trusts
organized under the laws of the State of Delaware. Global Funding exists for the
primary purpose of facilitating the programs for the issuance of notes. Each
trust will exist for the exclusive purposes of: issuing and selling one series
of notes to investors; using the net proceeds from the sale of series of notes
to acquire the related collateral, including one or more funding agreements; and
engaging in other activities necessary or incidental thereto. As of the date of
issue of any series of notes, the issuing trust will have, no prior operating
history.
Risk Factors Relating to the Notes
The notes of a series represent non-recourse obligations of the issuing trust
The obligations under the notes of a series represent non-recourse
obligations payable solely from the applicable collateral constituting the
assets of the issuing trust. If any event of default shall occur under any
series of the notes, the rights of the holders of the notes of such series and
the indenture trustee, on behalf of such holders, will be limited to a
proceeding against the applicable collateral. None of such holders or the
indenture trustee will have the right to proceed against the collateral related
to any other series of notes, Global Funding, any other trust or any of Allstate
Life, its officers, directors, affiliates, employees or agents or any of the
trustees, beneficial owners or agents, or any of their respective officers,
directors, affiliates, employees or agents in the case of any judgment in which
there is deficiency remaining after foreclosure of any property included in such
collateral. If an event of default shall have occurred under a series of notes,
the indenture trustee will be entitled to have its fees and expenses paid solely
from the collateral of such series of notes before holders of the notes of such
series receive payment of the amounts then due and owing with respect to their
notes; provided, that such priority of the indenture trustee over the holders of
the notes of a series will be limited to an aggregate amount of no more than
$250,000 for all series of notes. All claims of the holders of a series of notes
in excess of amounts received from the related collateral will be extinguished.
In the absence of an event of default under a funding agreement, the occurrence
of an event of default under the related series of notes will not give rise to
any right to accelerate such applicable funding agreement. In that event,
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it is possible that the obligations under the applicable series of notes may be
accelerated while the obligations of Allstate Life under the applicable funding
agreement(s) would not be similarly accelerated. If this occurs, the indenture
trustee may have no or limited ability to proceed against the applicable funding
agreement(s) and the related collateral and holders of the notes may not be paid
in full, or in a timely manner upon such acceleration. See "Description of the
Indentures--Events of Default" in the accompanying prospectus.
Allstate Life will be the sole obligor under the funding agreements
Since Allstate Life will be the sole obligor under the funding agreements,
the ability of a trust to meet its obligations, and your ability to receive
payments from such trust, with respect to a particular series of notes, will be
principally dependent upon Allstate Life's ability to perform its obligations
under each applicable funding agreement held by the issuing trust. Despite this,
you will have no direct contractual rights against Allstate Life under any such
funding agreement. Pursuant to the terms of each funding agreement, recourse
rights to Allstate Life will belong to the issuing trust, its successors and
permitted assignees. In connection with the offering and sale of a series of
notes, the issuing trust will pledge, collaterally assign and grant a security
interest in the collateral for such series of notes to the indenture trustee on
behalf of the holders of the applicable series of notes and the other persons
identified in the relevant indenture. Recourse to Allstate Life under each such
funding agreement will be enforceable only by the indenture trustee as a secured
party for the benefit of holders of such series of notes and any other person
for whose benefit the indenture trustee is or will be holding the collateral.
Accordingly, if Allstate Life fails to perform its obligations under the
applicable funding agreement(s), your ability to receive payments from the
issuing trust would be materially and adversely affected.
Nonetheless, since Allstate Life is a registrant, purchasers of notes may
be able to proceed directly against Allstate Life to enforce their rights under
the Federal securities laws and their rights under the Federal securities laws
will be no different than if they purchased the underlying funding agreements
directly from Allstate Life.
The notes could be deemed to be participations in the funding agreements or
could otherwise be deemed to be contracts of insurance and holders of the notes
could be found to be acting as insurance agents or brokers
The laws and regulations of each state of the United States and the
District of Columbia (the "covered jurisdictions") contain broad definitions of
the activities that may constitute the conduct of the business of insurance in
such jurisdictions. Because the primary asset of each trust will be one or more
funding agreements issued by Allstate Life, which will be sold to, and deposited
into, the issuing trust by Global Funding, it is possible that a trust's
issuance of notes, Global Funding's issuance of the related funding note or the
performance of the issuing trust's obligations under the notes, including the
payment or prepayment of amounts due under the notes, or the purchase, resale or
assignment of the notes by any investor or any person who acquires the notes
directly or indirectly from such investor
o could be characterized by one or more covered jurisdictions as the
conduct of the business of insurance by Global Funding, the issuing
trust, any such investor or any such other person or
o could otherwise subject Global Funding, the issuing trust, any such
investor or any such other person to regulation under the insurance
laws of one or more covered jurisdictions.
This could, among other effects, require such persons to be subject to
regulatory licensure or other qualifications and levels of compliance that
cannot practically be achieved. Failure to comply with such requirements could
subject any such person to regulatory penalties. In the event Global Funding or
any trust is subject to any such penalties or any other liabilities resulting
from such regulation, the ability of holders to receive payment under the notes
could be materially and adversely affected. In addition, any such failure to
comply or the threat of any such regulation could reduce liquidity with respect
to the notes, prevent an investor from transferring notes and reduce the
marketability and market value of the notes. Therefore, any such regulation or
threat of regulation by any one or more covered jurisdictions could result in an
investor either being unable to liquidate its investment in the notes or, upon
any such liquidation, receiving a value significantly less than the initial
investment in the notes.
The Illinois Department of Insurance has confirmed that it does not
consider the sale of publicly offered funding agreement backed medium term notes
to violate the Illinois Insurance Code. In addition, the Illinois Department of
Insurance has approved the form of funding agreement to be used in connection
with each offering of notes.
Based primarily upon communications with the staff of the insurance
regulatory bodies in most states and the legal advice of LeBoeuf, Lamb, Greene &
MacRae LLP, Allstate Life and Global Funding believe that:
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o the notes should not be subject to regulation as participations in the
funding agreements themselves or otherwise constitute insurance
contracts under the insurance laws of the covered jurisdictions; and
o Global Funding, the trusts and persons selling or purchasing the notes
should not be subject to regulation as doing an insurance business
under the insurance laws of the covered jurisdictions by virtue of
their respective activities in connection with the offer, sale and/or
purchase of the notes.
There are, however, wide variations in the insurance laws of the covered
jurisdictions, subtle nuances in their application, and a general absence of any
consistent pattern of interpretation or enforcement. Insurance regulatory
authorities have broad discretionary powers in administering the insurance laws,
including the authority to modify or withdraw a regulatory interpretation,
impose new rules, and take a position contrary to Allstate Life's. In addition,
state courts are not bound by any regulatory interpretations and could take a
position contrary to Allstate Life's. Consequently, there can be no assurance
that the purchase, resale or assignment of the notes or the funding notes will
not subject the parties to such transaction to regulation or enforcement
proceedings under the insurance laws of one or more covered jurisdictions.
Notes of a series may be redeemed early if the trust becomes obligated to pay
Additional Amounts
If a trust is obligated to withhold or deduct any taxes or pay any
additional amount (as defined in "Description of the Notes--Withholding Tax and
Payment of Additional Amounts") with respect to any payment on the notes of a
series to non-U.S. Holders, or if there is a material probability that the
issuing trust will become obligated to withhold or deduct any such taxes or pay
any additional amount (in the opinion of independent legal counsel selected by
Allstate Life), in each case pursuant to a change in or amendment to any United
States tax laws or any regulation or ruling thereunder or any change in the
position of the Internal Revenue Service regarding the application or
interpretation thereof, then Allstate Life, pursuant to the terms of the
relevant funding agreement(s), may terminate the relevant funding agreement(s).
If Allstate Life terminates the relevant funding agreement(s), the issuing trust
will redeem the particular series of notes by giving not less than 30 nor more
than 75 days' notice. Upon such redemption, the trust will pay holders of such
series of notes the outstanding amounts then due and owing with respect to their
notes. If a trust redeems your notes, you may not be able to invest the
redemption proceeds in a comparable security at an interest rate equal to the
interest rate on your notes being redeemed.
Payments under funding agreements may be insufficient to pay principal and
interest, if any, under the notes
Payments of the principal of and any interest on a series of notes will be
made solely from the payments the issuing trust receives under the applicable
funding agreement(s). Unless otherwise specified in this prospectus supplement
or the applicable pricing supplement, Allstate Life will not pay any Additional
Amounts (as defined in the applicable funding agreement) in respect of a funding
agreement to compensate for any withholding or deduction for or on account of
any present or future taxes, duties, levies, assessments or governmental charges
of whatever nature imposed or levied on payments in respect of a funding
agreement, by or on behalf of any governmental authority and each holder of a
note of the related series of notes will be deemed for all purposes to have
received cash in an amount equal to the portion of such withholding or deduction
that is attributable to such holder's interest in the notes, as equitably
determined by the issuing trust. Under this circumstance, the issuing trust will
not actually pay, or cause to be paid, to such holder all of the amounts which
would have been receivable by such holder in the absence of such taxes, duties,
levies, assessments or other governmental charges.
Redemption may adversely affect your return on the notes
If your notes are redeemable at the option of the issuing trust, it may
choose to redeem your notes at times when prevailing interest rates are
relatively low. In addition, if your notes are subject to mandatory redemption,
the issuing trust may be required to redeem your notes also at times when
prevailing interest rates are relatively low. As a result, you may not be able
to reinvest the redemption proceeds in a comparable security at an interest rate
equal to the interest rate on your notes being redeemed.
There may not be any trading market for your notes; many factors affect the
trading and market value of your notes
Upon issuance, the notes of a series will not have an established trading
market. No assurance can be given that a trading market for your notes will ever
develop or be maintained if developed. In addition to the creditworthiness of
Allstate Life and the issuing trust, many factors affect the trading market for,
and trading value of, your notes. These factors include:
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o the complexity and volatility of the formula applicable to your notes;
o the method of calculating the principal, premium and interest in
respect of your notes;
o the time remaining to the maturity of your notes;
o the outstanding amount of the applicable series of notes;
o any redemption features of your notes;
o the amount of other debt securities linked to the formula applicable
to your notes; and
o the level, direction and volatility of market interest rates
generally.
There may be a limited number of buyers if you decide to sell your notes.
This may affect the price you receive for your notes or your ability to sell
your notes at all. In addition, notes that are designed for specific investment
objectives or strategies often experience a more limited trading market and more
price volatility than those not so designed. You should not purchase notes
unless you understand and know you can bear all of the investment risks
involving your notes.
Foreign currency notes are subject to exchange rate and exchange control risks
If you invest in notes that are denominated and/or payable in a currency
other than U.S. dollars, which are referred to in this prospectus supplement as
"foreign currency notes," you will be subject to significant risks not
associated with an investment in a debt security denominated and payable in U.S.
dollars. These risks include the possibility of material changes in the exchange
rate between U.S. dollars and the applicable foreign currency and the imposition
or modification of exchange controls by the applicable governments. The trusts
will have no control over the factors that generally affect these risks,
including economic, financial and political events and the supply and demand for
the applicable currencies. Moreover, if payments on your foreign currency notes
are determined by reference to a formula containing a multiplier or leverage
factor, the effect of any change in the exchange rates between the applicable
currencies will be magnified. In recent years, exchange rates between certain
currencies have been highly volatile and volatility between these currencies or
with other currencies may be expected in the future. Fluctuations between
currencies in the past are not necessarily indicative, however, of fluctuations
that may occur in the future. Depreciation of your payment currency would result
in a decrease (1) in the equivalent yield in U.S. dollars of your foreign
currency notes, (2) in the U.S. dollar equivalent value of the principal and any
premium payable at maturity or any earlier redemption of your foreign currency
notes and (3) generally, in the U.S. dollar equivalent market value of your
foreign currency notes.
Governmental exchange controls could affect exchange rates and the
availability of the payment currency for your foreign currency notes on a
required payment date. Even if there are no exchange controls, it is possible
that your payment currency will not be available on a required payment date for
circumstances beyond the control of the issuing trust. In these cases the
issuing trust will be allowed to satisfy the obligations in respect of your
foreign currency notes in U.S. dollars.
Ratings of the medium term note program described in this prospectus supplement
and the accompanying prospectus, the Allstate Life(R) CoreNotes(R) program and
each series of notes may not reflect all risks of an investment in the notes
Each series of notes will be rated by at least one nationally recognized
statistical rating organization. The ratings of such notes will primarily
reflect the financial strength of Allstate Life and will change in accordance
with the rating of Allstate Life's financial strength and with any change in the
priority status under Illinois law of funding agreements. Any rating is not a
recommendation to purchase, sell or hold any particular security, including the
notes. Such ratings do not comment as to market price or suitability for a
particular investor. In addition, there can be no assurance that a rating will
be maintained for any given period of time or that a rating will not be lowered
or withdrawn in its entirety. The ratings of the medium term note program
described in this prospectus supplement and the accompanying prospectus, the
Allstate Life(R) CoreNotes(R) program and each series of notes may not reflect
the potential impact of all risks related to structure and other factors on any
trading market for, or trading value of, your notes.
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An increase in market interest rates could result in a decrease in the value of
any notes bearing interest at a fixed rate
If market interest rates increase above the interest rate of notes bearing
interest at a fixed rate, such notes bearing interest at a fixed rate generally
decline in value because debt instruments of the same face value priced at
market interest rates will yield higher income. Consequently, if you purchase
fixed rate notes and market interest rates increase above the fixed interest
rate on the notes you have purchased, the market value of your notes may
decline. No assurance can be given regarding the future level of market interest
rates.
If you purchase discount notes, the amount payable to you upon early redemption,
repayment or acceleration of these notes may be less than the principal amount
(i.e., par) of the notes plus accrued but unpaid interest and premium, if any
If you purchase discount notes, the amount payable to you upon early
redemption, repayment or acceleration of these notes may be less than the
principal amount thereof plus accrued and unpaid interest. The amount payable
will be determined by the formula set forth in this prospectus supplement or the
applicable pricing supplement.
Risk Factors Relating to the Collateral
The funding agreements are unsecured obligations of Allstate Life. If the
funding agreements were not determined to be insurance contracts, they would be
accorded the same priority in an insolvency of Allstate Life as its other
general unsecured obligations
The primary assets of each trust will be one or more funding agreements,
and payments on the notes of a series will principally depend on payments under
each related funding agreement(s). In addition, each trust will grant a security
interest in, pledge and assign as collateral each funding agreement it acquires
with the proceeds from the offering of a series of notes together with the
related collateral to the indenture trustee, for the benefit of the holders of
the notes of such series and any other person for whose benefit the indenture
trustee is or will be holding the collateral, to secure the obligations under
that series of notes.
In the event of insolvency of an Illinois insurance company, claims against
the insurer's estate are prioritized pursuant to Section 5/205 of the Illinois
Insurance Code. Under Section 5/205(1)(d) of the Illinois Insurance Code, claims
by "policyholders, beneficiaries, and insureds, under insurance policies,
annuity contracts, and funding agreements" receive payment prior to any
distribution to general creditors not falling within any other priority class
under the Illinois Insurance Code. The funding agreements are unsecured
obligations of Allstate Life.
Lord, Bissell & Brook LLP, special Illinois insurance regulatory counsel of
Allstate Life, has opined that, subject to the limitations, qualifications and
assumptions set forth in its opinion letter, in a properly prepared and
presented case, (1) in a delinquency proceeding under Article XIII of the
Illinois Insurance Code, 215 ILCS Section 5/187 et seq. (the "Illinois
Liquidation Act"), the timely and properly filed claims of an owner under the
funding agreement (with the possible exception of claims for Additional Amounts,
as discussed below) would be entitled to distribution pari passu with claims
made by other policyholders, beneficiaries, and insureds under other insurance
policies, insurance contracts, annuities and funding agreements issued by
Allstate Life, and the claims of the Illinois Life and Health Insurance Guaranty
Association, and any similar organization in another state, in accordance with
Section 5/205(1)(d) of the Illinois Liquidation Act, and (2) an owner's claims
under the funding agreement should not be recharacterized as other than the
claims of a policyholder, beneficiary, or insured under an insurance policy,
insurance contract, annuity or funding agreement.
In the absence of controlling judicial precedents, the opinion of Lord,
Bissell & Brook LLP is based on a reasoned analysis of Illinois statutes, as
well as application of other states' judicial decisions involving similar or
analogous circumstances, and is subject to the limitations, qualifications and
assumptions set forth in its opinion letter. Investors should note that in the
event of the insolvency of an insurance company, however, the judicial
application of statutes governing the distribution of the insurer's general
assets has typically proceeded on a case-by-case basis.
Additional Amounts may be considered a separate payment obligation and may not
be subject to the same priority as other amounts claimed under the funding
agreements
If a funding agreement so provides, Allstate Life may be required to pay
Additional Amounts (as such term is defined therein) to the indenture trustee as
collateral assignee of the funding agreement. Although such payments could be
viewed as a claim under the funding agreements within the meaning of Section
5/205(1)(d), they may also be argued to be a separate payment obligation.
Therefore, while in a proceeding before a court of competent jurisdiction, the
court might find
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that a claim for an Additional Amount constitutes a claim under a funding
agreement, it also might find that such a claim is not a claim entitled to the
priority afforded by Section 5/205(1)(d). Lord, Bissell & Brook LLP has opined
that if a claim for an Additional Amount does not constitute a claim entitled to
the priority afforded by Section 5/205(1)(d), then in a properly prepared and
presented case any claim for an Additional Amount would be entitled to the same
priority as claims of general creditors of Allstate Life under Section
5/205(1)(g). Accordingly, in the event of the insolvency of Allstate Life, your
claim for any payments of Additional Amounts may be subordinated to claims for
other amounts under the applicable funding agreement.
Changes in Federal tax legislation could adversely affect Allstate Life's
business
Under the Internal Revenue Code of 1986, as amended (the "Code"), United
States Federal income tax payable by policyholders on investment earnings is
deferred during the accumulation period of certain life insurance and annuity
products. Thus, taxes, if any, are payable on income attributable to a
distribution under the contract for the year in which the distribution is made.
This favorable tax treatment may give certain of Allstate Life's products a
competitive advantage over other noninsurance products. On May 28, 2003,
President Bush signed the Jobs and Growth Tax Relief Reconciliation Act of 2003,
which reduces the federal income tax rates applicable to certain dividends and
capital gains realized by individuals. This legislation may lessen the
competitive advantage of certain of Allstate Life's products vis-a-vis other
investments that generate dividend and/or capital gain income. As a result,
demand for certain of Allstate Life's products that offer income tax deferral
may be negatively impacted. Additionally, Congress has from time to time
considered other legislation that would reduce or eliminate the benefits to
policyowners of the deferral of taxation on the accretion of value within
certain insurance products or otherwise affect the taxation of insurance
products and insurance companies. To the extent that the Code is revised to
reduce the tax deferred status of insurance products, or to reduce the taxation
of competing products, all life insurance companies, including Allstate Life,
could be adversely affected.
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ALLSTATE LIFE GLOBAL FUNDING TRUSTS
Each series of notes will be issued by a newly created separate and
distinct trust formed by Global Funding, the administrator and the Delaware
trustee pursuant to the filing of a certificate of trust and the execution of
the applicable trust agreement. Global Funding will be the sole beneficial owner
of each trust that is formed.
After formation, each trust will not engage in any activity other than:
o issuing and selling a single series of notes;
o immediately acquiring a funding note and immediately surrendering such
funding note for cancellation pursuant to its terms in exchange for
one or more funding agreement(s);
o acquiring, holding and maintaining the applicable funding
agreement(s);
o pledging, assigning as collateral and granting a security interest in
the applicable funding agreement(s) to the indenture trustee;
o making payments on the applicable series of notes; and
o engaging in other activities that are necessary, suitable or
convenient to accomplish the foregoing or are incidental to or
connected with those activities.
The principal executive offices of the trusts will be located at Allstate
Life Global Funding Trusts, c/o: AMACAR Pacific Corp., 6525 Morrison Boulevard,
Suite 318, Charlotte, North Carolina 28211. The telephone number will be (704)
365-0569. For more information about the trusts, see "Description of Allstate
Life Global Funding and the Trusts" in the accompanying prospectus.
ALLSTATE LIFE GLOBAL FUNDING
Global Funding is a special purpose statutory trust existing under the laws
of the State of Delaware. The primary purpose of Global Funding is to serve as
depositor for the programs.
Global Funding will not engage in any activity other than:
o beneficially owning the trusts;
o issuing one or more funding notes;
o acquiring one or more funding agreements from Allstate Life;
o pledging, assigning as collateral and granting a security interest in
the applicable funding agreement(s) to the funding note indenture
trustee;
o assigning absolutely the funding agreement(s) to, and depositing such
funding agreement(s) into, the trusts; and
o engaging in other activities that are necessary, suitable or
convenient to accomplish the foregoing or are incidental to or
connected with those activities.
The principal executive offices of Global Funding are located at Allstate
Life Global Funding, c/o: AMACAR Pacific Corp., 6525 Morrison Boulevard, Suite
318, Charlotte, North Carolina 28211. The telephone number is (704) 365-0569.
For more information about Global Funding, see "Description of Allstate Life
Global Funding and the Trusts" in the accompanying prospectus.
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ALLSTATE LIFE INSURANCE COMPANY
Allstate Life was organized in 1957 as a stock life insurance company under
the laws of the State of Illinois. It conducts substantially all of its life
insurance operations directly or through wholly owned United States
subsidiaries. It is a wholly owned subsidiary of Allstate Insurance Company
("AIC"), a stock property-liability insurance company organized under the laws
of the State of Illinois. All of the outstanding stock of AIC is owned by The
Allstate Corporation, a publicly owned holding company incorporated under the
laws of the State of Delaware.
The Allstate Corporation, together with its subsidiaries, is the second
largest personal property and casualty insurer in the United States on the basis
of 2004 statutory premiums earned. Widely known through the "You're In Good
Hands With Allstate(R)" slogan, The Allstate Corporation, through its
subsidiaries, provides insurance products to approximately 17 million households
and has approximately 14,100 exclusive agencies and financial specialists in the
United States and Canada. For more information about Allstate Life, see
"Description of Allstate Life Insurance Company" in the accompanying prospectus.
Allstate Life's principal executive offices are located at 3100 Sanders
Road, Northbrook, Illinois 60062 and its telephone number is (847) 402-5000.
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DESCRIPTION OF THE NOTES
This section provides a summary description of the material provisions of
the notes. Each series of notes will be issued pursuant to a separate indenture
(each, an "indenture") to be entered into among the issuing trust and the other
parties specified therein, including J.P. Morgan Trust Company, National
Association, or another entity specified therein, as the indenture trustee
(including, in each case, any successor, the "indenture trustee"). The
provisions of the notes are not restated in their entirety and you should read
the actual provisions set forth in the standard indenture terms filed as an
exhibit to the registration statement of which this prospectus supplement and
the accompanying prospectus form a part because those provisions, and not this
description, will define your rights as an owner of an interest in the notes of
a series. The terms and conditions of the notes described in this section will
apply to each series of notes, except that the specific terms of a series of
notes will be added in the applicable pricing supplement and each book-entry or
definitive note (each, a "note certificate") representing the notes of such
series. It is important for you to consider the information contained in this
prospectus supplement, the accompanying prospectus, the applicable indenture,
the applicable pricing supplement and the note certificates in making your
investment decision.
This section describes some technical concepts and occasionally contains
defined terms. You should refer to the standard indenture terms and the forms of
note certificates filed as exhibits to the registration statement to which this
prospectus supplement and the accompanying prospectus relate for the full
description of those concepts and complete definitions of those terms.
General
Indentures
Each trust will issue its series of notes subject to and entitled to the
benefits of a separate indenture. Each indenture will be subject to, qualified
under and governed by, the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"). The aggregate principal amount of notes that may be
authenticated and delivered under each indenture will be unlimited. For a
description of the indentures, see "Description of the Indentures" beginning on
page [ ] of the accompanying prospectus.
Collateral
Pursuant to each indenture, the issuing trust will pledge and collaterally
assign each funding agreement held by it to the indenture trustee for the
benefit of the holders of the notes issued by such trust and any other person
for whose benefit the indenture trustee is or will be holding the collateral (as
defined below) for such series of notes. Each series of notes will be secured by
a first priority perfected security interest in the "collateral" for such series
of notes in favor of the indenture trustee, for the benefit of the holders of
the notes of such series and any other person for whose benefit the indenture
trustee is or will be holding the collateral, which will consist of the right,
title and interest of the issuing trust in and to:
o the funding agreement(s) held by the issuing trust;
o all proceeds of the relevant funding agreement(s); and
o all books and records pertaining to the relevant funding agreement(s).
Ranking
The notes of a series will represent the unconditional, direct,
non-recourse and unsubordinated obligations of the issuing trust and will rank
equally among themselves. The notes of each series will represent the
obligations of the issuing trust only and will not represent the obligations of,
or interest in, any other trust, Global Funding, Allstate Life or any of their
respective affiliates.
Pricing Supplement
The pricing supplement relating to the offering of a series of notes will
describe, among other things, the following terms:
o the principal amount and specified currency for the notes;
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o whether the notes are:
o fixed rate notes;
o floating rate notes;
o amortizing notes, meaning that a portion or all of the principal
amount is payable prior to the stated maturity date in accordance
with a schedule or by application of a formula; and/or
o discount notes that do not bear any interest currently or bear
interest at a rate that is below market rates at the time of
issuance;
o the price at which the notes will be issued, which will be expressed
as a percentage of the aggregate principal amount or face amount;
o the original issue date on which the notes will be issued;
o the stated maturity date;
o if the notes are fixed rate notes, the rate per annum at which the
notes will bear any interest and the interest payment date frequency;
o if the notes are floating rate notes, relevant terms such as:
o the interest rate basis or interest rate bases;
o the initial interest rate;
o the interest reset period or the interest reset dates;
o the interest payment dates;
o the index maturity;
o any maximum interest rate;
o the minimum interest rate;
o the spread and/or spread multiplier; and
o any other terms relating to the particular method of calculating
the interest rate for the notes and whether and how the spread
and/or spread multiplier may be changed prior to the stated
maturity date;
o if the notes are amortizing notes, the terms for repayment prior to
the stated maturity date;
o whether the notes may be redeemed by the issuing trust, or repaid at
the option of the holders, prior to the stated maturity date and the
terms of their redemption or repayment, provided that any such
redemption or repayment will be accompanied by the simultaneous
redemption or repayment of the relevant funding agreement(s);
o any special United States federal income tax considerations relating
to the purchase, ownership and disposition of the notes; and
o any other terms of the notes provided in the accompanying prospectus
to be set forth in a pricing supplement or that are otherwise
consistent with the provisions of the indenture under which the notes
will be issued.
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The pricing supplement also may add, update, supplement or clarify
information in this prospectus supplement and the accompanying prospectus. The
form of pricing supplement is included in this prospectus supplement as Annex A.
Pricing Options
Notes that bear interest will either bear interest at fixed or floating
rates, as specified in the applicable pricing supplement. The trusts may also
issue discount notes and amortizing notes, as specified in the applicable
pricing supplement.
Maturities
Each series of notes will mature on a day between nine months and 30 years
from its date of issue (the "stated maturity date"), as specified in the
applicable pricing supplement, unless its principal (or, any installment of its
principal) becomes due and payable prior to the stated maturity date, whether,
as applicable, by the declaration of acceleration of maturity, notice of
redemption at the option of the issuing trust, notice of the registered holder's
option to elect repayment or otherwise (the stated maturity date or any date
prior to the stated maturity date on which the particular series of notes
becomes due and payable, as the case may be, is referred to as the "maturity
date" with respect to the principal of such series of notes repayable on that
date). Each series of notes will mature on or prior to the 30th anniversary of
the date of its original issuance. Each series of notes will have the same
maturity as the related funding agreement(s).
Currency
Unless otherwise specified in the applicable pricing supplement, the notes
of a series will be denominated in, and payments of principal, premium, if any,
and/or interest or other amounts, if any, in respect thereof will be made in,
United States dollars. Each series of notes also may be denominated in, and
payments of principal, premium, if any, and/or interest or other amounts, if
any, in respect thereof may be made in, one or more foreign currencies. See
"Special Provisions Relating to Foreign Currency Notes--Payment of Principal,
Premium, if any, and Interest, if any." The currency in which a particular
series of notes is denominated (or, if that currency is no longer legal tender
for the payment of public and private debts in the country issuing that currency
or, in the case of Euro, in the member states of the European Union that have
adopted the single currency in accordance with the Treaty Establishing the
European Community, as amended by the Treaty on European Union, the currency
which is then legal tender in the related country or in the adopting member
states of the European Union, as the case may be) is referred to as the
"specified currency" with respect to such series of notes.
You will be required to pay for your notes in the specified currency. At
the present time, there are limited facilities in the United States for the
conversion of United States dollars into foreign currencies and vice versa, and
commercial banks do not generally offer non-United States dollar checking or
savings account facilities in the United States. The Agent from or through which
a foreign currency note is purchased may be prepared to arrange for the
conversion of United States dollars into the specified currency in order to
enable you to pay for your foreign currency note, provided that you make a
request to that Agent on or prior to the fifth business day (as defined below)
preceding the date of delivery of the particular foreign currency note, or by
any other day determined by that Agent. Each conversion will be made by an Agent
on the terms and subject to the conditions, limitations and charges as that
Agent may from time to time establish in accordance with its regular foreign
exchange practices. You will be required to bear all costs of exchange in
respect of your foreign currency note. See "Special Provisions Relating to
Foreign Currency Notes."
The issuing trust may (if so specified in the applicable pricing
supplement) without the consent of the holders of any note or coupon,
redenominate all, but not less than all, of the notes of a series on or after
the date on which the member state of the European Union in whose national
currency such notes are denominated has become a participant member in the third
stage of the European economic and monetary union as more fully set out in the
applicable pricing supplement.
Form of Notes; Denominations
The issuing trust will issue each note of a series as a book-entry note
represented by one or more fully registered global securities or as a fully
registered definitive note. Unless otherwise specified in the applicable pricing
supplement, the minimum denominations of each note will be $1,000 and integral
multiples of $1,000 in excess thereof.
Listing of Notes
Unless otherwise specified in the applicable pricing supplement, a series
of notes will not be listed on any securities exchange.
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Payments
The issuing trust will make payments of principal of, and premium, if any,
and interest and other amounts due and owing, if any, on book-entry notes
through the indenture trustee to the account of the depositary or its nominee.
See "--Form of Notes" and "--Clearing Systems." In the case of definitive notes,
payments of principal of, and premium, if any, and interest and other amounts
due and owing, if any, will be made on the maturity date in immediately
available funds upon presentation and surrender thereof (and, in the case of any
repayment on an optional repayment date, upon submission of a duly completed
election form if and as required by the provisions described below) at the
office or agency maintained by the issuing trust for this purpose in the Borough
of Manhattan, The City of New York, currently the paying agency office of the
indenture trustee located at 4 New York Plaza, 1st Floor, New York, New York
10004. The issuing trust will make payments of interest and other amounts due
and owing, if any, on the maturity date of a definitive note to the person to
whom payment of the principal thereof and premium, if any, thereon shall be
made. The issuing trust will make payments of interest and other amounts due and
owing, if any, on a definitive note on any interest payment date (as defined
below) other than the maturity date by check mailed to the address of the
registered holder entitled thereto appearing in the applicable note register.
Notwithstanding the foregoing, the issuing trust will make payments of interest
and other amounts due and owing, if any, on any interest payment date other than
the maturity date to each registered holder of $10,000,000 (or, if the specified
currency is other than United States dollars, the equivalent thereof in the
particular specified currency) or more in aggregate principal amount of
definitive notes (whether having identical or different terms and provisions) by
wire transfer of immediately available funds if the applicable registered holder
has delivered appropriate wire transfer instructions in writing to the indenture
trustee not less than 15 days prior to the particular interest payment date. Any
wire transfer instructions received by the indenture trustee shall remain in
effect until revoked by the applicable registered holder. For special payment
terms applicable to foreign currency notes, see "Special Provisions Relating to
Foreign Currency Notes--Payment of Principal, Premium, if any, and Interest, if
any."
Business Day
"Business day" means any day, other than a Saturday or Sunday, that is
neither a legal holiday nor a day on which commercial banks are authorized or
required by law, regulation or executive order to close in The City of New York;
provided, however, that, with respect to foreign currency notes, the day must
also not be a day on which commercial banks are authorized or required by law,
regulation or executive order to close in the principal financial center (as
defined below) of the country issuing the specified currency (or, if the
specified currency is Euro, the day must also be a TARGET settlement day).
"TARGET settlement day" means a day on which the Trans-European Automated
Real-Time Gross Settlement Express Transfer (TARGET) System is open.
Principal Financial Center
"Principal financial center" means, as applicable:
o the capital city of the country issuing the specified currency; or
o the capital city of the country to which the LIBOR currency relates;
provided, however, that with respect to United States dollars, Australian
dollars, Canadian dollars, Euro, South African rands and Swiss francs, the
"principal financial center" shall be The City of New York, Sydney, Toronto,
London (solely in the case of the LIBOR currency), Johannesburg and Zurich,
respectively.
Registration and Transfer of Notes
Book-entry notes may be transferred or exchanged only through the clearing
systems (described below). Registration of transfer or exchange of definitive
notes of a series will be made at the office or agency maintained by the issuing
trust for this purpose in the Borough of Manhattan, The City of New York, which
is currently the corporate trust office of the indenture trustee. No service
charge will be imposed for any such registration of transfer or exchange of
notes, but the issuing trust may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection therewith
(other than certain exchanges not involving any transfer).
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Withholding Tax and Payment of Additional Amounts
All amounts due in respect of the notes will be made without withholding or
deduction for or on account of any present or future taxes, duties, levies,
assessments or other governmental charges of whatever nature imposed or levied
by or on behalf of any governmental authority in the United States having the
power to tax payments on the notes unless the withholding or deduction is
required by law.
Unless otherwise specified in the applicable pricing supplement, a trust
will not pay any additional amounts ("additional amounts") to holders of any
series of notes in the event that any withholding or deduction is so required by
law, regulation or official interpretation thereof, and the imposition of a
requirement to make any such withholding or deduction will not give rise to any
independent right or obligation to redeem the notes of such series.
If a trust so specifies in the applicable pricing supplement, such trust
will pay, or cause to be paid, additional amounts to non-U.S. Holders (as
defined in "United States Federal Income Tax Considerations") to compensate for
any withholding or deduction for or on account of any present or future taxes,
duties, levies, assessments or governmental charges of whatever nature imposed
or levied on payments on the notes of the relevant series by or on behalf of any
governmental authority in the United States having the power to tax, so that the
net amount received by the holders of the notes of such series, after giving
effect to such withholding or deduction, whether or not currently payable, will
equal the amount that would have been received under the notes of such series
were no such deduction or withholding required; provided that no such additional
amounts shall be required for or on account of:
o any tax, duty, levy, assessment or other governmental charge imposed
which would not have been imposed but for a holder or beneficial owner
of one or more of the notes of such series
o having any present or former connection with the United States,
including, without limitation, being or having been a citizen or
resident thereof, or having been present, having been
incorporated in, having engaged in a trade or business or having
(or having had) a permanent establishment or principal office
therein;
o being a controlled foreign corporation (within the meaning of
Section 957(a) of the Code) related (within the meaning of Code
Section 864(d)(4)) to Allstate Life;
o being a bank for United States federal income tax purposes whose
receipt of interest on the notes is described in Section
881(c)(3)(A) of the Code;
o being an actual or constructive owner of 10% or more of the total
combined voting power of all classes of stock of Allstate Life
entitled to vote within the meaning of Section 871(h)(3) of the
Code and Treasury Regulations promulgated thereunder; or
o being subject to backup withholding as of the date of the
purchase by the holder of the notes;
o any tax, duty, levy, assessment or other governmental charge which
would not have been imposed but for the presentation of any note of
the applicable series (where presentation is required) for payment on
a date more than 30 days after the date on which such payment becomes
due and payable or the date on which payment is duly provided for,
whichever occurs later;
o any tax, duty, levy, assessment or other governmental charge which is
imposed or withheld solely by reason of the failure of the beneficial
owner or a holder of notes of a series to comply with certification,
identification or information reporting requirements concerning the
nationality, residence, identity or connection with the United States
of the beneficial owner or a holder of notes of such series, if
compliance is required by statute, by regulation of the United States
Treasury Department, judicial or administrative interpretation, other
law or by an applicable income tax treaty to which the United States
is a party as a condition to exemption from such tax, duty, levy,
assessment or other governmental charge;
o any inheritance, gift, estate, personal property, sales, transfer or
similar tax, duty, levy, assessment, or similar governmental charge;
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o any tax, duty, levy, assessment, or other governmental charge that is
payable otherwise than by withholding from payments in respect of the
notes of such series;
o any tax, duty, levy, assessment or governmental charge imposed by
reason of payments on the notes of such series being treated as
contingent interest described in Section 871(h)(4) of the Code
provided such treatment was described in the applicable pricing
supplement;
o any tax, duty, levy, assessment or governmental charge that would not
have been imposed but for an election by the holder of the notes of
such series, the effect of which is to make one or more payments in
respect of the notes of such series subject to United States federal
income tax or withholding tax provisions; or
o any combination of the items described in the bullets above.
The European Union has adopted a directive regarding the taxation of
savings income. Effective as of July 1, 2005, member states are required to
provide to the tax authorities of other member states details of payments of
interest and other similar income paid by a person to an individual in another
member state, except that Austria, Belgium and Luxembourg will instead impose a
withholding system for a transitional period unless during such period they
elect otherwise. For the avoidance of doubt, should any deduction or withholding
on account of tax be required to be made, or be made, pursuant to such
directive, no additional amounts shall be payable or paid by or on behalf of a
trust.
Security; Non-Recourse Obligations
The notes of a series will represent the obligations of the issuing trust
only and will not represent the obligations of, or interest in, any other trust,
Global Funding, Allstate Life or any of their respective affiliates. The notes
of a series will not be guaranteed by any person or entity. The obligations
under each series of notes will be secured by all of the rights and title of the
issuing trust in one or more funding agreements issued by Allstate Life and
other rights and assets included in the applicable collateral held in the
issuing trust.
The issuing trust will, from time to time and upon advice of counsel, at
the trust's expense, execute, deliver, file and record any statement,
assignment, instrument, document, agreement or other paper and take any other
action, (including, without limitation, any filings of financing or continuation
statements) that from time to time may be necessary or desirable, or that the
indenture trustee may reasonably request, in order to create, preserve, perfect,
confirm or validate a security interest or to enable the holder of its series of
notes to obtain the full benefits of the applicable indenture, or to enable the
indenture trustee to exercise and enforce any of its rights, powers and remedies
under the indenture with respect to the applicable collateral. To the extent
permitted by applicable law, the issuing trust authorizes the indenture trustee
to execute and file financing statements or continuation statements without the
trust's signature appearing thereon and will agree that a carbon, photographic,
photostatic or other reproduction of the applicable indenture or of a financing
statement is sufficient as a financing statement. The issuing trust shall pay
the costs of, or incidental to, any recording or filing of any financing or
continuation statements concerning any of the applicable collateral.
Since Allstate Life will be the sole obligor under the funding agreements,
the ability of a trust to meet its obligations, and your ability to receive
payments from such trust, with respect to a particular series of notes, will be
principally dependent upon Allstate Life's ability to perform its obligations
under each applicable funding agreement held by the issuing trust. Despite this,
you will have no direct contractual rights against Allstate Life under any such
funding agreement. Pursuant to the terms of each funding agreement, recourse
rights to Allstate Life will belong to the issuing trust, its successors and
permitted assignees. In connection with the offering and sale of a series of
notes, the issuing trust will pledge, collaterally assign and grant a security
interest in the collateral for such series of notes to the indenture trustee for
the benefit of the holders of the applicable series of notes and any other
person for whose benefit the indenture trustee is or will be holding the
collateral. Accordingly, recourse to Allstate Life under each such funding
agreement will be enforceable only by the indenture trustee as a secured party
for the benefit of holders of such series of notes and any other person for
whose benefit the indenture trustee is or will be holding the collateral.
Nonetheless, since Allstate Life is a registrant, purchasers of notes may
be able to proceed directly against Allstate Life to enforce their rights under
the Federal securities laws and their rights under the Federal securities laws
will be no different than if they purchased the underlying funding agreements
directly from Allstate Life.
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Redemption, Repayment and Repurchase of Notes
Unless otherwise specified in the applicable pricing supplement and
provided for in the applicable funding agreement(s), and except as provided with
respect to an optional tax event redemption, the notes of a series will not be
redeemable, except at the applicable maturity date, when all notes of such
series will be redeemed.
Optional Redemption by the Issuer; No Sinking Fund
If an initial redemption date is specified in the applicable pricing
supplement and provided for in the applicable funding agreement(s), the issuing
trust may redeem the particular series of notes prior to its stated maturity
date at its option on any date on or after that initial redemption date in whole
or from time to time in part in increments of $1,000 or any other integral
multiple of an authorized denomination specified in the applicable pricing
supplement (provided that any remaining principal amount thereof shall be at
least $1,000 or other minimum authorized denomination applicable thereto), at
the applicable redemption price (as defined below), together with unpaid
interest accrued thereon to the date of redemption. "Redemption price," with
respect to a series of notes, means an amount equal to the initial redemption
percentage specified in the applicable pricing supplement (as adjusted by the
annual redemption percentage reduction, if applicable) multiplied by the unpaid
principal amount thereof to be redeemed. The initial redemption percentage, if
any, applicable to a series of notes shall decline at each anniversary of the
initial redemption date by an amount equal to the applicable annual redemption
percentage reduction, if any, until the redemption price is equal to 100% of the
unpaid amount thereof to be redeemed. For a discussion of the redemption of
discount notes, see "--Discount Notes."
No series of notes will be subject to, or entitled to the benefit of, any
sinking fund unless otherwise indicated in the applicable pricing supplement.
The applicable pricing supplement may provide that the notes of a series
may be redeemed by the issuing trust and the terms of such redemption. If so
specified, the issuing trust will give a notice of redemption to each holder of
the notes to be redeemed not less than 30 days nor more than 60 days prior to
the date fixed for redemption.
Each trust may issue a series of notes which may be redeemed by the issuing
trust when 25% or more of the original principal balance of such notes is
outstanding, which are referred to herein as "callable" notes. If a trust issues
a series of callable notes, such trust will include the word "callable" in the
title of such series of notes in the applicable pricing supplement. Unless
otherwise specified in the applicable pricing supplement, such series of notes
will otherwise be subject to the redemption provisions described above.
Repayment at Option of Holder
A series of notes may permit, upon the terms and subject to the limitations
set forth in the applicable pricing supplement, redemption at the option of the
holder or holders of the notes of such series. If one or more series of notes
provides for such optional redemption, the persons designated in the applicable
pricing supplement may require the issuing trust to repay the notes of such
series prior to their stated maturity date in whole or from time to time in part
in increments of $1,000 or any other integral multiple of an authorized
denomination specified in the applicable pricing supplement (provided that any
remaining principal amount thereof shall be at least $1,000 or other minimum
authorized denomination applicable thereto), at a repayment price equal to 100%
of the unpaid principal amount thereof to be repaid, together with unpaid
interest accrued thereon to the date of repayment and any other amounts then due
and owing. Exercise of the repayment option will be irrevocable. For a
discussion of the repayment of discount notes, see "--Discount Notes."
None of the trusts will issue notes that may be repaid at the option of the
holders prior to the stated maturity date if such issuance would cause the
relevant trust to fail to satisfy the applicable requirements for exemption
under Rule 3a-7 under the Investment Company Act of 1940, as amended, and all
applicable rules, regulations and interpretations thereunder.
Only DTC may exercise a repayment option in respect of notes of a series
issued in book-entry form. Accordingly, beneficial owners of notes that desire
to exercise their repayment option, if any, with respect to all or any portion
of such notes, must instruct the participant through which they own their
interest to direct DTC to exercise the repayment option on their behalf by
delivering the duly completed election form to the indenture trustee. In order
to ensure that the election form is received by the indenture trustee on a
particular day, the applicable beneficial owner must so instruct the participant
through which it owns its interest before such participant's deadline for
accepting instructions for that day. Participants may have different deadlines
for accepting instructions from their customers. Accordingly, a beneficial owner
should consult the participant through which it owns its interest in the notes
for the participant's deadline for receiving payment instructions. In
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addition, at the time such instructions are given, each such beneficial owner
will cause such participant to transfer such beneficial owner's interest in the
notes issued in book-entry form, on DTC's records, to the indenture trustee.
Unless otherwise specified in the applicable pricing supplement, the notes
of a series will not provide any holder with the option to have the issuing
trust repay the note on a date or dates specified prior to its maturity date.
Repurchase of Notes
Each trust may purchase some or all notes of a series issued by such trust
in the open market or otherwise at any time, and from time to time, with the
prior written consent of Allstate Life as to both the making of such purchase
and the purchase price to be paid for such notes. If Allstate Life, in its sole
discretion, consents to such purchase of notes by the issuing trust, then such
trust and other parties to the indenture will be obligated to take such actions
as may be necessary or desirable to effect the prepayment of such portion, or
the entirety, of the current Principal Amount (as defined in the applicable
funding agreement) under each applicable funding agreement as may be necessary
to provide for the payment of the purchase price for such notes. Upon such
payment, the Principal Amount under each funding agreement shall be reduced (1)
with respect to any purchase of notes that bear interest at fixed or floating
rates, by an amount equal to the aggregate principal amount of the notes as
purchased (or the portion thereof applicable to such funding agreement) and (2)
with respect to any purchase of notes other than notes that bear interest at
fixed or floating rates, by an amount to be agreed between the issuing trust and
Allstate Life to reflect such prepayment under the funding agreement(s).
Optional Tax Event Redemption
If under the applicable pricing supplement the issuing trust is required at
any time to pay additional amounts or if such trust is obligated to withhold or
deduct any United States taxes with respect to any payment under the notes of
the relevant series or if there is a material probability that the issuing trust
will become obligated to withhold or deduct any such United States taxes or
otherwise pay additional amounts (in the opinion of independent legal counsel
selected by Allstate Life), in each case pursuant to any change in or amendment
to any United States tax laws (or any regulations or rulings thereunder) or any
change in position of the Internal Revenue Service regarding the application or
interpretation thereof (including, but not limited to, Allstate Life's or the
issuing trust's receipt of a written adjustment from the Internal Revenue
Service in connection with an audit) (a "tax event"), then Allstate Life,
pursuant to the terms of the relevant funding agreement(s), may terminate the
relevant funding agreement(s). If Allstate Life terminates the relevant funding
agreement(s), the issuing trust will redeem the particular series of notes for
the outstanding principal of and any accrued but unpaid interest and any other
amounts then due and owing on its series of notes, or such other amount which is
specified in the pricing supplement for such series of notes by giving not more
than 75 days nor less than 30 days prior written notice to the holders of such
series of notes, provided that no such notice of termination may be given
earlier than 90 days prior to the earliest day when the issuing trust would
become obligated to pay such additional amounts were a payment in respect of the
notes of such series then due.
Interest
Each interest-bearing series of notes will bear interest from its date of
issue at the rate per annum, in the case of notes that bear interest at fixed
rates, or pursuant to the interest rate formula, in the case of notes that bear
interest at floating rates, in each case as specified in the applicable pricing
supplement, until the principal thereof is paid. The issuing trust will make
interest payments in respect of the relevant series of notes in an amount equal
to the interest accrued from and including the immediately preceding interest
payment date in respect of which interest has been paid or from and including
the date of issue, if no interest has been paid, to but excluding the applicable
interest payment date or the maturity date, as the case may be (each, an
"interest period").
Interest on each series of notes will be payable in arrears on each
interest payment date and on the maturity date. The first payment of interest on
any series of notes originally issued between a regular interest record date (as
defined below) and the related interest payment date will be made on the
interest payment date immediately following the next succeeding regular interest
record date to the registered holder on the next succeeding regular interest
record date. The "regular interest record date" shall be the fifteenth calendar
day, whether or not a business day, immediately preceding the related interest
payment date.
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Fixed Rate Notes
Interest on each series of notes that bears interest at fixed rates will be
payable on the date(s) specified in the applicable pricing supplement (each, an
"interest payment date" with respect to a series of notes that bears interest at
fixed rates) and on the maturity date. Interest on each series of notes that
bears interest at fixed rates will be computed on the basis of a 360-day year of
twelve 30-day months.
Unless otherwise specified in the applicable pricing supplement, the
interest payment dates for fixed rate notes of a series will be as follows:
Interest Payment Frequency Interest Payment Dates
-------------------------------------- ----------------------------------------------------
Monthly Fifteenth day of each calendar month, beginning in
the first calendar month following the date such
series of notes was issued.
Quarterly Fifteenth day of every third month, beginning in the
third calendar month following the date such
series of notes was issued.
Semiannual Fifteenth day of every sixth month, beginning in the
sixth calendar month following the date such
series of notes was issued.
Annual Fifteenth day of every twelfth month, beginning in
the twelfth calendar month following the date such
series of notes was issued.
Unless otherwise provided in the applicable pricing supplement, any
interest payment date or the maturity date of a series of notes that bears
interest at fixed rates falls on a day that is not a business day, the issuing
trust will make the required payment of principal, premium, if any, and/or
interest or other amounts on the next succeeding business day, and no additional
interest will accrue in respect of the payment made on that next succeeding
business day.
Interest rates that the issuing trust offers on its fixed rate notes may
differ depending upon, among other factors, the aggregate principal amount of
notes purchased in any single transaction. Notes with different variable terms,
other than interest rates, may also be offered concurrently by other trusts to
different investors. Other trusts may change interest rates or formulas and
other terms of notes from time to time, but no change of terms will affect any
note any other trust has previously issued or as to which any other trust has
accepted an offer to purchase.
Floating Rate Notes
Interest on each series of notes that bears interest at floating rates will
be determined by reference to the applicable interest rate basis or interest
rate bases, which may, as described below, include:
o the CD Rate,
o the CMT Rate,
o the Commercial Paper Rate,
o the Constant Maturity Swap Rate,
o the Eleventh District Cost of Funds Rate,
o the Federal Funds Open Rate,
o the Federal Funds Rate,
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o LIBOR,
o EURIBOR,
o the Prime Rate, or
o the Treasury Rate.
The applicable pricing supplement will specify certain terms of the
particular series of notes that bears interest at floating rates, including:
o whether the note that bears interest at floating rates is:
o a "Regular Floating Rate Note,"
o a "Floating Rate/Fixed Rate Note" or
o an "Inverse Floating Rate Note,"
o the fixed rate commencement date, if applicable,
o fixed interest rate, if applicable,
o interest rate basis or bases,
o initial interest rate, if any,
o interest reset dates,
o interest payment dates,
o index maturity,
o maximum interest rate and/or minimum interest rate, if any,
o spread and/or spread multiplier, or
o if one or more of the applicable interest rate bases is LIBOR, the
LIBOR currency and LIBOR page.
The rate derived from the applicable interest rate basis will be determined
in accordance with the related provisions below. The interest rate in effect on
each day will be based on:
o if that day is an interest reset date, the rate determined as of the
interest determination date (as defined below) immediately preceding
that interest reset date, or
o if that day is not an interest reset date, the rate determined as of
the interest determination date immediately preceding the most recent
interest reset date.
The "spread" is the number of basis points (one one-hundredth of a
percentage point) specified in the applicable pricing supplement to be added to
or subtracted from the related interest rate basis or bases applicable to a
series of notes that bears interest at floating rates. The "spread multiplier"
is the percentage specified in the applicable pricing supplement of the related
interest rate basis or bases applicable to a series of notes that bears interest
at floating rates by which the interest rate basis or bases will be multiplied
to determine the applicable interest rate. The "index maturity" is the period to
maturity of the instrument or obligation with respect to which the related
interest rate basis or bases will be calculated.
S-29
Regular Floating Rate Notes
Unless a series of notes that bears interest at floating rates is
designated as a series of Floating Rate/Fixed Rate notes or a series of Inverse
Floating Rate notes, or as having an addendum attached or having
other/additional provisions apply, in each case relating to a different interest
rate formula, such series of notes that bears interest at floating rates will be
a series of Regular Floating Rate notes and will bear interest at the rate
determined by reference to the applicable interest rate basis or bases:
o multiplied by the applicable spread multiplier, if any; and/or
o plus or minus the applicable spread, if any.
Commencing on the first interest reset date, as specified in the relevant
pricing supplement, the rate at which interest on a series of Regular Floating
Rate notes is payable will be reset as of each interest reset date; provided,
however, that the interest rate in effect for the period, if any, from the date
of issue to the first interest reset date will be the initial interest rate.
Floating Rate/Fixed Rate Notes
If a series of notes that bears interest at floating rates is designated as
a series of Floating Rate/Fixed Rate notes, such series of notes that bears
interest at floating rates will bear interest at the rate determined by
reference to the applicable interest rate basis or bases:
o multiplied by the applicable spread multiplier, if any; and/or
o plus or minus the applicable spread, if any.
Commencing on the first interest reset date, the rate at which interest on
a series of Floating Rate/Fixed Rate notes is payable will be reset as of each
interest reset date; provided, however, that:
o the interest rate in effect for the period, if any, from the date of
issue to the first interest reset date will be the initial interest
rate, as specified in the relevant pricing supplement; and
o the interest rate in effect commencing on the fixed rate commencement
date will be the fixed interest rate, if specified in the applicable
pricing supplement, or, if not so specified, the interest rate in
effect on the day immediately preceding the fixed rate commencement
date.
Inverse Floating Rate Notes
If a series of notes that bears interest at floating rates is designated as
a series of Inverse Floating Rate notes, such series of notes that bears
interest at floating rates will bear interest at the fixed interest rate minus
the rate determined by reference to the applicable interest rate basis or bases:
o multiplied by the applicable spread multiplier, if any; and/or
o plus or minus the applicable spread, if any.
provided, however, that interest on a series of Inverse Floating Rate notes will
not be less than zero. Commencing on the first interest reset date, the rate at
which interest on a series of Inverse Floating Rate notes is payable will be
reset as of each interest reset date; provided, further, that the interest rate
in effect for the period, if any, from the date of issue to the first interest
reset date will be the initial interest rate.
Interest Reset Dates
The applicable pricing supplement will specify the dates on which the rate
of interest on a series of notes that bears interest at floating rates will be
reset (each, an "interest reset date"), and the period between interest reset
dates will be the "interest reset period." Unless otherwise specified in the
applicable pricing supplement, the interest reset dates will be, in the case of
a series of notes that bears interest at floating rates which reset:
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o daily--each business day;
o weekly--the Wednesday of each week, with the exception of weekly reset
series of notes that bears interest at floating rates as to which the
Treasury Rate is an applicable interest rate basis, which will reset
the Tuesday of each week;
o monthly--the third Wednesday of each month, with the exception of
monthly reset series of notes that bears interest at floating rates as
to which the Eleventh District Cost of Funds Rate is an applicable
interest rate basis, which will reset on the first calendar day of the
month;
o quarterly--the third Wednesday of every third calendar month,
beginning in the third calendar month following the month in which the
note was issued;
o semiannually--the third Wednesday of the two months specified in the
applicable pricing supplement; and
o annually--the third Wednesday of the month specified in the applicable
pricing supplement; provided, however, that, with respect to any
series of Floating Rate/Fixed Rate notes, the rate of interest thereon
will not reset after the particular fixed rate commencement date.
Unless otherwise provided in the applicable pricing supplement, if any
interest reset date for any series of notes that bears interest at floating
rates would otherwise be a day that is not a business day, the particular
interest reset date will be postponed to the next succeeding business day,
except that in the case of a series of notes that bears interest at floating
rates as to which LIBOR is an applicable interest rate basis and that business
day falls in the next succeeding calendar month, the particular interest reset
date will be the immediately preceding business day.
Interest Determination Dates
The interest rate applicable to a series of notes that bears interest at
floating rates for an interest reset period commencing on the related interest
reset date will be determined by reference to the applicable interest rate basis
as of the particular "interest determination date," which will be:
o with respect to the Federal Funds Open Rate--the related interest
reset date;
o with respect to the Federal Funds Rate and the Prime Rate--the
business day immediately preceding the related interest reset date;
o with respect to the CD Rate, the Commercial Paper Rate, and the CMT
Rate--the second business day preceding the related interest reset
date;
o with respect to the Constant Maturity Swap Rate--the second U.S.
Government Securities business day (as defined below) preceding the
related interest reset date; provided, however, that if, after
attempting to determine the Constant Maturity Swap Rate (as described
below), such rate is not determinable for a particular interest
determination date (the "original interest determination date"), then
such interest determination date shall be the first U.S. Government
Securities business day preceding the original interest determination
date for which the Constant Maturity Swap Rate can be determined as
described below;
o with respect to the Eleventh District Cost of Funds Rate--the last
working day of the month immediately preceding the related interest
reset date on which the Federal Home Loan Bank of San Francisco
publishes the Eleventh District Index (as defined below);
o with respect to LIBOR--the second London banking day (as defined
below) preceding the related interest reset date, unless the
applicable LIBOR currency (as defined below) is pounds sterling, in
which case the interest determination date will be the related
interest reset date, or the applicable LIBOR currency is Euro, in
which case the interest determination date will be the second TARGET
settlement date preceding the applicable interest reset date;
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o with respect to EURIBOR--the second TARGET settlement date preceding
the applicable interest reset date; and
o with respect to the Treasury Rate--the day in the week in which the
related interest reset date falls on which day Treasury Bills (as
defined below) are normally auctioned (i.e., Treasury Bills are
normally sold at auction on Monday of each week, unless that day is a
legal holiday, in which case the auction is normally held on the
following Tuesday, except that the auction may be held on the
preceding Friday); provided, however, that if an auction is held on
the Friday of the week preceding the related interest reset date, the
interest determination date will be the preceding Friday.
Unless otherwise provided in the applicable pricing supplement, the
interest determination date pertaining to a series of notes that bears interest
at floating rates the interest rate of which is determined with reference to two
or more interest rate bases will be the latest business day which is at least
two business days before the related interest reset date for the applicable note
that bears interest at floating rates on which each interest reset basis is
determinable.
Calculation Dates
The indenture trustee will be the "calculation agent" for a series of notes
unless otherwise specified in the applicable pricing supplement. The interest
rate applicable to each interest reset period will be determined by the
calculation agent on or prior to the calculation date (as defined below), except
with respect to LIBOR and the Eleventh District Cost of Funds Rate, which will
be determined on the particular interest determination date. Upon request of the
registered holder of a series of notes that bears interest at floating rates,
the calculation agent will disclose the interest rate then in effect and, if
determined, the interest rate that will become effective as a result of a
determination made for the next succeeding interest reset date with respect to
the particular series of notes that bears interest at floating rates. The
"calculation date," if applicable, pertaining to any interest determination date
will be the earlier of:
o the tenth calendar day after the particular interest determination
date or, if such day is not a business day, the next succeeding
business day; or
o the business day immediately preceding the applicable interest payment
date or the maturity date, as the case may be.
Maximum and Minimum Interest Rates
A series of notes that bears interest at floating rates may also have
either or both of the following if specified in the applicable pricing
supplement:
o a maximum numerical limitation, or ceiling, that may accrue during any
interest reset period (a "maximum interest rate"); and
o a minimum numerical limitation, or floor, that may accrue during any
interest reset period (a "minimum interest rate").
In addition to any maximum interest rate that may apply to a series of
notes that bears interest at floating rates, the interest rate on a series of
notes that bears interest at floating rates will in no event be higher than the
maximum rate permitted by New York law, as the same may be modified by United
States law of general application.
Interest Payments
Unless otherwise specified in the applicable pricing supplement or in this
prospectus supplement, interest on each series of notes that bears interest at
floating rates will be payable on the date(s) specified in the accompanying
prospectus under the caption "Description of the Notes--Payment of Interest"
(each, an "interest payment date" with respect to such series of notes that
bears interest at floating rates). Unless the applicable pricing supplement
indicates otherwise, the interest payment dates will be, in the case of a series
of notes that bears interest at floating rates which reset:
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o daily, weekly or monthly--the third Wednesday of each month or on the
third Wednesday of every third calendar month, beginning in the third
calendar month following the date the applicable series of notes was
issued;
o quarterly--the third Wednesday of every third calendar month,
beginning in the third calendar month following the date the
applicable series of notes was issued;
o semiannually--the third Wednesday of the two months of each year
specified in the applicable pricing supplement; and
o annually--the third Wednesday of the month of each year specified in
the applicable pricing supplement.
In addition, the maturity date will also be an interest payment date.
Unless otherwise provided in the applicable pricing supplement, if any
interest payment date other than the maturity date for any series of notes that
bears interest at floating rates would otherwise be a day that is not a business
day, such interest payment date will be postponed to the next succeeding
business day, except that in the case of a series of notes that bears interest
at floating rates as to which LIBOR is an applicable interest rate basis and
that business day falls in the next succeeding calendar month, the particular
interest payment date will be the immediately preceding business day. If the
maturity date of a series of notes that bears interest at floating rates falls
on a day that is not a business day, the issuing trust will make the required
payment of principal, premium, if any, and interest or other amounts on the next
succeeding business day, and no additional interest will accrue in respect of
the payment made on that next succeeding business day.
All percentages resulting from any calculation on notes that bear interest
at floating rates will be rounded to the nearest one hundred-thousandth of a
percentage point, with five one-millionths of a percentage point rounded
upwards. For example, 9.876545% (or .09876545) would be rounded to 9.87655% (or
..0987655). All dollar amounts used in or resulting from any calculation on notes
that bear interest at floating rates will be rounded, in the case of United
States dollars, to the nearest cent or, in the case of a foreign currency, to
the nearest unit (with one-half cent or unit being rounded upwards).
With respect to each series of notes that bears interest at floating rates,
accrued interest is calculated by multiplying the principal amount of such
series of notes that bears interest at floating rates by an accrued interest
factor. The accrued interest factor is computed by adding the interest factor
calculated for each day in the particular interest period. The interest factor
for each day will be computed by dividing the interest rate applicable to such
day by 360, in the case of a series of notes that bears interest at floating
rates as to which the CD Rate, the Commercial Paper Rate, the Eleventh District
Cost of Funds Rate, the Federal Funds Open Rate, the Federal Funds Rate, LIBOR,
EURIBOR or the Prime Rate is an applicable interest rate basis, or by the actual
number of days in the year, in the case of a series of notes that bears interest
at floating rates as to which the CMT Rate or the Treasury Rate is an applicable
interest rate basis. In the case of a series of notes that bears interest at
floating rates as to which the Constant Maturity Swap Rate is the interest rate
basis, the interest factor will be computed by dividing the number of days in
the interest period by 360 (the number of days to be calculated on the basis of
a year of 360 days with 12 30-day months (unless (i) the last day of the
interest period is the 31st day of a month but the first day of the interest
period is a day other than the 30th or 31st day of a month, in which case the
month that includes that last day shall not be considered to be shortened to a
30-day month, or (ii) the last day of the interest period is the last day of the
month of February, in which case the month of February shall not be considered
to be lengthened to a 30-day month)). The interest factor for a series of notes
that bears interest at floating rates as to which the interest rate is
calculated with reference to two or more interest rate bases will be calculated
in each period in the same manner as if only the applicable interest rate basis
specified in the applicable pricing supplement applied.
The calculation agent shall determine the rate derived from each interest
rate basis in accordance with the following provisions.
CD Rate
"CD Rate" means:
(1) the rate on the particular interest determination date for negotiable
United States dollar certificates of deposit having the index maturity
specified in the applicable pricing supplement as published in
H.15(519) (as defined below) under the caption "CDs (secondary
market);" or
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(2) if the rate referred to in clause (1) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate on
the particular interest determination date for negotiable United
States dollar certificates of deposit of the particular index maturity
as published in H.15 Daily Update (as defined below), or other
recognized electronic source used for the purpose of displaying the
applicable rate, under the caption "CDs (secondary market);" or
(3) if the rate referred to in clause (2) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate on
the particular interest determination date calculated by the
calculation agent as the arithmetic mean of the secondary market
offered rates as of 10:00 A.M., New York City time, on that interest
determination date, of three leading non-bank dealers in negotiable
United States dollar certificates of deposit in The City of New York
(which may include the Agents or their affiliates) selected by the
calculation agent for negotiable United States dollar certificates of
deposit of major United States money market banks for negotiable
United States certificates of deposit with a remaining maturity
closest to the particular index maturity in an amount that is
representative for a single transaction in that market at that time;
or
(4) if the dealers so selected by the calculation agent are not quoting as
mentioned in clause (3), the CD Rate in effect on the particular
interest determination date; provided that if no CD Rate is then in
effect, the interest rate that will be effective as of the next
interest reset date will be the initial interest rate.
"H.15(519)" means the weekly statistical release designated as H.15(519),
or any successor publication, published by the Board of Governors of the Federal
Reserve System.
"H.15 Daily Update" means the daily update of H.15(519), available through
the world-wide-web site of the Board of Governors of the Federal Reserve System
at http://www.federalreserve.gov/releases/H15/update, or any successor site or
publication.
CMT Rate
"CMT Rate" means:
(1) if CMT Moneyline Telerate Page 7051 is specified in the applicable
pricing supplement:
(a) the percentage equal to the yield for United States Treasury
securities at "constant maturity" having the index maturity
specified in the applicable pricing supplement as published in
H.15(519) under the caption "Treasury Constant Maturities," as
the yield is displayed on Moneyline Telerate (or any successor
service) on page 7051 (or any other page as may replace the
specified page on that service) ("Moneyline Telerate Page 7051"),
for the particular interest determination date; or
(b) if the rate referred to in clause (a) does not so appear on
Moneyline Telerate Page 7051, the percentage equal to the yield
for United States Treasury securities at "constant maturity"
having the particular index maturity and for the particular
interest determination date as published in H.15(519) under the
caption "Treasury Constant Maturities;" or
(c) if the rate referred to in clause (b) does not so appear in
H.15(519), the rate on the particular interest determination date
for the period of the particular index maturity as may then be
published by either the Federal Reserve System Board of Governors
or the United States Department of the Treasury that the
calculation agent determines to be comparable to the rate which
would otherwise have been published in H.15(519); or
(d) if the rate referred to in clause (c) is not so published, the
rate on the particular interest determination date calculated by
the calculation agent as a yield to maturity based on the
arithmetic mean of the secondary market bid prices at
approximately 3:30 P.M., New York City time, on that interest
determination date of three leading primary United States
government securities dealers in The City of New York (which may
include the Agents or their affiliates) (each, a "reference
dealer"), selected by the calculation agent from five reference
dealers selected by the calculation agent and eliminating the
highest quotation, or, in the event of equality, one of
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the highest and the lowest quotation or, in the event of
equality, one of the lowest, for United States Treasury
securities with an original maturity equal to the particular
index maturity, a remaining term to maturity no more than one
year shorter than that index maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at that time; or
(e) if fewer than five but more than two of the prices referred to in
clause (d) are provided as requested, the rate on the particular
interest determination date calculated by the calculation agent
based on the arithmetic mean of the bid prices obtained and
neither the highest nor the lowest of the quotations shall be
eliminated; or
(f) if fewer than three prices referred to in clause (d) are provided
as requested, the rate on the particular interest determination
date calculated by the calculation agent as a yield to maturity
based on the arithmetic mean of the secondary market bid prices
as of approximately 3:30 P.M., New York City time, on that
interest determination date of three reference dealers selected
by the calculation agent from five reference dealers selected by
the calculation agent and eliminating the highest quotation or,
in the event of equality, one of the highest and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity
greater than the particular index maturity, a remaining term to
maturity closest to that index maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at that time; or
(g) if fewer than five but more than two prices referred to in clause
(f) are provided as requested, the rate on the particular
interest determination date calculated by the calculation agent
based on the arithmetic mean of the bid prices obtained and
neither the highest nor the lowest of the quotations will be
eliminated; or
(h) if fewer than three prices referred to in clause (f) are provided
as requested, the CMT Rate in effect on the particular interest
determination date; provided that if no CMT Rate is then in
effect, the interest rate that will be effective as of the next
interest reset date will be the initial interest rate.
(2) if CMT Moneyline Telerate Page 7052 is specified in the applicable
pricing supplement:
(a) the percentage equal to the one-week or one-month, as specified
in the applicable pricing supplement, average yield for United
States Treasury securities at "constant maturity" having the
index maturity specified in the applicable pricing supplement as
published in H.15(519) opposite the caption "Treasury Constant
Maturities," as the yield is displayed on Moneyline Telerate (or
any successor service) (on page 7052 or any other page as may
replace the specified page on that service) ("Moneyline Telerate
Page 7052"), for the week or month, as applicable, ended
immediately preceding the week or month, as applicable, in which
the particular interest determination date falls; or
(b) if the rate referred to in clause (a) does not so appear on
Moneyline Telerate Page 7052, the percentage equal to the
one-week or one-month, as specified in the applicable pricing
supplement, average yield for United States Treasury securities
at "constant maturity" having the particular index maturity and
for the week or month, as applicable, preceding the particular
interest determination date as published in H.15(519) opposite
the caption "Treasury Constant Maturities;" or
(c) if the rate referred to in clause (b) does not so appear in
H.15(519), the one-week or one-month, as specified in the
applicable pricing supplement, average yield for United States
Treasury securities at "constant maturity" having the particular
index maturity as otherwise announced by the Federal Reserve Bank
of New York for the week or month, as applicable, ended
immediately preceding the week or month, as applicable, in which
the particular interest determination date falls; or
(d) if the rate referred to in clause (c) is not so published, the
rate on the particular interest determination date calculated by
the calculation agent as a yield to maturity based on the
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arithmetic mean of the secondary market bid prices at
approximately 3:30 P.M., New York City time, on that interest
determination date of three reference dealers selected by the
calculation agent from five reference dealers selected by the
calculation agent and eliminating the highest quotation, or, in
the event of equality, one of the highest and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity equal
to the particular index maturity, a remaining term to maturity no
more than one year shorter than that index maturity and in a
principal amount that is representative for a single transaction
in the securities in that market at that time; or
(e) if fewer than five but more than two of the prices referred to in
clause (d) are provided as requested, the rate on the particular
interest determination date calculated by the calculation agent
based on the arithmetic mean of the bid prices obtained and
neither the highest nor the lowest of the quotations shall be
eliminated; or
(f) if fewer than three prices referred to in clause (d) are provided
as requested, the rate on the particular interest determination
date calculated by the calculation agent as a yield to maturity
based on the arithmetic mean of the secondary market bid prices
as of approximately 3:30 P.M., New York City time, on that
interest determination date of three reference dealers selected
by the calculation agent from five reference dealers selected by
the calculation agent and eliminating the highest quotation or,
in the event of equality, one of the highest and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity
greater than the particular index maturity, a remaining term to
maturity closest to that index maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at the time; or
(g) if fewer than five but more than two prices referred to in clause
(f) are provided as requested, the rate on the particular
interest determination date calculated by the calculation agent
based on the arithmetic mean of the bid prices obtained and
neither the highest nor the lowest of the quotations will be
eliminated; or
(h) if fewer than three prices referred to in clause (f) are provided
as requested, the CMT Rate in effect on that interest
determination date; provided that if no CMT Rate is then in
effect, the interest rate that will be effective as of the next
interest reset date will be the initial interest rate.
If two United States Treasury securities with an original maturity greater
than the index maturity specified in the applicable pricing supplement have
remaining terms to maturity equally close to the particular index maturity, the
quotes for the United States Treasury security with the shorter original
remaining term to maturity will be used.
Commercial Paper Rate
"Commercial Paper Rate" means:
(1) the Money Market Yield (as defined below) on the particular interest
determination date of the rate for commercial paper having the index
maturity specified in the applicable pricing supplement as published
in H.15(519) under the caption "Commercial Paper--Nonfinancial;" or
(2) if the rate referred to in clause (1) is not so published by 3:00
P.M., New York City time, on the related calculation date, the Money
Market Yield of the rate on the particular interest determination date
for commercial paper having the particular index maturity as published
in H.15 Daily Update, or such other recognized electronic source used
for the purpose of displaying the applicable rate, under the caption
"Commercial Paper--Nonfinancial;" or
(3) if the rate referred to in clause (2) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate on
the particular interest determination date calculated by the
calculation agent as the Money Market Yield of the arithmetic mean of
the offered rates at approximately 11:00 A.M., New York City time, on
that interest determination date of three leading dealers of United
States dollar commercial paper in The City of New York (which may
include the Agents or their affiliates) selected by the calculation
agent for commercial paper having the particular index maturity placed
for industrial issuers
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whose bond rating is "Aa" by Moody's or the equivalent from another
nationally recognized statistical rating organization; or
(4) if the dealers so selected by the calculation agent are not quoting as
mentioned in clause (3), the Commercial Paper Rate in effect on the
particular interest determination date; provided that if no Commercial
Paper Rate is then in effect, the interest rate that will be effective
as of the next interest reset date will be the initial interest rate.
"Money Market Yield" means a yield (expressed as a percentage) calculated
in accordance with the following formula:
Money Market Yield = D x 360 x 100
-------------------------------------
360 - (D x M)
where "D" refers to the applicable per annum rate for commercial paper quoted on
a bank discount basis and expressed as a decimal, and "M" refers to the actual
number of days in the applicable interest reset period.
Constant Maturity Swap Rate
"Constant Maturity Swap Rate" means:
(1) the rate for U.S. Dollar swaps with the designated maturity specified
in the applicable pricing supplement, expressed as a percentage, which
appears on the Reuters Screen ISDAFIX1 Page as of 11:00 A.M., New York
City time, on the particular interest determination date; or
(2) if the rate referred to in clause (1) does not appear on the Reuters
Screen ISDAFIX1 Page by 2:00 P.M., New York City time, on such
interest determination date, a percentage determined on the basis of
the mid-market semi-annual swap rate quotations provided by the
reference banks (as defined below) as of approximately 11:00 A.M., New
York City time, on such interest determination date, and, for this
purpose, the semi-annual swap rate means the mean of the bid and
offered rates for the semi-annual fixed leg, calculated on a 30/360
day count basis, of a fixed-for-floating U.S. Dollar interest rate
swap transaction with a term equal to the designated maturity
specified in the applicable pricing supplement commencing on the
interest reset date and in a representative amount (as defined below)
with an acknowledged dealer of good credit in the swap market, where
the floating leg, calculated on an Actual/360 day count basis, is
equivalent to USD-LIBOR-BBA with a designated maturity specified in
the applicable pricing supplement. The calculation agent will request
the principal New York City office of each of the reference banks to
provide a quotation of its rate. If at least three quotations are
provided, the rate for that interest determination date will be the
arithmetic mean of the quotations, eliminating the highest quotation
(or, in the event of equality, one of the highest) and the lowest
quotation (or, in the event of equality, one of the lowest); or
(3) if such Constant Maturity Swap Rate is not determinable for a
particular interest determination date under clauses (1) and (2)
above, then such interest determination date shall be the first U.S.
Government Securities business day preceding the original interest
determination date for which the Constant Maturity Swap Rate can be
determined under clauses (1) and (2) above.
"U.S. Government Securities business day" means any day except for
Saturday, Sunday, or a day on which The Bond Market Association recommends that
the fixed income departments of its members be closed for the entire day for
purposes of trading in U.S. government securities.
"Representative amount" means an amount that is representative for a single
transaction in the relevant market at the relevant time.
"Reference banks" mean five leading swap dealers in the New York City
interbank market, selected by the calculation agent, after consultation with
Allstate Life.
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Eleventh District Cost of Funds Rate
"Eleventh District Cost of Funds Rate" means:
(1) the rate equal to the monthly weighted average cost of funds for the
calendar month immediately preceding the month in which the particular
interest determination date falls as set forth under the caption "11th
District" on the display on Moneyline Telerate (or any successor
service) on page 7058 (or any other page as may replace the specified
page on that service) ("Moneyline Telerate Page 7058") as of 11:00
A.M., San Francisco time, on that interest determination date; or
(2) if the rate referred to in clause (1) does not so appear on Moneyline
Telerate Page 7058, the monthly weighted average cost of funds paid by
member institutions of the Eleventh Federal Home Loan Bank District
that was most recently announced (the "Eleventh District Index") by
the Federal Home Loan Bank of San Francisco as the cost of funds for
the calendar month immediately preceding that interest determination
date; or
(3) if the Federal Home Loan Bank of San Francisco fails to announce the
Eleventh District Index on or prior to the particular interest
determination date for the calendar month immediately preceding that
interest determination date, the Eleventh District Cost of Funds Rate
in effect on the particular interest determination date; provided that
if no Eleventh District Cost of Funds Rate is then in effect, the
interest rate that will be effective as of the next interest reset
date will be the initial interest rate.
Federal Funds Rate
Federal Funds Open Rate
"Federal Funds Open Rate" means the rate set forth on Moneyline Telerate
Page 5 for an interest reset date underneath the caption "FEDERAL FUNDS" in the
row titled "OPEN". If the rate is not available for an interest reset date, the
rate for that interest reset date shall be the Federal Funds Rate as determined
below.
"Federal Funds Rate" means:
(1) the rate as of the particular interest determination date for United
States dollar federal funds as published in H.15(519) under the
caption "Federal Funds (Effective)" and displayed on Moneyline
Telerate (or any successor service) on page 120 (or any other page as
may replace the specified page on that service) ("Moneyline Telerate
Page 120"); or
(2) if the rate referred to in clause (1) does not so appear on Moneyline
Telerate Page 120 or is not so published by 3:00 P.M., New York City
time, on the related calculation date, the rate as of the particular
interest determination date for United States dollar federal funds as
published in H.15 Daily Update, or such other recognized electronic
source used for the purpose of displaying the applicable rate, under
the caption "Federal Funds (Effective);" or
(3) if the rate referred to in clause (2) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate as
of the particular interest determination date calculated by the
calculation agent as the arithmetic mean of the rates for the last
transaction in overnight United States dollar federal funds arranged
by three leading brokers of United States dollar federal funds
transactions in The City of New York (which may include the Agents or
their affiliates), selected by the calculation agent prior to 9:00
A.M., New York City time, on the business day following that interest
determination date; or
(4) if the brokers so selected by the calculation agent are not quoting as
mentioned in clause (3), the Federal Funds Rate in effect on the
particular interest determination date; provided that if no Federal
Funds Rate is then in effect, the interest rate that will be effective
as of the next interest reset date will be the initial interest rate.
LIBOR
"LIBOR" means:
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(1) if "LIBOR Moneyline Telerate" is specified in the applicable pricing
supplement or if neither "LIBOR Reuters" nor "LIBOR Moneyline
Telerate" is specified in the applicable pricing supplement as the
method for calculating LIBOR, the rate for deposits in the LIBOR
currency having the index maturity specified in the applicable pricing
supplement, commencing on the related interest reset date, that
appears on the LIBOR page as of 11:00 A.M., London time, on the
particular interest determination date; or
(2) if "LIBOR Reuters" is specified in the applicable pricing supplement,
the arithmetic mean of the offered rates, calculated by the
calculation agent, or the offered rate, if the LIBOR page by its terms
provides only for a single rate, for deposits in the LIBOR currency
having the particular index maturity, commencing on the related
interest reset date, that appear or appears, as the case may be, on
the LIBOR page as of 11:00 A.M., London time, on the particular
interest determination date; or
(3) if fewer than two offered rates appear, or no rate appears, as the
case may be, on the particular interest determination date on the
LIBOR page as specified in clause (1) or (2), as applicable, the rate
calculated by the calculation agent of at least two offered quotations
obtained by the calculation agent after requesting the principal
London offices of each of four major reference banks (which may
include affiliates of the Agents), in the London interbank market to
provide the calculation agent with its offered quotation for deposits
in the LIBOR currency for the period of the particular index maturity,
commencing on the related interest reset date, to prime banks in the
London interbank market at approximately 11:00 A.M., London time, on
that interest determination date and in a principal amount that is
representative for a single transaction in the LIBOR currency in that
market at that time; or
(4) if fewer than two offered quotations referred to in clause (3) are
provided as requested, the rate calculated by the calculation agent as
the arithmetic mean of the rates quoted at approximately 11:00 A.M.,
in the applicable principal financial center, on the particular
interest determination date by three major banks (which may include
affiliates of the Agents), in that principal financial center selected
by the calculation agent for loans in the LIBOR currency to leading
European banks, having the particular index maturity and in a
principal amount that is representative for a single transaction in
the LIBOR currency in that market at that time; or
(5) if the banks so selected by the calculation agent are not quoting as
mentioned in clause (4), LIBOR in effect on the particular interest
determination date; provided that if no LIBOR is then in effect, the
interest rate that will be effective as of the next interest reset
date will be the initial interest rate.
"LIBOR currency" means the currency specified in the applicable pricing
supplement as to which LIBOR shall be calculated or, if no currency is specified
in the applicable pricing supplement, United States dollars.
"LIBOR page" means either:
(1) if "LIBOR Reuters" is specified in the applicable pricing supplement,
the display on the Reuter Monitor Money Rates Service (or any
successor service) on the page specified in the applicable pricing
supplement (or any other page as may replace that page on that
service) for the purpose of displaying the London interbank rates of
major banks for the LIBOR currency; or
(2) if "LIBOR Moneyline Telerate" is specified in the applicable pricing
supplement or neither "LIBOR Reuters" nor "LIBOR Moneyline Telerate"
is specified in the applicable pricing supplement as the method for
calculating LIBOR, the display on Moneyline Telerate (or any successor
service) on the page specified in the applicable pricing supplement
(or any other page as may replace such page on such service) for the
purpose of displaying the London interbank rates of major banks for
the LIBOR currency.
"London banking day" means a day on which commercial banks are open for
business (including dealings in the LIBOR currency) in London.
EURIBOR
"EURIBOR" means, with respect to any interest determination date relating
to a series of EURIBOR notes or a series of notes that bears interest at
floating rates for which the interest rate is determined with reference to
EURIBOR (a "EURIBOR interest determination date"), the rate for deposits in
Euros as sponsored, calculated and published jointly by the
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European Banking Federation and ACI--The Financial Market Association, or any
company established by the joint sponsors for purposes of compiling and
publishing those rates, having the index maturity specified in the applicable
pricing supplement, commencing on the applicable interest reset date, as the
rate appears on Moneyline Telerate, Inc., or any successor service, on page 248
(or any other page as may replace that specified page on the service)
("Moneyline Telerate Page 248") as of 11:00 A.M., Brussels time, on the
applicable EURIBOR interest determination date. If such rate does not appear on
Moneyline Telerate Page 248, or is not so published by 11:00 A.M., Brussels
time, on the applicable EURIBOR interest determination date, such rate will be
calculated by the calculation agent and will be the arithmetic mean of at least
two quotations obtained by the calculation agent after requesting the principal
Euro-zone (as defined below) offices of four major banks in the Euro-zone
interbank market to provide the calculation agent with its offered quotation for
deposits in Euros for the period of the index maturity specified in the
applicable pricing supplement, commencing on the applicable interest reset date,
to prime banks in the Euro-zone interbank market at approximately 11:00 A.M.,
Brussels time, on the applicable EURIBOR interest determination date and in a
principal amount not less than the equivalent of $1 million in Euros that is
representative for a single transaction in Euro in the market at that time. If
fewer than two such quotations are so provided, the rate on the applicable
EURIBOR interest determination date will be calculated by the calculation agent
and will be the arithmetic mean of the rates quoted at approximately 11:00 A.M.,
Brussels time, on such EURIBOR interest determination date by four major banks
in the Euro-zone for loans in Euro to leading European banks, having the index
maturity specified in the applicable pricing supplement, commencing on the
applicable interest reset date and in a principal amount not less than the
equivalent of $1 million in Euros that is representative for a single
transaction in Euros in the market at that time. If the banks so selected by the
calculation agent are not quoting as mentioned above, EURIBOR will be EURIBOR in
effect on the applicable EURIBOR interest determination date; provided that if
no EURIBOR is then in effect, the interest rate that will be effective as of the
next interest reset date will be the initial interest rate.
"Euro-zone" means the region comprised of member states of the European
Union that have adopted the single currency in accordance with the Treaty
Establishing the European Community, as amended by the Treaty on European Union.
Prime Rate
"Prime Rate" means:
(1) the rate on the particular interest determination date as published in
H.15(519) under the caption "Bank Prime Loan;" or
(2) if the rate referred to in clause (1) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate on
the particular interest determination date as published in H.15 Daily
Update, or such other recognized electronic source used for the
purpose of displaying the applicable rate, under the caption "Bank
Prime Loan;" or
(3) if the rate referred to in clause (2) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate on
the particular interest determination date calculated by the
calculation agent as the arithmetic mean of the rates of interest
publicly announced by each bank that appears on the Reuters Screen US
PRIME 1 Page (as defined below) as the applicable bank's prime rate or
base lending rate as of 11:00 A.M., New York City time, on that
interest determination date; or
(4) if fewer than four rates referred to in clause (3) are so published by
3:00 P.M., New York City time, on the related calculation date, the
rate on the particular interest determination date calculated by the
calculation agent as the arithmetic mean of the prime rates or base
lending rates quoted on the basis of the actual number of days in the
year divided by a 360-day year as of the close of business on that
interest determination date by three major banks (which may include
affiliates of the Agents) in The City of New York selected by the
calculation agent; or
(5) if the banks so selected by the calculation agent are not quoting as
mentioned in clause (4), the Prime Rate in effect on the particular
interest determination date; provided that if no Prime Rate is then in
effect, the interest rate that will be effective as of the next
interest reset date will be the initial interest rate.
"Reuters Screen US PRIME 1 Page" means the display on the Reuter Monitor
Money Rates Service (or any successor service) on the "US PRIME 1" page (or any
other page as may replace that page on that service) for the purpose of
displaying prime rates or base lending rates of major United States banks.
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Treasury Rate
"Treasury Rate" means:
(1) the rate from the auction held on the Treasury Rate interest
determination date (the "Auction") of direct obligations of the United
States ("Treasury Bills") having the index maturity specified in the
applicable pricing supplement under the caption "INVESTMENT RATE" on
the display on Moneyline Telerate (or any successor service) on page
56 (or any other page as may replace that page on that service)
("Moneyline Telerate Page 56") or page 57 (or any other page as may
replace that page on that service) ("Moneyline Telerate Page 57"); or
(2) if the rate referred to in clause (1) is not so published by 3:00
P.M., New York City time, on the related calculation date, the Bond
Equivalent Yield (as defined below) of the rate for the applicable
Treasury Bills as published in H.15 Daily Update, or another
recognized electronic source used for the purpose of displaying the
applicable rate, under the caption "U.S. Government
Securities/Treasury Bills/Auction High;" or
(3) if the rate referred to in clause (2) is not so published by 3:00
P.M., New York City time, on the related calculation date, the Bond
Equivalent Yield of the auction rate of the applicable Treasury Bills
as announced by the United States Department of the Treasury; or
(4) if the rate referred to in clause (3) is not so announced by the
United States Department of the Treasury, or if the Auction is not
held, the Bond Equivalent Yield of the rate on the particular interest
determination date of the applicable Treasury Bills as published in
H.15(519) under the caption "U.S. Government Securities/Treasury
Bills/Secondary Market;" or
(5) if the rate referred to in clause (4) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate on
the particular interest determination date of the applicable Treasury
Bills as published in H.15 Daily Update, or another recognized
electronic source used for the purpose of displaying the applicable
rate, under the caption "U.S. Government Securities/Treasury
Bills/Secondary Market;" or
(6) if the rate referred to in clause (5) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate on
the particular interest determination date calculated by the
calculation agent as the Bond Equivalent Yield of the arithmetic mean
of the secondary market bid rates, as of approximately 3:30 P.M., New
York City time, on that interest determination date, of three primary
United States government securities dealers (which may include the
Agents or their affiliates) selected by the calculation agent, for the
issue of Treasury Bills with a remaining maturity closest to the index
maturity specified in the applicable pricing supplement; or
(7) if the dealers so selected by the calculation agent are not quoting as
mentioned in clause (6), the Treasury Rate in effect on the particular
interest determination date; provided that if no Treasury Rate is then
in effect, the interest rate that will be effective as of the next
interest reset date will be the initial interest rate.
"Bond Equivalent Yield" means a yield (expressed as a percentage)
calculated in accordance with the following formula:
Bond Equivalent Yield = D x N x 100
-------------------------------------
360 - (D x M)
where "D" refers to the applicable per annum rate for Treasury Bills quoted on a
bank discount basis and expressed as a decimal, "N" refers to 365 or 366, as the
case may be, and "M" refers to the actual number of days in the applicable
interest reset period.
Other/Additional Provisions; Addendum
Any provisions with respect to the notes of a series, including the
specification and determination of one or more interest rate bases, the
calculation of the interest rate applicable to a series of notes that bears
interest at floating rates, the
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interest payment dates, the stated maturity date, any redemption or repayment
provisions or any other term relating to the applicable series of notes, may be
modified and/or supplemented as specified under "Other/Additional Provisions" on
the face thereof or in an addendum relating thereto, if so specified on the face
thereof and, in each case, described in the applicable pricing supplement.
Discount Notes
The trusts may from time to time issue series of notes ("discount notes")
that have an issue price (as specified in the applicable pricing supplement)
that is less than 100% of the principal amount thereof (i.e. par) by more than a
percentage equal to the product of 0.25% and the number of full years to the
stated maturity date. A series of discount notes may not bear any interest
currently or may bear interest at a rate that is below market rates at the time
of issuance. The difference between the issue price of a series of discount
notes and par is referred to as the "discount." In the event of redemption,
repayment or acceleration of maturity of a series of discount notes, the amount
payable to the holders of such series of discount notes will be equal to the sum
of:
o the issue price (increased by any accruals of discount) and, in the
event of any redemption of such series of discount notes, if
applicable, multiplied by the initial redemption percentage (as
adjusted by the annual redemption percentage reduction, if
applicable); and
o any unpaid interest accrued on such series of discount notes to the
date of the redemption, repayment or acceleration of maturity, as the
case may be.
For purposes of determining the amount of discount that has accrued as of
any date on which a redemption, repayment or acceleration of maturity occurs for
a series of discount notes, a discount will be accrued using a constant yield
method. The constant yield will be calculated using a 30-day month, 360-day year
convention, a compounding period that, except for the initial period (as defined
below), corresponds to the shortest period between interest payment dates for
the applicable series of discount notes (with ratable accruals within a
compounding period), a coupon rate equal to the initial coupon rate applicable
to the applicable series of discount notes and an assumption that the maturity
of such series of discount notes will not be accelerated. If the period from the
date of issue to the first interest payment date for a series of discount notes
(the "initial period") is shorter than the compounding period for such series of
discount notes, a proportionate amount of the yield for an entire compounding
period will be accrued. If the initial period is longer than the compounding
period, then the period will be divided into a regular compounding period and a
short period with the short period being treated as provided in the preceding
sentence. The accrual of the applicable discount may differ from the accrual of
original issue discount for purposes of the Code, certain series of discount
notes may not be treated as having original issue discount within the meaning of
the Code, and certain series of notes other than discount notes may be treated
as issued with original issue discount for federal income tax purposes. See
"United States Federal Income Tax Considerations."
Amortizing Notes
The trusts may from time to time issue series of notes ("amortizing notes")
with the amount of principal thereof and interest thereon payable in
installments over their terms. Unless otherwise specified in the applicable
pricing supplement, interest on each series of amortizing notes will be computed
on the basis of a 360-day year of twelve 30-day months. Payments with respect to
a series of amortizing notes will be applied first to interest due and payable
thereon and then to the reduction of the unpaid principal amount thereof.
Further information concerning additional terms and provisions of a particular
series of amortizing notes will be specified in the applicable pricing
supplement, including a table setting forth repayment information for such
series of amortizing notes.
Form of Notes
Book-entry notes
When a trust issues notes in book-entry form, it will issue one or more
global securities representing the entire issue of notes. Unless otherwise
specified in the applicable pricing supplement, these certificates will name a
nominee of The Depository Trust Company, New York, New York ("DTC") as the owner
of the notes. DTC maintains a computerized system that will reflect your
ownership of the applicable notes through an account you will maintain with your
broker/dealer, bank, trust company or other representative. If specified in the
applicable pricing supplement, notes of a series may also be issued in
book-entry form and registered in the name of a nominee for Euroclear and
Clearstream Luxembourg. For
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additional information regarding such notes, you should review "Special
Provisions Relating to Foreign Currency Notes" below.
Unless otherwise specified in the applicable pricing supplement, DTC's
nominee will be considered the owner of your notes in the records of the issuing
trust and will be the entity entitled to cast a vote regarding your notes.
However, DTC and the broker/dealers, banks, trust companies and other
representatives that are part of DTC's computerized system are required to
contact you for voting instructions.
Definitive Notes
When a trust issues notes in definitive form, you will receive a note
certificate evidencing your notes. The certificate will name you as the owner of
such notes, unless you choose to have your broker/dealer, bank, trust company or
other representative hold these certificates for you. If your name appears on
the note certificate evidencing your notes, then you will be considered the
owner of your notes for all purposes under the relevant indenture. For example,
if the issuing trust needs to ask the holders of the applicable series of notes
to vote on a proposed amendment to such series of notes, you will be asked to
cast the vote regarding your notes. If you have chosen to have some other entity
hold the note certificates for you, that entity will be considered the owner of
your notes in the records of the issuing trust and will be entitled to cast the
vote regarding your notes. However, this entity is required to contact you for
voting instructions.
Exchanges
Definitive notes cannot be exchanged for book-entry notes. Book-entry notes
can be exchanged for definitive notes only if;
o the depositary notifies the issuing trust that it is unwilling or
unable to continue as depositary for the global securities or the
issuing trust becomes aware that the depositary has ceased to be a
clearing agency registered under the Exchange Act and, in any such
case, such trust fails to appoint a successor to the depositary within
60 calendar days;
o subject to the procedures of DTC, the issuing trust, in its sole
discretion, determines that the notes of the relevant series should no
longer be represented solely by one or more global securities; or
o an event of default has occurred and is continuing with respect to the
relevant series of notes under the applicable indenture and the
maturity of the notes of such series is accelerated in accordance with
the terms of the applicable indenture and the notes of such series.
In these limited circumstances, the issuing trust will issue to you
definitive notes in exchange for the book-entry notes. There will be no service
charge for this exchange, but if a tax or other governmental charge is imposed,
the issuing trust may require you to pay it.
Clearing Systems
Unless otherwise specified in the applicable pricing supplement, each note
will be deposited with, or on behalf of, DTC, as depositary, and registered in
the name of Cede & Co. (DTC's partnership nominee). Investors may elect to hold
interests in the notes through DTC (in the United States) or, if the notes are
eligible, through Clearstream Luxembourg or Euroclear, as operator (the
"Euroclear Operator") of the Euroclear System, if they are participants in such
systems or indirectly through organizations which are participants in such
systems. Clearstream Luxembourg and the Euroclear Operator will hold interests
on behalf of their participants through customers' securities accounts in
Clearstream Luxembourg's and the Euroclear Operator's names, respectively, on
the books of their respective depositaries, which in turn will hold such
interests in customers' securities accounts in the depositaries' names on the
books of the DTC. It is anticipated that Citibank, N.A. will act as depositary
for Clearstream Luxembourg and that The Chase Manhattan Bank will act as
depositary for the Euroclear Operator (in such capacities, the "U.S.
Depositaries").
If so specified in the applicable pricing supplement, notes of a series may
be registered in the name of a nominee for, and deposited with, a common
depositary for Euroclear and Clearstream Luxembourg.
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Clearstream Luxembourg advises that it is incorporated under the laws of
Luxembourg as a professional depositary. Clearstream Luxembourg holds securities
for its participating organizations ("Clearstream Participants") and facilitates
the clearance and settlement of securities transactions between Clearstream
Participants through electronic book-entry changes in accounts of Clearstream
Participants, thereby eliminating the need for physical movement of
certificates. Clearstream Luxembourg provides to Clearstream Participants, among
other things, services for safekeeping, administration, clearance and settlement
of internationally traded securities and securities lending and borrowing.
Clearstream Luxembourg interfaces with domestic markets in several countries. As
a professional depositary, Clearstream Luxembourg is subject to regulation by
the Luxembourg Monetary Institute. Clearstream Participants are recognized
financial institutions around the world, including underwriters, securities
brokers and dealers, banks, trust companies, clearing corporations and certain
other organizations and may include the Agents named in this prospectus
supplement or any applicable pricing supplement. Indirect access to Clearstream
Luxembourg is also available to others, such as banks, brokers, dealers and
trust companies that clear through or maintain a custodial relationship with a
Clearstream Participant either directly or indirectly.
Distributions with respect to the notes held beneficially through
Clearstream Luxembourg will be credited to cash accounts of Clearstream
Participants in accordance with its rules and procedures, to the extent received
by the U.S. Depositary for Clearstream Luxembourg.
The Euroclear Operator advises that Euroclear was created in 1968 to hold
securities for participants of Euroclear ("Euroclear Participants") and to clear
and settle transactions between Euroclear Participants through simultaneous
electronic book-entry delivery against payment, thereby eliminating the need for
physical movement of certificates and any risk from lack of simultaneous
transfers of securities and cash. Euroclear includes various other services,
including securities lending and borrowing and interfaces with domestic markets
in several countries. Euroclear is operated by the Euroclear Operator under
contract with Euroclear Clearance Systems S.C., a Belgian cooperative
corporation (the "Cooperative"). All operations are conducted by the Euroclear
Operator, and all Euroclear securities clearance accounts and Euroclear cash
accounts are accounts with the Euroclear Operator, not the Cooperative. The
Cooperative establishes policy for Euroclear on behalf of Euroclear
Participants. Euroclear Participants include banks (including central banks),
securities brokers and dealers and other professional financial intermediaries
and may include the Agents named in this prospectus supplement or any applicable
pricing supplement. Indirect access to Euroclear is also available to other
firms that clear through or maintain a custodial relationship with a Euroclear
Participant, either directly or indirectly.
The Euroclear Operator was granted a banking license by the Belgian Banking
and Finance Commission in 2000, authorizing it to carry out banking activities
on a global basis. It took over operation of Euroclear from the Brussels,
Belgium office of Morgan Guaranty Trust Company of New York on December 31,
2000. Securities clearance accounts and cash accounts with the Euroclear
Operator are governed by the Terms and Conditions Governing Use of Euroclear and
the related Operating Procedures of the Euroclear System, and applicable Belgian
law (collectively, the "Terms and Conditions"). The Terms and Conditions govern
transfers of securities and cash within Euroclear, withdrawals of securities and
cash from Euroclear, and receipts of payments with respect to securities in
Euroclear. All securities in Euroclear are held on a fungible basis without
attribution of specific certificates to specific securities clearance accounts.
The Euroclear Operator acts under the Terms and Conditions only on behalf of
Euroclear Participants, and has no record of or relationship with persons
holding through Euroclear Participants.
Distributions with respect to notes held beneficially through Euroclear
will be credited to the cash accounts of Euroclear Participants in accordance
with the Terms and Conditions, to the extent received by the U.S. Depositary for
Euroclear.
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GLOBAL CLEARANCE AND SETTLEMENT PROCEDURES
General
Initial settlement for the notes of a series will be made in immediately
available funds. Secondary market trading between DTC Participants will occur in
the ordinary way in accordance with DTC's rules and will be settled in
immediately available funds using DTC's Same-Day Funds Settlement System.
Secondary market trading between Clearstream Participants and/or Euroclear
Participants will occur in the ordinary way in accordance with the applicable
rules and operating procedures of Clearstream Luxembourg and Euroclear and will
be settled using the procedures applicable to conventional eurobonds in
immediately available funds. Cross-market transfers between persons holding
directly or indirectly through DTC on the one hand, and directly or indirectly
through Clearstream Participants or Euroclear Participants, on the other, will
be effected in DTC in accordance with DTC's rules on behalf of the relevant
European international clearing system by its U.S. Depositary. However, such
cross-market transactions will require delivery of instructions to the relevant
European international clearing system by the counterparty in such system in
accordance with its rules and procedures and within its established deadlines
(European time). The relevant European international clearing system will, if
the transaction meets its settlement requirements, deliver instructions to its
U.S. Depositary to take action to effect final settlement on its behalf by
delivering or receiving notes in DTC, and making or receiving payment in
accordance with normal procedures for same-day funds settlement applicable to
DTC. Clearstream Participants and Euroclear Participants may not deliver
instructions directly to DTC. Because of time-zone differences, credits of notes
received in Clearstream Luxembourg or Euroclear as a result of a transaction
with a DTC Participant will be made during subsequent securities settlement
processing and will be credited the business day following the DTC settlement
date. Such credits or any transactions in such notes settled during such
processing will be reported to the relevant Euroclear Participants or
Clearstream Participants on such business day. Cash received in Clearstream
Luxembourg or Euroclear as a result of sales of notes by or through a
Clearstream Participant or a Euroclear Participant to a DTC Participant will be
received with value on the DTC settlement date but will be available in the
relevant Clearstream Luxembourg or Euroclear cash account only as of the
business day following settlement in the DTC.
Although the DTC, Clearstream Luxembourg and the Euroclear Operator have
agreed to the foregoing procedures in order to facilitate transfers of notes
among participants in DTC, Clearstream Luxembourg and Euroclear, they are under
no obligation to perform or continue to perform such procedures and such
procedures may be discontinued at any time.
Certain alternative clearance and settlement procedures will apply if the
applicable pricing supplement specifies that notes of a series are denominated
in non-U.S. dollar currencies. Such alternative procedures are described below
under "Special Provisions Relating to Foreign Currency Notes."
Secondary Market Trading
Because the purchaser determines the place of delivery, it is important to
establish at the time of trading of any notes where both the purchaser's and
seller's accounts are located to ensure that settlement can be made on the
desired value date.
Trading between DTC Participants
Secondary market sales of notes held in DTC between DTC participants will
occur in the ordinary way in accordance with DTC rules and will be settled using
the procedures applicable to United States corporate debt obligations.
Trading between Euroclear and/or Clearstream Participants
Secondary market sales of beneficial interests in the notes held through
Euroclear or Clearstream Luxembourg to purchasers that will hold beneficial
interests through Euroclear or Clearstream Luxembourg will be conducted in
accordance with the normal rules and operating procedures of Euroclear and
Clearstream Luxembourg and will be settled using the procedures applicable to
conventional eurobonds.
Trading between DTC Seller and Euroclear/Clearstream Luxembourg Purchaser
When book-entry interests in notes are to be transferred from the account
of a DTC participant to the account of a Euroclear or Clearstream Luxembourg
accountholder, the purchaser must first send instructions to Euroclear or
Clearstream Luxembourg through a participant at least one business day prior to
the settlement date. Euroclear or Clearstream Luxembourg will then instruct its
depositary to receive the notes and make payment for them. On the settlement
date, the
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depositary will make payment to the DTC participant's account and the notes will
be credited to the depositary's account. After settlement has been completed,
DTC will credit the notes to the U.S. Depositary for Euroclear or Clearstream
Luxembourg, as the case may be. Euroclear or Clearstream Luxembourg will credit
the notes, in accordance with its usual procedures, to the participant's
account, and the participant will then credit the purchaser's account. These
securities credits will appear the next day (European time) after the settlement
date. The cash debit from the account of Euroclear or Clearstream Luxembourg
will be back-valued to the value date (which will be the preceding day if
settlement occurs in New York). If settlement is not completed on the intended
value date (i.e., the trade fails), the cash debit will instead be valued at the
actual settlement date. Since the settlement will occur during New York business
hours, a DTC participant selling an interest in the notes can use its usual
procedures for transferring notes to the U.S. Depositary for Euroclear or
Clearstream Luxembourg, as the case may be, for the benefit of Euroclear
Participants or Clearstream Participants. The DTC seller will receive the sale
proceeds on the settlement date. Thus, to the DTC seller, a cross-market sale
will settle no differently than a trade between two DTC Participants.
Trading between a Euroclear or Clearstream Luxembourg Seller and a DTC
Purchaser
Due to time zone differences in their favor, Euroclear participants and
Clearstream Luxembourg participants can use their usual procedures to transfer
notes through the applicable U.S. Depositary to a DTC participant. The seller
must first send instructions to Euroclear or Clearstream Luxembourg through a
participant at least one business day prior to the settlement date. Euroclear or
Clearstream Luxembourg will then instruct its U.S. Depositary to credit the
notes to the DTC participant's account and receive payment. The payment will be
credited in the account of the Euroclear or Clearstream Luxembourg participant
on the following day, but the receipt of the cash proceeds will be back-valued
to the value date (which will be the preceding day if settlement occurs in New
York). If settlement is not completed on the intended value date (i.e., the
trade fails), the receipt of the cash proceeds will instead be valued at the
actual settlement date.
Although the foregoing sets out the procedures of Euroclear, Clearstream
Luxembourg and DTC in order to facilitate the transfers of interests in the
notes among participants of DTC, Clearstream Luxembourg and Euroclear, none of
Euroclear, Clearstream Luxembourg or DTC is under any obligation to perform or
continue to perform such procedures, and such procedures may be discontinued at
any time. Neither the registrants and the trusts nor any Agent or any paying
agent or any affiliate of any of the above, or any person by whom any of the
above is controlled for the purposes of the Securities Act, will have any
responsibility for the performance by DTC, Euroclear and Clearstream Luxembourg
or their respective direct or indirect participants or accountholders of their
respective obligations under the rules and procedures governing their operations
or for the sufficiency for any purpose of the arrangements described above.
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SPECIAL PROVISIONS RELATING TO FOREIGN CURRENCY NOTES
General
Unless otherwise specified in the applicable pricing supplement, foreign
currency notes will not be sold in, or to residents of, the country issuing the
specified currency. The information set forth in this prospectus supplement is
directed to prospective purchasers who are United States residents. The trusts
and the Agents disclaim any responsibility to advise prospective purchasers who
are residents of countries other than the United States with respect to any
matters that may affect the purchase, holding or receipt of payments of
principal of, and premium, if any, and interest, if any, on, their foreign
currency notes. These purchasers should consult their own financial and legal
advisors with regard to these risks. See "Risk Factors--Risk Factors Relating to
the Notes--Foreign currency notes are subject to exchange rate and exchange
control risks."
Payment of Principal and/or any Premium, if any, Interest and Additional Amounts
Unless otherwise specified in the applicable pricing supplement, each trust
is obligated to make, or cause to be made, payments of principal of, any premium
and interest on, and any additional amounts with respect to a foreign currency
note issued by it in the specified currency. Any amounts so payable by such
trust in the specified currency will be converted by the indenture trustee, or
another entity specified in the applicable indenture, as exchange rate agent
(including, in each case, any successors, the "exchange rate agent") into United
States dollars for payment to the registered holder or holders thereof unless
otherwise specified in the applicable pricing supplement or a registered holder
elects to receive these amounts in the specified currency as provided below.
Unless otherwise specified in the applicable pricing supplement, any United
States dollar amount to be received by the registered holder or holders of a
series of foreign currency notes will be based on the highest bid quotation in
The City of New York received by the exchange rate agent at approximately 11:00
A.M., New York City time, on the second business day preceding the applicable
payment date from three recognized foreign exchange dealers (one of whom may be
the exchange rate agent) selected by the exchange rate agent and approved by the
issuing trust for the purchase by the quoting dealer of the specified currency
for United States dollars for settlement on that payment date in the aggregate
amount of the specified currency payable to the registered holder or holders of
such series of foreign currency notes scheduled to receive United States dollar
payments and at which the applicable dealer commits to execute a contract. All
currency exchange costs will be borne by the relevant registered holder or
holders of such series of foreign currency notes by deductions from any
payments. If three bid quotations are not available, payments will be made in
the specified currency.
Registered holders of foreign currency notes may elect to receive all or a
specified portion of any payment of principal, and/or any interest, premium and
additional amounts in the specified currency by submitting a written request to
the indenture trustee at its corporate trust office in The City of New York on
or prior to the applicable regular interest record date or special interest
record date or at least fifteen calendar days prior to the maturity date, as the
case may be. Such written request may be mailed or hand delivered or sent by
cable, telex or other form of facsimile transmission. Such election will remain
in effect until revoked by written notice delivered to the indenture trustee on
or prior to a regular interest record date or special interest record date or at
least fifteen calendar days prior to the maturity date, as the case may be.
Registered holders of foreign currency notes to be held in the name of a broker
or nominee should contact their broker or nominee to determine whether and how
an election to receive payments in the specified currency may be made.
Unless otherwise specified in the applicable pricing supplement, if the
specified currency is other than United States dollars, an entitlement holder
with respect to a note represented by a global security which elects to receive
payments of principal, and/or any interest, premium and additional amounts in
the specified currency must notify the participant through which it owns its
interest on or prior to the applicable regular interest record date or special
interest record date or at least fifteen calendar days prior to the maturity
date, as the case may be, of its election. The applicable participant must
notify the depositary of such election on or prior to the third business day
after the applicable regular interest record date or at least twelve calendar
days prior to the maturity date, as the case may be, and the depositary will
notify the indenture trustee of that election on or prior to the fifth business
day after the applicable regular interest record date or at least ten calendar
days prior to the maturity date, as the case may be. If complete instructions
are received by the participant from the applicable entitlement holder and
forwarded by the participant to the depositary, and by the depositary to the
indenture trustee, on or prior to such dates, then the applicable entitlement
holder will receive payments in the specified currency.
Notwithstanding anything herein to the contrary, if the specified currency
for a series of foreign currency notes is not available for any required payment
of principal and/or any interest, premium and additional amounts due to the
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imposition of exchange controls or other circumstances beyond the issuing
trust's control, the issuing trust will be entitled to satisfy its obligations
with respect to such series of foreign currency notes by making, or causing to
be made, payments in United States dollars based on the market exchange rate
computed by the exchange rate agent on the second business day prior to the
particular payment date or, if the market exchange rate is not then available,
on the basis of the most recently available market exchange rate.
The "market exchange rate" for a specified currency other than United
States dollars means the noon dollar buying rate in The City of New York for
cable transfers for the specified currency as certified for customs purposes
(or, if not so certified, as otherwise determined) by the Federal Reserve Bank
of New York.
All determinations made by the exchange rate agent shall be at its sole
discretion and shall, in the absence of manifest error, be conclusive for all
purposes and binding on the registered holder or holders of the foreign currency
notes and any applicable entitlement holders.
Judgment Currency
Each trust will indemnify the registered holder of any note issued by it
against any loss incurred as a result of any judgment or order being given or
made for any amount due under the particular note and that judgment or order
requiring payment in a currency (the "judgment currency") other than the
specified currency, and as a result of any variation between:
o the rate of exchange at which the specified currency amount is
converted into the judgment currency for the purpose of that judgment
or order; and
o the rate of exchange at which the registered holder, on the date of
payment of that judgment or order, is able to purchase the specified
currency with the amount of the judgment currency actually received.
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DESCRIPTION OF THE FUNDING AGREEMENTS
Each trust will use the net proceeds from the issuance of its series of
notes to the public to purchase from Global Funding one or more funding
agreements issued by Allstate Life. The funding agreement(s) will have a
principal amount equal to the principal amount of the related series of notes.
The funding agreement(s) will otherwise have payment and other terms
substantially similar to the related series of notes.
The funding agreement(s) may be interest bearing or non-interest bearing
and, if interest bearing, may bear interest at fixed or floating rates. The
calculation of the interest rate, the due dates for payments and other payment
terms of each funding agreement will be determined in the manner substantially
similar to that described above under "Description of the Notes." An amount
equal to the principal amount of the funding agreement plus accrued but unpaid
interest, if any, and accrued discount, if any (in the case of a discount
funding agreement) (other than an amortizing funding agreement) will be payable
on its maturity date. Allstate Life may issue an amortizing funding agreement
that pays an amount in respect of both interest and deposit amount over the life
of the funding agreement. For a more detailed discussion of the funding
agreements, see "Description of the Funding Agreement" in the accompanying
prospectus.
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UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
General
This section provides a discussion of the material United States Federal
income tax consequences of the purchase, ownership and disposition of the notes.
This summary is based upon laws, regulations, rulings and decisions now in
effect, all of which are subject to change (including changes in effective
dates) or possible differing interpretations. This summary deals only with notes
held as capital assets and does not purport to deal with persons in special tax
situations, such as financial institutions, partnerships, insurance companies,
regulated investment companies, dealers in securities or currencies, persons
holding notes as a hedge against currency risks or as a position in a "straddle"
for tax purposes, or persons whose functional currency is not the United States
dollar. It also does not deal with holders other than initial purchasers of
notes (except where otherwise specifically noted). Persons considering the
purchase of the notes should consult their own tax advisors concerning the
application of United States Federal income tax laws to their particular
situations as well as any consequences of the purchase, ownership and
disposition of the notes arising under the laws of any other taxing
jurisdiction. This summary does not consider the United States Federal income
tax consequences of the purchase, ownership or disposition of a note by a
partnership. If a partnership holds a note, the tax treatment of a partner will
generally depend upon the status of the partner and the activities of the
partnership. Partnerships holding a note, and partners in a partnership holding
a note, should consult their tax advisors.
As used herein, the term "U.S. Holder" means a beneficial owner of a note
that is for United States Federal income tax purposes:
o a citizen or resident of the United States;
o a corporation (including an entity treated as a corporation for United
States Federal income tax purposes) created or organized in or under
the laws of the United States, any state thereof or the District of
Columbia;
o an estate whose income is subject to United States Federal income tax
regardless of its source; or
o subject to applicable transition rules, a trust if a court within the
United States is able to exercise primary supervision over the
administration of the trust and one or more United States persons have
the authority to control all substantial decisions of the trust.
As used in this section, the term "non-U.S. Holder" means a beneficial
owner of a note that is an individual, a corporation, an estate or trust that is
not a U.S. Holder.
Classification of the Issuer and Notes
In the opinion of LeBoeuf, Lamb, Greene & MacRae LLP, special tax counsel
to Global Funding, under current law and based on certain facts and assumptions
contained in such opinion:
o Global Funding and each trust will be ignored for United States
Federal income tax purposes and will not be treated as an association
or a publicly traded partnership taxable as a corporation; and
o the notes will be classified as indebtedness of Allstate Life for
United States Federal income tax purposes.
Allstate Life, Global Funding and each trust agree, and each holder and
beneficial owner of notes by purchasing the notes agrees, for all United States
Federal, state and local income and franchise tax purposes (i) to treat the
notes as indebtedness of Allstate Life, (ii) Global Funding and each trust will
be ignored and will not be treated as an association or a publicly traded
partnership taxable as a corporation and (iii) to not take any action
inconsistent with the treatment described in (i) and (ii) unless otherwise
required by law. The remainder of this discussion assumes the notes are properly
treated as indebtedness of Allstate Life for all United States Federal income
tax purposes.
An opinion of tax counsel is not binding on the Internal Revenue Service
(the "IRS") or the courts, and no ruling on any of the consequences or issues
discussed below will be sought from the IRS. The IRS might assert that each
trust should be treated as a separate grantor trust for United States Federal
income tax purposes, in which case the holders of beneficial interests in the
notes related to such trust would be treated as owning a pro rata undivided
interest in the assets of such trust.
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In such a case, the tax consequences to beneficial owners of the notes would not
be materially different than those described herein. Persons considering the
purchase of notes should consult their own tax advisors about the United States
Federal income tax consequences of an investment in the notes and the
application of United States Federal income tax laws, as well as the laws of any
state, local or foreign taxing jurisdictions, to their particular situations.
U.S. Holders
Payments of Interest
Except as described below, payments of interest on a note generally
will be taxable to a U.S. Holder as ordinary interest income at the time such
payments are accrued or are received (in accordance with the U.S. Holder's
regular method of tax accounting).
Discount Notes
The following summary is a general discussion of the United States Federal
income tax consequences to U.S. Holders of the purchase, ownership and
disposition of notes issued with original issue discount ("discount notes").
For United States Federal income tax purposes, original issue discount
("OID") is the excess of the stated redemption price at maturity of a note over
its issue price, if such excess equals or exceeds a de minimis amount (generally
1/4 of 1% of the note's stated redemption price at maturity multiplied by the
number of complete years to its maturity from its issue date or, in the case of
a note providing for the payment of any amount other than qualified stated
interest (as defined below) prior to maturity, multiplied by the weighted
average maturity of such note). The issue price of each note in an issue of
notes equals the first price at which a substantial amount of such notes has
been sold (ignoring sales to bond houses, brokers, or similar persons or
organizations acting in the capacity of underwriters, placement agents, or
wholesalers). The stated redemption price at maturity of a note is the sum of
all payments provided by the note other than "qualified stated interest"
payments. The term "qualified stated interest" generally means stated interest
that is unconditionally payable in cash or property (other than debt instruments
of the issuer) at least annually at a single fixed rate. In addition, if a note
bears interest for one or more accrual periods at a rate below the rate
applicable for the remaining term of such note (e.g., notes with teaser rates or
interest holidays), and if the greater of either the resulting foregone interest
on such note or any "true" discount on such note (i.e., the excess of the note's
stated principal amount over its issue price) equals or exceeds a specified de
minimis amount, then some or all of the stated interest on the note would be
treated as OID rather than qualified stated interest.
Payments of qualified stated interest on a note are taxable to a U.S.
Holder as ordinary interest income at the time such payments are accrued or are
received (in accordance with the U.S. Holder's regular method of tax
accounting). A U.S. Holder of a discount note must include OID in income as
ordinary interest for United States Federal income tax purposes as it accrues
under a constant yield method in advance of receipt of the cash payments
attributable to such income, regardless of such U.S. Holder's regular method of
tax accounting. In general, the amount of OID included in income by the initial
U.S. Holder of a discount note is the sum of the daily portions of OID with
respect to such discount note for each day during the taxable year (or portion
of the taxable year) on which such U.S. Holder held such discount note. The
"daily portion" of OID on any discount note is determined by allocating to each
day in any accrual period a ratable portion of the OID allocable to that accrual
period. An "accrual period" may be of any length and the accrual periods may
vary in length over the term of the discount note, provided that each accrual
period is no longer than one year and each scheduled payment of principal or
interest occurs either on the final day of an accrual period or on the first day
of an accrual period. The amount of OID allocable to each accrual period is
generally equal to the difference between:
o the product of the discount note's adjusted issue price at the
beginning of such accrual period and its yield to maturity (determined
on the basis of compounding at the close of each accrual period and
appropriately adjusted to take into account the length of the
particular accrual period); and
o the amount of any qualified stated interest payments allocable to such
accrual period. The "adjusted issue price" of a discount note at the
beginning of any accrual period is the sum of the issue price of the
discount note plus the amount of OID allocable to all prior accrual
periods minus the amount of any prior payments on the discount note
that were not qualified stated interest payments. Under these rules,
U.S. Holders generally will have to include in income increasingly
greater amounts of OID in successive accrual periods.
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A U.S. Holder who purchases a discount note for an amount that is greater
than its adjusted issue price as of the purchase date and less than or equal to
the sum of all amounts payable on the discount note after the purchase date
other than payments of qualified stated interest, will be considered to have
purchased the discount note at an "acquisition premium." Under the acquisition
premium rules, the amount of OID which such U.S. Holder must include in its
gross income with respect to such discount note for any taxable year (or portion
thereof in which the U.S. Holder holds the discount note) will be reduced (but
not below zero) by the portion of the acquisition premium properly allocable to
the period.
Floating Rate Notes
Notes that bear interest at floating rates ("variable notes") are subject
to special rules whereby a variable note will qualify as a "variable rate debt
instrument" if:
o its issue price does not exceed the total noncontingent principal
payments due under the variable note by more than a specified de
minimis amount;
o it provides for stated interest, paid or compounded at least annually,
at current values of, one or more qualified floating rates, a single
fixed rate and one or more qualified floating rates, a single
objective rate, or a single fixed rate and a single objective rate
that is a qualified inverse floating rate; and
o it does not provide for any principal payments which are contingent.
A "qualified floating rate" is any variable rate where variations in the
value of such rate can reasonably be expected to measure contemporaneous
variations in the cost of newly borrowed funds in the currency in which the
variable note is denominated. Although a multiple of a qualified floating rate
will generally not itself constitute a qualified floating rate, a variable rate
equal to the product of a qualified floating rate and a fixed multiple that is
greater than .65 but not more than 1.35 will constitute a qualified floating
rate. A variable rate equal to the product of a qualified floating rate and a
fixed multiple that is greater than .65 but not more than 1.35, increased or
decreased by a fixed rate, will also constitute a qualified floating rate. In
addition, two or more qualified floating rates that can reasonably be expected
to have approximately the same values throughout the term of the variable note
(e.g., two or more qualified floating rates with values within 25 basis points
of each other as determined on the variable note's issue date) will be treated
as a single qualified floating rate. Notwithstanding the foregoing, a variable
rate that would otherwise constitute a qualified floating rate but which is
subject to one or more restrictions such as a maximum numerical limitation
(i.e., a cap) or a minimum numerical limitation (i.e., a floor) may, under
certain circumstances, fail to be treated as a qualified floating rate unless
such cap or floor is fixed throughout the term of the note. An "objective rate"
is a rate that is not itself a qualified floating rate but which is determined
using a single fixed formula and that is based on objective financial or
economic information. A rate will not qualify as an objective rate if it is
based on information that is within the control of Allstate Life (or a related
party) or that is unique to the circumstances of Allstate Life (or a related
party), such as dividends, profits, or the value of Allstate Life's stock
(although a rate does not fail to be an objective rate merely because it is
based on the credit quality of Allstate Life). A "qualified inverse floating
rate" is any objective rate where such rate is equal to a fixed rate minus a
qualified floating rate, as long as variations in the rate can reasonably be
expected to inversely reflect contemporaneous variations in the qualified
floating rate. In addition, if a variable note provides for stated interest at a
fixed rate for an initial period of one year or less followed by a variable rate
that is either a qualified floating rate or an objective rate and if the
variable rate on the variable note's issue date is intended to approximate the
fixed rate (e.g., the value of the variable rate on the issue date does not
differ from the value of the fixed rate by more than 25 basis points), then the
fixed rate and the variable rate together will constitute either a single
qualified floating rate or objective rate, as the case may be.
If a variable note that provides for stated interest at either a single
qualified floating rate or a single objective rate throughout the term thereof
qualifies as a "variable rate debt instrument" and if the interest on such note
is unconditionally payable in cash or property (other than debt instruments of
the issuer) at least annually, then all stated interest on the note will
constitute qualified stated interest and will be taxed accordingly. Thus, a
variable note that provides for stated interest at either a single qualified
floating rate or a single objective rate throughout the term thereof and that
qualifies as a "variable rate debt instrument" will generally not be treated as
having been issued with OID unless the variable note is issued at a "true"
discount (i.e., at a price below the note's stated principal amount) in excess
of a specified de minimis amount. The amount of qualified stated interest and
the amount of OID, if any, that accrues during an accrual period on such a
variable note is determined under the rules applicable to fixed rate debt
instruments by assuming that the variable rate is a fixed rate equal to:
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o in the case of a qualified floating rate or qualified inverse floating
rate, the value, as of the issue date, of the qualified floating rate
or qualified inverse floating rate; or
o in the case of an objective rate (other than a qualified inverse
floating rate), a fixed rate that reflects the yield that is
reasonably expected for the variable note. The qualified stated
interest allocable to an accrual period is the amount of interest
actually paid during such accrual period.
In general, any other variable note that qualifies as a "variable rate debt
instrument" will be converted into an "equivalent" fixed rate debt instrument
for purposes of determining the amount and accrual of OID and qualified stated
interest on the variable note. A variable note is converted into an "equivalent"
fixed rate debt instrument by substituting any qualified floating rate or
qualified inverse floating rate provided for under the terms of the variable
note with a fixed rate equal to the value of the qualified floating rate or
qualified inverse floating rate, as the case may be, as of the variable note's
issue date. Any objective rate (other than a qualified inverse floating rate)
provided for under the terms of the variable note is converted into a fixed rate
that reflects the yield that is reasonably expected for the variable note. In
the case of a variable note that qualifies as a "variable rate debt instrument"
and provides for stated interest at a single fixed rate in addition to either
one or more qualified floating rates or a qualified inverse floating rate, the
fixed rate is initially converted into a qualified floating rate (or a qualified
inverse floating rate, if the variable note provides for a qualified inverse
floating rate). Under such circumstances, the qualified floating rate or
qualified inverse floating rate that replaces the fixed rate must be such that
the fair market value of the variable note as of the variable note's issue date
is approximately the same as the fair market value of an otherwise identical
debt instrument that provides for either the qualified floating rate or
qualified inverse floating rate rather than the fixed rate. Subsequent to
converting the fixed rate into either a qualified floating rate or a qualified
inverse floating rate, the variable note is then converted into an "equivalent"
fixed rate debt instrument in the manner described above.
Once the variable note is converted into an "equivalent" fixed rate debt
instrument pursuant to the foregoing rules, the amount of OID and qualified
stated interest, if any, are determined for the "equivalent" fixed rate debt
instrument by applying the general OID rules to the "equivalent" fixed rate debt
instrument. A U.S. Holder of the variable note will account for such OID and
qualified stated interest as if the U.S. Holder held the "equivalent" fixed rate
debt instrument. Each accrual period appropriate adjustments will be made to the
amount of qualified stated interest or OID assumed to have been accrued or paid
with respect to the "equivalent" fixed rate debt instrument in the event that
such amounts differ from the actual amount of interest accrued or paid on the
variable note during the accrual period.
If the variable note does not qualify as a "variable rate debt instrument"
then the variable note would be treated as a contingent payment debt instrument.
A U.S. Holder of a contingent payment debt instrument is generally required to
include future contingent and noncontingent interest payments in income under
the constant yield method as such interest accrues based on Allstate Life's
determination of the "comparable yield" and the establishment of a "projected
payment schedule" that must produce the comparable yield. The comparable yield
is the yield at which Allstate Life would issue a fixed rated debt instrument
with similar terms and conditions. The projected payment schedule consists of
all stated principal payments and a projected amount and time for each
contingent interest payment. If the actual amount of any contingent payment,
once determined, differs from the projected amounts, appropriate adjustments are
to be made to the amounts required to be included in gross income by the U.S.
Holder. The yield, timing and amounts set forth in the projected payment
schedule are for purposes of computing the OID only and are not assurances by
the trusts with respect to any aspect of the notes. Because U.S. Holders will
generally be bound by Allstate Life's determination of the comparable yield and
by the projected payment schedule for United States Federal income tax purposes,
a U.S. Holder's income inclusions may be accelerated relative to the time
payments under the notes are in fact made. The IRS has authority to disregard a
projected payment schedule it determines to be unreasonable. Any gain recognized
by a U.S. Holder on the sale, exchange, or retirement of a contingent payment
debt instrument will be treated as interest income and all or a portion of any
loss realized could be treated as ordinary loss as opposed to capital loss
(depending upon the circumstances). The United States Federal income tax
treatment of variable notes that are treated as contingent payment debt
instruments will be more fully described in the applicable pricing supplement.
Purchasers of contingent payment debt instruments should carefully examine the
applicable pricing supplement and should consult their own tax advisor with
respect to such notes.
Certain of the notes:
o may be redeemable at the option of the issuing trust prior to their
stated maturity (a "call option"); and/or
o may be repayable at the option of the holder prior to their stated
maturity (a "put option"). Notes containing such features may be
subject to rules that differ from the general rules discussed above.
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Investors intending to purchase notes with such features should consult
their own tax advisors, since the OID consequences will depend, in part, on the
particular terms and features of the purchased notes.
U.S. Holders may generally, upon election, include in income all interest
(including stated interest, acquisition discount, OID, de minimis OID, market
discount, de minimis market discount, and unstated interest, as adjusted by any
amortizable bond premium or acquisition premium) that accrues on a debt
instrument by using the constant yield method applicable to OID, subject to
certain limitations and exceptions.
Short-Term Notes
Notes that have a fixed maturity of one year or less ("short-term notes")
will be treated as having been issued with OID. In general, an individual or
other cash method U.S. Holder is not required to accrue such OID unless the U.S.
Holder elects to do so. If such an election is not made, any gain recognized by
the U.S. Holder on the sale, exchange or maturity of the short-term note will be
ordinary income to the extent of the OID accrued on a straight-line basis, or
upon election under the constant yield method (based on daily compounding),
through the date of sale or maturity, and a portion of the deductions otherwise
allowable to the U.S. Holder for interest on borrowings allocable to the
short-term note will be deferred until a corresponding amount of income is
realized. U.S. Holders who report income for United States Federal income tax
purposes under the accrual method, and certain other holders including banks and
dealers in securities, are required to accrue OID on a short-term note on a
straight-line basis unless an election is made to accrue the OID under a
constant yield method (based on daily compounding).
Market Discount
If a U.S. Holder purchases a note, other than a discount note, for an
amount that is less than its issue price (or, in the case of a subsequent
purchaser, its stated redemption price at maturity) or, in the case of a
discount note, for an amount that is less than its adjusted issue price as of
the purchase date, such U.S. Holder will be treated as having purchased such
note at a "market discount," unless such market discount is less than a
specified de minimis amount.
Under the market discount rules, a U.S. Holder will be required to treat
any partial principal payment (or, in the case of a discount note, any payment
that does not constitute qualified stated interest) on, or any gain realized on
the sale, exchange, retirement or other disposition of, a note as ordinary
income to the extent of the lesser of:
o the amount of such payment or realized gain; and
o the market discount which has not previously been included in income
and is treated as having accrued on such note at the time of such
payment or disposition.
Market discount will be considered to accrue ratably during the period from
the date of acquisition to the maturity date of the note, unless the U.S. Holder
elects to accrue market discount on the basis of semiannual compounding.
A U.S. Holder may be required to defer the deduction of all or a portion of
the interest paid or accrued on any indebtedness incurred or maintained to
purchase or carry a note with market discount until the maturity of the note or
certain earlier dispositions, because a current deduction of such holder's "net
direct interest expense" is only allowed to the extent the interest expense
exceeds an allocable portion of market discount. Net direct interest expense is
the excess of interest paid or accrued to purchase or carry the market discount
note over the interest (including OID) includible in the purchaser's gross
income. A U.S. Holder may elect to include market discount in income currently
as it accrues (on either a ratable or semiannual compounding basis), in which
case the rules described above regarding the treatment as ordinary income of
gain upon the disposition of the note, the receipt of certain cash payments and
the deferral of interest deductions will not apply. Generally, such currently
included market discount is treated as ordinary interest for United States
Federal income tax purposes. Such an election will apply to all debt instruments
acquired by the U.S. Holder on or after the first day of the first taxable year
to which such election applies and may be revoked only with the consent of the
IRS.
Premium
If a U.S. Holder purchases a note for an amount that is greater than the
sum of all amounts payable on the note after the purchase date other than
payments of qualified stated interest, such U.S. Holder will be considered to
have purchased the note with "amortizable bond premium" equal in amount to such
excess. A U.S. Holder may elect to amortize such premium
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using a constant yield method over the remaining term of the note and may offset
interest otherwise required to be included in gross income in respect of the
note during any taxable year by the amortized amount of such excess for the
taxable year. However, if the note may be optionally redeemed after the U.S.
Holder acquires it at a price in excess of its stated redemption price at
maturity, special rules would apply which could result in a deferral of the
amortization of some bond premium until later in the term of the note. Any
election to amortize bond premium applies to all taxable debt instruments held
or acquired by the U.S. Holder on or after the first day of the first taxable
year to which such election applies and may be revoked only with the consent of
the IRS.
Disposition of a Note
Except as discussed above, upon the sale, exchange, redemption (including a
redemption in connection with a tax event), retirement or other disposition of a
note, a U.S. Holder generally will recognize taxable gain or loss equal to the
difference between the amount realized on the sale, exchange, retirement (other
than amounts representing accrued and unpaid interest) or other disposition and
such U.S. Holder's adjusted tax basis in the note. A U.S. Holder's adjusted tax
basis in a note generally will equal such U.S. Holder's initial investment in
the note increased by any OID included in income (and accrued market discount,
if any, if the U.S. Holder has included such market discount in income) and
decreased by the amount of any payments, other than qualified stated interest
payments, received and amortizable bond premium taken into account with respect
to such note. Such gain or loss generally will be long-term capital gain or loss
if the note were held for more than one year. Non-corporate taxpayers are
subject to reduced maximum rates on long-term capital gains and are generally
subject to tax at ordinary income rates on short-term capital gains. The
deductibility of capital losses is subject to certain limitations. Prospective
investors should consult their own tax advisors concerning these tax law
provisions.
Notes Denominated or on which Interest is Payable in a Foreign Currency
The following discussion generally describes special rules that apply, in
addition to the rules described above, to notes that are denominated in, or
provide for payments determined by reference to, a currency other than the
United States dollar (referred to as "foreign currency notes"). This discussion
does not, however, describe the tax considerations relating to the purchase,
ownership or disposition of a foreign currency note that is a contingent payment
debt instrument. A general summary of certain federal income tax considerations
relating thereto will be included in the relevant pricing supplement.
Payments of Interest on a Foreign Currency Note
Cash Method
A U.S. Holder who uses the cash method of accounting for United States
Federal income tax purposes and who receives a payment of interest on a foreign
currency note (other than OID or market discount) will be required to include in
income the U.S. dollar value of the foreign currency payment (determined on the
date such payment is received) regardless of whether the payment is in fact
converted to U.S. dollars at that time, and such U.S. dollar value will be the
U.S. Holder's tax basis in such foreign currency.
Accrual Method
A U.S. Holder who uses the accrual method of accounting for United States
Federal income tax purposes, or who otherwise is required to accrue interest
prior to receipt, will be required to include in income the U.S. dollar value of
the amount of interest income (including OID or market discount and reduced by
amortizable bond premium to the extent applicable) that has accrued and is
otherwise required to be taken into account with respect to a foreign currency
note during an accrual period. The U.S. dollar value of such accrued income will
be determined by translating such income at the average rate of exchange for the
accrual period or, with respect to an accrual period that spans two taxable
years, at the average rate for the partial period within the taxable year. A
U.S. Holder may elect, however, to translate such accrued interest income using
the rate of exchange on the last day of the accrual period or, with respect to
an accrual period that spans two taxable years, using the rate of exchange on
the last day of the taxable year. If the last day of an accrual period is within
five business days of the date of receipt of the accrued interest, a U.S. Holder
may translate such interest using the rate of exchange on the date of receipt.
The above election will apply to other debt obligations held by the U.S. Holder
and may not be changed without the consent of the IRS. A U.S. Holder should
consult a tax advisor before making the above election. A U.S. Holder will
recognize exchange gain or loss (which will be treated as ordinary income or
loss) with respect to accrued interest income on the date such income is
received. The amount of ordinary income or loss recognized will equal the
difference, if any, between the U.S. dollar value of the foreign currency
payment received (determined on the date such payment is
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received) in respect of such accrual period and the U.S. dollar value of
interest income that has accrued during such accrual period (as determined
above).
Purchase, Sale and Retirement of Foreign Currency Notes
A U.S. Holder who purchases a foreign currency note with previously owned
foreign currency will recognize ordinary income or loss in an amount equal to
the difference, if any, between such U.S. Holder's tax basis in the foreign
currency and the U.S. dollar fair market value of the foreign currency used to
purchase the foreign currency note, determined on the date of purchase.
Except as discussed above with respect to short-term notes, upon the sale,
exchange, redemption (including a redemption in connection with a tax event) or
retirement of a foreign currency note, a U.S. Holder will recognize taxable gain
or loss equal to the difference between the amount realized on the sale,
exchange or retirement and such U.S. Holder's adjusted tax basis in the foreign
currency note. Such gain or loss generally will be capital gain or loss (except
to the extent of any accrued market discount not previously included in the U.S.
Holder's income) and will be long-term capital gain or loss if at the time of
sale, exchange or retirement the foreign currency note has been held by such
U.S. Holder for more than one year. To the extent the gain realized represents
accrued but unpaid interest, however, such amounts must be taken into account as
interest income, with exchange gain or loss computed as described in "Payments
of Interest in a Foreign Currency" above. If a U.S. Holder receives foreign
currency on such a sale, exchange or retirement the amount realized will be
based on the U.S. dollar value of the foreign currency on the date the payment
is received or the foreign currency note is disposed of (or deemed disposed of
as a result of a material change in the terms of the foreign currency note). In
the case of a foreign currency note that is denominated in foreign currency and
is traded on an established securities market, a cash basis U.S. Holder (or,
upon election, an accrual basis U.S. Holder) will determine the U.S. dollar
value of the amount realized by translating the foreign currency payment at the
spot rate of exchange on the settlement date of the sale. A U.S. Holder's
adjusted tax basis in a foreign currency note will equal the cost of the foreign
currency note to such U.S. Holder, increased by the amounts of any market
discount or OID previously included in income by the U.S. Holder with respect to
such foreign currency note and reduced by any amortized acquisition or other
premium and any principal payments received by the U.S. Holder. A U.S. Holder's
tax basis in a foreign currency note, and the amount of any subsequent
adjustments to such U.S. Holder's tax basis, will be the U.S. dollar value of
the foreign currency amount paid for such foreign currency note, or of the
foreign currency amount of the adjustment, determined on the date of such
purchase or adjustment.
Gain or loss realized upon the sale, exchange or retirement of a foreign
currency note that is attributable to fluctuations in currency exchange rates
will be ordinary income or loss which will not be treated as interest income or
expense. Gain or loss attributable to fluctuations in exchange rates will equal
the difference between the U.S. dollar value of the foreign currency principal
amount of the foreign currency note, determined on the date such payment is
received or the foreign currency note is disposed of, and the U.S. dollar value
of the foreign currency principal amount of the foreign currency note,
determined on the date the U.S. Holder acquired the foreign currency note. Such
foreign currency gain or loss will be recognized only to the extent of the total
gain or loss realized by the U.S. Holder on the sale, exchange or retirement of
the foreign currency note.
Original Issue Discount
In the case of a discount note or short-term note:
o OID is determined in units of the foreign currency;
o accrued OID is translated into U.S. dollars as described in "Payments
of Interest in a Foreign Currency--Accrual Method" above; and
o the amount of foreign currency gain or loss on the accrued OID is
determined by comparing the amount of income received attributable to
the discount (either upon payment, maturity or an earlier
disposition), as translated into U.S. dollars at the rate of exchange
on the date of such receipt, with the amount of OID accrued, as
translated above.
Premium and Market Discount
In the case of a foreign currency note with market discount:
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o market discount is determined in units of the foreign currency;
o accrued market discount taken into account upon the receipt of any
partial principal payment or upon the sale, exchange, retirement or
other disposition of the foreign currency note (other than accrued
market discount required to be taken into account currently) is
translated into U.S. dollars at the exchange rate on such disposition
date (and no part of such accrued market discount is treated as
exchange gain or loss); and
o accrued market discount currently includible in income by a U.S.
Holder for any accrual period is translated into U.S. dollars on the
basis of the average exchange rate in effect during such accrual
period, and the exchange gain or loss is determined upon the receipt
of any partial principal payment or upon the sale, exchange,
retirement or other disposition of the foreign currency note in the
manner described in "Payments of Interest in a Foreign
Currency--Accrual Method" above with respect to computation of
exchange gain or loss on accrued interest.
With respect to a foreign currency note acquired with amortizable bond
premium, such premium is determined in the relevant foreign currency and reduces
interest income in units of the foreign currency. Although not entirely clear, a
U.S. Holder should recognize exchange gain or loss equal to the difference
between the U.S. dollar value of the bond premium amortized with respect to a
period, determined on the date the interest attributable to such period is
received, and the U.S. dollar value of the bond premium determined on the date
of the acquisition of the foreign currency note.
Exchange of Foreign Currencies
A U.S. Holder will have a tax basis in any foreign currency received as
interest or on the sale, exchange or retirement of a foreign currency note equal
to the U.S. dollar value of such foreign currency, determined at the time the
interest is received or at the time of the sale, exchange or retirement. Any
gain or loss realized by a U.S. Holder on a sale or other disposition of foreign
currency (including its exchange for U.S. dollars or its use to purchase foreign
currency notes) will be ordinary income or loss.
Non-U.S. Holders
Payments of interest (including OID, if any) on a note received by a
non-U.S. Holder that does not hold its notes in connection with the conduct of a
trade or business in the United States, will generally not be subject to United
States Federal withholding tax pursuant to the "Portfolio Interest Exemption"
unless:
o the non-U.S. Holder is a direct or indirect 10% or greater shareholder
of Allstate Life;
o the non-U.S. Holder is a controlled foreign corporation related to
Allstate Life;
o the non-U.S. Holder is a bank receiving interest described in section
881(c)(3)(A) of the Code; or
o interest on the note is contingent interest described in section
871(h)(4) of the Code.
To qualify for the Portfolio Interest Exemption from United States Federal
withholding tax, the last United States payor in the chain of payment prior to
payment to a non-U.S. Holder (the "withholding agent") must have received in the
year in which a payment of interest or principal occurs, or in either of the two
preceding calendar years, a statement that:
o is signed by the beneficial owner of the note under penalties of
perjury;
o certifies that such owner is not a U.S. Holder; and
o provides the name and address of the beneficial owner.
The statement may be made on an IRS Form W-8BEN or a substantially similar
form, and the beneficial owner must inform the withholding agent of any change
in the information on the statement within 30 days of such change. If a note is
held through a securities clearing organization or certain other financial
institutions, the organization or institution may provide a signed statement to
the withholding agent. However, in such a case, the signed statement generally
must be
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accompanied by a copy of the IRS Form W-8BEN or the substitute form provided by
the beneficial owner to the organization or institution.
If a non-U.S. Holder cannot satisfy the requirements for eligibility for
the Portfolio Interest Exemption, interest earned by such non-U.S. Holder will
be subject to United States Federal withholding tax at a 30% rate unless the
non-U.S. Holder provides the withholding agent with a properly executed:
o IRS Form W-8BEN claiming an exemption from or reduction in withholding
under the benefit of a United States income tax treaty; or
o IRS Form W-8ECI stating that interest paid on the note is not subject
to withholding tax because it is effectively connected with the
non-U.S. Holder's conduct of a trade or business in the United States.
Notwithstanding the provision of IRS Form W-8ECI, a non-U.S. Holder that
holds its notes in connection with its conduct of a trade or business in the
United States will be taxed on its notes in the same manner as a U.S. Holder,
and, if such non-U.S. Holder is a foreign corporation, it may also be subject to
a branch profits tax equal to 30% of its effectively connected earnings and
profits for the taxable year, subject to adjustments.
Generally, a non-U.S. Holder will not be subject to United States Federal
income taxes on any amount which constitutes capital gain upon the sale,
exchange, redemption (including a redemption in connection with a tax event),
retirement or other disposition of a note, provided:
o the gain is not effectively connected with the conduct of a trade or
business in the United States by the non-U.S. Holder; and
o the non-U.S. Holder is not an individual who is present in the United
States for 183 days or more during the taxable year.
Certain other exceptions may be applicable, and a non-U.S. Holder should
consult its tax advisor in this regard.
The notes will not be includible in the estate of a non-U.S. Holder unless
the individual is a direct or indirect 10% or greater shareholder of Allstate
Life or, at the time of such individual's death, payments in respect of the
notes would have been effectively connected with the conduct by such individual
of a trade or business in the United States. If any portion of the interest
payable on the notes at the time of the individual's death was contingent
interest, then an appropriate portion of the value of the notes would be
includible in the estate of a non-U.S. Holder.
Backup Withholding and Information Reporting
Backup withholding of United States Federal income tax at the applicable
backup withholding rate may apply to payments made in respect of the notes to
registered owners who are not "exempt recipients" and who fail to provide
certain identifying information (such as the registered owner's taxpayer
identification number) in the required manner. Generally, individuals are not
exempt recipients, whereas corporations and certain other entities generally are
exempt recipients. Payments made in respect of the notes to a U.S. Holder must
be reported to the IRS, unless the U.S. Holder is an exempt recipient or
establishes an exemption. Compliance with the identification procedures
described in the preceding section would establish an exemption from backup
withholding for those non-U.S. Holders who are not exempt recipients.
In addition, upon the sale of a note to (or through) a broker, the broker
must withhold at the applicable backup withholding rate, unless either the
broker determines that the seller is a corporation or other exempt recipient or
the seller provides, in the required manner, certain identifying information
and, in the case of a non-U.S. Holder, certifies that such seller is a non-U.S.
Holder (and certain other conditions are met). Such a sale must also be reported
by the broker to the IRS, unless either the broker determines that the seller is
an exempt recipient or the seller certifies its non-U.S. status (and certain
other conditions are met). Certification of the registered owner's non-U.S.
status would be made normally on an IRS Form W-8BEN under penalties of perjury,
although in certain cases it may be possible to submit other documentary
evidence.
Any amounts withheld under the backup withholding rules from a payment to a
beneficial owner would be allowed as a refund or a credit against such
beneficial owner's United States Federal income tax provided the required
information is furnished to the IRS.
S-58
Opinion Regarding Tax Matters
Prior to the issuance of any notes, Allstate Life will file as an exhibit
to a Current Report on Form 8-K an opinion of legal counsel as described above
regarding the tax treatment of such notes.
S-59
PLAN OF DISTRIBUTION
The notes of a series will be offered to or through one or more of Merrill
Lynch, Pierce, Fenner & Smith Incorporated, A.G. Edwards & Sons, Inc., Banc of
America Securities LLC, Barclays Capital Inc., Bear, Stearns & Co. Inc.,
Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Deutsche Bank
Securities Inc., Goldman, Sachs & Co., Greenwich Capital Markets, Inc., J.P.
Morgan Securities Inc., Lehman Brothers Inc., Morgan Stanley & Co. Incorporated,
UBS Securities LLC and Wachovia Securities LLC (collectively, the "Agents")
pursuant to a terms agreement among Global Funding, the issuing trust and each
Agent named therein (each, a "terms agreement") and the distribution agreement
among Global Funding and the Agents named therein, dated as of February -, 2006
(the "distribution agreement"). Each terms agreement will incorporate by
reference the terms of the distribution agreement. The Agents, individually or
in a syndicate, may purchase notes, as principal, from a trust for resale to
investors and other purchasers at varying prices relating to prevailing market
prices at the time of resale as determined by the applicable Agent or, if so
specified in the applicable pricing supplement, for resale at a fixed offering
price. However, a trust may agree with an Agent for that Agent to utilize its
reasonable efforts on an agency basis on its behalf to solicit offers to
purchase notes at 100% of the principal amount thereof, unless otherwise
specified in the applicable pricing supplement. Unless otherwise specified in
the applicable pricing supplement, each trust will pay a commission to an Agent,
ranging from .150% to .875% of the principal amount of each note, depending upon
its stated maturity, sold through that Agent as its agent. The notes may be sold
to United States and foreign institutional and other investors.
Subject to the terms of the applicable terms agreement and the distribution
agreement, concurrently with any offering of a series of notes by a trust as
described in this prospectus supplement, other trusts may issue other notes
under this program or the Allstate Life(R) CoreNotes(R) program.
Each trust will use the net proceeds received from the issuance of the
related series of notes to purchase a funding note from Global Funding. Global
Funding will use the net proceeds received from the sale of such funding note to
purchase one or more funding agreements issued by Allstate Life. Global Funding
will immediately assign absolutely to, and deposit into, the issuing trust each
such funding agreement and the related funding note will be cancelled
immediately upon the assignment and deposit by Global Funding of such funding
agreement(s) to and into the issuing trust.
Unless otherwise specified in the applicable pricing supplement, any note
sold to an Agent as principal will be purchased by that Agent at a price equal
to 100% of the principal amount thereof less a percentage of the principal
amount equal to the commission applicable to an agency sale of a note of
identical maturity. An Agent may sell notes it has purchased from a trust as
principal to certain dealers less a concession equal to all or any portion of
the discount received in connection with that purchase. An Agent may allow, and
dealers may reallow, a discount to certain other dealers. After the initial
offering of notes, the offering price, the concession and the reallowance may be
changed.
The offer made hereby may be modified without notice, and each trust may
reject offers in whole or in part (whether placed directly by the issuing trust
or through an Agent). Each Agent will have the right, in its discretion
reasonably exercised, to reject in whole or in part any offer to purchase notes
received by it on an agency basis.
Unless otherwise specified in the applicable pricing supplement, you will
be required to pay the purchase price of your notes in immediately available
funds in the specified currency in The City of New York on the date of
settlement.
Upon issuance, the notes of a series will not have an established trading
market. There can be no assurance that a trading market for your notes will ever
develop or be maintained if developed. Unless otherwise specified in the
applicable pricing supplement, the notes will not be listed on any securities
exchange. The Agents may from time to time purchase and sell notes in the
secondary market, but the Agents are not obligated to do so, and there can be no
assurance that a secondary market for the notes will develop or that there will
be liquidity in the secondary market if one develops. From time to time, the
Agents may make a market in the notes, but the Agents are not obligated to do so
and may discontinue any market-making activity at any time.
In connection with an offering of notes purchased by one or more Agents as
principal on a fixed offering price basis, the applicable Agents will be
permitted to engage in certain transactions that stabilize the price of notes.
These transactions may consist of bids or purchases for the purpose of pegging,
fixing or maintaining the price of notes. If those Agents create a short
position in notes (i.e., if they sell notes in an amount exceeding the amount
specified in the applicable pricing supplement), they may reduce that short
position by purchasing notes in the open market. In general, purchases of notes
for the purpose of stabilization or to reduce a short position could cause the
price of notes to be higher than it might be in the absence of these type of
purchases.
S-60
Neither Global Funding and the trusts nor any Agent make any representation
or prediction as to the direction or magnitude of any effect that the
transactions described in the immediately preceding paragraph may have on the
price of notes. In addition, neither Global Funding and the trusts nor any Agent
make any representation that the Agents will engage in any such transactions or
that such transactions, once commenced, will not be discontinued without notice.
The Agents participating in the distribution of notes will be
"underwriters," with respect to the notes being distributed by them and the
funding agreements being purchased by the issuing trust, and any discounts or
commissions received by them on the sale or resale of notes may be deemed to be
underwriting discounts and commissions under the Securities Act. The Agents may
be entitled under agreements entered into with a trust, Global Funding and
Allstate Life to indemnification against certain civil liabilities, including
liabilities under the Securities Act, or to contribution with respect to
payments that the Agents may be required to make in respect of such liabilities.
Global Funding is a statutory issuer of the notes and the funding notes
under the Securities Act, and Allstate Life is the issuer of the funding
agreements under the Securities Act. In addition, under the Securities Act, each
trust is a statutory underwriter of each funding agreement and each funding note
purchased with the proceeds from the issuance of such trust's notes.
J.P. Morgan Trust Company, National Association is affiliated with J.P.
Morgan Securities Inc., which is an Agent. With respect to any series of notes
as to which one or more affiliates of J.P. Morgan Trust Company, National
Association will serve as an Agent, the relevant trust will appoint an eligible
entity other than J.P. Morgan Trust Company, National Association and
unaffiliated with any other Agent participating in the offering of such series
of Notes to serve as indenture trustee.
In the ordinary course of its business, the Agents and their affiliates
have engaged, and may in the future engage, in investment and commercial banking
transactions with Allstate Life and certain of its affiliates.
S-61
ANNEX A
FORM OF PRICING SUPPLEMENT
Filed pursuant to Rule 424(b)[ ]
Registration Statement No. 333-129157
Pricing Supplement No. [ ] Dated [ ]
(To Prospectus dated [ ], and
Prospectus Supplement dated [ ])
CUSIP: [ ]
Allstate Life Global Funding
Secured Medium Term Notes
Issued Through
Allstate Life Global Funding Trust [ ]
The description in this pricing supplement of the particular terms of
the Secured Medium Term Notes offered hereby (the "Notes"), the Funding
Agreement(s) (specified below) issued by Allstate Life Insurance Company
("Allstate Life") and deposited into Allstate Life Global Funding Trust [ ] (the
"Trust") by Allstate Life Global Funding ("Global Funding") and the Funding Note
(specified below) issued by Global Funding to the Trust supplements the
description of the general terms and provisions of the notes, the funding
agreements and the funding notes set forth in the accompanying prospectus and
prospectus supplement, to which reference is hereby made.
The Notes represent the obligation of the Trust and constitute
asset-backed securities within the meaning of Regulation AB under the Securities
Act of 1933, as amended.
THE NOTES
Principal Amount: [ ] Agent(s) Discount: [ ]
Issue Price: [ ] Original Issue Date: [ ]
Net Proceeds to the Trust: [ ] Stated Maturity Date: [ ]
Specified Currency: [ ]
Interest Payment Dates: [ ] Depositary: [The Depository Trust Company]
Initial Interest Payment Date: [ ]
Regular Record Date: [15 calendar days prior to the Interest Payment Date]
Fiscal Year of Trust (not applicable unless different than as specified in the
prospectus and prospectus supplement): [ ]
Type of Interest Rate: [[ ] Fixed Rate] [[ ] Floating Rate]
Fixed Rate Notes: [[ ] Yes] [[ ] No]. If, Yes,
Interest Rate: [ ]
Floating Rate Notes: [[ ] Yes] [[ ] No]. If, Yes,
Regular Floating Rate Notes: [[ ] Yes] [[ ] No]. If, Yes,
Interest Rate: [ ]
Interest Rate Basis(es): [ ]
Inverse Floating Rate Notes: [[ ] Yes] [[ ] No]. If, Yes,
Fixed Interest Rate: [ ]
Floating Interest Rate: [ ]
Interest Rate Basis(es): [ ]
Floating Rate/Fixed Rate Notes: [[ ] Yes] [[ ] No]. If, Yes,
Floating Interest Rate: [ ]
Interest Rate Basis(es): [ ]
Fixed Interest Rate: [ ]
Fixed Rate Commencement Date: [ ]
Initial Interest Rate, if any: [ ]
Initial Interest Reset Date: [ ]
Interest Rate Basis(es). Check all that apply:
[ ] CD Rate [ ] Federal Funds Rate
[ ] CMT Rate [ ] LIBOR
[ ] Commercial Paper Rate [ ] EURIBOR
[ ] Constant Maturity Swap Rate [ ] Prime Rate
[ ] Eleventh District Cost of Funds Rate [ ] Treasury Rate
[ ] Federal Fund Open Rate
[If LIBOR:]
LIBOR Page: [ ]
[ ] LIBOR Moneyline Telerate: [ ] LIBOR Reuters:
LIBOR Currency: [ ]
[If CMT Rate:]
Designated CMT Moneyline Telerate Page: [ ]
[If CMT Moneyline Telerate Page 7052:] [[ ] Weekly Average]
[[ ] Monthly Average]
Designated CMT Maturity Index: [ ]
Index Maturity: [ ]
Spread (+/-): [ ]
Spread Multiplier: [ ]
Interest Reset Date(s): [ ]
Interest Determination Date(s): [ ]
Maximum Interest Rate, if any: [ ]
A-2
Minimum Interest Rate, if any: [ ]
Calculation Agent, if any: [J.P. Morgan Trust Company, National Association]
Exchange Rate Agent, if any: [ ]
Computation of Interest (not applicable unless different than as specified in
the prospectus and prospectus supplement): [ ]
Day Count Convention (not applicable unless different than as specified in the
prospectus and prospectus supplement): [ ]
Amortizing Notes: [[ ] Yes] [[ ] No]. If, Yes,
Amortizing Schedule: [ ]
Additional/Other Terms: [ ]
Discount Notes: [[ ] Yes] [[ ] No]. If, Yes,
Total Amount of Discount: [ ]
Initial Accrual Period of Discount: [ ]
Additional/Other Terms: [ ]
Redemption Provisions: [[ ] Yes] [[ ] No]. If, Yes,
Initial Redemption Date: [ ]
Initial Redemption Percentage: [ ]
Annual Redemption Percentage Reduction (if any):
[ ]
Redemption: [[ ] In whole only and not in part]
[[ ] May be in whole or in part]
Additional/Other Terms: [ ]
Repayment: [[ ] Yes] [[ ] No]. If, Yes,
Repayment Date(s): [ ]
Repayment Price: [ ]
Repayment: [[ ] In whole only and not in part]
[[ ] May be in whole or in part]
Additional/Other Terms: [ ]
Sinking Fund (not applicable unless specified): [ ]
Additional Amounts to be Paid for Withholding Tax (not applicable unless
specified):
Securities Exchange Listing: [[ ] Yes] [[ ] No]. If Yes, Name of Exchange:
Authorized Denominations: [$1,000]
Ratings:
The Notes issued under the Program are rated "AA" by Standard & Poor's, a division of The Mc-Graw Hill Companies, Inc.
("S&P"). It is anticipated that Moody's Investors Service, Inc. ("Moody's") will rate the Notes "Aa2" on the Original
Issue Date.
Agent(s) Purchasing Notes as Principal: [[ ] Yes] [[ ] No]. If Yes,
Agent(s) Principal Amount
[ ] [ ]
Total: [ ]
A-3
Agent(s) Acting as Agent: [[ ] Yes] [[ ] No]. If Yes,
Agent(s) Principal Amount
[ ] [ ]
Total: [ ]
Additional/Other Terms: [ ]
Special Tax Considerations: [ ]
THE FUNDING AGREEMENT(S)
Funding Agreement Issuer: Allstate Life Insurance Company
Funding Agreement No.: [ ]
Deposit Amount: [ ]
Issue Price: [ ]
Net Deposit Amount: [ ]
Effective Date: [ ]
Specified Currency: [ ]
Interest Payment Dates: [ ]
Initial Interest Payment Date: [ ]
Type of Interest Rate: [[ ] Fixed Rate] [[ ] Floating Rate]
Fixed Rate Funding Agreement: [[ ] Yes] [[ ] No]. If Yes,
Interest Rate: [ ]
Floating Rate Funding Agreement: [[ ] Yes] [[ ] No]. If Yes,
Floating Rate Funding Agreement: [[ ] Yes] [[ ] No]. If Yes,
Interest Rate: [ ]
Interest Rate Basis(es): [ ]
Inverse Floating Rate Funding Agreement: [[ ] Yes] [[ ] No]. If Yes,
Fixed Interest Rate: [ ]
Floating Interest Rate: [ ]
Interest Rate Basis(es): [ ]
Floating Rate/Fixed Rate Funding Agreement: [[ ] Yes] [[ ] No]. If Yes,
Floating Interest Rate: [ ]
Interest Rate Basis(es): [ ]
Fixed Interest Rate: [ ]
Fixed Rate Commencement Date: [ ]
Initial Interest Rate, if any: [ ]
A-4
Initial Interest Reset Date: [ ]
Interest Rate Basis(es). Check all that apply:
[ ] CD Rate
[ ] CMT Rate [ ] Commercial Paper Rate
[ ] Constant Maturity Swap Rate [ ] Eleventh District Cost of Funds Rate
[ ] LIBOR [ ] Federal Funds Open Rate
[ ] EURIBOR [ ] Federal Funds Rate
[ ] Prime Rate [ ] Treasury Rate
[If LIBOR:]
LIBOR Page: [ ]
[ ] LIBOR Moneyline Telerate: [ ] LIBOR Reuters:
LIBOR Currency: [ ]
[If CMT Rate:]
Designated CMT Moneyline Telerate Page: [ ]
[[ ] Weekly Average]
[If CMT Moneyline Telerate Page 7052:] [[ ] Monthly Average]
Designated CMT Maturity Index: [ ]
Index Maturity: [ ]
Spread (+/-): [ ]
Spread Multiplier: [ ]
Interest Reset Date(s): [ ]
Interest Determination Date(s): [ ]
Maximum Interest Rate, if any: [ ]
Minimum Interest Rate, if any: [ ]
Calculation of Interest: [ ]
Day Count Convention: [ ]
Amortizing Funding Agreement: [[ ] Yes] [[ ] No]. If Yes,
Amortizing Schedule
Additional/Other Terms
Additional/Other Terms: [ ]
A-5
Discount Funding Agreement: [[ ] Yes] [[ ] No]. If Yes,
Total Amount of Discount: [ ]
Initial Accrual Period of Discount: [ ]
Additional/Other Terms: [ ]
Redemption Provisions: [[ ] Yes] [[ ] No]. If Yes,
Initial Redemption Date: [ ]
Initial Redemption Percentage: [ ]
Annual Redemption Percentage Reduction
(if any): [ ]
Redemption: [[ ] In whole only and not in part]
[[ ] May be in whole or in part]
Additional/Other Terms: [ ]
Repayment: [[ ] Yes] [[ ] No]. If Yes,
Repayment Date(s): [ ]
Repayment Price: [ ]
Repayment: [[ ] In whole only and not in part]
[[ ] May be in whole or in part]
Additional/Other Terms: [ ]
Sinking Fund (not applicable unless specified): [ ]
Additional Amounts to be Paid For Withholding Tax (not applicable
unless specified): [ ]
Ratings:
The Funding Agreements issued under the Program are rated AA by S&P. It is
anticipated that the Funding Agreement(s) will be rated Aa2 by Moody's on the
Original Issue Date.
Additional/Other Terms, if any: [ ]
Special Tax Considerations: [ ]
THE FUNDING NOTE
Funding Note Issuer: Allstate Life Global Funding
Funding Note No.: [ ]
Principal Amount: [ ]
The Funding Note will otherwise have payment and other terms substantially
similar to the Funding Agreement(s) and the Notes, except that the terms of the
Funding Note will provide that it will be cancelled immediately upon the sale
of, and deposit into, the Trust by Global Funding of the Funding Agreement(s).
A-6
===============================================================================
$5,000,000,000
Allstate Life Global Funding
Depositor
Secured Medium Term Notes
Due Between Nine Months and 30 Years From the Date of Issue
Issued Through
Allstate Life Global Funding Trusts
Secured by
Funding Agreements Issued by
Allstate Life Insurance Company
Sponsor
------------------
PROSPECTUS SUPPLEMENT
------------------
Merrill Lynch & Co.
A.G. Edwards & Sons, Inc.
Banc of America Securities LLC
Barclays Capital
Bear, Stearns & Co. Inc.
Citigroup
Credit Suisse
Deutsche Bank Securities
Goldman, Sachs & Co.
JPMorgan
Lehman Brothers
Morgan Stanley
RBS Greenwich Capital
UBS Investment Bank
Wachovia Securities
-, 2006
===============================================================================
Subject to Completion
Preliminary Prospectus Supplement dated February -, 2006
PROSPECTUS SUPPLEMENT
(To prospectus dated February -, 2006)
$5,000,000,000
Allstate Life Global Funding
Depositor
Allstate Life(R) CoreNotes(R)
Due Between Nine Months and 30 Years From the Date of Issue
Issued Through Allstate Life Global Funding Trusts
Secured by
Funding Agreements Issued by
Allstate Life Insurance Company
Sponsor
------------------
Allstate Life Global Funding (the "depositor" or "Global Funding") is a
statutory trust formed under the laws of the State of Delaware. Its primary
purpose is to facilitate the programs for the issuance of one or more series of
secured medium term notes, including the Allstate Life(R) CoreNotes(R) (the
"notes"). Each series of notes will be issued by a newly created separate and
distinct Delaware statutory trust (each, a "trust"). The notes of each series
will be secured by one or more funding agreements (each, a "funding agreement")
issued by Allstate Life Insurance Company ("Allstate Life") and assigned
absolutely to, and deposited into, the issuing trust by Global Funding. Global
Funding will be the sole beneficial owner of each trust that is formed and the
depositor of the funding agreements into the issuing trusts. In connection with
each offering of notes, Allstate Life Global Funding will issue the applicable
funding note (each, a "funding note") as more fully described herein. Allstate
Life is the sponsor of the programs.
The notes of each series will represent the obligations of the issuing
trust and will constitute "asset-backed securities" within the meaning of
Regulation AB under the Securities Act of 1933, as amended.
The specific terms of each series of notes, and the related funding note
and funding agreement(s), will be set forth in a separate prospectus supplement
to this prospectus supplement and the accompanying prospectus (a "pricing
supplement"), which will be prepared in connection with the issuance of such
series of notes, including the information related to the interest rate or
specified rate of return thereof, the distribution frequency and the first
expected distribution date. The form of pricing supplement, which includes
bracketed alternatives that may form part of the structure of an offering of
notes pursuant to the program described in this prospectus supplement and the
accompanying prospectus, is included in this prospectus supplement as Annex B.
You should read this prospectus supplement, the accompanying prospectus and the
applicable pricing supplement carefully before you invest.
The notes of each series:
o will be issued in only one class;
o will represent the unconditional, direct, non-recourse, secured and
unsubordinated obligations of the issuing trust only and will not
represent the obligations of, or interest in, any other trust, Global
Funding, Allstate Life or any of their respective affiliates;
o will have a stated maturity of nine months to 30 years from the date
of issue;
o will have redemption and/or repayment provisions, if applicable,
whether mandatory or at the option of the issuing trust or the holders
of such notes;
o will provide for payments in U.S. dollars;
o will, unless otherwise specified in the applicable pricing supplement,
have a minimum denomination of $1,000 and integral multiples of $1,000
in excess thereof;
o will be in book-entry form;
o will bear interest at fixed or floating rates; unless otherwise
specified in the applicable pricing supplement, each trust will pay
interest on the relevant series of notes on a monthly, quarterly,
semiannual or annual basis;
o will be secured by the right, title and interest of the issuing trust
in and to (1) the funding agreement(s) held by that trust, (2) all
proceeds of such funding agreement(s) and (3) all books and records
pertaining to such funding agreement(s); and
o may be sold in the United States to retail and other investors.
The funding note and funding agreement(s) issued in connection with the
offering of a series of notes will represent the respective obligations of
Global Funding and Allstate Life only and will not represent the obligations of
or the interest in any person other than the respective issuing entity.
Each class of securities offered may have an aggregate principal amount of
up to $5,000,000,000.
Investing in these securities involves risks that are described in the
"Risk Factors" section beginning on page S-[ ].
------------------
Neither the Securities and Exchange Commission, any state securities
commission nor any state insurance commission has approved or disapproved of
these securities or determined if this prospectus supplement, the accompanying
prospectus or any pricing supplement is truthful or complete. Any representation
to the contrary is a criminal offense.
------------------
Merrill Lynch & Co.
------------------
The date of this prospectus supplement is -, 2006.
"Allstate Life(R)" is a registered service mark of Allstate Insurance Company.
"CoreNotes(R)" is a registered service mark of Merrill Lynch & Co., Inc.
TABLE OF CONTENTS
Page
Prospectus Supplement
Forward-Looking Statements..............................................................................................S-1
About this Prospectus Supplement and the Pricing Supplements............................................................S-2
Summary.................................................................................................................S-3
Risk Factors...........................................................................................................S-12
Allstate Life Global Funding Trusts....................................................................................S-18
Allstate Life Global Funding...........................................................................................S-18
Allstate Life Insurance Company........................................................................................S-19
Description of the Notes...............................................................................................S-20
Description of the Funding Agreements..................................................................................S-42
United States Federal Income Tax Considerations........................................................................S-43
Plan of Distribution...................................................................................................S-50
Annex A: Survivor Option Repayment Election Form......................................................................A-1
Annex B: Form of Pricing Supplement...................................................................................B-1
Prospectus
Forward-Looking Statements................................................................................................1
About this Prospectus.....................................................................................................2
Available Information.....................................................................................................3
Incorporation of Documents by Reference...................................................................................3
Description of Allstate Life Global Funding and the Trusts................................................................5
Description of Allstate Life Insurance Company...........................................................................16
Computation of Ratio of Earnings to Fixed Charges........................................................................17
Use of Proceeds..........................................................................................................17
Description of the Notes.................................................................................................18
Description of the Indentures............................................................................................19
Description of the Funding Notes.........................................................................................30
Description of the Funding Agreements....................................................................................31
Description of the Support and Expenses Agreements.......................................................................37
Description of the Administrative Services Agreements....................................................................38
ERISA Considerations.....................................................................................................39
Plan of Distribution.....................................................................................................42
Legal Opinions...........................................................................................................43
Experts..................................................................................................................43
------------------
Each trust may sell its notes to the Purchasing Agent referred to below as
principal for resale at a fixed offering price specified in the applicable
pricing supplement or at varying prices. Each trust may also explicitly agree
with the Purchasing Agent that it will use its reasonable efforts as agent on
behalf of the issuing trust to solicit offers to purchase notes of the
applicable series from that trust at 100% of the principal amount thereof,
unless otherwise specified in the applicable pricing supplement. Unless
otherwise specified in the applicable pricing supplement, any note sold to the
Purchasing Agent as principal will be purchased by the Purchasing Agent at a
price equal to 100% of the principal amount thereof less a percentage of the
principal amount equal to the commission applicable to an agency sale of a note
of identical maturity. Unless otherwise specified in the applicable pricing
supplement, each trust will pay a commission to the Purchasing Agent, ranging
from .125% to 2.50% of the principal amount of each applicable note, depending
upon its stated maturity, for each note purchased from the issuing trust by the
Purchasing Agent as its agent.
You should rely only on the information contained or incorporated by
reference in this prospectus supplement, the accompanying prospectus and any
pricing supplement. Neither of the registrants nor the Purchasing Agent has
authorized anyone to provide you with different or additional information. If
anyone provides you with different or additional information, you should not
rely on it. Neither of the registrants nor the Purchasing Agent is making an
offer to sell notes in any jurisdiction where the offer or sale is not
permitted. You should not assume that the information contained in this
prospectus supplement, the accompanying prospectus or the applicable pricing
supplement is accurate as of any date other than the date of such document.
Updated information will be provided in the future as explained under
"Incorporation of Documents by Reference" in the accompanying prospectus.
FORWARD-LOOKING STATEMENTS
Allstate Life
This prospectus supplement, the accompanying prospectus and each applicable
pricing supplement may include forward-looking statements of Allstate Life.
These forward-looking statements are not statements of historical fact but
rather reflect Allstate Life's current expectations, estimates and predictions
about future results and events. These statements may use words such as "will,"
"should," "likely," "target," "anticipate," "believe," "estimate," "expect,"
"intend," "predict," "project" and similar expressions as they relate to
Allstate Life or its management. When Allstate Life makes forward-looking
statements, Allstate Life is basing them on its management's beliefs and
assumptions, using information currently available to Allstate Life. These
forward-looking statements are subject to risks, uncertainties and assumptions,
including but not limited to, risks, uncertainties and assumptions discussed in
this prospectus supplement, the accompanying prospectus and in each applicable
pricing supplement. Factors that can cause or contribute to these differences
include those described under the heading "Risk Factors" in this prospectus
supplement. Allstate Life undertakes no obligation to publicly update or revise
any forward-looking statements, whether as a result of new information, future
events, developments or otherwise.
If one or more of these or other risks or uncertainties materialize, or if
Allstate Life's underlying assumptions prove to be incorrect, actual results may
vary materially from what Allstate Life projected. Any forward-looking
statements of Allstate Life you read in this prospectus supplement, the
accompanying prospectus or any pricing supplement reflect Allstate Life's
current views with respect to future events and are subject to these and other
risks, uncertainties and assumptions relating to Allstate Life's operations,
results of operations, growth strategy and liquidity. All subsequent written and
oral forward-looking statements attributable to Allstate Life or individuals
acting on Allstate Life's behalf are expressly qualified in their entirety by
this section. You should specifically consider the factors identified in this
prospectus supplement, the accompanying prospectus and each applicable pricing
supplement which could cause actual results to differ before making an
investment decision.
Global Funding and the Trusts
This prospectus supplement, the accompanying prospectus and each applicable
pricing supplement may include forward-looking statements of Global Funding and
the trusts. These forward-looking statements are subject to risks, uncertainties
and assumptions, including but not limited to, risks, uncertainties and
assumptions discussed in this prospectus supplement, the accompanying prospectus
and in each applicable pricing supplement. Global Funding does not, and the
trusts will not, undertake any obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.
You should specifically consider the factors identified in this prospectus
supplement, the accompanying prospectus and each applicable pricing supplement
before making an investment decision. The trusts are not entitled to the safe
harbors contained in Section 27A of the Securities Act of 1933, as amended (the
"Securities Act") and Section 21E of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), with respect to forward-looking statements of the
trusts in this prospectus supplement, the accompanying prospectus and each
applicable pricing supplement.
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ABOUT THIS PROSPECTUS SUPPLEMENT AND THE PRICING SUPPLEMENTS
This document is a prospectus supplement and supplements a prospectus which
is part of a registration statement filed with the Securities and Exchange
Commission (the "SEC") by Allstate Life Global Funding and Allstate Life
Insurance Company (the "registrants"). This prospectus supplement provides you
with a general description of the notes. The trusts may sell notes in various
offerings up to an aggregate initial offering price of $5,000,000,000, less any
amount of notes previously issued by the trusts under this program or pursuant
to a separate prospectus supplement that relates to the Allstate Life Global
Funding secured medium term note program. References in this prospectus
supplement to "notes" are to the Allstate Life(R) CoreNotes(R) offered by this
prospectus supplement.
This prospectus supplement and the information incorporated by reference in
it may update, supplement or clarify the information in the accompanying
prospectus. You will also receive a pricing supplement with the prospectus
supplement. The pricing supplement will contain the specific description of the
notes offered at the time and the terms on which the notes are offered. That
pricing supplement also may add, update, supplement or clarify information in
this prospectus supplement and the accompanying prospectus. You should carefully
review such additional, updated, supplemental or clarifying information
contained in the pricing supplement.
It is important for you to read and consider all of the information
contained in this prospectus supplement and the accompanying prospectus, as well
as in the applicable pricing supplement relating to the particular offering of
notes, in making your decision to invest in notes. You should also read and
consider the information in the documents referred to in "Incorporation of
Documents by Reference" in the accompanying prospectus.
In this prospectus supplement, references to the "depositor" and "Global
Funding" are to Allstate Life Global Funding. References to the "trusts" are to
Allstate Life Global Funding Trusts. References to an "issuing trust" are to a
trust with respect to the series of notes issued and sold to the public by that
trust. These references are not to Allstate Life Insurance Company. Unless
otherwise specified herein or the context otherwise requires, in this prospectus
supplement, references to "Allstate Life" are to Allstate Life Insurance
Company. References to "Purchasing Agent" are to Merrill Lynch, Pierce, Fenner &
Smith Incorporated.
In this prospectus supplement, references to "United States dollars," "U.S.
dollars" or "$" are to lawful currency of the United States of America.
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SUMMARY
This section summarizes certain of the legal and financial terms of the
notes, funding notes and funding agreements that are described in more detail in
"Description of the Notes" and "Description of the Funding Agreements" beginning
on pages S-[ ] and S-[ ] of this prospectus supplement, "Description of the
Funding Notes" beginning on page [ ] of the accompanying prospectus, and other
information described elsewhere in this prospectus supplement or in the
accompanying prospectus. You should read the more detailed information appearing
elsewhere in the accompanying prospectus, this prospectus supplement and the
applicable pricing supplement relating to the particular offering of notes.
The Trusts...................... Each series of notes will be issued by a newly created separate and distinct Delaware
statutory trust (each, a "trust") formed by Allstate Life Global Funding, as trust
beneficial owner, AMACAR Pacific Corp., as administrator (including any successor, the
"administrator"), and Wilmington Trust Company, as Delaware trustee (including any
successor, the "Delaware trustee"), pursuant to the filing of a certificate of trust and
the execution of a trust agreement. Each trust agreement pursuant to which various trusts
may be formed from time to time to issue notes is referred to in this prospectus
supplement as a "trust agreement." Allstate Life Global Funding will be the sole
beneficial owner of each trust that is formed.
Depositor; Issuer of Funding
Notes......................... Allstate Life Global Funding is a registrant as the depositor of the funding agreements
into the issuing trusts and the issuer of the funding notes.
Sponsor; Issuer of Funding
Agreements................... Allstate Life Insurance Company is the sponsor of the programs and a registrant as the
issuer of the funding agreements.
Allstate Life is not affiliated with any trust. None of Allstate Life or any of its
officers, directors, subsidiaries or affiliates owns any beneficial interest in any trust
nor has any of these persons or entities entered into any agreement with any trust other
than in furtherance of the issuance of notes from time to time as contemplated by this
prospectus supplement and the accompanying prospectus.
None of Allstate Life or any of its officers, directors, subsidiaries or affiliates is
affiliated with Global Funding, the Delaware trustee, the administrator, the indenture
trustee or the funding note indenture trustee.
Purposes of Global Funding and
Trusts....................... The primary purpose of Global Funding is to facilitate the programs for the issuance of
notes, including, in connection with each offering of notes, to issue the applicable
funding note. The primary purpose of each trust is to issue the related series of notes
to the public, which notes will be issued only on the original issue date of such notes
and will be secured by one or more funding agreements issued by Allstate Life, and
assigned absolutely to, and deposited into, the issuing trust by Global Funding. Each
trust will use the net proceeds received from issuing its series of notes to acquire one
or more funding agreements. Each trust will hold the collateral described below
pertaining to its series of notes to fund its obligations under that series of notes.
Each trust will pledge and collaterally assign the funding agreement(s) held in that
trust to the indenture trustee for the benefit of the holders of that trust's series of
notes and any other person for whose benefit the indenture trustee is or will be holding
the applicable collateral.
The notes of each series will represent the obligations of the issuing trust only and
will not represent the obligations of, or interest in, any other trust, Global Funding,
Allstate Life, or any of their respective affiliates. Holders of notes of a series may
only look to the funding agreement(s) and any other collateral held in, or pledged and
collaterally assigned to the indenture trustee by, the issuing trust for payment on
their notes and not to the assets of Allstate Life or Global Funding, or the assets held in
any other trust.
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Delaware Trustee................ Unless otherwise specified in the applicable pricing supplement, Wilmington Trust
Company, a Delaware banking corporation, will be the sole trustee of Global Funding and
each trust. In this prospectus supplement and the accompanying prospectus, references to
"Delaware trustee" (i) with respect to any trust are to Wilmington Trust Company (or
another entity specified in the applicable trust agreement), as Delaware trustee of such
trust (including, in each case, any successor); and (ii) with respect to Global Funding
are to Wilmington Trust Company as Delaware trustee of Global Funding (including any
successor). The Delaware trustee will not be obligated in any way to make payments under
or in respect of any notes, any funding notes or any funding agreements. The Delaware
trustee is not affiliated with Allstate Life or the indenture trustee.
Administrator................... Unless otherwise specified in the applicable pricing supplement, AMACAR Pacific Corp.
will be the administrator of Global Funding and each trust. In this prospectus supplement
and the accompanying prospectus, references to the "administrator" (i) with respect to
any trust are to AMACAR Pacific Corp. (or another entity specified in the applicable
trust agreement), as administrator of such trust (including, in each case, any
successor); and (ii) with respect to Global Funding are to AMACAR Pacific Corp. as
administrator of Global Funding (including any successor). The administrator will not be
obligated in any way to make any payments under or in respect of the notes, any funding
notes or any funding agreements. The administrator is not affiliated with Allstate Life
or the indenture trustee.
Indenture Trustee............... Each series of notes will be issued by the issuing trust pursuant to a separate indenture
(each, an "indenture") to be entered into among the issuing trust and J.P. Morgan Trust
Company, National Association, (or another entity specified as indenture trustee in the
applicable indenture) in its capacity as indenture trustee (including any successor, the
"indenture trustee"). The indenture trustee will not be affiliated with the trusts, the
Delaware trustee, the administrator, Global Funding or Allstate Life.
Funding Note Indenture
Trustee....................... Each funding note will be issued by Global Funding pursuant to a separate funding note
indenture (each, a "funding note indenture") to be entered into among Global Funding and
the other parties specified therein, including J.P. Morgan Trust Company, National
Association, (or another entity specified as funding note indenture trustee in the
applicable funding note indenture) in its capacity as funding note indenture trustee
(including any successor, the "funding note indenture trustee"). The funding note
indenture trustee is not affiliated with the trusts, the Delaware Trustee, the
administrator, Global Funding or Allstate Life.
Servicer........................ Unless otherwise provided in the pricing supplement for a series of notes, pursuant to
each indenture, J.P. Morgan Trust Company, National Association will perform the
functions of the servicer in respect of the programs.
Diagram of Parties.............. Below is a diagram showing the parties involved in the issuance of notes by each trust.
Funding Agreement(s)
Deposit of Funding Agreement(s)
--- into issuing trust. Funding note --- Security Interest in
| is simultaneously cancelled. | Funding Agreement(s)
| | (held for the benefit
Funding | | of holders)
Agreement(s) | Funding Note |
- ------------------- ----------------- ---------------- --------------
|Allstate Life |---------------> |Allstate Life |------------------>| | ---------------- | Indenture |
|Insurance Company|<-------------- |Global Funding |<----------------- | Issuing Trust| | Trustee |
- ------------------- Note Proceeds ----------------- Note Proceeds ---------------- --------------
^ |
| |
Note
Proceeds Notes
| |
| v
----------------
| |
| Noteholders |
----------------
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Allstate Life Can Issue Its Own
Medium Term Notes and Funding
Agreements Directly to
Investors.................... Allstate Life is able to issue its own medium term notes directly to investors and does
issue funding agreements directly to qualified investors. However, by securing each
trust's notes with one or more of Allstate Life's funding agreements, such trust's notes
are secured by an asset that would have a higher priority in insolvency than unsecured
medium term notes of Allstate Life and, accordingly, may be entitled to receive a higher
investment rating than unsecured medium term notes of Allstate Life. In addition, funding
agreements are very difficult to transfer and have no active secondary market. By
securing each trust's notes with one or more of Allstate Life's funding agreements,
investors may be able to avail themselves of many of the benefits of Allstate Life's
funding agreements while benefiting from the liquidity afforded by each trust's medium
term notes.
Title Allstate Life(R) CoreNotes(R)
Purchasing Agent Merrill Lynch, Pierce, Fenner & Smith Incorporated.
Allstate Life(R) CoreNotes(R)
Program...................... This prospectus supplement relates to one or more series of notes that one or Delaware
special purpose statutory trusts that may be formed from time to time may issue and sell
primarily to retail investors under this Allstate Life(R) CoreNotes(R) program.
Allstate Life(R) CoreNotes(R) will be offered from time to time to the public, with payment
of principal of, any premium and interest on,and any other amounts due and owing with
respect to, the Allstate Life(R) CoreNotes(R) to be secured by one or more applicable
funding agreements issued by Allstate Life and sold to, and deposited into, the issuing
trust by Global Funding.
Secured Medium Term Notes
Program...................... Included in the registration statement, of which this prospectus supplement is a part,
is another prospectus supplement relating to series of notes that may be issued and sold
primarily to institutional investors by one or more newly established Delaware statutory
trusts under the related secured medium term notes program. The terms of the secured
medium term notes are identical in all material respects to the terms of the notes
to be sold under this program, as described in this prospectus supplement, except that
the secured medium term notes:
o may be issued as amortizing notes;
o may be denominated in one or more foreign currencies;
o will not contain a survivor's option, permitting optional repayment of notes of
a series, subject to certain limitations, prior to maturity, if requested, following
the death of the beneficial owner of notes of that series; and
o may contain a provision providing for the redemption of the notes if Allstate Life is
required to pay additional amounts on the related funding agreements pursuant to the
applicable pricing supplement and Allstate Life exercises its right to redeem the
funding agreements.
Amount of the Notes............. Up to $5,000,000,000 of notes less any amount of notes previously issued under this
program, the related secured medium term note program or otherwise under the accompanying
prospectus.
Flow of Funds................... All funds deposited with the indenture trustee pursuant to an indenture in respect of
notes of a series, except when an event of default has occurred and is continuing under
the indenture, shall be held in trust in the applicable collection account and applied by
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the indenture trustee, in accordance with the provisions of the notes of such series and
the applicable indenture, to the payment through any paying agent, to the persons
entitled thereto, of the principal, premium, if any, interest and additional amounts, if
any, for whose payment such money has been deposited with or received by the indenture
trustee. If no event of default with respect to the notes of a series has occurred and
is continuing, the following priority of payments shall apply:
o First: to the payment of principal, any premium and interest, any additional
amounts, and any other amounts then due and owing on the notes
of such series, ratably, without preference or priority
of any kind, according to the aggregate amounts due and payable on such notes;
o Second: to the payment of any other obligations then due and owing with respect
to such series of notes, ratably, without preference or priority of any kind; and
o Third: to the payment of any remaining balance to the issuing trust for
distribution by the Delaware Trustee in accordance with the provisions of
the applicable trust agreement.
Any funds collected by the indenture trustee following an event of default, and during the
continuance thereof, under the applicable indenture in respect of the notes of a series
shall be held in trust in the applicable collection account and be applied in the
following order at the date or dates fixed by the indenture trustee and, in case of the
distribution of such funds on account of principal, any premium and interest and any
other amounts due and owing, upon presentation of the global security or
certificates representing the notes of such series and the notation thereon of the
payment if only partially paid or upon the surrender thereof if fully paid:
o First: to the payment of costs and expenses, including reasonable compensation
to the indenture trustee and each predecessor indenture trustee and their respective
agents and attorneys and of all expenses and liabilities incurred, and all advances
made, by the indenture trustee and each predecessor indenture trustee except as those
adjudicated in a court of competent jurisdiction to be the result of any such
indenture trustee's negligence or bad faith, in an aggregate amount of no more than
$250,000 for all series of notes outstanding;
o Second: to the payment of principal, any premium and interest, any additional
amounts and any other amounts then due and owing on the notes of such series, ratably,
without preference or priority of any kind, according to the aggregate amounts due and
payable on such notes;
o Third: to the payment of any other obligations then due and owing with respect to such
series of notes, ratably, without preference or priority
of any kind; and
o Fourth: to the payment of any remaining balance to the issuing trust for distribution
by the Delaware Trustee in accordance with the provisions of the applicable trust
agreement.
All funds and other property received by the Delaware trustee on behalf of the issuing
trust in respect of the applicable collateral will be deposited into the payment account of
such trust and will be distributed by such trust as follows:
o First: to the indenture trustee for the payment of all amounts then due and
unpaid upon the applicable series of notes and any other amounts due and
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payable, in accordance with the applicable indenture; and
o Second: upon the final redemption of the applicable series of notes and payment of
any amounts payable in respect thereof, any remaining funds and other property
deposited into the payment account shall be distributed to the Delaware trustee for
distribution as provided below.
In connection with the termination of any trust that is formed and the distribution of
all amounts from the applicable payment account in accordance with the priority
described above, the Delaware trustee will distribute any amounts received in accordance
with the second clause of the immediately preceding paragraph and any other remaining
assets of the trust in the following order of priority:
o First: to pay all expenses and other liabilities owed by the applicable trust;
and
o Second: any remaining funds and other property shall be paid to the trust
beneficial owner.
Terms of the Notes:
Status....................... o The notes of a series will represent the unconditional, direct, non-recourse and
unsubordinated obligations of the issuing trust and will rank equally among
themselves.
o Each series of notes may be accelerated in the payment of principal and outstanding
interest if an event of default under the notes of such series occurs. Upon the
occurrence of an event of default, the indenture trustee on behalf of
the holders of notes of such series may only proceed against the collateral held in the
issuing trust.
o The notes of each series are not intended to be insurance contracts, insurance policies
or funding agreements.
o The notes of each series will represent the obligations of the issuing trust only
and will not represent the obligations of, or interest in, any other trust, Global
Funding, Allstate Life or any of their respective affiliates.
o The notes are not guaranteed by any person or entity.
o The notes will not benefit from any insurance guaranty fund coverage or any similar
protection.
Interest Rate................ o Each series of fixed rate notes will bear interest from its date of issue at the
rate stated in the applicable pricing supplement until the principal is
paid. Each series of floating rate notes will bear interest from the date
of issue until the principal is paid at a rate determined by reference to
an interest rate or interest rate formula, which may be adjusted by a
spread and/or spread multiplier (each as more fully described under
"Description of the Notes"). The pricing supplement for a series of
floating rate notes will designate one or more of the following base rates,
along with the index maturity for that base rate:
o the CD Rate,
o the CMT Rate,
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o the Commercial Paper Rate,
o the Constant Maturity Swap Rate
o the Federal Funds Open Rate
o the Federal Funds Rate,
o LIBOR,
o the Prime Rate, or
o the Treasury Rate.
o Interest on each note will be payable either monthly, quarterly, semiannually or
annually on each interest payment date and at maturity or, if applicable, earlier
redemption or repayment, and will be computed on the basis of a 360-day year of twelve
30-day months, unless otherwise specified in the pricing supplement.
Principal.................... o The principal amount of each note will be payable on its stated maturity date
specified in the applicable pricing supplement, unless earlier redeemed or
repaid in accordance with its terms.
Redemption................... Unless otherwise specified in the applicable pricing supplement:
o the notes will not be redeemable prior to maturity; and
o the notes will not be subject to any sinking fund.
Maturities................... o Each series of notes will mature between nine months and 30 years from its date
of original issuance. Each series of notes will have the same maturity date
as the related funding agreement(s).
Survivor's Option............ A series of notes may contain a provision (which is referred to as the "survivor's
option") permitting optional repayment of notes of that series prior to maturity, if
requested, following the death of the beneficial owner of notes of that series, so long
as the notes were held by the beneficial owner or the estate of the beneficial owner for
a period beginning at least six months immediately prior to such death. Your notes may
not be repaid in this manner unless the pricing supplement for your series of notes
provides for the survivor's option. If the pricing supplement for your series of notes
provides for the survivor's option, the funding agreement securing your series of notes
will contain a provision which will allow the issuing trust to tender the funding
agreement in whole or in part to Allstate Life. An issuing trust's ability to tender
funding agreements related to its series of notes that contains a survivor's option,
however, will be subject to certain limitations set by Allstate Life. As a result, your
right to exercise the survivor's option is subject to limits set by Allstate Life with
respect to the relevant funding agreement. Allstate Life has the discretionary right to
limit the aggregate principal amount of:
o all funding agreements securing all outstanding series of notes issued under the
Allstate Life(R) CoreNotes(R) program as to which exercises of any put option
by any issuing trust shall be accepted by Allstate Life in any calendar
year to an amount equal to the greater of $2,000,000 or 2% of the aggregate
principal amount of all funding agreements securing all outstanding series
of notes issued under the Allstate Life(R) CoreNotes(R) program as of the end
of the most recent calendar year or such other greater amount as determined
in accordance with the applicable funding agreement and set forth in the
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applicable pricing supplement;
o the funding agreements securing the notes of a series as to which exercises of any put
option by the applicable trust attributable to notes as to which the survivor's
option has been exercised by the authorized representative of any individual deceased
beneficial owner to $250,000 in any calendar year or such other greater amount as
determined in accordance with the applicable funding agreement and set forth
in the applicable pricing supplement; and
o the funding agreements securing a series of notes as to which exercises of any put
option by the applicable trust attributable to notes as to which the survivor's option
has been exercised shall be accepted in any calendar year to an amount as set forth in
the applicable funding agreement and the applicable pricing supplement.
Additional details on the survivor's option are described in the section titled
"Description of the Notes--Survivor's Option" on page S-[ ].
Currency and Denominations...... Notes will be denominated in U.S. dollars. Unless otherwise specified in the applicable
pricing supplement, notes will be issued and sold in denominations of $1,000 and integral
multiples of $1,000 in excess thereof.
Listing of Notes................ Unless otherwise specified in the applicable pricing supplement, a series of notes will
not be listed on any securities exchange.
Forms of Notes.................. Book-entry through the facilities of The Depository Trust Company ("DTC"), except as
otherwise described under "Description of the Notes--Book-Entry Notes."
Collateral...................... The notes of a series will be secured by the right, title and interest of the issuing
trust in and to (1) the funding agreement(s) held by that trust, (2) all proceeds of such
funding agreement(s) and (3) all books and records pertaining to such funding
agreement(s). In this prospectus supplement, references to "other collateral" are to
items (2) and (3) above.
Funding Agreements.............. The funding agreements are unsecured obligations of Allstate Life, an Illinois stock life
insurance company. In the event of insolvency of an Illinois insurance company, claims
against the insurer's estate are prioritized pursuant to Section 5/205 of the Illinois
Insurance Code. Under Section 5/205(1)(d) of the Illinois Insurance Code, claims by
"policyholders, beneficiaries, and insureds, under insurance policies, annuity contracts,
and funding agreements" receive payment prior to any distribution to general creditors
not falling within any other priority class under the Illinois Insurance Code.
The registrants believe that in a properly prepared and presented case in a delinquency
proceeding under Article XIII of the Illinois Insurance Code, 215 ILCS Section 5/187 et
seq. (the "Illinois Liquidation Act"), the timely and properly filed claims of an owner
under the funding agreement (with the possible exception of claims for Additional
Amounts, as discussed below) would be entitled to distribution pari passu with claims
made by other policyholders, beneficiaries, and insureds under other insurance policies,
insurance contracts, annuities and funding agreements issued by Allstate Life, and the
claims of the Illinois Life and Health Insurance Guaranty Association, and any similar
organization in another state, in accordance with Section 5/205(1)(d) of the Illinois
Liquidation Act, and an owner's claims under the funding agreement should not be
recharacterized as other than the claims of a policyholder, beneficiary, or insured under
an insurance policy, insurance contract, annuity or funding agreement.
The obligations of Allstate Life under any funding agreement will not be guaranteed by
any person or entity.
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If a funding agreement so provides, Allstate Life may be required to pay Additional
Amounts (as such term is defined therein) to the indenture trustee as collateral assignee
of the funding agreement. For a discussion regarding payment of Additional Amounts, see
"Description of the Notes--Withholding Tax; No Payment of Additional Amounts." Although
such payments could be viewed as a claim under the funding agreements within the
meaning of Section 5/205(1)(d), they may also be argued to be a separate payment
obligation. Therefore, while in a proceeding before a court of competent jurisdiction the
court might find that a claim for an Additional Amount constitutes a claim under a
funding agreement, it also might find that such a claim is not a claim entitled to the
priority afforded by Section 5/205(1)(d). If a claim for an Additional Amount does not
constitute a claim entitled to the priority afforded by Section 5/205(1)(d), then in a
properly prepared and presented case any claim for an Additional Amount would be
entitled to the same priority as claims of general creditors of Allstate Life under
Section 5/205(1)(g).
With respect to the issuance of any series of the notes, the aggregate amount of Allstate Life's
liabilities that would rank pari passu with each funding agreement securing such series
of notes is disclosed in the financial statements of Allstate Life contained in
Allstate Life's most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q
filed with the SEC, in each case as of the date of such financial statements. This
amount appears in the Consolidated Statements of Financial Position as a liability under
the line item entitled "Contractholder funds."
Terms of the Funding Notes...... Each trust will use the net proceeds received from the issuance of the related series of
notes to purchase a funding note in definitive form (each, a "funding note") from Global
Funding. Each funding note will have a principal amount equal to the principal amount of
the related series of notes. Each funding note will otherwise have payment and other
terms substantially similar to the related series of notes, except that each funding note
will contain a provision that makes it immediately cancelable upon the assignment and
deposit by Global Funding of the related funding agreement(s) to the related issuing
trust. Such cancellation shall operate as a redemption and satisfaction of such funding
note.
Terms of the Funding
Agreements.................... Global Funding will use the net proceeds received from the sale of the related funding
note to purchase one or more funding agreements issued by Allstate Life. Global
Funding will immediately pledge and collaterally assign each such funding
agreement to the funding note indenture trustee and immediately thereafter assign
absolutely to, and deposit into, the issuing trust each such funding agreement. The
funding agreement(s) will have a principal amount equal to the principal amount of the
related series of notes. The funding agreement(s) will otherwise have payment and
other terms substantially similar to the related series of notes.
Withholding Tax................. All amounts due in respect of the notes of a series will be made without any applicable
withholding or deduction for or on account of any present or future taxes, duties,
levies, assessments or other governmental charges of whatever nature imposed or levied by
or on behalf of any governmental authority, unless such withholding or deduction is
required by law. Unless otherwise specified in the applicable pricing supplement, neither
the notes of the applicable series nor the related funding note or funding agreement(s)
will provide for the payment of additional amounts relating to any required withholding
or deduction imposed or levied on payments in respect of a series of notes or the related
funding note or funding agreement(s). As a result, unless otherwise specified in the
applicable pricing supplement, the risk of any such withholding or deduction, whether or
not as a result of a change in law or otherwise, will be borne by the holders of such
series of notes.
Ratings......................... Unless otherwise indicated in the applicable pricing supplement, it is expected that each
series of notes, and the related funding note and the funding agreement(s) securing such
series of notes will have an issue credit rating of "AA" from Standard & Poor's Ratings
Services, a division of The McGraw-Hill Companies, Inc. ("Standard & Poor's"). It is
expected that the program will be rated "Aa2" by Moody's Investors Service, Inc.
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("Moody's") and "AA" by Standard & Poor's.
If Moody's or Standard & Poor's changes the program rating, the new program rating will be
specified in the applicable pricing supplement. Notes of a series will be issued under the
program only in the event that, at the time of issuance of such series of notes, at least one
nationally recognized rating agency would assign an investment grade rating to such series of
notes, the related funding note and the funding agreement(s) securing such series of notes.
Fees and Expenses............... Allstate Life and Global Funding entered into an amended and restated support and
expenses agreement dated as of February -, 2006 (the "depositor support agreement").
Pursuant to the depositor support agreement, Allstate Life agreed, among other things, to
pay certain costs and expenses relating to the offering, sale and issuance of each
funding note and certain costs, expenses and taxes of Global Funding. Pursuant to the
depositor trust agreement, Allstate Life also agreed to indemnify each service provider
of Global Funding, as well as Global Funding, with respect to certain matters.
In connection with the issuance of a series of notes, Allstate Life and the issuing trust
will enter into a support and expenses agreement (each, a "support agreement"). Under
each support agreement, Allstate Life will agree to pay certain costs and expenses
relating to the offering, sale and issuance of the applicable series of notes and certain
costs, expenses and taxes of the issuing trust. Pursuant to each support agreement,
Allstate Life will also agree to indemnify each service provider of the issuing trust, as
well as the issuing trust, with respect to certain matters.
It is anticipated that the indenture trustee fees for this program will be approximately
$- annually.
Governing Law................... The notes, each indenture, each funding note and each funding note indenture will be
governed by, and construed in accordance with, the laws of the State of New York. The
depositor trust agreement is, and each trust agreement will be, governed by, and
construed in accordance with, the laws of the State of Delaware. The funding agreements
will be governed by the laws of the State of Illinois.
United States Federal Income
Tax Considerations............ Special tax counsel to Global Funding will render its opinion that under current law and
based on certain facts and assumptions contained in such opinion, for United States
Federal income tax purposes, Global Funding and each trust will be ignored and that the
notes will be classified as indebtedness of Allstate Life. Each holder and beneficial
owner of the notes, by purchase of the notes, agrees to such treatment. Accordingly,
holders of the notes generally will have the same United States federal income tax
consequences from the purchase of the notes as they would had they purchased a debt
obligation issued directly by Allstate Life. Prospective purchasers of the notes must
carefully consider the tax consequences of the ownership and disposition the notes set
forth under "United States Federal Income Tax Considerations."
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RISK FACTORS
Your investment in the notes includes risks. In consultation with your own
financial and legal advisers, you should carefully consider, among other
matters, the following discussion of risks before deciding whether an investment
in the notes is suitable for you. The notes are not an appropriate investment
for you if you do not understand their significant components and/or financial
matters. You should also consult the discussion of risk factors set forth in
Allstate Life's most recent Annual Report on Form 10-K, which is incorporated
into this prospectus supplement and the accompanying prospectus by reference.
Risk Factors Relating to the Depositor and the Trusts
Each trust will have limited resources and therefore its ability to make timely
payments with respect to its series of notes will depend upon Allstate Life
making payments under the relevant funding agreement
The ability of a trust to make timely payments with respect to the related
series of notes is principally dependent upon Allstate Life making the related
payments under each relevant funding agreement. Each trust is a special purpose
statutory trust formed for the purpose of the issuance of the related series of
notes. The obligations under a series of notes will be secured by and payable
solely from the collateral held in the issuing trust. No holder of a series of
notes will have any right to receive payments from the collateral related to any
other series of notes.
The notes of a series will represent the obligations only of the issuing trust
only and will not represent the obligations of, or be guaranteed by, Allstate
Life or any of its affiliates
The notes will not represent the obligations of Allstate Life, Global
Funding or any other person or entity other than the issuing trust. The notes
will not be guaranteed by any person or entity. Except pursuant to the terms of
the funding agreement(s) included in the collateral for each series of notes,
none of these entities nor any agent, trustee or beneficial owner of Global
Funding or the trusts, in respect of any trust, is under any obligation to
provide funds or capital to Global Funding or the trusts or with respect to any
series of notes issued by the trusts. The net worth of Global Funding on the
date hereof is approximately $1,000 and is not expected to increase materially.
The net worth of each trust is expected to be minimal.
Global Funding is and the trusts will be special purpose entities and, as of the
date of issue of any series of notes, the issuing trust will have, no prior
operating history
Global Funding is and the trusts will be special purpose statutory trusts
organized under the laws of the State of Delaware. Global Funding exists for the
primary purpose of facilitating the programs for the issuance of notes. Each
trust will exist for the exclusive purposes of: issuing and selling one series
of notes to investors; using the net proceeds from the sale of series of notes
to acquire the related collateral, including one or more funding agreements; and
engaging in other activities necessary or incidental thereto. As of the date of
issue of any series of notes, the issuing trust will have, no prior operating
history.
Risk Factors Relating to the Notes
The notes of a series represent non-recourse obligations of the issuing trust
The obligations under the notes of a series represent non-recourse
obligations payable solely from the applicable collateral constituting the
assets of the issuing trust. If any event of default shall occur under any
series of the notes, the rights of the holders of the notes of such series and
the indenture trustee, on behalf of such holders, will be limited to a
proceeding against the applicable collateral. None of such holders or the
indenture trustee will have the right to proceed against the collateral related
to any other series of notes, Global Funding, any other trust or any of Allstate
Life, its officers, directors, affiliates, employees or agents or any of the
trustees, beneficial owners or agents, or any of their respective officers,
directors, affiliates, employees or agents in the case of any judgment in which
there is deficiency remaining after foreclosure of any property included in such
collateral. If an event of default shall have occurred under a series of notes,
the indenture trustee will be entitled to have its fees and expenses paid solely
from the collateral of such series of notes before holders of the notes of such
series receive payment of the amounts then due and owing with respect to their
notes; provided, that such priority of the indenture trustee over the holders of
the notes of a series will be limited to an aggregate amount of no more than
$250,000 for all series of notes. All claims of the holders of a series of notes
in excess of amounts received from the related collateral will be extinguished.
In the absence of an event of default under a funding agreement, the occurrence
of an event of default under the related series of notes will not give rise to
any right to accelerate such applicable funding agreement. In that event, it is
possible that the obligations under the applicable series of notes may be
accelerated while the obligations of Allstate Life
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under the applicable funding agreement(s) would not be similarly accelerated. If
this occurs, the indenture trustee may have no or limited ability to proceed
against the applicable funding agreement(s) and the related collateral and
holders of the notes may not be paid in full, or in a timely manner upon such
acceleration. See "Description of the Indentures--Events of Default" in the
accompanying prospectus.
Allstate Life will be the sole obligor under the funding agreements
Since Allstate Life will be the sole obligor under the funding agreements,
the ability of a trust to meet its obligations, and your ability to receive
payments from such trust, with respect to a particular series of notes, will be
principally dependent upon Allstate Life's ability to perform its obligations
under each applicable funding agreement held by the issuing trust. Despite this,
you will have no direct contractual rights against Allstate Life under any such
funding agreement. Pursuant to the terms of each funding agreement, recourse
rights to Allstate Life will belong to the issuing trust, its successors and
permitted assignees. In connection with the offering and sale of a series of
notes, the issuing trust will pledge, collaterally assign and grant a security
interest in the collateral for such series of notes to the indenture trustee on
behalf of the holders of the applicable series of notes and the other persons
identified in the relevant indenture. Recourse to Allstate Life under each such
funding agreement will be enforceable only by the indenture trustee as a secured
party for the benefit of holders of such series of notes and any other person
for whose benefit the indenture trustee is or will be holding the collateral.
Accordingly, if Allstate Life fails to perform its obligations under the
applicable funding agreement(s), your ability to receive payments from the
issuing trust would be materially and adversely affected.
Nonetheless, since Allstate Life is a registrant, purchasers of notes may
be able to proceed directly against Allstate Life to enforce their rights under
the Federal securities laws and their rights under the Federal securities laws
will be no different than if they purchased the underlying funding agreements
directly from Allstate Life.
The notes could be deemed to be participations in the funding agreements or
could otherwise be deemed to be contracts of insurance and holders of the notes
could be found to be acting as insurance agents or brokers
The laws and regulations of each state of the United States and the
District of Columbia (the "covered jurisdictions") contain broad definitions of
the activities that may constitute the conduct of the business of insurance in
such jurisdictions. Because the primary asset of each trust will be one or more
funding agreements issued by Allstate Life, which will be sold to, and deposited
into, the issuing trust by Global Funding, it is possible that a trust's
issuance of notes, Global Funding's issuance of the related funding note or the
performance of the issuing trust's obligations under the notes, including the
payment or prepayment of amounts due under the notes, or the purchase, resale or
assignment of the notes by any investor or any person who acquires the notes
directly or indirectly from such investor;
o could be characterized by one or more covered jurisdictions as the
conduct of the business of insurance by Global Funding, the issuing
trust, any such investor or any such other person or
o could otherwise subject Global Funding, the issuing trust, any such
investor or any such other person to regulation under the insurance
laws of one or more covered jurisdictions.
This could, among other effects, require such persons to be subject to
regulatory licensure or other qualifications and levels of compliance that
cannot practically be achieved. Failure to comply with such requirements could
subject any such person to regulatory penalties. In the event Global Funding or
any trust is subject to any such penalties or any other liabilities resulting
from such regulation, the ability of holders to receive payment under the notes
could be materially and adversely affected. In addition, any such failure to
comply or the threat of any such regulation could reduce liquidity with respect
to the notes, prevent an investor from transferring notes and reduce the
marketability and market value of the notes. Therefore, any such regulation or
threat of regulation by any one or more covered jurisdictions could result in an
investor either being unable to liquidate its investment in the notes or, upon
any such liquidation, receiving a value significantly less than the initial
investment in the notes.
The Illinois Department of Insurance has confirmed that it does not
consider the sale of publicly offered funding agreement backed medium term notes
to violate the Illinois Insurance Code. In addition, the Illinois Department of
Insurance has approved the form of funding agreement to be used in connection
with each offering of notes.
Based primarily upon communications with the staff of the insurance
regulatory bodies in most states and the legal advice of LeBoeuf, Lamb, Greene &
MacRae LLP, Allstate Life and Global Funding believe that:
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o the notes should not be subject to regulation as participations in the
funding agreements themselves or otherwise constitute insurance
contracts under the insurance laws of the covered jurisdictions; and
o Global Funding, the trusts and persons selling or purchasing the notes
should not be subject to regulation as doing an insurance business
under the insurance laws of the covered jurisdictions by virtue of
their respective activities in connection with the offer, sale and/or
purchase of the notes.
There are, however, wide variations in the insurance laws of the covered
jurisdictions, subtle nuances in their application, and a general absence of any
consistent pattern of interpretation or enforcement. Insurance regulatory
authorities have broad discretionary powers in administering the insurance laws,
including the authority to modify or withdraw a regulatory interpretation,
impose new rules, and take a position contrary to Allstate Life's. In addition,
state courts are not bound by any regulatory interpretations and could take a
position contrary to Allstate Life's. Consequently, there can be no assurance
that the purchase, resale or assignment of the notes or the funding notes will
not subject the parties to such transaction to regulation or enforcement
proceedings under the insurance laws of one or more covered jurisdictions.
Payments under funding agreements may be insufficient to pay principal and
interest, if any, under the notes
Payments of the principal of and any interest on a series of notes will be
made solely from the payments the issuing trust receives under the applicable
funding agreement(s). Unless otherwise specified in this prospectus supplement
or the applicable pricing supplement, Allstate Life will not pay any Additional
Amounts (as defined in the applicable funding agreement) in respect of a funding
agreement to compensate for any withholding or deduction for or on account of
any present or future taxes, duties, levies, assessments or governmental charges
of whatever nature imposed or levied on payments in respect of a funding
agreement, by or on behalf of any governmental authority and each holder of a
note of the related series of notes will be deemed for all purposes to have
received cash in an amount equal to the portion of such withholding or deduction
that is attributable to such holder's interest in the notes, as equitably
determined by the issuing trust. Under this circumstance, the issuing trust will
not actually pay, or cause to be paid, to such holder all of the amounts which
would have been receivable by such holder in the absence of such taxes, duties,
levies, assessments or other governmental charges.
Redemption may adversely affect your return on the notes
If your notes are redeemable at the option of the issuing trust, it may
choose to redeem your notes at times when prevailing interest rates are
relatively low. In addition, if your notes are subject to mandatory redemption,
the issuing trust may be required to redeem your notes also at times when
prevailing interest rates are relatively low. As a result, you may not be able
to reinvest the redemption proceeds in a comparable security at an interest rate
equal to the interest rate on your notes being redeemed.
There may not be any trading market for your notes; many factors affect the
trading and market value of your notes
Upon issuance, the notes of a series will not have an established trading
market. No assurance can be given that a trading market for your notes will ever
develop or be maintained if developed. In addition to the creditworthiness of
Allstate Life and the issuing trust, many factors affect the trading market for,
and trading value of, your notes. These factors include:
o the time remaining to the maturity of your notes;
o the outstanding amount of the applicable series of notes;
o any redemption features of your notes; and
o the level, direction and volatility of market interest rates
generally.
There may be a limited number of buyers if you decide to sell your notes.
This may affect the price you receive for your notes or your ability to sell
your notes at all. In addition, notes that are designed for specific investment
objectives or strategies often experience a more limited trading market and more
price volatility than those not so designed. You should not purchase notes
unless you understand and know you can bear all of the investment risks
involving your notes.
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Ratings of this Allstate Life(R) CoreNotes(R) program described in this
prospectus supplement and the accompanying prospectus, the related medium term
note program and each series of notes may not reflect all risks of an investment
in the notes
Each series of notes will be rated by at least one nationally recognized
statistical rating organization. The ratings of such notes will primarily
reflect the financial strength of Allstate Life and will change in accordance
with the rating of Allstate Life's financial strength and with any change in the
priority status under Illinois law of funding agreements. Any rating is not a
recommendation to purchase, sell or hold any particular security, including the
notes. Such ratings do not comment as to market price or suitability for a
particular investor. In addition, there can be no assurance that a rating will
be maintained for any given period of time or that a rating will not be lowered
or withdrawn in its entirety. The ratings of this Allstate Life(R) CoreNotes(R)
program described in this prospectus supplement and the accompanying prospectus,
the related medium term note program and each series of notes may not reflect
the potential impact of all risks related to structure and other factors on any
trading market for, or trading value of, your notes.
Any survivor's option may be subject to certain limitations
Under the Allstate Life(R) CoreNotes(R) program, Allstate Life has the
discretionary right to limit the aggregate principal amount of:
o all funding agreements securing all outstanding series of notes as to
which exercises of any put option by any issuing trust shall be
accepted by Allstate Life in any calendar year to an amount equal to
the greater of $2,000,000 or 2% of the aggregate principal amount of
all funding agreements securing all outstanding series of notes issued
under the Allstate Life(R) CoreNotes(R) program as of the end of the
most recent calendar year or such other greater amount as determined
in accordance with the applicable funding agreement(s) and set forth
in the applicable pricing supplement;
o the funding agreement(s) securing the notes of a series as to which
exercises of any put option by the applicable trust attributable to
notes as to which the survivor's option has been exercised by the
authorized representative of any individual deceased beneficial owner
to $250,000 in any calendar year or such other greater amount as
determined in accordance with the applicable funding agreement(s) and
set forth in the applicable pricing supplement; and
o the funding agreement(s) securing a series of notes as to which
exercises of any put option by the applicable trust shall be accepted
in any calendar year to an amount as set forth in the applicable
funding agreement(s) and the applicable pricing supplement.
In any such event, each trust shall similarly be required to limit the
aggregate principal amount of notes as to which exercises of the survivor's
option shall be accepted by it. Accordingly, no assurance can be given that the
exercise of the survivor's option for a desired amount will be accepted as to
any series of notes or in any single calendar year.
An increase in market interest rates could result in a decrease in the value of
any notes bearing interest at a fixed rate
If market interest rates increase above the interest rate of notes bearing
interest at a fixed rate, such notes bearing interest at a fixed rate generally
decline in value because debt instruments of the same face value priced at
market interest rates will yield higher income. Consequently, if you purchase
fixed rate notes and market interest rates increase above the fixed interest
rate on the notes you have purchased, the market value of your notes may
decline. No assurance can be given regarding the future level of market interest
rates.
If you purchase discount notes, the amount payable to you upon early redemption,
repayment or acceleration of these notes may be less than the principal amount
(i.e., par) of the notes plus accrued but unpaid interest and premium, if any
If you purchase discount notes, the amount payable to you upon early
redemption, repayment or acceleration of these notes may be less than the
principal amount thereof plus accrued and unpaid interest. The amount payable
will be determined by the formula set forth in this prospectus supplement or the
applicable pricing supplement.
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Risk Factors Relating to the Collateral
The funding agreements are unsecured obligations of Allstate Life. If the
funding agreements were not determined to be insurance contracts, they would be
accorded the same priority in an insolvency of Allstate Life as its other
general unsecured obligations
The primary assets of each trust will be one or more funding agreements,
and payments on the notes of a series will principally depend on payments under
each related funding agreement(s). In addition, each trust will grant a security
interest in, pledge and assign as collateral each funding agreement it acquires
with the proceeds from the offering of a series of notes together with the
related collateral to the indenture trustee, for the benefit of the holders of
the notes of such series and any other person for whose benefit the indenture
trustee is or will be holding the collateral, to secure the obligations under
that series of notes.
In the event of insolvency of an Illinois insurance company, claims against
the insurer's estate are prioritized pursuant to Section 5/205 of the Illinois
Insurance Code. Under Section 5/205(1)(d) of the Illinois Insurance Code, claims
by "policyholders, beneficiaries, and insureds, under insurance policies,
annuity contracts, and funding agreements" receive payment prior to any
distribution to general creditors not falling within any other priority class
under the Illinois Insurance Code. The funding agreements are unsecured
obligations of Allstate Life.
In a properly prepared and presented case in a delinquency proceeding under
Article XIII of the Illinois Insurance Code, 215 ILCS Section 5/187 et seq. (the
"Illinois Liquidation Act"), the timely and properly filed claims of an owner
under the funding agreement (with the possible exception of claims for
Additional Amounts, as discussed below) would be entitled to distribution pari
passu with claims made by other policyholders, beneficiaries, and insureds under
other insurance policies, insurance contracts, annuities and funding agreements
issued by Allstate Life, and the claims of the Illinois Life and Health
Insurance Guaranty Association, and any similar organization in another state,
in accordance with Section 5 /205(1)(d) of the Illinois Liquidation Act, and an
owner's claims under the funding agreement should not be recharacterized as
other than the claims of a policyholder, beneficiary, or insured under an
insurance policy, insurance contract, annuity or funding agreement.
In the absence of controlling judicial precedents, the opinion of Lord,
Bissell & Brook LLP is based on a reasoned analysis of Illinois statutes, as
well as application of other states' judicial decisions involving similar or
analogous circumstances, and is subject to the limitations, qualifications and
assumptions set forth in its opinion letter. Investors should note that in the
event of the insolvency of an insurance company, however, the judicial
application of statutes governing the distribution of the insurer's general
assets has typically proceeded on a case-by-case basis.
Additional Amounts may be considered a separate payment obligation and may not
be subject to the same priority as other amounts claimed under the funding
agreements
If a funding agreement so provides, Allstate Life may be required to pay
Additional Amounts (as such term is defined therein) to the indenture trustee as
collateral assignee of the funding agreement. Although such payments could be
viewed as a claim under the funding agreements within the meaning of Section
5/205(1)(d), they may also be argued to be a separate payment obligation.
Therefore, while in a proceeding before a court of competent jurisdiction, the
court might find that a claim for an Additional Amount constitutes a claim under
a funding agreement, it also might find that such a claim is not a claim
entitled to the priority afforded by Section 5 /205(1)(d). Lord, Bissell & Brook
LLP has opined that if a claim for an Additional Amount does not constitute a
claim entitled to the priority afforded by Section 5/205(1)(d), then in a
properly prepared and presented case any claim for an Additional Amount would be
entitled to the same priority as claims of general creditors of Allstate Life
under Section 5/205(1)(g). Accordingly, in the event of the insolvency of
Allstate Life, your claim for any payments of Additional Amounts may be
subordinated to claims for other amounts under the applicable funding agreement.
Changes in Federal tax legislation could adversely affect Allstate Life's business
Under the Internal Revenue Code of 1986, as amended (the "Code"), United
States Federal income tax payable by policyholders on investment earnings is
deferred during the accumulation period of certain life insurance and annuity
products. Thus, taxes, if any, are payable on income attributable to a
distribution under the contract for the year in which the distribution is made.
This favorable tax treatment may give certain of Allstate Life's products a
competitive advantage over other noninsurance products. On May 28, 2003,
President Bush signed the Jobs and Growth Tax Relief Reconciliation Act of 2003,
which reduces the federal income tax rates applicable to certain dividends and
capital gains realized by individuals. This legislation may lessen the
competitive advantage of certain of Allstate Life's products vis-a-vis other
investments that generate dividend and/or capital gain income. As a result,
demand for certain of Allstate Life's products that offer income tax
S-16
deferral may be negatively impacted. Additionally, Congress has from time to
time considered other legislation that would reduce or eliminate the benefits to
policyowners of the deferral of taxation on the accretion of value within
certain insurance products or otherwise affect the taxation of insurance
products and insurance companies. To the extent that the Code is revised to
reduce the tax deferred status of insurance products, or to reduce the taxation
of competing products, all life insurance companies, including Allstate Life,
could be adversely affected.
S-17
ALLSTATE LIFE GLOBAL FUNDING TRUSTS
Each series of notes will be issued by a newly created separate and
distinct trust formed by Global Funding, the administrator and the Delaware
trustee pursuant to the filing of a certificate of trust and the execution of
the applicable trust agreement. Global Funding will be the sole beneficial owner
of each trust that is formed.
After formation, each trust will not engage in any activity other than:
o issuing and selling a single series of notes;
o immediately acquiring a funding note and immediately surrendering such
funding note for cancellation pursuant to its terms in exchange for
one or more funding agreement(s);
o acquiring, holding and maintaining the applicable funding
agreement(s);
o pledging, assigning as collateral and granting a security interest in
the applicable funding agreement(s) to the indenture trustee;
o making payments on the applicable series of notes; and
o engaging in other activities that are necessary, suitable or
convenient to accomplish the foregoing or are incidental to or
connected with those activities.
The principal executive offices of the trusts will be located at Allstate
Life Global Funding Trusts, c/o: AMACAR Pacific Corp., 6525 Morrison Boulevard,
Suite 318, Charlotte, North Carolina 28211. The telephone number will be (704)
365-0569. For more information about the trusts, see "Description of Allstate
Life Global Funding and the Trusts" in the accompanying prospectus.
ALLSTATE LIFE GLOBAL FUNDING
Global Funding is a special purpose statutory trust existing under the laws
of the State of Delaware. The primary purpose of Global Funding is to serve as
depositor for the programs.
Global Funding will not engage in any activity other than:
o beneficially owning the trusts;
o issuing one or more funding notes;
o acquiring one or more funding agreements from Allstate Life;
o pledging, assigning as collateral and granting a security interest in
the applicable funding agreement(s) to the funding note indenture
trustee;
o assigning absolutely the funding agreement(s) to, and depositing such
funding agreement(s) into, the trusts; and
o engaging in other activities that are necessary, suitable or
convenient to accomplish the foregoing or are incidental to or
connected with those activities.
The principal executive offices of Global Funding are located at Allstate
Life Global Funding, c/o: AMACAR Pacific Corp., 6525 Morrison Boulevard, Suite
318, Charlotte, North Carolina 28211. The telephone number is (704) 365-0569.
For more information about Global Funding, see "Description of Allstate Life
Global Funding and the Trusts" in the accompanying prospectus.
S-18
ALLSTATE LIFE INSURANCE COMPANY
Allstate Life was organized in 1957 as a stock life insurance company under
the laws of the State of Illinois. It conducts substantially all of its life
insurance operations directly or through wholly owned United States
subsidiaries. It is a wholly owned subsidiary of Allstate Insurance Company
("AIC"), a stock property-liability insurance company organized under the laws
of the State of Illinois. All of the outstanding stock of AIC is owned by The
Allstate Corporation, a publicly owned holding company incorporated under the
laws of the State of Delaware.
The Allstate Corporation, together with its subsidiaries, is the second
largest personal property and casualty insurer in the United States on the basis
of 2004 statutory premiums earned. Widely known through the "You're In Good
Hands With Allstate(R)" slogan, The Allstate Corporation, through its
subsidiaries, provides insurance products to approximately 17 million households
and has approximately 14,100 exclusive agencies and financial specialists in the
United States and Canada. For more information about Allstate Life, see
"Description of Allstate Life Insurance Company" in the accompanying prospectus.
Allstate Life's principal executive offices are located at 3100 Sanders
Road, Northbrook, Illinois 60062 and its telephone number is (847) 402-5000.
S-19
DESCRIPTION OF THE NOTES
This section provides a summary description of the material provisions of
the notes. Each series of notes will be issued pursuant to a separate indenture
(each, an "indenture") to be entered into among the issuing trust and the other
parties specified therein, including J.P. Morgan Trust Company, National
Association, or another entity specified therein as the indenture trustee in the
indenture (including, in each case, any successor, the "indenture trustee"). The
provisions of the notes are not restated in their entirety and you should read
the actual provisions set forth in the standard indenture terms filed as an
exhibit to the registration statement of which this prospectus supplement and
the accompanying prospectus form a part because those provisions, and not this
description, will define your rights as an owner of an interest in the notes of
a series. The terms and conditions of the notes described in this section will
apply to each series of notes, except that the specific terms of a series of
notes will be added in the applicable pricing supplement and each book-entry
(each, a "note certificate") representing the notes of such series. It is
important for you to consider the information contained in this prospectus
supplement, the accompanying prospectus, the applicable indenture, the
applicable pricing supplement and the note certificates in making your
investment decision.
This section describes some technical concepts and occasionally contains
defined terms. You should refer to the standard indenture terms and the forms of
note certificates filed as exhibits to the registration statement to which this
prospectus supplement and the accompanying prospectus relate for the full
description of those concepts and complete definitions of those terms.
General
Indentures
Each trust will issue its series of notes subject to and entitled to the
benefits of a separate indenture. Each indenture will be subject to, qualified
under and governed by, the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"). The aggregate principal amount of notes that may be
authenticated and delivered under each indenture will be unlimited. For a
description of the indentures, see "Description of the Indentures" beginning on
page [ ] of the accompanying prospectus.
Collateral
Pursuant to each indenture, the issuing trust will pledge and collaterally
assign each funding agreement held by it to the indenture trustee for the
benefit of the holders of the notes issued by such trust and any other person
for whose benefit the indenture trustee is or will be holding the collateral (as
defined below) for such series of notes. Each series of notes will be secured by
a first priority perfected security interest in the "collateral" for such series
of notes in favor of the indenture trustee, for the benefit of the holders of
the notes of such series and any other person for whose benefit the indenture
trustee is or will be holding the collateral, which will consist of the right,
title and interest of the issuing trust in and to:
o the funding agreement(s) held by the issuing trust;
o all proceeds of the relevant funding agreement(s); and
o all books and records pertaining to the relevant funding agreement(s).
Ranking
The notes of a series will represent the unconditional, direct,
non-recourse and unsubordinated obligations of the issuing trust and will rank
equally among themselves. The notes of each series will represent the
obligations of the issuing trust only and will not represent the obligations of,
or interest in, any other trust, Global Funding, Allstate Life or any of their
respective affiliates.
Pricing Supplement
The pricing supplement relating to the offering of a series of notes will
describe, among other things, the following terms of the notes, including:
o the principal amount of the notes;
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o whether the notes are:
o fixed rate notes;
o floating rate notes, and/or discount notes that do not bear any
interest currently or bear interest at a rate that is below
market rates at the time of issuance;
o the price at which the notes will be issued, which will be expressed
as a percentage of the aggregate principal amount or face amount;
o the original issue date on which the notes will be issued;
o the stated maturity date;
o if the notes are fixed rate notes, the rate per annum at which the
notes will bear any interest and the interest payment date frequency;
o if the notes are floating rate notes, relevant terms such as: the
interest rate basis or interest rate bases, the initial interest rate,
the interest reset period or the interest reset dates, the interest
payment dates, the index maturity, any maximum interest rate, the
minimum interest rate, the spread and/or spread multiplier, and any
other terms relating to the particular method of calculating the
interest rate for the notes and whether and how the spread and/or
spread multiplier may be changed prior to the stated maturity date;
o whether the authorized representative of the beneficial owner of a
beneficial interest in the notes will have the right to seek repayment
upon the death of the beneficial owner as described under
"--Survivor's Option" on page S-[ ];
o whether the notes may be redeemed by the issuing trust, or repaid at
the option of the holders, prior to the stated maturity date and the
terms of their redemption or repayment, provided that any such
redemption or repayment will be accompanied by the simultaneous
redemption or repayment of the relevant funding agreement(s);
o any special United States federal income tax considerations relating
to the purchase, ownership and disposition of the notes; and
o any other terms of the notes provided in the accompanying prospectus
to be set forth in a pricing supplement or that are otherwise
consistent with the provisions of the indenture under which the notes
will be issued.
The pricing supplement also may add, update, supplement or clarify
information in this prospectus supplement and the accompanying prospectus. The
form of pricing supplement is included in this prospectus supplement as Annex B.
Pricing Options
Notes that bear interest will be fixed rate notes or floating rate notes,
or a combination of fixed rate and floating rate, as specified in the applicable
pricing supplement. The trusts may also issue discount notes, as specified in
the applicable pricing supplement.
Maturities
Each series of notes will mature on a day between nine months and 30 years
from its date of original issuance. Each series of notes will have the same
maturity date as the related funding agreement(s). The principal or any
installment of principal may mature prior to the stated maturity date if, for
example, there is a declaration of acceleration of maturity, a notice of
redemption at the option of the issuing trust or an election to exercise the
survivor's option.
Currency
The notes of each series will be denominated in, and payments of principal,
premium, if any, and/or interest, if any, and any other amounts in respect of
the notes will be made in, U.S. dollars.
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Form of Notes; Denominations
The issuing trust will issue each note of a series as a book-entry note
represented by one or more fully registered global securities, except as
contemplated under "--Book-Entry Notes." Unless otherwise specified in the
applicable pricing supplement, the minimum denominations of each note will be
$1,000 and integral multiples of $1,000 in excess thereof.
Listing of Notes
Unless otherwise specified in the applicable pricing supplement, a series
of notes will not be listed on any securities exchange.
Transfers and Exchanges
Book-entry notes may be transferred or exchanged only through DTC. See
"--Book-Entry Notes." No service charge will be imposed for any such
registration of transfer or exchange of notes, but the issuing trusts may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection therewith (other than certain exchanges
not involving any transfer).
Payments of Principal and Interest
The issuing trust will make payments of principal of, and premium, if any,
interest on, if any, and other amounts due and owing with respect to, book-entry
notes through the indenture trustee to DTC or its nominee. See "--Book-Entry
Notes." Payments of principal of, and premium on, if any, interest on, if any,
and other amounts due and owing with respect to, definitive notes will be made
at maturity in immediately available funds upon presentation and surrender of
the definitive note (and, in the case of the exercise of the survivor's option,
upon submission of a properly completed election form if required) at the office
or agency maintained by the issuing trust for this purpose in the Borough of
Manhattan, The City of New York. The issuing trust will make payments of
interest, if any, on and any other amounts due and owing with respect to, a
definitive note at maturity to the person to whom the issuing trust pays the
principal. The issuing trust will make any payments of interest on a definitive
note on an interest payment date other than the date of maturity by check mailed
to the address of the record date registered holder as it appears in the
security register. Notwithstanding the foregoing, the issuing trust will make
any payments of interest on an interest payment date other than the date of
maturity to each record date registered holder of $10,000,000 or more in
principal amount of definitive notes with the same interest payment date
(whether those notes otherwise have identical or different terms and provisions)
by wire transfer of immediately available funds if the registered holder has
delivered appropriate wire transfer instructions in writing to the indenture
trustee not less than 15 days prior to the relevant interest payment date. Any
wire transfer instructions received by the indenture trustee shall remain in
effect until revoked by the registered holder.
If any interest payment date or the maturity date of a note falls on a day
that is not a business day, the issuing trust will make the required payment on
the next business day and no additional interest will accrue for that period.
"Business day" means any day, other than a Saturday or Sunday, that is neither a
legal holiday nor a day on which commercial banks are authorized or required by
law, regulation or executive order to close in The City of New York.
Payments of Principal and Interest
Notes of a series may bear interest at a fixed interest rate ("fixed rate
notes") or at a floating interest rate ("floating rate notes").
Fixed Rate Notes
Each series of fixed rate notes will bear interest at a fixed rate from and
including its date of issue or from and including the most recent interest
payment date as to which interest has been paid or made available for payment
until the principal is paid or made available for payment. The applicable
pricing supplement will specify the fixed interest rate per annum applicable to
each note and the frequency with which interest is payable. Interest, including
interest for any partial period, will be computed on the basis of a 360-day year
of twelve 30-day months. Each payment of interest, including interest to be paid
at maturity, will include interest to, but excluding, the date that the interest
payment is due.
Interest on notes that bear interest at fixed rates will be payable in
arrears on each interest payment date to the registered holder at the close of
business on the record date except that interest, if any, due at maturity will
be paid to the
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person to whom the principal of the note is paid. Unless otherwise specified in
the applicable pricing supplement, the record date will be the day that is
fifteen calendar days preceding the applicable interest payment date, whether or
not a business day. Unless otherwise specified in the applicable pricing
supplement, the interest payment dates for fixed rate notes will be as follows:
Interest Payment Frequency Interest Payment Dates
-------------------------------------- -----------------------------------------------------
Monthly Fifteenth day of each calendar month, beginning in
the first calendar month following the date such
series of notes was issued.
Quarterly Fifteenth day of every third month, beginning in the
third calendar month following the date such
series of notes was issued.
Semiannual Fifteenth day of every sixth month, beginning in the
sixth calendar month following the date such
series of notes was issued.
Annual Fifteenth day of every twelfth month, beginning in
the twelfth calendar month following the date such
series of notes was issued.
Unless otherwise provided in the applicable pricing supplement, any
interest payment date or the maturity date of a series fixed rate notes falls on
a day that is not a business day, the issuing trust will make the required
payment of principal, premium, if any, and/or interest or other amounts on the
next succeeding business day, and no additional interest will accrue in respect
of the payment made on that next succeeding business day.
Interest rates that the issuing trust offers on the fixed rate notes may
differ depending upon, among other factors, the aggregate principal amount of
notes purchased in any single transaction. Notes with different variable terms,
other than interest rates, may also be offered concurrently by other trusts to
different investors. Other trusts may change interest rates or formulas and
other terms of notes from time to time, but no change of terms will affect any
note any other trust has previously issued or as to which any other trust has
accepted an offer to purchase.
Floating Rate Notes
Interest on each series of floating rate notes will be determined by
reference to the applicable interest rate basis or interest rate bases, which
may, as described below, include:
o the CD Rate,
o the CMT Rate,
o the Commercial Paper Rate,
o the Constant Maturity Swap Rate,
o the Federal Funds Open Rate,
o the Federal Funds Rate,
o LIBOR,
o the Prime Rate, or
o the Treasury Rate.
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The rate derived from the applicable interest rate basis will be determined
in accordance with the related provisions below. The interest rate in effect on
each day will be based on:
o if that day is an interest reset date, the rate determined as of the
interest determination date (as defined below) immediately preceding
that interest reset date; or
o if that day is not an interest reset date, the rate determined as of
the interest determination date immediately preceding the most recent
interest reset date.
The "spread" is the number of basis points (one one-hundredth of a
percentage point) specified in the applicable pricing supplement to be added to
or subtracted from the related interest rate basis or interest rate bases
applicable to a series of notes that bears interest at floating rates. The
"spread multiplier" is the percentage specified in the applicable pricing
supplement of the related interest rate basis or interest rate bases applicable
to a series of notes that bears interest at floating rates by which the interest
rate basis or interest rate bases will be multiplied to determine the applicable
interest rate. The "index maturity" is the period to maturity of the instrument
or obligation with respect to which the related interest rate basis or interest
rate bases will be calculated.
Regular Floating Rate Notes
Unless a series of floating rate notes is designated as a series of
Floating Rate/Fixed Rate, or as having an addendum attached or having
other/additional provisions apply, in each case relating to a different interest
rate formula, such series of notes that bears interest at floating rates will be
a series of Regular Floating Rate notes and will bear interest at the rate
determined by reference to the applicable interest rate basis or interest rate
bases:
o multiplied by the applicable spread multiplier, if any; and/or
o plus or minus the applicable spread, if any.
Commencing on the first interest reset date, as specified in the relevant
pricing supplement, the rate at which interest on a series of regular floating
rate notes is payable will be reset as of each interest reset date; provided,
however, that the interest rate in effect for the period, if any, from the date
of issue to the first interest reset date will be the initial interest rate.
Floating Rate/Fixed Rate Notes
If a series of notes that bears interest at floating rates is designated as
a series of Floating Rate/Fixed Rate notes, such series of notes that bears
interest at floating rates will bear interest at the rate determined by
reference to the applicable interest rate basis or interest rate bases:
o multiplied by the applicable spread multiplier, if any; and/or
o plus or minus the applicable spread, if any.
Commencing on the first interest reset date, the rate at which interest on
a series of Floating Rate/Fixed Rate notes is payable will be reset as of each
interest reset date; provided, however, that:
o the interest rate in effect for the period, if any, from the date of
issue to the first interest reset date will be the initial interest
rate, as specified in the relevant pricing supplement; and
o the interest rate in effect commencing on the fixed rate commencement
date will be the fixed interest rate, if specified in the applicable
pricing supplement, or, if not so specified, the interest rate in
effect on the day immediately preceding the fixed rate commencement
date.
Interest Reset Dates
The applicable pricing supplement will specify the dates on which the rate
of interest on a series of notes that bears interest at floating rates will be
reset (each, an "interest reset date"), and the period between interest reset
dates will be the "interest reset period." Unless otherwise specified in the
applicable pricing supplement, the interest reset dates will be, in the case of
a series of floating rate notes which reset:
S-24
o daily--each business day;
o weekly--the Wednesday of each week, with the exception of weekly reset
series of notes that bears interest at floating rates as to which the
Treasury Rate is an applicable interest rate basis, which will reset
the Tuesday of each week;
o monthly--the third Wednesday of each month;
o quarterly--the third Wednesday of every third calendar month,
beginning in the third calendar month following the month in which the
note was issued;
o semiannually--the third Wednesday of the two months specified in the
applicable pricing supplement; and
o annually--the third Wednesday of the month specified in the applicable
pricing supplement; provided, however, that, with respect to any
series of Floating Rate/Fixed Rate notes, the rate of interest thereon
will not reset after the particular fixed rate commencement date.
Unless otherwise provided in the applicable pricing supplement, if any
interest reset date for any series of notes that bears interest at floating
rates would otherwise be a day that is not a business day, the particular
interest reset date will be postponed to the next succeeding business day,
except that in the case of a series of notes that bears interest at floating
rates as to which LIBOR is an applicable interest rate basis and that business
day falls in the next succeeding calendar month, the particular interest reset
date will be the immediately preceding business day.
Interest Determination Dates
The interest rate applicable to a series of notes that bears interest at
floating rates for an interest reset period commencing on the related interest
reset date will be determined by reference to the applicable interest rate basis
as of the particular "interest determination date," which will be:
o with respect to the Federal Funds Open Rate--the related interest
reset date;
o with respect to the Federal Funds Rate and the Prime Rate--the
business day immediately preceding the related interest reset date;
o with respect to the CD Rate, the Commercial Paper Rate, and the CMT
Rate--the second business day preceding the related interest reset
date;
o with respect to the Constant Maturity Swap Rate--the second U.S.
Government Securities business day (as defined below) preceding the
related interest reset date; provided, however, that if, after
attempting to determine the Constant Maturity Swap Rate (as described
below), such rate is not determinable for a particular interest
determination date (the "original interest determination date"), then
such interest determination date shall be the first U.S. Government
Securities business day preceding the original interest determination
date for which the Constant Maturity Swap Rate can be determined as
described below;
o with respect to LIBOR--the second London banking day preceding the
related interest reset date; and
o with respect to the Treasury Rate--the day of the week in which the
related interest reset date falls on which day Treasury Bills (as
defined below) are normally auctioned (i.e., Treasury Bills are
normally sold at auction on Monday of each week, unless that day is a
legal holiday, in which case the auction is normally held on the
following Tuesday, except that the auction may be held on the
preceding Friday); provided, however, that if an auction is held on
the Friday of the week preceding the related interest reset date, the
interest determination date will be the preceding Friday.
Unless otherwise provided in the applicable pricing supplement, the
interest determination date pertaining to a series of floating rate notes that
bears interest at floating rates the interest rate of which is determined with
reference to two or more interest rate bases will be the latest business day
which is at least two business days before the related interest reset date for
the applicable note that bears interest at floating rates on which each interest
reset basis is determinable.
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Calculation Dates
The indenture trustee will be the "calculation agent" for a series of notes
unless otherwise specified in the applicable pricing supplement. The interest
rate applicable to each interest reset period will be determined by the
calculation agent on or prior to the calculation date (as defined below), except
with respect to LIBOR, which will be determined on the particular interest
determination date. Upon request of the registered holder of a series of
floating rate notes, the calculation agent will disclose the interest rate then
in effect and, if determined, the interest rate that will become effective as a
result of a determination made for the next succeeding interest reset date with
respect to the particular series of floating rate notes. The "calculation date,"
if applicable, pertaining to any interest determination date will be the earlier
of:
o the tenth calendar day after the particular interest determination
date or, if such day is not a business day, the next succeeding
business day; or
o the business day immediately preceding the applicable interest payment
date or the maturity date, as the case may be.
Maximum and Minimum Interest Rates
A series of notes that bears interest at floating rates may also have
either or both of the following if specified in the applicable pricing
supplement:
o a maximum numerical limitation, or ceiling, that may accrue during any
interest reset period (a "maximum interest rate"); and
o a minimum numerical limitation, or floor, that may accrue during any
interest reset period (a "minimum interest rate").
In addition to any maximum interest rate that may apply to a series of
floating rate notes, the interest rate on a series of floating rate notes will
in no event be higher than the maximum rate permitted by New York law, as the
same may be modified by United States law of general application.
Interest Payments
Unless otherwise specified in the applicable pricing supplement, interest
on each series of notes that bears interest at floating rates will be payable on
the date(s) as set forth below (each, an "interest payment date" with respect to
such series of notes that bears interest at floating rates). Unless otherwise
specified in the applicable pricing supplement, the record date will be the day
that is 15 calendar days preceding the applicable interest payment date, whether
or not a business day. Unless otherwise specified in the applicable pricing
supplement, the interest payment dates will be, in the case of a series of
floating rate notes which reset:
o daily, weekly or monthly--the third Wednesday of each month or on the
third Wednesday of every third calendar month, beginning in the third
calendar month following the date the applicable series of notes was
issued;
o quarterly--the third Wednesday of every third calendar month,
beginning in the third calendar month following the date the
applicable series of notes was issued;
o semiannually--the third Wednesday of the two months of each year
specified in the applicable pricing supplement; and
o annually--the third Wednesday of the month of each year specified in
the applicable pricing supplement.
In addition, the maturity date will also be an interest payment date.
Unless otherwise provided in the applicable pricing supplement, if any
interest payment date other than the maturity date for any series of floating
rate notes would otherwise be a day that is not a business day, such interest
payment date will be postponed to the next succeeding business day, except that
in the case of a series of floating rate notes as to which LIBOR is an
applicable interest rate basis and that business day falls in the next
succeeding calendar month, the particular interest
S-26
payment date will be the immediately preceding business day. If the maturity
date of a series of floating rate notes falls on a day that is not a business
day, the issuing trust will make the required payment of principal, premium, if
any, and interest or other amounts on the next succeeding business day, and no
additional interest will accrue in respect of the payment made on that next
succeeding business day.
All percentages resulting from any calculation on floating rates will be
rounded to the nearest one hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upwards. For example, 9.876545% (or
..09876545) would be rounded to 9.87655% (or .0987655). All dollar amounts used
in or resulting from any calculation on floating rates will be rounded to the
nearest cent.
With respect to each series of floating rate notes, accrued interest is
calculated by multiplying the principal amount of such series of floating rate
notes by an accrued interest factor. The accrued interest factor is computed by
adding the interest factor calculated for each day in the particular interest
period. The interest factor for each day will be computed by dividing the
interest rate applicable to such day by 360, in the case of a series of floating
rate notes as to which the CD Rate, the Commercial Paper Rate, the Federal Funds
Open Rate, the Federal Funds Rate, LIBOR or the Prime Rate is an applicable
interest rate basis, or by the actual number of days in the year, in the case of
a series of floating rate notes as to which the CMT Rate or the Treasury Rate is
an applicable interest rate basis. In the case of a series of notes that bears
interest at floating rates as to which the Constant Maturity Swap Rate is the
interest rate basis, the interest factor will be computed by dividing the number
of days in the interest period by 360 (the number of days to be calculated on
the basis of a year of 360 days with 12 30-day months (unless (i) the last day
of the interest period is the 31st day of a month but the first day of the
interest period is a day other than the 30th or 31st day of a month, in which
case the month that includes that last day shall not be considered to be
shortened to a 30-day month, or (ii) the last day of the interest period is the
last day of the month of February, in which case the month of February shall not
be considered to be lengthened to a 30-day month)). The interest factor for a
series of floating rate notes as to which the interest rate is calculated with
reference to two or more interest rate bases will be calculated in each period
in the same manner as if only the applicable interest rate basis specified in
the applicable pricing supplement applied.
The calculation agent shall determine the rate derived from each interest
rate basis in accordance with the following provisions.
CD Rate
"CD Rate" means:
(1) the rate on the particular interest determination date for negotiable
United States dollar certificates of deposit having the index maturity
specified in the applicable pricing supplement as published in
H.15(519) (as defined below) under the caption "CDs (secondary
market);" or
(2) if the rate referred to in clause (1) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate on
the particular interest determination date for negotiable United
States dollar certificates of deposit of the particular index maturity
as published in H.15 Daily Update (as defined below), or other
recognized electronic source used for the purpose of displaying the
applicable rate, under the caption "CDs (secondary market);" or
(3) if the rate referred to in clause (2) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate on
the particular interest determination date calculated by the
calculation agent as the arithmetic mean of the secondary market
offered rates as of 10:00 A.M., New York City time, on that interest
determination date, of three leading non-bank dealers in negotiable
United States dollar certificates of deposit in The City of New York
(which may include the Purchasing Agent or its affiliates) selected by
the calculation agent for negotiable United States dollar certificates
of deposit of major United States money market banks for negotiable
United States certificates of deposit with a remaining maturity
closest to the particular index maturity in an amount that is
representative for a single transaction in that market at that time;
or
(4) if the dealers so selected by the calculation agent are not quoting as
mentioned in clause (3), the CD Rate in effect on the particular
interest determination date; provided that if no CD Rate is then in
effect, the interest rate that will be effective as of the next
interest reset date will be the initial interest rate.
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"H.15(519)" means the weekly statistical release designated as H.15(519),
or any successor publication, published by the Board of Governors of the Federal
Reserve System.
"H.15 Daily Update" means the daily update of H.15(519), available through
the world-wide-web site of the Board of Governors of the Federal Reserve System
at http://www.federalreserve.gov/releases/H15/update, or any successor site or
publication.
CMT Rate
"CMT Rate" means:
(1) if CMT Moneyline Telerate Page 7051 is specified in the applicable
pricing supplement:
(a) the percentage equal to the yield for United States Treasury
securities at "constant maturity" having the index maturity
specified in the applicable pricing supplement as published in
H.15(519) under the caption "Treasury Constant Maturities," as
the yield is displayed on Moneyline Telerate (or any successor
service) on page 7051 (or any other page as may replace the
specified page on that service) ("Moneyline Telerate Page 7051"),
for the particular interest determination date; or
(b) if the rate referred to in clause (a) does not so appear on
Moneyline Telerate Page 7051, the percentage equal to the yield
for United States Treasury securities at "constant maturity"
having the particular index maturity and for the particular
interest determination date as published in H.15(519) under the
caption "Treasury Constant Maturities;" or
(c) if the rate referred to in clause (b) does not so appear in
H.15(519), the rate on the particular interest determination date
for the period of the particular index maturity as may then be
published by either the Federal Reserve System Board of Governors
or the United States Department of the Treasury that the
calculation agent determines to be comparable to the rate which
would otherwise have been published in H.15(519); or
(d) if the rate referred to in clause (c) is not so published, the
rate on the particular interest determination date calculated by
the calculation agent as a yield to maturity based on the
arithmetic mean of the secondary market bid prices at
approximately 3:30 P.M., New York City time, on that interest
determination date of three leading primary United States
government securities dealers in The City of New York (which may
include the Purchasing Agent or its affiliates) (each, a
"reference dealer"), selected by the calculation agent from five
reference dealers selected by the calculation agent and
eliminating the highest quotation, or, in the event of equality,
one of the highest and the lowest quotation or, in the event of
equality, one of the lowest, for United States Treasury
securities with an original maturity equal to the particular
index maturity, a remaining term to maturity no more than one
year shorter than that index maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at that time; or
(e) if fewer than five but more than two of the prices referred to in
clause (d) are provided as requested, the rate on the particular
interest determination date calculated by the calculation agent
based on the arithmetic mean of the bid prices obtained and
neither the highest nor the lowest of the quotations shall be
eliminated; or
(f) if fewer than three prices referred to in clause (d) are provided
as requested, the rate on the particular interest determination
date calculated by the calculation agent as a yield to maturity
based on the arithmetic mean of the secondary market bid prices
as of approximately 3:30 P.M., New York City time, on that
interest determination date of three reference dealers selected
by the calculation agent from five reference dealers selected by
the calculation agent and eliminating the highest quotation or,
in the event of equality, one of the highest and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity
greater than the particular index maturity, a remaining term to
maturity closest to that index maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at that time; or
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(g) if fewer than five but more than two prices referred to in clause
(f) are provided as requested, the rate on the particular
interest determination date calculated by the calculation agent
based on the arithmetic mean of the bid prices obtained and
neither the highest nor the lowest of the quotations will be
eliminated; or
(h) if fewer than three prices referred to in clause (f) are provided
as requested, the CMT Rate in effect on the particular interest
determination date; provided that if no CMT Rate is then in
effect, the interest rate that will be effective as of the next
interest reset date will be the initial interest rate.
(2) if CMT Moneyline Telerate Page 7052 is specified in the applicable
pricing supplement:
(a) the percentage equal to the one-week or one-month, as specified
in the applicable pricing supplement, average yield for United
States Treasury securities at "constant maturity" having the
index maturity specified in the applicable pricing supplement as
published in H.15(519) opposite the caption "Treasury Constant
Maturities," as the yield is displayed on Moneyline Telerate (or
any successor service) (on page 7052 or any other page as may
replace the specified page on that service) ("Moneyline Telerate
Page 7052"), for the week or month, as applicable, ended
immediately preceding the week or month, as applicable, in which
the particular interest determination date falls; or
(b) if the rate referred to in clause (a) does not so appear on
Moneyline Telerate Page 7052, the percentage equal to the
one-week or one-month, as specified in the applicable pricing
supplement, average yield for United States Treasury securities
at "constant maturity" having the particular index maturity and
for the week or month, as applicable, preceding the particular
interest determination date as published in H.15(519) opposite
the caption "Treasury Constant Maturities;" or
(c) if the rate referred to in clause (b) does not so appear in
H.15(519), the one-week or one-month, as specified in the
applicable pricing supplement, average yield for United States
Treasury securities at "constant maturity" having the particular
index maturity as otherwise announced by the Federal Reserve Bank
of New York for the week or month, as applicable, ended
immediately preceding the week or month, as applicable, in which
the particular interest determination date falls; or
(d) if the rate referred to in clause (c) is not so published, the
rate on the particular interest determination date calculated by
the calculation agent as a yield to maturity based on the
arithmetic mean of the secondary market bid prices at
approximately 3:30 P.M., New York City time, on that interest
determination date of three reference dealers selected by the
calculation agent from five reference dealers selected by the
calculation agent and eliminating the highest quotation, or, in
the event of equality, one of the highest and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity equal
to the particular index maturity, a remaining term to maturity no
more than one year shorter than that index maturity and in a
principal amount that is representative for a single transaction
in the securities in that market at that time; or
(e) if fewer than five but more than two of the prices referred to in
clause (d) are provided as requested, the rate on the particular
interest determination date calculated by the calculation agent
based on the arithmetic mean of the bid prices obtained and
neither the highest nor the lowest of the quotations shall be
eliminated; or
(f) if fewer than three prices referred to in clause (d) are provided
as requested, the rate on the particular interest determination
date calculated by the calculation agent as a yield to maturity
based on the arithmetic mean of the secondary market bid prices
as of approximately 3:30 P.M., New York City time, on that
interest determination date of three reference dealers selected
by the calculation agent from five reference dealers selected by
the calculation agent and eliminating the highest quotation or,
in the event of equality, one of the highest and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity
greater than the particular index maturity, a remaining term to
maturity closest to that index
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maturity and in a principal amount that is representative for a
single transaction in the securities in that market at the time;
or
(g) if fewer than five but more than two prices referred to in clause
(f) are provided as requested, the rate on the particular
interest determination date calculated by the calculation agent
based on the arithmetic mean of the bid prices obtained and
neither the highest nor the lowest of the quotations will be
eliminated; or
(h) if fewer than three prices referred to in clause (f) are provided
as requested, the CMT Rate in effect on that interest
determination date; provided that if no CMT Rate is then in
effect, the interest rate that will be effective as of the next
interest reset date will be the initial interest rate.
If two United States Treasury securities with an original maturity greater
than the index maturity specified in the applicable pricing supplement have
remaining terms to maturity equally close to the particular index maturity, the
quotes for the United States Treasury security with the shorter original
remaining term to maturity will be used.
Commercial Paper Rate
"Commercial Paper Rate" means:
(1) the Money Market Yield (as defined below) on the particular interest
determination date of the rate for commercial paper having the index
maturity specified in the applicable pricing supplement as published
in H.15(519) under the caption "Commercial Paper--Nonfinancial;" or
(2) if the rate referred to in clause (1) is not so published by 3:00
P.M., New York City time, on the related calculation date, the Money
Market Yield of the rate on the particular interest determination date
for commercial paper having the particular index maturity as published
in H.15 Daily Update, or such other recognized electronic source used
for the purpose of displaying the applicable rate, under the caption
"Commercial Paper--Nonfinancial;" or
(3) if the rate referred to in clause (2) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate on
the particular interest determination date calculated by the
calculation agent as the Money Market Yield of the arithmetic mean of
the offered rates at approximately 11:00 A.M., New York City time, on
that interest determination date of three leading dealers of United
States dollar commercial paper in The City of New York (which may
include the Purchasing Agent or its affiliates) selected by the
calculation agent for commercial paper having the particular index
maturity placed for industrial issuers whose bond rating is "Aa" by
Moody's or the equivalent from another nationally recognized
statistical rating organization; or
(4) if the dealers so selected by the calculation agent are not quoting as
mentioned in clause (3), the Commercial Paper Rate in effect on the
particular interest determination date; provided that if no Commercial
Paper Rate is then in effect, the interest rate that will be effective
as of the next interest reset date will be the initial interest rate.
"Money Market Yield" means a yield (expressed as a percentage) calculated
in accordance with the following formula:
Money Market Yield = D x 360 x 100
-------------------------------------
360 - (D x M)
where "D" refers to the applicable per annum rate for commercial paper quoted on
a bank discount basis and expressed as a decimal, and "M" refers to the actual
number of days in the applicable interest reset period.
Constant Maturity Swap Rate
"Constant Maturity Swap Rate" means:
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(1) the rate for U.S. Dollar swaps with the designated maturity specified
in the applicable pricing supplement, expressed as a percentage, which
appears on the Reuters Screen ISDAFIX1 Page as of 11:00 A.M., New York
City time, on the particular interest determination date; or
(2) if the rate referred to in clause (1) does not appear on the Reuters
Screen ISDAFIX1 Page by 2:00 P.M., New York City time, on such
interest determination date, a percentage determined on the basis of
the mid-market semi-annual swap rate quotations provided by the
reference banks (as defined below) as of approximately 11:00 A.M., New
York City time, on such interest determination date, and, for this
purpose, the semi-annual swap rate means the mean of the bid and
offered rates for the semi-annual fixed leg, calculated on a 30/360
day count basis, of a fixed-for-floating U.S. Dollar interest rate
swap transaction with a term equal to the designated maturity
specified in the applicable pricing supplement commencing on the
interest reset date and in a representative amount (as defined below)
with an acknowledged dealer of good credit in the swap market, where
the floating leg, calculated on an Actual/360 day count basis, is
equivalent to USD-LIBOR-BBA with a designated maturity specified in
the applicable pricing supplement. The calculation agent will request
the principal New York City office of each of the reference banks to
provide a quotation of its rate. If at least three quotations are
provided, the rate for that interest determination date will be the
arithmetic mean of the quotations, eliminating the highest quotation
(or, in the event of equality, one of the highest) and the lowest
quotation (or, in the event of equality, one of the lowest); or
(3) if such Constant Maturity Swap Rate is not determinable for a
particular interest determination date under clauses (1) and (2)
above, then such interest determination date shall be the first U.S.
Government Securities business day preceding the original interest
determination date for which the Constant Maturity Swap Rate can be
determined under clauses (1) and (2) above.
"U.S. Government Securities business day" means any day except for
Saturday, Sunday, or a day on which The Bond Market Association recommends that
the fixed income departments of its members be closed for the entire day for
purposes of trading in U.S. government securities.
"Representative amount" means an amount that is representative for a single
transaction in the relevant market at the relevant time.
"Reference banks" mean five leading swap dealers in the New York City
interbank market, selected by the calculation agent, after consultation with
Allstate Life.
Federal Funds Open Rate
"Federal Funds Open Rate" means the rate set forth on Moneyline Telerate
Page 5 for an interest reset date underneath the caption "FEDERAL FUNDS" in the
row titled "OPEN". If the rate is not available for an interest reset date, the
rate for that interest reset date shall be the Federal Funds Rate as determined
below.
Federal Funds Rate
"Federal Funds Rate" means:
(1) the rate as of the particular interest determination date for United
States dollar federal funds as published in H.15(519) under the
caption "Federal Funds (Effective)" and displayed on Moneyline
Telerate (or any successor service) on page 120 (or any other page as
may replace the specified page on that service) ("Moneyline Telerate
Page 120"); or
(2) if the rate referred to in clause (1) does not so appear on Moneyline
Telerate Page 120 or is not so published by 3:00 P.M., New York City
time, on the related calculation date, the rate as of the particular
interest determination date for United States dollar federal funds as
published in H.15 Daily Update, or such other recognized electronic
source used for the purpose of displaying the applicable rate, under
the caption "Federal Funds (Effective);" or
(3) if the rate referred to in clause (2) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate as
of the particular interest determination date calculated by the
calculation agent
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as the arithmetic mean of the rates for the last transaction in
overnight United States dollar federal funds arranged by three leading
brokers of United States dollar federal funds transactions in The City
of New York (which may include the Agents or their affiliates),
selected by the calculation agent prior to 9:00 A.M., New York City
time, on the business day following that interest determination date;
or
(4) if the brokers so selected by the calculation agent are not quoting as
mentioned in clause (3), the Federal Funds Rate in effect on the
particular interest determination date; provided that if no Federal
Funds Rate is then in effect, the interest rate that will be effective
as of the next interest reset date will be the initial interest rate.
LIBOR
"LIBOR" means:
(1) if "LIBOR Moneyline Telerate" is specified in the applicable pricing
supplement or if neither "LIBOR Reuters" nor "LIBOR Moneyline
Telerate" is specified in the applicable pricing supplement as the
method for calculating LIBOR, the rate for deposits in the LIBOR
currency having the index maturity specified in the applicable pricing
supplement, commencing on the related interest reset date, that
appears on the LIBOR page as of 11:00 A.M., London time, on the
particular interest determination date; or
(2) if "LIBOR Reuters" is specified in the applicable pricing supplement,
the arithmetic mean of the offered rates, calculated by the
calculation agent, or the offered rate, if the LIBOR page by its terms
provides only for a single rate, for deposits in the LIBOR currency
having the particular index maturity, commencing on the related
interest reset date, that appear or appears, as the case may be, on
the LIBOR page as of 11:00 A.M., London time, on the particular
interest determination date; or
(3) if fewer than two offered rates appear, or no rate appears, as the
case may be, on the particular interest determination date on the
LIBOR page as specified in clause (1) or (2), as applicable, the rate
calculated by the calculation agent of at least two offered quotations
obtained by the calculation agent after requesting the principal
London offices of each of four major reference banks (which may
include affiliates of the Purchasing Agent), in the London interbank
market to provide the calculation agent with its offered quotation for
deposits in the LIBOR currency for the period of the particular index
maturity, commencing on the related interest reset date, to prime
banks in the London interbank market at approximately 11:00 A.M.,
London time, on that interest determination date and in a principal
amount that is representative for a single transaction in the LIBOR
currency in that market at that time; or
(4) if fewer than two offered quotations referred to in clause (3) are
provided as requested, the rate calculated by the calculation agent as
the arithmetic mean of the rates quoted at approximately 11:00 A.M.,
in the applicable principal financial center, on the particular
interest determination date by three major banks (which may include
affiliates of the Purchasing Agent), in that principal financial
center selected by the calculation agent for loans in the LIBOR
currency to leading European banks, having the particular index
maturity and in a principal amount that is representative for a single
transaction in the LIBOR currency in that market at that time; or
(5) if the banks so selected by the calculation agent are not quoting as
mentioned in clause (4), LIBOR in effect on the particular interest
determination date; provided that if no LIBOR is then in effect, the
interest rate that will be effective as of the next interest reset
date will be the initial interest rate.
"LIBOR currency" means United States dollars.
"LIBOR page" means either:
(1) if "LIBOR Reuters" is specified in the applicable pricing supplement,
the display on the Reuter Monitor Money Rates Service (or any
successor service) on the page specified in the applicable pricing
supplement (or any other page as may replace that page on that
service) for the purpose of displaying the London interbank rates of
major banks for the LIBOR currency; or
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(2) if "LIBOR Moneyline Telerate" is specified in the applicable pricing
supplement or neither "LIBOR Reuters" nor "LIBOR Moneyline Telerate"
is specified in the applicable pricing supplement as the method for
calculating LIBOR, the display on Moneyline Telerate (or any successor
service) on the page specified in the applicable pricing supplement
(or any other page as may replace such page on such service) for the
purpose of displaying the London interbank rates of major banks for
the LIBOR currency.
"London banking day" means a day on which commercial banks are open for
business (including dealings in the LIBOR currency) in London.
Prime Rate
"Prime Rate" means:
(1) the rate on the particular interest determination date as published in
H.15(519) under the caption "Bank Prime Loan;" or
(2) if the rate referred to in clause (1) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate on
the particular interest determination date as published in H.15 Daily
Update, or such other recognized electronic source used for the
purpose of displaying the applicable rate, under the caption "Bank
Prime Loan;" or
(3) if the rate referred to in clause (2) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate on
the particular interest determination date calculated by the
calculation agent as the arithmetic mean of the rates of interest
publicly announced by each bank that appears on the Reuters Screen US
PRIME 1 Page (as defined below) as the applicable bank's prime rate or
base lending rate as of 11:00 A.M., New York City time, on that
interest determination date; or
(4) if fewer than four rates referred to in clause (3) are so published by
3:00 P.M., New York City time, on the related calculation date, the
rate calculated by the calculation agent as the particular interest
determination date calculated by the calculation agent as the
arithmetic mean of the prime rates or base lending rates quoted on the
basis of the actual number of days in the year divided by a 360-day
year as of the close of business on that interest determination date
by three major banks (which may include affiliates of the Purchasing
Agent) in The City of New York selected by the calculation agent; or
(5) if the banks so selected by the calculation agent are not quoting as
mentioned in clause (4), the Prime Rate in effect on the particular
interest determination date; provided that if no Prime Rate is then in
effect, the interest rate that will be effective as of the next
interest reset date will be the initial interest rate.
"Reuters Screen US PRIME 1 Page" means the display on the Reuter Monitor
Money Rates Service (or any successor service) on the "US PRIME 1" page (or any
other page as may replace that page on that service) for the purpose of
displaying prime rates or base lending rates of major United States banks.
Treasury Rate
"Treasury Rate" means:
(1) the rate from the auction held on the Treasury Rate interest
determination date (the "Auction") of direct obligations of the United
States ("Treasury Bills") having the index maturity specified in the
applicable pricing supplement under the caption "INVESTMENT RATE" on
the display on Moneyline Telerate (or any successor service) on page
56 (or any other page as may replace that page on that service)
("Moneyline Telerate Page 56") or page 57 (or any other page as may
replace that page on that service) ("Moneyline Telerate Page 57"); or
(2) if the rate referred to in clause (1) is not so published by 3:00
P.M., New York City time, on the related calculation date, the Bond
Equivalent Yield (as defined below) of the rate for the applicable
Treasury Bills as published in H.15 Daily Update, or another
recognized electronic source used for the purpose of displaying the
applicable rate, under the caption "U.S. Government
Securities/Treasury Bills/Auction High;" or
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(3) if the rate referred to in clause (2) is not so published by 3:00
P.M., New York City time, on the related calculation date, the Bond
Equivalent Yield of the auction rate of the applicable Treasury Bills
as announced by the United States Department of the Treasury; or
(4) if the rate referred to in clause (3) is not so announced by the
United States Department of the Treasury, or if the Auction is not
held, the Bond Equivalent Yield of the rate on the particular interest
determination date of the applicable Treasury Bills as published in
H.15(519) under the caption "U.S. Government Securities/Treasury
Bills/Secondary Market;" or
(5) if the rate referred to in clause (4) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate on
the particular interest determination date of the applicable Treasury
Bills as published in H.15 Daily Update, or another recognized
electronic source used for the purpose of displaying the applicable
rate, under the caption "U.S. Government Securities/Treasury
Bills/Secondary Market;" or
(6) if the rate referred to in clause (5) is not so published by 3:00
P.M., New York City time, on the related calculation date, the rate on
the particular interest determination date calculated by the
calculation agent as the Bond Equivalent Yield of the arithmetic mean
of the secondary market bid rates, as of approximately 3:30 P.M., New
York City time, on that interest determination date, of three primary
United States government securities dealers (which may include the
Purchasing Agent or its affiliates) selected by the calculation agent,
for the issue of Treasury Bills with a remaining maturity closest to
the index maturity specified in the applicable pricing supplement; or
(7) if the dealers so selected by the calculation agent are not quoting as
mentioned in clause (6), the Treasury Rate in effect on the particular
interest determination date; provided that if no Treasury Rate is then
in effect, the interest rate that will be effective as of the next
interest reset date will be the initial interest rate.
"Bond Equivalent Yield" means a yield (expressed as a percentage)
calculated in accordance with the following formula:
Bond Equivalent Yield = D x N x 100
-------------------------------------
360 - (D x M)
where "D" refers to the applicable per annum rate for Treasury Bills quoted on a
bank discount basis and expressed as a decimal, "N" refers to 365 or 366, as the
case may be, and "M" refers to the actual number of days in the applicable
interest reset period.
Discount Notes
The trusts may from time to time issue series of notes ("discount notes")
that have an issue price (as specified in the applicable pricing supplement)
that is less than 100% of the principal amount thereof (i.e. par) by more than a
percentage equal to the product of 0.25% and the number of full years to the
stated maturity date. A series of discount notes may not bear any interest
currently or may bear interest at a rate that is below market rates at the time
of issuance. The difference between the issue price of a series of discount
notes and par is referred to as the "discount." In the event of redemption,
repayment or acceleration of maturity of a series of discount notes, the amount
payable to the holders of such series of discount notes will be equal to the sum
of:
o the issue price (increased by any accruals of discount) and, in the
event of any redemption of such series of discount notes, if
applicable, multiplied by the initial redemption percentage (as
adjusted by the annual redemption percentage reduction, if
applicable); and
o any unpaid interest accrued on such series of discount notes to the
date of the redemption, repayment or acceleration of maturity, as the
case may be.
For purposes of determining the amount of discount that has accrued as of
any date on which a redemption, repayment or acceleration of maturity occurs for
a series of discount notes, a discount will be accrued using a constant yield
method. The constant yield will be calculated using a 30-day month, 360-day year
convention, a compounding period that, except for the initial period (as defined
below), corresponds to the shortest period between interest payment dates for
the applicable series of discount notes (with ratable accruals within a
compounding period), a coupon rate equal to the initial
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coupon rate applicable to the applicable series of discount notes and an
assumption that the maturity of such series of discount notes will not be
accelerated. If the period from the date of issue to the first interest payment
date for a series of discount notes (the "initial period") is shorter than the
compounding period for such series of discount notes, a proportionate amount of
the yield for an entire compounding period will be accrued. If the initial
period is longer than the compounding period, then the period will be divided
into a regular compounding period and a short period with the short period being
treated as provided in the preceding sentence. The accrual of the applicable
discount may differ from the accrual of original issue discount for purposes of
the Code, certain series of discount notes may not be treated as having original
issue discount within the meaning of the Code, and certain series of notes other
than discount notes may be treated as issued with original issue discount for
federal income tax purposes. See "United States Federal Income Tax
Considerations."
Withholding Tax; No Payment of Additional Amounts
All amounts due in respect of the notes of a series will be made without
withholding or deduction for or on account of any present or future taxes,
duties, levies, assessments or other governmental charges of whatever nature
imposed or levied by or on behalf of any governmental authority in the United
States having the power to tax on payments on the notes unless the withholding
or deduction is required by law. An issuing trust will not pay any additional
amounts to holders of any series of notes in the event that any withholding or
deduction is so required by law, regulation or official interpretation thereof,
and the imposition of a requirement to make any such withholding or deduction
will not give rise to any independent right or obligation to redeem the notes of
such series.
Security; Non-Recourse Obligations
The notes of a series will represent the obligations of the issuing trust
only, and will not be guaranteed by any person or entity. The obligations under
each series of notes will be secured by all of the rights and title of the
issuing trust in one or more funding agreements issued by Allstate Life and
other rights and assets included in the applicable collateral held in the
issuing trust.
The issuing trust will, from time to time and upon advice of counsel, at
the trust's expense, execute, deliver, file and record any statement,
assignment, instrument, document, agreement or other paper and take any other
action, (including, without limitation, any filings of financing or continuation
statements) that from time to time may be necessary or desirable, or that the
indenture trustee may reasonably request, in order to create, preserve, perfect,
confirm or validate a security interest or to enable the holder of its series of
notes to obtain the full benefits of the applicable indenture, or to enable the
indenture trustee to exercise and enforce any of its rights, powers and remedies
under the indenture with respect to the applicable collateral. To the extent
permitted by applicable law, the issuing trust authorizes the indenture trustee
to execute and file financing statements or continuation statements without the
trust's signature appearing thereon and will agree that a carbon, photographic,
photostatic or other reproduction of the applicable indenture or of a financing
statement is sufficient as a financing statement. The issuing trust shall pay
the costs of, or incidental to, any recording or filing of any financing or
continuation statements concerning any of the applicable collateral.
Since Allstate Life will be the sole obligor under the funding agreements,
the ability of a trust to meet its obligations, and your ability to receive
payments from such trust, with respect to a particular series of notes, will be
principally dependent upon Allstate Life's ability to perform its obligations
under each applicable funding agreement held by the issuing trust. Despite this,
you will have no direct contractual rights against Allstate Life under any such
funding agreement. Pursuant to the terms of each funding agreement, recourse
rights to Allstate Life will belong to the issuing trust, its successors and
permitted assignees. In connection with the offering and sale of a series of
notes, the issuing trust will pledge, collaterally assign and grant a security
interest in the collateral for such series of notes to the indenture trustee for
the benefit of the holders of the applicable series of notes and any other
person for whose benefit the indenture trustee is or will be holding the
collateral. Accordingly, recourse to Allstate Life under each such funding
agreement will be enforceable only by the indenture trustee as a secured party
for the benefit of holders of such series of notes and any other person for
whose benefit the indenture trustee is or will be holding the collateral.
Nonetheless, since Allstate Life is a registrant, purchasers of notes may
be able to proceed directly against Allstate Life to enforce their rights under
the Federal securities laws and their rights under the Federal securities laws
will be no different than if they purchased the underlying funding agreements
directly from Allstate Life.
Survivor's Option
The "survivor's option" is a provision in a note pursuant to which the
issuing trust agrees to repay that note in whole or in part prior to maturity,
if requested, following the death of the beneficial owner of the note, so long
as the note was held
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by the beneficial owner for a period of at least six months prior to the death
of the beneficial owner. Unless otherwise specified in the applicable pricing
supplement, the estate of the deceased beneficial owner of a note will be
eligible to exercise the survivor's option.
Subject to the limitations described below, upon the valid exercise of the
survivor's option, the proper tender of that note for repayment and the tender
and acceptance of that portion of the funding agreement(s) related to such note,
the issuing trust will repay any of its notes pursuant to the survivor's option
by or on behalf of a person that has the legal authority to act on behalf of the
note's deceased owner. Unless otherwise specified in the applicable pricing
supplement, the repurchase price will be 100% of the unpaid principal amount
plus accrued interest to, but excluding, the date of repayment.
Unless otherwise set forth in the applicable pricing supplement for your
series of notes, the funding agreement(s) securing your series of notes will
contain a provision which will allow the issuing trust to tender the funding
agreement(s) in whole or in part to Allstate Life. An issuing trust's ability to
tender the funding agreement(s) related to a series of notes that contain a
survivor's option will be subject to certain limitations set by Allstate Life.
As a result, your right to exercise the survivor's option is subject to limits
set by Allstate Life with respect to the relevant funding agreement(s). Allstate
Life has the discretionary right to limit the aggregate principal amount of:
o all funding agreements securing all outstanding series of notes issued
under the Allstate Life(R) CoreNotes(R) program as to which exercises
of any put option by any issuing trust shall be accepted by Allstate
Life in any calendar year to an amount equal to the greater of
$2,000,000 or 2% of the aggregate principal amount of all funding
agreements securing all outstanding series of notes issued under the
Allstate Life(R) CoreNotes(R) program as of the end of the most recent
calendar year or such other greater amount as determined in accordance
with the applicable funding agreement(s) and set forth in the
applicable pricing supplement;
o the funding agreement(s) securing the notes as to which exercises of
any put option by the applicable trust attributable to notes as to
which the survivor's option has been exercised by the authorized
representative of any individual deceased beneficial owner to $250,000
in any calendar year or such other greater amount as determined in
accordance with the applicable funding agreement(s) and set forth in
the applicable pricing supplement; and
o the funding agreement(s) securing a series of notes as to which
exercises of any put option by the applicable trust shall be accepted
in any calendar year to an amount as set forth in the applicable
funding agreement(s) and the applicable pricing supplement.
In any such event, each trust shall similarly be required to limit the
aggregate principal amount of notes as to which exercises of the survivor's
option shall be accepted by it.
In addition, the exercise of the survivor's option will not be permitted
for a principal amount less than $1,000 or if such exercise will result in a
note with a principal amount of less than $1,000 to remain outstanding. All
other questions, other than with respect to the right to limit the aggregate
principal amount of notes subject to the survivor's option that will be accepted
as to any series of notes or in any calendar year, regarding the eligibility or
validity of any exercise of the survivor's option will be determined by the
administrator of the issuing trust, in its sole discretion, which determination
will be final and binding on all parties. The indenture trustee, upon written
request by the authorized representative of the deceased beneficial owner of
notes, will request the administrator to provide the status of the remaining
program and series limitations for such calendar year on the exercise of any
survivor's option.
The issuing trust will accept elections to exercise the survivor's option
in the order received by the administrator of the issuing trust. Notes that are
not repaid in any calendar year due to the application of the limits described
above will be treated as though they had been tendered on the first day of the
following calendar year in the order in which they were originally tendered.
Subject to the limitations described above, notes accepted for repayment will be
repaid on the first interest payment date that occurs 20 or more calendar days
after the date of acceptance.
If repayment of a note submitted for repayment pursuant to a valid exercise
of the survivor's option is not accepted or is to be delayed, the administrator
of the issuing trust will deliver a written notice by first-class mail to the
depositary that states the reason that repayment of that particular note has not
been accepted or will be delayed.
A valid exercise of the survivor's option may not be withdrawn.
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To exercise the survivor's option with respect to a book-entry note, the
deceased owner's authorized person must provide the following items to the DTC
"participant" through which the relevant beneficial interest is owned (for a
discussion of DTC and its participants, see "--About the Depositary"):
o a written instruction to the participant to notify DTC of the
authorized person's desire to obtain a payment pursuant to the
exercise of the survivor's option;
o appropriate evidence (a) that the person has authority to act on
behalf of the deceased owner, (b) of the death of the beneficial
owner, (c) that the deceased was the beneficial owner of the notes at
the time of death and (d) that the beneficial owner acquired the
interest in the note at least six months prior to the date of death of
such beneficial owner;
o if the beneficial interest in the relevant note is held by a nominee
of the deceased owner, a certificate from the nominee attesting to the
deceased owner's ownership of a beneficial interest in that note;
o a written request for repayment signed by the authorized person for
the deceased owner with signature guaranteed by a member firm of a
registered national securities exchange or of the National Association
of Securities Dealers, Inc. or a commercial bank or trust company
having an office or correspondent in the United States;
o if applicable, a properly executed assignment or endorsement;
o tax waivers and any other instruments or documents reasonably required
to establish the validity of the ownership of the beneficial interest
in the related note and the claimant's entitlement to payment; and
o any additional information reasonably required to document the
ownership or authority to exercise the survivor's option and to cause
the repayment of the related note.
In turn, on the basis of this information, the participant will be required
to deliver to the indenture trustee a properly completed repayment election form
to exercise the survivor's option, together with evidence satisfactory to the
indenture trustee from the participant stating that it represents the deceased
owner of the beneficial interest in the relevant note. The indenture trustee
will then deliver these items to the administrator of the issuing trust and will
provide the administrator of the issuing trust with any additional information
(after receipt from the participant) the administrator may request in connection
with such exercise.
Apart from Allstate Life's discretionary right to limit the principal
amount of funding agreements securing notes as to which exercises of any put
option by the issuing trusts attributable to notes to which the survivor's
option may be exercised in any calendar year as described above, the
administrator will determine all other questions regarding the eligibility or
validity of any exercise of the survivor's option. The administrator's
determination will be final and binding on all parties.
The death of a person owning a note in joint tenancy or tenancy by the
entirety with another or others will be treated as the death of the owner of
that note, and the entire principal amount so owned will be eligible for
repayment.
The death of a person owning a note by tenancy in common will be treated as
the death of the owner of that note only with respect to the deceased owner's
interest in the note held by tenancy in common. However, if a note is held by
husband and wife as tenants in common, the death of either spouse will be
treated as the death of the owner of the note and the entire principal amount so
owned will be eligible for repayment.
The death of a person who was a lifetime beneficiary of a trust that owns a
note will be treated as the death of the owner of the note to the extent of that
person's interest in the trust. The death of a person who was a tenant by the
entirety or joint tenant in a tenancy which is the beneficiary of a trust that
owns a note will be treated as the death of the owner of the note. The death of
an individual who was a tenant in common in a tenancy which is the beneficiary
of a trust that owns a note will be treated as the death of the owner of the
note only with respect to the deceased person's beneficial interest in the note,
unless a husband and wife are the tenants in common, in which case the death of
either will be treated as the death of the owner of the note.
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The death of a person who, during his or her lifetime, was entitled to
substantially all of the beneficial interests of ownership of a note will be
treated as the death of the owner of the note if the beneficial interest can be
established to the administrator's satisfaction. This will be done in typical
cases of nominee ownership, such as ownership under the Uniform Transfers of
Gifts to Minors Act, community property or other joint ownership arrangements
between a husband and wife and lifetime custodial and trust arrangements.
The applicable participant will be responsible for disbursing payments
received from the indenture trustee to the authorized person for the deceased
owner.
Annex A to this prospectus supplement is the repayment election form for
use by DTC participants in exercising the survivor's option. Copies of this form
may be obtained from the administrator at AMACAR Pacific Corp., 6525 Morrison
Blvd., Suite 318, Charlotte, NC 28211 (telephone (704) 365-0569, facsimile (704)
365-1632).
Redemption, Repayment and Repurchase of Notes
Unless otherwise specified in the applicable pricing supplement, the notes
of a series will not be redeemable, except at the applicable maturity date, when
all notes of such series will be redeemed.
Optional Redemption by the Issuer; No Sinking Fund
If an initial redemption date is specified in the applicable pricing
supplement and provided for in the applicable funding agreement(s), the issuing
trust may redeem the particular series of notes prior to its stated maturity
date at its option on any date on or after that initial redemption date in whole
or from time to time in part in increments of $1,000 or any other integral
multiple of an authorized denomination specified in the applicable pricing
supplement (provided that any remaining principal amount thereof shall be at
least $1,000 or other minimum authorized denomination applicable thereto), at
the applicable redemption price (as defined below), together with unpaid
interest accrued thereon to the date of redemption. "Redemption price," with
respect to a series of notes, means an amount equal to the initial redemption
percentage specified in the applicable pricing supplement (as adjusted by the
annual redemption percentage reduction, if applicable) multiplied by the unpaid
principal amount thereof to be redeemed. The initial redemption percentage, if
any, applicable to a series of notes shall decline at each anniversary of the
initial redemption date by an amount equal to the applicable annual redemption
percentage reduction, if any, until the redemption price is equal to 100% of the
unpaid amount thereof to be redeemed. For a discussion of the redemption of
discount notes, see "--Discount Notes."
No series of notes will be subject to, or entitled to the benefit of, any
sinking fund unless otherwise indicated in the applicable pricing supplement.
The applicable pricing supplement may provide that the notes of a series
may be redeemed by the issuing trust and the terms of such redemption. If so
specified, the issuing trust will give a notice of redemption to each holder of
the notes to be redeemed not less than 30 days nor more than 60 days prior to
the date fixed for redemption.
Each trust may issue a series of notes which may be redeemed by the issuing
trust when 25% or more of the original principal balance of such notes is
outstanding, which are referred to herein as "callable" notes. If a trust issues
a series of callable notes, such trust will include the word "callable" in the
title of such series of notes in the applicable pricing supplement. Unless
otherwise specified in the applicable pricing supplement, such series of notes
will otherwise be subject to the redemption provisions described above.
Repayment at Option of Holder
Except for the survivor's option, the notes of a series will not provide
any holder with the option to have the issuing trust repay the note on a date or
dates specified prior to its maturity date. If the applicable pricing supplement
specifies that a particular series of notes will have a survivor's option, the
relevant funding agreement will provide for such pre-payment of amounts due
under the notes.
None of the trusts will issue notes that may be repaid at the option of the
holders prior to the stated maturity date if such issuance would cause the
relevant trust to fail to satisfy the applicable requirements for exemption
under Rule 3a-7 under the Investment Company Act of 1940, as amended, and all
applicable rules, regulations and interpretations thereunder.
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Repurchase of Notes
Each trust may purchase some or all notes of a series issued by such trust
in the open market or otherwise at any time, and from time to time, with the
prior written consent of Allstate Life as to both the making of such purchase
and the purchase price to be paid for such notes. If Allstate Life, in its sole
discretion, consents to such purchase of notes by the issuing trust, then such
trust, the indenture trustee and Allstate Life will be obligated to take such
actions as may be necessary or desirable to effect the prepayment of such
portion, or the entirety, of the current Principal Amount (as defined in the
applicable funding agreement) under each applicable funding agreement as may be
necessary to provide for the payment of the purchase price for such notes. Upon
such payment, the Principal Amount under each funding agreement shall be reduced
by an amount equal to the aggregate principal amount of the notes as purchased
(or the portion thereof applicable to such funding agreement).
Other/Additional Provisions; Addendum
Any provisions with respect to the notes of a series, including the
specification and determination of one or more interest rate bases, the
calculation of the interest rate applicable to a series of notes that bears
interest at floating rates, the interest payment dates, the stated maturity
date, any redemption or repayment provisions or any other term relating to the
applicable series of notes, may be modified and/or supplemented as specified
under "Other/Additional Provisions" on the face thereof or in an addendum
relating thereto, if so specified on the face thereof and, in each case,
described in the applicable pricing supplement.
Book-Entry Notes
Each trust will establish a depositary arrangement with the DTC with
respect to the book-entry notes, the terms of which are summarized below.
All book-entry notes having the same terms will be represented by one or
more global securities. Each global security will be deposited with, or on
behalf of, DTC and will be registered in the name of DTC or its nominee. No
global security may be transferred or exchanged except by DTC or a nominee of
DTC to DTC or to another nominee of DTC, or by DTC or another nominee of DTC to
a successor of DTC or a nominee of a successor to DTC. So long as DTC or its
nominee is the registered holder of a global security, DTC or its nominee will
be the sole owner of the related book-entry notes for all purposes under the
indenture. Except as otherwise provided below, the beneficial owners of the
book-entry notes will not be entitled to receive definitive notes and will not
be considered the registered holders of the book-entry notes for any purpose
under the indenture and no global security representing book-entry notes will be
exchangeable or transferable. As a result, to exercise any rights of a
registered holder under the indenture a beneficial owner must rely on the
procedures of DTC and, if the beneficial owner is not a participant, on the
procedures of the participant or participants through which the beneficial owner
owns its interest. The laws of some jurisdictions require that some purchasers
of securities take physical delivery of securities in definitive form. These
laws may limit the ability to transfer beneficial interests in book-entry notes.
Each global security representing book-entry notes will be exchangeable for
definitive notes only if:
o subject to the procedures of DTC, the issuing trust notifies the
indenture trustee that the issuing trust wishes in its sole discretion
to exchange the global security for definitive notes;
o an event of default on the notes of that series has occurred and not
been cured; or
o DTC notifies the issuing trust that it is unwilling or unable to
continue as a clearing system for the global securities, or it ceases
to be a clearing agency registered under the Exchange Act and, in
either case, a successor clearing system is not appointed by the
issuing trust within 60 days after receiving the notice from DTC or
becoming aware that DTC is no longer registered.
If any of these events occurs, the issuing trust will print and deliver
definitive notes. Definitive notes issued under these circumstances will be
registered in the names of the beneficial owners of the related global
securities as provided to the indenture trustee by the participants identified
by DTC.
About the Depositary
The following is based on information furnished by DTC:
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DTC will act as securities depository for the book-entry notes. The
book-entry notes will be issued as fully registered securities in the name of
Cede & Co. (DTC's nominee) or another name requested by DTC. One fully
registered global security will be issued for each issue of book-entry notes in
the aggregate principal amount of that issue and will be deposited with, or on
behalf of, DTC. If the aggregate principal amount of any issue exceeds DTC's
limit for a single global security, then the global securities will be issued in
the form of one or more global securities having a principal amount equal to
DTC's limit and an additional global security representing any remaining
principal amount.
DTC is a limited-purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Exchange Act. DTC
holds securities that its direct participants deposit with it. DTC also
facilitates the settlement among direct participants of transactions in
deposited securities, such as transfers and pledges, through electronic
computerized book-entry changes in direct participants' accounts. This
eliminates the need for physical movement of securities certificates. DTC's
direct participants include securities brokers and dealers (including the
Purchasing Agent), banks, trust companies, clearing corporations and other
organizations. DTC is owned by a number of its direct participants and by the
New York Stock Exchange, Inc., the American Stock Exchange LLC and NASD. Access
to DTC's system is also available to others such as securities brokers and
dealers, banks and trust companies that clear through or maintain a custodial
relationship with a direct participant, either directly or indirectly. The rules
applicable to DTC and its direct and indirect participants are on file with the
SEC.
Under DTC's system, purchases of book-entry notes must be made by or
through direct participants, which will receive a credit for the book-entry
notes on DTC's records. The ownership interest of the actual purchaser is in
turn recorded on the records of the direct and indirect participants. Beneficial
owners will not receive written confirmation from DTC of their purchase, but are
expected to receive written confirmations providing details of the transaction,
as well as periodic statements of their holdings, from the direct or indirect
participants through which they entered into the transaction. Transfers of
ownership interests in book-entry notes are accomplished by entries made on the
books of the direct and indirect participants acting on behalf of the beneficial
owners. Beneficial owners will not receive definitive notes unless use of the
book-entry system is discontinued as described above.
To facilitate subsequent transfers, all global securities representing the
book-entry notes deposited with, or on behalf of, DTC will be registered in the
name of DTC's nominee, Cede & Co., or any other name that DTC requests. The
deposit of global securities with, or on behalf of, DTC and their registration
in the name of Cede & Co. effect no change in beneficial ownership. DTC has no
knowledge of the actual beneficial owners of the book-entry notes; DTC's records
reflect only the identity of the direct participants to whose accounts the
book-entry notes are credited, which may or may not be the beneficial owners.
DTC's participants are responsible for keeping account of their holdings on
behalf of their customers.
Conveyance of notices and other communications from DTC to direct
participants, from direct participants to indirect participants and from direct
participants and indirect participants to beneficial owners are governed by
arrangements among them and are subject to statutory and regulatory
requirements.
Neither DTC nor Cede & Co. will consent or vote with respect to global
securities. Under its usual procedures, DTC mails an omnibus proxy to a company
as soon as possible after a record date. The omnibus proxy assigns Cede & Co.'s
consenting or voting rights to those direct participants to whose accounts the
book-entry notes are credited on the record date (identified in a listing
attached to the omnibus proxy).
The issuing trust will make payments on the global securities in
immediately available funds to Cede & Co. or any other nominee named by DTC.
DTC's practice is to credit direct participants' accounts on the applicable
payment date in accordance with their respective holdings shown on DTC's records
unless DTC has reason to believe that it will not receive payment on that date.
Payments by participants to beneficial owners are governed by standing
instructions and customary practices and are subject to statutory and regulatory
requirements. The issuing trust and the trustee are responsible only for making
payments to DTC, DTC is responsible for disbursing those payments to its direct
participants and the direct participants (and any indirect participants) are
solely responsible for disbursing those payments to the beneficial owners.
Any redemption notices will be sent to Cede & Co. If less than all of the
book-entry notes having the same terms are being redeemed, DTC's current
practice is to determine by lot the amount of the interest of each direct
participant in those notes to be redeemed.
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A beneficial owner must give notice of any election to have its book-entry
notes repaid through its participant to the trustee. Delivery of the book-entry
notes will be effected by causing the relevant direct participant to transfer
the relevant part of its interest in the global securities to the trustee on
DTC's records.
DTC may discontinue providing its services as securities depository with
respect to a series of notes at any time by giving reasonable notice to the
issuing trust or the indenture trustee. If the issuing trust does not obtain a
successor securities depository, it will print and deliver definitive notes of
such series.
The issuing trust may decide to discontinue use of the system of book-entry
transfers through DTC (or a successor securities depository). If the issuing
trust does so, it will print and deliver definitive notes.
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DESCRIPTION OF THE FUNDING AGREEMENTS
Each trust will use the net proceeds from the issuance of its series of
notes to the public to purchase from Global Funding one or more funding
agreements issued by Allstate Life. The funding agreement(s) will have a
principal amount equal to the principal amount of the related series of notes.
The funding agreement(s) will otherwise have payment and other terms
substantially similar to the related series of notes. The funding agreement(s)
may be interest bearing or non-interest bearing and, if interest bearing, may
bear interest at fixed or floating rates. The calculation of the interest rate,
the due dates for payments and other payment terms on the funding agreement will
be determined in the manner substantially similar to that described above under
"Description of the Notes." An amount equal to the principal amount of the
funding agreement plus accrued but unpaid interest, if any, and accrued
discount, if any (in the case of a discount funding agreement) will be payable
on its maturity date, as specified in the applicable pricing supplement.
The funding agreement(s) will have a principal amount equal to the
principal amount of the related series of notes. The funding agreement(s) will
otherwise have payment and other terms substantially similar to the related
series of notes. For a more detailed discussion of the funding agreements, see
"Description of the Funding Agreement" in the accompanying prospectus.
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UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
This section provides a discussion of the material United States Federal
income tax consequences of the purchase, ownership and disposition of the notes.
This summary is based upon laws, regulations, rulings and decisions now in
effect, all of which are subject to change (including changes in effective
dates) or possible differing interpretations. This summary deals only with notes
held as capital assets and does not purport to deal with persons in special tax
situations, such as financial institutions, partnerships, insurance companies,
regulated investment companies, dealers in securities or currencies, persons
holding notes as a hedge against currency risks or as a position in a "straddle"
for tax purposes, or persons whose functional currency is not the United States
dollar. It also does not deal with holders other than initial purchasers of
notes (except where otherwise specifically noted). Persons considering the
purchase of the notes should consult their own tax advisors concerning the
application of United States Federal income tax laws to their particular
situations as well as any consequences of the purchase, ownership and
disposition of the notes arising under the laws of any other taxing
jurisdiction. This summary does not consider the United States Federal income
tax consequences of the purchase, ownership or disposition of a note by a
partnership. If a partnership holds a note, the tax treatment of a partner will
generally depend upon the status of the partner and the activities of the
partnership. Partnerships holding a note, and partners in a partnership holding
a note, should consult their tax advisors.
As used herein, the term "U.S. Holder" means a beneficial owner of a note
that is for United States Federal income tax purposes:
o a citizen or resident of the United States;
o a corporation (including an entity treated as a corporation for United
States Federal income tax purposes) created or organized in or under
the laws of the United States, any state thereof or the District of
Columbia;
o an estate whose income is subject to United States Federal income tax
regardless of its source; or
o subject to applicable transition rules, a trust if a court within the
United States is able to exercise primary supervision over the
administration of the trust and one or more United States persons have
the authority to control all substantial decisions of the trust.
As used in this section, the term "non-U.S. Holder" means a beneficial
owner of a note that is an individual, a corporation, an estate or trust that is
not a U.S. Holder.
Classification of the Issuer and Notes
In the opinion of LeBoeuf, Lamb, Greene & MacRae LLP, special tax counsel
to Global Funding, under current law and based on certain facts and assumptions
contained in such opinion:
o Global Funding and each trust will be ignored for United States
Federal income tax purposes and will not be treated as an association
or a publicly traded partnership taxable as a corporation; and
o the notes will be classified as indebtedness of Allstate Life for
United States Federal income tax purposes.
Allstate Life, Global Funding and each trust agree, and each holder and
beneficial owner of notes by purchasing the notes agrees, for all United States
Federal, state and local income and franchise tax purposes (i) to treat the
notes as indebtedness of Allstate Life, (ii) Global Funding and each trust will
be ignored and will not be treated as an association or a publicly traded
partnership taxable as a corporation and (iii) to not take any action
inconsistent with the treatment described in (i) and (ii) unless otherwise
required by law. The remainder of this discussion assumes the notes are properly
treated as indebtedness of Allstate Life for all United States Federal income
tax purposes.
An opinion of tax counsel is not binding on the Internal Revenue Service
(the "IRS") or the courts, and no ruling on any of the consequences or issues
discussed below will be sought from the IRS. The IRS might assert that each
trust should be treated as a separate grantor trust for United States Federal
income tax purposes, in which case the holders of beneficial interests in the
notes related to such trust would be treated as owning a pro rata undivided
interest in the assets of such trust. In such a case, the tax consequences to
beneficial owners of the notes would not be materially different than those
described herein. Persons considering the purchase of notes should consult their
own tax advisors about the United States Federal
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income tax consequences of an investment in the notes and the application of
United States Federal income tax laws, as well as the laws of any state, local
or foreign taxing jurisdictions, to their particular situations.
U.S. Holders
Payments of Interest
Except as described below, payments of interest on a note generally will be
taxable to a U.S. Holder as ordinary interest income at the time such payments
are accrued or are received (in accordance with the U.S. Holder's regular method
of tax accounting).
Discount Notes
The following summary is a general discussion of the United States Federal
income tax consequences to U.S. Holders of the purchase, ownership and
disposition of notes issued with original issue discount ("discount notes").
For United States Federal income tax purposes, original issue discount
("OID") is the excess of the stated redemption price at maturity of a note over
its issue price, if such excess equals or exceeds a de minimis amount (generally
1/4 of 1% of the note's stated redemption price at maturity multiplied by the
number of complete years to its maturity from its issue date or, in the case of
a note providing for the payment of any amount other than qualified stated
interest (as defined below) prior to maturity, multiplied by the weighted
average maturity of such note). The issue price of each note in an issue of
notes equals the first price at which a substantial amount of such notes has
been sold (ignoring sales to bond houses, brokers, or similar persons or
organizations acting in the capacity of underwriters, placement agents, or
wholesalers). The stated redemption price at maturity of a note is the sum of
all payments provided by the note other than "qualified stated interest"
payments. The term "qualified stated interest" generally means stated interest
that is unconditionally payable in cash or property (other than debt instruments
of the issuer) at least annually at a single fixed rate. In addition, if a note
bears interest for one or more accrual periods at a rate below the rate
applicable for the remaining term of such note (e.g., notes with teaser rates or
interest holidays), and if the greater of either the resulting foregone interest
on such note or any "true" discount on such note (i.e., the excess of the note's
stated principal amount over its issue price) equals or exceeds a specified de
minimis amount, then some or all of the stated interest on the note would be
treated as OID rather than qualified stated interest.
Payments of qualified stated interest on a note are taxable to a U.S.
Holder as ordinary interest income at the time such payments are accrued or are
received (in accordance with the U.S. Holder's regular method of tax
accounting). A U.S. Holder of a discount note must include OID in income as
ordinary interest for United States Federal income tax purposes as it accrues
under a constant yield method in advance of receipt of the cash payments
attributable to such income, regardless of such U.S. Holder's regular method of
tax accounting. In general, the amount of OID included in income by the initial
U.S. Holder of a discount note is the sum of the daily portions of OID with
respect to such discount note for each day during the taxable year (or portion
of the taxable year) on which such U.S. Holder held such discount note. The
"daily portion" of OID on any discount note is determined by allocating to each
day in any accrual period a ratable portion of the OID allocable to that accrual
period. An "accrual period" may be of any length and the accrual periods may
vary in length over the term of the discount note, provided that each accrual
period is no longer than one year and each scheduled payment of principal or
interest occurs either on the final day of an accrual period or on the first day
of an accrual period. The amount of OID allocable to each accrual period is
generally equal to the difference between:
o the product of the discount note's adjusted issue price at the
beginning of such accrual period and its yield to maturity (determined
on the basis of compounding at the close of each accrual period and
appropriately adjusted to take into account the length of the
particular accrual period); and
o the amount of any qualified stated interest payments allocable to such
accrual period. The "adjusted issue price" of a discount note at the
beginning of any accrual period is the sum of the issue price of the
discount note plus the amount of OID allocable to all prior accrual
periods minus the amount of any prior payments on the discount note
that were not qualified stated interest payments. Under these rules,
U.S. Holders generally will have to include in income increasingly
greater amounts of OID in successive accrual periods.
A U.S. Holder who purchases a discount note for an amount that is greater
than its adjusted issue price as of the purchase date and less than or equal to
the sum of all amounts payable on the discount note after the purchase date
other than payments of qualified stated interest, will be considered to have
purchased the discount note at an "acquisition premium."
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Under the acquisition premium rules, the amount of OID which such U.S. Holder
must include in its gross income with respect to such discount note for any
taxable year (or portion thereof in which the U.S. Holder holds the discount
note) will be reduced (but not below zero) by the portion of the acquisition
premium properly allocable to the period.
Floating Rate Notes
Floating rate notes are subject to special rules whereby a floating rate
note will qualify as a "variable rate debt instrument" if:
o its issue price does not exceed the total noncontingent principal
payments due under the floating rate note by more than a specified de
minimis amount;
o it provides for stated interest, paid or compounded at least annually,
at current values of, one or more qualified floating rates, a single
fixed rate and one or more qualified floating rate, or a single
objective rate; and
o it does not provide for any principal payments which are contingent.
A "qualified floating rate" is any variable rate where variations in the
value of such rate can reasonably be expected to measure contemporaneous
variations in the cost of newly borrowed funds in the currency in which the
floating rate note is denominated. Although a multiple of a qualified floating
rate will generally not itself constitute a qualified floating rate, a variable
rate equal to the product of a qualified floating rate and a fixed multiple that
is greater than .65 but not more than 1.35 will constitute a qualified floating
rate. A variable rate equal to the product of a qualified floating rate and a
fixed multiple that is greater than .65 but not more than 1.35, increased or
decreased by a fixed rate, will also constitute a qualified floating rate. In
addition, two or more qualified floating rates that can reasonably be expected
to have approximately the same values throughout the term of the floating rate
note (e.g., two or more qualified floating rates with values within 25 basis
points of each other as determined on the floating rate note's issue date) will
be treated as a single qualified floating rate. Notwithstanding the foregoing, a
variable rate that would otherwise constitute a qualified floating rate but
which is subject to one or more restrictions such as a maximum numerical
limitation (i.e., a cap) or a minimum numerical limitation (i.e., a floor) may,
under certain circumstances, fail to be treated as a qualified floating rate
unless such cap or floor is fixed throughout the term of the note. An "objective
rate" is a rate that is not itself a qualified floating rate but which is
determined using a single fixed formula and that is based on objective financial
or economic information. A rate will not qualify as an objective rate if it is
based on information that is within the control of Allstate Life (or a related
party) or that is unique to the circumstances of Allstate Life (or a related
party), such as dividends, profits, or the value of Allstate Life's stock
(although a rate does not fail to be an objective rate merely because it is
based on the credit quality of Allstate Life). In addition, if a floating rate
note provides for stated interest at a fixed rate for an initial period of one
year or less followed by a variable rate that is either a qualified floating
rate or an objective rate and if the variable rate on the floating rate note's
issue date is intended to approximate the fixed rate (e.g., the value of the
variable rate on the issue date does not differ from the value of the fixed rate
by more than 25 basis points), then the fixed rate and the variable rate
together will constitute either a single qualified floating rate or objective
rate, as the case may be.
If a floating rate note that provides for stated interest at either a
single qualified floating rate or a single objective rate throughout the term
thereof qualifies as a "variable rate debt instrument" and if the interest on
such note is unconditionally payable in cash or property (other than debt
instruments of the issuer) at least annually, then all stated interest on the
note will constitute qualified stated interest and will be taxed accordingly.
Thus, a floating rate note that provides for stated interest at either a single
qualified floating rate or a single objective rate throughout the term thereof
and that qualifies as a "variable rate debt instrument" will generally not be
treated as having been issued with OID unless the floating rate note is issued
at a "true" discount (i.e., at a price below the note's stated principal amount)
in excess of a specified de minimis amount. The amount of qualified stated
interest and the amount of OID, if any, that accrues during an accrual period on
such a floating rate note is determined under the rules applicable to fixed rate
debt instruments by assuming that the variable rate is a fixed rate equal to:
o in the case of a qualified floating rate, the value, as of the issue
date, of the qualified floating rate; or
o in the case of an objective rate, a fixed rate that reflects the yield
that is reasonably expected for the floating rate note. The qualified
stated interest allocable to an accrual period is the amount of
interest actually paid during such accrual period.
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In general, any other floating rate note that qualifies as a "variable rate
debt instrument" will be converted into an "equivalent" fixed rate debt
instrument for purposes of determining the amount and accrual of OID and
qualified stated interest on the floating rate note. A floating rate note is
converted into an "equivalent" fixed rate debt instrument by substituting any
qualified floating rate provided for under the terms of the floating rate note
with a fixed rate equal to the value of the qualified floating rate as of the
floating rate note's issue date. Any objective rate provided for under the terms
of the floating rate note is converted into a fixed rate that reflects the yield
that is reasonably expected for the floating rate note. In the case of a
floating rate note that qualifies as a "variable rate debt instrument" and
provides for stated interest at a single fixed rate in addition to either one or
more qualified floating rates or a qualified inverse floating rate, the fixed
rate is initially converted into a qualified floating rate. Under such
circumstances, the qualified floating rate that replaces the fixed rate must be
such that the fair market value of the floating rate note as of the floating
rate note's issue date is approximately the same as the fair market value of an
otherwise identical debt instrument that provides for either the qualified
floating rate rather than the fixed rate. Subsequent to converting the fixed
rate into either a qualified floating rate or a qualified inverse floating rate,
the floating rate note is then converted into an "equivalent" fixed rate debt
instrument in the manner described above.
Once the floating rate note is converted into an "equivalent" fixed rate
debt instrument pursuant to the foregoing rules, the amount of OID and qualified
stated interest, if any, are determined for the "equivalent" fixed rate debt
instrument by applying the general OID rules to the "equivalent" fixed rate debt
instrument. A U.S. Holder of the floating rate note will account for such OID
and qualified stated interest as if the U.S. Holder held the "equivalent" fixed
rate debt instrument. Each accrual period appropriate adjustments will be made
to the amount of qualified stated interest or OID assumed to have been accrued
or paid with respect to the "equivalent" fixed rate debt instrument in the event
that such amounts differ from the actual amount of interest accrued or paid on
the floating rate note during the accrual period.
If the floating rate note does not qualify as a "variable rate debt
instrument" then the floating rate note would be treated as a contingent payment
debt instrument. A U.S. Holder of a contingent payment debt instrument is
generally required to include future contingent and noncontingent interest
payments in income under the constant yield method as such interest accrues
based on Allstate Life's determination of the "comparable yield" and the
establishment of a "projected payment schedule" that must produce the comparable
yield. The comparable yield is the yield at which Allstate Life would issue a
fixed rated debt instrument with similar terms and conditions. The projected
payment schedule consists of all stated principal payments and a projected
amount and time for each contingent interest payment. If the actual amount of
any contingent payment, once determined, differs from the projected amounts,
appropriate adjustments are to be made to the amounts required to be included in
gross income by the U.S. Holder. The yield, timing and amounts set forth in the
projected payment schedule are for purposes of computing the OID only and are
not assurances by the trusts with respect to any aspect of the notes. Because
U.S. Holders will generally be bound by Allstate Life's determination of the
comparable yield and by the projected payment schedule for United States Federal
income tax purposes, a U.S. Holder's income inclusions may be accelerated
relative to the time payments under the notes are in fact made. The IRS has
authority to disregard a projected payment schedule it determines to be
unreasonable. Any gain recognized by a U.S. Holder on the sale, exchange, or
retirement of a contingent payment debt instrument will be treated as interest
income and all or a portion of any loss realized could be treated as ordinary
loss as opposed to capital loss (depending upon the circumstances). The United
States Federal income tax treatment of floating rate notes that are treated as
contingent payment debt instruments will be more fully described in the
applicable pricing supplement. Purchasers of contingent payment debt instruments
should carefully examine the applicable pricing supplement and should consult
their own tax advisor with respect to such notes.
Certain of the notes:
o may be redeemable at the option of the issuing trust prior to their
stated maturity (a "call option"); and/or
o may be repayable at the option of the holder prior to their stated
maturity (a "put option"). Notes containing such features may be
subject to rules that differ from the general rules discussed above.
Investors intending to purchase notes with such features should consult
their own tax advisors, since the OID consequences will depend, in part, on the
particular terms and features of the purchased notes.
U.S. Holders may generally, upon election, include in income all interest
(including stated interest, acquisition discount, OID, de minimis OID, market
discount, de minimis market discount, and unstated interest, as adjusted by any
amortizable bond premium or acquisition premium) that accrues on a debt
instrument by using the constant yield method applicable to OID, subject to
certain limitations and exceptions.
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Short-Term Notes
Notes that have a fixed maturity of one year or less ("short-term
notes") will be treated as having been issued with OID. In general, an
individual or other cash method U.S. Holder is not required to accrue such OID
unless the U.S. Holder elects to do so. If such an election is not made, any
gain recognized by the U.S. Holder on the sale, exchange or maturity of the
short-term note will be ordinary income to the extent of the OID accrued on a
straight-line basis, or upon election under the constant yield method (based on
daily compounding), through the date of sale or maturity, and a portion of the
deductions otherwise allowable to the U.S. Holder for interest on borrowings
allocable to the short-term note will be deferred until a corresponding amount
of income is realized. U.S. Holders who report income for United States Federal
income tax purposes under the accrual method, and certain other holders
including banks and dealers in securities, are required to accrue OID on a
short-term note on a straight-line basis unless an election is made to accrue
the OID under a constant yield method (based on daily compounding).
Market Discount
If a U.S. Holder purchases a note, other than a discount note, for an
amount that is less than its issue price (or, in the case of a subsequent
purchaser, its stated redemption price at maturity) or, in the case of a
discount note, for an amount that is less than its adjusted issue price as of
the purchase date, such U.S. Holder will be treated as having purchased such
note at a "market discount," unless such market discount is less than a
specified de minimis amount.
Under the market discount rules, a U.S. Holder will be required to treat
any partial principal payment (or, in the case of a discount note, any payment
that does not constitute qualified stated interest) on, or any gain realized on
the sale, exchange, retirement or other disposition of, a note as ordinary
income to the extent of the lesser of:
o the amount of such payment or realized gain; and
o the market discount which has not previously been included in income
and is treated as having accrued on such note at the time of such
payment or disposition.
Market discount will be considered to accrue ratably during the period from
the date of acquisition to the maturity date of the note, unless the U.S. Holder
elects to accrue market discount on the basis of semiannual compounding.
A U.S. Holder may be required to defer the deduction of all or a portion of
the interest paid or accrued on any indebtedness incurred or maintained to
purchase or carry a note with market discount until the maturity of the note or
certain earlier dispositions, because a current deduction of such holder's "net
direct interest expense" is only allowed to the extent the interest expense
exceeds an allocable portion of market discount. Net direct interest expense is
the excess of interest paid or accrued to purchase or carry the market discount
note over the interest (including OID) includible in the purchaser's gross
income. A U.S. Holder may elect to include market discount in income currently
as it accrues (on either a ratable or semiannual compounding basis), in which
case the rules described above regarding the treatment as ordinary income of
gain upon the disposition of the note, the receipt of certain cash payments and
the deferral of interest deductions will not apply. Generally, such currently
included market discount is treated as ordinary interest for United States
Federal income tax purposes. Such an election will apply to all debt instruments
acquired by the U.S. Holder on or after the first day of the first taxable year
to which such election applies and may be revoked only with the consent of the
IRS.
Premium
If a U.S. Holder purchases a note for an amount that is greater than its
stated redemption price at maturity, such U.S. Holder will generally be
considered to have purchased the note with "amortizable bond premium" equal in
amount to such excess. A U.S. Holder may elect to amortize such premium using a
constant yield method over the remaining term of the note and may offset
interest otherwise required to be included in gross income in respect of the
note during any taxable year by the amortized amount of such excess for the
taxable year. However, if the note may be optionally redeemed after the U.S.
Holder acquires it at a price in excess of its stated redemption price at
maturity, special rules would apply which could result in a deferral of the
amortization of some bond premium until later in the term of the note. Any
election to amortize bond premium applies to all taxable debt instruments held
or acquired by the U.S. Holder on or after the first day of the first taxable
year to which such election applies and may be revoked only with the consent of
the IRS.
S-47
Disposition of a Note
Upon the sale, exchange, redemption, retirement or other disposition of a
note, a U.S. Holder generally will recognize taxable gain or loss equal to the
difference between the amount realized on the sale, exchange, redemption,
retirement or other disposition (other than amounts representing accrued and
unpaid interest, which will constitute ordinary income) and such U.S. Holder's
adjusted tax basis in the note. A U.S. Holder's adjusted tax basis in a note
generally will equal such U.S. Holder's initial investment in the note increased
by any OID included in income (and accrued market discount, if any, if the U.S.
Holder has included such market discount in income) and decreased by the amounts
of any payments, other than qualified stated interest payments, received and the
amortizable bond premium taken into account with respect to such note. Such gain
or loss generally will be long-term capital gain or loss if the note were held
for more than one year. Non-corporate taxpayers are subject to reduced maximum
rates on long-term capital gains and are generally subject to tax at ordinary
income rates on short-term capital gains. The deductibility of capital losses is
subject to certain limitations. Prospective investors should consult their own
tax advisors concerning these tax law provisions.
If a U.S. Holder disposes of only a portion of a note pursuant to a partial
redemption or partial repayment (e.g., pursuant to the survivor's option, if
applicable), such disposition will be treated as a redemption or repayment of a
portion of a debt instrument. The resulting gain or loss would be calculated by
assuming that the original note being tendered consists of two instruments, one
that is retired (or repaid), and one that remains outstanding. The adjusted
issue price, the U.S. Holder's adjusted basis, and the accrued but unpaid OID of
the original note, if any, determined immediately before the disposition, would
be allocated between these two instruments based on the portion of the
instrument that is treated as retired by the redemption or repayment.
Non-U.S. Holders
Payments of interest (including OID, if any) on a note received by a
non-U.S. Holder that does not hold its notes in connection with the conduct of a
trade or business in the United States, will generally not be subject to United
States Federal withholding tax pursuant to the "Portfolio Interest Exemption"
unless:
o the non-U.S. Holder is a direct or indirect 10% or greater shareholder
of Allstate Life;
o the non-U.S. Holder is a controlled foreign corporation related to
Allstate Life;
o the non-U.S. Holder is a bank receiving interest described in section
881(c)(3)(A) of the Code; or
o interest on the note is contingent interest described in section
871(h)(4) of the Code.
To qualify for the Portfolio Interest Exemption from United States Federal
withholding tax, the last United States payor in the chain of payment prior to
payment to a non-U.S. Holder (the "withholding agent") must have received in the
year in which a payment of interest or principal occurs, or in either of the two
preceding calendar years, a statement that:
o is signed by the beneficial owner of the note under penalties of
perjury;
o certifies that such owner is not a U.S. Holder; and
o provides the name and address of the beneficial owner.
The statement may be made on an IRS Form W-8BEN or a substantially similar
form, and the beneficial owner must inform the withholding agent of any change
in the information on the statement within 30 days of such change. If a note is
held through a securities clearing organization or certain other financial
institutions, the organization or institution may provide a signed statement to
the withholding agent. However, in such a case, the signed statement generally
must be accompanied by a copy of the IRS Form W-8BEN or the substitute form
provided by the beneficial owner to the organization or institution.
If a non-U.S. Holder cannot satisfy the requirements for eligibility for
the Portfolio Interest Exemption, interest earned by such non-U.S. Holder will
be subject to United States Federal withholding tax at a 30% rate unless the
non-U.S. Holder provides the withholding agent with a properly executed:
S-48
o IRS Form W-8BEN claiming an exemption from or reduction in withholding
under the benefit of a United States income tax treaty; or
o IRS Form W-8ECI stating that interest paid on the note is not subject
to withholding tax because it is effectively connected with the
non-U.S. Holder's conduct of a trade or business in the United States.
Notwithstanding the provision of IRS Form W-8ECI, a non-U.S. Holder that
holds its notes in connection with its conduct of a trade or business in the
United States will be taxed on its notes in the same manner as a U.S. Holder,
and, if such non-U.S. Holder is a foreign corporation, it may also be subject to
a branch profits tax equal to 30% of its effectively connected earnings and
profits for the taxable year, subject to adjustments.
Generally, a non-U.S. Holder will not be subject to United States Federal
income taxes on any amount which constitutes capital gain upon the sale,
exchange, redemption, retirement or other disposition of a note, provided:
o the gain is not effectively connected with the conduct of a trade or
business in the United States by the non-U.S. Holder; and
o the non-U.S. Holder is not an individual who is present in the United
States for 183 days or more during the taxable year.
Certain other exceptions may be applicable, and a non-U.S. Holder should
consult its tax advisor in this regard.
The notes will not be includible in the estate of a non-U.S. Holder unless
the individual is a direct or indirect 10% or greater shareholder of Allstate
Life or, at the time of such individual's death, payments in respect of the
notes would have been effectively connected with the conduct by such individual
of a trade or business in the United States. If any portion of the interest
payable on the notes at the time of the individual's death was contingent
interest, then an appropriate portion of the value of the notes would be
includible in the estate of a non-U.S. Holder.
Backup Withholding and Information Reporting
Backup withholding of United States Federal income tax at the applicable
backup withholding rate may apply to payments made in respect of the notes to
registered owners who are not "exempt recipients" and who fail to provide
certain identifying information (such as the registered owner's taxpayer
identification number) in the required manner. Generally, individuals are not
exempt recipients, whereas corporations and certain other entities generally are
exempt recipients. Payments made in respect of the notes to a U.S. Holder must
be reported to the IRS, unless the U.S. Holder is an exempt recipient or
establishes an exemption. Compliance with the identification procedures
described in the preceding section would establish an exemption from backup
withholding for those non-U.S. Holders who are not exempt recipients.
In addition, upon the sale of a note to (or through) a broker, the broker
must withhold at the applicable backup withholding rate of the entire purchase
price, unless either the broker determines that the seller is a corporation or
other exempt recipient or the seller provides, in the required manner, certain
identifying information and, in the case of a non-U.S. Holder, certifies that
such seller is a non-U.S. Holder (and certain other conditions are met). Such a
sale must also be reported by the broker to the IRS, unless either the broker
determines that the seller is an exempt recipient or the seller certifies its
non-U.S. status (and certain other conditions are met). Certification of the
registered owner's non-U.S. status would be made normally on an IRS Form W-8BEN
under penalties of perjury, although in certain cases it may be possible to
submit other documentary evidence.
Any amounts withheld under the backup withholding rules from a payment to a
beneficial owner would be allowed as a refund or a credit against such
beneficial owner's United States Federal income tax provided the required
information is furnished to the IRS.
Opinion Regarding Tax Matters
Prior to the issuance of any notes, Allstate Life will file as an exhibit
to a Current Report on Form 8-K an opinion of legal counsel as described above
regarding the tax treatment of such notes.
S-49
PLAN OF DISTRIBUTION
The notes of a series will be offered to or through Merrill Lynch, Pierce,
Fenner & Smith Incorporated, as Purchasing Agent, pursuant to a terms agreement
among Global Funding, the issuing trust and the Purchasing Agent (each, a "terms
agreement") and the distribution agreement among Global Funding and the Agents
named therein, dated as of February -, 2006 (the "distribution agreement"). Each
terms agreement will incorporate by reference the terms of the distribution
agreement. The Purchasing Agent may purchase notes, as principal, from a trust
for resale to investors at a fixed offering price or at varying prices relating
to prevailing market prices at the time of resale as determined by the
Purchasing Agent. The issuing trust may agree with the Purchasing Agent that the
Purchasing Agent will utilize its reasonable efforts on an agency basis on its
behalf to solicit offers to purchase notes of the applicable series at 100% of
the principal amount thereof, unless otherwise specified in the applicable
pricing supplement. Unless otherwise specified in the applicable pricing
supplement, each trust will pay a commission to the Purchasing Agent, ranging
from .125% to 2.50% of the principal amount of each applicable note, depending
upon its stated maturity, for each note purchased from the issuing trust by the
Purchasing Agent as its agent. The notes may be sold in the United States to
retail, institutional and other investors.
Subject to the terms of the applicable terms agreement and the distribution
agreement, concurrently with any offering of a series of notes by a trust as
described in this prospectus supplement, the issuing trust and the other trusts
may issue other notes under this program or the related secured medium term note
program.
Each trust will use the net proceeds received from the issuance of the
related series of notes to purchase a funding note from Global Funding. Global
Funding will use the net proceeds received from the sale of such funding note to
purchase one or more funding agreements issued by Allstate Life. Global Funding
will immediately assign absolutely to, and deposit into, the issuing trust each
such funding agreement and the related funding note will be cancelled
immediately upon the assignment and deposit by Global Funding of such funding
agreement(s) to and into the issuing trust.
Unless otherwise specified in the applicable pricing supplement, any note
sold to the Purchasing Agent as principal will be purchased by the Purchasing
Agent at a price equal to 100% of the principal amount thereof less a percentage
of the principal amount equal to the commission applicable to an agency sale of
a note of identical maturity. The Purchasing Agent may sell notes it has
purchased from a trust as principal to other NASD dealers in good standing at a
concession. Unless otherwise specified in the applicable pricing supplement, the
concession allowed to any dealer will not, during the distribution of the notes
of a series, be in excess of the concession the Purchasing Agent will receive
from the issuing trust. After the initial offering of notes of a series, the
offering price, the concession and any reallowance may be changed.
The offer made hereby may be modified without notice, and each trust may
reject offers in whole or in part (whether placed directly by an issuing trust
or through the Purchasing Agent). The Purchasing Agent will have the right, in
its discretion reasonably exercised, to reject in whole or in part any offer to
purchase notes received by it on an agency basis.
Unless otherwise specified in the applicable pricing supplement, you will
be required to pay the purchase price of your notes in immediately available
funds in United States dollars in The City of New York on the date of
settlement.
Upon issuance, the notes of a series will not have an established trading
market. There can be no assurance that a trading market for your notes will ever
develop or be maintained if developed. Unless otherwise specified in the
applicable pricing supplement, a series of notes will not be listed on any
securities exchange. The Purchasing Agent may from time to time purchase and
sell notes in the secondary market, but the Purchasing Agent is not obligated to
do so. There can be no assurance that a secondary market for the notes will
develop or that there will be liquidity in the secondary market if one develops.
From time to time, the Purchasing Agent may make a market in the notes, but the
Purchasing Agent is not obligated to do so and may discontinue any market-making
activity at any time.
In connection with an offering of notes purchased by the Purchasing Agent
as principal on a fixed offering price basis, the Purchasing Agent will be
permitted to engage in certain transactions that stabilize the price of notes.
These transactions may consist of bids or purchases for the purpose of pegging,
fixing or maintaining the price of notes. If the Purchasing Agent creates a
short position in notes (i.e., if it sells notes in an amount exceeding the
amount specified in the applicable pricing supplement), they may reduce that
short position by purchasing notes in the open market. In general, purchases of
notes for the purpose of stabilization or to reduce a short position could cause
the price of notes to be higher than it might be in the absence of these type of
purchases.
Neither Global Funding and the trusts nor the Purchasing Agent make any
representation or prediction as to the direction or magnitude of any effect that
the transactions described in the immediately preceding paragraph may have on
the price of notes. In addition, neither Global Funding and the trusts nor the
Purchasing Agent make any representation that the
S-50
Purchasing Agent will engage in any such transactions or that such transactions,
once commenced, will not be discontinued without notice.
The Purchasing Agent will be an "underwriter," with respect to the notes
being distributed by it and the funding agreements being purchased by the
issuing trust, and any discounts or commissions received by it on the sale or
resale of notes may be deemed to be underwriting discounts and commissions under
the Securities Act. The Purchasing Agent may be entitled under agreements
entered into with a trust, Global Funding and Allstate Life to indemnification
against certain civil liabilities, including liabilities under the Securities
Act, or to contribution with respect to payments that the Purchasing Agent may
be required to make in respect of such liabilities.
Global Funding is a statutory issuer of the notes and the funding notes
under the Securities Act, and Allstate Life is the issuer of the funding
agreements under the Securities Act. In addition, under the Securities Act, each
trust is a statutory underwriter of each funding agreement and each funding note
purchased with the proceeds from the issuance of such trust's notes.
In the ordinary course of its business, the Purchasing Agent and its
affiliates have engaged, and may in the future engage, in investment and
commercial banking transactions with Allstate Life and certain of its
affiliates.
Broker-dealers and securities firms have executed dealer agreements with
the Purchasing Agent and have agreed to market and sell the notes in accordance
with the terms of those agreements and applicable laws and regulations.
The issuing trusts may sell other securities referred to in the
accompanying prospectus, and the amount of notes offered by this prospectus
supplement may be reduced as a result of those sales.
S-51
ANNEX A
REPAYMENT ELECTION FORM
Allstate Life Global Funding
Allstate Life(R) CoreNotes(R)
Cusip Number
To: [Name of trust]
The undersigned financial institution (the "Financial Institution")
represents the following:
o The Financial Institution has received a request for repayment from
the executor or other authorized representative (the "Authorized
Representative") of the deceased beneficial owner listed below (the
"Deceased Beneficial Owner") of Allstate Life(R) CoreNotes(R) (CUSIP
No. ) (the "Notes").
o At the time of his or her death, the Deceased Beneficial Owner owned
Notes in the principal amount listed below.
o The Deceased Beneficial Owner acquired the Notes at least six months
before the date of death of such Deceased Beneficial Owner.
o The Financial Institution currently holds such Notes as a direct or
indirect participant in The Depository Trust Company (the
"Depositary"). The Financial Institution agrees to the following
terms:
o The Financial Institution shall follow the instructions (the
"Instructions") accompanying this Repayment Election Form (this
"Form").
o The Financial Institution shall make all records specified in the
Instructions supporting the above representations available to J.P.
Morgan Trust Company, National Association (the "Trustee") or [Name of
trust] (the "Trust") for inspection and review within five Business
Days of the Trustee's or the Trust's request.
o If the Financial Institution, the Trustee or the Trust, in any such
party's reasonable discretion, deems any of the records specified in
the Instructions supporting the above representations unsatisfactory
to substantiate a claim for repayment, the Financial Institution shall
not be obligated to submit this Form, and the Trustee or Trust may
deny repayment. If the Financial Institution cannot substantiate a
claim for repayment, it shall notify the Trustee immediately.
o Repayment elections may not be withdrawn.
o The Financial Institution agrees to indemnify and hold harmless the
Trustee and the Trust against and from any and all claims,
liabilities, costs, losses, expenses, suits and damages resulting from
the Financial Institution's above representations and request for
repayment on behalf of the Authorized Representative.
o The Notes will be repaid on the first Interest Payment Date to occur
at least 20 calendar days after the date of acceptance of the Notes
for repayment, unless such date is not a business day, in which case
the date of repayment shall be the next succeeding business day.
o Subject to the Trust's rights to limit the aggregate principal amount
of Notes as to which exercises of the survivor's option shall be
accepted in any one calendar year, all questions as to the eligibility
or validity of any exercise of the survivor's option will be
determined by the Trustee, in its sole discretion, which determination
shall be final and binding on all parties.
A-1
REPAYMENT ELECTION FORM
(1) Name of Deceased Beneficial Owner
(2) Date of Death
(3) Name of Authorized Representative Requesting Repayment
(4) Name of Financial Institution Requesting Repayment
(5) Signature of Authorized Representative of Financial Institution
Requesting Repayment
(6) Principal Amount of Requested Repayment
(7) Date of Election
(8) Financial Institution Representative Name: Phone Number: Fax Number:
Mailing Address (no P.O. Boxes):
(9) Wire instructions for payment:
Bank Name:
ABA Number:
Account Name:
Account Number:
Reference (optional):
A-2
TO BE COMPLETED BY THE TRUSTEE:
(A) Election Number*:
(B) Delivery and Payment Date:
(C) Principal Amount:
(D) Accrued Interest:
(E) Date of Receipt of Form by the Trustee:
(F) Date of Acknowledgment by the Trustee:
- ---------------
* To be assigned by the Trustee upon receipt of this Form. An acknowledgement,
in the form of a copy of this document with the assigned Election Number, will
be returned to the party and location designated in item (8) above.
A-3
INSTRUCTIONS FOR COMPLETING REPAYMENT ELECTION FORM AND EXERCISING REPAYMENT
OPTION
Capitalized terms used and not defined herein have the meanings defined in
the accompanying Repayment Election Form.
1. Collect and retain for a period of at least three years (1) satisfactory
evidence of the authority of the Authorized Representative, (2)
satisfactory evidence of death of the Deceased Beneficial Owner, (3)
satisfactory evidence that the Deceased Beneficial Owner beneficially
owned, at the time of his or her death, the Notes being submitted for
repayment, (4) satisfactory evidence that the Notes being submitted for
repayment was acquired by the Deceased Beneficial Owner at least six months
before the date of the death of such Deceased Beneficial Owner, and (5) any
necessary tax waivers. For purposes of determining whether the Notes will
be deemed beneficially owned by an individual at any given time, the
following rules shall apply:
o If a Note (or a portion thereof) is beneficially owned by tenants by
the entirety or joint tenants, the Note (or relevant portion thereof)
will be regarded as beneficially owned by a single owner. Accordingly,
the death of a tenant by the entirety or joint tenant will be deemed
the death of the beneficial owner and the entire principal amount so
owned will become eligible for repayment.
o The death of a person beneficially owning a Note (or a portion
thereof) by tenancy in common will be deemed the death of the
beneficial owner only with respect to the deceased owner's interest in
the Note (or relevant portion thereof) so owned, unless a husband and
wife are the tenants in common, in which case the death of either will
be deemed the death of the beneficial owner and the entire principal
amount so owned will be eligible for repayment.
o A Note (or a portion thereof) beneficially owned by a trust will be
regarded as beneficially owned by each beneficiary of the trust to the
extent of that beneficiary's interest in the trust (however, a trust's
beneficiaries collectively cannot be beneficial owners of more Notes
than are owned by the trust). The death of a beneficiary of a trust
will be deemed the death of the beneficial owner of the Notes (or
relevant portion thereof) beneficially owned by the trust to the
extent of that beneficiary's interest in the trust. The death of an
individual who was a tenant by the entirety or joint tenant in a
tenancy which is the beneficiary of a trust will be deemed the death
of the beneficiary of the trust. The death of an individual who was a
tenant in common in a tenancy which is the beneficiary of a trust will
be deemed the death of the beneficiary of the trust only with respect
to the deceased holder's beneficial interest in the Note, unless a
husband and wife are the tenants in common, in which case the death of
either will be deemed the death of the beneficiary of the trust.
o The death of a person who, during his or her lifetime, was entitled to
substantially all of the beneficial interest in a Note (or a portion
thereof) will be deemed the death of the beneficial owner of that Note
(or relevant portion thereof), regardless of the registration of
ownership, if such beneficial interest can be established to the
satisfaction of the Trustee. Such beneficial interest will exist in
many cases of street name or nominee ownership, custodial
arrangements, ownership by a trustee, ownership under the Uniform
Transfers of Gifts to Minors Act and community property or other joint
ownership arrangements between spouses. Beneficial interest will be
evidenced by such factors as the power to sell or otherwise dispose of
a Note, the right to receive the proceeds of sale or disposition and
the right to receive interest and principal payments on a Note.
2. Indicate the name of the Deceased Beneficial Owner on line (1).
3. Indicate the date of death of the Deceased Beneficial Owner on line (2).
4. Indicate the name of the Authorized Representative requesting repayment on
line (3).
5. Indicate the name of the Financial Institution requesting repayment on line
(4).
6. Affix the authorized signature of the Financial Institution's
representative on line (5). THE SIGNATURE MUST BE MEDALLION SIGNATURE
GUARANTEED.
7. Indicate the principal amount of Notes to be repaid on line (6).
8. Indicate the date this Form was completed on line (7).
A-4
9. Indicate the name, mailing address (no P.O. boxes, please), telephone
number and facsimile-transmission number of the party to whom the
acknowledgment of this election may be sent in item (8).
10. Indicate the wire instruction for payment on line (9).
11. Leave lines (A), (B), (C), (D), (E) and (F) blank.
12. Mail or otherwise deliver an original copy of the completed Form to:
J.P. Morgan Trust Company, National Association
2001 Bryan Street, 9th Floor
Dallas, TX 75201
Attention: Institutional Trust Services
FACSIMILE TRANSMISSIONS OF THE REPAYMENT ELECTION FORM WILL NOT BE
ACCEPTED.
13. If the acknowledgement of the Trustee's receipt of this Form, including the
assigned Election Number, is not received within 10 days of the date such
information is sent to the Trustee, contact the Trustee at J.P. Morgan
Trust Company, National Association, 227 W. Monroe Street, Suite 2600,
Chicago, IL 60606.
For assistance with this Form or any questions relating thereto, please
contact the Trustee at J.P. Morgan Trust Company, National Association, 227 W.
Monroe Street, Suite 2600, Chicago, IL 60606.
A-5
ANNEX B
FORM OF PRICING SUPPLEMENT
Filed pursuant to Rule 424(b)[ ]
Registration Statement No. 333-129157
Pricing Supplement No. [ ] Dated [ ]
(To Prospectus dated [ ], and
Prospectus Supplement dated [ ])
CUSIP: [ ]
Allstate Life Global Funding
Allstate Life(R) CoreNotes(R)
Issued Through
Allstate Life Global Funding Trust [ ]
The description in this pricing supplement of the particular terms of
the Allstate Life(R) CoreNotes(R)offered hereby (the "Notes"), the Funding
Agreement(s) (specified below) issued by Allstate Life Insurance Company
("Allstate Life") and deposited into Allstate Life Global Funding Trust [ ] (the
"Trust") by Allstate Life Global Funding ("Global Funding") and the Funding Note
(specified below) issued by Global Funding to the Trust supplements the
description of the general terms and provisions of the notes, the funding
agreements and the funding notes set forth in the accompanying prospectus and
prospectus supplement, to which reference is hereby made.
The Notes represent the obligation of the Trust and constitute
asset-backed securities within the meaning of Regulation AB under the Securities
Act of 1933, as amended.
THE NOTES
Principal Amount: [ ] Agent(s) Discount: [ ]
Issue Price: [ ] Original Issue Date: [ ]
Net Proceeds to the Trust: [ ] Stated Maturity Date: [ ]
Specified Currency: United States Dollars
Interest Payment Dates: [ ] Depositary: [The Depository Trust Company]
Initial Interest Payment Date: [ ]
Regular Record Date: [15 calendar days prior to the Interest Payment Date]
Fiscal Year of Trust (not applicable unless different than as specified in the
prospectus and prospectus supplement): [ ]
Type of Interest Rate: [[ ] Fixed Rate] [[ ] Floating Rate]
Fixed Rate Notes: [[ ] Yes] [[ ] No]. If, Yes,
Interest Rate: [ ]
Floating Rate Notes: [[ ] Yes] [[ ] No]. If, Yes,
Regular Floating Rate Notes: [[ ] Yes] [[ ] No]. If, Yes,
Interest Rate: [ ]
Interest Rate Basis(es): [ ]
Floating Rate/Fixed Rate Notes: [[ ] Yes] [[ ] No]. If, Yes,
Floating Interest Rate: [ ]
Interest Rate Basis(es): [ ]
Fixed Interest Rate: [ ]
Fixed Rate Commencement Date: [ ]
Initial Interest Rate, if any: [ ]
Initial Interest Reset Date: [ ]
Interest Rate Basis(es). Check all that apply:
[ ] CD Rate [ ] Federal Funds Rate
[ ] CMT Rate [ ] LIBOR
[ ] Commercial Paper Rate [ ] Prime Rate
[ ] Constant Maturity Swap Rate [ ] Treasury Rate
[ ] Federal Funds Open Rate
[If LIBOR:]
LIBOR Page: [ ]
[ ] LIBOR Moneyline Telerate: [ ] LIBOR Reuters:
LIBOR Currency: United States Dollars
[If CMT Rate:]
Designated CMT Moneyline Telerate Page:
[If CMT Moneyline Telerate Page 7052:] [[ ] Weekly Average]
[[ ] Monthly Average]
Designated CMT Maturity Index: [ ]
Index Maturity: [ ]
Spread (+/-): [ ]
Spread Multiplier: [ ]
Interest Reset Date(s): [ ]
Interest Determination Date(s): [ ]
Maximum Interest Rate, if any: [ ]
Minimum Interest Rate, if any: [ ]
Calculation Agent, if any: [J.P. Morgan Trust Company, National Association]
Computation of Interest (not applicable unless different than as specified in
the prospectus and prospectus supplement):
B-2
Day Count Convention (not applicable unless different than as specified in the
prospectus and prospectus supplement):
Discount Notes: [[ ] Yes] [[ ] No]. If, Yes,
Total Amount of Discount: [ ]
Initial Accrual Period of Discount: [ ]
Additional/Other Terms: [ ]
Terms of Survivor's Option: [[ ] Yes] [[ ] No]. If, Yes,
Annual Put Limitation: [ ] As specified in the prospectus and prospectus
supplement; or
[ ] $[ ]
Individual Put Limitation: [ ] As specified in the prospectus and prospectus
supplement; or
[ ] $[ ]
Trust Put Limitation: [ ] $[ ]
Redemption Provisions: [[ ] Yes] [[ ] No]. If, Yes,
Initial Redemption Date: [ ]
Initial Redemption Percentage: [ ]
Annual Redemption Percentage Reduction (if any):
[ ]
Redemption: [[ ] In whole only and not in part]
[[ ] May be in whole or in part]
Additional/Other Terms:
Sinking Fund (not applicable unless specified):
Securities Exchange Listing: [[ ] Yes] [[ ] No]. If Yes, Name of Exchange:
Authorized Denominations: [$1,000]
Ratings:
The Notes issued under the Program are rated "AA" by Standard & Poor's, a division of The Mc-Graw Hill Companies, Inc.
("S&P"). It is anticipated that Moody's Investors Service, Inc. ("Moody's") will rate the Notes "Aa2" on the Original
Issue Date.
Agent(s) Purchasing Notes as Principal: [[ ] Yes] [[ ] No]. If Yes,
Agent(s) Principal Amount
[ ]
Total: [ ]
======================
Agent(s) Acting as Agent: [[ ] Yes] [[ ] No]. If Yes,
Agent(s) Principal Amount
[ ] [ ]
Total: [ ]
Additional/Other Terms: [ ]
Special Tax Considerations: [ ]
B-3
THE FUNDING AGREEMENT(S)
Funding Agreement Issuer: Allstate Life Insurance Company
Funding Agreement No.: [ ]
Deposit Amount: [ ]
Issue Price: [ ]
Net Deposit Amount: [ ]
Effective Date: [ ]
Specified Currency: United States Dollars
Interest Payment Dates: [ ]
Initial Interest Payment Date: [ ]
Type of Interest Rate: [[ ] Fixed Rate] [[ ] Floating Rate]
Fixed Rate Funding Agreement: [[ ] Yes] [[ ] No]. If Yes,
Interest Rate: [ ]
Floating Rate Funding Agreement: [[ ] Yes] [[ ] No]. If Yes,
Floating Rate Funding Agreement: [[ ] Yes] [[ ] No]. If Yes,
Interest Rate: [ ]
Interest Rate Basis(es): [ ]
Floating Rate/Fixed Rate Funding Agreement: [[ ] Yes] [[ ] No]. If Yes,
Floating Interest Rate: [ ]
Interest Rate Basis(es): [ ]
Fixed Interest Rate: [ ]
Fixed Rate Commencement Date: [ ]
Initial Interest Rate, if any: [ ]
Initial Interest Reset Date: [ ]
Interest Rate Basis(es). Check all that apply:
[ ] CD Rate [ ] Commercial Paper Rate
[ ] CMT Rate [ ] Eleventh District Cost of Funds Rate
[ ] Constant Maturity Swap Rate [ ] Federal Funds Open Rate
[ ] LIBOR [ ] Federal Funds Rate
[ ] Prime Rate [ ] Treasury Rate
[If LIBOR:]
LIBOR Page: [ ]
[ ] LIBOR Moneyline Telerate: [ ] LIBOR Reuters:
B-4
LIBOR Currency: [ ]
[If CMT Rate:]
Designated CMT Moneyline Telerate Page: [ ]
[[ ] Weekly Average]
[If CMT Moneyline Telerate Page 7052:] [[ ] Monthly Average]
Designated CMT Maturity Index: [ ]
Index Maturity: [ ]
Spread (+/-): [ ]
Spread Multiplier: [ ]
Interest Reset Date(s): [ ]
Interest Determination Date(s): [ ]
Maximum Interest Rate, if any: [ ]
Minimum Interest Rate, if any: [ ]
Calculation of Interest: [ ]
Day Count Convention: [ ]
Additional/Other Terms: [ ]
Discount Funding Agreement: [[ ] Yes] [[ ] No]. If Yes,
Total Amount of Discount: [ ]
Initial Accrual Period of Discount: [ ]
Additional/Other Terms: [ ]
Redemption Provisions: [[ ] Yes] [[ ] No]. If Yes,
Initial Redemption Date: [ ]
Initial Redemption Percentage: [ ]
Annual Redemption Percentage Reduction
(if any): [ ]
Redemption: [[ ] In whole only and not in part]
[[ ] May be in whole or in part]
Additional/Other Terms: [ ]
Repayment: [ ]
Sinking Fund (not applicable unless specified): [ ]
Ratings:
B-5
The Funding Agreements issued under the Program are rated AA by S&P. It is
anticipated that the Funding Agreement(s) will be rated Aa2 by Moody's on the
Original Issue Date.
Additional/Other Terms, if any: [ ]
Special Tax Considerations: [ ]
THE FUNDING NOTE
Funding Note Issuer: Allstate Life Global Funding
Funding Note No.: [ ]
Principal Amount: [ ]
The Funding Note will otherwise have payment and other terms substantially
similar to the Funding Agreement(s) and the Notes, except that the terms of the
Funding Note will provide that it will be cancelled immediately upon the sale
of, and deposit into, the Trust by Global Funding of the Funding Agreement(s).
B-6
==============================================================================
$5,000,000,000
Allstate Life Global Funding
Depositor
Allstate Life(R) CoreNotes(R)
Due Between Nine Months and 30 Years From the Date of Issue
Issued Through
Allstate Life Global Funding Trusts
Secured by
Funding Agreements Issued by
Allstate Life Insurance Company
Sponsor
------------------
PROSPECTUS SUPPLEMENT
------------------
Merrill Lynch & Co.
-, 2006
"Allstate Life(R)" is a registered service mark of Allstate Insurance Company.
"CoreNotes(R)" is a registered service mark of Merrill Lynch & Co., Inc.
===============================================================================
Subject to Completion
Preliminary Prospectus dated o, 2006
PROSPECTUS
$5,000,000,000
Allstate Life Global Funding
Depositor
Secured Medium Term Notes
Allstate Life(R) CoreNotes(R)
Issued Through
Allstate Life Global Funding Trusts
Secured by
Funding Agreemments Issued by
Allstate Life Insurance Company
Sponsor
------------------
Allstate Life Global Funding (the "depositor" or "Global Funding") is a
statutory trust formed under the laws of the State of Delaware. Its primary
purpose is to facilitate the programs for the issuance of one or more series of
secured medium term notes (the "notes"), including, in connection with each
offering of notes, to issue the applicable funding note (each, a "funding
note"), as more fully described herein. Each series of notes will be issued by a
newly created separate and distinct Delaware statutory trust (each, a "trust").
Global Funding will be the sole beneficial owner of each trust that is formed
and the depositor of the funding agreements into the issuing trusts. The notes
may have an aggregate principal amount of up to $5,000,000,000 or the equivalent
amount in one or more foreign or composite currencies.
The notes of each series will represent the obligations of the issuing
trust and will constitute "asset-backed securities" within the meaning of
Regulation AB under the Securities Act of 1933, as amended.
In connection with the issuance of a series of notes, the issuing trust
will acquire one or more funding agreements issued by Allstate Life Insurance
Company ("Allstate Life"). The notes of a series will be secured by the right,
title and interest of the issuing trust in and to (1) the funding agreement(s)
held by that trust, (2) all proceeds of such funding agreement(s) and (3) all
books and records pertaining to such funding agreement(s).
The notes of a series will represent the unconditional, direct,
non-recourse, secured and unsubordinated obligations of the issuing trust only,
will not represent the obligations of, or interest in, any other trust, Global
Funding, Allstate Life or any of their respective affiliates and will rank
equally among themselves. Each series of notes will be secured by and payable
solely out of the assets of the issuing trust, and holders of such series of
notes will have no rights against the assets of Global Funding or the assets of
any other trust.
The notes of a series may be listed on a securities exchange.
Neither the Securities and Exchange Commission, any state securities
commission nor any state insurance commission has approved or disapproved of
these securities or determined if this prospectus, any prospectus supplement or
any pricing supplement is truthful or complete. Any representation to the
contrary is a criminal offense.
The trusts may sell the secured medium term notes referred to herein to one
or more of the agents referred to below (collectively, the "Agents") as
principals for resale at varying or fixed offering prices or through the
applicable Agent(s) as agents using their reasonable efforts on behalf of each
issuing trust. The trusts may also sell secured medium term notes directly to
investors without the assistance of any Agent. Unless otherwise specified in the
applicable pricing supplement, any secured medium term note sold to an Agent as
principal will be purchased by that Agent at a price equal to 100% of the
principal amount thereof less a percentage of the principal amount equal to the
commission applicable to an agency sale of a note of identical maturity. Unless
otherwise specified in the applicable pricing supplement, each trust will pay a
commission to an Agent, ranging from .150% to .875% of the principal amount of
each secured medium term note, depending upon its stated maturity, sold through
that Agent as its agent.
Each trust may sell its Allstate Life(R) CoreNotes(R) to Merrill Lynch,
Pierce, Fenner & Smith Incorporated (the "Purchasing Agent") as principal for
resale at a fixed offering price specified in the applicable pricing supplement
or at varying prices. Each trust may also explicitly agree with the Purchasing
Agent that it will use its reasonable efforts as agent on behalf of the issuing
trust to solicit offers to purchase Allstate Life(R) CoreNotes(R) of the
applicable series from that trust at 100% of the principal amount thereof,
unless otherwise specified in the applicable pricing supplement. Unless
otherwise specified in the applicable pricing supplement, any Allstate Life(R)
CoreNotes(R) sold to the Purchasing Agent as principal will be purchased by the
Purchasing Agent at a price equal to 100% of the principal amount thereof less a
percentage of the principal amount equal to the commission applicable to an
agency sale of a note of identical maturity. Unless otherwise specified in the
applicable pricing supplement, each trust will pay a commission to the
Purchasing Agent, ranging from .125% to 2.50% of the principal amount of the
applicable Allstate Life(R) CoreNotes(R), depending upon the stated maturity,
for all Allstate Life(R) CoreNotes(R) purchased from the issuing trust by the
Purchasing Agent as its agent.
The date of this prospectus is -, 2006.
"Allstate Life(R)" is a registered service mark of Allstate Insurance Company.
"CoreNotes(R)" is a registered service mark of Merrill Lynch & Co., Inc.
FORWARD-LOOKING STATEMENTS
Allstate Life
This prospectus, the applicable accompanying prospectus supplement and each
applicable pricing supplement may include forward-looking statements of Allstate
Life. These forward-looking statements are not statements of historical fact but
rather reflect Allstate Life's current expectations, estimates and predictions
about future results and events. These statements may use words such as "will,"
"should," "likely," "target," "anticipate," "believe," "estimate," "expect,"
"intend," "predict," "project" and similar expressions as they relate to
Allstate Life or its management. When Allstate Life makes forward-looking
statements, Allstate Life is basing them on its management's beliefs and
assumptions, using information currently available to Allstate Life. These
forward-looking statements are subject to risks, uncertainties and assumptions,
including but not limited to, risks, uncertainties and assumptions discussed in
this prospectus supplement, the accompanying prospectus and in each applicable
pricing supplement. Factors that can cause or contribute to these differences
include those described under the heading "Risk Factors" in this prospectus
supplement. Allstate Life undertakes no obligation to publicly update or revise
any forward-looking statements, whether as a result of new information, future
events, developments or otherwise.
If one or more of these or other risks or uncertainties materialize, or if
Allstate Life's underlying assumptions prove to be incorrect, actual results may
vary materially from what Allstate Life projected. Any forward-looking
statements of Allstate Life you read in this prospectus, the applicable
accompanying prospectus supplement or the applicable pricing supplement reflect
Allstate Life's current views with respect to future events and are subject to
these and other risks, uncertainties and assumptions relating to Allstate Life's
operations, results of operations, growth strategy and liquidity. All subsequent
written and oral forward-looking statements attributable to Allstate Life or
individuals acting on Allstate Life's behalf are expressly qualified in their
entirety by this section. You should specifically consider the factors
identified in this prospectus supplement, the accompanying prospectus and each
applicable pricing supplement which could cause actual results to differ before
making an investment decision.
Global Funding and the Trusts
This prospectus, the accompanying prospectus supplement and each applicable
pricing supplement may include forward-looking statements of Global Funding and
the trusts. These forward-looking statements are subject to risks, uncertainties
and assumptions, including but not limited to, risks, uncertainties and
assumptions discussed in this prospectus, the accompanying prospectus supplement
and in each applicable pricing supplement. Global Funding does not, and the
trusts will not, undertake any obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.
You should specifically consider the factors identified in this prospectus,
the accompanying prospectus supplement and each applicable pricing supplement
before making an investment decision. The trusts are not entitled to the safe
harbors contained in Section 27A of the Securities Act of 1933, as amended (the
"Securities Act") and Section 21E of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), with respect to forward-looking statements of the
trusts in this prospectus, the accompanying prospectus supplements and each
applicable pricing supplement.
1
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement filed by Global Funding
and Allstate Life (the "registrants") with the Securities and Exchange
Commission (the "SEC"). Pursuant to the registration statement, the trusts will
be offering, from time to time, up to a total amount of $5,000,000,000, or the
equivalent amount in one or more foreign currencies, in aggregate principal
amount of the notes described in this prospectus. This prospectus provides a
general description of the notes that the trusts may be offering, and additional
descriptions of the related funding notes and funding agreements. The applicable
prospectus supplement will provide additional descriptions of the secured medium
term notes or the Allstate Life(R) CoreNotes(R), as applicable, to be offered by
the trusts, and the related funding notes and funding agreements. Each time a
trust offers to sell notes, it will prepare a separate prospectus supplement to
this prospectus and the applicable prospectus supplement (a "pricing
supplement") that will set forth the specific terms of the applicable series of
notes, and the terms of the related funding note and funding agreement(s). That
pricing supplement also may add, update, supplement or clarify information in
this prospectus and the applicable prospectus supplement. Before you agree to
purchase any notes, you should read this prospectus, the applicable prospectus
supplement and the applicable pricing supplement together with the information
described under the heading "Incorporation of Documents by Reference" on page
[ ]. For more detail on the terms of the notes, you should read the exhibits
filed with or incorporated by reference in the registration statement.
You should rely on the information contained or incorporated by reference
in this prospectus, the applicable prospectus supplement and the applicable
pricing supplement. Neither the registrants nor any Agent has authorized anyone
to provide you with different or additional information. If anyone provides you
with different or additional information, you should not rely on it. Neither the
registrants nor any Agent is making an offer to sell the notes in any
jurisdiction where the offer or sale is not permitted. You should not assume
that the information contained or incorporated by reference in this prospectus,
the applicable prospectus supplement and the applicable pricing supplement is
accurate as of any date other than the date of such document.
In this prospectus, references to the "depositor" and "Global Funding" are
to Allstate Life Global Funding. References to the "trusts" are to Allstate Life
Global Funding Trusts. References to an "issuing trust" are to a trust with
respect to the series of notes issued and sold to the public by that trust.
These references are not to Allstate Life Insurance Company. In this prospectus,
references to "Allstate Life" are to Allstate Life Insurance Company.
In this prospectus, references to the "United States dollars," "U.S.
dollars" or "$" are to lawful currency of the United States of America, and
references to "Euro" are to the currency introduced at the start of the third
stage of the European Economic and Monetary Union pursuant to the Treaty
Establishing the European Community, as amended.
2
AVAILABLE INFORMATION
This prospectus, which constitutes part of the registration statement
referred to above, does not contain all of the information set forth in the
registration statement. Parts of the registration statement are omitted from
this prospectus in accordance with the rules and regulations of the SEC.
Allstate Life is subject to the informational requirements of the Exchange Act,
and, in accordance with the Exchange Act, Allstate Life files or furnishes
annual, quarterly, special event reports and other information with the SEC.
Each trust formed in connection with the offering of notes will incur
separate reporting obligations under the Exchange Act. As depositor, Global
Funding will file periodic reports with the SEC with respect to each trust
formed under the programs on Form 8-K or Form 10-D, as applicable, and will file
annual reports with respect to each trust on Form 10-K. Global Funding will also
transmit such reports to holders of each applicable series of notes in the
manner and to the extent required by the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act").
If so required by the applicable rules and regulations of the SEC, and the
interpretations and positions of the SEC staff thereunder, Global Funding will
also be filing or furnishing with the SEC all required reports on its behalf.
As part of the Allstate organization, Allstate Life does not maintain a
company-specific website. All reports and other information filed by Allstate
Life with the SEC are available over the internet at http://www.allstate.com.
(This uniform resource locator (URL) is an inactive textual reference only and
is not intended to incorporate the Allstate website into this prospectus).
Global Funding does not maintain a website. No reports will be made available on
the website of any other party as no such obligation is imposed on any such
party under the programs. You can read and copy any reports or other information
that Global Funding and Allstate Life file at the SEC's public reference room at
Room 1580, 100 F Street, N.E., Washington, D.C. 20549. You can also request
copies of such documents upon payment of a duplicating fee, by writing to the
SEC's public reference room. You can obtain information regarding the public
reference room by calling the SEC at 1-800-SEC-0330. Such filings are available
to the public from commercial document retrieval services and over the internet
at http://www.sec.gov. (This uniform resource locator (URL) is an inactive
textual reference only and is not intended to incorporate the SEC website into
this prospectus).
Pursuant to the terms of the Trust Indenture Act, the indenture trustee
will be required to transmit to holders of each series of notes reports with
respect to certain matters, including any changes to the eligibility and
qualifications, any conflicting interests, any unpaid advances made, and its
actions that materially affect the applicable notes or collateral. These reports
will not be made available on the indenture trustee's website. A copy of each
such report shall, at the time of such transmission to indenture security
holders, be filed with each stock exchange upon which the applicable note may be
listed, and also with the SEC.
INCORPORATION OF DOCUMENTS BY REFERENCE
The SEC allows Global Funding and Allstate Life to incorporate by reference
information that Global Funding and Allstate Life file with the SEC into this
prospectus and any accompanying prospectus supplement and pricing supplement,
which means that incorporated documents are considered part of this prospectus
and any accompanying prospectus supplement and pricing supplement. Global
Funding and Allstate Life can disclose important information to you by referring
you to those documents. Information that Global Funding and Allstate Life file
with the SEC will automatically update and supersede information in this
prospectus.
This prospectus and any accompanying prospectus supplement and pricing
supplement incorporate by reference:
o Allstate Life's Annual Report on Form 10-K for the fiscal year ended
December 31, 2004;
o Allstate Life's Quarterly Report on Form 10-Q for the period ended
March 31, 2005;
o Allstate Life's Quarterly Report on Form 10-Q for the period ended
June 30, 2005;
o Allstate Life's Quarterly Report on Form 10-Q for the period ended
September 30, 2005;
o Allstate Life's Current Report on Form 8-K furnished to the SEC on
February 3, 2006; and
3
o all filings made with the SEC by Global Funding as depositor with
respect to the trusts since January 1, 2005 pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act.
This prospectus and any accompanying prospectus supplement and pricing
supplement also incorporate by reference any filings made by Global Funding
(with respect to the trusts or, if required, on its behalf) or Allstate Life
with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act
subsequent to the date of this prospectus and prior to the termination of the
offering of the notes. These documents contain important information.
You may request a copy of any documents incorporated by reference in this
prospectus and any accompanying prospectus supplement and pricing supplement
(including any exhibits that are specifically incorporated by reference in
them), at no cost, by writing or telephoning to the following addresses or
telephone numbers:
Allstate Life Global Funding Allstate Life Insurance Company
c/o AMACAR Pacific Corp. 3100 Sanders Road, Suite M3A
6525 Morrison Boulevard Northbrook, Illinois 60062
Suite 318 Attention: Assistant Vice President, Institutional Markets
Charlotte, North Carolina 28211 Tel: (847) 402-5000
Attention: President
Tel: (704) 365-0569
4
DESCRIPTION OF ALLSTATE LIFE GLOBAL FUNDING AND THE TRUSTS
General
Allstate Life Global Funding is a statutory trust formed and existing under
the laws of the State of Delaware pursuant to the trust agreement, dated as of
June 24, 2002, as amended and restated by the Amended and Restated Trust
Agreement dated as of April 27, 2004, as further amended and restated by the
Amended and Restated Trust Agreement dated as of August 16, 2005, and as further
amended and restated by the Amended and Restated Trust Agreement dated as of
February -, 2006 (as the same may be further amended, supplemented, modified,
restated or replaced from time to time, the "depositor trust agreement"),
executed by Wilmington Trust Company as Delaware trustee of Global Funding,
AMACAR Pacific Corp. as administrator of Global Funding and AMACAR Pacific Corp.
as the trust beneficial owner of Global Funding, and the filing of a certificate
of trust (and amendments thereto) with the Secretary of State of the State of
Delaware. You should read the actual documents which are attached as exhibits to
the registration statement of which this prospectus forms a part.
Global Funding has not and will not engage in any activity other than:
o beneficially owning the trusts;
o issuing one or more funding notes;
o acquiring one or more funding agreements from Allstate Life;
o pledging, assigning as collateral and granting a security interest in
the applicable funding agreement(s) to the funding note indenture
trustee;
o assigning absolutely the funding agreement(s) to, and depositing such
funding agreement(s) into, the trusts; and
o engaging in other activities that are necessary, suitable or
convenient to accomplish the foregoing or are incidental to or
connected with those activities.
Global Funding is performing the functions of the depositor under the
programs for the issuance of secured medium term notes and Allstate Life(R)
CoreNotes(R) described in this prospectus and the applicable prospectus
supplements.
Each series of notes will be issued by a newly created separate and
distinct Delaware statutory trust formed by the Delaware trustee of the trust,
the administrator of the trust and Global Funding as the sole beneficial owner
of the trust pursuant to the filing of a certificate of trust and the execution
of the applicable trust agreement.
After formation, each trust will not engage in any activity other than:
o issuing and selling a single series of notes;
o immediately acquiring a funding note and immediately surrendering such
funding note for cancellation pursuant to its terms in exchange for
one or more funding agreement(s);
o acquiring, holding and maintaining the funding agreement(s);
o pledging, assigning as collateral and granting a security interest in
the applicable funding agreement(s) to the indenture trustee;
o making payments on the applicable series of notes; and
o engaging in other activities that are necessary, suitable or
convenient to accomplish the foregoing or are incidental to or
connected with those activities.
The principal executive offices of Global Funding and the trusts will be
located at c/o AMACAR Pacific Corp., 6525 Morrison Boulevard, Suite 318,
Charlotte, North Carolina 28211. The telephone number is (704) 365-0569.
5
Unless otherwise provided in the applicable pricing supplement, the fiscal
year for each trust will end on December 31. The fiscal year for Global Funding
will end on December 31.
Assets and Obligations of Global Funding; Distributions
The only equity contribution to Global Funding is $1,000 invested in Global
Funding by its trust beneficial owner. Each trust will use the net proceeds
received from the issuance of the related series of notes to purchase a funding
note from Global Funding. Global Funding will use the net proceeds received from
the sale of the related funding note to purchase one or more funding agreements
issued by Allstate Life. Pursuant to each funding note indenture, Global Funding
will immediately pledge and collaterally assign each such funding agreement to
and grant a security interest in each such funding agreement and the related
collateral in favor of the funding note indenture trustee. Global Funding will
immediately thereafter assign absolutely to, and deposit into, the applicable
trust each such funding agreement and, in connection with such assignment and
deposit, the relevant funding note will be surrendered for cancellation by or on
behalf of the applicable trust, and will be cancelled by the funding note
indenture trustee, and the pledge and collateral assignment of each funding
agreement to, and the security interest in favor of, the funding note indenture
trustee will be terminated. Such cancellation shall operate as a redemption and
satisfaction of the funding note. Global Funding will be the sole beneficial
owner of each trust that is formed.
Prior to the issue date of each funding note, the Delaware trustee shall
establish the related payment account for Global Funding. The Delaware trustee
and any agent of the Delaware trustee shall have exclusive control and sole
right of withdrawal with respect to each payment account for the purpose of
making deposits in and withdrawals from such payment account in accordance with
the depositor trust agreement. Subject to each funding note indenture, all funds
or other property received by the Delaware trustee on behalf of Global Funding
in respect of any collateral for the applicable funding note will be deposited
in the related payment account. All funds and other property deposited or held
from time to time in a payment account for Global Funding shall be held by the
Delaware trustee in such payment account for the exclusive benefit of the trust
beneficial owner, subject to the security interest in the applicable collateral
in favor of the applicable funding note indenture trustee for the benefit of the
holder of the applicable funding note and any other person for whose benefit
such funding note indenture trustee is or will be holding such collateral, and
for distribution by the Delaware trustee as provided in the depositor trust
agreement, including (and subject to) any priority of payments provided for in
the depositor trust agreement.
All funds and other property deposited into a payment account of Global
Funding shall be distributed by Global Funding as follows:
First: to the applicable funding note indenture trustee, for the payment of
all amounts then due and unpaid upon the applicable funding note and any
other amounts due and payable in accordance with the applicable funding
note indenture; and
Second: upon the final surrender of the applicable funding note and payment
of any amounts payable in respect thereof, any remaining funds and other
property deposited into such payment account shall be distributed to
Delaware trustee of Global Funding for distribution as provided below.
Notwithstanding anything in the depositor trust agreement to the contrary,
the Delaware trustee, on behalf of Global Funding, shall execute a standing
order to each funding note indenture trustee pursuant to which such funding note
indenture trustee, either directly or through an applicable funding note paying
agent, shall distribute all applicable amounts due and unpaid in accordance with
the provisions discussed above; provided, however, that all payments to be made
by Global Funding in connection with the termination of Global Funding as
provided below shall be made by the Delaware trustee on behalf of Global
Funding. For so long as (i) the Delaware trustee, on behalf of Global Funding,
has not rescinded the applicable standing order and (ii) the applicable funding
note indenture trustee, either directly or through an applicable funding note
paying agent, is able to, and does, comply with such standing order, the
Delaware trustee will not be required to establish a separate payment account in
accordance with the provisions discussed above in respect of the applicable
funding note; provided, however, that the Delaware trustee shall establish a
separate payment account to facilitate payments to be made in connection with
the termination of Global Funding as provided below.
6
In connection with the termination of Global Funding and the distribution
of all amounts from each payment account in accordance with the priority
described above, the Delaware trustee will distribute any amounts received in
accordance with the second clause of the second preceding paragraph and any
other remaining assets of Global Funding in the following order of priority:
First: to pay all expenses and other liabilities owed by Global Funding;
and
Second: any remaining funds and other property shall be paid to its trust
beneficial owner.
The Delaware trustee shall deposit in the applicable payment account of
Global Funding, promptly upon receipt, any payments received in respect of any
related collateral. Amounts held in any payment account shall not be invested by
the Delaware trustee.
AMACAR Pacific Corp., as trust beneficial owner of Global Funding, will be
entitled to receive any residual assets of Global Funding upon its liquidation
and dissolution.
Assets and Obligations of the Trusts; Distributions
The notes of a series will represent the unconditional, direct,
non-recourse and unsubordinated obligations of the issuing trust only, will not
represent the obligations of, or interest in, any other trust, Global Funding,
Allstate Life or any of their respective affiliates and will rank equally among
themselves. Each series of notes will be secured by and payable solely out of
the assets of the issuing trust, and holders of such series of notes will have
no right against the assets of Global Funding or the assets of any other trust.
Any funding agreement and any other collateral securing the repayment of the
obligations under such series of notes will be the assets of the issuing trust
and will not be the assets of Global Funding or the assets of any other trust.
The sole liability of each trust shall be its series of notes and the sole asset
of the trust will be the applicable funding agreement(s).
On the original issue date of a series of notes, the Delaware trustee shall
establish the payment account for the issuing trust. The Delaware trustee and
any agent of the Delaware trustee shall have exclusive control and sole right of
withdrawal with respect to such payment account for the purpose of making
deposits in and withdrawals from the payment account in accordance with the
applicable trust agreement and the applicable indenture. Subject to the
applicable indenture, all funds or other property received by the Delaware
trustee on behalf of the applicable trust in respect of the applicable
collateral will be deposited in the payment account of the issuing trust. All
funds and other property deposited or held from time to time in the payment
account shall be held by the Delaware trustee in the payment account for the
exclusive benefit of Global Funding, as the trust beneficial owner, subject to
the security interest in the applicable collateral in favor of the indenture
trustee for the benefit of the holders of the applicable series of notes and any
other person for whose benefit the indenture trustee is or will be holding the
applicable collateral, and for distribution by the Delaware trustee as provided
in the applicable trust agreement, including (and subject to) any priority of
payments provided for in the applicable trust agreement.
All funds and other property received by the Delaware trustee on behalf of
the issuing trust in respect of the applicable collateral will be deposited into
the payment account of such trust and will be distributed by such trust as
follows:
First: to the indenture trustee for the payment of all amounts then due and
unpaid upon the applicable series of notes and any other amounts due and
payable, in accordance with the applicable indenture; and
Second: upon the final redemption of the applicable series of notes and
payment of any amounts payable in respect thereof, any remaining funds and
other property deposited into the payment account shall be distributed to
the Delaware trustee for distribution as provided below.
Notwithstanding anything in the trust agreement for an issuing trust to the
contrary, the Delaware trustee, on behalf of the trust, shall execute a standing
order to the indenture trustee pursuant to which the indenture trustee, either
directly or through a paying agent, shall distribute all amounts due and unpaid
in accordance with the provisions discussed above; provided, however, that all
payments to be made by the trust in connection with the termination of the trust
as provided below shall be made by the Delaware trustee on behalf of the trust.
For so long as (i) the Delaware trustee, on behalf of the trust, has not
rescinded the standing order and (ii) the indenture trustee, either directly or
through a paying agent, is able to, and does, comply with the standing order,
the Delaware trustee will not be required to establish a separate payment
account in accordance with the provisions discussed above in respect of the
applicable series of notes; provided, however, that the
7
Delaware trustee shall establish a separate payment account to facilitate
payments made in connection with the termination of the trust as provided below.
In connection with the termination of any trust that is formed and the
distribution of all amounts from the applicable payment account in accordance
with the priority described above, the Delaware trustee will distribute any
amounts received in accordance with the second clause of the second preceding
paragraph and any other remaining assets of the trust in the following order of
priority:
First: to pay all expenses and other liabilities owed by the applicable
trust; and
Second: any remaining funds and other property shall be paid to its trust
beneficial owner.
The Delaware trustee shall deposit in the applicable payment account of the
trust, promptly upon receipt, any payments received with respect to the
applicable collateral. Amounts held in the applicable payment account shall not
be invested by the Delaware trustee.
Global Funding, as trust beneficial owner of each trust that is formed,
will be entitled to receive any residual assets of such trust upon their
liquidation and dissolution.
Bankruptcy Concerns
In each trust agreement, the Delaware trustee, the administrator and the
trust beneficial owner will agree that none of the parties will institute
against the applicable trust any bankruptcy proceeding. Furthermore, in the
depositor trust agreement, the parties will agree that none of them will
institute any bankruptcy proceedings against Global Funding. Also, in each
indenture, the indenture trustee will agree that it will not institute against
the applicable trust or Global Funding any bankruptcy proceeding for payments
due the indenture trustee. However, during an Event of Default under a series of
notes, the indenture trustee (on behalf of the holders of notes of the
applicable series) or the holders of such notes may accelerate payments of
principal and interest under the notes as well as attempt to institute
bankruptcy proceedings against the applicable trust. If a bankruptcy proceeding
is commenced against any trust, Allstate Life and Global Funding do not
anticipate that the assets of such trust will be consolidated with the assets of
any other party. As the sole asset of each trust will be funding agreement(s)
issued by Allstate Life, upon a proceeding for Allstate Life's liquidation,
rehabilitation, conservation or supervision or similar event, an Event of
Default under the notes issued by each trust will occur and the indenture
trustee on behalf of the holders of each series of notes will have a claim
against Allstate Life in such proceeding. No other creditors or policyholders of
Allstate Life or Global Funding should have a claim against the funding
agreement(s) held by each trust or any claims thereunder.
Delaware Trustee of Global Funding and the Trusts
General
Wilmington Trust Company has served as trustee in connection with numerous
registered and unregistered transactions involving the securitization of funding
agreements since 1996.
Allstate Life Global Funding Trusts
Pursuant to each trust agreement, the Delaware trustee will be the sole
trustee of the applicable trust. The Delaware trustee will manage the business
and affairs of each trust in accordance with the Delaware Statutory Trust Act;
provided, however, that the Delaware trustee will undertake to perform only such
duties as are specifically set forth in the applicable trust agreement and as it
may be directed from time to time by the administrator, the trust beneficial
owner and the indenture trustee in accordance with the terms of the applicable
trust agreement and the applicable indenture.
Under each trust agreement, it shall be the duty of the Delaware trustee to
discharge, or cause to be discharged, all of its responsibilities pursuant to
the terms of the applicable trust agreement, or any other documents or
instruments to which it will be a party, and to administer the issuing trust, in
accordance with the provisions of the applicable trust agreement and the other
program documents and any other documents or instruments to which the issuing
trust will be a party. Notwithstanding the foregoing, the Delaware trustee shall
be deemed to have discharged its duties and responsibilities under the
applicable trust agreement and any other documents or instruments to which the
issuing trust is a party to the extent (a) such duties and responsibilities
shall have been performed by the administrator and (b) the administrator is
required or permitted under the
8
applicable trust agreement, under the administrative services agreement or under
any other documents or instruments to which the issuing trust is a party, to
perform such act or discharge such duty of the Delaware trustee or the issuing
trust; provided, however, that the Delaware trustee shall not be held liable for
the default or failure of the administrator to carry out its required
obligations under the trust agreement or thereunder but only to the extent such
obligations are not also required to be carried out by the Delaware trustee.
Under each trust agreement, among other items, the Delaware trustee, on
behalf of the issuing trust, will have the power and authority to:
o execute and deliver on behalf of the issuing trust the notes in
accordance with the applicable trust agreement and the applicable
indenture;
o cause the issuing trust to perform the applicable trust agreement and
to enter into, and to execute, deliver and perform on behalf of the
issuing trust, the documents contained in the series instrument and
the closing instrument for the applicable series of notes, the
distribution agreement, the applicable notes, each applicable funding
agreement and such other certificates, other documents or agreements
as may be necessary, contemplated by or desirable in connection with
the purposes and function of the issuing trust or any of the
above-referenced documents;
o subject to the applicable provisions of the relevant indenture,
receive and maintain custody of each applicable funding agreement and
exercise all of the rights, powers and privileges of an owner or
policyholder of each applicable funding agreement;
o grant to the indenture trustee a security interest in the collateral
for the applicable series of notes and pledge and collaterally assign
the rights, title and interest of the applicable trust in such
collateral to the indenture trustee for the benefit of the holders of
notes of the applicable series and any other person for whose benefit
the indenture trustee is or will be holding the collateral, and seek
release of such security interest upon payment in full of all amounts
required to be paid with respect to the applicable series of notes
pursuant to the terms and conditions of such notes and the applicable
indenture;
o establish the payment account for the applicable trust;
o send notices regarding the applicable notes and the applicable funding
agreement(s) to Allstate Life, the indenture trustee, the rating
agencies, the trust beneficial owner, the applicable agents and any
other person entitled thereto in accordance with the terms of the
applicable notes, the indenture, each applicable funding agreement and
the applicable trust agreement;
o take all actions necessary or appropriate to enable the applicable
trust to comply with the provisions of the trust agreement regarding
income tax treatment;
o after the occurrence of an event of default under the applicable
funding agreement(s) actually known to a responsible officer of the
Delaware trustee, subject to the applicable provisions of the relevant
indenture, take any action as it may from time to time determine
(based solely upon the advice of counsel) is necessary or advisable to
give effect to the terms of the trust agreement and to protect and
conserve the applicable collateral for the benefit of the holders of
the applicable series of notes and any other person for whose benefit
the indenture trustee is or will be holding the collateral and, within
five business days after the occurrence of an event of default under
the applicable funding agreement(s) actually known to a responsible
officer of the Delaware trustee, give notice thereof to the
administrator, the trust beneficial owner and the indenture trustee;
o to the extent permitted by the applicable trust agreement, to
participate in the winding up of the affairs of and liquidation of the
applicable trust and assist with the preparation, execution and filing
of a certificate of cancellation with the Secretary of State of the
State of Delaware;
o subject to the applicable provisions of the applicable indenture, to
take any action and to execute any documents on behalf of the
applicable trust, incidental to the foregoing as the Delaware trustee
may from time to time determine (based on the advice of counsel) is
necessary or advisable to give effect to the terms of the applicable
trust agreement;
9
o execute and file documents with the Secretary of State of the State of
Delaware; and
o accept service of process on behalf of the issuing trust in the State
of Delaware.
Under each trust agreement, the Delaware trustee shall, based on the advice
of counsel, defend against all claims and demands of all persons at any time
claiming any lien on any of the assets of the applicable trust adverse to the
interest of the applicable trust or any holder of the applicable series of
notes, other than the security interest in the collateral granted in favor of
the indenture trustee for the benefit of each holder of the applicable series of
notes and any other person for whose benefit the indenture trustee is or will be
holding the collateral.
With respect to any trust, the Delaware trustee will not be liable under
the applicable trust agreement under any circumstances, except for (i) its own
willful misconduct, bad faith or gross negligence; (ii) its failure to use
ordinary care to disburse funds or (iii) the inaccuracy of any representation or
warranty contained in the applicable trust agreement made by the Delaware
trustee.
The Delaware trustee may resign as Delaware trustee, or the administrator,
acting on behalf of the applicable trust, may, in its sole discretion, remove
the Delaware trustee, in each case upon not less than thirty (30) days' prior
notice to the Delaware trustee, the indenture trustee and each rating agency
then rating the programs or the applicable series of notes. Upon any resignation
or removal of the Delaware trustee, the administrator, acting on behalf of the
applicable trust, shall appoint a successor Delaware trustee. If at any time the
Delaware trustee shall cease to be eligible to serve as trustee under the
applicable trust agreement and shall have not resigned, or if at any time the
Delaware trustee shall become incapable of acting or shall be adjudged bankrupt
or insolvent, or a receiver for the Delaware trustee or for its property shall
be appointed, or any public officer shall take charge or control of the Delaware
trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the administrator may remove the Delaware
trustee.
Any resignation or removal of the Delaware trustee and appointment of a
successor Delaware trustee pursuant to any of the provisions of the applicable
trust agreement shall not become effective until all fees and expenses,
including any indemnity payments, due to the outgoing Delaware trustee have been
paid and until acceptance of appointment by the successor Delaware trustee
pursuant to the applicable trust agreement.
Global Funding
Pursuant to the depositor trust agreement, the Delaware trustee will be the
sole trustee of Global Funding. The Delaware trustee will manage the business
and affairs of Global Funding in accordance with the Delaware Statutory Trust
Act; provided, however, that the Delaware trustee will undertake to perform only
such duties as are specifically set forth in the depositor trust agreement and
as it may be directed from time to time by the administrator or the applicable
trust beneficial owner in accordance with the terms of the depositor trust
agreement.
Under the depositor trust agreement, it shall be the duty of the Delaware
trustee to discharge, or cause to be discharged, all of its responsibilities
pursuant to the terms of the depositor trust agreement, or any other documents
or instruments to which it will be a party, and to administer Global Funding, in
accordance with the provisions of the depositor trust agreement and the other
program documents and any other documents or instruments to which Global Funding
will be a party. Notwithstanding the foregoing, the Delaware trustee shall be
deemed to have discharged its duties and responsibilities under the depositor
trust agreement and any other documents or instruments to which Global Funding
is a party to the extent (a) such duties and responsibilities shall have been
performed by the administrator and (b) the administrator is required or
permitted under the depositor trust agreement, under the depositor
administrative services agreement or under any other documents or instruments to
which Global Funding is a party, to perform such act or discharge such duty of
the Delaware trustee or Global Funding; provided, however, that the Delaware
trustee shall not be held liable for the default or failure of the administrator
to carry out its required obligations under the depositor trust agreement or
thereunder but only to the extent such obligations are not also required to be
carried out by the Delaware trustee.
Under the depositor trust agreement, among other items, the Delaware
trustee, on behalf of the issuing trust, will have the power and authority to:
o execute and deliver on behalf of Global Funding the funding notes and
the amended and restated certificate of trust in accordance with the
depositor trust agreement;
10
o cause Global Funding to perform the depositor trust agreement and to
enter into, and to execute, deliver and perform, the funding notes,
each series instrument and each closing instrument (including all
relevant documents contained in each series instrument and each
closing instrument), the distribution agreement, the depositor name
licensing agreement, the depositor support agreement, the depositor
administrative services agreement, each other program document and
such other certificates, other documents or agreements as may be
necessary, contemplated by or desirable in connection with the
purposes and function of Global Funding or any of the above-referenced
documents;
o receive custody of any funding agreement and exercise on behalf of
Global Funding all of the rights, powers and privileges of an owner or
policyholder of each such funding agreement in accordance with the
terms of such funding agreement and any related documents;
o cause Global Funding to immediately pledge and collaterally assign
each funding agreement to the funding note indenture trustee and to
immediately thereafter assign absolutely to, and deposit into, the
relevant trust the relevant funding agreement(s);
o establish each payment account for Global Funding and a separate
payment account to facilitate payments to the trust beneficial owner;
o send any notices regarding any funding note to Allstate Life, the
rating agencies, the trust beneficial owner of Global Funding and the
applicable agents under the relevant terms agreement in accordance
with the terms of the relevant funding note and the depositor trust
agreement;
o take all actions necessary and appropriate to enable Global Funding to
comply with the provisions of the depositor trust agreement regarding
income tax treatment;
o after the occurrence of an event of default under a funding agreement
actually known to a responsible officer of the Delaware trustee, take
any action as it may from time to time determine (based solely upon
the advice of counsel) is necessary or advisable to give effect to the
terms of the depositor trust agreement (without consideration of the
effect of any such action on any particular trust) and, within five
business days after the occurrence of an event of default under a
funding agreement actually known to a responsible officer of the
Delaware trustee, give notice thereof to the administrator and the
trust beneficial owner;
o to the extent permitted by the depositor trust agreement, to
participate in the winding up of the affairs of and liquidation of
Global Funding and assist with the preparation, execution and filing
of a certificate of cancellation with the Secretary of State of the
State of Delaware;
o to take any action and to execute any documents on behalf of Global
Funding, incidental to the foregoing, as the Delaware trustee may from
time to time determine (based on the advice of counsel) is necessary
or advisable to give effect to the terms of the depositor trust
agreement;
o execute and file documents with the Secretary of State of the State of
Delaware; and
o accept service of process on behalf of Global Funding in the State of
Delaware.
Under the depositor trust agreement, the Delaware trustee shall, based on
the advice of counsel, defend against all claims and demands of all persons at
any time claiming any lien on any of the assets of Global Funding adverse to the
interest of Global Funding or any holder of the applicable funding note.
The Delaware trustee will not be liable under the depositor trust agreement
under any circumstances, except for (i) its own willful misconduct, bad faith or
gross negligence; (ii) its failure to use ordinary care to disburse funds or
(iii) the inaccuracy of any representation or warranty contained in the
applicable trust agreement made by the Delaware trustee.
The Delaware trustee may resign as Delaware trustee, or the administrator,
acting on behalf of Global Funding, may, in its sole discretion, remove the
Delaware trustee, in each case upon not less than thirty (30) days' prior notice
to the Delaware trustee, each funding note indenture trustee, each indenture
trustee and each rating agency then rating the programs or the applicable series
of notes. Upon any resignation or removal of the Delaware trustee, the
administrator, acting on behalf of the trust, shall appoint a successor Delaware
trustee. If at any time the Delaware trustee shall cease to be eligible to serve
11
as trustee under the depositor trust agreement and shall have not resigned, or
if at any time the Delaware trustee shall become incapable of acting or shall be
adjudged bankrupt or insolvent, or a receiver for the Delaware trustee or for
its property shall be appointed, or any public officer shall take charge or
control of the Delaware trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, then the administrator may remove
the Delaware trustee.
Any resignation or removal of the Delaware trustee and appointment of a
successor Delaware trustee pursuant to any of the provisions of the depositor
trust agreement shall not become effective until all fees and expenses,
including any indemnity payments, due to the outgoing Delaware trustee have been
paid and until acceptance of appointment by the successor Delaware trustee
pursuant to the depositor trust agreement.
Administrator of Global Funding and the Trusts
The Delaware trustee, on behalf of Global Funding, executed the amended and
restated administrative services agreement of Global Funding, dated as of August
16, 2005 (as amended, supplemented, modified, restated or replaced from time to
time, the "depositor administrative services agreement"), with AMACAR Pacific
Corp., in its capacity as the administrator of Global Funding. AMACAR Pacific
Corp. will also be the administrator of each trust pursuant to separate
administrative services agreements. In such capacities the administrator will be
responsible for various administrative functions relating to the business of
Global Funding and the trusts. See "Description of the Administrative Services
Agreements" for a description of the administrative functions for which AMACAR
Pacific Corp. will be responsible.
Beneficial Ownership of Global Funding and the Trusts
Global Funding is beneficially owned by AMACAR Pacific Corp. (the "trust
beneficial owner"). The trust beneficial owner's only interest in Global Funding
is the $1,000 amount invested in Global Funding prior to the issuance of any
notes or any funding notes. No other equity contribution will be made to Global
Funding by any party. The principals of the trust beneficial owner have advised
that it is ultimately owned by several individuals, none of whom are affiliated
with Allstate Life or The Allstate Corporation. The investment by the trust
beneficial owner will not be secured by the collateral relating to any series of
notes.
Global Funding will be the beneficial owner of each trust that is formed.
No equity contribution will be made to any trust by any party.
Negative Covenants of Global Funding
So long as the depositor trust agreement remains in effect, Global Funding
(and the Delaware trustee and the administrator acting on behalf of Global
Funding) shall not undertake any business, activity or transaction except as
expressly provided for or contemplated by the depositor trust agreement or by
any funding note indenture. In particular, Global Funding shall not, except as
otherwise contemplated by the depositor trust agreement or by any funding note
indenture:
o sell, transfer, exchange, assign, lease, convey or otherwise dispose
of any assets held in Global Funding, except for any funding
agreements (as of the date of the depositor trust agreement or
thereafter acquired);
o engage in any business or activity other than in connection with, or
relating to, (A) the performance of the depositor trust agreement and
the execution, delivery and performance of any documents, including
the program documents (other than the depositor trust agreement as set
forth above), relating to the funding notes and the transactions
contemplated thereby and (B) any activities, including entering into
agreements that are necessary, suitable or convenient to accomplish
the purposes of Global Funding specified under "-General";
o incur, directly or indirectly, any debt except for each funding note;
o create, incur, assume or permit any lien or other encumbrance on any
of its properties or assets owned or thereafter acquired, or any
interest therein or the proceeds thereof except for the lien created
pursuant to each funding note indenture;
o amend, modify or fail to comply with any material provision of the
depositor trust agreement, except for any amendment or modification of
the depositor trust agreement expressly permitted under the depositor
trust agreement;
12
o own any subsidiary, except for the issuing trusts, or lend or advance
any funds to, or make any investment in, any person, except in
connection with any funding notes, the depositor administrative
services agreement, the depositor support agreement and any funding
agreement;
o directly or indirectly declare or make any distribution or other
payment to, or redeem or otherwise acquire or retire for value the
interests of, the trust beneficial owner if any amount under the
funding notes or the notes is due and unpaid, or directly or
indirectly redeem or otherwise acquire or retire for value any debt
other than any funding note if any funding note remains outstanding;
o become required to register as an "investment company" under and as
such term is defined in the Investment Company Act of 1940, as amended
(the "Investment Company Act");
o enter into any transaction of merger or consolidation or liquidate or
dissolve itself (or, to the fullest extent permitted by law, suffer
any liquidation or dissolution), or acquire by purchase or otherwise
all or substantially all the business or assets of, or any stock or
other evidence of beneficial ownership of, any person, except for the
issuing trusts;
o take any action that would cause Global Funding not to be either
ignored or treated as a "grantor trust" for United States Federal
income tax purposes;
o have any employees other than the Delaware trustee, the administrator
or any other persons necessary to conduct its business and enter into
transactions contemplated under the program documents;
o have an interest in any bank account other than those accounts
required or permitted under the program documents;
o permit any affiliate, employee or officer of Allstate Life or any
agent of Allstate Life or any agent to be a trustee of Global Funding;
o issue any funding note unless (A) Global Funding has purchased or will
simultaneously purchase the relevant funding agreement(s) from
Allstate Life and (B) Global Funding will grant a security interest
in, pledge and collaterally assign the relevant funding agreement(s)
to the funding note indenture trustee and will immediately thereafter
assign absolutely to and deposit into the relevant trust the relevant
funding agreement(s); and (C) the relevant funding note will thereupon
be surrendered and cancelled by Global Funding immediately upon such
surrender, and such cancellation shall operate as a redemption and
satisfaction of the funding note;
o commingle any of its assets with assets of any of Global Funding's
affiliates, or guarantee any obligation of any of Global Funding's
affiliates;
o (A) permit the validity or effectiveness of any funding note indenture
or the security interest securing the funding note issued pursuant to
any funding note indenture to be impaired, or permit such security
interest to be amended, hypothecated, subordinated, terminated or
discharged, (B) permit any person to be released from any covenants or
obligations under any funding agreement securing any funding note,
except as expressly permitted thereunder, under the applicable funding
note indenture, the depositor trust agreement, or each applicable
funding agreement, (C) create, incur, assume, or permit any lien or
other encumbrance (other than the security interests securing the
funding notes) on any of its properties or assets (whenever acquired),
or any interest therein or the proceeds thereof, or (D) permit a lien
with respect to any collateral not to constitute a valid first
priority perfected security interest in such collateral securing the
related funding note;
o issue any funding note unless Allstate Life has affirmed in writing to
Global Funding that it has made changes to its books and records to
reflect the grant of a security interest in, and the making of an
assignment for collateral purposes of, the relevant funding
agreement(s) by Global Funding to the applicable funding note
indenture trustee in accordance with the terms of such funding
agreement(s) and the applicable funding note indenture and Global
Funding has taken such other steps as may be necessary to cause the
security interest in or assignment for all collateral purposes of, the
applicable collateral to be perfected for purposes of the Uniform
Commercial Code in effect in the State of New York (the "UCC") or
effective against its creditors and subsequent purchasers of such
collateral pursuant to insurance or other state laws; or
13
o make any deduction or withholding from any payment of principal of or
interest on any funding note (other than amounts that may be required
to be withheld or deducted from such payments under the Internal
Revenue Code of 1986, as amended (the "Code"), or any other applicable
tax law) by reason of the payment of any taxes levied or assessed upon
any portion of the related collateral except to the extent specified
in the applicable funding note indenture or the relevant funding note
certificate or supplemental funding note indenture.
Negative Covenants of the Trusts
The trust agreement of each issuing trust will provide that so long as the
trust agreement remains in effect, the trust (and the Delaware trustee and the
administrator acting on behalf of the trust) shall not undertake any business,
activity or transaction except as expressly provided for or contemplated by the
trust agreement or the applicable indenture. In particular, the issuing trust
shall not, except as otherwise contemplated by such trust agreement or the
applicable indenture:
o sell, transfer, exchange, assign, lease, convey or otherwise dispose
of any assets held in the trust (as of the date of the trust agreement
or thereafter acquired), including, without limitation, any portion of
the applicable collateral;
o engage in any business or activity other than in connection with, or
relating to, (A) the performance of the trust agreement and the
execution, delivery and performance of any documents, including the
program documents (other than the trust agreement as set forth above),
relating to the applicable series of notes and the transactions
contemplated thereby, (B) the issuance of the applicable series of
notes pursuant to the applicable indenture and (C) any activities,
including entering into agreements that are necessary, suitable or
convenient to accomplish the purposes of the trust specified therein;
o incur, directly or indirectly, any debt except for the applicable
series of notes;
o amend, modify or fail to comply with any material provision of the
trust agreement, except for any amendment or modification of the trust
agreement expressly permitted under the trust agreement or under the
applicable indenture or the relevant funding agreement(s);
o own any subsidiary or lend or advance any funds to, or make any
investment in, any person, except for an investment in the applicable
funding agreement(s), the applicable funding note or the investment of
any funds of the trust held by the indenture trustee, a paying agent,
the registrar, the Delaware trustee or the administrator as provided
in (or in the documents or agreements contained in) the applicable
series instrument or the applicable closing instrument, or in any
applicable funding agreement;
o directly or indirectly declare or pay a distribution or make any
distribution or other payment, or redeem or otherwise acquire or
retire for value any securities other than the applicable series of
notes, provided that the trust may declare or pay a distribution or
make any distribution or other payment to the trust beneficial owner
in compliance with the trust agreement if the trust has paid or made
provision for the payment of all amounts due to be paid on the
applicable series of notes, and pay all of its debt, liabilities,
obligations and expenses, the payment of which is provided for under
the applicable support agreement;
o become required to register as an "investment company" under and as
such term is defined in the Investment Company Act;
o enter into any transaction of merger or consolidation or liquidate or
dissolve itself (or, to the fullest extent permitted by law, suffer
any liquidation or dissolution), or acquire by purchase or otherwise
all or substantially all the business or assets of, or any stock or
other evidence of beneficial ownership of, any person;
o take any action that would cause the trust not to be either ignored or
treated as a "grantor trust" for United States Federal income tax
purposes;
o have any employees other than the Delaware trustee, the administrator
or any other persons necessary to conduct its business and enter into
transactions contemplated under the program documents;
14
o have an interest in any bank account other than (A) those accounts
contemplated by the program documents, and (B) those accounts
expressly permitted by the indenture trustee; provided that any such
further account or such interest of the trust therein shall be charged
or otherwise secured in favor of the indenture trustee on terms
acceptable to the indenture trustee;
o permit any affiliate, employee or officer of Allstate Life or any
agent of Allstate Life or Agent to be a trustee of the trust;
o issue the applicable series of notes unless Allstate Life has affirmed
in writing to the trust that it has made changes to its books and
records to reflect the grant of a security interest in, and the making
of an assignment for collateral purposes of, the relevant funding
agreement(s) by the trust to the indenture trustee in accordance with
the terms of such funding agreement(s) and the trust has taken such
other steps as may be necessary to cause the security interest in or
assignment for all collateral purposes of, the collateral to be
perfected for purposes of the UCC or effective against its creditors
and subsequent purchasers of the collateral pursuant to insurance or
other state laws;
o make any deduction or withholding from any payment of principal of or
interest on the notes (other than amounts that may be required to be
withheld or deducted from such payments under the Code or any other
applicable tax law) by reason of the payment of any taxes levied or
assessed upon any portion of the collateral except to the extent
specified in the applicable indenture or a note certificate or
supplemental indenture;
o commingle any of its assets with assets of any of the trust's
affiliates, or guarantee any obligation of any of the trust's
affiliates; or
o (A) permit the validity or effectiveness of the applicable indenture
or the security interest securing the applicable series of notes to be
impaired, or permit such security interest to be amended,
hypothecated, subordinated, terminated or discharged, (B) permit any
person to be released from any covenants or obligations under any
funding agreement securing the applicable series of notes, except as
expressly permitted thereunder, under the applicable indenture, the
applicable trust agreement, or each applicable funding agreement, (C)
create, incur, assume, or permit any lien or other encumbrance (other
than the security interest securing the applicable series of notes) on
any of its properties or assets, or any interest therein or the
proceeds thereof, or (D) permit a lien with respect to the applicable
collateral not to constitute a valid first priority perfected security
interest in the collateral securing the applicable series of notes.
Amendments of Depositor Trust Agreement
The depositor trust agreement may be amended from time to time by the
parties thereto by a written instrument executed by each of the parties, in any
way that is not inconsistent with the intent of the depositor trust agreement,
including, without limitation to: (i) cure any ambiguity, (ii) correct,
supplement or modify any provision of the depositor trust agreement that is
inconsistent with another provision of the depositor trust agreement or (iii)
modify, eliminate or add to any provisions of the depositor trust agreement to
the extent necessary to ensure that Global Funding will, at all times, for
United States Federal income tax purposes be either ignored or treated as a
"grantor trust" or to ensure that Global Funding will not be required to
register as an "investment company" under the Investment Company Act and no such
amendment shall require the consent of any other person, except to the extent
specified in the second and third paragraphs below.
So long as any funding note remains outstanding, except as provided in the
two paragraphs immediately following below, any amendment to the depositor trust
agreement that would adversely affect, in any material respect, the terms of any
funding note, other then any amendment of the type contemplated by clause (iii)
of the immediately preceding paragraph, shall require the prior consent of the
holders or holders of a majority of the outstanding principal amount of funding
notes.
So long as any funding note remains outstanding, the depositor trust
agreement may not be amended to (i) change the amount or timing of any payment
of any funding note or (ii) impair the right of the applicable trust to
institute suit for the enforcement of any right for principal and interest or
other distribution without the consent of each affected holder.
The Delaware trustee shall not be required to enter into any amendment to
the depositor trust agreement which adversely affects its own rights, duties or
immunities under the depositor trust agreement.
15
Amendments of Trust Agreements
The trust agreement of each issuing trust will provide that the trust
agreement may be amended from time to time by the Delaware trustee and the
administrator by a written instrument executed by the Delaware trustee and the
administrator, in any way that is not inconsistent with the intent of the trust
agreement, including, without limitation to: (i) cure any ambiguity, (ii)
correct, supplement or modify any provision of the trust agreement that is
inconsistent with another provision of the trust agreement or (iii) modify,
eliminate or add to any provisions of the trust agreement to the extent
necessary to ensure that the trust will, at all times, for United States Federal
income tax purposes be either ignored or treated as a grantor trust or to ensure
that the trust will not be required to register as an investment company under
the Investment Company Act and no such amendment shall require the consent of
any other person, except to the extent specified in the second and third
paragraphs below.
So long as any notes of the applicable series remain outstanding, except as
provided in the two paragraphs immediately following below, any amendment to the
applicable trust agreement that would adversely affect, in any material respect,
the terms of any notes of such series, other than any amendment of the type
contemplated by clause (iii) of the immediately preceding paragraph, shall
require the prior consent of the holders of a majority of the outstanding
principal amount of the notes of the applicable series.
So long as any notes of the applicable series remain outstanding, the
applicable trust agreement may not be amended to (i) change the amount or timing
of any payment of any notes of the applicable series or (ii) impair the right of
any holder thereof to institute suit for the enforcement of any right for
principal and interest or other distribution, in each case without the consent
of each affected holder.
The Delaware trustee shall not be required to enter into any amendment to
any trust agreement which adversely affects its own rights, duties or immunities
under the applicable trust agreement.
Relationships among Global Funding, the Trusts, Allstate Life and Allstate
Insurance Company
The following describes the relationships among Global Funding, the trusts,
Allstate Life and Allstate Insurance Company:
o pursuant to an amended and restated name licensing agreement, dated as
of February -, 2006, Allstate Insurance Company has granted Global
Funding, and in connection with any issuance and sale of notes,
pursuant to a separate name licensing agreement Allstate Insurance
Company will grant the issuing trust, a non-exclusive license to use
the name "Allstate" and other licensed marks as provided therein;
o Allstate Life and Global Funding entered into an amended and restated
support and expenses agreement dated as of February -, 2006, pursuant
to which Allstate Life agreed, among other things, to pay certain
costs and expenses relating to the offering, sale and issuance of each
funding note and certain costs, expenses and taxes incurred by Global
Funding, and to indemnify Global Funding with respect to certain
matters;
o in connection with the issuance of a series of notes, pursuant to a
separate support and expenses agreement, Allstate Life will agree,
among other things, to pay certain costs and expenses relating to the
offering, sale and issuance of the applicable series of notes and
certain costs, expenses and taxes incurred by the issuing trust, and
to indemnify the issuing trust with respect to certain matters; and
o Allstate Life, Global Funding and the applicable issuing trust will
enter into the documents contemplated by the medium term note program
or the Allstate Life(R) CoreNotes(R) program in connection with the
issue and sale of each series of notes.
Except as set forth above, none of The Allstate Corporation, Allstate
Insurance Company, Allstate Life or any of their respective officers, directors,
subsidiaries or affiliates owns or will own any beneficial interest in Global
Funding or any trust nor has any of these persons or entities entered or will
enter into any agreement with Global Funding or any trust.
No trust will be affiliated with Allstate Life.
Neither The Allstate Corporation, Allstate Insurance Company, Allstate Life
nor any of their respective officers, directors, subsidiaries or affiliates
owns, or will own, any beneficial interest in the depositor or the trusts.
16
Neither The Allstate Corporation, Allstate Life nor any of their respective
officers, directors, subsidiaries or affiliates is affiliated with the Delaware
trustee, the trust beneficial owner or the administrator of any trust or Global
Funding, any indenture trustee or any funding note indenture trustee. Neither
The Allstate Corporation, Allstate Insurance Company, Allstate Life nor any of
their respective officers, directors, subsidiaries or affiliates is affiliated
with any beneficial owner of AMACAR Pacific Corp.
Costs and Expenses of Global Funding and the Trusts
Costs and expenses of Global Funding and each trust shall be paid by
Allstate Life pursuant to the applicable support agreement to the extent
provided therein. See "Description of Support and Expenses Agreements."
Records and Financial Statements of Global Funding and the Trusts
Each trust will:
o maintain separate and distinct records; and
o hold and account for its assets separately from the assets of Global
Funding and the assets of the other trusts.
17
DESCRIPTION OF ALLSTATE LIFE INSURANCE COMPANY
Allstate Life Insurance Company is the sponsor of the programs. Allstate
Life was organized in 1957 as a stock life insurance company under the laws of
the State of Illinois. It conducts substantially all of its life insurance
operations directly or through wholly owned United States subsidiaries. It is a
wholly owned subsidiary of Allstate Insurance Company ("AIC"), a stock
property-liability insurance company organized under the laws of the State of
Illinois. All of the outstanding stock of AIC is owned by The Allstate
Corporation, a publicly owned holding company incorporated under the laws of the
State of Delaware.
The Allstate Corporation, together with its subsidiaries, is the second
largest personal property and casualty insurer in the United States on the basis
of 2004 statutory premiums earned. Widely known through the "You're In Good
Hands With Allstate(R)" slogan, The Allstate Corporation, through its
subsidiaries, provides insurance products to approximately 17 million households
and has approximately 14,100 exclusive agencies and financial specialists in the
United States and Canada.
Allstate Life sells life insurance, retirement and investment products to
individual and institutional customers through several distribution channels.
The principal individual products are deferred and immediate fixed annuities,
variable annuities, interest-sensitive and traditional life insurance, and
accident and health insurance. The principal institutional product is funding
agreements backing medium-term notes.
Allstate Life distributes its products to individuals through multiple
intermediary distribution channels, including Allstate exclusive agencies,
independent agents (primarily master brokerage agencies), banks, broker-dealers,
and specialized structured settlement brokers. Allstate Life sells funding
agreements to unaffiliated trusts used to back medium-term notes issued to
institutional and individual investors.
As of December 31, 2004 and December 31, 2003, respectively, Allstate
Life's total invested assets in its general account were $69.69 billion and
$59.99 billion, and its separate accounts' assets were $14.38 billion and $13.43
billion, respectively. Net income for the years ended December 31, 2004 and 2003
was $181 million and $278 million, respectively.
Since 1999, Allstate Life has participated in five securitization programs
for the issuance of medium term notes secured by funding agreements. The first
program in which Allstate Life participated was a securitization program under
which notes were offered in private placement transactions by a Cayman Islands
limited liability company only to foreign investors, in reliance on Regulation S
under the Securities Act. Under this program, in connection with each offering
of notes, Allstate Life sells a funding agreement to the issuing entity, which
uses the proceeds of the note issuance to pay for the funding agreement and
holds the funding agreement as its principal asset. The notes are secured with a
lien on the funding agreement. Allstate Life makes payments under the funding
agreement which, in turn, are used by the issuing entity to pay interest and
principal when due under the applicable notes.
In September 2000, Allstate Life began participating in a securitization
program (the "GMTN I program") under which a Delaware limited liability company
issued funding agreement-backed medium term notes in private placement
transactions to both "qualified institutional buyers" in the United States in
reliance on Rule 144A under the Securities Act, and to foreign investors. In
addition to the notes, the issuing entity also offered auction market equity
securities ("AMES"). Under the GMTN I program, the future payment stream of
Allstate Life's funding agreements was used to back the issuing entity's
obligations under both the applicable series of notes and the AMES. In addition,
the notes of each series are secured with a lien on each applicable funding
agreement.
Since August 2003, Allstate Life has been participating in an additional
global funding agreement-backed medium term note program (the "GMTN II
program"). The GMTN II structure does not include the AMES feature. Under the
GMTN II program, notes are issued by a Delaware series trust which uses the
proceeds from each offering to acquire from Allstate Life a funding agreement
with pricing terms matching those of the underlying notes. Each funding
agreement is pledged by the issuing entity to the indenture trustee to secure
the issuing entity's obligations under the relevant series of notes.
Since April 2004, Allstate Life has been participating in the programs for
the issuance of secured medium term notes (including the Allstate Life(R)
CoreNotes(R) program) described in this prospectus and the applicable prospectus
supplements.
Under all of the above described securitization programs, Allstate Life is
responsible for certain fees and expenses of, and has certain indemnification
obligations with respect to, each of the issuing entities and their respective
service
18
providers. Allstate Life also has certain indemnification obligations for
securities law liabilities to initial purchasers of notes issued under the above
described programs.
As of February 27, 2006, funding agreements having an aggregate principal
amount of $13,869,991,572 have been issued and were outstanding in connection
with the securitization programs described above.
Allstate Life is a "significant obligor" within the meaning of the
applicable SEC regulations. This prospectus and any accompanying prospectus
supplement and pricing supplement incorporate by reference the consolidated
financial statements of Allstate Life and its subsidiaries meeting the
requirements of the applicable SEC regulations for financial statements of
significant obligors.
Allstate Life's principal executive offices are located at 3100 Sanders
Road, Northbrook, Illinois 60062 and its telephone number is (847) 402-5000.
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
The following table shows the ratio of earnings to fixed charges for
Allstate Life and its subsidiaries for the periods indicated:
Nine-month
periods ended
September 30, Year Ended December 31,
------------- -----------------------
2005 2004 2004 2003 2002 2001 2000
---- ---- ---- ---- ---- ---- ----
Ratio of earnings to fixed charges(1)(2)(3) 1.2x 1.2x 1.3x 1.3x 1.2x 1.3x 1.5x
- ---------------
(1) Allstate Life has authority to issue up to 1,500,000 shares of non-voting
preferred stock, par value $100.00 per share. There are currently 49,230
shares of redeemable preferred stock issued and outstanding. Allstate Life
is obligated to pay a dividend on those preferred shares.
(2) For the purposes of this computation, earnings consist of income from
continuing operations before income taxes and the cumulative effect of
change in accounting principle plus fixed charges. Fixed charges consist of
the interest factor of annual rental expense, the dividends on redeemable
preferred securities and the interest credited to contractholder funds.
(3) Allstate Life continues to sell asset accumulation products that credit
interest to the contractholder. This results in a negative impact on the
ratio of earnings to fixed charges because the effect of increases in
interest credited to contractholders more than offsets the effect of the
increases in earnings.
USE OF PROCEEDS
In connection with the issuance and sale of each series of notes, the
issuing trust will use the net proceeds received from the offering of the
applicable series of notes to purchase a funding note from Global Funding.
Global Funding will use the proceeds received from the sale of such funding note
to purchase one or more funding agreements issued by Allstate Life. Allstate
Life intends to use the net proceeds from the sale of each funding agreement to
purchase investment assets.
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DESCRIPTION OF THE NOTES
This prospectus relates to:
o one or more series of secured medium term notes to be offered
primarily to retail investors which are referred to as Allstate
Life(R) CoreNotes(R); and
o one or more series of secured medium term notes to be offered
primarily to institutional investors, which one or more newly created
separate and distinct Delaware special purpose statutory trusts that
may be formed from time to time may offer.
Allstate Life(R) CoreNotes(R) will be offered from time to time to the
public, with payment of principal of, any premium and interest on, and any other
amounts due and owing with respect to, the Allstate Life(R) CoreNotes(R) to be
secured by one or more applicable funding agreements issued by Allstate Life and
assigned absolutely to, and deposited into, the issuing trust by Global Funding.
The terms of the secured medium term notes are identical in all material
respects to the terms of the Allstate Life(R) CoreNotes(R), except that the
secured medium term notes:
o may be issued as amortizing notes;
o may be denominated in one or more foreign currencies;
o will not contain a survivor's option, permitting optional repayment of
notes of a series, subject to certain limitations, prior to maturity,
if requested, following the death of the beneficial owner of notes of
that series; and
o may contain a provision providing for the redemption of the notes if
Allstate Life is required to pay additional amounts on the related
funding agreements pursuant to the applicable pricing supplement and
Allstate Life exercises its right to redeem the funding agreements.
The following is a general description of the terms of the notes. Specific
terms of a series of notes will be provided in the applicable pricing supplement
which will supplement this prospectus and the applicable prospectus supplement.
Notes will be issued in one or more series. The terms of each indenture (as
defined below) will not limit the amount of notes that the relevant trust may
issue. Unless otherwise specified in the applicable prospectus supplement or the
applicable pricing supplement, each series of notes will be secured by one or
more funding agreements relating to that series of notes.
Each trust may issue notes at a discount below their stated principal
amount, bearing no interest or interest at a rate that at the time of issuance
is below market rates.
None of the trusts will issue notes that may be repaid at the option of the
holders prior to the stated maturity date if such issuance would cause the
relevant trust to fail to satisfy the applicable requirements for exemption
under Rule 3a-7 under the Investment Company Act of 1940, as amended, and all
applicable rules, regulations and interpretations thereunder.
Certain federal income tax considerations and other relevant considerations
are described in the applicable prospectus supplement or pricing supplement.
The decision to issue notes to investors and purchase funding agreements or
funding notes (in the case of an issuing trust) issued by Allstate Life (or
Global Funding in the case of funding notes) rests solely with Global Funding or
the issuing trust (in the case of funding notes). Global Funding and the trusts
are under no obligation to Allstate Life or any other person or entity to issue
any notes or purchase any funding agreements.
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DESCRIPTION OF THE INDENTURES
Each series of notes will be issued by a trust pursuant to a separate
indenture (each, an "indenture") to be entered into among the issuing trust and
the other parties specified therein, including J.P. Morgan Trust Company,
National Association ("J.P. Morgan Trust Company") or another entity specified
in the applicable indenture, in its capacity as indenture trustee, (including,
in each case, any successor, the "indenture trustee"). Each indenture will be
subject to and qualified under the Trust Indenture Act. Each indenture will
adopt the standard indenture terms, which are filed as an exhibit to the
registration statement of which this prospectus is a part and are incorporated
into this prospectus by reference.
The following summary highlights some of the provisions included in the
standard indenture terms, but it may not contain all of the information that is
important to you. The standard indenture terms are not restated in their
entirety and you should read the standard indenture terms, which are attached as
an exhibit to the registration statement of which this prospectus forms a part.
Covenants
Under the applicable indenture, the issuing trust will make certain
covenants regarding payment of principal, interest (if any), premium (if any)
and other amounts (if any), maintenance of offices or agencies, holding in trust
money for note payments, protection of the collateral and delivery of an annual
statement as to compliance with conditions, performance of obligations and
adherence to covenants under the applicable indenture. Among other covenants,
the issuing trust will agree, so long as any notes of the applicable series are
outstanding, that such trust will comply with all of its covenants set forth
under "Description of Allstate Life Global Funding and the Trusts--Negative
Covenants of the Trusts".
Non-Petition
Under the applicable indenture in respect of a series of notes, the
indenture trustee, each other party to such indenture and each holder of notes
of such series will covenant and agree that, for a period of one year plus one
day after payment in full of all amounts payable under or in respect of the
applicable indenture and the notes of such series, it will not institute
against, or join any other person in instituting against, the applicable trust
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any federal or state bankruptcy or
similar law. The immediately preceding sentence shall survive any termination of
the applicable indenture.
Notwithstanding the preceding paragraph, under the applicable indenture in
respect of a series of notes, the indenture trustee and each other party to such
indenture and each holder of notes of such series will covenant and agree that
it will not institute against, or join any other person in instituting against,
the applicable trust any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings, or other proceedings under any federal or state
bankruptcy or similar law, as a result of the failure to pay fees or expenses
pursuant the applicable indenture to any party entitled thereto.
Moreover, under the applicable indenture, each of the indenture trustee and
each other party to such indenture will covenant and agree that it will not
cause an Event of Default as a result of the applicable trust's failure to pay
any fees or expenses to any party entitled thereto under such indenture.
Events of Default
The following will be "Events of Default" with respect to the notes of a
particular series issued pursuant to the applicable indenture:
o default in the payment when due and payable of the principal of, or
any premium on, any note of such series;
o default in the payment when due and payable, of any interest on, or
any additional amounts with respect to, any note of such series and
continuance of such default for a period of five business days;
o any "Event of Default" (as defined in the funding agreement) by
Allstate Life under any funding agreement securing the notes of such
series or any Event of Default (as defined in the applicable funding
note) under the applicable funding note;
o the issuing trust fails to observe or perform any covenant contained
in the notes of such series or in the applicable indenture for a
period of 30 days after the date on which written notice specifying
such failure,
21
stating that such notice is a "Notice of Default" thereunder and
demanding that the issuing trust remedy the same, will have been given
by registered or certified mail, return receipt requested, to the
issuing trust by the indenture trustee, or to the issuing trust and
the indenture trustee by the holder or holders of at least 25% in
aggregate principal amount of the outstanding notes of such series
affected thereby;
o the applicable indenture for any reason shall cease to be in full
force and effect or shall be declared null and void, or the indenture
trustee shall fail to have or maintain a validly created and first
priority perfected security interest (or the equivalent thereof) in
the collateral required to secure the notes of such series; or any
person shall successfully claim, as finally determined by a court of
competent jurisdiction, that any lien on such collateral in favor of
the indenture trustee for the benefit of the holders of the notes of
such series and any other person for whose benefit the indenture
trustee is or will be holding the applicable collateral, is void or is
junior to any other lien or that the enforcement thereof is materially
limited because of any preference, fraudulent transfer, conveyance or
similar law;
o an involuntary case or other proceeding shall be commenced against the
issuing trust seeking liquidation, reorganization or other relief with
respect to the issuing trust or its debts under any bankruptcy,
insolvency, reorganization or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver, liquidator,
custodian or other similar official of the issuing trust or any
substantial part of its property, and such involuntary case or other
proceeding shall remain undismissed and unstayed for a period of 60
days; or an order for relief shall be entered against the issuing
trust under the federal bankruptcy laws in effect at the date of the
applicable indenture or thereafter;
o the issuing trust commences a voluntary case or other proceeding
seeking liquidation, reorganization or other relief with respect to
itself or its debts under any bankruptcy, insolvency, reorganization
or other similar law or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of the
issuing trust or any substantial part of its property, or consents to
any such relief or to the appointment of or taking possession by any
such official in an involuntary case or other proceeding commenced
against it, or makes a general assignment for the benefit of
creditors, or fails generally to pay its debts as they become due, or
takes any statutory trust action to authorize any of the foregoing; or
o any other Event of Default provided in any supplemental indenture or
in a note certificate representing the notes of such series.
If one or more Events of Default shall have occurred and be continuing with
respect to the notes of such series, then, and in every such event, unless the
principal of all of the notes of such series shall have already become due and
payable, either the indenture trustee or the holder or holders of not less than
25% in aggregate principal amount of the notes of such series then outstanding
under the applicable indenture by notice in writing to the issuing trust (and to
the indenture trustee if given by such holders), may declare the entire
principal of, and premium (if any), of all the notes of such series and any
interest accrued thereon and any other amounts due and owing with respect
thereto, to be due and payable immediately, and upon any such declaration the
same shall become immediately due and payable; provided that, if any Event of
Default specified in the sixth or seventh bullets above occurs with respect to
the issuing trust, or if any Event of Default specified in the third bullet
above that would cause any funding agreement securing the notes of such series
to become immediately due and payable occurs with respect to Allstate Life, then
without any notice to the issuing trust or any other act by the indenture
trustee or any holder of any notes of such series, the entire principal of, and
premium on (if any), all the notes of such series and the interest accrued
thereon and any other amounts due and owing with respect thereto, shall become
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of which will be waived by the issuing trust under the
applicable indenture.
Notwithstanding the previous paragraph, if at any time after the principal
of the notes of such series, any interest accrued thereon and any other amounts
due or owing with respect thereto shall have been so declared due and payable
and before any judgment or decree for the payment of the funds due shall have
been obtained or entered as hereinafter provided, the issuing trust shall pay or
shall deposit with the indenture trustee a sum sufficient to pay all due and
payable interest on all the notes of such series, any interest accrued thereon
and any other amounts due or owing with respect thereto and the principal of and
premium on (if any) any and all notes of such series which shall have become due
and payable otherwise than by acceleration (with interest on such principal and,
to the extent that payment of such interest is enforceable under applicable law,
on overdue interest and any other amounts payable, at the same rate as the rate
of interest specified in the note certificates representing the notes of such
series to the date of such payment or deposit) and such amount as shall be
sufficient to cover reasonable compensation to the indenture trustee and each
predecessor indenture trustee, their respective
22
agents, attorneys and counsel, and all other expenses and liabilities incurred,
and all advances made, by the indenture trustee and each predecessor indenture
trustee except as a result of negligence or bad faith, and if any and all Events
of Default under the applicable indenture, other than the non-payment of the
principal of and premium on (if any) the notes of such series which shall have
become due by acceleration, shall have been cured, waived or otherwise remedied
as provided herein, then and in every such case the applicable holder
representative (as defined below), by written notice to the issuing trust and to
the indenture trustee, may waive all defaults and rescind and annul such
declaration and its consequences, but no such waiver or rescission and annulment
shall extend to or shall affect any subsequent default or shall impair any right
consequent thereon.
Upon the occurrence and during the continuation of an Event of Default, the
claims of the indenture trustee for its fees and expenses will have priority
over the claims of holders of notes of such series with respect to any funds
collected by the indenture trustee during such Event of Default, subject to the
terms of the applicable indenture.
Except in the circumstances described in the third bullet point above, an
Event of Default under the notes of a series will not constitute an event of
default under any related funding agreement. In the absence of a contemporaneous
event of default under any applicable funding agreement, the issuing trust will
probably not have sufficient amounts to pay fully all amounts due to the holders
of the applicable series of notes upon the occurrence of an acceleration event
with respect to such series of notes. In such a case, the indenture trustee,
acting for the benefit of the holders of the applicable series of notes, will be
limited to a proceeding against each applicable funding agreement and the
related collateral. However, because under such circumstances Allstate Life
would not be under any obligation to accelerate its payment obligations under
any such funding agreement, the indenture trustee could only:
o continue to receive scheduled periodic payments under the collateral,
including any applicable funding agreement;
o dispose of the collateral, including any applicable funding agreement,
subject to obtaining the consent of Allstate Life; or
o exercise any combination of the foregoing.
Any such disposition of collateral could be made on unfavorable terms and
result in material losses to the holders of the applicable series of notes.
In addition, in the event of any acceleration under a series of notes, the
amounts of cash received under any applicable funding agreement(s), the
applicable support agreement and any other sources available to the issuing
trust may be insufficient to enable it to satisfy all of its support obligations
and other cash obligations. The failure to have sufficient cash to meet these
obligations could result in insolvency or other circumstances that could result
in material losses to the holders of the applicable series of notes.
Application of Proceeds
Any funds collected by the indenture trustee following an Event of Default,
and during the continuance thereof, under the applicable indenture in respect of
the notes of a series shall be held in trust in the applicable collection
account and be applied in the following order at the date or dates fixed by the
indenture trustee and, in case of the distribution of such funds on account of
principal, any premium and interest and any other amounts due and owing, upon
presentation of the global security or certificates representing the notes of
such series and the notation thereon of the payment if only partially paid or
upon the surrender thereof if fully paid:
First: to the payment of costs and expenses, including reasonable
compensation to the indenture trustee and each predecessor indenture
trustee and their respective agents and attorneys and of all expenses and
liabilities incurred, and all advances made, by the indenture trustee and
each predecessor indenture trustee except as those adjudicated in a court
of competent jurisdiction to be the result of any such indenture trustee's
negligence or bad faith, in an aggregate amount of no more than $250,000
for all series of notes issued under the programs to the extent not paid
pursuant to the applicable support agreement;
Second: to the payment of principal, any premium and interest, any
additional amounts and any other amounts then due and owing on the notes of
such series, ratably, without preference or priority of any kind, according
to the aggregate amounts due and payable on such notes;
23
Third: to the payment of any other Obligations then due and owing with
respect to such series of notes, ratably, without preference or priority of
any kind; and
Fourth: to the payment of any remaining balance to the issuing trust for
distribution by the Delaware trustee in accordance with the provisions of
the applicable trust agreement.
All money deposited with the indenture trustee pursuant to an indenture in
respect of notes of a series, except when an Event of Default has occurred and
is continuing, shall be held in trust in the applicable collection account and
applied by it, in accordance with the provisions of the notes of such series and
the applicable indenture, to the payment through any paying agent, to the
persons entitled thereto, of the principal, premium, if any, interest and
additional amounts, if any, for whose payment such money has been deposited with
or received by the indenture trustee. If no Event of Default with respect to the
notes of a series has occurred and is continuing, the following priority of
payments shall apply:
First: to the payment of principal, any premium and interest, any
additional amounts, and any other amounts then due and owing on the notes
of such series, ratably, without preference or priority of any kind,
according to the aggregate amounts due and payable on such notes;
Second: to the payment of any other Obligations then due and owing with
respect to such series of notes, ratably, without preference or priority of
any kind; and
Third: to the payment of any remaining balance to the issuing trust for
distribution by the Delaware trustee in accordance with the provisions of
the applicable trust agreement.
The indenture trustee may make distributions under an indenture in cash or
in kind or, on a ratable basis, in any combination thereof.
Except as provided in the immediately following paragraph, all funds
received by the indenture trustee shall, until used or applied as provided in
the applicable indenture, be held in trust for the purposes for which they were
received. The indenture trustee (and each of its agents and affiliates) shall
deposit all cash amounts received by it (or any such agents or affiliates) that
are derived from the collateral for the benefit of the holders of the applicable
series of notes in a collection account. Neither the indenture trustee nor any
agent of the applicable trust or the indenture trustee shall be under any
liability for interest on any funds received by it under the applicable
indenture.
Any funds deposited with or paid to the indenture trustee or any paying
agent for the payment of the principal of, any interest or premium on, or any
additional amounts or any other amounts with respect to, any note of a series
and not applied but remaining unclaimed for three years after the date upon
which such principal, interest, premium, additional amounts or any other amount
shall have become due and payable, shall, upon the written request of the
applicable trust and unless otherwise required by mandatory provisions of
applicable escheat or abandoned or unclaimed property law, be repaid to the
applicable trust by the indenture trustee or such paying agent, and the holder
of any such note shall, unless otherwise required by mandatory provisions of
applicable escheat or abandoned or unclaimed property laws, thereafter look only
to the applicable trust for any payment which such holder may be entitled to
collect, and all liability of the indenture trustee or any paying agent with
respect to such funds shall thereupon cease.
Trust Certificate of Compliance
Under each indenture, the trust will furnish to the indenture trustee on or
before May 15 of each year commencing with the first May 15 following the
issuance of a funding note or any notes, a brief certificate as to its knowledge
of the trust's compliance with all conditions and covenants under the applicable
indenture (which will be determined without regard to any period of grace or
requirement of notice provided under the indenture).
Reports on Assessment of Compliance With Servicing Criteria and Compliance
Statements; Attestation Reports of Registered Public Accounting Firm
In connection with the filing of any annual report on Form 10-K of a trust
filed under the Exchange Act, each of the indenture trustee and each paying
agent (unless the indenture trustee is the only paying agent) shall (a) provide
to Allstate Life, the applicable trust and Global Funding (i) a report required
pursuant to Item 1122(a) of Regulation AB on an assessment of compliance with
the servicing criteria set forth in Item 1122(d) of Regulation AB (each a
"Compliance Report") and (ii) a statement of compliance required pursuant to
Item 1123 of Regulation AB, each of which shall be dated
24
the date of, and shall be filed as an exhibit to, the applicable annual report;
and (b) cause, at the expense of Allstate Life, a registered public accounting
firm to provide to Allstate Life, the applicable trust and Global Funding an
attestation report on the applicable Compliance Report as required pursuant to
Item 1122(b) of Regulation AB, which shall be dated the date of, and shall be
filed as an exhibit to, the applicable Annual Report.
Reports by Indenture Trustee
Within ten days following any distribution made or scheduled to be made on
the notes of a series, including any date specified in the applicable note
certificate(s) or in any supplement to the applicable indenture or the date at
which the notes of such series become due and payable, and only to the extent
the applicable trust is required to file reports under the Exchange Act, the
indenture trustee will deliver to Allstate Life and the holders of the notes of
such series a report regarding such distribution.
Within 60 days after May 15 of each year commencing with the first May 15
following the issuance of the notes of a series, if required by Section 313(a)
of the Trust Indenture Act, the indenture trustee shall transmit, pursuant to
Section 313(c) of the Trust Indenture Act, a brief report dated as of May 15
with respect to any of the events specified in Section 313(a) of the Trust
Indenture Act which may have occurred since the later of the immediately
preceding May 15 and the date of the applicable indenture. The indenture trustee
shall transmit the reports required by Section 313(a) of the Trust Indenture Act
at the time specified therein. The indenture trustee shall comply with Section
313(b) of the Trust Indenture Act. Such reports shall be transmitted in the
manner and to the persons required by Sections 313(c) and 313(d) of the Trust
Indenture Act. A copy of each such report shall, at the time of such
transmission to holders of the notes of such series, be filed by the indenture
trustee with each stock exchange upon which the notes of such series are listed,
with the SEC and the applicable trust. The applicable trust will notify the
indenture trustee whether the notes of such series are listed on any stock
exchange.
Reports by Trust
Pursuant to Section 314(a) of the Trust Indenture Act, each trust shall:
o file, or cause to be filed, with the indenture trustee, within 15 days
after the applicable trust or Global Funding is required to file the
same with the SEC and to the extent available to such trust, copies of
the annual reports and of the information, documents and other reports
(or copies of such portions of any of the foregoing as the SEC may
from time to time by rules and regulations prescribe) which the
applicable trust or Global Funding may be required to file with the
SEC pursuant to Section 13 or Section 15(d) of the Exchange Act; or,
if such trust is not required to file information, documents or
reports pursuant to either of said Sections, then it shall file, or
cause to be filed, with the indenture trustee and the SEC, in
accordance with rules and regulations prescribed from time to time by
the SEC, such of the supplementary and periodic information, documents
and reports which may be required pursuant to Section 13 of the
Exchange Act in respect of a security listed and registered on a
national securities exchange as may be prescribed form time to time in
such rules and regulations; provided that if, pursuant to any publicly
available interpretations of the SEC, the applicable trust or Global
Funding would not be required to make such filings under Section
314(a) of the Trust Indenture Act, then such trust or Global Funding
shall not be required to make such filings;
o file, or cause to be filed on its behalf, with the indenture trustee
and the SEC, in accordance with rules and regulations prescribed from
time to time by the SEC, such additional information, documents and
reports with respect to compliance by the applicable trust, with the
conditions and covenants of the applicable indenture as may be
required from time to time by such rules and regulations; and
o transmit within 30 days after the filing thereof with the indenture
trustee, in the manner and to the extent provided in Section 313(c) of
the Trust Indenture Act, such summaries of any information, documents
and reports required to be filed by or on behalf of the applicable
trust pursuant to the two immediately preceding paragraphs as may be
required by rules and regulations prescribed from time to time by the
SEC.
Fees and Expenses Payable Out of Cash Flows From Funding Agreements
It is expected that funding agreement(s) securing the obligations of any
issuing trust under a series of notes will constitute the sole source of
payments in respect of the notes of such series. Pursuant to each indenture, any
funds collected
25
by the indenture trustee under the applicable series of notes will be applied as
described under "--Application of Proceeds" and used in part to pay certain
costs and expenses as described in the table below:
- ---------------- ----------------- ------------------------------------ ---------------- ----------------- --------------------
Payment of Fees Party Receiving General Purpose Source of Funds Distribution Amount Payable
Fees and Priority
Expenses
- ---------------- ----------------- ------------------------------------ ---------------- ----------------- --------------------
Following Indenture Costs and expenses, including Funds First priority Actual expenses
Event of Trustee reasonable compensation of the collected by (prior to the (in an aggregate
Default indenture trustee, and each the indenture payment of any amount of no more
predecessor indenture trustee and trustee in other amounts, than $250,000 for
their respective agents and respect of the including any all series of
attorneys, and all expenses and applicable amounts due and notes issued under
liabilities incurred, and advances series of notes owing on the the programs)
made, by the indenture trustee and notes of the
each predecessor indenture applicable
trustee, excluding those resulting series)
from negligence or bad faith
- ---------------- ----------------- ------------------------------------ ---------------- ----------------- --------------------
Prior to and Indenture All costs and expenses (including Funds Third priority Actual expenses
Following Trustee attorneys' fees) incurred by the collected by (after the
Event of indenture trustee in realizing on the indenture payment of all
Default the applicable collateral trustee in amounts due and
respect of the owing under the
applicable notes of the
series of notes applicable
series)
- ---------------------------------------------------------------------------------------------------------------------------------
Certain Rights of Holders
The holder or holders of a majority in aggregate principal amount of the
notes of any series at the time outstanding shall have the right to elect a
holder representative ("holder representative") who shall have binding authority
upon all the holders and who shall direct the time, method, and place of
conducting any proceeding for any remedy available to the indenture trustee, or
exercising any trust or power conferred on the indenture trustee by the
applicable indenture, provided that:
o such direction shall not be otherwise than in accordance with law and
the provisions of the applicable indenture; and
o subject to certain limitations, the indenture trustee shall have the
right to decline to follow any such direction if the indenture
trustee, being advised by counsel, shall determine that the action or
proceeding so directed may not lawfully be taken or if the indenture
trustee in good faith by its board of directors, the executive
committee, or a trust committee of directors or responsible officers
of the indenture trustee shall determine that the action or
proceedings so directed would involve the indenture trustee in
personal liability.
Nothing in an indenture shall impair the right of the indenture trustee in
its discretion to take any action deemed proper by the indenture trustee and
which is not inconsistent with such direction by the holder or holders of notes
of the applicable series.
No holder of any note of any series shall have any right by virtue or by
availing of any provision of the applicable indenture to institute any action or
proceeding at law or in equity or in bankruptcy or otherwise upon or under or
with respect to the applicable indenture, or for the appointment of a trustee,
receiver, liquidator, custodian or other similar official or for any other
remedy under the applicable indenture, unless:
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o such holder has previously given written notice to the indenture
trustee of a continuing Event of Default with respect to such series
of notes;
o the holder or holders of notes representing not less than 25% of the
aggregate principal amount of the outstanding notes of such series
shall have made written request to the indenture trustee to institute
proceedings in respect of such Event of Default in its own name as the
indenture trustee;
o such holder or holders have offered to the indenture trustee indemnity
or security satisfactory to it against the costs, expenses and
liabilities to be incurred in compliance with such request;
o the indenture trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
o no direction inconsistent with such written request has been given to
the indenture trustee during such 60-day period by the holder or
holders of notes representing at least 66 2/3% of the aggregate
principal amount of the outstanding notes of such series;
it being understood and intended, and being expressly covenanted by each holder
of a note of the relevant series with each other holder of a note of the
relevant series and the indenture trustee, that no holder or holders of notes of
a series shall have any right in any manner whatever by virtue of, or by
availing of, any provision of the applicable indenture to affect, disturb or
prejudice the rights of any other holder of any note of the relevant series or
to obtain or to seek to obtain priority or preference over any other holder of
the relevant series to enforce any right under such indenture, except in the
manner therein provided and for the equal, ratable and common benefit of all the
holders of the notes of the relevant series. For the protection and enforcement
of the provisions described in this paragraph, each holder and the indenture
trustee shall be entitled to such relief as can be given either at law or in
equity.
Notwithstanding any other provisions in the applicable indenture, however,
the right of any holder of any note of the relevant series, which is absolute
and unconditional, to receive payment of the principal of (and premium, if any),
and interest on, if any, and additional amounts with respect to, if any, such
note of the relevant series, on or after the respective due dates expressed in
such note of the relevant series, or to institute suit for the enforcement of
any such payment on or after such respective dates, shall not be impaired or
affected without the consent of such holder.
Since Allstate Life and Global Funding are registrants, purchasers of notes
may be able to proceed directly against Allstate Life and Global Funding to
enforce their rights under the Federal securities laws and their rights under
the Federal securities laws will be no different than if they purchased the
underlying funding agreements directly from Allstate Life or the underlying
funding notes directly from Global Funding.
Modifications and Amendments
Modifications and Amendments Without Consent of Holders
The issuing trust and the indenture trustee may from time to time and at
any time enter into an indenture or indentures supplemental to the applicable
indenture for one or more of the following purposes without the consent of any
holders of the applicable series of notes:
o for the issuing trust to convey, transfer, assign, mortgage or pledge
to the indenture trustee as security for the notes of the relevant
series any property or assets;
o to add to the issuing trust's covenants such further covenants,
restrictions, conditions or provisions as the issuing trust and the
indenture trustee shall consider to be for the protection of each
holder of notes of the applicable series, and to make the occurrence,
or the occurrence and continuance, of a default in any such additional
covenants, restrictions, conditions or provisions an Event of Default
permitting the enforcement of all or any of the several remedies
provided in the relevant indenture, as described herein; provided
that, in respect of any such additional covenant, restriction,
condition or provision such supplemental indenture may provide for a
particular period of grace after default (which period may be shorter
or longer than that allowed in the case of other defaults) or may
provide for an immediate enforcement upon such an Event of Default or
may limit the remedies available to the indenture trustee upon such an
Event of Default or may limit the right of the applicable holder
representative to waive such an Event of Default;
27
o to cure any ambiguity or to correct or supplement any provision
contained in the relevant indenture or in any applicable supplemental
indenture or note certificate which may be defective or inconsistent
with any other provision contained in such indenture or in any
applicable supplemental indenture or note certificate; or to make such
other provisions in regard to matters or questions arising under the
relevant indenture or under any applicable supplemental indenture or
note certificate which shall not adversely affect the interests of the
holders in any material respect; or
o to evidence and provide for the acceptance of appointment under the
relevant indenture by a successor indenture trustee with respect to
the notes of the applicable series and to add to or change any of the
provisions of such indenture as shall be necessary to provide for or
facilitate the issuing trust's administration under the applicable
indenture by more than one indenture trustee.
The issuing trust shall advise all rating agencies that are then rating the
medium term note program, the Allstate Life(R) CoreNotes(R) program or the
relevant series of notes of any such supplemental indentures.
Modifications and Amendments With Consent of Holders
With the consent of the holder or holders of not less than 66 (2)/3% in
aggregate principal amount of the outstanding notes of the applicable series,
the issuing trust and the indenture trustee may, from time to time and at any
time, enter into a supplemental indenture for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
the relevant indenture or of any applicable supplemental indenture or note
certificate or of modifying in any manner the rights of the holders of notes of
such series; provided, that no such supplemental indenture shall, without the
consent of the holder of each note of such series so affected:
o change the final maturity of such series of notes, or reduce the
principal amount thereof, or reduce the rate or extend the time of
payment of interest thereon, or impair or affect the right of any
holder of notes of such series to institute suit for the payment
thereof or modify any redemption or repayment provisions applicable to
the notes of such series;
o permit the creation of any lien on the collateral or any part thereof
(other than the applicable security interest) or terminate the
applicable security interest as to any part of the collateral, except
as permitted by the applicable indenture; or
o modify the foregoing provisions of the relevant indenture except to
increase the percentage of notes of such series required to approve
any such supplemental indenture.
The issuing trust shall advise all rating agencies that are then rating the
medium term note program, the Allstate Life(R) CoreNotes(R) program or the
relevant series of notes of any such supplemental indentures.
Indenture Trustee
Under each indenture, if an Event of Default with respect to the applicable
series of notes has occurred and is continuing, the indenture trustee is
obligated to exercise such of the rights and powers vested in it by such
indenture, and to use the same degree of care and skill in their exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
his or her own affairs.
Each indenture will provide that, except during the continuance of an Event
of Default, the indenture trustee will undertake to perform such duties and only
such duties with respect to the notes of the applicable series as are
specifically set forth in the applicable indenture. No implied covenants or
obligations shall be read into the applicable indenture against the indenture
trustee.
No provision of an indenture will be construed to relieve the indenture
trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that:
o this paragraph does not limit the effect of the preceding paragraph;
o in the absence of bad faith on its part, the indenture trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the
28
indenture trustee and conforming to the requirements of the applicable
indenture unless a responsible officer (as defined in the applicable
indenture) of the indenture trustee has actual knowledge that such
statements or opinions are false; provided that the indenture trustee
must examine such certificates and opinions to determine whether they
conform to the requirements of the applicable indenture;
o the indenture trustee will not be liable for any error of judgment
made in good faith by a responsible officer of the indenture trustee,
unless it is proved that the indenture trustee was negligent in
ascertaining the pertinent facts;
o the indenture trustee will not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with a
direction of the applicable holder representative relating to the
time, method and place of conducting any proceeding for any remedy
available to the indenture trustee, or exercising any trust or power
conferred upon the indenture trustee, under the applicable indenture
with respect to the notes of the applicable series; and
o no provision of the applicable indenture will require the indenture
trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties
thereunder, or in the exercise of any of its rights or powers
thereunder, if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
The indenture trustee may resign at any time under any indenture by giving
not less than 90 days' prior written notice thereof to the issuing trust and the
holders of the applicable series of notes. Upon receiving such notice of
resignation, the applicable trust shall promptly cause a successor trustee with
respect to the applicable series to be appointed by written instrument in
duplicate, executed by the applicable trust, one copy of which instrument shall
be delivered to the resigning indenture trustee and one copy to the successor
indenture trustee. If no successor indenture trustee shall have been so
appointed and have accepted appointment within 30 days after the giving of such
notice of resignation, the resigning indenture trustee will be permitted to
petition any court of competent jurisdiction for the appointment of a successor
indenture trustee. Such court may thereupon, after such notice, if any, as it
may deem proper and prescribe, appoint a successor indenture trustee.
If at any time:
o the indenture trustee shall cease to be eligible to serve as indenture
trustee under the requirements of the applicable indenture and shall
fail to resign after written request in accordance with the applicable
indenture;
o the indenture trustee shall become incapable of acting with respect to
the applicable series of notes or shall be adjudged as bankrupt or
insolvent, or a receiver or liquidator of the indenture trustee or of
its property shall be appointed, or any public officer shall take
charge or control of the indenture trustee or of its property or
affairs for the purpose of rehabilitation, conservation or
liquidation; or
o the indenture trustee shall fail to comply with the obligations
imposed upon it under Section 310(b) of the Trust Indenture Act with
respect to the applicable series of notes after written request
therefor by the issuing trust or any holder of such notes who has been
a bona fide holder of such notes for at least six months;
then, the issuing trust (except upon the occurrence and during the continuation
of an Event of Default) will be permitted to remove the indenture trustee with
respect to the applicable series of notes and appoint a successor indenture
trustee under and in accordance with the applicable indenture.
In addition to the right of petition given to the resigning indenture
trustee under an indenture and the right of removal given to the issuing trust
thereunder as described in the preceding two paragraphs, any holder who has been
a holder of notes of such series for at least six months may, on behalf of
itself and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor indenture trustee under the
applicable indenture or the removal of the indenture trustee and the appointment
of a successor indenture trustee under the applicable indenture, as the case may
be.
The applicable holder representative may at any time remove the indenture
trustee with respect to the notes of such series and appoint a successor
indenture trustee with respect to the notes of such series by delivering to the
indenture trustee so removed, to the successor indenture trustee so appointed
and to the issuing trust the evidence required for such action by the relevant
indenture.
29
J.P. Morgan Trust Company, National Association is affiliated with J.P.
Morgan Securities Inc., which is an Agent. With respect to any series of notes
as to which one or more affiliates of J.P. Morgan Trust Company, National
Association will serve as an Agent, the relevant trust will appoint an eligible
entity other than J.P. Morgan Trust Company, National Association and
unaffiliated with any other Agent participating in the offering of such series
of Notes to serve as indenture trustee.
Unless otherwise specified in the applicable pricing supplement, pursuant
to each indenture, J.P. Morgan Trust Company will perform the functions of the
servicer in respect of the programs. J.P. Morgan Trust Company is a national
banking association and wholly owned subsidiary of J.P. Morgan Chase & Co., a
holding company with assets in excess of $1 trillion and operations in more than
50 countries, which operations include investment banking, financial services
for consumers and businesses, financial transaction processing, asset and wealth
management and private equity.
J.P. Morgan Trust Company acts as indenture trustee through the Worldwide
Securities Services division of the Treasury & Securities Services line of
business. JPMorgan Worldwide Securities Services offers a full range of trust
and administrative services for various types of securitization transactions
from its office at 4 New York Plaza, New York, New York 10004 and other offices
worldwide. Asset classes for which JPMorgan Worldwide Securities Services serves
as trustee include residential and commercial mortgages, credit cards, auto
loans, equipment loans and leases, home equity loans, trade receivables,
commercial leases, franchise loans, funding agreement backed note programs and
student loans. JPMorgan Worldwide Securities Services is a provider of
transaction services to 23,500 clients worldwide for more than $4.5 trillion in
global debt. In transactions where J.P. Morgan Trust Company acts as an
independent collateral agent, it maintains separate accounts for the collateral
of each such transaction. J.P. Morgan Trust Company and its predecessors have
served as indenture trustee on transactions involving the securitization of
funding agreements since 1994. J.P. Morgan Trust Company currently acts as
indenture trustee or paying agent for various funding agreement backed note
programs with approximately 169 trusts outstanding as of November 30, 2005.
Meetings of Holders
A meeting of holders of notes of a series will be permitted to be called at
any time and from time to time pursuant to the relevant indenture to make, give
or take any request, demand, authorization, direction, notice, consent, waiver
or other action provided by such indenture to be made, given or taken by such
holders of notes of such series.
Unless otherwise provided in a note certificate representing the notes of a
particular series, the indenture trustee may at any time call a meeting of
holders of notes of such series for any purpose specified in the preceding
paragraph, to be held at such time and at such place in the City of New York or
the city in which the Corporate Trust Office (as defined in the applicable
indenture) is located. Notice of every meeting of holders of notes of such
series, setting forth the time and the place of such meeting and in general
terms the action proposed to be taken at such meeting, must be given not less
than 21 nor more than 180 days prior to the date fixed for the meeting.
Any resolution passed or decision taken at any meeting of holders of notes
of a series duly held in accordance with the relevant indenture will be binding
on all of the holders of notes of such series, whether or not such holders were
present or represented at the meeting.
Nonrecourse Enforcement
Notwithstanding anything to the contrary contained in an indenture or any
relevant note certificate or supplemental indenture, other than as described
below, none of Allstate Life, its officers, directors, affiliates, employees or
agents or any of the trustees of Global Funding or the trusts, beneficial owners
or agents, or any of their respective officers, directors, affiliates, employees
or agents, all of whom are collectively referred to in this prospectus as the
"nonrecourse parties," will be personally liable for the payment of any
principal, interest or any other sums at any time owing under the terms of any
notes. If any Event of Default shall occur with respect to any notes of any
series, the right of the holder or holders of notes of such series and the
indenture trustee for the benefit of such holder or holders in connection with a
claim related to such series of notes will be limited solely to a proceeding
against the relevant collateral.
Neither any such holder or holders nor the indenture trustee for the
benefit of such holder or holders will have the right to proceed against the
nonrecourse parties to enforce the notes of the relevant series (except that to
the extent they exercise their rights, if any, to seize the relevant funding
agreement(s), they may enforce the relevant funding agreement(s) against
Allstate Life) or for any deficiency judgment remaining after foreclosure of any
property included in the relevant collateral.
30
The limitations on the rights of the holders described in the previous two
paragraphs will not in any manner or way constitute or be deemed a release of
the debt or other obligations of the issuing trust evidenced by the notes of the
applicable series or otherwise affect or impair the enforceability against the
assets of the issuing trust of the liens, assignments, rights and security
interests created by the relevant indenture, the relevant collateral or any
other instrument or agreement evidencing, securing or relating to the
indebtedness or the obligations of the issuing trust evidenced by the notes of
the applicable series. The holders of notes of a series are not precluded from
foreclosing upon any property included in the relevant collateral or from any
other rights or remedies in law or in equity against the assets of the issuing
trust.
Since Allstate Life and Global Funding are registrants, purchasers of notes
may be able to proceed directly against Allstate Life and Global Funding to
enforce their rights under the Federal securities laws depending on the
particular facts and circumstances and their rights under the Federal securities
laws will be no different than if they purchased the underlying funding
agreements from Allstate Life or Global Funding.
Notices
All notices regarding notes of a series will be mailed to the registered
owners thereof as their names appear in the applicable note register maintained
by the indenture trustee.
Governing Law; Submission to Jurisdiction
Pursuant to Section 5-1401 of the General Obligations Law of the State of
New York, each indenture and the notes of each series shall (unless specified
otherwise in the applicable pricing supplement) be governed by, and construed in
accordance with, the laws of the State of New York, except as required by
mandatory provisions of law and except to the extent that the validity or
perfection of the ownership of and security interest in the relevant funding
agreements of the issuing trust or remedies under the applicable indenture in
respect thereof may be governed by the laws of a jurisdiction other than the
State of New York. All judicial proceedings brought against a trust or the
indenture trustee arising out of or relating to the relevant indenture, any note
of the applicable series or any portion of the relevant collateral may be
brought in any state or Federal court in the State of New York, provided that
the applicable pricing supplement may specify other jurisdictions as to which
the issuing trust may consent to the nonexclusive jurisdiction of courts with
respect to such series of notes.
31
DESCRIPTION OF THE FUNDING NOTES
Each trust will use the net proceeds received from the issuance of the
related series of notes to purchase a funding note. Global Funding will use the
net proceeds received from the sale of the related funding note to purchase one
or more funding agreements issued by Allstate Life. Pursuant to each funding
note indenture, Global Funding will immediately pledge and collaterally assign
each such funding agreement to and grant a security interest in each such
funding agreement and the related collateral in favor of the funding note
indenture trustee. Global Funding will immediately thereafter assign absolutely
to, and deposit into, the applicable trust each such funding agreement and, in
connection with such assignment and deposit, the relevant funding note will be
surrendered for cancellation by or on behalf of the applicable trust, and will
be cancelled by the funding note indenture trustee, and the pledge and
collateral assignment of each funding agreement to, and the security interest in
favor of, the funding note indenture trustee will be terminated. Such
cancellation will act as a redemption and satisfaction of the funding note.
The funding note will have a principal amount equal to the principal amount
of the related funding agreement(s) and the related series of notes. Each
funding note will otherwise have payment and other terms substantially similar
to the related funding agreement(s) and the related series of notes, except that
the terms of each funding note will provide that it will be cancelled
immediately upon the sale of, and deposit into, the issuing trust by Global
Funding of the related funding agreement(s).
32
DESCRIPTION OF THE FUNDING AGREEMENTS
This section provides a summary of the material terms and conditions of the
funding agreements issued under the programs. Specific terms of the funding
agreement(s) issued with respect to a series of notes and the extent to which
these general provisions apply to such funding agreement(s) will be provided in
the applicable prospectus supplement and pricing supplement to this prospectus.
This summary is not complete and you should read the detailed provisions of the
funding agreements. A copy of the form of funding agreement is filed as an
exhibit to the registration statement (of which this prospectus is a part) and
is incorporated into this prospectus by reference.
General
In connection with the issuance of a series of notes, Global Funding will
use the proceeds received from the issuance and sale of the applicable funding
note to purchase one or more funding agreements issued by Allstate Life. Global
Funding will immediately pledge and collaterally assign each such funding
agreement to the funding note indenture trustee as collateral to secure the
obligations under the applicable series of notes and immediately thereafter
assign absolutely to, and deposit into, the issuing trust each such funding
agreement.
Each such funding agreement will be held separately as collateral by the
indenture trustee for the benefit of the holders of the applicable series of
notes. Each funding agreement will represent Allstate Life's unsecured
obligation. Under the funding agreement(s) securing the obligations of a trust
under its series of notes, the applicable trust shall pay Allstate Life one or
more deposit(s) in an aggregate amount equal to the issue price of the
applicable series of notes plus accrued interest, if any, less any commission or
compensation payments due to any person. Such deposit(s) shall be made in the
currency in which such notes are denominated. Upon receipt of such deposit(s),
Allstate Life shall be obligated to establish one or more general account
records, each of which is referred to as a "funding account", which will
evidence its obligation under the funding agreement(s). Unless otherwise
specified in the applicable pricing supplement, the deposit(s) of such
obligation(s) will be deemed to be equal to the aggregate face amount of the
notes of the applicable series of notes and interest, if any, will accrue on
such balance at such rate and upon such terms as is accruing on the applicable
series of notes. See "Description of the Notes" in the applicable prospectus
supplement. Unless otherwise specified in the applicable pricing supplement, for
each funding agreement securing a series of notes other than discount notes, the
deposits received pursuant to the funding agreement (as specified in the pricing
annex to such funding agreement), less any withdrawals to make payments under
such funding agreement (other than additional amounts, if applicable), plus any
interest accrued pursuant to such funding agreement, all as set forth in the
pricing annex to such funding agreement, is referred to as the "funding account
balance". Unless otherwise specified in the applicable pricing supplement, for
each funding agreement securing a series of notes that are discount notes, the
deposit received pursuant to the funding agreement (as specified in the pricing
annex to such funding agreement), less any withdrawals to make payments under
such funding agreement (other than additional amounts, if applicable), plus any
accrual of discount (determined in accordance with the applicable series of
notes), plus, if applicable, any interest accrued pursuant to such funding
agreement, all as set forth in the pricing annex to such funding agreement, is
referred to as "funding account balance". The obligations of Allstate Life under
each funding agreement will constitute its general account obligations and shall
not be obligations of any of its separate accounts.
Under each funding agreement issued under the program, Allstate Life will
be obligated to make or cause to be made certain payments as are necessary to
permit the issuing trust to meet in full its scheduled payment obligations under
the relevant series of notes. Therefore, the currency of denomination, maturity,
redemption, repayment and interest rate provisions of the funding agreement(s)
issued by Allstate Life to the issuing trust shall be structured so that the
payments made by or at the direction of Allstate Life will enable the issuing
trust to meet its requisite obligations under the relevant series of notes. The
repayment of principal on such funding agreement(s) will occur at the stated
date of maturity of the funding agreement(s), or, under certain circumstances
specified by the terms of the funding agreement(s), at a date or dates prior to
maturity. Amounts received by the issuing trust in respect of interest or
principal on the funding agreement(s) held by it will be applied to all payments
due the holders of notes of the related series of notes. Additional terms of
each applicable funding agreement will be described in the applicable prospectus
supplement and pricing supplement.
A funding agreement is a type of insurance company product in which the
purchaser, usually an institutional investor, pays the insurance company a
deposit and, in turn, receives scheduled payments of principal and interest. The
deposit Allstate Life receives on the issuance of a funding agreement under the
programs will be part of its general account and not allocated to any of its
separate accounts. Allstate Life's general account is the account which contains
all of its assets and liabilities other than those held in its separate
accounts. Separate accounts are segregated accounts which are established for
certain products that Allstate Life sells. A separate account holds assets and
liabilities specifically related to one or more products and segregates these
assets and liabilities from the assets and liabilities of all other separate
accounts and the assets and liabilities of Allstate Life's general account.
Since the deposit made under any funding agreement issued by Allstate Life
33
under the programs will be part of its general account, Allstate Life's
obligations under each such funding agreement will be the obligations of its
general account, rather than the obligations of any separate account. As such,
Allstate Life will invest the proceeds from the sale of funding agreements under
the programs in a portfolio of assets which along with its other general account
assets will be used to meet its contractual obligations under the funding
agreements and its other general account obligations. Allstate Life will earn
the spread differential, if any, between the cost of its obligations under such
funding agreements and the yield on its invested assets.
Allstate Life has established internal procedures to ensure that it
performs all of its payment obligations under the funding agreements. A specific
group of Allstate Life employees will monitor performance of Allstate Life's
payment obligations under the funding agreements and will promptly notify the
indenture trustee in the event it has not timely made payments under any funding
agreement. Under the applicable indenture, the calculation agent will notify
Allstate Life of the amount of interest due on any notes of the applicable
series prior to any interest payment date. Additionally, in the event that
Allstate Life fails timely to make any payment under the applicable funding
agreement(s), the indenture trustee will notify Allstate Life of such failure
and will have the right to enforce the rights of holders of the applicable
series of notes contained in the applicable indenture.
Priority of Funding Agreements
The funding agreements are unsecured obligations of Allstate Life, an
Illinois stock life insurance company. In the event of insolvency of an Illinois
insurance company, claims against the insurer's estate are prioritized pursuant
to Section 5/205 of the Illinois Insurance Code. Under Section 5/205(1)(d) of
the Illinois Insurance Code, claims by "policyholders, beneficiaries, and
insureds, under insurance policies, annuity contracts, and funding agreements"
receive payment prior to any distribution to general creditors not falling
within any other priority class under the Illinois Insurance Code.
In a properly prepared and presented case in a delinquency proceeding under
Article XIII of the Illinois Insurance Code, 215 ILCS Section 5/187 et seq. (the
"Illinois Liquidation Act"), the timely and properly filed claims of an owner
under the funding agreement (with the possible exception of claims for
Additional Amounts, as discussed below) would be entitled to distribution pari
passu with claims made by other policyholders, beneficiaries, and insureds under
other insurance policies, insurance contracts, annuities and funding agreements
issued by Allstate Life, and the claims of the Illinois Life and Health
Insurance Guaranty Association, and any similar organization in another state,
in accordance with Section 5/205(1)(d) of the Illinois Liquidation Act, and an
owner's claims under the funding agreement should not be recharacterized as
other than the claims of a policyholder, beneficiary, or insured under an
insurance policy, insurance contract, annuity or funding agreement.
If a funding agreement so provides, Allstate Life may be required to pay
Additional Amounts (as such term is defined therein) to the indenture trustee as
collateral assignee of the funding agreement. For a discussion regarding payment
of Additional Amounts, see "Description of the Notes--Withholding Tax and
Payment of Additional Amounts." The language of Section 205(1)(d) that
specifically refers to claims under "funding agreements" has not been
interpreted in any Illinois judicial decision. Specifically, there is no
authority addressing whether claims under funding agreements for Additional
Amounts would be accorded priority under Section 205(1)(d) as claims made by
other policyholders, beneficiaries and insureds under other policies, insurance
contracts, annuities and funding agreements. Accordingly, although such payments
could be viewed as a claim under the funding agreements within the meaning of
Section 5/205(1)(d), they may also be argued to be a separate payment
obligation. Therefore, while in a proceeding before a court of competent
jurisdiction the court might find that a claim for an Additional Amount
constitutes a claim under a funding agreement, it also might find that such a
claim is not a claim entitled to the priority afforded by Section 5/205(1)(d).
If a claim for an Additional Amount does not constitute a claim entitled to the
priority afforded by Section 5/205(1)(d), then in a properly prepared and
presented case any claim for an Additional Amount would be entitled to the same
priority as claims of general creditors of Allstate Life under Section
5/205(1)(g).
As insurance contracts under Illinois law, funding agreements rank senior
to unsecured indebtedness of Allstate Life. Therefore, if Allstate Life were to
offer notes directly to investors, holders of such notes would receive an
effectively subordinated obligation because of the relative priority of
insurance contracts and funding agreements over unsecured indebtedness.
With respect to any issuance of the notes of a series, the aggregate amount
of Allstate Life's liabilities that would rank pari passu with each funding
agreement securing such series of notes is disclosed in the financial statements
of Allstate Life contained in Allstate Life's most recent Annual Report on Form
10-K or Quarterly Report on Form 10-Q filed with the SEC, in each case as of the
date of such financial statements. This amount appears in the Consolidated
Statements of Financial Position as a liability under the line item entitled
"Contractholder funds."
34
The statutory authorizations for the uses of funding agreements under the
Illinois Insurance Code (the "Illinois Insurance Code") are severely limited.
The form of funding agreement has been filed with the Illinois Department of
Insurance and has been accepted as a funding agreement that is a type of annuity
contract without life contingency permitted by Section 5/226.1 of the Illinois
Insurance Code. Under that provision, the permitted uses are limited to funding
of: (a) ERISA employee benefit plans, as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"); (b) an activity of
an Internal Revenue Code Section 501(c) organization; (c) a program of a
government entity or instrumentality; (d) structured settlement claims; and (e)
a program of an institution with assets in excess of $25,000,000. Thus, the
market for direct sales of funding agreements is very narrow, essentially
limited to large institutional investors under Rule 144A or foreign investors
under Regulation S promulgated under the Securities Act, as amended. Moreover,
in contrast to medium term notes, funding agreements have no secondary market to
provide investors with liquidity or mark-to-market valuation and, therefore, the
funding agreement market is much narrower than the universe of investors who can
purchase medium term notes.
In addition, funding agreements are insurance contracts authorized by
Section 5/226.1 of the Illinois Insurance Code. Only licensed insurance agents
or the issuing insurance company may sell such contracts. Thus, not only is the
market for direct funding agreement sales limited by the specified classes of
buyers, but it is restricted also by the limits on the agency force.
The Illinois Department of Insurance has confirmed that it does not
consider the sale of publicly offered funding agreement backed medium term notes
to violate the Illinois Insurance Code. In addition, the Illinois Department of
Insurance has approved the form of funding agreement to be used in connection
with the medium term note program and the Allstate Life(R) CoreNotes(R) program.
Ratings
The rating by any rating agency of the financial strength of Allstate Life
does not mean that such rating agency will rate a funding agreement or the
related series of notes. However, unless otherwise indicated in the applicable
pricing supplement, each series of notes, the related funding note and the
funding agreement(s) securing such series of notes will have an issue credit
rating of "AA" from Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc. ("Standard & Poor's"). We expect the program to be
rated "Aa2" by Moody's Investors Service, Inc. ("Moody's") and "AA" by Standard
& Poor's. If Moody's or Standard & Poor's changes the program rating, the new
program rating will be specified in the applicable pricing supplement. Notes of
a series will be issued under the program only in the event that, at the time of
issuance of such series of notes, at least one nationally recognized rating
agency would assign an investment grade rating to such series of notes, the
related funding note and the funding agreement(s) securing such series of notes.
Insolvency of Allstate Life
In the event of insolvency of an Illinois insurance company, claims against
the insurer's estate are prioritized pursuant to Section 5/205 of the Illinois
Insurance Code. Under Section 5/205(1)(d) of the Illinois Insurance Code, claims
by "policyholders, beneficiaries, and insureds, under insurance policies,
annuity contracts, and funding agreements" receive payment prior to any
distribution to general creditors not falling within any other priority class
under the Illinois Insurance Code. The funding agreements are unsecured
obligations of Allstate Life.
Lord, Bissell & Brook LLP, special Illinois insurance regulatory counsel of
Allstate Life, has opined that, subject to the limitations, qualifications and
assumptions set forth in its opinion letter, in a properly prepared and
presented case, (1) in a delinquency proceeding under Article XIII of the
Illinois Insurance Code, 215 ILCS Section 5/187 et seq. (the "Illinois
Liquidation Act"), the timely and properly filed claims of an owner under the
funding agreement (with the possible exception of claims for Additional Amounts,
as discussed below) would be entitled to distribution pari passu with claims
made by other policyholders, beneficiaries, and insureds under other insurance
policies, insurance contracts, annuities and funding agreements issued by
Allstate Life, and the claims of the Illinois Life and Health Insurance Guaranty
Association, and any similar organization in another state, in accordance with
Section 5 /205(1)(d) of the Illinois Liquidation Act, and (2) an owner's claims
under the funding agreement should not be recharacterized as other than the
claims of a policyholder, beneficiary, or insured under an insurance policy,
insurance contract, annuity or funding agreement.
If a funding agreement so provides, Allstate Life may be required to pay
Additional Amounts (as such term is defined therein) to the indenture trustee as
collateral assignee of the funding agreement. Although such payments could be
viewed as a claim under the funding agreements within the meaning of Section
5/205(1)(d), it may also be argued to be a separate payment obligation.
Therefore, while in a proceeding before a court of competent jurisdiction the
court might find that a claim for an Additional Amount constitutes a claim under
a funding agreement, it also might find that such a claim is
35
not a claim entitled to the priority afforded by Section 5 /205(1)(d). Lord,
Bissell & Brook LLP has opined that if a claim for an Additional Amount does not
constitute a claim entitled to the priority afforded by Section 5/205(1)(d),
then in a properly prepared and presented case any claim for an Additional
Amount would be entitled to the same priority as claims of general creditors of
Allstate Life under Section 5/205(1)(g).
In the absence of controlling judicial precedents, the opinion of Lord,
Bissell & Brook LLP is based on a reasoned analysis of Illinois statutes, as
well as application of other states' judicial decisions involving similar or
analogous circumstances, and is subject to the limitations, qualifications and
assumptions set forth in its opinion letter. Investors should note that in the
event of the insolvency of an insurance company, however, the judicial
application of statutes governing the distribution of the insurer's general
assets has typically proceeded on a case-by-case basis.
The scope of the Lord, Bissell & Brook LLP opinion regarding a liquidation
proceeding with respect to Allstate Life is limited to an Illinois liquidation
proceeding and only those claims that are made in domiciliary proceedings in an
Illinois court. The opinion of Lord, Bissell & Brook LLP recites basic facts
with respect to the funding agreement, the transaction in which the funding
agreement is to be issued and the parties to the transaction, and those facts
are implicitly assumed in connection with the rendering of the opinion.
The assumptions, limitations and qualifications in the opinion include,
without limitation:
o that it is limited to the application of the law of the State of
Illinois;
o that the opinion is rendered solely as of the date thereof;
o that limited documents were reviewed in issuing the opinion and that
no opinion is expressed as to such documents;
o that the funding agreement may be issued with a life contingency;
o that the opinion assumes the veracity and accuracy of the form of the
funding agreement reviewed and the funding agreement's enforceability
under and compliance with applicable laws, as well as the adherence to
the proper legal formalities of and separate corporate distinctions
between Allstate Life and the holders of the notes;
o that there is no Illinois statutory or case law guidance as to the
definition of "annuity contract;" and
o that the terms "policyholders," "beneficiaries" and "insureds" are not
defined in the Illinois Liquidation Act.
Payments under Funding Agreements
Under the terms of each funding agreement securing the obligations under a
series of notes, Allstate Life will be obligated to make payments in the amounts
necessary to permit the issuing trust to meet in full its scheduled payment
obligations under the applicable series of notes.
Unless otherwise specified in the applicable pricing supplement, the
issuing trust will not pay any additional amounts to holders of the notes of a
series in the event that any withholding or deduction for or on account of any
United States taxes or other governmental charges is required. If the applicable
prospectus supplement or the applicable pricing supplement specifies that the
issuing trust will pay additional amounts to holders of the notes of the
applicable series in the event of certain changes in tax law, including the
repeal of the "Portfolio Interest Exemption" from United States Federal
withholding taxes for payments to non-U.S. Holders, the relevant funding
agreement(s) will provide that Allstate Life will make payments to the issuing
trust in the amounts necessary to permit it to pay additional amounts, if any,
required to be paid to holders of the particular series of notes. If the payment
of additional amounts to holders of a particular series of notes is required as
a result of a change in tax law, Allstate Life will be obligated to pay such
additional amounts to the issuing trust under the relevant funding agreement(s).
Events of Default
The following will be "Events of Default" under each funding agreement:
o default in the payment when due and payable of any principal amount
under the funding agreement;
36
o default in the payment of any interest accrued when such amounts
become due and payable, and continuance of such default for a period
of five business days;
o Allstate Life fails, is unable, or Allstate Life admits in writing its
inability, generally to pay its debts as such debts become due; or the
board of directors of Allstate Life adopts any action to approve or
for the purpose of effecting any of the actions referred to in this
paragraph;
o default in the performance or breach of any one or more of the other
covenants of Allstate Life under such funding agreement, and
continuance of such default or breach for a period of 45 days after
there has been given notice thereof to Allstate Life;
o a court having jurisdiction in the premises has entered a decree or
order for relief in respect of Allstate Life in an involuntary case
under any applicable bankruptcy, insolvency or other similar law now
or hereafter in effect in the United States of America or any other
applicable jurisdiction which decree or order is not stayed; or any
other similar relief has been granted under any applicable law;
o an insolvency case has been commenced against Allstate Life under any
applicable bankruptcy, insolvency or other similar law now or
hereafter in effect in the United States of America or any other
applicable jurisdiction and such case shall not have been dismissed or
stayed, in each case within 45 days, or a decree or order of a court
having jurisdiction in the premises for the appointment of a receiver,
liquidator, rehabilitator, conservator, sequestrator, trustee,
custodian or other officer having similar powers over Allstate Life,
or over all or a substantial part of its property, has been entered;
or there has occurred the involuntary appointment of an interim
receiver, trustee or other custodian of Allstate Life, for all or a
substantial part of its property; or a court having jurisdiction in
the premises has entered a decree or order declaring the dissolution
of Allstate Life; or a warrant of attachment, execution or similar
process has been issued against any substantial part of the property
of Allstate Life;
o the Director of the Illinois Department of Insurance or any other
insurance supervisor having jurisdiction over Allstate Life shall have
filed a petition seeking any order under the Illinois Insurance Code
or other applicable insurance law to rehabilitate, liquidate, or
conserve the assets of, or take other similar action with respect to,
Allstate Life; or
o Allstate Life commences a voluntary case or other proceeding seeking
liquidation, dissolution, reorganization or other relief with respect
to itself or its debts under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect in the United States of
America (or any state thereof) or any other applicable jurisdiction,
or seeking the appointment of a receiver, liquidator, rehabilitator,
sequestrator, conservator or other similar officer of Allstate Life or
any substantial part of its property, or consents to the entry of an
order for relief in an involuntary case, or to the conversion of an
involuntary case to a voluntary case, under any such law, or consents
to the appointment of or taking possession by a receiver, trustee or
other custodian for all or a substantial part of its property; or
Allstate Life makes any general assignment for the benefit of
creditors.
If one or more Events of Default shall have occurred and be continuing
(other than an Event of Default specified in the third, fourth, fifth, sixth,
seventh and eighth bullets above), the indenture trustee as collateral assignee
of the funding agreement may, by written notice to Allstate Life, declare the
principal of, plus accrued but unpaid interest on and any other amounts then due
and owing with respect to, such funding agreement to be due and payable and such
amounts will become due and payable on the date the written declaration is given
to Allstate Life; provided that if an Event of Default specified in the third,
fourth, fifth, sixth, seventh and eighth bullets above occurs, such amounts will
be automatically and immediately due and payable without any declaration or
other act on the part of the indenture trustee as collateral assignee of the
funding agreement; provided further that, without affecting the obligation of
Allstate Life to repay such amounts, no such repayment shall be made in
preference to other policyholders of Allstate Life.
Representations and Warranties in the Funding Agreement
In each funding agreement, each party will represent and warrant as
follows:
o the representing party has the power to enter into the funding
agreement and to consummate the transactions contemplated thereby;
37
o the funding agreement has been duly authorized, executed and delivered
by the representing party;
o assuming the due authorization, execution and delivery thereof by the
other party thereto, the funding agreement constitutes a legal, valid
and binding obligation of the representing party; and
o the funding agreement is enforceable against the representing party in
accordance with the terms thereof, subject to applicable bankruptcy,
insolvency and similar laws affecting creditors' rights and subject,
as to enforceability, to general principles of equity, regardless of
whether enforcement is sought in a proceeding in equity or at law.
Restrictions on Transfer
Each funding agreement will contain provisions prohibiting any transfer or
assignment of the funding agreement or any right to receive payments under the
funding agreement without the express written consent of Allstate Life and the
written affirmation of Allstate Life that it has changed its books and records
to reflect the transfer or assignment or right to receive payments under the
funding agreement. In connection with the issuance of a series of notes,
Allstate Life will consent to the sale and deposit of each relevant funding
agreement from the depositor to the issuing trust and the pledge and collateral
assignment of, and the grant of a security interest in, each such funding
agreement to the indenture trustee, and will affirm that it has changed its
books and records to reflect the foregoing.
Termination of Funding Agreements by Allstate Life
If the applicable pricing supplement specifies that the issuing trust will
pay additional amounts to holders of its notes in the event of certain changes
in tax law, including the repeal of the "Portfolio Interest Exemption" from
United States Federal withholding taxes for payments to non-U.S. Holders, the
funding agreement(s) securing such series of notes will provide that Allstate
Life may terminate the relevant funding agreement(s) upon the occurrence of
certain specified tax events. Unless otherwise specified in the applicable
Pricing Supplement, Allstate Life will not be able to unilaterally terminate any
funding agreements under any other circumstances. In order to terminate the
relevant funding agreement(s) in the event of a certain change in tax law,
Allstate Life must give not less than 30 and no more than 75 days prior written
notice to the issuing trust and pay such issuing trust the outstanding principal
of and accrued but unpaid interest, including any additional amounts due and
owing, on the notes of such series or such other amount as is specified in the
applicable pricing supplement for such notes. However, Allstate Life may not
give notice of termination earlier than 90 days prior to the earliest day when
Allstate Life would become obligated to pay any such additional amounts were a
payment in respect of the funding agreement(s) then due.
Governing Law
Each funding agreement will be governed by, and construed in accordance
with, the laws of the State of Illinois without regard to conflict of law
principles.
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DESCRIPTION OF SUPPORT AND EXPENSES AGREEMENTS
Support and Expenses Agreements of the Trusts
This section provides a summary of the material terms and conditions of
each support and expenses agreement to be entered into by Allstate Life and the
applicable issuing trust (each, a "support agreement"). Each support agreement
will incorporate by reference the standard support and expenses agreement terms.
The form of support and expenses agreement is included in the form of series
instrument. This summary is not complete and you should read the detailed
provisions of the standard support and expenses agreement terms, and the
applicable support agreement. Copies of the support and expenses agreement terms
and the form of series instrument have been filed as exhibits to the
registration statement of which this prospectus is a part and are incorporated
into this prospectus by reference.
Under each support agreement, Allstate Life will agree to pay the costs and
expenses relating to the offering, sale and issuance of the applicable series of
notes, including in connection with the acquisition of the applicable funding
agreement(s), and costs, expenses and taxes incurred by the issuing trust other
than certain excluded amounts described below, and to indemnify the indenture
trustee, the Delaware trustee, the administrator and each other service
provider, as well as the issuing trust, with respect to certain matters. No
expenses will be payable from the applicable offering proceeds.
Under each support agreement, Allstate Life will not be obligated to pay
any costs, expenses, taxes or other amounts that are considered excluded
amounts. Excluded amounts include:
o any obligation Global Funding or any trust may have to make any
payment in accordance with the terms of any funding notes or any
notes;
o any obligation or expense of Global Funding or any trust to the extent
that such obligation or expense has actually been paid utilizing funds
available from payments under the applicable funding agreement(s) and
funding notes, as applicable;
o any cost, loss, damage, claim, action, suit, expense, disbursement,
tax, penalty and liability of any kind or nature whatsoever resulting
from or relating to any insurance regulatory or other governmental
authority asserting that:
o the funding notes or the notes are, or are deemed to be,
participations in the funding agreements or contracts of
insurance, or
o the offer, purchase, sale and/or transfer of the funding notes or
the notes and/or the pledge and collateral assignment of, or the
grant of a security interest in, any funding agreement,
constitute the conduct of the business of insurance or
reinsurance in any jurisdiction or require Global Funding, any
trust or any holder to be licensed as an insurer, insurance agent
or broker in any jurisdiction;
o any obligation of Global Funding or any trust to pay additional
amounts to indemnify any holder of the funding notes or the notes
against potential withholding tax liabilities;
o any cost, loss, damage, claim, expense, tax, penalty or liability of
any kind imposed on a service provider to the trust resulting from the
bad faith, misconduct or negligence of such service provider;
o any income taxes or overhead expenses of any service provider; or
o any withholding taxes imposed with respect to payments made under any
funding agreement or any notes, or any obligation to pay additional
amounts.
With respect to any support obligation owed to the Delaware trustee and the
administrator, excluded amounts specified in the third bullet point above shall
not apply.
Support and Expenses Agreement of Global Funding
Allstate Life and Global Funding entered into an amended and restated
support and expenses agreement dated as of February -, 2006 (the "depositor
support agreement"). Pursuant to the depositor support agreement Allstate Life
agreed to pay the costs and expenses relating to the offering, sale and issuance
of each funding note and costs, expenses and taxes
39
incurred by Global Funding other than the excluded amounts (as described under "
- --Support and Expenses Agreements of the Trusts" above). Pursuant to the
depositor trust agreement Allstate Life also agreed to indemnify the indenture
trustee, the Delaware trustee, the administrator and each other service
provider, as well as Global Funding, with respect to certain matters.
Under the depositor trust agreement, Allstate Life will not be obligated to
pay any costs, expenses, taxes or other amounts that are considered excluded
amounts.
DESCRIPTION OF ADMINISTRATIVE SERVICES AGREEMENTS
Administrative Services Agreements of the Trusts
This section provides a summary of the material terms and conditions of
each administrative services agreement to be entered into between the
administrator and each trust to be formed in connection with the issuance of a
series of notes (each, an "administrative services agreement"). The form of
administrative services agreement is included in the form of series instrument.
Each administrative services agreement will incorporate by reference the
standard administrative services terms. This summary is not complete and you
should read the detailed provisions of the standard administrative services
terms and the applicable administrative services agreement. Copies of the
standard administrative services terms and the form of series instrument have
been filed as exhibits to the registration statement of which this prospectus is
a part and are incorporated into this prospectus by reference.
Pursuant to each administrative services agreement, the administrator will
perform various financial, statistical, accounting and other services for the
issuing trust, including maintenance of books and records, preparation, upon
request, of amendments to and waivers under certain documents, holding,
maintaining and preserving executed copies of certain documents; upon receipt of
notice, taking certain actions to enforce agreements as to which the issuing
trust is a party, preparing certain documents for signature by the issuing
trust, obtaining services of outside counsel, accountants and/or other outside
service providers, other actions incidental or reasonably necessary to
accomplish the foregoing and certain other actions specifically directed by the
issuing trust. In addition, the administrator will prepare and file with the SEC
and, if necessary, execute, on behalf of the issuing trust such documents,
forms, certifications or filings as may be required by the Exchange Act.
Each administrative services agreement will be governed by, and construed
in accordance with, the laws of the State of New York.
Administrative Services Agreement of Global Funding
Global Funding and the administrator executed the amended and restated
administrative services agreement of Global Funding, dated as of February -,
2006 (as amended, supplemented, modified, restated or replaced from time to
time, the "depositor administrative services agreement").
Pursuant to the depositor administrative services agreement, the
administrator agreed to perform various financial, statistical, accounting and
other services for Global Funding, including maintenance of books and records,
preparation, upon request, of amendments to and waivers under certain documents,
holding, maintaining and preserving executed copies of certain documents; upon
receipt of notice, taking certain actions to enforce agreements as to which
Global Funding is a party, preparing certain documents for signature by Global
Funding, obtaining services of outside counsel, accountants and/or other outside
service providers, other actions incidental or reasonably necessary to
accomplish the foregoing and certain other actions specifically directed by
Global Funding. In addition, the administrator will prepare and file with the
SEC and, if necessary, execute on behalf of Global Funding such documents,
forms, certifications or filings as may be required by the Exchange Act.
The depositor administrative services agreement is governed by, and will be
construed in accordance with, the laws of the State of New York.
40
ERISA CONSIDERATIONS
ERISA imposes certain requirements on "employee benefit plans" (as defined
in Section 3(3) of ERISA) subject to ERISA, including entities such as
collective investment funds whose underlying assets include the assets of such
plans (collectively, "ERISA Plans"), and on those persons who are fiduciaries
with respect to ERISA Plans. Investments by ERISA Plans are subject to ERISA's
general fiduciary requirements, including the requirement of investment prudence
and diversification and the requirement that an ERISA Plan's investments be made
in accordance with the documents governing the ERISA Plan. Each fiduciary of an
ERISA Plan should consider the fiduciary standards of ERISA in the context of
the ERISA Plan's particular circumstances before authorizing an investment in
the notes. Accordingly, among other factors, the fiduciary should consider
whether the investment would satisfy the prudence and diversification
requirements of ERISA and would be consistent with the documents and instruments
governing the ERISA Plan.
Under U.S. Department of Labor regulations at 29 C.F.R. 2510.3-101, as in
effect from time to time (the "Plan Asset Regulations"), assets of a trust may
be deemed to be "plan assets" of an ERISA Plan or a "plan" such as an individual
retirement account or a Keogh plan (as defined in Section 4975(e)(1) of the
Code, other than a governmental or church plan described in Section 4975(g)(2)
or (3) of the Code) (together with ERISA Plans, "Plans") for purposes of ERISA
and Section 4975 of the Code if a Plan or a person investing plan assets of a
Plan acquires an equity interest in a trust and none of the exceptions contained
in the Plan Asset Regulations are applicable. An equity interest is defined
under the Plan Asset Regulations as an interest other than an instrument that is
treated as indebtedness under applicable local law and has no substantial equity
features. There is very little pertinent authority on the issue of what
constitutes an equity interest for purposes of the Plan Asset Regulations.
Accordingly, whether the notes would be treated as debt or equity for purposes
of the Plan Asset Regulations is unclear. Since, however, the holders of notes
of a series will have recourse only to the relevant collateral that secures such
series of notes, if the notes were treated as equity interests, the related
funding agreements would be treated as assets of any Plan holding a note.
Even if the notes were treated as equity interests for purposes of the Plan
Asset Regulations, because (a) each trust expects that the funding agreements
will be treated as debt, rather than equity, for federal tax purposes and (b)
the funding agreements should not be deemed to have any substantial equity
features, none of the assets underlying the funding agreements should be treated
as plan assets for purposes of the Plan Asset Regulations. Those conclusions are
based, in part, upon the traditional debt features of the funding agreements,
including the reasonable expectation of purchasers of the notes that the
payments due under the funding agreements will be paid when due, as well as the
absence of conversion rights, warrants and other typical equity features.
Moreover, since the Delaware trustee has no discretionary authority with
respect to the funding agreements, even if the funding agreements are treated as
assets of a Plan holding a note, the Delaware trustee should not be treated as
having acted in a fiduciary capacity with respect to the funding agreements and
the treatment of the funding agreements as plan assets should not, absent other
factors that do not appear to be present, give rise to a violation of the
prohibited transaction rules of ERISA or Section 4975 of the Code.
Therefore, subject to the considerations described herein, the notes are
eligible for purchase by Plans, any entity whose underlying assets include plan
assets by reason of any Plan's investment in the entity ("Plan Asset Entity")
and any person investing plan assets of any Plan.
Section 406 of ERISA and Section 4975 of the Code also prohibit Plans from
engaging in certain transactions involving plan assets with persons who are
"parties in interest" under ERISA or "disqualified persons" under the Code with
respect to such Plans (together, "Parties in Interest"). For example, if either
Global Funding, a trust or Allstate Life is a Party in Interest with respect to
a Plan (either directly or by reason of its ownership of its subsidiaries), the
purchase of the notes of the applicable series by or on behalf of the Plan would
likely be a prohibited transaction under Section 406(a)(1) of ERISA and/or
Section 4975(c)(1) of the Code, unless exemptive relief were available under an
applicable statutory or administrative exemption (see below). A Party in
Interest that engages in a prohibited transaction may be subject to excise taxes
and other penalties and liabilities under ERISA and the Code.
The U.S. Department of Labor has issued five prohibited transaction class
exemptions ("PTCEs") that may provide exemptive relief for direct or indirect
prohibited transactions resulting from the purchase and holding of the notes by
or on behalf of a Plan. Those class exemptions are PTCE 96-23 (for certain
transactions determined by in-house asset managers), PTCE 95-60 (for certain
transactions involving insurance company general accounts), PTCE 91-38 (for
certain transactions involving bank collective investment funds), PTCE 90-1 (for
certain transactions involving insurance company separate accounts) and PTCE
84-14 (for certain transactions determined by independent qualified professional
asset managers). There can be no assurances that any of these class exemptions
or any other exemptions will be available with respect to any
41
particular transaction involving the notes. In addition, a purchaser of the
notes should be aware that even if the conditions specified in one or more of
the above referenced or other exemptions are met, the scope of the exemptive
relief provided by the exemption might not cover all acts which might be
construed as prohibited transactions.
Accordingly, the notes may not be purchased or held by any Plan, any Plan
Asset Entity or any person investing plan assets of any Plan, unless the
purchase and holding of the notes is exempt under PTCE 96-23, 95-60, 91-38,
90-1, 84-14 or similar exemption. Any purchaser of the notes or any interest
therein, including in the secondary market, will be deemed to have represented
that, among other things, either it is not a Plan or other Plan Asset Entity and
is not purchasing the notes on behalf of or with plan assets of any Plan or
other Plan Asset Entity; or its purchase and holding of the notes is exempt
under PTCE 96-23, 95-60, 91-38, 90-1, 84-14 or similar exemption, and that such
representations shall be deemed to be made each day from the date on which the
purchaser purchases through and including the date on which the purchaser
disposes of the notes.
Moreover, the notes may not be purchased or held by any Plan, any Plan
Asset Entity or any person investing plan assets of any Plan if Global Funding,
any trust or any of their respective affiliates (a) have investment or
administrative discretion with respect to the assets of the Plan used to effect
such purchase; (b) have authority or responsibility to give, or regularly give,
investment advice with respect to such assets, for a fee and pursuant to an
agreement or understanding that such advice (1) will serve as a primary basis
for investment decisions with respect to such assets, and (2) will be based on
the particular investment needs of such Plan; or (c) unless PTCE 95-60, 91-38 or
90-1 applies, are an employer maintaining or contributing to such Plan.
Any insurance company proposing to invest assets of its general account in
the notes should consider the implications of the United States Supreme Court's
decision in John Hancock Mutual Life Insurance Co. v. Harris Trust and Savings
Bank, 510 U.S. 86, 114 S. Ct. 517 (1993), in which the United States Supreme
Court held that in certain circumstances assets in a life insurance company's
general account are treated as assets of a Plan that owns a policy or other
contract with such insurance company, as well as the effect of Section 401(c) of
ERISA as interpreted by regulations issued by the U.S. Department of Labor in
January 2000.
Due to the complexity of these rules and the penalties that may be imposed
upon persons involved in non-exempt prohibited transactions, it is particularly
important that fiduciaries or other persons considering purchasing notes on
behalf of or with plan assets of any Plan or Plan Asset Entity consult with
their counsel regarding the potential consequences under ERISA and the Code and
the availability of exemptive relief under PTCE 96-23, 95-60, 91-38, 90-1, 84-14
or similar exemption.
Governmental plans (as defined in Section 3(32) of ERISA) and certain
church plans (as defined in Section 3(33) of ERISA), if no election has been
made under Section 410(d) of the Code, while not subject to the fiduciary
responsibility provisions of ERISA or the provisions of Section 4975 of the
Code, may nevertheless be subject to state, local or other federal laws that are
substantially similar to the foregoing provisions of ERISA and the Code such as
Section 503 of the Code. No view is expressed as to whether an investment in the
notes (and any continued holding of the notes), or the operation and
administration of Global Funding or any trust, is appropriate or permissible for
any governmental plan or church plan under Section 503 of the Code, or under any
state, local or other federal law respecting such plan. Any purchaser of the
notes or any interest therein, including in the secondary market, will be deemed
to have represented that, among other things either (a) it is not a government
plan or a church plan or any entity the assets of which are treated as including
assets of such plans and it is not purchasing the notes on behalf of or with
assets of any such plan or entity or (b) its purchase, holding and disposition
of the notes is not in violation of the laws applicable to any such governmental
plan or church plan, and such representations shall be deemed to be made each
day from the date on which the purchaser purchases, through and including the
date on which the purchaser disposes of the notes. Fiduciaries of any such plans
should consult with their counsel before purchasing any notes.
The sale of any notes to a Plan is in no respect a representation by any
party or entity that such an investment meets all relevant legal requirements
with respect to investments by Plans generally or any particular Plan, or that
such an investment is appropriate for Plans generally or any particular Plan.
Notwithstanding the above, with regard to a particular trust, the sale of
notes of the applicable series to Plans, or a person utilizing the plan assets
of Plans, might not be allowed, or might only be allowed subject to certain
additional conditions, in which case the applicable pricing supplement to this
prospectus will disclose the prohibition or such additional conditions.
42
THE EMPLOYEE BENEFIT PLAN CONSIDERATIONS SET FORTH ABOVE ARE ONLY INTENDED
AS A SUMMARY AND MAY NOT BE APPLICABLE DEPENDING UPON A PLAN'S SPECIFIC FACTS
AND CIRCUMSTANCES. PLAN FIDUCIARIES SHOULD CONSULT THEIR OWN ADVISORS WITH
RESPECT TO THE ADVISABILITY OF AN INVESTMENT IN THE NOTES, AND POTENTIALLY
ADVERSE CONSEQUENCES OF SUCH INVESTMENT, INCLUDING WITHOUT LIMITATION THE
POSSIBLE EFFECTS OF CHANGES IN APPLICABLE LAWS.
43
PLAN OF DISTRIBUTION
The trusts will offer the notes from time to time for sale to or through
the agents identified in the applicable prospectus supplement (collectively, the
"Agents"). The trusts may also offer the notes from time to time for sale
directly to investors and other purchasers. The distribution of the notes
offered under this prospectus may occur in one or more transactions at fixed
prices, at market prices prevailing at the time of sale, at prices related to
such prevailing market prices or at negotiated prices, all of which may change
over time.
Each trust will use the net proceeds received from the issuance of the
related series of notes to purchase a funding note from Global Funding. Each
funding note will be cancelled immediately upon the assignment and deposit by
Global Funding of the related funding agreement(s) to the issuing trust.
Each trust will use the net proceeds received from the issuance of the
related series of notes to purchase a funding note from Global Funding. Global
Funding will use the net proceeds received from the sale of such funding note to
purchase one or more funding agreements issued by Allstate Life. Global Funding
will immediately assign absolutely to, and deposit into, the issuing trust each
such funding agreement and the related funding note will be cancelled
immediately upon the assignment and deposit by Global Funding of such funding
agreement(s) to and into the issuing trust.
In connection with any sale of the notes, the Agents may receive
compensation in the form of discounts, concessions or commissions from the
issuing trust or from purchasers of the notes for whom they may act as agents.
The Agents may sell the notes to or through dealers, and those dealers may
receive compensation in the form of discounts, concessions, or commissions from
the purchasers for whom they may act as agents. Any Agents that participate in
the offering of the notes will be identified and their compensation will be
described in the applicable prospectus supplement or the applicable pricing
supplement. The applicable prospectus supplement or the applicable pricing
supplement will also describe the other terms of the offering, including any
discounts or concessions allowed or reallowed or paid to dealers.
The Agents participating in the distribution of notes will be
"underwriters," with respect to the notes being distributed by them and the
funding agreements being purchased by the issuing trust, and any discounts or
commissions received by them on the sale or resale of notes may be deemed to be
underwriting discounts and commissions under the Securities Act. The Agents may
be entitled under agreements entered into with a trust, Global Funding and
Allstate Life to indemnification against certain civil liabilities, including
liabilities under the Securities Act, or to contribution with respect to
payments that the Agents may be required to make in respect of such liabilities.
Global Funding is a statutory issuer of the notes and the funding notes
under the Securities Act, and Allstate Life is a statutory issuer of the funding
agreements under the Securities Act.
J.P. Morgan Trust Company, National Association is affiliated with J.P.
Morgan Securities Inc., which is an Agent. With respect to any series of notes
as to which one or more affiliates of J.P. Morgan Trust Company, National
Association will serve as an Agent, the relevant trust will appoint an eligible
entity other than J.P. Morgan Trust Company, National Association and
unaffiliated with any other Agent participating in the offering of such series
of Notes to serve as indenture trustee.
In the ordinary course of its business, the Agents and their affiliates
have engaged, and may in the future engage, in investment and commercial banking
transactions with Allstate Life and certain of its affiliates.
44
LEGAL OPINIONS
Certain matters regarding the notes, funding notes and funding agreements,
and their offering will be passed upon:
o for Allstate Life by Counsel of Allstate Life (as to Illinois law,
including the validity of the funding agreements thereunder);
o for Global Funding and Allstate Life by LeBoeuf, Lamb, Greene & MacRae
LLP (as to New York law and United States Federal securities law,
including the validity of the notes and the funding notes thereunder,
and as to tax law and certain insurance regulatory matters);
o for Global Funding and Allstate Life by Lord, Bissell & Brook LLP (as
to certain Illinois regulatory matters);
o for Global Funding and Wilmington Trust Company by Richards, Layton &
Finger, P.A. (as to Delaware law, including, organization, authority
and certain regulatory matters related to Global Funding, the trusts
and the Delaware Trustee, certain security interest matters, the
enforceability of the trust agreements and the valid issuance of the
notes and the funding notes); and
o for the Agents by Sidley Austin LLP (as to United States Federal
securities law).
LeBoeuf, Lamb, Greene & MacRae LLP has from time to time represented, and
continues to represent, one or more of the Agents. Sidley Austin LLP has from
time to time represented, and continues to represent Allstate Life.
EXPERTS
The consolidated financial statements and the related consolidated
financial statement schedules incorporated in this Prospectus by reference from
the Allstate Life Insurance Company Annual Report on Form 10-K for the year
ended December 31, 2004 have been audited by Deloitte & Touche LLP, an
independent registered public accounting firm, as stated in their report (which
report expresses an unqualified opinion and includes an explanatory paragraph
relating to a change in method of accounting for certain nontraditional
long-duration contracts and for separate accounts in 2004 and changes in the
methods of accounting for embedded derivatives in modified coinsurance
agreements and variable interest entities in 2003), which is incorporated herein
by reference, and have been so incorporated in reliance upon the report of such
firm given upon their authority as experts in accounting and auditing.
With respect to the unaudited interim financial information for the periods
ended March 31, 2005 and 2004, June 30, 2005 and 2004 and September 30, 2005 and
2004 which is incorporated herein by reference, Deloitte & Touche LLP, an
independent registered public accounting firm, have applied limited procedures
in accordance with the standards of the Public Company Accounting Oversight
Board (United States) for a review of such information. However, as stated in
their reports included in the Company's Quarterly Reports on Form 10-Q for the
quarters ended March 31, 2005, June 30, 2005 and September 30, 2005 and
incorporated by reference herein, they did not audit and they do not express an
opinion on that interim financial information. Accordingly, the degree of
reliance on their reports on such information should be restricted in light of
the limited nature of the review procedures applied. Deloitte & Touche LLP are
not subject to the liability provisions of Section 11 of the Securities Act of
1933 for their reports on the unaudited interim financial information because
those reports are not "reports" or a "part" of the registration statement
prepared or certified by an accountant within the meaning of Sections 7 and 11
of the Act.
45
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the expenses to be incurred in
connection with the offering described in this registration statement. Except
for the Securities and Exchange Commission registration fee, all amounts shown
are estimates.
Securities and Exchange Commission registration fee $ 383,060
Fees and expenses of Trustees 50,000
Printing expenses 35,000
Accountant's fees and expenses 25,000
Legal fees and expenses 250,000
Rating Agency fees 400,000
Miscellaneous expenses 50,000
------
$ 1,193,060
Item 15. Indemnification of Directors and Officers.
Allstate Life Insurance Company
Under Section 8.75 of the Illinois Business Corporation Act of 1983,
Allstate Life Insurance Company is empowered, subject to the procedures and
limitations stated therein, to indemnify any person against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with any threatened, pending or
completed action, suit or proceeding to which such person is made a party or
threatened to be made a party by reason of his being or having been a director,
officer, employee or agent of Allstate Life Insurance Company, or serving or
having served at the request of Allstate Life Insurance Company as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise. Section 8.75 further provides that indemnification to
which a person may be entitled under any by-law, agreement, vote of stockholders
or disinterested directors, or otherwise, and that such indemnification to which
a person may be entitled under any bylaw, agreement, vote of stockholders or
disinterested directors, officer, employee or agent of Allstate Life Insurance
Company who has ceased to serve in such capacity, and shall inure to the benefit
of the heirs, executors and administrators of such a person.
Article VI, Section 1 of the by-laws of Allstate Life Insurance Company
provides that Allstate Life Insurance Company will indemnify all of its
directors, former directors, officers and former officers, to the fullest extent
permitted under law, who were or are a party or are threatened to be made party
to any proceeding by reason of the fact that such persons were or are directors
or officers of Allstate Life Insurance Company, against liabilities, expenses,
judgments, fines and amounts paid in settlement actually and reasonably incurred
by them. The indemnity shall not be deemed exclusive of any other rights to
which directors or officers may be entitled by law or under any articles of
incorporation, by-law, agreement, vote of stockholders or disinterested
directors or otherwise. In addition, the indemnity shall inure to the benefit of
the legal representatives of directors and officers or of their estates, whether
such representatives are court appointed or otherwise designated, and to the
benefit of the heirs of such directors and officers. The indemnity shall extend
to and include claims for such payments arising out of any proceeding commenced
or based on actions of such directors and officers taken prior to the
effectiveness of this indemnity; provided that payment of such claims had not
been agreed to or denied by Allstate Life Insurance Company before such date.
Article IV of the by-laws of The Allstate Corporation provides similar rights of
indemnification to all directors, former directors, officers and former officers
of Allstate Life Insurance Company, as a subsidiary of The Allstate Corporation.
The directors and officers of Allstate Life Insurance Company have been
provided liability insurance for certain losses arising from claims or charges
made against them while acting in their capacities as directors or officers of
Allstate Life Insurance Company.
II-1
Allstate Life Global Funding
Pursuant to an amended and restated support and expenses agreement between
Allstate Life Insurance Company and Allstate Life Global Funding to be dated on
or about the date of effectiveness of this registration statement, Allstate Life
Insurance Company will agree to indemnify Wilmington Trust Company as Delaware
trustee and AMACAR Pacific Corp. as administrator of Allstate Life Global
Funding with respect to certain matters related to the performance of such
functions.
Allstate Life Global Funding will agree, pursuant to an amended and
restated administrative services agreement of Allstate Life Global Funding to be
dated on or about the date of effectiveness of this registration statement (the
"depositor administrative services agreement"), to indemnify AMACAR Pacific
Corp., as administrator, and to hold the administrator harmless, from and
against certain losses arising out of, in connection with, or resulting from the
administrator's right and/or performance of the administrator's duties by the
administrator or its agents and employees pursuant to the depositor
administrative services agreement. Allstate Life Global Funding will also agree,
pursuant to an amended and restated indemnity agreement with Wilmington Trust
Company, to indemnify, protect, save and keep harmless Wilmington Trust Company,
as Delaware trustee, and its officers, directors, successors, assigns, legal
representatives, agents, and servants, from and against certain liabilities
relating to or arising out of the amended and restated trust agreement of
Allstate Life Global Funding, to be dated on or about the date of effectiveness
of this registration statement (as the same may be further amended, restated or
modified) or any other agreements to which Allstate Life Global Funding is a
party or to which Allstate Life Global Funding becomes a party.
Item 16. Exhibits.
(a) Exhibits
Exhibit No. Description
1.1 Form of Distribution Agreement.
1.2 Form of Terms Agreement (included in Part E to the Form of Series Instrument filed as Exhibit 4.12).
1.3 Form of Representations and Indemnity Agreement.
3.1 Articles of Amendment to the Articles of Incorporation of Allstate Life Insurance Company dated
December 29, 1999 (incorporated by reference to Form 10 dated April 24, 2002 (File No. 000-31248)).
3.2 By-Laws of Allstate Life Insurance Company, Amended and Restated June 28, 2000 (incorporated by
reference to Form 10 dated April 24, 2002 (File No. 000-31248)).
3.3 Certificate of Trust of Allstate Life Global Funding, dated as of June 24, 2002 (incorporated by
reference to Registration Statement (File No. 333-101424)).
3.4 Amended and Restated Certificate of Trust of Allstate Life Global Funding, dated as of April 20, 2004.
3.5 Form of Certificate of Trust of an Allstate Life Global Funding Trust.
4.1 Form of Amended and Restated Trust Agreement of Allstate Life Global Funding to be entered into by
Wilmington Trust Company, as Delaware Trustee, and AMACAR Pacific Corp., in its capacities as
Administrator and Trust Beneficial Owner.
4.2 Standard Trust Agreement Terms.
4.3 Form of Trust Agreement of each Issuing Trust to be entered into among Wilmington Trust Company,
AMACAR Pacific Corp. and Allstate Life Global Funding (included in Part A to the Form of Series Instrument
filed as Exhibit 4.12).
4.4 Standard Indenture Terms.
II-2
Exhibit No. Description
4.5 Form of Indenture to be entered into between each Issuing Trust and J.P. Morgan Trust Company, National
Association (included in Part G to the Form of Series Instrument filed as Exhibit 4.12 hereto).
4.6 Standard Funding Note Indenture Terms.
4.7 Form of Funding Note Indenture to be entered into between Allstate Life Global Funding and J.P. Morgan
Trust Company, National Association (included in Part H to the Form of Series Instrument filed as
Exhibit 4.12 hereto).
4.8 Form of Global Security for Secured Medium Term Notes Program.
4.9 Form of Definitive Security for Secured Medium Term Notes Program.
4.10 Form of Global Security for Allstate Life(R) CoreNotes(R) Program.
4.11 Form of Definitive Security for Allstate Life(R) CoreNotes(R) Program.
4.12 Form of Series Instrument.
4.13 Form of Closing Instrument.
5.1 Opinion of Counsel of Allstate Life Insurance Company.
5.2 Opinion of LeBoeuf, Lamb, Greene & MacRae LLP.
8 Opinion of LeBoeuf, Lamb, Greene & MacRae LLP, as Tax Counsel.
10.1 Form of Funding Agreement between Allstate Life Insurance Company and Allstate Life Global Funding
(incorporated by reference to Registration Statement (File No. 333-101424)).
10.2 Form of Funding Note related to Secured Medium Term Notes issued under the Allstate Life(R)
CoreNotes(R) Program.
10.3 Form of Funding Note related to Secured Medium Term Notes issued under the Secured Medium Term
Notes Program.
10.4 Form of Amended and Restated Support and Expenses Agreement to be entered into between Allstate
Life Insurance Company and Allstate Life Global Funding.
10.5 Standard Support and Expenses Agreement Terms.
10.6 Form of Support and Expenses Agreement (included in Part C to the Form of Series Instrument filed
as Exhibit 4.12).
10.7 Form of Amended and Restated Administrative Services Agreement to be entered into between Allstate
Life Global Funding and AMACAR Pacific Corp.
10.8 Standard Administrative Services Agreement Terms.
10.9 Form of Administrative Services Agreement of each Issuing Trust to be entered into between each
Issuing Trust and AMACAR Pacific Corp. (included in Part B to the Form of Series Instrument filed as
Exhibit 4.12).
10.10 Form of Amended and Restated Name Licensing Agreement between Allstate Insurance Company and Allstate
Life Global Funding.
10.11 Form of Name Licensing Agreement of each Issuing Trust (included in Part D to the Form of Series Instrument
filed as Exhibit 4.12).
10.12 Standard Name Licensing Agreement Terms.
10.13 Indemnity Agreement, dated as of June 24, 2002, between Allstate Life Global Funding and Wilmington Trust
Company (incorporated by reference to Registration Statement (File No. 333-101424)).
II-3
Exhibit No. Description
10.14 Form of Amended and Restated Indemnity Agreement to be entered into between Allstate Life Global
Funding and Wilmington Trust Company (incorporated by reference to Registration Statement (File
No. 333-112249)).
12 Ratio of Earnings to Fixed Charges of Allstate Life Insurance Company.
23.1 Consent of Independent Registered Public Accounting Firm.
23.2 Consent of Counsel of Allstate Life Insurance Company (included in Exhibit 5.1).
23.3 Consents of LeBoeuf, Lamb, Greene & MacRae LLP.
23.4 Consent of Lord, Bissell & Brook LLP.
23.5 Consent of Richards, Layton & Finger, P.A.
24 Power of Attorney (included as part of the Allstate Life Insurance Company signature pages).
25.1 Statement of Eligibility under the Trust Indenture Act of 1939 of J.P. Morgan Trust Company, National
Association as Indenture Trustee under the Indenture.
25.2 Statement of Eligibility under the Trust Indenture Act of 1939 of J.P. Morgan Trust Company, National
Association as Funding Note Indenture Trustee under the Funding Note Indenture.
Item 17. Undertakings.
(a) The undersigned registrants hereby undertake:
(1) To file, during any period in which offers or sales are being made of
the securities registered hereby, a post-effective amendment to this
registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of this registration statement (or the most recent post-effective
amendment hereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in this registration statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from low or high end estimated offering
range may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b), if, in the aggregate, the changes in volume and price
represent no more than 20 percent change in maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the effective
registration statement.
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this registration statement or any
material change to such information in this registration statement;
Provided, however, That:
(A) The undertakings set forth in paragraphs (i), (ii) and (iii) above do
not apply if the registration statement is on Form S-3 or Form F-3 and the
information required to be included in a post-effective amendment by those
paragraphs is contained in reports filed with or furnished to the Commission by
the registrants pursuant to section 13 or section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this registration
statement, or is contained in a form of prospectus filed pursuant to Rule 424(b)
that is part of this registration statement.
(B) Provided, further, however, that the undertakings set forth in
paragraphs (i) and (ii) do not apply if the registration statement is for an
offering of asset-backed securities on Form S-1 or Form S-3, and the information
required to be included in a post-effective amendment is provided pursuant to
Item 1100(c) of Regulation AB.
II-4
(2) That, for the purpose of determining liability under the Securities Act
of 1933 to any purchaser, if the registrants are relying on Rule 430(B):
(A) Each prospectus filed by the registrants pursuant to Rule 424(b)(3)
shall be deemed to be part of this registration statement as of the date the
filed prospectus was deemed part of and included in this registration statement;
and
(B) Each prospectus required to be filed pursuant to Rule 424(b)(2),
(b)(5), or (b)(7) as part of this registration statement in reliance on Rule
430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii) or (x)
for the purpose of providing the information required by section 10(a) of the
Securities Act of 1933 shall be deemed to be part of and included in this
registration statement as of the earlier of the date such form of prospectus is
first used after effectiveness or the date of the first contract of sale of
securities in the offering described in the prospectus. As provided in Rule
430(B), for liability purposes of the issuer and any person that is at the date
an underwriter, such date shall be deemed to be a new effective date of this
registration statement relating to the securities in the registration statement
to which that prospectus relates, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof. Provided ,
however, that no statement made in this registration statement or prospectus
that is part of this registration statement or made in a document incorporated
or deemed incorporated by reference into this registration statement or
prospectus that is part of this registration statement will, as to a purchaser
with a time of contract of sale prior to such effective date, supersede or
modify any statement that was made in this registration statement or prospectus
that was part of this registration statement or made in any such document
immediately prior to such effective date.
(3) That, for the purpose of determining liability of the registrant under
the Securities Act of 1933 to any purchaser in the initial distribution of the
securities:
The undersigned registrants undertake that in a primary offering of
securities of the undersigned registrants pursuant to this registration
statement, regardless of the underwriting method used to sell the securities to
the purchaser, if the securities are offered or sold to such purchaser by means
of any of the following communications, the undersigned registrants will be
sellers to the purchaser and will be considered to offer or sell such securities
to such purchaser:
(i) Any preliminary prospectus or prospectus of the undersigned registrants
relating to the offering required to be filed pursuant to Rule 424;
(ii) Any free writing prospectus relating to the offering prepared by or on
behalf of the undersigned registrants or used or referred to by the undersigned
registrants;
(iii) The portion of any other free writing prospectus relating to the
offering containing materials information about the undersigned registrants or
their securities provided by or on behalf of the undersigned registrants; and
(iv) Any other communication that is an offer in the offering made by the
undersigned registrants to the purchaser.
(4) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(5) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(b) The undersigned registrants hereby further undertake that, for purposes
of determining any liability under the Securities Act of 1933, each filing of
any annual report pursuant to section 13(a) or section 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in this registration
statement shall be
II-5
deemed to be a new registration statement relating to the securities offered
herein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(c) The undersigned registrants hereby undertake to file an application for
the purposes of determining eligibility of the trustee to act under Subsection
(a) of Section 310 of the Trust Indenture Act in accordance with the rules and
regulations prescribed by the Commission under Section 305(b)(2) of the Trust
Indenture Act.
(d) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the provisions discussed in Item 15 above, or
otherwise, the undersigned registrants have been advised that in the opinion of
the Commission such indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
Allstate Life of expenses incurred or paid by its director, officer or
controlling person in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in connection with
the securities being registered, Allstate Life will, unless in the opinion of
its counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Securities Act of 1933 and will
be governed by the final adjudication of such issue.
(e) The undersigned registrants hereby undertake that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
annual report pursuant to section 13(a) or section 15(d) of the Securities
Exchange Act of 1934 of a third party that is incorporated by reference in the
registration statement in accordance with Item 1100(c)(1) of Regulation AB (17
CFR 229.1100(c)(1)) shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(f) The undersigned registrants hereby undertake to deliver or cause to be
delivered with the prospectus, to each person to whom the prospectus is sent or
given, the latest annual report, to security holders that is incorporated by
reference in the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be presented by
Article 3 of Regulation S-X is not set forth in the prospectus, to deliver, or
cause to be delivered to each person to whom the prospectus is sent or given,
the latest quarterly report that is specifically incorporated by reference in
the prospectus to provide such interim financial information.
II-6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
Allstate Life Global Funding certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly caused
this amendment no. 2 to the registration statement to be signed on its behalf by
the undersigned, thereunto duly authorized, in the City of Charlotte, State of
North Carolina, on February 27, 2006.
ALLSTATE LIFE GLOBAL FUNDING
By: AMACAR Pacific Corp.,
not in its individual capacity,
but solely as administrator
By: /s/ Evelyn Echevarria
--------------------------
Name: Evelyn Echevarria
Title: Vice President, Secretary and Director of AMACAR
Pacific Corp.
Pursuant to the requirements of the Securities Act of 1933, this amendment
no. 2 to the registration statement has been signed on behalf of Allstate Life
Global Funding by AMACAR Pacific Corp., not in its individual capacity, but
solely as the administrator, on February 27, 2006 by the following persons
solely in the capacities indicated.
Signature Title
/s/ Douglas K. Johnson Chief Executive Officer and Director of AMACAR Pacific Corp.
- ---------------------- (Principal Executive Officer)
Douglas K. Johnson
/s/ Juliana C. Johnson Chief Financial Officer, Principal Accounting Officer and Director of
- ---------------------- AMACAR Pacific Corp.
Juliana C. Johnson (Principal Financial Officer and Principal Accounting Officer)
/s/ Evelyn Echevarria Vice President, Secretary and Director of AMACAR Pacific Corp.
- ----------------------
Evelyn Echevarria
II-7
Pursuant to the requirements of the Securities Act of 1933, as amended,
Allstate Life Insurance Company certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3 and has
duly caused this amendment no. 2 to the registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the Township of
Northfield, and State of Illinois, on February 27, 2006.
ALLSTATE LIFE INSURANCE COMPANY
By: /s/ Casey J. Sylla
---------------------------
Casey J. Sylla, Chairman of the Board, President and Director
Each person whose signature appears below hereby appoints John C. Pintozzi,
Kevin R. Slawin, Casey J. Sylla, and Michael J. Velotta as his or her true and
lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this registration statement and any registration statement for the same
offering filed pursuant to Rule 462 under the Securities Act of 1933, and to
file the same, with all exhibits thereto and all other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents full power and authority to do and perform each and
every act and anything appropriate or necessary to be done, as fully and for all
confirming all that said attorneys-in-fact and agents or their substitute or
substitutes may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this amendment
no. 2 to the registration statement has been signed on February 27, 2006 by the
following persons in the capacities indicated.
II-8
Signature Title
/s/ David A. Bird Senior Vice President and Director of Allstate Life
- -----------------------
David A. Bird
/s/ Danny L. Hale Director of Allstate Life
- -----------------------
Danny L. Hale
/s/ Edward M. Liddy Director of Allstate Life
- -----------------------
Edward M. Liddy
/s/ John C. Lounds Senior Vice President and Director of Allstate Life
- -----------------------
John C. Lounds
/s/ Doublas B. Welch Senior Vice President and Director of Allstate Life
- -----------------------
Douglas B. Welch
/s/ Samuel H. Pilch Group Vice President and Controller of Allstate Life
- -----------------------
Samuel H. Pilch
/s/ John C. Pintozzi Senior Vice President, Chief Financial Officer and Director of Allstate Life
- ----------------------- (Principal Financial Officer)
John C. Pintozzi
/s/ Eric A. Simonson Senior Vice President, Chief Investment Officer and Director of Allstate Life
- -----------------------
Eric A. Simonson
/s/ Kevin R. Slawin Senior Vice President and Director of Allstate Life
- -----------------------
Kevin R. Slawin
/s/ Casey J. Sylla Chairman of the Board, President and Director of Allstate Life
- ----------------------- (Principal Executive Officer)
Casey J. Sylla
/s/ Michael J. Velotta Senior Vice President, General Counsel, Secretary and Director of Allstate Life
- -----------------------
Michael J. Velotta
/s/ Thomas J. Wilson, II Director of Allstate Life
- ------------------------
Thomas J. Wilson, II
II-9
EXHIBIT INDEX
Exhibit No. Description
1.1 Form of Distribution Agreement.
1.2 Form of Terms Agreement (included in Part E to the Form of Series Instrument filed as Exhibit 4.12).
1.3 Form of Representations and Indemnity Agreement.
3.1 Articles of Amendment to the Articles of Incorporation of Allstate Life Insurance Company dated
December 29, 1999 (incorporated by reference to Form 10 dated April 24, 2002 (File No. 000-31248)).
3.2 By-Laws of Allstate Life Insurance Company, Amended and Restated June 28, 2000 (incorporated by
reference to Form 10 dated April 24, 2002 (File No. 000-31248)).
3.3 Certificate of Trust of Allstate Life Global Funding, dated as of June 24, 2002 (incorporated by
reference to Registration Statement (File No. 333-101424)).
3.4 Amended and Restated Certificate of Trust of Allstate Life Global Funding, dated as of April 20, 2004.
3.5 Form of Certificate of Trust of an Allstate Life Global Funding Trust.
4.1 Form of Amended and Restated Trust Agreement of Allstate Life Global Funding to be entered into by
Wilmington Trust Company, as Delaware Trustee, and AMACAR Pacific Corp., in its capacities as
Administrator and Trust Beneficial Owner.
4.2 Standard Trust Agreement Terms.
4.3 Form of Trust Agreement of each Issuing Trust to be entered into among Wilmington Trust Company,
AMACAR Pacific Corp. and Allstate Life Global Funding (included in Part A to the Form of Series
Instrument filed as Exhibit 4.12).
4.4 Standard Indenture Terms.
4.5 Form of Indenture to be entered into between each Issuing Trust and J.P. Morgan Trust Company,
National Association (included in Part G to the Form of Series Instrument filed as Exhibit 4.12 hereto).
4.6 Standard Funding Note Indenture Terms.
4.7 Form of Funding Note Indenture to be entered into between Allstate Life Global Funding and J.P. Morgan
Trust Company, National Association (included in Part H to the Form of Series Instrument filed as
Exhibit 4.12 hereto).
4.8 Form of Global Security for Secured Medium Term Notes Program.
4.9 Form of Definitive Security for Secured Medium Term Notes Program.
4.10 Form of Global Security for Allstate Life(R) CoreNotes(R) Program.
4.11 Form of Definitive Security for Allstate Life(R) CoreNotes(R) Program.
4.12 Form of Series Instrument.
4.13 Form of Closing Instrument.
5.1 Opinion of Counsel of Allstate Life Insurance Company.
5.2 Opinion of LeBoeuf, Lamb, Greene & MacRae LLP.
8 Opinion of LeBoeuf, Lamb, Greene & MacRae LLP, as Tax Counsel.
II-10
10.1 Form of Funding Agreement between Allstate Life Insurance Company and Allstate Life Global Funding
(incorporated by reference to Registration Statement (File No. 333-101424)).
10.2 Form of Funding Note related to Secured Medium Term Notes issued under the Allstate Life(R)
CoreNotes(R) Program.
10.3 Form of Funding Note related to Secured Medium Term Notes issued under the Secured Medium Term
Notes Program.
10.4 Form of Amended and Restated Support and Expenses Agreement to be entered into between Allstate
Life Insurance Company and Allstate Life Global Funding.
10.5 Standard Support and Expenses Agreement Terms.
10.6 Form of Support and Expenses Agreement (included in Part C to the Form of Series Instrument filed as
Exhibit 4.12).
10.7 Form of Amended and Restated Administrative Services Agreement to be entered into between Allstate
Life Global Funding and AMACAR Pacific Corp.
10.8 Standard Administrative Services Agreement Terms.
10.9 Form of Administrative Services Agreement of each Issuing Trust to be entered into between each
Issuing Trust and AMACAR Pacific Corp. (included in Part B to the Form of Series Instrument filed as
Exhibit 4.12).
10.10 Form of Amended and Restated Name Licensing Agreement between Allstate Insurance Company and Allstate
Life Global Funding.
10.11 Form of Name Licensing Agreement of each Issuing Trust (included in Part D to the Form of Series Instrument
filed as Exhibit 4.12).
10.12 Standard Name Licensing Agreement Terms.
10.13 Indemnity Agreement, dated as of June 24, 2002, between Allstate Life Global Funding and Wilmington Trust
Company (incorporated by reference to Registration Statement (File No. 333-101424)).
10.14 Form of Amended and Restated Indemnity Agreement to be entered into between Allstate Life Global Funding
and Wilmington Trust Company (incorporated by reference to Registration Statement (File No. 333-112249)).
12 Ratio of Earnings to Fixed Charges of Allstate Life Insurance Company.
23.1 Consent of Independent Registered Public Accounting Firm.
23.2 Consent of Counsel of Allstate Life Insurance Company (included in Exhibit 5.1).
23.3 Consents of LeBoeuf, Lamb, Greene & MacRae LLP.
23.4 Consent of Lord, Bissell & Brook LLP.
23.5 Consent of Richards, Layton & Finger, P.A.
24 Power of Attorney (included as part of the Allstate Life Insurance Company signature pages).
25.1 Statement of Eligibility under the Trust Indenture Act of 1939 of J.P. Morgan Trust Company, National
Association as Indenture Trustee under the Indenture.
25.2 Statement of Eligibility under the Trust Indenture Act of 1939 of J.P. Morgan Trust Company, National
Association as Funding Note Indenture Trustee under the Funding Note Indenture.
II-11
Exhibit 1.1
ALLSTATE LIFE GLOBAL FUNDING
$5,000,000,000
SECURED MEDIUM TERM NOTE PROGRAM
DISTRIBUTION AGREEMENT
[ ], 2006
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
A.G. Edwards & Sons, Inc.
Banc of America Securities LLC
Barclays Capital Inc.
Bear, Stearns & Co. Inc.
Citigroup Global Markets Inc.
Credit Suisse Securities (USA) LLC
Deutsche Bank Securities Inc.
Goldman, Sachs & Co.
Greenwich Capital Markets, Inc.
J.P. Morgan Securities Inc.
Lehman Brothers Inc.
Morgan Stanley & Co. Incorporated
UBS Securities LLC
Wachovia Capital Markets, LLC
Ladies and Gentlemen:
Allstate Life Global Funding, a Delaware statutory trust ("Global
Funding"), formed pursuant to a Trust Agreement, dated June 24, 2002, as
amended, restated or modified from time to time (the "Global Funding Trust
Agreement"), between Wilmington Trust Company, as Delaware trustee (the "Global
Funding Delaware Trustee"), and AMACAR Pacific Corp., as trust beneficial owner,
in connection with the Allstate Life Global Funding Secured Medium Term Note
Program (the "Institutional Program") and the Allstate Life(R) CoreNotes(R)
Program (the "Retail Program" and, together with the Institutional Program, the
"Programs"), confirms its agreement with Merrill Lynch, Pierce, Fenner & Smith
Incorporated and each other institution named on Schedule 1 hereto (each, an
"Agent") with respect to the issue and sale, from time to time by separate and
distinct Delaware statutory trusts formed and beneficially owned by Global
Funding (each, an "Issuing Trust" and, collectively, the "Issuing Trusts"), of
notes due between nine months and thirty years from the date of issuance (the
"Notes"). As of the date
- ------------------------
Allstate Life(R) is a registered service mark of Allstate Insurance Company.
CoreNotes(R) is a registered service mark of Merrill Lynch & Co.
hereof, the Issuing Trusts are authorized to issue collectively up to U.S.
$5,000,000,000 aggregate initial offering price of Notes (or its equivalent as
determined in Section 4(s)).
From time to time, upon the formation of a new Issuing Trust, in connection
with the offer and sale of Notes by such Issuing Trust, upon execution and
delivery by such Issuing Trust and the applicable Agent or Agents of the terms
agreement (the "Terms Agreement") set forth in Part E of the series instrument
to be executed by Global Funding, such Issuing Trust and the applicable Agent or
Agents, among others (the "Series Instrument"), such Issuing Trust shall become
a party hereto in relation to its Notes (the time of such execution and delivery
referred to herein as such Issuing Trust's "Trust Effective Time"), with all the
authority, rights, powers, duties and obligations of an Issuing Trust as if
originally named as an Issuing Trust hereunder. Any agreement, covenant,
acknowledgment, representation or warranty made by an Issuing Trust hereunder
shall be deemed to have been made by each Issuing Trust at its Trust Effective
Time and at the Applicable Time (as defined in the applicable Terms Agreement
for such Issuing Trust, the "Applicable Time") unless another time or times are
specified herein, in which case such specified time or times shall instead
apply.
The Notes of each Issuing Trust will be issued pursuant to an indenture, as
amended or modified from time to time, which will adopt and incorporate the
standard indenture terms (each, an "Indenture" and, collectively, the
"Indentures") between the relevant Issuing Trust and J.P. Morgan Trust Company,
National Association, as indenture trustee (the "Indenture Trustee"). Each
Issuing Trust shall issue only one series of Notes.
Each Issuing Trust will immediately use the proceeds from the sale of its
Notes to purchase a funding note (each a "Funding Note") from Global Funding.
Each Funding Note will be issued pursuant to a funding note indenture, as
amended or modified from time to time, which will adopt and incorporate the
standard funding note indenture terms (each, a "Funding Note Indenture") between
Global Funding and J.P. Morgan Trust Company, National Association, as the
funding note indenture trustee (the "Funding Note Indenture Trustee"). Global
Funding will immediately use the net proceeds received from the sale of the
Funding Note to purchase one or more funding agreements (the "Funding
Agreement(s)") issued by Allstate Life Insurance Company, an Illinois stock life
insurance company (the "Company"). Global Funding will immediately assign
absolutely to, and deposit into the relevant Issuing Trust, the relevant Funding
Agreement(s) and the relevant Funding Note will be surrendered. The Notes of the
Issuing Trust will be secured by the relevant Funding Agreement(s). The Issuing
Trust will immediately collaterally assign, and grant a first priority perfected
security interest in, the Funding Agreement(s) to the Indenture Trustee for the
benefit of the holders of the Notes of the Issuing Trust pursuant to the terms
of the Indenture. In connection with the sale of its Notes, the Issuing Trust
will prepare a Pricing Supplement (the "Pricing Supplement") including or
incorporating by reference a description of the terms of the Notes and the terms
of the offering.
The Agents include those institutions named from time to time in Schedule 1
hereto and any institution appointed as an Agent pursuant to Section 20 below.
If any institution is appointed as an Agent only with respect to the Notes of a
particular Issuing Trust, such institution shall only be an Agent with respect
to Notes of such Issuing Trust.
2
This Agreement specifies the terms and conditions on which Notes may be
sold by an Issuing Trust (i) to one or more Agents as principal for resale to
investors, (ii) directly to investors through the applicable Agent as an agent
of such Issuing Trust in soliciting offers for the purchase of Notes and (iii)
to such other investors in compliance with all applicable securities laws as
such Issuing Trust may determine from time to time.
The Company has registered shares of its common stock with the Securities
and Exchange Commission (the "Commission") pursuant to Section 12(g) of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), on Form 10 under
the 1934 Act. Pursuant to Rule 429 of the rules and regulations of the
Commission under the Securities Act of 1933, as amended (the "1933 Act
Regulations"), the Company and Global Funding have filed with the Commission (i)
a registration statement on Form S-3 (No. 333-129157) and pre-effective
amendment No. 1 thereto under the Securities Act of 1933, as amended (the "1933
Act"), for the registration of the Funding Agreement(s), the Funding Notes, and
the Notes, and the offering thereof in accordance with Rule 415 of the 1933 Act
Regulations; (ii) the related prospectus dated [ ], 2006 covering the Notes
offered under the Programs (the "Base Prospectus"); (iii) the prospectus
supplement to the Base Prospectus, dated [ ], 2006, covering the Notes offered
under the Institutional Program (the "Institutional Prospectus Supplement" and
together with the Base Prospectus, the "Institutional Base Prospectus"); and
(iv) the prospectus supplement to the Base Prospectus, dated [ ], 2006, covering
the Notes offered under the Retail Program (the "Retail Prospectus Supplement"
and, together with the Base Prospectus, the "Retail Base Prospectus"). Such
registration statement (as so amended, if applicable), is also the first
post-effective amendment to registration statement on Form S-3 (No. 333-125937)
filed by the Company and Global Funding. The registration statement on Form S-3
(No. 333-129157) (as so amended, if applicable) has been declared effective by
the Commission, and the form of Indenture and the form of Funding Note Indenture
have been duly qualified under the Trust Indenture Act of 1939, as amended (the
"1939 Act"), and the Company and Global Funding have filed such post-effective
amendments thereto as may be required prior to the acceptance by Global Funding
and any Issuing Trust of any offer for the purchase of Notes and each such
post-effective amendment has been declared effective by the Commission. Such
registration statement on Form S-3 (No. 333-129157), at any relevant time,
including the amendments thereto to such time, the exhibits and any schedules
thereto at such time, the documents incorporated by reference therein pursuant
to Item 12 of Form S-3 under the 1933 Act at such time and the documents
otherwise deemed to be a part thereof or included therein by the 1933 Act
Regulations is referred to herein as the "Registration Statement". If the
Company or Global Funding file a registration statement with the Commission
pursuant to Rule 462(b) of the 1933 Act Regulations (the "Rule 462(b)
Registration Statement"), then, after such filing, all references to the
"Registration Statement" shall also be deemed to include the Rule 462(b)
Registration Statement. With respect to the offering of a series of Notes under
the Institutional Program, the Institutional Base Prospectus, and with respect
to the offering of a series of Notes under the Retail Program, the Retail Base
Prospectus, in each case including the Pricing Supplement relating to the
offering of such series of Notes, in the form first filed with the Commission
pursuant to Rule 424(b) of the 1933 Act Regulations (or in the form first made
available to the applicable Agent(s) by the Company and the applicable Issuing
Trust to meet requests of purchasers pursuant to Rule 173 under the 1933 Act
Regulations), are referred to herein as the "Prospectus." The term "preliminary
prospectus" means any preliminary form of the Prospectus. For all purposes of
this Agreement, the term "free writing prospectus" has
3
the meaning set forth in Rule 405 under the 1933 Act Regulations and the term
"Time of Sale Prospectus" means (i) with respect to the offer and sale of any
series of Notes under the Institutional Program, the Institutional Base
Prospectus and (ii) with respect to the offer and sale of any series of Notes
under the Retail Program, the Retail Base Prospectus in each case as amended or
supplemented from time to time, together with any other preliminary prospectus
relating to the offer and sale of such series of Notes, any Pricing Supplement
relating to the offer and sale of such series of Notes filed with the Commission
prior to the Applicable Time and each free writing prospectus (including any
final term sheet relating to such series of Notes) attached as, or identified
in, Exhibit A to the applicable Terms Agreement and any other information
identified in Exhibit A to the applicable Terms Agreement. All references to the
"Registration Statement", the "Institutional Base Prospectus", the "Retail Base
Prospectus", any "preliminary prospectus", the "Time of Sale Prospectus" and the
"Prospectus" shall also be deemed to include all amendments and supplements
thereto and all documents incorporated by reference therein. For purposes of
this Agreement, all references to the Registration Statement, Time of Sale
Prospectus, Prospectus, any preliminary prospectus or free writing prospectus,
or to any amendment or supplement thereto shall be deemed to include any copy
filed with the Commission pursuant to its Electronic Data Gathering, Analysis
and Retrieval system ("EDGAR").
All references in this Agreement to financial statements and schedules and
other information which is "disclosed", "contained", "included" or "stated" (or
other references of like import) in the Registration Statement, Time of Sale
Prospectus, Prospectus, any preliminary prospectus or free writing prospectus
shall be deemed to include all such financial statements and schedules and other
information which is incorporated by reference in or otherwise deemed by the
1933 Act Regulations to be a part of or included in the Registration Statement,
Time of Sale Prospectus, Prospectus, any preliminary prospectus or free writing
prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement, Time of Sale
Prospectus, Institutional Base Prospectus, Retail Base Prospectus, Prospectus,
any preliminary prospectus or free writing prospectus shall be deemed to include
all documents subsequently filed with the Commission pursuant to the 1934 Act
which are incorporated by reference in or otherwise deemed by the 1933 Act
Regulations to be part of or included in the Registration Statement, Time of
Sale Prospectus, Institutional Base Prospectus, Retail Base Prospectus,
Prospectus, any preliminary prospectus or free writing prospectus, as the case
may be.
SECTION 1. Appointment as Agent.
(a) Appointment. Subject to the terms and conditions stated herein, Global
Funding and the relevant Issuing Trust hereby agree that the Notes of such
Issuing Trust will be sold to or through the Agents pursuant to the terms of
this Agreement. Global Funding and the relevant Issuing Trust agree that they
will not appoint any other agents to act on an Issuing Trust's behalf or to
assist an Issuing Trust, in the placement of the Notes; provided, however that
with respect to transactions in which the sales of Notes will be targeted to
institutional purchasers under the Institutional Program, Global Funding and an
Issuing Trust may enter into arrangements with other agent(s) not a party to
this Agreement provided that such agent(s) enter into an agreement with terms
substantially identical to those contained herein. Global Funding and each
Issuing Trust agree that they hereby appoint only Merrill Lynch, Pierce, Fenner
& Smith Incorporated
4
(the "Purchasing Agent") to act on an Issuing Trust's behalf or to assist an
Issuing Trust in connection with transactions in which the sale of Notes will be
targeted to retail purchasers under the Retail Program. For purposes of this
Agreement, all references to any Agent shall be deemed to include the Purchasing
Agent.
(b) Sale of Notes. Each Issuing Trust shall not sell or approve the
solicitation of offers for the purchase of Notes in excess of the aggregate
initial offering price of Notes registered pursuant to the Registration
Statement. The Agents shall have no responsibility for maintaining records with
respect to the aggregate initial offering price of Notes sold, or of otherwise
monitoring the availability of Notes for sale, under the Registration Statement.
(c) Purchases as Principal. The Agents shall not have any obligation to
purchase Notes issued through any Issuing Trust as principal. However, absent an
agreement by and between Global Funding and the relevant Issuing Trust, on the
one hand, and an Agent, on the other hand, for such Agent to act as an agent for
the relevant Issuing Trust, such Agent shall be deemed to be acting as principal
in connection with any offering of Notes by such Issuing Trust. Accordingly, the
Agents, individually or in a syndicate, may agree from time to time to purchase
Notes from an Issuing Trust as principal for resale to investors determined by
such Agents. Any purchase of Notes from an Issuing Trust by an Agent as
principal shall be made in accordance with Section 3(a) hereof.
(d) Solicitations as Agent. If agreed upon between an Agent, on the one
hand, and Global Funding and an Issuing Trust, on the other hand, then such
Agent, acting solely as an agent for such Issuing Trust and not as principal,
will solicit offers for the purchase of Notes. Such Agent will communicate to
such Issuing Trust, orally, each offer for the purchase of Notes solicited by it
on an agency basis other than those offers rejected by such Agent. Such Agent
shall have the right, in its discretion reasonably exercised, to reject any
offer for the purchase of Notes, in whole or in part, and any such rejection
shall not be deemed a breach of its agreement contained herein. Such Issuing
Trust may accept or reject any offer for the purchase of Notes, in whole or in
part. Such Agent shall make reasonable efforts to assist such Issuing Trust in
obtaining performance by each purchaser whose offer for the purchase of Notes
has been solicited by it on an agency basis and accepted by such Issuing Trust.
Such Agent shall not have any liability to such Issuing Trust in the event that
any such purchase is not consummated for any reason. If such Issuing Trust shall
default on its obligation to deliver Notes to a purchaser whose offer has been
solicited by an Agent on an agency basis and accepted by such Issuing Trust,
then (i) such Issuing Trust shall hold such Agent harmless against any loss,
claim or damage arising from or as a result of such default by such Issuing
Trust and (ii) the Issuing Trust shall be responsible to pay to such Agent any
commission to which such Agent would otherwise be entitled absent such default.
(e) Reliance. Each Issuing Trust and Global Funding, on the one hand, and
the Agents, on the other hand, agree that any Notes purchased from an Issuing
Trust by one or more Agents as principal shall be purchased, and any Notes the
placement of which an Agent arranges as an agent of such Issuing Trust shall be
placed by such Agent, in reliance on the representations, warranties, covenants
and agreements of Global Funding and such Issuing Trust contained herein and on
the terms and conditions and in the manner provided herein.
5
SECTION 2. Representations and Warranties.
(a) Representations and Warranties of Global Funding. Global Funding
represents and warrants to each Agent as of the date hereof, to the applicable
Agent(s) as of the Applicable Time for the relevant Issuing Trust, to the
applicable Agent(s) as of the date of each delivery of Notes (whether to such
Agent as principal or through such Agent as agent) (the date of each such
delivery is referred to herein as a "Settlement Date"), to each Agent as of any
time the Time of Sale Prospectus shall be amended or supplemented and to each
Agent as of any time that the Registration Statement or the Prospectus shall be
amended or supplemented (each of the times referenced above is referred to
herein as a "Global Funding Representation Date"), as follows:
(i) Due Formation and Good Standing of Global Funding. Global Funding
is a statutory trust, duly formed under Delaware law pursuant to the Global
Funding Trust Agreement and the filing of a certificate of trust with the
Delaware Secretary of State, which is validly existing and in good standing
as a statutory trust under the laws of the State of Delaware.
(ii) Registration Statement, Preliminary Prospectuses, Time of Sale
Prospectus, and Prospectus; Filing Status. Global Funding meets the
requirements for use of Form S-3 under the 1933 Act; the Registration
Statement has become effective under the 1933 Act and no stop order
suspending the effectiveness of the Registration Statement has been issued
under the 1933 Act and no proceedings for that purpose have been instituted
or are pending or, to the knowledge of Global Funding, are contemplated by
the Commission, and any request on the part of the Commission for
additional information has been complied with; the form of Indenture has
been duly qualified under the 1939 Act; the form of Funding Note Indenture
has been duly qualified under the 1939 Act; at the respective times that
each part of the Registration Statement became effective and at each Global
Funding Representation Date, the Registration Statement complied and will
comply in all material respects with the requirements of the 1933 Act and
the 1933 Act Regulations, the 1934 Act and the rules and regulations of the
Commission under the 1934 Act (the "1934 Act Regulations") and the 1939 Act
and the rules and regulations of the Commission under the 1939 Act (the
"1939 Act Regulations") and did not 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; each preliminary prospectus and Prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act Regulations,
complied when so filed in all material respects with the 1933 Act and the
1933 Act Regulations; each preliminary prospectus and the Prospectus
delivered to an Agent for use in connection with the offering of Notes are
identical in all material respects to any electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T; and at the date hereof, at the date of the
Base Prospectus and each amendment or supplement thereto and at each Global
Funding Representation Date, neither the Base Prospectus nor any amendment
or supplement thereto included or will include an untrue statement of a
material fact or omitted or will omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The Time of Sale Prospectus
does not, and at the Applicable
6
Time and at the applicable Settlement Date, the Time of Sale Prospectus, as
then amended or supplemented by Global Funding, if applicable, will not
contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that the representations and warranties in this subsection shall
not apply to (i) statements in or omissions from the Registration
Statement, the Base Prospectus, the Time of Sale Prospectus or the
Prospectus made in reliance upon and in conformity with information
furnished to Global Funding in writing by the applicable Agents concerning
such Agents expressly for use in the Registration Statement, the Base
Prospectus, the Time of Sale Prospectus or the Prospectus or (ii) the parts
of the Registration Statement which constitute the Statement of Eligibility
and Qualification (Form T-1) of the Indenture Trustee and the Funding Note
Indenture Trustee under the 1939 Act.
(iii) Incorporated Documents; 1934 Act Filings. The documents
incorporated or deemed to be incorporated by reference in the Time of Sale
Prospectus or the Base Prospectus, as amended or supplemented, at the time
they were or hereafter are filed with the Commission, complied and will
comply in all material respects with the requirements of the 1934 Act and
the 1934 Act Regulations and, when read together with the other information
in the Time of Sale Prospectus or the Base Prospectus, at the date hereof,
at the date of the Time of Sale Prospectus or the Base Prospectus and at
each Global Funding Representation Date, did not and will not include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. Any reports,
filings or other documents, exhibits or schedules filed by Global Funding
and each Issuing Trust pursuant to the 1934 Act comply in all material
respects with the requirements of the 1934 Act and the 1934 Act
Regulations.
(iv) Free Writing Prospectuses. At the time of initial filing of the
Registration Statement, at the earliest time thereafter that Global Funding
or another offering participant made a bona fide offer (within the meaning
of Rule 164(h)(2) of the 1933 Act Regulations) of any Notes and at each
Global Funding Representation Date, Global Funding was not and is not an
"ineligible issuer," as defined in Rule 405 of the 1933 Act Regulations.
Any free writing prospectus that Global Funding is required to file
pursuant to Rule 433(d) under the 1933 Act Regulations has been, or will
be, filed with the Commission in accordance with the requirements of the
1933 Act and the 1933 Act Regulations. Each free writing prospectus that
Global Funding has filed, or is required to file, pursuant to Rule 433(d)
under the 1933 Act Regulations or that was prepared by or on behalf of or
used by Global Funding complies or will comply in all material respects
with the requirements of the applicable 1933 Act Regulations. Except with
respect to the offering of any series of Notes, the free writing
prospectuses attached as, or identified in, Exhibit A to the applicable
Terms Agreement, Global Funding and the Issuing Trusts have not prepared,
used or referred to, and will not, without the prior consent of the
applicable Agents, prepare, use or refer to, any free writing prospectus or
any other marketing materials other than the preliminary prospectus
relating to or to be used in connection with any offer or sale of the
Notes. No free writing prospectus used in
7
connection with the offering of a series of Notes will conflict with either
the Registration Statement or the Base Prospectus.
(v) Independent Registered Public Accounting Firm. The accounting firm
which certified the financial statements and any supporting schedules
thereto included in the Registration Statement and the Base Prospectus, as
amended or supplemented, is an independent registered public accounting
firm to the extent required by the 1933 Act and the 1933 Act Regulations.
(vi) Global Funding Financial Statements. The consolidated financial
statements of Global Funding, if any, included in any report or filing
under the 1934 Act, together with the related schedules and notes present
fairly the consolidated financial position of Global Funding at the dates
indicated to the extent required under the 1934 Act; such financial
statements have been prepared in conformity with generally accepted
accounting principles ("GAAP") applied on a consistent basis throughout the
periods involved; the supporting schedules, if any, present fairly in
accordance with GAAP the information required to be stated therein; the
selected financial data and the summary financial information included in
the Registration Statement and the Time of Sale Prospectus present fairly
the information shown therein.
(vii) No Material Changes. Since the respective dates as of which
information is given in the Registration Statement and the Time of Sale
Prospectus, except as otherwise stated therein, (1) there has been no event
or occurrence that would result in a material adverse effect on the
condition (financial or otherwise) of Global Funding or on the power or
ability of Global Funding to perform its obligations under this Agreement,
the Global Funding Trust Agreement, any Funding Note or the Administrative
Services Agreement (the "Global Funding Administration Agreement"), dated
June 24, 2002, as amended, restated or modified from time to time, between
the Global Funding Delaware Trustee, on behalf of Global Funding, and
AMACAR Pacific Corp., as administrator (the "Global Funding
Administrator"), or to consummate the transactions to be performed by it as
contemplated in the Time of Sale Prospectus (a "Global Funding Material
Adverse Effect") and (2) there have been no transactions entered into by
Global Funding, other than those in the ordinary course of business, which
are material with respect to Global Funding.
(viii) Authorization of this Agreement, each Funding Agreement, Global
Funding Trust Agreement, Global Funding Administration Agreement, the
Funding Note Indenture and the Funding Notes. This Agreement, the Global
Funding Trust Agreement and Global Funding Administration Agreement have
been, and each Funding Note Indenture, Funding Note and relevant Funding
Agreement will be, duly authorized, executed and delivered by Global
Funding and this Agreement, each relevant Funding Agreement, the Global
Funding Trust Agreement, the Global Funding Administration Agreement, the
Funding Note Indenture and the Funding Notes will each be a valid and
legally binding agreement of Global Funding enforceable against Global
Funding in accordance with its terms, as applicable, except as enforcement
thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors'
rights generally or by general equitable principles (regardless
8
of whether enforcement is considered in a proceeding in equity or at law),
and except further as enforcement thereof may be limited by requirements
that a claim with respect to any Funding Note that is payable in a foreign
or composite currency (or a foreign or composite currency judgment in
respect of such claim) be converted into U.S. dollars at a rate of exchange
prevailing on a date determined pursuant to applicable law or by
governmental authority to limit, delay or prohibit the making of payments
outside the United States. The holder of the Funding Notes will be entitled
to the benefits of the Funding Note Indenture.
(ix) Absence of Defaults and Conflicts. Global Funding is not in
violation of its certificate of trust or in default in the performance or
observance of any obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, loan or credit agreement, note, lease or
other agreement or instrument to which Global Funding is a party or by
which it may be bound or to which any of the property or assets of Global
Funding is subject (the "Global Funding Agreements and Instruments"),
except for such violations or defaults that would not result in a Global
Funding Material Adverse Effect; and the execution, delivery and
performance of this Agreement, the Global Funding Trust Agreement, the
Funding Agreement(s), Global Funding Administration Agreement and each
Funding Note and any other agreement or instrument entered into or issued
or to be entered into or issued by Global Funding in connection with the
transactions contemplated by the Time of Sale Prospectus (collectively, the
"Global Funding Program Documents"), the consummation of the transactions
contemplated in the Time of Sale Prospectus (including the issuance and
sale of the Notes by an Issuing Trust and the use of proceeds therefrom as
described in the Time of Sale Prospectus) and the compliance by Global
Funding with its obligations hereunder and under Global Funding Program
Documents, have been duly authorized by all necessary action and do not and
will not, whether with or without the giving of notice or the passage of
time or both, conflict with or constitute a breach of, or default or event
or condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such holder's behalf) the
right to require the repurchase, redemption or repayment of all or a
portion of such indebtedness by Global Funding under, or result in the
creation or imposition of any lien, charge or encumbrance upon any assets,
properties or operations of any Issuing Trust or Global Funding pursuant
to, any Global Funding Agreements and Instruments, nor will such action
result in any violation of Global Funding's certificate of trust, the
Global Funding Trust Agreement or Global Funding Administration Agreement
which may reasonably be expected to result in a Global Funding Material
Adverse Effect and Global Funding is not in default in the performance or
observance of any applicable law, statute, rule, regulation, judgment,
order, writ or decree of any government, government instrumentality or
court, domestic or foreign, having jurisdiction over Global Funding or any
of its assets, properties or operations, except for such defaults which
would not reasonably be expected to result in a Global Funding Material
Adverse Effect.
(x) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or to the knowledge of
Global Funding threatened, against or affecting Global Funding which is
required to be disclosed in the Registration Statement and the Base
Prospectus, as amended or supplemented (other than as stated therein), or
9
which may reasonably be expected to result in a Global Funding Material
Adverse Effect; and the aggregate of all pending legal or governmental
proceedings to which Global Funding is a party or of which any of its
assets, properties or operations is the subject which are not described in
the Registration Statement and the Base Prospectus, as amended or
supplemented, including ordinary routine litigation incidental to the
business, may not reasonably be expected to result in a Global Funding
Material Adverse Effect.
(xi) Possession of Licenses and Permits. Global Funding possesses such
permits, licenses, approvals, consents and other authorizations
(collectively, "Governmental Licenses") issued by the appropriate federal,
state, local or foreign regulatory agencies or bodies necessary to conduct
the business now operated by it; Global Funding is in compliance with the
terms and conditions of all such Governmental Licenses, except where the
failure so to comply would not, singly or in the aggregate, result in a
Global Funding Material Adverse Effect; all of the Governmental Licenses
are valid and in full force and effect, except where the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses to be in
full force and effect would not result in a Global Funding Material Adverse
Effect. Except as set forth in the Time of Sale Prospectus, Global Funding
has not received any notice of proceedings relating to the revocation or
modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding,
would result in a Global Funding Material Adverse Effect.
(xii) No Filings, Regulatory Approvals etc. No filing with, or
approval, authorization, consent, license, registration, qualification,
order or decree of, any court or governmental authority or agency, domestic
or foreign, is necessary or required for the due authorization, execution
and delivery by Global Funding of Global Funding Program Documents or for
the performance by Global Funding of the transactions contemplated in
Global Funding Program Documents, except such as have been previously made,
obtained or rendered, as applicable.
(xiii) Investment Company Act. Neither Global Funding nor any Issuing
Trust is, and upon any sale of Funding Notes and the Notes as herein
contemplated and the application of the net proceeds therefrom as described
in the Time of Sale Prospectus, will not be an "investment company" within
the meaning of the Investment Company Act of 1940, as amended (the "1940
Act").
(xiv) Ratings. The Programs are (A) expected to be rated Aa2 by
Moody's Investors Service, Inc. ("Moody's") and (B) rated AA by Standard &
Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc.
("Standard & Poor's") (Moody's and Standard & Poor's are referred to herein
as the "Ratings Agencies"), or, in each case, such other rating as to which
Global Funding shall have most recently notified the Agents pursuant to
Section 4(u) hereof.
(xv) Notes Listed on any Stock Exchange. If specified in a Pricing
Supplement, the Notes described in such Pricing Supplement shall be listed
on the securities exchange designated in the Pricing Supplement.
10
(xvi) Relationship between Global Funding and the Agents. Global
Funding acknowledges and agrees that (i) the purchase and sale of the Notes
pursuant to this Agreement, including the determination of the offering
price of the Notes and any related discounts and commissions, is an
arm's-length commercial transaction between Global Funding, on the one
hand, and the several Agents, on the other hand, (ii) in connection with
the offerings contemplated hereby and the process leading to such
transactions each Agent is and has been acting solely as a principal and is
not the agent or fiduciary of Global Funding, or its stockholders,
creditors, employees or any other party, (iii) no Agent has assumed or will
assume an advisory or fiduciary responsibility in favor of Global Funding
with respect to the offerings contemplated hereby or the process leading
thereto (irrespective of whether such Agent has advised or is currently
advising Global Funding on other matters) and no Agent has any obligation
to Global Funding with respect to the offerings contemplated hereby except
the obligations expressly set forth in this Agreement, (iv) the Agents and
their respective affiliates may be engaged in a broad range of transactions
that involve interests that differ from those of Global Funding, and (v)
the Agents have not provided any legal, accounting, regulatory or tax
advice with respect to the offerings contemplated hereby and Global Funding
has consulted its own legal, accounting, regulatory and tax advisors to the
extent it deemed appropriate.
(b) Representations and Warranties of the relevant Issuing Trust. Each
Issuing Trust represents and warrants, only as to itself, to each applicable
Agent as of the such Issuing Trust's Trust Effective Time, as of its Applicable
Time and as of the date of each delivery of its Notes (whether to each such
Agent as principal or through each such Agent as agent) (the date of each such
delivery is referred to herein as a "Settlement Date") (each of the times
referenced above is referred to herein as an "Issuing Trust Representation
Date"), as follows:
(i) Due Formation and Good Standing of the Issuing Trust. Such Issuing
Trust is a statutory trust, duly formed under Delaware law pursuant to the
trust agreement between Wilmington Trust Company, as Delaware trustee (the
"Relevant Issuing Trust Trustee") and Global Funding (the "Issuing Trust
Agreement") and the filing of a certificate of trust with the Delaware
Secretary of State, which is validly existing and in good standing as a
statutory trust under the laws of the State of Delaware.
(ii) No Material Changes. Since the respective dates as of which
information is given in the Registration Statement and the Time of Sale
Prospectus or the Trust Effective Time, whichever is later, except as
otherwise stated therein, (1) there has been no event or occurrence that
would result in a material adverse effect on the condition (financial or
otherwise) of such Issuing Trust or on the power or ability of such Issuing
Trust to perform its obligations under this Agreement, the Issuing Trust
Agreement, its Notes, any Funding Agreement, the Indenture or the Issuing
Trust Administrative Services Agreement (the "Issuing Trust Administration
Agreement"), as amended or modified from time to time, between the Relevant
Issuing Trust Trustee, on behalf of such Issuing Trust, and AMACAR Pacific
Corp., as administrator (the "Issuing Trust Administrator"), or to
consummate the transactions to be performed by it as contemplated in the
Time of Sale Prospectus (an "Issuing Trust Material Adverse Effect") and
(2) there have been no transactions entered into by such Issuing Trust,
other
11
than those in the ordinary course of business, which are material with
respect to such Issuing Trust.
(iii) Authorization of this Agreement, the Issuing Trust Agreement,
the Issuing Trust Administration Agreement, the Indenture and the Notes.
This Agreement, the Issuing Trust Agreement, the Issuing Trust
Administration Agreement and the relevant Indenture have been or will be,
duly authorized, executed and delivered by such Issuing Trust and each is
or will be a valid and legally binding agreement of the Issuing Trust
enforceable against the Issuing Trust in accordance with its terms, as
applicable, except as enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally or by general equitable
principles (regardless of whether enforcement is considered in a proceeding
in equity or at law), and except further as enforcement thereof may be
limited by requirements that a claim with respect to any Notes issued under
the Indenture that are payable in a foreign or composite currency (or a
foreign or composite currency judgment in respect of such claim) be
converted into U.S. dollars at a rate of exchange prevailing on a date
determined pursuant to applicable law or by governmental authority to
limit, delay or prohibit the making of payments outside the United States;
the Notes have been duly authorized by such Issuing Trust for offer, sale,
issuance and delivery pursuant to this Agreement and, when issued,
authenticated and delivered in the manner provided for in the Indenture and
delivered against payment of the consideration therefor, will constitute
valid and legally binding obligations of such Issuing Trust, enforceable
against such Issuing Trust in accordance with their terms, except as
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement
of creditors' rights generally or by general equitable principles
(regardless of whether enforcement is considered in a proceeding in equity
or at law); the Notes will be substantially in a form previously certified
to the Agents and contemplated by the Indenture; and each holder of Notes
will be entitled to the benefits set forth in the Indenture.
(iv) Absence of Defaults and Conflicts. Such Issuing Trust is not in
violation of its certificate of trust or in default in the performance or
observance of any obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, loan or credit agreement, note, lease or
other agreement or instrument to which such Issuing Trust is a party or by
which it may be bound or to which any of the property or assets of such
Issuing Trust is subject (the "Issuing Trust Agreements and Instruments"),
except for such violations or defaults that would not result in an Issuing
Trust Material Adverse Effect; and the execution, delivery and performance
of this Agreement, the Issuing Trust Agreement, the Issuing Trust
Administration Agreement, its Notes and the Indenture and any other
agreement or instrument entered into or issued or to be entered into or
issued by such Issuing Trust in connection with the transactions
contemplated by the Time of Sale Prospectus, the consummation of the
transactions contemplated in the Time of Sale Prospectus (including the
issuance and sale of the Notes by an Issuing Trust and the use of proceeds
therefrom as described in the Time of Sale Prospectus) (collectively, the
"Issuing Trust Program Documents") and the compliance by such Issuing Trust
with its obligations hereunder and under the Issuing Trust Program
Documents, have been duly authorized by all necessary action and do not and
will not,
12
whether with or without the giving of notice or the passage of time or
both, conflict with or constitute a breach of, or default or event or
condition which gives the holder of any note, debenture or other evidence
of indebtedness (or any person acting on such holder's behalf) the right to
require the repurchase, redemption or repayment of all or a portion of such
indebtedness by such Issuing Trust under, or result in the creation or
imposition of any lien, charge or encumbrance upon any assets, properties
or operations of any Issuing Trust or such Issuing Trust pursuant to, any
Issuing Trust Agreements and Instruments, nor will such action result in
any violation of such Issuing Trust's certificate of trust, the Issuing
Trust Agreement or the Issuing Trust Administration Agreement which may
reasonably be expected to result in an Issuing Trust Material Adverse
Effect and such Issuing Trust is not in default in the performance or
observance of any applicable law, statute, rule, regulation, judgment,
order, writ or decree of any government, government instrumentality or
court, domestic or foreign, having jurisdiction over such Issuing Trust or
any of its assets, properties or operations, except for such defaults which
would not reasonably be expected to result in an Issuing Trust Material
Adverse Effect.
(v) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or to the knowledge of
such Issuing Trust threatened, against or affecting such Issuing Trust
which is required to be disclosed in the Registration Statement and the
Base Prospectus, as amended or supplemented (other than as stated therein),
or which may reasonably be expected to result in an Issuing Trust Material
Adverse Effect; and the aggregate of all pending legal or governmental
proceedings to which such Issuing Trust is a party or of which any of its
assets, properties or operations is the subject which are not described in
the Registration Statement and the Time of Sale Prospectus, including
ordinary routine litigation incidental to the business, may not reasonably
be expected to result in an Issuing Trust Material Adverse Effect.
(vi) Possession of Licenses and Permits. Such Issuing Trust possesses
such Governmental Licenses issued by the appropriate federal, state, local
or foreign regulatory agencies or bodies necessary to conduct the business
now operated by it; such Issuing Trust is in compliance with the terms and
conditions of all such Governmental Licenses, except where the failure so
to comply would not, singly or in the aggregate, result in an Issuing Trust
Material Adverse Effect; all of the Governmental Licenses are valid and in
full force and effect, except where the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force
and effect would not result in an Issuing Trust Material Adverse Effect.
Except as otherwise set forth in the Time of Sale Prospectus, such Issuing
Trust has not received any notice of proceedings relating to the revocation
or modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding,
would result in an Issuing Trust Material Adverse Effect.
(vii) No Filings, Regulatory Approvals etc. Other than the filing of
the applicable financing statements, if any, no filing with, or approval,
authorization, consent, license, registration, qualification, order or
decree of, any court or governmental authority or agency, domestic or
foreign, is necessary or required for the due authorization, execution and
delivery by such Issuing Trust of the Issuing Trust Program
13
Documents or for the performance by such Issuing Trust of the transactions
contemplated in the Issuing Trust Program Documents, except such as have
been previously made, obtained or rendered, as applicable.
(viii) Investment Company Act. Such Issuing Trust is not, and upon any
sale of Notes by such Issuing Trust as herein contemplated and the
application of the net proceeds therefrom as described in the Time of Sale
Prospectus will not be, an "investment company" within the meaning of the
1940 Act.
(ix) Notes Listed on any Stock Exchange. If specified in a Pricing
Supplement, such Issuing Trust's Notes described in such Pricing Supplement
shall be listed on the securities exchange designated in the Pricing
Supplement.
(c) Additional Certifications. Any certificate signed by any officer of the
Global Funding Delaware Trustee, on behalf of Global Funding or any officer of
the Delaware Issuing Trustee, on behalf of the applicable Issuing Trust, and
delivered to one or more Agents or to counsel for the Agents in connection with
an offering of Notes to one or more Agents as principal or through an Agent as
agent shall be deemed a representation and warranty by Global Funding or Issuing
Trust (as applicable) to such Agent(s) as to the matters covered thereby on the
date of such certificate and, unless subsequently amended or supplemented, at
each Representation Date subsequent thereto.
SECTION 3. Purchases as Principal; Solicitations as Agent; Other Sales.
(a) Purchases as Principal. Notes purchased from an Issuing Trust by the
Agents, individually or in a syndicate, as principal shall be made in accordance
with terms agreed upon between such Agent(s), on one hand, and Global Funding
and such Issuing Trust, on the other hand, specified in the Terms Agreement. An
Agent's commitment to purchase Notes as principal shall be deemed to have been
made on the basis of the representations and warranties of Global Funding and
Issuing Trust herein contained and shall be subject to the terms and conditions
herein set forth. Unless the context otherwise requires, references herein to
"this Agreement" shall include the applicable Terms Agreement Each purchase of
Notes by Merrill Lynch, Pierce, Fenner & Smith Incorporated, as the Purchasing
Agent, unless otherwise agreed, shall be at a discount from the principal amount
of each such Note equivalent to the applicable commission set forth in Schedule
2 hereto. Any other purchase of Notes, unless otherwise agreed, shall be at a
discount from the principal amount of each such Note equivalent to the
applicable commission set forth in Schedule 3 hereto. The Agents may engage the
services of any broker or dealer in connection with the resale of the Notes
purchased by them as principal and may allow all or any portion of the discount
received by them in connection with such purchases to any broker or dealer.
If Global Funding and an Issuing Trust, on one hand, and two or more
Agents, on the other hand, enter into a Terms Agreement pursuant to which such
Agents agree to purchase Notes from such Issuing Trust as principal and one or
more of such Agents shall fail at the Settlement Date to purchase the Notes
which it or they are obligated to purchase (the "Defaulted Notes"), then the
nondefaulting Agents shall have the right, within 24 hours thereafter, to make
arrangements for one of them or one or more other Agents or underwriters to
purchase all, but not less than all, of the
14
Defaulted Notes in such amounts as may be agreed upon and upon the terms herein
set forth; provided, however, that if such arrangements shall not have been
completed within such 24-hour period, then:
(i) if the aggregate principal amount of Defaulted Notes does not
exceed 10% of the aggregate principal amount of Notes to be so purchased by
all of such Agents on the Settlement Date, the nondefaulting Agents shall
be obligated, severally and not jointly, to purchase the full amount
thereof in the proportions that their respective initial underwriting
obligations bear to the underwriting obligations of all nondefaulting
Agents; or
(ii) if the aggregate principal amount of Defaulted Notes exceeds 10%
of the aggregate principal amount of Notes to be so purchased by all of
such Agents on the Settlement Date, such agreement shall terminate without
liability on the part of any nondefaulting Agent.
No action taken pursuant to this paragraph shall relieve any defaulting
Agent from liability in respect of its default. In the event of any such default
which does not result in a termination of such Terms Agreement, either the
nondefaulting Agents, on one hand, or Global Funding and such Issuing Trust, on
the other hand, shall have the right to postpone the Settlement Date for a
period not exceeding seven days in order to effect any required changes in the
Registration Statement, the Time of Sale Prospectus or the Prospectus or in any
other documents or arrangements.
(b) Solicitations as Agent. On the basis of the representations and
warranties herein contained, but subject to the terms and conditions herein set
forth, when agreed by an Issuing Trust, on one hand, and an Agent, on the other
hand, such Agent, as an agent of the such Issuing Trust, will use its reasonable
efforts to solicit offers for the purchase of such Issuing Trust's Notes upon
the terms set forth in the Registration Statement. Unless the context otherwise
requires, references herein to "this Agreement" shall include the applicable
Terms Agreement. Such Agent is authorized to appoint any sub-agent with respect
to solicitations of offers to purchase Notes; provided, however, that any such
appointment of a sub-agent shall be subject to the prior consent of the Company
and such Issuing Trust. All Notes sold through such Agent as agent will be sold
at one hundred percent (100%) of their principal amount unless otherwise agreed
upon between the relevant Issuing Trust, on one hand, and such Agent, on the
other hand.
An Issuing Trust reserves the right, in its sole discretion, to suspend
solicitation of offers for the purchase of Notes through an Agent, as an agent
of such Issuing Trust, commencing at any time for any period of time or
permanently. As soon as practicable after receipt of instructions from such
Issuing Trust, such Agent will suspend solicitation of offers for the purchase
of Notes issued through such Issuing Trust until such time as such Issuing Trust
has advised such Agent that such solicitation may be resumed.
Each Issuing Trust agrees to pay Merrill Lynch, Pierce, Fenner & Smith
Incorporated, for acting as the Purchasing Agent, as consideration for
soliciting offers to purchase its Notes as an agent of such Issuing Trust, a
commission, in the form of a discount, equal to the applicable percentage of the
principal amount of each Note sold by such Issuing Trust as a result of any such
solicitation made by the Purchasing Agent, as set forth in Schedule 2 hereto.
15
Each Issuing Trust agrees to pay the Agent, as consideration for soliciting
offers to purchase Notes as an agent of such Issuing Trust, a commission, in the
form of a discount, equal to the applicable percentage of the principal amount
of each Note sold by such Issuing Trust as a result of any such solicitation
made by such Agent, as set forth in Schedule 3 hereto.
(c) Administrative Procedures. The purchase price, interest rate or
formula, maturity date and other terms of the Notes shall be agreed upon between
Global Funding and the relevant Issuing Trust, on one hand, and the applicable
Agent(s), on the other hand, and specified in a Pricing Supplement prepared in
connection with each sale of Notes. Except as otherwise specified in the
applicable Pricing Supplement, the Notes will be issued in denominations of U.S.
$1,000 or any larger amount that is an integral multiple of U.S. $1,000.
Administrative procedures with respect to the issuance and sale of the Notes
(the "Administrative Procedures") shall be agreed upon from time to time among
Global Funding, the relevant Issuing Trust, the Agent(s), the relevant Issuing
Trust Administrator and the Indenture Trustee. The Agents, Global Funding and
each Issuing Trust agree to perform and Global Funding agrees to cause the
Company, and the Issuing Trust agrees to cause the Issuing Trust Administrator
and the Indenture Trustee to agree to perform, their respective duties and
obligations specifically provided to be performed by them in the Administrative
Procedures.
(d) Obligations Several. Global Funding and each Issuing Trust acknowledge
that the obligations of the Agents under this Agreement are several and not
joint.
(e) Other Sales. Subject to the terms and conditions of Sections 1(a), 4(n)
and 4(o), Global Funding and each Issuing Trust reserves the right, to be
exercised in their sole discretion, to sell Notes of such Issuing Trust, in
compliance with all applicable securities laws, to other investors without the
assistance of any Agent.
SECTION 4. Covenants of Global Funding.
Global Funding covenants and agrees with each Agent as follows:
(a) Notice of Certain Events. Global Funding will notify the Agents
immediately, and confirm such notice in writing of (i) the effectiveness of any
post-effective amendment to the Registration Statement or the filing of any
amendment or supplement to the Time of Sale Prospectus or the Prospectus (other
than any amendment or supplement thereto providing solely for the determination
of the variable terms of the Notes), (ii) the receipt of any comments from the
Commission with respect to the Registration Statement, any preliminary
prospectus and the Prospectus, (iii) any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement to the
Base Prospectus, in each case as amended or supplemented, (iv) the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement, or of any order preventing or suspending the use of any
preliminary prospectus or Prospectus, or of the initiation of any proceedings
for that purpose or (v) the failure of the Notes of any Issuing Trust to be
qualified for offer and sale under the securities or blue sky laws of such
jurisdiction as the Agents may request pursuant to Section 4(t). With respect to
the Registration Statement, any preliminary prospectus and the Prospectus,
Global Funding will make every reasonable effort to prevent the issuance of any
stop order (or any similar order under blue sky laws) and, if any stop order (or
16
any similar order under blue sky laws) is issued, to obtain the lifting thereof
at the earliest possible moment.
(b) Filing or Use of Amendments. Global Funding will give each Agent
advance notice of its intention to file or prepare any additional registration
statement with respect to the registration of additional Notes, any amendment to
the Registration Statement or any amendment or supplement to any preliminary
prospectus, or to the Prospectus (other than an amendment or supplement thereto
providing solely for the determination of the variable terms of the Notes),
whether pursuant to the 1933 Act, the 1934 Act or otherwise, and will provide
immediate notice to each relevant Agent of any intention to prepare an amendment
or supplement to the Time of Sale Prospectus and, if applicable to file such
amendment or supplement pursuant to the 1933 Act, and will furnish to such
Agents copies of any such document a reasonable amount of time prior to such
proposed filing or the use of such material, as the case may be, and will not
file or use any such document to which an Agent or counsel for the Agents shall
object.
(c) Revisions of Registration Statement. If at any time during the term of
this Agreement any event shall occur or condition shall exist as a result of
which it is necessary, in the reasonable opinion of counsel for the Agents or
counsel for Global Funding, to amend the Registration Statement in order that
the Registration Statement 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, or if it shall be necessary, in
the reasonable opinion of either such counsel, to amend the Registration
Statement in order to comply with the requirements of the 1933 Act or the 1933
Act Regulations, Global Funding shall give immediate notice, confirmed in
writing, to the Agents to cease the solicitation of offers for the purchase of
Notes and to cease sales of any Notes they may then own, and Global Funding will
promptly prepare and file with the Commission, subject to Section 4(b) hereof,
such amendment as may be necessary to correct such statement or omission or to
make the Registration Statement comply with such requirements, and Global
Funding will furnish to the Agents, without charge, such number of copies of
such amendment as the Agents may reasonably request.
(d) Use of Free Writing Prospectuses. Global Funding and the Issuing Trusts
will not take any action that would result in an Agent being required to file
with the Commission pursuant to Rule 433(d) of the 1933 Act Regulations a free
writing prospectus prepared by or on behalf of an Agent that such Agent
otherwise would not have been required to file thereunder.
(e) Revisions of Time of Sale Prospectuses. If the Time of Sale Prospectus
is being used to solicit offers to buy any Notes of a series at a time when the
Prospectus is not yet available to prospective purchasers and any event shall
occur or condition shall exist as a result of which it is necessary, in the
reasonable opinion of counsel for the applicable Agent(s) or counsel for Global
Funding, to amend or supplement the Time of Sale Prospectus in writing in order
that the Time of Sale Prospectus will not include an untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein not misleading in the light of the circumstances existing at
the time the Time of Sale Prospectus is conveyed to a prospective purchaser, or
if, in the reasonable opinion of either such counsel, it is necessary to amend
or supplement the Time of Sale Prospectus to comply with the 1933 Act or 1933
Act Regulations, Global Funding shall give notice, confirmed in writing, to each
of the applicable
17
Agents and Global Funding will promptly prepare and, if applicable, file with
the Commission such amendment or supplement as may be necessary to correct such
statement or omission or to make the Time of Sale Prospectus comply with such
requirements, and Global Funding will furnish to each of the applicable Agents,
without charge, such number of copies of such amendment or supplement, as the
relevant Agents may reasonably require.
(f) Revisions of Prospectus. If at any time when, in the reasonable opinion
of counsel to the Agents or counsel to the Company, the Prospectus (or in lieu
thereof the notice referred to in Rule 173(a) under the 1933 Act Regulations) is
required to be delivered, any event shall occur or condition shall exist as a
result of which it is necessary, in the opinion of counsel for the Agents or
counsel for Global Funding, to amend or supplement the Prospectus in order that
the Prospectus will not include an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements therein not
misleading in the light of the circumstances existing at the time the Prospectus
or in lieu thereof, the notice referred to in Rule 173(a) of the 1933 Act
Regulations, is delivered to a purchaser, or if it shall be necessary, in the
opinion of any such counsel, to amend the Registration Statement or amend or
supplement the Prospectus in order to comply with the requirements of the 1933
Act or the 1933 Act Regulations, as applicable, Global Funding shall give
immediate notice, confirmed in writing, to the Agents to cease the solicitation
of offers for the purchase of Notes in their capacity as agent and to cease
sales of any Notes they may then own as principal, and Global Funding will
promptly prepare and file with the Commission, subject to Section 4(b) hereof,
such amendment or supplement as may be necessary to correct such statement or
omission or to make the Prospectus comply with such requirements, and Global
Funding will furnish to the Agents, without charge, such number of copies of
such amendment or supplement as the Agents may reasonably request. In addition,
Global Funding will comply with the 1933 Act, the 1933 Act Regulations, the 1934
Act and the 1934 Act Regulations so as to permit the completion of the
distribution of each offering of Notes.
(g) Delivery of the Registration Statement. Global Funding will furnish to
the Agents and to counsel for the Agents, without charge, signed and conformed
copies of the Registration Statement and conformed copies of all consents and
certificates of experts. The Registration Statement furnished to an Agent will
be identical in all material respects to any electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T.
(h) Delivery of the Preliminary Prospectus and Time of Sale Prospectus.
Global Funding will deliver to each applicable Agent, without charge, as many
copies of each preliminary prospectus as such Agent may reasonably request, and
Global Funding hereby consents to the use of such copies for purposes permitted
by the 1933 Act. Global Funding will furnish to each applicable Agent, without
charge, such number of copies of the applicable Time of Sale Prospectus (as
amended or supplemented) as such Agent may reasonably request. Each such
document furnished to the applicable Agents will be identical to any
electronically transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation S-T.
(i) Delivery of Free Writing Prospectuses. Global Funding will deliver to
each applicable Agent and, without charge, as many copies of each free writing
prospectus, prepared
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by or on behalf of, used by, or referred to by Global Funding. To the extent
applicable, each such document furnished to the Agents will be identical to any
electronically transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation S-T.
(j) Delivery of the Prospectus. Global Funding will deliver to each
applicable Agent, without charge, as many copies of the Base Prospectus (as
amended or supplemented) as such Agent may reasonably request, and Global
Funding hereby consents to the use of such copies for purposes permitted by the
1933 Act. It is hereby acknowledged that Global Funding intends to rely on the
provisions of Rule 172 of the 1933 Act Regulations with respect to the delivery
of the Prospectus. The Prospectus and any amendments or supplements thereto
furnished to such Agent will be identical in all material respects to any
electronically transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation S-T.
(k) Preparation of Pricing Supplements. Global Funding will prepare, with
respect to any Notes to be sold pursuant to this Agreement, a Pricing Supplement
with respect to such Notes in a form previously approved by the Agents. Global
Funding will deliver such Pricing Supplement no later than 11:00 a.m., New York
City time, on the business day following the Applicable Time for the relevant
Issuing Trust and will file such Pricing Supplement pursuant to Rule 424(b)
under the 1933 Act Regulations.
(l) Reporting Requirements. Global Funding will file, or cause to be filed,
all documents required to be filed on its behalf or on behalf of the Issuing
Trusts with the Commission pursuant to the 1934 Act within the time periods
prescribed by the 1934 Act and the 1934 Act Regulations.
(m) Restrictions on the Offer and Sale of Securities to Institutional
Purchasers. Unless otherwise agreed upon between one or more Agents, on one
hand, and the Company and Global Funding, on the other hand, from the date of
the agreement by such Agent(s) to purchase Notes from an Issuing Trust to and
including the Settlement Date with respect thereto, Global Funding will not, and
will cause all Issuing Trusts not to, without the prior written consent of such
Agent(s), issue, sell, offer or contract to sell, grant any option for the sale
of, or otherwise dispose of, any substantially similar debt securities of each
such Issuing Trust to the same potential institutional investors (other than
Notes to be offered and/or sold to or through such Agent(s)).
(n) Restrictions on the Offer and Sale of Securities to Retail Purchasers.
Unless otherwise agreed upon between the Purchasing Agent, on the one hand, and
the Company and Global Funding, on the other hand, from the date the retail
pricing levels are posted out to the selling group members through and including
the applicable Settlement Date with respect thereto, Global Funding will not,
and will cause all Issuing Trusts not to, without the prior written consent of
the Purchasing Agent, issue, sell, offer or contract to sell, grant any option
for the sale of, or otherwise dispose of, any substantially similar debt
securities of each such Issuing Trust to the same potential retail investors
(other than Notes to be offered and/or sold to or through the Purchasing Agent).
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(o) Use of Proceeds. Global Funding shall cause each Issuing Trust to use
the net proceeds received by it from the issuance and sale of the Notes in the
manner specified in the Time of Sale Prospectus.
(p) Listing. Global Funding shall use reasonable efforts to obtain and
maintain approval for the listing of at least one series of Notes of an Issuing
Trust on a national securities exchange as defined in Section 18(a)(3)(B) of the
1933 Act as long as Notes of any Issuing Trust are outstanding.
(q) Outstanding Aggregate Principal Amount of Notes. Global Funding will
promptly, upon request by an Agent notify such Agent of the aggregate principal
amount of Notes from time to time outstanding under the Programs in their
currency of denomination and (if so requested) expressed in United States
dollars. For the purpose of determining the aggregate principal amount of Notes
outstanding (i) the principal amount of Notes, denominated in a currency other
than United States dollars shall be converted into United States dollars using
the spot rate of exchange for the purchase of the relevant currency against
payment of United States dollars being quoted by the Paying Agent or Calculation
Agent, as applicable (each as defined in the Indenture), on the date on which
the relevant Notes were initially offered, (ii) any Notes which provide for an
amount less than the principal amount thereof to be due and payable upon
redemption following an Event of Default as defined in the Indenture in respect
of such Notes, shall have a principal amount equal to their redemption amount,
(iii) any zero coupon (and any other Notes issued at a discount or premium)
shall have a principal amount equal to their issue amount and (iv) the currency
in which any Notes are payable, if different from the currency of their
denomination, shall be disregarded.
(r) Blue Sky Qualifications. Global Funding shall endeavor, and shall cause
the applicable Issuing Trust, to qualify the Notes for offer and sale under the
securities or Blue Sky laws of such jurisdictions as the Agents shall reasonably
request and to maintain such qualifications for as long as such Agents shall
reasonably request.
(s) Depository Trust Company. Global Funding shall endeavor to assist the
Agents in arranging to cause the Notes to be eligible for settlement through the
facilities of the Depository Trust Company ("DTC").
(t) Notice of Amendment to Global Funding Trust Agreement. Global Funding
will give the Agents at least three (3) business days' prior notice in writing
of any proposed amendment to the Global Funding Trust Agreement and, except in
accordance with the applicable provisions of the Global Funding Trust Agreement,
not make or permit to become effective any amendment to Global Funding Trust
Agreement which may adversely affect the interests of the Agents or any holder
of any outstanding Notes without the consent of the affected party.
(u) Authorization to Act on Behalf of Global Funding. Global Funding will,
from time to time, without request, deliver to the Agents a certificate as to
the names and signatures of those persons authorized to act on behalf of Global
Funding in relation to the Programs if such information has changed.
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(v) Notice of Meeting. Global Funding will furnish to the Agents, at the
same time as it is dispatched, a copy of notice of any meeting of the holders of
Notes which is called to consider any matter which is material in the context of
Global Funding.
(w) Notices Regarding Ratings. Global Funding will notify the Agents
immediately, and confirm such notice in writing, of any change in the rating
assigned by Moody's or Standard & Poor's to the Program or the Notes issued
pursuant to the Registration Statement as applicable.
SECTION 5. Covenants of the Issuing Trusts.
Each Issuing Trust, only with respect to itself, covenants and agrees with
each Agent as follows:
(a) Use of Proceeds. Such Issuing Trust shall use the net proceeds received
by it from the issuance and sale of the Notes in the manner specified in the
Time of Sale Prospectus.
(b) Blue Sky Qualifications. Such Issuing Trust shall endeavor to qualify
the Notes for offer and sale under the securities or Blue Sky laws of such
jurisdictions as the Agents shall reasonably request and to maintain such
qualifications for as long as such Agents shall reasonably request.
(c) Depository Trust Company. Such Issuing Trust shall endeavor to assist
the Agents in arranging to cause the Notes to be eligible for settlement through
the facilities of DTC.
(d) Notice of Amendment to Indenture and Issuing Trust Agreement. Such
Issuing Trust will give the Agents at least three (3) business days' prior
notice in writing of any proposed amendment to the relevant Indenture and
relevant Issuing Trust Agreement and, except in accordance with the applicable
provisions of the relevant Indenture and relevant Issuing Trust Agreement, not
make or permit to become effective any amendment to such Indenture or such
Issuing Trust Agreement which may adversely affect the interests of the Agents
or any holder of any outstanding Notes without the consent of the affected
party.
(e) Authorization to Act on Behalf of the Issuing Trust. Such Issuing Trust
will, from time to time, without request, deliver to the Agents a certificate as
to the names and signatures of those persons authorized to act on behalf of such
Issuing Trust in relation to the Programs if such information has changed.
(f) Notice of Meeting. Such Issuing Trust will furnish to the Agents, at
the same time as it is dispatched, a copy of notice of any meeting of the
holders of Notes which is called to consider any matter which is material in the
context of such Issuing Trust.
SECTION 6. Covenants of the Agents. Each Agent covenants with Global Funding:
(a) Delivery of Free Writing Prospectuses and Other Marketing Materials.
Except as otherwise provided in the applicable Terms Agreement, such Agent will,
prior to its first use, furnish Global Funding with a copy of each proposed free
writing prospectus that is required to be filed pursuant to Rule 433(d) under
the 1933 Act Regulations or is or will be part of the Time of Sale Prospectus
and any other marketing materials (other than (x) any free writing prospectus
21
that is not required to be filed or will not be part of the Time of Sale
Prospectus or (y) any marketing material that complies with Rule 134 of the 1933
Act Regulations) relating to or to be used in connection with any offer or sale
of the Notes, in each case prepared by or on behalf of such Agents and will not
use any such free writing prospectus or other marketing materials to which
Global Funding reasonably objects.
(b) Use of Free Writing Prospectuses and Other Marketing Materials. Such
Agent may use a free writing prospectus or any other marketing materials
prepared by or on behalf of such Agent, only if such free writing prospectus or
such marketing materials complies in all material respects with the requirements
of the 1933 Act and the 1933 Act Regulations.
(c) Distribution of Free Writing Prospectuses and Other Marketing
Materials. Such Agent will not distribute any free writing prospectus or any
other marketing materials (other than any marketing material that complies with
Rule 134 of the 1933 Act Regulations) used or referred to by such Agent in a
manner reasonably designed to lead to its broad unrestricted dissemination;
provided that this covenant shall not apply to any free writing prospectus or
such marketing materials forming part of the Time of Sale Prospectus or any free
writing prospectus or such marketing materials prepared or approved by Global
Funding for broad unrestricted dissemination.
SECTION 7. Conditions of Agent's Obligations.
The obligations of one or more Agents to purchase Notes from an Issuing
Trust as principal, the obligations of an Agent to solicit offers for the
purchase of Notes as an agent of an Issuing Trust and the obligations of any
purchasers of Notes sold through an Agent as an agent of an Issuing Trust, will
be subject to the accuracy of the representations and warranties on the part of
Global Funding and such Issuing Trust herein contained, and the accuracy of the
representations and warranties on the part of the Company contained in the
Representations and Indemnity Agreement entered into, as of even date herewith,
by and among the Company and the Agents, as amended, restated or modified from
time to time (the "Representations and Indemnity Agreement") or contained in any
certificate of an officer or trustee of Global Funding, Issuing Trust or the
Company delivered pursuant to the provisions hereof and thereof, as applicable,
to the performance and observance by Global Funding and such Issuing Trust of
its covenants and other obligations hereunder or the performance and observance
by the Company of its covenants and other obligations under the Representations
and Indemnity Agreement, and to the following additional conditions precedent:
(a) Effectiveness of the Registration Statement. The Registration Statement
has become effective under the 1933 Act and the 1934 Act, as applicable, and no
stop order suspending the effectiveness of the Registration Statement shall have
been issued under the 1933 Act or the 1934 Act, as applicable, and no
proceedings for that purpose shall have been instituted or shall be pending or
threatened by the Commission, and any request on the part of the Commission for
additional information shall have been complied with to the reasonable
satisfaction of counsel to the Agents.
(b) Legal Opinions, Memoranda and Negative Assurance Letters. On the date
hereof (or in the case of the negative assurance and opinion letters specified
in clauses (ii), (viii) and
22
(xi) below, prior to the Applicable Time for the first issuance of Notes
following the date of this Agreement), the Agents shall have received the
following legal opinions, memoranda and negative assurance letters dated as of
the date hereof (or in the case of the negative assurance and opinion letters
specified in clauses (ii), (viii) and (xi) below, as of the date of such
negative assurance letter or opinion letter, as the case may be) and in form and
substance satisfactory to the Agent:
(i) Opinion of Internal Counsel for the Company. The opinion of
internal Counsel for the Company, to the effect set forth in Exhibit A
hereto and to such further effect as the Agents may reasonably request;
(ii) Negative Assurance Letter of Company's Internal Counsel or Other
Legal Counsel for the Company. The negative assurance letter of the General
Counsel of the Company or other legal counsel selected by the Company and
reasonably satisfactory to the Agents to the effect set forth in Exhibit B
hereto and to such further effect as the Agents may reasonably request;
(iii) Opinion of Counsel for the Company Concerning Certain
Insolvency, Funding Agreement Authority and Funding Agreement
Enforceability Matters. The opinion of Lord, Bissell & Brook or other legal
counsel selected by the Company and reasonably satisfactory to the Agents
to the effect set forth in Exhibit C hereto and to such further effect as
the Agents may reasonably request;
(iv) Opinion of Counsel for the Company Concerning Certain Illinois
Security Interest Matters. The opinion of Lord, Bissell & Brook, counsel
for the Company, to the effect set forth in Exhibit D hereto and to such
further effect as the Agents may reasonably request;
(v) Opinion of Counsel for the Company Concerning Certain Federal
Securities and New York Matters. The opinion of LeBoeuf, Lamb, Greene &
MacRae, L.L.P. or other legal counsel selected by the Company and
reasonably satisfactory to the Agents ("Company Counsel") to the effect set
forth in Exhibit E hereto and to such further effect as the Agents may
reasonably request;
(vi) Opinion of Counsel for the Company Concerning Certain Tax
Matters. The opinion of Company Counsel to the effect set forth in Exhibit
F hereto and to such further effect as the Agents may reasonably request;
(vii) Memorandum of Counsel for the Company Concerning Certain
Insurance Matters. The memorandum of Company Counsel to the effect set
forth in Exhibit G hereto and to such further effect as the Agents may
reasonably request;
(viii) Negative Assurance Letter of Counsel for the Agents. The
negative assurance letter of Sidley Austin LLP or other legal counsel
selected by the Agents and reasonably satisfactory to Global Funding and
the Company, with respect to the matters set forth in Exhibit H hereto;
23
(ix) Opinion of Counsel for the Global Funding Delaware Trustee and
the Relevant Issuing Trust Trustee. The opinion of Richards, Layton &
Finger, counsel for the Global Funding Delaware Trustee, to the effect set
forth in Exhibit I hereto and to such further effect as the Agents may
reasonably request;
(x) Opinion of Counsel for Global Funding Administrator and Issuing
Trust Administrator. The opinion of counsel for Global Funding
Administrator, to the effect set forth in Exhibit J hereto and to such
further effect as the Agents may reasonably request;
(xi) Opinion of Counsel for the Indenture Trustee. The opinion of
counsel for the Indenture Trustee to the effect set forth in Exhibit K
hereto and to such further effect as the Agents may reasonably request;
(xii) Opinion of Counsel for Global Funding and relevant Issuing Trust
Concerning Certain Delaware Security Interest Matters. The opinion of
Richards, Layton & Finger or other legal counsel selected by the Global
Funding Delaware Trustee and reasonably satisfactory to the Agents, to the
effect set forth in Exhibit L hereto and to such further effect as the
Agents may reasonably request;
(xiii) Opinion of Counsel for Global Funding. The opinion of Richards,
Layton & Finger or other legal counsel selected by the Global Funding
Delaware Trustee and reasonably satisfactory to the Agents, to the effect
set forth in Exhibit M hereto and to such further effect as the Agents may
reasonably request; and
(xiv) Opinion of Counsel for the relevant Issuing Trust. The opinion
of Richards, Layton & Finger or other legal counsel selected by the Global
Funding Delaware Trustee and reasonably satisfactory to the Agents, to the
effect set forth in Exhibit N hereto and to such further effect as the
Agents may reasonably request.
Unless otherwise agreed among the relevant Issuing Trust and the Agents, each of
the opinions set forth in Section 7(b) above will be delivered as of each March
31st, commencing March 31, 2006, modified as necessary to relate to such time of
delivery.
(c) Global Funding Certificate. Global Funding shall have furnished to the
Agents a certificate of Global Funding, signed by Global Funding Administrator
of Global Funding, dated the date of such certificate, to the effect that:
(i) the representations and warranties of Global Funding and, if
applicable, the relevant Issuing Trust in this Agreement are true and
correct on and as of the date of such certificate with the same effect as
if made on the date hereof and Global Funding and, if applicable, relevant
Issuing Trust have complied with all agreements and satisfied all the
conditions on its part to be performed or satisfied at or prior to the date
of such certificate;
(ii) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or, to Global Funding's knowledge, threatened; and
24
(iii) since the date of the Prospectus there has occurred no event
required to be set forth in an amendment or supplement to the Registration
Statement or Prospectus, and there has been no document required to be
filed under the 1933 Act, the 1933 Act Regulations, the 1934 Act or the
1934 Act Regulations which, upon filing, would be deemed to be incorporated
by reference in the Prospectus which has not been so filed.
(d) Company Officer's Certificate. The Company shall have furnished to the
Agents a certificate of the Company, signed by either the Chairman of the Board,
Chief Executive Officer, President, Chief Operating Officer, Chief Financial
Officer, Secretary, General Counsel or Treasurer of the Company, dated the date
of such certificate, to the effect set forth in Section 4(c) of the
Representations and Indemnity Agreement.
(e) Comfort Letter of Accountants to the Company. Prior to the first
issuance of Notes under the Program, the Agents shall have received a letter
from Deloitte & Touche LLP or its successor, as the independent registered
public accounting firm to the Company (the "Accountants"), , and in form and
substance satisfactory to the Agent, to the effect set forth in Exhibit O
hereto.
(f) Additional Documents. On the date hereof, counsel to the Agents shall
have been furnished with such documents and opinions as such counsel may require
for the purpose of enabling such counsel to pass upon the issuance and sale of
Notes as herein contemplated and related proceedings, or in order to evidence
the accuracy of any of the representations and warranties, or the fulfillment of
any of the conditions, herein contained; and all proceedings taken by the
Company and Global Funding in connection with the issuance and sale of the Notes
as herein contemplated shall be satisfactory in form and substance to the Agents
and to counsel to the Agents.
If any condition specified in this Section 7 shall not have been fulfilled
when and as required to be fulfilled, this Agreement may be terminated by the
applicable Agent(s) by notice to Global Funding or relevant Issuing Trust at any
time and any such termination shall be without liability of any party to any
other party except as provided in Section 12 hereof and except that Sections 10,
11, 13, 16 and 17 hereof shall survive any such termination and remain in full
force and effect.
SECTION 8. Delivery of and Payment for Notes Sold through an Agent as Agent.
Delivery of Notes sold through an Agent as an agent of an Issuing Trust
shall be made by the Issuing Trust to such Agent for the account of any
purchaser only against payment therefor in immediately available funds. In the
event that a purchaser shall fail either to accept delivery of or to make
payment for a Note on the date fixed for settlement, such Agent shall promptly
notify such Issuing Trust and deliver such Note to such Issuing Trust and, if
such Agent has theretofore paid such Issuing Trust for such Note, such Issuing
Trust will promptly return such funds to such Agent. If such failure has
occurred for any reason other than default by such Agent in the performance of
its obligations hereunder, such Issuing Trust will reimburse such Agent on an
equitable basis for its loss of the use of the funds for the period such funds
were credited to such Issuing Trust's account.
25
SECTION 9. Additional Covenants of Global Funding and Issuing Trust.
Global Funding and each Issuing Trust (only with respect to itself) further
covenants and agrees with each Agent as follows:
(a) Reaffirmation of Representations and Warranties. Each acceptance by an
Issuing Trust of an offer for the purchase of Notes (whether to one or more
Agents as principal or through one or more Agents as agent), and each delivery
of Notes (whether to one or more Agents as principal or through an Agent as
agent) shall be deemed to be an affirmation that the representations and
warranties of Global Funding and such Issuing Trust contained in any certificate
theretofore delivered to such Agent pursuant hereto are true and correct at the
time of such acceptance or sale, as the case may be, and an undertaking that
such representations and warranties will be true and correct at the time of
delivery to such Agent(s) or to the purchaser or its agent, as the case may be,
of the Notes relating to such acceptance or sale, as the case may be, as though
made at and as of each such time (it being understood that such representations
and warranties shall relate to the Registration Statement and Prospectus as
amended and supplemented to each such time).
(b) Subsequent Delivery of Certificates. At (i) each time that the
Registration Statement or Base Prospectus shall be amended or supplemented
(other than by (A) an amendment or supplement providing solely for the
determination of the variable terms of the Notes and (B) an amendment deemed to
have occurred as a result of a periodic filing by the Company, Global Funding or
any Issuing Trust under the 1934 Act or the 1934 Act Regulations, except any
quarterly report of the Company on Form 10-Q or any annual report of the Company
on Form 10-K (any such report, an "SEC Periodic Report")), and (ii) each
Settlement Date, Global Funding shall, and agrees to cause the Company to,
furnish or cause to be furnished to the Agents, forthwith a certificate dated
the date of filing with the Commission or the date of effectiveness of such
amendment or supplement, as applicable, or the date of such sale, as the case
may be, in form satisfactory to the Agents to the effect that the statements
contained in the certificate referred to in Sections 7(c) and 7(d) hereof which
were last furnished to the Agents are true and correct at the time of the filing
or effectiveness of such amendment or supplement, as applicable, or the time of
such sale, as the case may be, as though made at and as of such time (except
that such statements shall be deemed to relate to the Registration Statement as
amended and supplemented to such time) or, in lieu of such certificate, a
certificate of the same tenor as the certificate referred to in Sections 7(c)
and 7(d) hereof, modified as necessary to relate to the Registration Statement
as amended and supplemented to the time of delivery of such certificate (it
being understood that, in the case of clause (ii) above, any such certificate
shall also include a certification that there has been no material adverse
change in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its subsidiaries considered as
one enterprise or of Global Funding or any Issuing Trust since the date of the
agreement by such Agent to purchase Notes from such Issuing Trust as principal);
provided, however, that any delivery of certificates as required by this Section
9(b) due to the filing of an SEC Periodic Report shall only be required to be
delivered prior to the pricing date for such Issuing Trust's Notes issued
immediately after such SEC Periodic Report.
(c) Subsequent Delivery of Legal Opinions. As agreed to from time to time
by the Agents and Global Funding, Global Funding shall furnish or cause to be
furnished to the Agents
26
legal opinions of internal counsel for the Company, counsel for the Company,
counsel for the Global Funding Delaware Trustee and the Relevant Issuing Trust
Trustee, counsel for Global Funding and the relevant Issuing Trust, counsel for
the Indenture Trustee and counsel for Global Funding Administrator and the
Issuing Trust Administrator, as applicable, dated the date agreed to by the
Agents and Global Funding, in form and substance reasonably satisfactory to the
Agents, of substantially the same tenor as the legal opinions referred to in
Section 7(b)(i), Section 7(b)(iii), Section 7(b)(iv), Section 7(b)(v), Section
7(b)(vi), Section 7(b)(viii), Section 7(b)(ix), Section 7(b)(x), Section
7(b)(xi), Section 7(b)(xii), Section 7(b)(xiii) and Section 7(b)(xiv) hereof, as
applicable, modified as necessary to relate to any report filed by the Company
under Section 14 or Section 16(d) of the 1934 Act, to the time of delivery of
such legal opinions or, in lieu of such legal opinions, counsel last furnishing
such legal opinions to the Agents shall furnish such Agents with a letter
substantially to the effect that the Agents may rely on such last legal opinions
to the same extent as though it was dated the date of such letter authorizing
reliance (except that statements in such last legal opinions shall be deemed to
relate to the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such letter authorizing reliance).
(d) Subsequent Delivery of Negative Assurance Letter of Internal Counsel or
Other Counsel for the Company. Each time that (i) the Registration Statement or
Prospectus shall be amended or supplemented (other than by (A) an amendment or
supplement providing solely for the determination of the variable terms of the
Notes and (B) an amendment deemed to have occurred as a result of a periodic
filing by the Company, Global Funding or any Issuing Trust under the 1934 Act or
the 1934 Act Regulations, except any SEC Periodic Report), (ii) (if required in
connection with the purchase of Notes from an Issuing Trust by one or more
Agents as principal) an Issuing Trust sells Notes to one or more Agents as
principal or (iii) an Issuing Trust sells Notes in a form not previously
certified to the Agents by such Issuing Trust, Global Funding agrees to cause
the Company to furnish or cause to be furnished forthwith to the Agents and to
counsel to the Agents, a negative assurance letter of the General Counsel of the
Company or other legal counsel for the Company selected by the Company and
reasonably satisfactory to the Agents dated the date of filing with the
Commission or the date of effectiveness of such amendment or supplement, as
applicable, or the date of such sale, as the case may be, in form and substance
satisfactory to the Agent, of the same tenor as the negative assurance letter
referred to in Section 7(b)(ii) hereof, but modified, as necessary, to relate to
the Registration Statement and the Base Prospectus, as amended and supplemented,
to the time of delivery of such negative assurance letter or, in lieu of such
negative assurance letter, counsel last furnishing such negative assurance
letter to the Agents shall furnish such Agents with a letter substantially to
the effect that the Agents may rely on such last negative assurance letter to
the same extent as though it was dated the date of such letter authorizing
reliance (except that statements in such last negative assurance letter shall be
deemed to relate to the Registration Statement and the Base Prospectus, as
amended and supplemented, to the time of delivery of such letter authorizing
reliance); provided, however, that any negative assurance letter to be delivered
pursuant to Section 9(d)(ii) in connection with the proposed issuance of a
series of Notes will be further modified, as necessary, to also relate to the
applicable Time of Sale Prospectus, and provided, further, that any delivery of
a negative assurance letter as required by this Section 9(d) due to the filing
of an SEC Periodic Report shall only be required to be delivered prior to the
pricing date for an Issuing Trust's Notes to be issued immediately after such
SEC Periodic Report. Global Funding agrees to furnish or cause to be furnished
forthwith to the Agents the negative assurance
27
letter of Sidley Austin LLP, counsel to the Agents, or such other counsel
reasonably satisfactory to the Agents, dated within ten (10) days of the date of
the filing of the Company's Form 10-K with the Commission, of the same tenor as
the opinion referred to in Section 7(b)(viii) hereof, but modified, as
necessary, to relate to the Registration Statement and Prospectus as amended and
supplemented to the time of delivery of such negative assurance letter.
(e) Delivery of Legal Opinions or Reliance Letters Upon Issuance of Notes.
Unless otherwise agreed to among the Company, Global Funding and the applicable
Agent(s), Global Funding shall furnish or cause to be furnished to the
applicable Agent(s) in connection with each issuance of Notes by an Issuing
Trust (i) an opinion of internal counsel for the Company (or a reliance letter
authorizing reliance by such Agent(s) on an opinion of like tenor) as to the
validity and enforceability of the Funding Agreement(s) being issued in
connection therewith and (ii) an opinion of counsel for the Company (or a
reliance letter authorizing reliance by such Agent(s) on an opinion of like
tenor) as to the validity and enforceability of the Funding Notes of Global
Funding and of the Notes of the relevant Issuing Trust, in each case, dated the
date of such issuance, and in form and substance reasonably satisfactory to the
Agents.
(f) Subsequent Delivery of Comfort Letters. Each time that (i) the
Registration Statement or the Base Prospectus shall be amended or supplemented
to include additional financial information (other than by an amendment deemed
to have occurred as a result of a periodic filing by the Company, Global Funding
or any Issuing Trust under the 1934 Act or the 1934 Act Regulations, except any
SEC Periodic Report) or (ii) (if required in connection with the purchase of
Notes from an Issuing Trust by one or more Agents as principal) an Issuing Trust
sells Notes to one or more Agents as principal, such Issuing Trust agrees to
cause the Company to cause the Accountants forthwith to furnish to the Agents a
letter, dated the date of filing with the Commission or the date of
effectiveness of such amendment or supplement, as applicable, or the date of
such sale, as the case may be, in form satisfactory to the Agents, of the same
tenor as the letter referred to in Section 7(e) hereof but modified to relate to
the Registration Statement and Prospectus as amended and supplemented to the
date of such letter; provided, however, that any comfort letter to be delivered
pursuant to Section 9(f)(ii) in connection with the proposed issuance of a
series of Notes will be further modified, if applicable, to also relate to the
applicable Time of Sale Prospectus, and provided, further, that any delivery of
any letter as required by this Section 9(f) due to the filing of an SEC Periodic
Report shall only be required to be delivered prior to the pricing date for an
Issuing Trust's Notes issued immediately after such SEC Periodic Report.
SECTION 10. Indemnification.
(a) Indemnification of the Agent. With respect to any series of Notes,
Global Funding and the relevant Issuing Trust (only as to itself in connection
with the issuance of its Notes and without respect to any other Issuing Trust)
agree to indemnify and hold harmless each applicable Agent, its directors and
officers and each person, if any, who controls such Agent within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of an untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto) or the omission
28
or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading, or
arising out of an untrue statement or alleged untrue statement of a
material fact included in any preliminary prospectus, the applicable Time
of Sale Prospectus or the Prospectus (or any amendment or supplement
thereto) or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any 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, provided that (subject to Section
10(d) hereof) any such settlement is effected with the written consent of
Global Funding and the relevant Issuing Trust; and
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by such Agent), reasonably
incurred in investigating, preparing or defending against any litigation,
or any 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, to
the extent that any such expense is not paid under subparagraph (i) or (ii)
above;
provided, however, that this indemnity does not apply to any loss, liability,
claim, damage or expense to the extent arising out of (i) an untrue statement or
omission or alleged untrue statement or omission made in reliance upon and in
conformity with written information furnished to Global Funding by the
applicable Agents concerning such Agents expressly for use in the Registration
Statement (or any amendment thereto) or any preliminary prospectus, the
applicable Time of Sale Prospectus or the Prospectus (or any amendment or
supplement thereto), (ii) any use of the Prospectus by the Agents to sell Notes
or solicit offers for the purchase of Notes (x) after such time as Global
Funding shall have provided written notice pursuant to Section 4(f) hereunder or
the Company shall have provided written notice pursuant to Section 2(f) of the
Representations and Indemnity Agreement, to the Agents to cease the sale of
Notes and solicitation of offers for the purchase of Notes and (y) before such
time as the relevant Issuing Trust shall have advised such Agent as the case may
be, that such solicitation may be resumed or (iii) a claim for indemnity made
under the Representations and Indemnity Agreement, only to the extent such claim
has previously been satisfied by the Company pursuant to the terms of the
Representations and Indemnity Agreement.
(b) Indemnification of Global Funding and Issuing Trusts. With respect to
any series of Notes, each Agent agrees, severally but not jointly, to indemnify
and hold harmless Global Funding and each Issuing Trust, their administrator,
directors, officers and trustees (if applicable) who signed the Registration
Statement and each person, if any, who controls Global Funding and any Issuing
Trust within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934
Act against any and all loss, liability, claim, damage and expense described in
the indemnity contained in Section 10(a) hereof, as incurred, but only with
respect to untrue
29
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto) or any preliminary prospectus,
the applicable Time of Sale Prospectus or the Prospectus (or any amendment or
supplement thereto), in reliance upon and in conformity with written information
furnished to Global Funding by such Agent concerning such Agent expressly for
use in the Registration Statement (or any amendment thereto) or Registration
Statement Amendment (or any amendment thereto) or such preliminary prospectus,
the applicable Time of Sale Prospectus or the Prospectus (or any amendment or
supplement thereto).
(c) Actions Against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable 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 such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 10(a) hereof
or Section 5(a) of the Representations and Indemnity Agreement, counsel to the
indemnified parties shall be selected by the applicable Agent(s) and, in the
case of parties indemnified pursuant to Section 10(b) hereof or Section 5(b) of
the Representations and Indemnity Agreement, counsel to the indemnified shall be
selected by Global Funding, the relevant Issuing Trust and the Company. An
indemnifying party may participate at its own expense in the defense of any such
action; provided, however, that counsel to the indemnifying party shall not
(except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties (collectively with
any other indemnifying parties in connection with the Representations and
Indemnity Agreement), whether such indemnity is claimed hereunder or under the
Representations and Indemnity Agreement, be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
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.
No indemnifying party under this Agreement or the Representations and
Indemnity Agreement shall, without the prior written consent of the indemnified
parties under this Agreement and the Representations and Indemnity Agreement,
settle or compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 10 or Section
11 hereof (whether or not the indemnified parties are actual or potential
parties thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested in writing an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 10(a)(ii) effected without its written consent if
(i) such settlement is entered into more than 45 days after receipt by such
30
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
have received notice of the terms of such settlement at least 30 days prior to
such settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request prior to
the date of such settlement.
SECTION 11. Contribution.
If the indemnification provided for in Section 10 hereof is for any reason
unavailable to or insufficient to hold harmless an indemnified party in respect
of any losses, liabilities, claims, damages or expenses referred to therein,
then each indemnifying party shall contribute to the aggregate amount of such
losses, liabilities, claims, damages and expenses incurred by such indemnified
party, as incurred, (i) in such proportion as is appropriate to reflect the
relative benefits received by Global Funding and the relevant Issuing Trust, on
one hand, and the applicable Agent(s), on the other hand, from the offering of
the Notes that were the subject of the claim for indemnification or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of Global Funding and the
relevant Issuing Trust, on one hand, and the applicable Agent(s), on the other
hand, in connection with the statements or omissions which resulted in such
losses, liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by Global Funding and the relevant Issuing
Trust, on the one hand, and the applicable Agent(s), on the other hand, in
connection with the offering of the Notes that were the subject of the claim for
indemnification shall be deemed to be in the same respective proportions as the
total net proceeds from the offering of such Notes (before deducting expenses)
received by the relevant Issuing Trust and the total discount or commission
received by the applicable Agent(s), as the case may be, bears to the aggregate
initial offering price of such Notes.
The relative fault of Global Funding and the relevant Issuing Trust, on one
hand, and the applicable Agent(s), on the other hand, shall be determined by
reference to, among other things, whether any untrue or alleged untrue statement
of a material fact or omission or alleged omission to state a material fact
relates to information supplied by Global Funding and the relevant Issuing
Trust, on one hand, or by the applicable Agent(s), on the other hand, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The parties agree that it would not be just and equitable if contribution
pursuant to this Section 11 were determined by pro rata allocation (even if the
Agents 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 above in this Section 11. The aggregate amount of losses, liabilities,
claims, damages and expenses incurred by an indemnified party and referred to
above in this Section 11 shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in investigating, preparing or
defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever
based upon any applicable untrue or alleged untrue statement or omission or
alleged omission.
31
Notwithstanding the provisions of this Section 11, (i) no Agent shall be
required to contribute any amount in excess of the amount by which the total
discount or commission received by such Agent in connection with the offering of
the Notes that were the subject of the claim for indemnification exceeds the
amount of any damages which such Agent has otherwise been required to pay by
reason of any applicable untrue or alleged untrue statement or omission or
alleged omission and (ii) no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. In addition, in connection with an offering of Notes
purchased from an Issuing Trust by two or more Agents as principal, the
respective obligations of such Agents to contribute pursuant to this Section 11
are several, and not joint, in proportion to the aggregate principal amount of
Notes that each such Agent has agreed to purchase from such Issuing Trust.
For purposes of this Section 11, each director, officer and person, if any,
who controls an Agent within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as such
Agent, and each director, officer and trustee (if applicable) of Global Funding
and relevant Issuing Trust, and each person, if any, who controls Global Funding
and the relevant Issuing Trust within the meaning of Section 15 of the 1933 Act
or Section 20 of the 1934 Act shall have the same rights to contribution as
Global Funding and relevant Issuing Trust.
SECTION 12. Payment of Expenses.
Global Funding will pay all expenses incident to the performance of the
obligations of the Company, Global Funding and the relevant Issuing Trust under
this Agreement, including:
(a) The preparation, filing, printing and delivery of the Registration
Statement as originally filed and all amendments thereto and any preliminary
prospectus, free writing prospectus, Time of Sale Prospectus, the Prospectus and
any amendments or supplements thereto;
(b) The preparation, printing and delivery of Global Funding Program
Documents and the Issuing Trust Program Documents;
(c) The preparation, issuance and delivery of the Notes, including any fees
and expenses relating to the eligibility and issuance of Notes in book-entry
form and the cost of obtaining CUSIP or other identification numbers for the
Notes;
(d) The fees and disbursements of the Company's, Global Funding's and each
Issuing Trust's accountants, counsel and other advisors or agents (including any
calculation agent or exchange rate agent) and of the Global Funding Delaware
Trustee, Relevant Issuing Trust Trustee, Global Funding Administrator, Issuing
Trust Administrator, Indenture Trustee and Funding Note Indenture Trustee and
their counsel;
(e) The reasonable fees and disbursements of counsel to the Agents incurred
in connection with the maintenance of the Programs and, unless otherwise agreed,
incurred from time to time in connection with the transactions contemplated
hereby;
32
(f) The fees charged by the nationally recognized statistical rating
organizations for the rating of the Programs and the Notes;
(g) The fees and expenses incurred in connection with any listing of Notes
on a securities exchange;
(h) The filing fees incident to, and the reasonable fees and disbursements
of counsel to the Agents in connection with, the review, if any, by the National
Association of Securities Dealers, Inc. (the "NASD"); and
(i) Any reasonable advertising and other out-of-pocket expenses of the
Agents incurred with the approval of the Company, Global Funding and the Issuing
Trust.
SECTION 13. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this Agreement,
in certificates of the officers of Global Funding Administrator, the Issuing
Trust Administrator, the Global Funding Delaware Trustee and the Relevant
Issuing Trust Trustee submitted pursuant hereto or thereto shall remain
operative and in full force and effect, regardless of any investigation made by
or on behalf of the Agents or any controlling person of the Agents, or by or on
behalf of the Company, Global Funding or the Issuing Trust, and shall survive
each delivery of and payment for the Notes.
SECTION 14. Termination.
(a)Termination of this Agreement. This Agreement (excluding any agreement
by one or more Agents to purchase Notes from an Issuing Trust as principal) may
be terminated for any reason, at any time by (i) Global Funding as to all the
Agents or one or more but less than all the Agents, or (ii) an Agent as to
itself, upon the giving of thirty (30) days' prior written notice of such
termination to the other parties hereto.
(b) Termination of Agreement to Purchase Notes as Principal. The applicable
Agent(s) may terminate any agreement by such Agent(s) to purchase Notes from an
Issuing Trust as principal, immediately upon notice to such Issuing Trust, at
any time on or prior to the Settlement Date relating thereto, if (i) there has
been, since the date of such agreement or since the respective dates as of which
information is given in the Time of Sale Prospectus (exclusive of any supplement
thereto), any material adverse change in the condition, financial or otherwise,
or in the earnings, business affairs or business prospects of the Company and
its subsidiaries considered as one enterprise, or of Global Funding or such
Issuing Trust, whether or not arising in the ordinary course of business, or
(ii) there has occurred any material adverse change in the financial markets in
the United States or any outbreak of hostilities or escalation thereof or other
calamity or crisis or any change or development or event involving a prospective
change in national or international political, financial or economic conditions,
in each case the effect of which is such as to make it, in the judgment of such
Agent(s), impracticable or inadvisable to market such Notes or enforce contracts
for the sale of such Notes, (iii) trading in any securities of The Allstate
Corporation, a publicly owned holding company incorporated under the laws of the
State of Delaware (the "Corporation"), Allstate Insurance Company, a stock
property-liability insurance company incorporated under the laws of the State of
Illinois ("AIC"), the Company,
33
Global Funding or such Issuing Trust has been suspended or materially limited by
the Commission or a national securities exchange, or if trading generally on the
New York Stock Exchange or the American Stock Exchange or in the Nasdaq National
Market has been suspended or materially limited, or minimum or maximum prices
for trading have been fixed, or maximum ranges for prices have been required, by
either of said exchanges or by such system or by order of the Commission, the
NASD or any other governmental authority, or a material disruption has occurred
in commercial banking or securities settlement or clearance services in the
United States, (iv) a banking moratorium has been declared by either Federal or
New York authorities or by the relevant authorities in the country or countries
of origin of any foreign or composite currency in which such Notes are
denominated or payable or (v) the rating assigned by any nationally recognized
statistical rating organization to the Programs or any other debt securities
(including the Notes) of any Issuing Trust or the financial strength of the
Company as of the date of such agreement shall have been lowered or withdrawn
since that date or if any such rating organization shall have publicly announced
that it has under surveillance or review its rating, with possible negative
implications, of the Programs or any such debt securities (including the Notes)
of any Issuing Trust or the financial strength of the Company.
(c) General. In the event of any such termination, neither party will have
any liability to the other party hereto, except that (i) the Agent(s) shall be
entitled to any commissions earned in accordance with the third paragraph of
Section 3(b) hereof, (ii) if at the time of termination (a) any Agent shall own
any Notes purchased by it from an Issuing Trust as principal or (b) an offer to
purchase any of the Notes has been accepted by an Issuing Trust but the time of
delivery to the purchaser or his agent of such Notes relating thereto has not
occurred, the covenants set forth in Sections 4, 5 and 9 hereof shall remain in
effect until such Notes are so resold or delivered, as the case may be, and
(iii) the provisions of Section 12 hereof, the indemnity and contribution
agreements set forth in Sections 10 and 11 hereof, and the provisions of
Sections 13, 16 and 17 hereof shall remain in effect.
SECTION 15. Notices.
Unless otherwise provided herein, all notices required under the terms and
provisions hereof shall be in writing, either delivered by hand, by mail or by
telex, telecopier or telegram, and any such notice shall be effective when
received at the address specified below.
If to Global Funding or any Issuing Trust:
Allstate Life Global Funding
c/o AMACAR Pacific Corp.
6525 Morrison Boulevard
Suite 318
Charlotte, NC 28211
Attention: President
Telecopy No.: (704) 365-1632
With a copy to the Company at the address set forth below.
34
If to the Agents:
To each Agent at the address specified in Schedule 1.
With a copy to the Company at the address set forth below.
Address of the Company:
Allstate Life Insurance Company
3100 Sanders Road
Northbrook, IL 60062
Attention: Assistant Vice President, Institutional Markets
Telecopy No.: (847) 326-6289
or at such other address as such party or the Company may designate from time to
time by notice duly given in accordance with the terms of this Section 15.
SECTION 16. Parties.
This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective successors. Nothing expressed or mentioned
in this Agreement is intended or shall be construed to give any person, firm or
corporation, other than the parties hereto and their respective successors and
the controlling persons, officers and directors referred to in Sections 10 and
11 hereof and their heirs and legal representatives, any legal or equitable
right, remedy or claim under or in respect of this Agreement or any provision
herein contained. This Agreement and all conditions and provisions hereof are
intended to be for the sole and exclusive benefit of the parties hereto and
their respective successors, and said controlling persons, officers and
directors and their heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Notes shall be deemed to be a
successor by reason merely of such purchase.
SECTION 17. GOVERNING LAW; FORUM.
PURSUANT TO SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF
NEW YORK, THIS AGREEMENT AND ALL THE RIGHTS AND OBLIGATIONS OF THE PARTIES SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES. ANY SUIT, ACTION OR
PROCEEDING BROUGHT BY THE TRUST AGAINST ANY AGENT IN CONNECTION WITH OR ARISING
UNDER THIS AGREEMENT SHALL BE BROUGHT SOLELY IN THE STATE OR FEDERAL COURT OF
APPROPRIATE JURISDICTION LOCATED IN THE BOROUGH OF MANHATTAN, THE CITY OF NEW
YORK.
SECTION 18. Effect of Headings.
The Article and Section headings herein are for convenience only and shall
not affect the construction hereof.
35
SECTION 19. Counterparts.
This Agreement may be executed in one or more counterparts and, if executed
in more than one counterpart, the executed counterparts hereof shall constitute
a single instrument.
SECTION 20. Amendments.
(a) This Agreement may be amended or supplemented if, but only if, such
amendment or supplement is in writing and is signed by Global Funding and the
Agents. Global Funding and any Issuing Trust may from time to time nominate any
institution as a new Agent hereunder either in respect of the Programs generally
or in relation to a particular Issuing Trust's Notes only; in which event, upon
confirmation by such institution of an initial purchaser accession letter (the
"Agent Accession Letter") in the terms or substantially in the form of Exhibit
P, such institution shall become a party hereto, subject as provided below, with
all the authority, rights, powers, duties and obligations of an Agent as if
originally named as an Agent hereunder; provided further that, in the case of an
institution which has become an Agent in relation to a particular Issuing
Trust's Notes, following the issue of the relevant Notes, the relevant new Agent
shall have no further authority rights, powers, duties or obligations except
such as may have accrued or been incurred prior to, or in connection with, the
issue of such Issuing Trust's Notes. Any Agent that executes a counterpart to
this Agreement shall simultaneously execute a counterpart to the Representations
and Indemnity Agreement.
(b) The parties hereto acknowledge and agree that a copy of each amendment
to this Agreement effected pursuant to this Section 20 shall be provided
promptly by Global Funding to the following Ratings Agencies at the following
addresses:
Standard & Poor's Ratings Services,
a division of The McGraw-Hill Companies, Inc.
55 Water Street
New York, New York 10041
Attention: Capital Markets
Facsimile: (212) 438-5215
Moody's Investors Service, Inc.
99 Church Street
New York, New York 10007
Attention: Moody's Investors Service Life Insurance Group
Facsimile: (212) 553-4805
or such other addresses previously furnished in writing to Global Funding by any
Rating Agency in the future; provided, however, that any failure by Global
Funding to deliver copies of any amendment required to be delivered pursuant to
this Section 20 shall not constitute a breach of or an event of default under
this Agreement. The term "Rating Agency", for purposes of this Section 20, means
any of Standard & Poor's, Moody's or any other "nationally recognized
statistical rating organization" (as such term is defined in Rule 436(g)(2) of
the 1933 Act Regulations).
36
SECTION 21. Separate Nature of Each Issuing Trust.
The Agents agree and acknowledge that, as a separate and distinct special
purpose statutory trusts, the debts, liabilities, obligations and expenses
incurred, contracted for or otherwise existing with respect to a particular
Issuing Trust, including such Issuing Trust's obligations under this Agreement
and the applicable Terms Agreement, will be enforceable only against such
Issuing Trust and not against any other Issuing Trust.
SECTION 22 Stabilization.
The Agent(s) may, to the extent permitted by applicable laws, over-allot
and effect transactions in any over-the-counter market or otherwise in
connection with the distribution of the Notes with a view to supporting the
market price of Notes at levels higher than those that might otherwise prevail
in the open market. Such transactions, if commenced, may be discontinued at any
time. In such circumstances, as between an Issuing Trust, on one hand, and one
or more Agents, on the other hand, such Agent(s) shall act as principal, and any
loss resulting from stabilization shall be borne, and any profit arising
therefrom and any sum received by such Agent(s) shall be beneficially retained
by such Agent(s), as the case may be, for such Agents' own account.
SECTION 23. Liability of Delaware Trustee.
It is expressly understood and agreed by the parties that (a) this document
is executed and delivered by Wilmington Trust Company, not individually or
personally, but solely as Delaware Trustee, in the exercise of the powers and
authority conferred and vested in it, pursuant to the Global Funding Trust
Agreement and the relevant Issuing Trust Agreements, (b) each of the
representations, undertakings and agreements herein made on the part of Global
Funding and any Issuing Trust is made and intended not as personal
representations, undertakings and agreements by Wilmington Trust Company but is
made and intended for the purpose for binding only Global Funding and the
relevant Issuing Trust, as applicable, (c) nothing herein contained shall be
construed as creating any liability on Wilmington Trust Company, individually or
personally, to perform any covenant either expressed or implied contained
herein, all such liability, if any, being expressly waived by the parties hereto
and by any person claiming by, through or under the parties hereto, and (d)
under no circumstances shall Wilmington Trust Company be personally liable for
the payment of any indebtedness or expenses of Global Funding or any Issuing
Trust or be liable for the breach or failure of any obligation, representation,
warranty or covenant made or undertaken by Global Funding or any Issuing Trust
under this Agreement or any other related documents.
***SIGNATURE PAGES FOLLOW***
37
If the foregoing is in accordance with the Agents' understanding of our
agreement, please sign and return to Global Funding a counterpart hereof,
whereupon this Agreement, along with all counterparts, will become a binding
agreement by and between the Agents and Global Funding in accordance with its
terms.
Very truly yours,
ALLSTATE LIFE GLOBAL FUNDING
By Wilmington Trust Company, not in its individual
capacity but solely as Delaware Trustee
By:
-------------------------------------------
Name:
Title:
CONFIRMED AND ACCEPTED, as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By:
---------------------------------------------------------
Authorized Signatory
A.G. EDWARDS & SONS, INC.
By:
---------------------------------------------------------
Authorized Signatory
BANC OF AMERICA SECURITIES LLC
By:
---------------------------------------------------------
Authorized Signatory
*Signature Page to Distribution Agreement, Part 1 of 4*
BARCLAYS CAPITAL INC.
By:
---------------------------------------------------------
Authorized Signatory
BEAR, STEARNS & CO. INC.
By:
---------------------------------------------------------
Authorized Signatory
CITIGROUP GLOBAL MARKETS INC.
By:
---------------------------------------------------------
Authorized Signatory
CREDIT SUISSE SECURITIES (USA) LLC
By:
---------------------------------------------------------
Authorized Signatory
DEUTSCHE BANK SECURITIES INC.
By:
---------------------------------------------------------
Authorized Signatory
By:
---------------------------------------------------------
Authorized Signatory
*Signature Page to Distribution Agreement, Part 2 of 4*
GOLDMAN SACHS & CO.
By:
---------------------------------------------------------
Authorized Signatory
GREENWICH CAPITAL MARKETS, INC.
By:
---------------------------------------------------------
Authorized Signatory
J.P. MORGAN SECURITIES INC.
By:
---------------------------------------------------------
Authorized Signatory
LEHMAN BROTHERS INC.
By:
---------------------------------------------------------
Authorized Signatory
MORGAN STANLEY & CO. INCORPORATED
By:
---------------------------------------------------------
Authorized Signatory
UBS SECURITIES LLC
By:
---------------------------------------------------------
Authorized Signatory
By:
---------------------------------------------------------
Authorized Signatory
*Signature Page to Distribution Agreement, Part 3 of 4*
WACHOVIA CAPITAL MARKETS, LLC
By:
---------------------------------------------------------
Authorized Signatory
*Signature Page to Distribution Agreement, Part 4 of 4*
Index of Exhibits and Schedules
Exhibits
Exhibit A - Opinion of Internal Counsel for the Company
Exhibit B - Negative Assurance Letter of Counsel for the Company
Exhibit C - Opinion of Counsel for the Company Concerning Certain Insolvency,
Funding Agreement Authority and Funding Agreement Enforceability
Matters
Exhibit D - Opinion of Counsel for the Company Concerning Certain Illinois
Security Interest Matters
Exhibit E - Opinion of Counsel for the Company Concerning Certain Federal
Securities and New York Matters
Exhibit F - Opinion of Counsel for the Company Concerning Certain Tax Matters
Exhibit G - Memorandum of Counsel for the Company Concerning Certain Insurance
Matters
Exhibit H - Negative Assurance Letter of Counsel for the Agents
Exhibit I - Opinion of Counsel for the Global Funding Delaware Trustee and the
Relevant Issuing Trust Trustee
Exhibit J - Opinion of Counsel for Global Funding Administrator and the Issuing
Trust Administrator Exhibit K - Opinion of Counsel for the
Indenture Trustee
Exhibit L - Opinion of Counsel for Global Funding and the relevant Issuing Trust
Concerning Certain Delaware Security Interest Matters
Exhibit M - Opinion of Counsel for Global Funding
Exhibit N - Opinion of Counsel for the relevant Issuing Trust
Exhibit O - Form of Comfort Letter of Deloitte & Touche LLP, Accountants to the
Company
Exhibit P - Form of Agent Accession Letter
Schedules
Schedule 1 - List of Agents
Schedule 2 - Commission/Discount Schedule for Retail Sales
Schedule 3 - Commission/Discount Schedule for Institutional Sales
i
Exhibit A - Opinion of Internal Counsel for the Company
[To Be Attached]
A-1
Exhibit B - Negative Assurance Letter of Counsel for the Company
[To Be Attached]
B-1
Exhibit C - Opinion of Counsel for the Company Concerning Certain
Insolvency, Funding Agreement Authority and Funding Agreement
Enforceability Matters
[To Be Attached]
C-1
Exhibit D - Opinion of Counsel for the Company Concerning Certain Illinois
Security Interest Matters
[To Be Attached]
D-1
Exhibit E - Opinion of Counsel for the Company Concerning Certain Federal
Securities and New York Matters
[To Be Attached]
E-1
Exhibit F - Opinion of Counsel for the Company Concerning Certain Tax Matters
[To Be Attached]
F-1
Exhibit G- Memorandum of Counsel for the Company Concerning Certain
Insurance Matters
[To Be Attached]
G-1
Exhibit H - Negative Assurance Letter of Counsel for the Agents
[To Be Attached]
H-1
Exhibit I - Opinion of Counsel for the Global Funding Delaware Trustee and
the Relevant Issuing Trust Trustee
[To Be Attached]
I-1
Exhibit J - Opinion of Counsel for Global Funding Administrator and the
Issuing Trust Administrator
[To Be Attached]
J-1
Exhibit K - Opinion of Counsel for the Indenture Trustee
[To Be Attached]
K-1
Exhibit L - Opinion of Counsel for Global Funding and the relevant Issuing
Trust Concerning Certain Delaware Security Interest Matters
[To Be Attached]
L-1
Exhibit M - Opinion of Counsel for Global Funding
[To Be Attached]
M-1
Exhibit N - Opinion of Counsel for the relevant Issuing Trust
[To Be Attached]
N-1
Exhibit O - Form of Comfort Letter of Deloitte & Touche LLP,
Accountants to the Company
[To Be Attached]
O-1
Exhibit P - Form of Agent Accession Letter
[Name of new Agent]
[Address]
Ladies and Gentlemen:
We refer to the Distribution Agreement, dated February [ ], 2006, entered into
in respect of the Secured Medium-Term Note Program (such agreement, as amended,
restated or modified from time to time, the "Distribution Agreement") among
ourselves and the Agents from time to time party thereto, and have the pleasure
of inviting you to become an Agent [but only in respect of [specify Issuing
Trust's Notes (the "Notes")]](1) subject to and in accordance with the terms of
the Distribution Agreement, a copy of which has been supplied to you by us. In
addition, we enclose letters from counsel to [__________] entitling you to rely
on the original letters referred to in Section 7(b) to the Distribution
Agreement, as such letters may have been amended or supplemented, together with
copies of such original, amended or supplemented letters. Please return to us a
copy of this letter signed by an authorized signatory whereupon you will become
an Agent for the purposes of the Distribution Agreement, with all the authority,
rights, powers, duties and obligations of an Agent under the Distribution
Agreement [except that, following the issue of the Notes, you shall have no
further authority, rights, powers, duties or obligations except such as may have
accrued or been incurred prior to, or in connection with, the issue of the
Notes].(2)
This letter is governed by, and shall be construed in accordance with, the laws
of the State of New York.
Yours faithfully,
ALLSTATE LIFE GLOBAL FUNDING
By:_________________________________
Name:
Title:
(1) Insert where the new Agent is being appointed only in relation to a
particular Issuing Trust.
(2) Insert where the new Agent is being appointed only in relation to a
particular Issuing Trust.
P-1
CONFIRMATION
We hereby accept the appointment as an Agent and accept all of the duties and
obligations under, and the terms and conditions of, the Distribution Agreement
upon the terms of this letter and affirm all representations, warranties and
covenants contained therein as of the applicable date [but only in respect of
[specify Issuing Trust's Notes]].(3)
We confirm that we are in receipt of all the documents which we have requested
and have found them to be satisfactory.
For the purposes of the Distribution Agreement, our communications details are
as set out below.
[NEW AGENT]
By:________________________________
Name:
Title:
Date: [__________]
Address: [__________]
Facsimile: [__________]
Attention: [__________]
Copies to:
The Indenture Trustee and the existing Paying Agent
[All existing Agents who have been appointed in respect of the Programs
generally](4)
(3) Insert where the new Agent is being appointed only in relation to a
particular Issuing Trust.
(4) Insert where the incoming Agent is being appointed in respect of the Program
generally.
P-2
Schedule 1
Merrill Lynch, Pierce, Fenner & Smith Incorporated
250 Vesey Street
New York, NY 10080
A.G. Edwards & Sons, Inc.
One North Jefferson Avenue
Saint Louis, MO 63103
Banc of America Securities LLC
9 West 57th Street
New York, NY 10019
Barclays Capital Inc.
200 Park Avenue
New York, NY 10166
Bear, Stearns & Co. Inc.
383 Madison Avenue
New York, NY 10174
Citigroup Global Markets Inc.
388 Greenwich Street
New York, NY 10013
Credit Suisse Securities (USA) LLC
Eleven Madison Avenue
New York, NY 10010
Deutsche Bank Securities Inc.
60 Wall Street
New York, NY 10005
Goldman, Sachs & Co.
85 Broad Street
New York, NY 10004
Greenwich Capital Markets, Inc.
600 Steamboat Road
Greenwich, CT 06830
J.P. Morgan Securities Inc.
270 Park Avenue
New York, NY 10017
Schedule 1-1
Lehman Brothers Inc.
745 7th Avenue
New York, NY 10019
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, NY 10036
UBS Securities LLC
677 Washington Blvd.
Stamford, CT 06901
Wachovia Capital Markets, LLC
301 South College Street
Charlotte, North Carolina 28288
Schedule 1-2
Schedule 2
PERCENT OF
MATURITY RANGES PRINCIPAL AMOUNT
- ---------------- ----------------
From 9 months to less than 1.5 years .125%
From 1.5 years to less than 2 years .200
From 2 years to less than 3 years .400
From 3 years to less than 4 years .625
From 4 years to less than 5 years .750
From 5 years to less than 6 years 1.000
From 6 years to less than 7 years 1.100
From 7 years to less than 8 years 1.200
From 8 years to less than 9 years 1.300
From 9 years to less than 10 years 1.400
From 10 years to less than 11 years 1.500
From 11 years to less than 12 years 1.600
From 12 years to less than 15 years 1.750
From 15 years to less than 20 years 2.000
From 20 years to 30 years 2.500
Schedule 2-1
Schedule 3
PERCENT OF
MATURITY RANGES PRINCIPAL AMOUNT
- --------------- ----------------
From 9 months to less than 2 years .150%
From 2 years to less than 3 years .200
From 3 years to less than 4 years .250
From 4 years to less than 5 years .300
From 5 years to less than 7 years .350
From 7 years to less than 10 years .400
From 10 years to less than 12 years .450
From 12 years to less than 15 years .475
From 15 years to less than 20 years .500
From 20 years to 30 years .875
Schedule 3-1
Exhibit 1.3
REPRESENTATIONS AND INDEMNITY AGREEMENT
[ ], 2006
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
A.G. Edwards & Sons, Inc.
Banc of America Securities LLC
Barclays Capital Inc.
Bear, Stearns & Co. Inc.
Citigroup Global Markets Inc.
Credit Suisse Securities (USA) LLC
Deutsche Bank Securities Inc.
Goldman, Sachs & Co.
Greenwich Capital Markets, Inc.
J.P. Morgan Securities Inc.
Lehman Brothers Inc.
Morgan Stanley & Co. Incorporated
UBS Securities LLC
Wachovia Capital Markets, LLC
Ladies and Gentlemen:
Allstate Life Insurance Company, an Illinois stock life insurance company
(the "Company"), in connection with the Allstate Life Global Funding Secured
Medium Term Notes Program (the "Institutional Program") and the Allstate Life(R)
CoreNotes(R) Program (the "Retail Program" and, together with the Institutional
Program, the "Programs"), and in consideration of the Distribution Agreement
dated [ ], 2006, as amended, restated or modified from time to time (the
"Distribution Agreement"), by and among Merrill Lynch, Pierce, Fenner & Smith
Incorporated and each other institution named on Schedule 1 thereto (each, an
"Agent" and, collectively the "Agents") on the one hand, and Allstate Life
Global Funding, a Delaware statutory trust ("Global Funding") and any Delaware
statutory trust formed, and beneficially owned, by Global Funding (each, an
"Issuing Trust" and, collectively, the "Issuing Trusts") that becomes a party to
the Distribution Agreement pursuant to the terms thereof and the applicable
terms agreement (each, a "Terms Agreement") set forth in Part E of the series
instrument to be executed by each Issuing Trust, Global Funding and the
applicable Agent or Agents, among others, confirms its agreement with the Agents
with respect to the issue and sale, from time to time by the Issuing Trusts, of
notes due between nine months and thirty years from the date of issuance (the
"Notes").
The Notes of each Issuing Trust will be issued pursuant to an indenture, as
amended or modified from time to time, which will adopt and incorporate the
standard indenture terms (each, an "Indenture" and, collectively, the
"Indentures") between the relevant Issuing Trust and J.P. Morgan Trust Company,
National Association, as indenture trustee (the "Indenture Trustee"). Each
Issuing Trust shall issue only one series of Notes. As of the date of this
Agreement, the
- ------------------------
Allstate Life(R) is a registered service mark of Allstate Insurance Company.
CoreNotes(R) is a registered service mark of Merrill Lynch & Co.
Issuing Trusts are authorized to issue collectively up to U.S. $5,000,000,000
aggregate initial offering price of Notes (or its equivalent as determined in
Section 4(s) of the Distribution Agreement).
Each Issuing Trust will use the proceeds from the sale of its Notes
immediately to purchase a funding note (each a "Funding Note") issued by Global
Funding. Each Funding Note will be issued pursuant to a funding note indenture,
as amended or modified from time to time, which will adopt and incorporate the
standard funding note indenture terms (each, a "Funding Note Indenture") between
Global Funding and J.P. Morgan Trust Company, National Association, as the
funding note indenture trustee (the "Funding Note Indenture Trustee"). Global
Funding will immediately use the net proceeds received from the sale of the
applicable Funding Note to purchase a funding agreement (each a "Funding
Agreement") issued by the Company. Global Funding will immediately assign
absolutely to, and deposit into the relevant Issuing Trust, the relevant Funding
Agreement(s) and the relevant Funding Note will be surrendered. In connection
with the sale of its Notes, the Issuing Trust will prepare a Pricing Supplement
(the "Pricing Supplement") including or incorporating by reference a description
of the terms of the Notes and the terms of the offering.
Capitalized terms used herein and not otherwise defined herein shall have
the meaning ascribed to them in the Distribution Agreement.
The Agents include those institutions named from time to time in Schedule 1
to the Distribution Agreement and pursuant to Section 14 of this Agreement. If
any institution is appointed as an Agent only with respect to the Notes of a
particular Issuing Trust, such institution shall only be an Agent with respect
to the Notes of such Issuing Trust.
The Company has registered shares of its common stock with the Securities
and Exchange Commission (the "Commission") pursuant to Section 12(g) of the
Securities Exchange Act of 1934, as amended (the "1934 Act") on Form 10 under
the 1934 Act. Pursuant to Rule 429 of the rules and regulations of the
Commission under the Securities Act of 1933. as amended (the "1933 Act
Regulations"), the Company and Global Funding have filed with the Commission (i)
a registration statement on Form S-3 (No. 333-129157) and pre-effective
amendment No. 1 thereto under the Securities Act of 1933, as amended (the "1933
Act") for the registration of the Funding Agreements, the Funding Notes, and the
Notes, and the offering thereof in accordance with Rule 415 of the 1933 Act
Regulations, (ii) the related prospectus dated [ ], 2006 covering the Notes
offered under the Programs (the "Base Prospectus"); (iii) the prospectus
supplement to the Base Prospectus, dated [ ], 2006, covering the Notes offered
under the Institutional Program (the "Institutional Prospectus Supplement" and
together with the Base Prospectus, the "Institutional Base Prospectus"); and
(iv) the prospectus supplement to the Base Prospectus, dated [ ], 2006, covering
the Notes offered under the Retail Program (the "Retail Prospectus Supplement"
and, together with the Base Prospectus, the "Retail Base Prospectus"). Such
registration statement (as so amended , if applicable) is also the first
post-effective amendment to registration statement on Form S-3 (No. 333-125937)
filed by the Company and Global Funding. The registration statement on Form S-3
(No. 333-129157) (as so amended, if applicable) has been declared effective by
the Commission, and the form of Indenture and the form of Funding Note Indenture
have been duly qualified under the Trust Indenture Act of 1939, as amended (the
"1939 Act"), and the Company and Global
2
Funding have filed such post-effective amendments thereto as may be required
prior to the acceptance by Global Funding and any Issuing Trust of any offer for
the purchase of Notes and each such post-effective amendment has been declared
effective by the Commission. Such registration statement on Form S-3 (No.
333-129157), at any relevant time, including the amendments thereto to such
time, the exhibits and any schedules thereto at such time, the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933
Act at such time and the documents otherwise deemed to be a part thereof or
included therein by the 1933 Act Regulations is referred to herein as the
"Registration Statement". If the Company or Global Funding file a registration
statement with the Commission pursuant to Rule 462(b) of the 1933 Act
Regulations (the "Rule 462(b) Registration Statement"), then, after such filing,
all references to the "Registration Statement" shall also be deemed to include
the Rule 462(b) Registration Statement. With respect to the offering of a series
of Notes under the Institutional Program, the Institutional Base Prospectus, and
with respect to the offering of a series of Notes under the Retail Program, the
Retail Base Prospectus, in each case including the Pricing Supplement relating
to the offering of such series of Notes, in the form first filed with the
Commission pursuant to Rule 424(b) of the 1933 Act Regulations (or in the form
first made available to the applicable Agent(s) by the Company and the
applicable Issuing Trust to meet requests of purchasers pursuant to Rule 173
under the 1933 Act Regulations), are referred to herein as the "Prospectus." The
term "preliminary prospectus" means any preliminary form of the Prospectus. For
all purposes of this Agreement, the term "free writing prospectus" has the
meaning set forth in Rule 405 under the 1933 Act Regulations and the term "Time
of Sale Prospectus" means (i) with respect to the offer and sale of any series
of Notes under the Institutional Program, the Institutional Base Prospectus and
(ii) with respect to the offer and sale of any series of Notes under the Retail
Program, the Retail Base Prospectus, in each case as amended or supplemented
from time to time, together with any other preliminary prospectus relating to
the offer and sale of such series of Notes, any Pricing Supplement relating to
the offer and sale of such series of Notes filed with the Commission prior to
the Applicable Time and each free writing prospectus (including any final term
sheet relating to such series of Notes) attached as, or identified in, Exhibit A
to the applicable Terms Agreement and any other information identified in
Exhibit A to the applicable Terms Agreement. All references to the "Registration
Statement", the "Institutional Base Prospectus", the "Retail Base Prospectus",
any "preliminary prospectus", the "Time of Sale Prospectus" and the "Prospectus"
shall also be deemed to include all amendments and supplements thereto and all
documents incorporated by reference therein. All references to the Registration
Statement, Time of Sale Prospectus, Prospectus, any preliminary prospectus or
free writing prospectus or to any amendment or supplement thereto shall be
deemed to include any copy filed with the Commission pursuant to its Electronic
Data Gathering, Analysis and Retrieval system ("EDGAR").
All references in this Agreement to financial statements and schedules and
other information which is "disclosed", "contained", "included" or "stated" (or
other references of like import) in the Registration Statement, Time of Sale
Prospectus, Prospectus, any preliminary prospectus or free writing prospectus
shall be deemed to include all such financial statements and schedules and other
information which is incorporated by reference in or otherwise deemed by the
1933 Act Regulations to be a part of or included in the Registration Statement,
Time of Sale Prospectus, any preliminary prospectus or free writing prospectus,
as the case may be; and all references in this Agreement to amendments or
supplements to the Registration Statement, Time of Sale Prospectus,
Institutional Base Prospectus, Retail Base Prospectus, Prospectus, any
3
preliminary prospectus or free writing prospectus shall be deemed to include all
documents subsequently filed with the Commission pursuant to the 1934 Act which
is incorporated by reference in or otherwise deemed by the 1933 Act Regulations
to be part of or included in the Registration Statement, Institutional Base
Prospectus, Retail Base Prospectus, Prospectus, any preliminary prospectus or
free writing prospectus, as the case may be.
SECTION 1. Representations and Warranties.
(a) The Company represents and warrants to each Agent as of the date
hereof, to the applicable Agent(s) as of the Applicable Time (as defined in the
applicable Terms Agreement, for the relevant Issuing Trust, the "Applicable
Time"), to the applicable Agent(s) as of the date of each delivery of Notes
(whether to such Agent as principal or through such Agent as agent) (the date of
each such delivery is referred to herein as a "Settlement Date"), to each Agent
as of any time the Time of Sale Prospectus shall be amended or supplemented, and
to each Agent as of any time that the Registration Statement or the Prospectus
shall be amended or supplemented (each of the times referenced above is referred
to herein as a "Representation Date"), as follows:
(i) Due Incorporation, Good Standing and Due Qualification of the
Company. The Company is validly existing as a stock life insurance company
in good standing under the laws of the State of Illinois with corporate
power and authority to own, lease and operate its properties and to conduct
its business as described in the Time of Sale Prospectus and to enter into
this Agreement and consummate the transactions to be performed by the
Company as contemplated in the Time of Sale Prospectus; the Company is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct of
business, except where the failure to comply with any of the foregoing
would not result in a material adverse change in the condition (financial
or otherwise) or in the earnings or business affairs of the Company and its
subsidiaries considered as one enterprise or on the power or ability of the
Company to perform its obligations under the Program Documents (as defined
in the applicable Indenture or form of Indenture, as the case may be) to
which the Company is a party or to consummate the transactions to be
performed by the Company as contemplated in the Time of Sale Prospectus (a
"Company Material Adverse Effect"); all of the issued and outstanding
shares of capital stock of the Company have been duly authorized and are
validly issued, fully paid and non-assessable; and none of the outstanding
shares of capital stock of the Company were issued in violation of
preemptive or other similar rights of any securityholder of the Company.
(ii) Due Incorporation, Good Standing and Due Qualification of
Significant Subsidiaries. Each significant subsidiary (as such term is
defined in Rule 1-02 of Regulation S-X promulgated under the 1933 Act) of
the Company, if any (each, a "Significant Subsidiary") is validly existing
as a corporation in good standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease and operate
its properties and conduct its business as described in the Time of Sale
Prospectus and is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by
4
reason of the ownership or leasing of property or the conduct of business,
except where the failure to comply with any of the foregoing would not
result in a Company Material Adverse Effect; all of the issued and
outstanding shares of capital stock of each Significant Subsidiary has been
duly authorized and is validly issued, fully paid and non-assessable and is
100% owned by the Company, directly or through subsidiaries, free and clear
of any security interest, mortgage, pledge, lien, encumbrance, claim or
equity; and none of the outstanding shares of capital stock of any
Significant Subsidiary was issued in violation of preemptive or other
similar rights of any securityholder of such Significant Subsidiary.
(iii) Registration Statement Preliminary Prospectuses, Time of Sale
Prospectus, and Prospectus; Filing Status. Each of the Company and Global
Funding meet the requirements for use of Form S-3 under the 1933 Act; the
Registration Statement has become effective under the 1933 Act and no stop
order suspending the effectiveness of the Registration Statement has been
issued under the 1933 Act and no proceedings for that purpose have been
instituted or are pending or, to the knowledge of the Company are
contemplated by the Commission, and any request on the part of the
Commission for additional information has been complied with; the form of
Indenture has been duly qualified under the 1939 Act; the form of Funding
Note Indenture has been duly qualified under the 1939 Act; at the
respective times that each part of the Registration Statement became
effective and at each Representation Date, the Registration Statement and
any amendments thereto complied and will comply in all material respects
with the applicable requirements of the 1933 Act and the 1933 Act
Regulations, the 1934 Act and the 1934 Act Regulations and the 1939 Act and
the 1939 Act Regulations and did not 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; each preliminary prospectus and Prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act Regulations,
complied when so filed in all material respects with the 1933 Act and the
1933 Act Regulations; each preliminary prospectus and the Prospectus
delivered to an Agent for use in connection with the offering of Notes are
identical in all material respects to any electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T; and at the date hereof, at the date of the
Base Prospectus and each amendment or supplement thereto and at each
Representation Date, neither the Base Prospectus nor any amendment or
supplement thereto included or will include an untrue statement of a
material fact or omitted or will omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The Time of Sale Prospectus
does not, and at the Applicable Time and at the applicable Settlement Date,
the Time of Sale Prospectus, as then amended or supplemented, if
applicable, will not, contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading;
provided, however, that the representations and warranties in this
subsection shall not apply to (i) statements in or omissions from the
Registration Statement, the Base Prospectus, the Time of Sale Prospectus or
the Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by the applicable Agents concerning
5
such Agents expressly for use in the Registration Statement, the Base
Prospectus, the Time of Sale Prospectus or the Prospectus, or (ii) the
parts of the Registration Statement which constitute the Statement of
Eligibility and Qualification (Form T-1) of the Indenture Trustee under the
1939 Act.
(iv) Incorporated Documents. The documents incorporated or deemed to
be incorporated by reference in the Time of Sale Prospectus or the Base
Prospectus, as amended or supplemented, at the time they were or hereafter
are filed with the Commission, complied and will comply in all material
respects with the requirements of the 1934 Act and the 1934 Act Regulations
and, when read together with the other information in the Time of Sale
Prospectus or the Base Prospectus, at the date hereof, at the date of the
Time of Sale Prospectus or the Base Prospectus and at each Representation
Date, did not and will not include an untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
(v) Free Writing Prospectuses. At the time of initial filing of the
Registration Statement, at the earliest time thereafter that an offering
participant made a bona fide offer (within the meaning of Rule 164(h)(2) of
the 1933 Act Regulations) of any Notes and at each the Company
Representation Date, the Company was not and is not an "ineligible issuer,"
as defined in Rule 405 of the 1933 Act Regulations. Any free writing
prospectus that the Company is required to file pursuant to Rule 433(d)
under the 1933 Act Regulations has been, or will be, filed with the
Commission in accordance with the requirements of the 1933 Act and the 1933
Act Regulations. Each free writing prospectus that the Company has filed,
or is required to file, pursuant to Rule 433(d) under the 1933 Act
Regulations or that was prepared by or on behalf of or used by the Company
complies or will comply in all material respects with the requirements of
the applicable 1933 Act Regulations. With respect to the offering of any
series of Notes, except for the free writing prospectuses attached as, or
identified in, Exhibit A to the applicable Terms Agreement, the Company has
not prepared, used or referred to, and will not, without the prior consent
of the applicable Agents, prepare, use or refer to, any free writing
prospectus or any other marketing materials other than the preliminary
prospectus relating to or to be used in connection with any offer or sale
of the Notes. No free writing prospectus used in connection with the
offering of a series of Notes will conflict with either the Registration
Statement or the Base Prospectus.
(vi) Independent Registered Public Accounting Firm. The accounting
firm which certified the financial statements and any supporting schedules
thereto included in the Registration Statement and the Base Prospectus, as
amended or supplemented, is an independent registered public accounting
firm to the extent required by the 1933 Act and the 1933 Act Regulations.
(vii) Company Financial Statements. The consolidated financial
statements of the Company included in the Registration Statement, the Time
of Sale Prospectus and the Base Prospectus together with the related
schedules and notes, as well as those financial statements, schedules and
notes of any entity included in the Registration Statement, the Time of
Sale Prospectus and the Base Prospectus present fairly the consolidated
6
financial position of the Company and its subsidiaries, or such other
entity, as the case may be, at the dates indicated and the consolidated
statement of operations, stockholders' equity and cash flows of the Company
and its subsidiaries, or such other entity, as the case may be, for the
periods specified; such financial statements have been prepared in
conformity with GAAP applied on a consistent basis throughout the periods
involved; the supporting schedules, if any, included in the Registration
Statement, the Time of Sale Prospectus and the Base Prospectus present
fairly in accordance with GAAP the information required to be stated
therein; the selected financial data and the summary financial information
included in the Registration Statement, the Time of Sale Prospectus and the
Base Prospectus present fairly the information shown therein and have been
compiled on a basis consistent with that of the audited financial
statements included in the Registration Statement, the Time of Sale
Prospectus and the Base Prospectus; and any pro forma consolidated
financial statements of the Company and its subsidiaries and the related
notes thereto included in the Registration Statement, the Time of Sale
Prospectus and the Base Prospectus present fairly the information shown
therein, have been prepared in accordance with the Commission's rules and
guidelines with respect to pro forma financial statements and have been
properly compiled on the bases described therein, and the assumptions used
in the preparation thereof are reasonable and the adjustments used therein
are appropriate to give effect to the transactions and circumstances
referred to therein.
(viii) No Material Changes. Since the respective dates as of which
information is given in the Registration Statement and the Time of Sale
Prospectus, except as otherwise stated therein, (1) there has been no event
or occurrence that would result in a Company Material Adverse Effect and
(2) there have been no transactions entered into by the Company or any of
its Significant Subsidiaries, other than those in the ordinary course of
business, which are material with respect to the Company and its
subsidiaries considered as one enterprise.
(ix) Authorization of this Agreement and each Funding Agreement. This
Agreement has been and each Funding Agreement when issued will be duly
authorized, executed and delivered by the Company and will be a valid and
legally binding agreement of the Company, enforceable against the Company
in accordance with its terms, except as enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally or by general
equitable principles (regardless of whether enforcement is considered in a
proceeding in equity or at law).
(x) Absence of Defaults and Conflicts. Neither the Company nor any of
its subsidiaries is in violation of the provisions of its charter or
by-laws or in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, lease or other
agreement or instrument to which the Company or any of its subsidiaries is
a party or by which it or any of them may be bound or to which any of the
property or assets of the Company or any of its subsidiaries is subject
(collectively, "Company Agreements and Instruments"), except for such
defaults that would not result in a Company Material Adverse Effect; the
execution, delivery and performance of this
7
Agreement, each Funding Agreement and any other agreement or instrument
entered into or issued or to be entered into or issued by the Company in
connection with the transactions contemplated in the Time of Sale
Prospectus, the consummation of the transactions contemplated in the Time
of Sale Prospectus (including the issuance and sale of the Notes and the
use of the proceeds therefrom as described in the Time of Sale Prospectus)
and the compliance by the Company with its obligations thereunder have been
duly authorized by all necessary corporate action and do not and will not,
whether with or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or event or condition
which gives the holder of any note, debenture or other evidence of
indebtedness (or any person acting on such holder's behalf) the right to
require the repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any of its Significant Subsidiaries under,
or result in the creation or imposition of any lien, charge or encumbrance
upon any assets, properties or operations of the Company or any of its
subsidiaries pursuant to, any Company Agreements and Instruments, nor will
such action result in any violation of the provisions of the charter,
articles or by-laws of the Company or any of its subsidiaries or any
applicable law, statute, rule, regulation, judgment, order, writ or decree
of any government, government instrumentality or court, domestic or
foreign, having jurisdiction over the Company or any of its subsidiaries or
any of their assets, properties or operations.
(xi) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or to the knowledge of
the Company threatened, against or affecting the Company which is required
to be disclosed in the Registration Statement and the Base Prospectus
(other than as stated therein), or which may reasonably expected to result
in a Company Material Adverse Effect; and the aggregate of all pending
legal or governmental proceedings to which the Company is a party or of
which any of its assets, properties or operations is the subject which are
not described in the Registration Statement and the Base Prospectus, as
amended or supplemented, including ordinary routine litigation incidental
to the business, may not reasonably be expected to result in a Company
Material Adverse Effect.
(xii) Possession of Licenses and Permits. The Company and its
subsidiaries possess such permits, licenses, approvals, consents and other
authorizations (collectively, "Company Governmental Licenses") issued by
the appropriate federal, state, local or foreign regulatory agencies or
bodies necessary to conduct the business now operated by them; the Company
and its subsidiaries are in compliance with the terms and conditions of all
such Company Governmental Licenses, except where the failure so to comply
would not, singly or in the aggregate, result in a Company Material Adverse
Effect; all of the Company Governmental Licenses are valid and in full
force and effect, except where the invalidity of such Company Governmental
Licenses or the failure of such Company Governmental Licenses to be in full
force and effect would not result in a Company Material Adverse Effect.
Except as set forth in the Time of Sale Prospectus, neither the Company nor
any of its subsidiaries has received any notice of proceedings relating to
the revocation or modification of any such Company Governmental Licenses
which, singly
8
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would result in a Company Material Adverse Effect.
(xiii) No Filings, Regulatory Approvals etc. Other than the filing of
the applicable financing statements, if any, no filing with, or approval,
authorization, consent, license, registration, qualification, order or
decree of, any court or governmental authority or agency, domestic or
foreign, is necessary or required for the due authorization, execution and
delivery by the Company of this Agreement, each Funding Agreement or the
Program Documents or for the performance by the Company of the transactions
contemplated in this Agreement, each Funding Agreement, the Program
Documents or the Prospectus, except such as have been previously made,
obtained or rendered, as applicable.
(xiv) Investment Company Act. None of the Company, Global Funding and
the relevant Issuing Trust is, and upon the sale of the Funding Agreements,
the Funding Notes and Notes as contemplated by the Programs and the
application of the net proceeds therefrom as described in the Time of Sale
Prospectus, will be, an "investment company" within the meaning of the
Investment Company Act of 1940, as amended (the "1940 Act").
(xv) Absence of Default Under Each Funding Agreement. There exists no
event or circumstance which does or may (with the passing of time, the
giving of notice, the making of any determination, or any combination
thereof) be reasonably expected to constitute an event of default under any
outstanding Funding Agreement.
(xvi) Funding Agreement Listed on any Stock Exchange. If specified in
a Pricing Supplement, the Funding Agreement described in such Pricing
Supplement shall be listed on the securities exchange designated in such
Pricing Supplement.
(xvii) Relationship between the Company and the Agents. The Company
acknowledges and agrees that (i) the purchase and sale of the Notes
pursuant to the Distribution Agreement, including the determination of the
offering price of the Notes and any related discounts and commissions, is
an arm's-length commercial transaction between Global Funding, on the one
hand, and the Agents, on the other hand, (ii) in connection with the
offerings contemplated by the Distribution Agreement and the process
leading to such transactions each Agent is and has been acting solely as a
principal and is neither the agent of Global Funding and the Company nor
their fiduciary, respectively, or its stockholders, creditors, employees or
any other party, (iii) no Agent has assumed or will assume an advisory or
fiduciary responsibility in favor of Global Funding or the Company with
respect to the offerings contemplated hereby or the process leading thereto
(irrespective of whether such Agent has advised or is currently advising
Global Funding or the Company on other matters) and no Agent has any
obligation to Global Funding or the Company with respect to the offerings
contemplated hereby except the obligations expressly set forth in this
Agreement, (iv) the Agents and their respective affiliates may be engaged
in a broad range of transactions that involve interests that differ from
those of Global Funding or the Company, and (v) the Agents have not
provided any legal, accounting, regulatory or tax advice with respect to
the offerings contemplated
9
hereby and Global Funding and the Company have consulted their own legal,
accounting, regulatory and tax advisors to the extent they deemed
appropriate.
(b) Additional Certifications. Any certificate signed by any officer of the
Company and delivered to one or more Agents or to counsel for the Agents in
connection with an offering of Notes by an Issuing Trust to one or more Agents
as principal or through an Agent as agent shall be deemed a representation and
warranty by the Company to such Agent(s) as to the matters covered thereby on
the date of such certificate and, unless subsequently amended or supplemented,
at each Representation Date subsequent thereto.
SECTION 2. Covenants of the Company.
The Company covenants and agrees with each Agent as follows:
(a) Notice of Certain Events. The Company will notify the Agents
immediately, and confirm such notice in writing of (i) the effectiveness of any
post-effective amendment to the Registration Statement or the filing of any
amendment or supplement to the Time of Sale Prospectus or the Prospectus (other
than any amendment or supplement thereto providing solely for the determination
of the variable terms of the Notes), (ii) the receipt of any comments from the
Commission with respect to the Registration Statement, any preliminary
prospectus and the Prospectus, (iii) any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement to the
Base Prospectus, (iv) the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or Form 10, or of any
order preventing or suspending the use of any preliminary prospectus or
Prospectus, or of the initiation of any proceedings for that purpose, or (v) the
failure of the Funding Agreements to be qualified for sale under the securities
or blue sky laws of such jurisdiction as the Agents may request pursuant to
Section 2(r). With respect to the Registration Statement, any preliminary
prospectus and the Prospectus, the Company will make every reasonable effort to
prevent the issuance of any stop order (or any similar order under blue sky
laws) and, if any stop order (or any similar order under blue sky laws) is
issued, to obtain the lifting thereof at the earliest possible moment.
(b) Filing or Use of Amendments. The Company will give each Agent advance
notice of its intention to file or prepare any additional registration statement
with respect to the registration of additional Funding Agreements, any amendment
to the Registration Statement (including any filing under Rule 462(b) of the
1933 Act Regulations) or any amendment or supplement to any preliminary
prospectus or to the Prospectus (other than an amendment or supplement thereto
providing solely for the determination of the variable terms of the Notes),
whether pursuant to the 1933 Act, the 1934 Act or otherwise, and will provide
immediate notice to each relevant Agent of any intention to prepare an amendment
or supplement to the Time of Sale Prospectus and, if applicable to file such
amendment or supplement pursuant to the 1933 Act, and will furnish to such
Agents copies of any such document a reasonable amount of time prior to such
proposed filing or the use of such materials, as the case may be, and will not
file or use any such document to which an Agent or counsel for the Agents shall
object.
(c) Revisions of Registration Statement. If at any time during the term of
this Agreement any event shall occur or condition shall exist as a result of
which it is necessary, in
10
the reasonable opinion of counsel for the Agents or counsel for the Company, to
amend the Registration Statement in order that the Registration Statement 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, or if it shall be necessary, in the reasonable opinion of either
such counsel, to amend the Registration Statement in order to comply with the
requirements of the 1933 Act or the 1933 Act Regulations, the Company shall give
immediate notice, confirmed in writing, to the Agents to cease the solicitation
of offers for the purchase of Notes and to cease sales of any Notes they may
then own, and the Company will promptly prepare and file with the Commission,
subject to Section 2(b) hereof, such amendment as may be necessary to correct
such statement or omission or to make the Registration Statement comply with
such requirements, and the Company will furnish to the Agents, without charge,
such number of copies of such amendment as the Agents may reasonably request.
(d) Use of Free Writing Prospectuses. The Company will not take any action
that would result in an Agent being required to file with the Commission
pursuant to Rule 433(d) of the 1933 Act Regulations a free writing prospectus
prepared by or on behalf of an Agent that such Agent otherwise would not have
been required to file thereunder.
(e) Revisions of Time of Sale Prospectuses. If the Time of Sale Prospectus
is being used to solicit offers to buy any Notes of a series at a time when the
Prospectus is not yet available to prospective purchasers and any event shall
occur or condition shall exist as a result of which it is necessary, in the
reasonable opinion of counsel for the applicable Agent(s) or counsel for the
Company, to amend or supplement the Time of Sale Prospectus in writing in order
that the Time of Sale Prospectus will not include an untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein not misleading in the light of the circumstances existing at
the time the Time of Sale Prospectus is conveyed to a prospective purchaser, or
if, in the reasonable opinion of either such counsel, it is necessary to amend
or supplement the Time of Sale Prospectus to comply with the 1933 Act or 1933
Act Regulations, the Company shall give notice, confirmed in writing, to each of
the applicable Agents and the Company will promptly prepare and, if applicable,
file with the Commission such amendment or supplement as may be necessary to
correct such statement or omission or to make the Time of Sale Prospectus comply
with such requirements, and the Company will furnish to each of the applicable
Agents, without charge, such number of copies of such amendment or supplement,
as the relevant Agents may reasonably require.
(f) Delivery of the Registration Statement. The Company will furnish to the
Agents and to counsel for the Agents, without charge, signed and conformed
copies of the Registration Statement and conformed copies of all consents and
certificates of experts. The Registration Statement furnished to an Agent will
be identical in all material respects to any electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T.
(g) Delivery of the Preliminary Prospectus and Time of Sale Prospectus.
Pursuant to the Distribution Agreement, Global Funding will deliver to each
applicable Agent, without charge, as many copies of each preliminary prospectus
as such Agent may reasonably request, and the Company hereby consents to the use
of such copies for purposes permitted by the 1933 Act. Pursuant to the
Distribution Agreement, Global Funding will furnish to each applicable
11
Agent, without charge, such number of copies of the applicable Time of Sale
Prospectus as such Agent may reasonably request, and the Company hereby consents
to the use of such copies for purposes permitted by the 1933 Act. Each such
document furnished to the applicable Agents will be identical to any
electronically transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation S-T.
(h) Delivery of Free Writing Prospectuses. The Company will deliver to each
applicable Agent and, without charge, as many copies of each free writing
prospectus, prepared by or on behalf of, used by, or referred to by the Company,
as such Agent may reasonably request. To the extent applicable, each such
document furnished to the Agents will be identical to any electronically
transmitted copies thereof filed with the Commission pursuant to EDGAR, except
to the extent permitted by Regulation S-T.
(i) Delivery of the Prospectus. Pursuant to the Distribution Agreement,
Global Funding will deliver to each applicable Agent, without charge, as many
copies of the relevant Prospectus (as amended or supplemented) as such Agent may
reasonably request; the Company hereby consents to the use of such copies for
purposes permitted by the 1933 Act. It is hereby acknowledged that Global
Funding intends to rely on the provisions of Rule 172 of the 1933 Act
Regulations with respect to the delivery of the Prospectus. The Prospectus and
any amendments or supplements thereto furnished to such Agent will be identical
in all material respects to any electronically transmitted copies thereof filed
with the Commission pursuant to EDGAR, except to the extent permitted by
Regulation S-T.
(j) Periodic Financial Information. On or prior to the date on which there
shall be released to the general public interim financial statement information
related to the Company with respect to each of the first three quarters of any
fiscal year or preliminary financial statement information with respect to any
fiscal year, the Company shall furnish such information to the Agents, confirmed
in writing.
(k) Audited Financial Information. On or prior to the date on which there
shall be released to the general public financial information included in or
derived from the audited consolidated financial statements of the Company for
the preceding fiscal year, the Company shall furnish such information to the
Agents, confirmed in writing.
(l) Reporting Requirements. The Company, during the period when the Time of
Sale Prospectus is required to be delivered under the 1933 Act or the 1934 Act,
will file, and will cause to be filed, all documents required to be filed with
the Commission pursuant to the 1934 Act within the time periods prescribed by
the 1934 Act and the 1934 Act Regulations.
(m) Earnings Statements. The Company will timely file such reports pursuant
to the 1934 Act and the 1934 Act Regulations, as are necessary in order to make
generally available to its securityholders as soon as practicable an earnings
statement for the purposes of, and to provide the benefits contemplated by, the
last paragraph of Section 11(a) of the 1933 Act.
(n) Use of Proceeds. The Company will use the net proceeds received by it
from the issuance and sale of the Funding Agreements in the manner specified in
the Time of Sale Prospectus.
12
(o) Authorization to Act on Behalf of the Company. The Company will, from
time to time, without request, deliver to the Agents a certificate as to the
names and signatures of those persons authorized to act on behalf of the Company
in relation to the Programs if such information has changed.
(p) Restrictions on the Offer and Sale of Funding Agreements. Except in
connection with the Retail Program and as otherwise agreed, the Company shall
not issue or agree to issue, during the period commencing on the date of the
agreement of an Agent(s) to purchase Notes as principal or solicit offers for
the purchase of Notes as agent and continuing to and including the Settlement
Date with respect to such Notes, any Funding Agreement or similar agreement for
the purpose of supporting the issuance by a special purpose entity of securities
substantially similar to such Notes to the same potential investors (other than
any Funding Agreement issued or to be issued to the relevant Issuing Trust in
connection with the Notes to be offered and/or sold to or through such Agents),
in each case without prior notice to the applicable Agent(s). Notwithstanding
the foregoing, the Company shall be permitted to issue or agree to issue, during
the aforementioned time period, Funding Agreements or similar agreements to
Allstate Life Funding, LLC.
(q) Blue Sky Qualifications. The Company shall endeavor to qualify the
Funding Agreements for offer and sale under the securities or blue sky laws of
such jurisdictions as the Agents shall reasonably request and to maintain such
qualifications for as long as such Agents shall reasonably request.
SECTION 3. Covenants of the Agents.
(a) The Agents shall comply with all of their obligations under the
Distribution Agreement.
(b) The Agents shall not agree to any amendment or modification of the
Distribution Agreement without the prior written consent of the Company.
SECTION 4. Additional Covenants of the Company.
The Company further covenants and agrees with each Agent as follows:
(a) Reaffirmation of Representations and Warranties. Each acceptance by
Global Funding and an Issuing Trust of an offer for the purchase of Notes
(whether to one or more Agents as principal or through one or more Agents as
agent), and each delivery of its Notes (whether to one or more Agents as
principal or through an Agent as agent) shall be deemed to be an affirmation
that the representations and warranties of the Company contained in any
certificate theretofore delivered to such Agent pursuant hereto are true and
correct at the time of such acceptance or sale, as the case may be, and an
undertaking that such representations and warranties will be true and correct at
the time of delivery to such Agent(s) or to the purchaser or its agent, as the
case may be, of the Notes relating to such acceptance or sale, as the case may
be, as though made at and as of each such time (it being understood that such
representations and warranties shall relate to the Registration Statement and
Prospectus as amended and supplemented to each such time).
13
(b) Subsequent Delivery of Certificates. Each time that (i) the
Registration Statement or Prospectus shall be amended or supplemented (other
than by (A) an amendment or supplement providing solely for the determination of
the variable terms of the Notes and (B) an amendment deemed to have occurred as
a result of a periodic filing by the Company, Global Funding or any Issuing
Trust under the 1934 Act or the 1934 Act Regulations, except any quarterly
report of the Company on Form 10-Q or any annual report of the Company on Form
10-K (any such report, an "SEC Periodic Report")), and (ii) (if required in
connection with the purchase of Notes from an Issuing Trust by one or more
Agents as principal) an Issuing Trust sells Notes to one or more Agents as
principal or (iii) an Issuing Trust sells Notes in a form not previously
certified to the Agents by such Issuing Trust, the Company shall furnish or
cause to be furnished to the Agents, forthwith a certificate dated the date of
filing with the Commission or the date of effectiveness of such amendment or
supplement, as applicable, or the date of such sale, as the case may be, in form
satisfactory to the Agents to the effect that the statements contained in the
certificate referred to in Section 7(d) of the Distribution Agreement which were
last furnished to the Agents are true and correct at the time of the filing or
effectiveness of such amendment or supplement, as applicable, or the time of
such sale, as the case may be, as though made at and as of such time (except
that such statements shall be deemed to relate to the Registration Statement as
amended and supplemented to such time) or, in lieu of such certificate, a
certificate of the same tenor as the certificate referred to in Section 7(d) of
the Distribution Agreement, modified as necessary to relate to the Registration
Statement as amended and supplemented to the time of delivery of such
certificate (it being understood that, in the case of clause (ii) above, any
such certificate shall also include a certification that there has been no
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise since the date of the agreement by
such Agent to purchase Notes from the relevant Issuing Trust as principal);
provided, however, that any delivery of certificates as required by this Section
4(b) due to the filing of an SEC Periodic Report shall only be required to be
delivered prior to the pricing date for Notes issued immediately after such SEC
Periodic Report.
(c) Company Officer's Certificate. The Company shall have furnished to the
Agents a certificate of the Company, signed by either the Chairman of the Board,
Chief Executive Officer, President, Chief Operating Officer, Chief Financial
Officer, Secretary, General Counsel or Treasurer of the Company, dated the date
of such certificate, to the effect that the signatory of such certificate has
carefully examined the Registration Statement, the Prospectus and amendments and
supplements thereto and this Agreement and that:
(i) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or, to the Company's knowledge, threatened;
(ii) since the date of the Prospectus there has occurred no event
required to be set forth in an amendment or supplement to the Registration
Statement or Prospectus, and there has been no document required to be
filed under the 1933 Act, the 1933 Act Regulations, the 1934 Act or the
1934 Act Regulations which, upon filing, would be deemed to be incorporated
by reference in the Prospectus which has not been so filed; and
14
(iii) nothing has come to the attention of the Company that would
cause it to believe that the priority status of the Funding Agreements
under Section 5/205 of the Illinois Insurance Code has been adversely
modified since the date of the last delivery of the opinion issued by Lord,
Bissell & Brook LLP, substantially in the form of Exhibit C attached to the
Distribution Agreement.
SECTION 5. Indemnification.
(a) Indemnification of the Agent. With respect to any series of Notes, the
Company agrees to indemnify and hold harmless each applicable Agent, its
directors and officers and each person, if any, who controls such Agent within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as
follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of an untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto) or the omission or alleged omission therefrom of
a material fact required to be stated therein or necessary to make the
statements therein not misleading, or arising out of an untrue statement or
alleged untrue statement of a material fact included in any preliminary
prospectus or the Time of Sale Prospectus or the Prospectus (or any
amendment or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any 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, provided that (subject to Section
5(d) hereof) any such settlement is effected with the written consent of
the Company; and
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by such Agent), reasonably
incurred in investigating, preparing or defending against any litigation,
or any 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, to
the extent that any such expense is not paid under subparagraph (i) or (ii)
above;
provided, however, that this indemnity does not apply to any loss, liability,
claim, damage or expense to the extent arising out of (i) an untrue statement or
omission or alleged untrue statement or omission made in reliance upon and in
conformity with written information furnished to the Company by the applicable
Agents concerning such Agents expressly for use in the Registration Statement
(or any amendment thereto) or any preliminary prospectus, the applicable Time of
Sale Prospectus or the Prospectus (or any amendment or supplement thereto), (ii)
any use of the Prospectus by the Agents to sell Notes or solicit offers for the
purchase of Notes (x) after such time as the Company shall have provided written
notice pursuant to Section 2(f) hereunder or
15
Global Funding shall have provided written notice pursuant to Section 4(f) under
the Distribution Agreement to the Agents to cease the sale of Notes and
solicitation of offers for the purchase of Notes and (y) before such time as the
Company shall have advised such Agent as the case may be, that such solicitation
may be resumed or (iii) a claim for indemnity made under the Distribution
Agreement, only to the extent such claim has previously been satisfied by the
Company pursuant to the terms of the Distribution Agreement.
(b) Indemnification of the Company. With respect to any series of Notes,
each Agent agrees, severally but not jointly, to indemnify and hold harmless the
Company, its directors, officers and trustees (if applicable) who signed the
Registration Statement and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act against
any and all loss, liability, claim, damage and expense described in the
indemnity contained in Section 5(a) hereof, as incurred, but only with respect
to untrue statements or omissions, or alleged untrue statements or omissions,
made in the Registration Statement (or any amendment thereto) or any preliminary
prospectus, the applicable Time of Sale Prospectus or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by such Agent concerning such Agent
expressly for use in the Registration Statement (or any amendment thereto) or
such preliminary prospectus, the applicable Time of Sale Prospectus or the
Prospectus (or any amendment or supplement thereto).
(c) Actions Against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable 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 such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 5(a) hereof or
Section 10(a) of the Distribution Agreement, counsel to the indemnified parties
shall be selected by the applicable Agent(s) and, in the case of parties
indemnified pursuant to Section 5(b) hereof or Section 10(b) of the Distribution
Agreement, counsel to the indemnified shall be selected by the Company and
Global Funding. An indemnifying party may participate at its own expense in the
defense of any such action; provided, however, that counsel to the indemnifying
party shall not (except with the consent of the indemnified party) also be
counsel to the indemnified party. In no event shall the indemnifying parties
(collectively with any other indemnifying parties in connection with the
Distribution Agreement), whether such indemnity is claimed hereunder or under
the Distribution Agreement, be liable for fees and expenses of more than one
counsel (in addition to any local counsel) separate from their own 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.
No indemnifying party under this Agreement or the Distribution Agreement,
shall, without the prior written consent of the indemnified parties under this
Agreement and the Distribution Agreement, settle or compromise or consent to the
entry of any judgment with respect to any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened, or any
claim whatsoever in respect of which indemnification or contribution could be
sought under this Section 5 or Section 6 hereof (whether or not the indemnified
parties are actual or potential parties thereto), unless such settlement,
compromise or
16
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested in writing an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 5(a)(ii) effected without its written consent if
(i) such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
have received notice of the terms of such settlement at least 30 days prior to
such settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request prior to
the date of such settlement.
SECTION 6. Contribution.
If the indemnification provided for in Section 5 hereof is for any reason
unavailable to or insufficient to hold harmless an indemnified party in respect
of any losses, liabilities, claims, damages or expenses referred to therein,
then each indemnifying party shall contribute to the aggregate amount of such
losses, liabilities, claims, damages and expenses incurred by such indemnified
party, as incurred, (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company, on one hand, and the applicable
Agent(s), on the other hand, from the offering of the Notes that were the
subject of the claim for indemnification or (ii) if the allocation provided by
clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company, on one hand, and the
applicable Agent(s), on the other hand, in connection with the statements or
omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company, on the one hand, and the
applicable Agent(s), on the other hand, in connection with the offering of the
Notes that were the subject of the claim for indemnification shall be deemed to
be in the same respective proportions as the total net proceeds from the
offering of such Notes (before deducting expenses) received by the Company and
the total discount or commission received by the applicable Agent(s), as the
case may be, bears to the aggregate initial offering price of such Notes.
The relative fault of the Company, on one hand, and the applicable
Agent(s), on the other hand, shall be determined by reference to, among other
things, whether any untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company, on one hand, or by the applicable Agent(s), on the
other hand, and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The parties agree that it would not be just and equitable if contribution
pursuant to this Section 6 were determined by pro rata allocation (even if the
Agents were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the
17
equitable considerations referred to above in this Section 6. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 6 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any applicable untrue or alleged
untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 6, (i) no Agent shall be
required to contribute any amount in excess of the amount by which the total
discount or commission received by such Agent in connection with the offering of
the Notes that were the subject of the claim for indemnification exceeds the
amount of any damages which such Agent has otherwise been required to pay by
reason of any applicable untrue or alleged untrue statement or omission or
alleged omission and (ii) no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. In addition, in connection with an offering of Notes
purchased from an Issuing Trust by two or more Agents as principal, the
respective obligations of such Agents to contribute pursuant to this Section 6
are several, and not joint, in proportion to the aggregate principal amount of
Notes that each such Agent has agreed to purchase from such Issuing Trust.
For purposes of this Section 6, each director, officer and person, if any,
who controls an Agent within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as such
Agent, and each director, officer and trustee (if applicable) of the Company,
and each person, if any, who controls the Company within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Company.
SECTION 7. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this Agreement,
in certificates submitted pursuant hereto shall remain operative and in full
force and effect, regardless of any investigation made by or on behalf of the
Agents or any controlling person of the Agents, or by or on behalf of the
Company, and shall survive each delivery of and payment for the Notes.
SECTION 8. Termination.
(a) Termination of this Agreement. This Agreement shall terminate as
follows:
(i) With respect to all Agents, automatically and simultaneously with
the termination of the Distribution Agreement with respect to all Agent(s)
(such termination shall be effective immediately);
(ii) With respect to all Agents, at any time at the option of the
Company, if the Distribution Agreement is amended or supplemented without
the Company's prior written consent (such termination shall be effective
immediately upon exercise of such option);
18
(iii) With respect to the applicable Agent(s), at any time at the
option of the Company, if any use of the Prospectus by the applicable
Agent(s) to sell Notes or solicit offers for the purchase of Notes occurs
(x) after such time as the Company shall have provided written notice
pursuant to Section 2(f) hereunder or Global Funding shall have provided
written notice pursuant to Section 4(f) of the Distribution Agreement to
the applicable Agent(s) to cease the sale of Notes and solicitation of
offers for the purchase of Notes and (y) before such time as the relevant
Issuing Trust shall have advised such Agent as the case may be, that such
solicitation may be resumed; or
(iv) With respect to the applicable Agent(s), at any time at the
option of the Company, if the applicable Agent(s) is added or deleted as a
party to this Agreement without the prior written consent of the Company
(such termination shall be effective immediately upon exercise of such
option).
(b) General. In the event of any such termination, neither party will have
any liability to the other party hereto, except that (i) the applicable Agent(s)
shall be entitled to any commissions earned in accordance with the Distribution
Agreement, (ii) if at the time of termination (a) any applicable Agent shall own
any Notes purchased by it from an Issuing Trust as principal or (b) an offer to
purchase any of the Notes has been accepted by an Issuing Trust but the time of
delivery to the purchaser or his agent of such Notes relating thereto has not
occurred, the covenants set forth in Sections 2 and 4 hereof shall remain in
effect until such Notes are so resold or delivered, as the case may be, and
(iii) the covenant set forth in Section 2(j) hereof, the indemnity and
contribution agreements set forth in Sections 5 and 6 hereof, and the provisions
of Sections 7, 10 and 11 hereof shall remain in effect.
SECTION 9. Notices.
Unless otherwise provided herein, all notices required under the terms and
provisions hereof shall be in writing, either delivered by hand, by mail or by
telex, telecopier or telegram, and any such notice shall be effective when
received at the address specified below.
If to the Company:
Allstate Life Insurance Company
3100 Sanders Road, Suite M3A
Northbrook, Illinois 60062
Attention: Assistant Vice President, Institutional Markets
Telecopy No.: (847) 402-5000
If to the Agents:
To each Agent at the address specified in Schedule 1 to the
Distribution Agreement.
or at such other address as such party may designate from time to time by notice
duly given in accordance with the terms of this Section 9.
19
SECTION 10. Parties.
This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective successors. Nothing expressed or mentioned
in this Agreement is intended or shall be construed to give any person, firm or
corporation, other than the parties hereto and their respective successors and
the controlling persons, officers and directors referred to in Sections 5 and 6
hereof and their heirs and legal representatives, any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision herein
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the parties hereto and their
respective successors, and said controlling persons, officers and directors and
their heirs and legal representatives, and for the benefit of no other person,
firm or corporation. No purchaser of Notes shall be deemed to be a successor by
reason merely of such purchase.
SECTION 11. GOVERNING LAW; FORUM.
PURSUANT TO SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF
NEW YORK, THIS AGREEMENT AND ALL THE RIGHTS AND OBLIGATIONS OF THE PARTIES SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES. ANY SUIT, ACTION OR
PROCEEDING BROUGHT BY THE COMPANY AGAINST ANY AGENT IN CONNECTION WITH OR
ARISING UNDER THIS AGREEMENT SHALL BE BROUGHT SOLELY IN THE STATE OR FEDERAL
COURT OF APPROPRIATE JURISDICTION LOCATED IN THE BOROUGH OF MANHATTAN, THE CITY
OF NEW YORK.
SECTION 12. Effect of Headings.
The Article and Section headings herein are for convenience only and shall
not affect the construction hereof.
SECTION 13. Counterparts.
This Agreement may be executed in one or more counterparts and, if executed
in more than one counterpart, the executed counterparts hereof shall constitute
a single instrument.
SECTION 14. Amendments.
This Agreement may be amended or supplemented if, but only if, such
amendment or supplement is in writing and is signed by the Company and the
Agents. In accordance with the Distribution Agreement, Global Funding may from
time to time nominate any institution as a new Agent under the Distribution
Agreement either in respect of the Programs generally or in relation only to the
Notes of a particular Issuing Trust, and upon such nomination, if not already
executed, such Agent(s) will execute a counterpart of this Agreement.
20
SECTION 15. Separate Nature of Each Issuing Trust.
The Agents agree and acknowledge that, as a separate and distinct special
purpose statutory trusts, the debts, liabilities, obligations and expenses
incurred, contracted for or otherwise existing with respect to a particular
Issuing Trust, including such Issuing Trust's obligations under this Agreement
and the applicable Terms Agreement, will be enforceable only against such
Issuing Trust and not against any other Issuing Trust.
SECTION 16. Covenants of the Agents. Each Agent covenants with the Company:
(a) Delivery of Free Writing Prospectuses and Other Marketing Materials.
Except as otherwise provided in the applicable Terms Agreement, such Agent will,
prior to its first use, furnish the Company with a copy of each proposed free
writing prospectus that is required to be filed pursuant to Rule 433(d) under
the 1933 Act Regulations or is or will be part of the Time of Sale Prospectus
and any other marketing materials (other than (x) any free writing prospectus
that is not required to be filed or will not be part of the Time of Sale
Prospectus or (y) any marketing material that complies with Rule 134 of the 1933
Act Regulations) relating to or to be used in connection with any offer or sale
of the Notes, in each case prepared by or on behalf of such Agents and will not
use any such free writing prospectus or other marketing materials to which the
Company reasonably objects.
(b) Use of Free Writing Prospectuses and Other Marketing Materials. Such
Agent may use a free writing prospectus or any other marketing materials
prepared by or on behalf of such Agent only if such free writing prospectus or
such marketing materials complies in all material respects with the requirements
of the 1933 Act and the 1933 Act Regulations.
(c) Distribution of Free Writing Prospectuses and Other Marketing
Materials. Such Agent will not distribute any free writing prospectus or any
other marketing materials (other than any marketing material that complies with
Rule 134 of the 1933 Act Regulations) used or referred to by such Agent in a
manner reasonably designed to lead to its broad unrestricted dissemination;
provided that this covenant shall not apply to any free writing prospectus or
such marketing materials forming part of the Time of Sale Prospectus or any free
writing prospectus or such marketing materials prepared or approved by the
Company for broad unrestricted dissemination.
*** SIGNATURE PAGES FOLLOW ***
21
If the foregoing is in accordance with the Agents' understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this Agreement, along with all counterparts, will become a binding agreement by
and between the Agents and the Company in accordance with its terms.
Very truly yours,
ALLSTATE LIFE INSURANCE COMPANY
By:
------------------------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By:
-----------------------------------------------------
Authorized Signatory
A.G. EDWARDS & SONS, INC.
By:
-----------------------------------------------------
Authorized Signatory
BANC OF AMERICA SECURITIES LLC
By:
-----------------------------------------------------
Authorized Signatory
Signature Page to Representations and Indemnity Agreement, Part 1 of 4*
BARCLAYS CAPITAL INC.
By:
--------------------------------------------
Authorized Signatory
BEAR, STEARNS & CO. INC.
By:
--------------------------------------------
Authorized Signatory
CITIGROUP GLOBAL MARKETS INC.
By:
--------------------------------------------
Authorized Signatory
CREDIT SUISSE SECURITIES (USA) LLC
By:
--------------------------------------------
Authorized Signatory
DEUTSCHE BANK SECURITIES INC.
By:
--------------------------------------------
Authorized Signatory
By:
--------------------------------------------
Authorized Signatory
- ----------------------------------------------
GOLDMAN, SACHS & CO.
Signature Page to Representations and Indemnity Agreement, Part 2 of 4*
GREENWICH CAPITAL MARKETS, INC.
By:
--------------------------------------------
Authorized Signatory
J.P. MORGAN SECURITIES INC.
By:
--------------------------------------------
Authorized Signatory
LEHMAN BROTHERS INC.
By:
--------------------------------------------
Authorized Signatory
MORGAN STANLEY & CO. INCORPORATED
By:
--------------------------------------------
Authorized Signatory
UBS SECURITIES LLC
By:
--------------------------------------------
Authorized Signatory
By:
--------------------------------------------
Authorized Signatory
Signature Page to Representations and Indemnity Agreement, Part 3 of 4*
WACHOVIA CAPITAL MARKETS, LLC
By:
--------------------------------------------
Authorized Signatory
Signature Page to Representations and Indemnity Agreement, Part 4 of 4*
Exhibit 23.1 CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM We consent to the incorporation by reference in this Amendment No. 2 to Registration Statement No. 333-129157 of Allstate Life Global Funding and Allstate Life Insurance Company on Form S-3 of our report dated February 24, 2005 (which report expresses an unqualified opinion and includes an explanatory paragraph relating to a change in method of accounting for certain nontraditional long-duration contracts and for separate accounts in 2004 and changes in the methods of accounting for embedded derivatives in modified coinsurance agreements and variable interest entities in 2003), relating to the consolidated financial statements and financial statement schedules of Allstate Life Insurance Company, appearing in the Annual Report on Form 10-K of Allstate Life Insurance Company for the year ended December 31, 2004, and to the reference to us under the heading "Experts" in the Prospectus, which is part of this Registration Statement. /s/ Deloitte & Touche LLP Chicago, Illinois February 24, 2006
EXHIBIT 23.3
CONSENT OF LEBOEUF, LAMB, GREENE & MACRAE LLP
We hereby consent to the filing of our opinion letters as Exhibits 5.2
and 8 to the Registration Statement on Form S-3 (Registration File No.
333-129157) filed by Allstate Life Global Funding and Allstate Life Insurance
Company and to the use of our name under the headings "Risk Factors--Risk
Factors Relating to the Notes--The notes could be deemed to be participations in
the funding agreements or could otherwise be deemed to be contracts of insurance
and holders of the notes could be found to be acting as insurance agents or
brokers" and "Certain United States Federal Income Tax Considerations" in the
prospectus supplement relating to the Secured Medium Term Notes Program and in
the prospectus supplement relating to the Allstate Life(R) CoreNotes(R) program
and "LegaL Opinions" in the prospectus relating to the secured medium term notes
(the "Notes") and to the incorporation by reference of our opinions and consent
as exhibits to any registration statement filed in accordance with Rule 462(b)
under the Securities Act of 1933, as amended (the "Act"), relating to the Notes.
In giving this consent, we do not thereby concede that we are within the
category of persons whose consent is required under Section 7 of the Act or the
rules and regulations of the Securities and Exchange Commission thereunder.
LEBOEUF, LAMB, GREENE & MACRAE LLP
/s/ LEBOEUF, LAMB, GREENE & MACRAE LLP
February 27, 2006
EXHIBIT 23.4
CONSENT OF LORD, BISSELL & BROOK LLP
We hereby consent to the references to us contained in the prospectus,
which forms a part of the Registration Statement on Form S-3 filed by Allstate
Life Global Funding and Form S-3 filed by Allstate Life Insurance Company dated
February 27, 2006, Registration File No. 333-129157, relating to the proposed
issuance of secured medium term notes by the Delaware statutory trusts (the
"Registration Statement"), under the headings "Description of the Funding
Agreements" and "Legal Opinions". In addition, we hereby consent to the
references to us contained in the prospectus supplements, which form a part of
the Registration Statement, under the heading "Risk Factors". In giving this
consent, we do not admit that we are within the category of persons whose
consent is required under Section 7 of, nor do we thereby admit that we are
experts with respect to any part of the Registration Statement within the
meaning of the term "experts" as used in, the Securities Act of 1933, as
amended, or the rules and regulations issued by the Securities and Exchange
Commission thereunder.
LORD, BISSELL & BROOK LLP
/s/ Lord, Bissell & Brook LLP
Chicago, Illinois
February 27, 2006
EXHIBIT 23.5
CONSENT OF RICHARDS, LAYTON & FINGER, P.A.
We hereby consent to the reference to us contained in the prospectus, which
forms a part of the Registration Statement on Form S-3 filed by Allstate Life
Global Funding and Form S-3 filed by Allstate Life Insurance Company dated
February 27, 2006, Registration File No. 333-129157, relating to the proposed
issuance of secured medium term notes by the Delaware statutory trusts (the
"Registration Statement"), under the heading "Legal Opinions". In giving this
consent, we do not admit that we are within the category of persons whose
consent is required under Section 7 of, nor do we thereby admit that we are
experts with respect to any part of the Registration Statement within the
meaning of the term "experts" as used in, the Securities Act of 1933, as
amended, or the rules and regulations issued by the Securities and Exchange
Commission thereunder.
RICHARDS, LAYTON & FINGER, P.A.
/s/ Richards, Layton & Finger, P.A.
Wilmington, Delaware
February 27, 2006
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
----------------------------------------
J. P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION
(Exact name of trustee as
specified in its charter)
95-4655078
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
1999 Avenue of the Stars - Floor 26
Los Angeles, CA 90067
(Address of principal executive offices) (Zip Code)
Robert M. Macallister
Vice President and Assistant General Counsel
J. P. Morgan Trust Company, National Association
c/o 1 Chase
Manhattan Plaza, 25th Floor
New York, New York 10081
Tel: (212) 552-1716
(Name, address and telephone number of agent for service)
--------------------------------------------
ALLSTATE LIFE GLOBAL FUNDING
(Exact name of obligor as specified in its charter)
Delaware Not Applicable
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
6525 Morrison Boulevard, Suite 318
Charlotte, North Carolina 28211
(Address of principal executive offices) (Zip Code)
Secured Notes
(Title of the indenture securities)
-------------------------------------------------------------
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
Comptroller of the Currency, Washington, D.C.
Board of Governors of the Federal Reserve System, Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with Obligor.
If the Obligor is an affiliate of the trustee, describe each such
affiliation.
None.
No responses are included for Items 3-15 of this Form T-1 because the Obligor is
not in default as provided under Item 13.
Item 16. List of Exhibits.
List below all exhibits filed as part of this statement of eligibility.
Exhibit 1. Articles of Association of the Trustee as Now in Effect
(see Exhibit 1 to Form T-1 filed in connection with Form 8K
of the Southern California Water Company filing, dated
December 7, 2001, which is incorporated by reference).
Exhibit 2. Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection
with Registration Statement No. 333-41329, which is
incorporated by reference).
Exhibit 3. Authorization of the Trustee to Exercise Corporate Trust
Powers (contained in Exhibit 2).
Exhibit 4. Existing By-Laws of the Trustee (see Exhibit 4 to Form
T-1 filed in connection with Form 8K of the Southern
California Water Company filing, dated December 7, 2001,
which is incorporated by reference).
Exhibit 5. Not Applicable
Exhibit 6. The consent of the Trustee required by Section 321 (b)
of the Act (see Exhibit 6 to Form T-1 filed in connection
with Registration Statement No. 333-41329, which is
incorporated by reference).
Exhibit 7. A copy of the latest report of condition of the Trustee,
published pursuant to law or the requirements of its
supervising or examining authority.
Exhibit 8. Not Applicable
Exhibit 9. Not Applicable
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
Trustee, J. P. Morgan Trust Company, National Association, has duly caused this
statement of eligibility and qualification to be signed on its behalf by the
undersigned, thereunto duly authorized, all in the City of Los Angeles, and
State of California, on the 27th day of February, 2006.
J. P. Morgan Trust Company, National Association
By /s/ Janice Ott Rotunno
----------------------
Janice Ott Rotunno
Vice President
Exhibit 7. Report of Condition of the Trustee.
- -------------------------------------------------------------------------------
Consolidated Report of Condition of J.P. Morgan Trust Company, N.A., (formerly
Chase Manhattan Bank and Trust Company, N.A.)
- -------------------------------------------------------------------------------
(Legal Title)
Located at 1999 Avenue of the Stars - Floor 26 Los Angeles, CA 90067
--------------------------------------------------------------------
(Street) (City) (State) (Zip)
as of close of business on September 30, 2005
-----------------------------------
ASSETS DOLLAR AMOUNTS IN THOUSANDS
1. Cash and balances due from depository institutions (from Schedule RC-A):
a. Noninterest-bearing balances and currency and coin (1) 1,516
b. Interest bearing balances (2) 0
2. Securities:
a. Held-to-maturity securities (from Schedule RC-B, column A) 0
b. Available-for-sale securities (from Schedule RC-B, column D) 687
3. Federal Funds sold and securities purchased agreements to resell 55,250
4. Loans and lease financing receivables (from Schedule RC-C):
a. Loans and leases held for sale 0
b. Loans and leases, net of unearned income 1,440
c. LESS: Allowance for loan and lease losses 0
d. Loans and leases, net of unearned income and
allowance (item 4.b minus 4.c) 1,440
5. Trading assets (from Schedule RC-D) N/A
6. Premises and fixed assets (including capitalized leases) 182
7. Other real estate owned (from Schedule RC-M) 0
8. Investments in unconsolidated subsidiaries and associated companies
(from Schedule RC-M) 0
9. Customers' liability to this bank on acceptances outstanding 0
10. Intangible assets
a. Goodwill 20
b. Other intangible assets (from Schedule RC-M) 383
11. Other assets (from Schedule RC-F) 3,060
12. TOTAL ASSETS (sum of items 1 through 11) 62,538
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C from
Schedule RC-E) 25,467
(1) Noninterest-bearing (1) 6,583
(2) Interest-bearing 18,885
b. In foreign offices, Edge and Agreement subsidiaries, and IBF'
(1) Noninterest-bearing N/A
(2) Interest-bearing N/A
14. Federal funds purchased and securities sold under agreements to repurchase 0
15. Trading liabilities (from Schedule RC-D) 0
16. Other borrowed money (includes mortgage indebtedness and obligations
under capitalized leases) (from Schedule RC-M): 0
17. Not applicable
18. Bank's liability on acceptances executed and outstanding 0
19. Subordinated notes and debentures (2) 0
20. Other liabilities (from Schedule RC-G) 8,355
21. Total liabilities (sum of items 13 through 20) 33,822
22. Minority interest in consolidated subsidiaries 0
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus 0
24. Common stock 600
25. Surplus (exclude all surplus related to preferred stock) 13,169
26. a. Retained earnings 14,946
b. Accumulated other comprehensive income (3) 1
27. Other equity capital components (4) 0
28. Total equity capital (sum of items 23 through 27) 28,716
29. Total liabilities, minority interest, and equity capital
(sum of items 21, 22, and 28) 62,538
Memorandum
To be reported with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below
that best describes the most comprehensive level of auditing work
performed for the bank by independent external auditors as of any date
during 2000 1
- -------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
(3) Includes net unrealized holding gains (losses) on available-for-sale
securities, accumulated net gains (losses) on cash flow hedges, and minimum
pension liability adjustments.
(4) Includes treasury stock and unearned Employee Stock Ownership Plan shares.
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
-------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF
A CORPORATION DESIGNATED TO ACT AS TRUSTEE
-------------------------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF
A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________
----------------------------------------
J. P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION
(Exact name of trustee as
specified in its charter)
95-4655078
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
1999 Avenue of the Stars - Floor 26
Los Angeles, CA 90067
(Address of principal executive offices) (Zip Code)
Robert M. Macallister
Vice President and Assistant General Counsel
J. P. Morgan Trust Company, National Association
c/o 1 Chase
Manhattan Plaza, 25th Floor
New York, New York 10081
Tel: (212) 552-1716
(Name, address and telephone number of agent for service)
--------------------------------------------
ALLSTATE LIFE GLOBAL FUNDING
(Exact name of obligor as specified in its charter)
Delaware Not Applicable
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
6525 Morrison Boulevard, Suite 318
Charlotte, North Carolina 28211
(Address of principal executive offices) (Zip Code)
Funding Notes
(Title of the indenture securities)
-------------------------------------------------------------
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
Comptroller of the Currency, Washington, D.C.
Board of Governors of the Federal Reserve System, Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with Obligor.
If the Obligor is an affiliate of the trustee, describe each such
affiliation.
None.
No responses are included for Items 3-15 of this Form T-1 because the Obligor is
not in default as provided under Item 13.
Item 16. List of Exhibits.
List below all exhibits filed as part of this statement of eligibility.
Exhibit 1. Articles of Association of the Trustee as Now in Effect
(see Exhibit 1 to Form T-1 filed in connection with Form 8K
of the Southern California Water Company filing, dated
December 7, 2001, which is incorporated by reference).
Exhibit 2. Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection
with Registration Statement No. 333-41329, which is
incorporated by reference).
Exhibit 3. Authorization of the Trustee to Exercise Corporate Trust
Powers (contained in Exhibit 2).
Exhibit 4. Existing By-Laws of the Trustee (see Exhibit 4 to Form
T-1 filed in connection with Form 8K of the Southern
California Water Company filing, dated December 7, 2001,
which is incorporated by reference).
Exhibit 5. Not Applicable
Exhibit 6. The consent of the Trustee required by Section 321 (b)
of the Act (see Exhibit 6 to Form T-1 filed in connection
with Registration Statement No. 333-41329, which is
incorporated by reference).
Exhibit 7. A copy of the latest report of condition of the Trustee,
published pursuant to law or the requirements of its
supervising or examining authority.
Exhibit 8. Not Applicable
Exhibit 9. Not Applicable
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
Trustee, J. P. Morgan Trust Company, National Association, has duly caused this
statement of eligibility and qualification to be signed on its behalf by the
undersigned, thereunto duly authorized, all in the City of Los Angeles, and
State of California, on the 27th day of February, 2006.
J. P. Morgan Trust Company, National Association
By /s/ Janice Ott Rotunno
-----------------------
Janice Ott Rotunno
Vice President
Exhibit 7. Report of Condition of the Trustee.
- -------------------------------------------------------------------------------
Consolidated Report of Condition of J.P. Morgan Trust Company, N.A., (formerly
Chase Manhattan Bank and Trust Company, N.A.)
- -------------------------------------------------------------------------------
(Legal Title)
Located at 1999 Avenue of the Stars - Floor 26 Los Angeles, CA 90067
--------------------------------------------------------------------
(Street) (City) (State) (Zip)
as of close of business on September 30, 2005
-----------------------------------
ASSETS DOLLAR AMOUNTS IN THOUSANDS
1. Cash and balances due from depository institutions (from Schedule RC-A):
a. Noninterest-bearing balances and currency and coin (1) 1,516
b. Interest bearing balances (2) 0
2. Securities:
a. Held-to-maturity securities (from Schedule RC-B, column A) 0
b. Available-for-sale securities (from Schedule RC-B, column D) 687
3. Federal Funds sold and securities purchased agreements to resell 55,250
4. Loans and lease financing receivables (from Schedule RC-C):
a. Loans and leases held for sale 0
b. Loans and leases, net of unearned income 1,440
c. LESS: Allowance for loan and lease losses 0
d. Loans and leases, net of unearned income and
allowance (item 4.b minus 4.c) 1,440
5. Trading assets (from Schedule RC-D) N/A
6. Premises and fixed assets (including capitalized leases) 182
7. Other real estate owned (from Schedule RC-M) 0
8. Investments in unconsolidated subsidiaries and associated companies
(from Schedule RC-M) 0
9. Customers' liability to this bank on acceptances outstanding 0
10. Intangible assets
a. Goodwill 20
b. Other intangible assets (from Schedule RC-M) 383
11. Other assets (from Schedule RC-F) 3,060
12. TOTAL ASSETS (sum of items 1 through 11) 62,538
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C from
Schedule RC-E) 25,467
(1) Noninterest-bearing (1) 6,583
(2) Interest-bearing 18,885
b. In foreign offices, Edge and Agreement subsidiaries, and IBF'
(1) Noninterest-bearing N/A
(2) Interest-bearing N/A
14. Federal funds purchased and securities sold under agreements to repurchase 0
15. Trading liabilities (from Schedule RC-D) 0
16. Other borrowed money (includes mortgage indebtedness and obligations
under capitalized leases) (from Schedule RC-M): 0
17. Not applicable
18. Bank's liability on acceptances executed and outstanding 0
19. Subordinated notes and debentures (2) 0
20. Other liabilities (from Schedule RC-G) 8,355
21. Total liabilities (sum of items 13 through 20) 33,822
22. Minority interest in consolidated subsidiaries 0
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus 0
24. Common stock 600
25. Surplus (exclude all surplus related to preferred stock) 13,169
26. a. Retained earnings 14,946
b. Accumulated other comprehensive income (3) 1
27. Other equity capital components (4) 0
28. Total equity capital (sum of items 23 through 27) 28,716
29. Total liabilities, minority interest, and equity capital
(sum of items 21, 22, and 28) 62,538
Memorandum
To be reported with the March Report of Condition.
1. Indicate in the box at the right the number of the statement
below that best describes the most comprehensive level of
auditing work performed for the bank by independent external
auditors as of any date during 2000 1
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
(3) Includes net unrealized holding gains (losses) on available-for-sale
securities, accumulated net gains (losses) on cash flow hedges, and minimum
pension liability adjustments.
(4) Includes treasury stock and unearned Employee Stock Ownership Plan shares.
EXHIBIT 3.4
AMENDED AND RESTATED CERTIFICATE OF TRUST OF
ALLSTATE LIFE GLOBAL FUNDING
This AMENDED AND RESTATED CERTIFICATE OF TRUST, dated as of April 20,
2004 of Allstate Life Global Funding (the "Amended and Restated Certificate of
Trust") amends and restates in its entirety the Certificate of Trust of Allstate
Life Global Funding, dated as of June 24, 2002.
1. Name. The name of the statutory trust is Allstate Life Global Funding (the
"Trust").
2. Delaware Trustee. The name and business address of the trustee of the Trust
with its principal place of business in the State of Delaware is Wilmington
Trust Company, Rodney Square North, 1100 North Market Street, Wilmington,
Delaware, 19890-0001, Attention: Corporate Trust Administration.
3. Effective Time. This Amended and Restated Certificate of Trust will be
effective upon its filing with the Secretary of State of the State of Delaware.
IN WITNESS WHEREOF, the undersigned, being the Delaware Trustee of the
Trust as of the date of filing of this Amended and Restated Certificate of
Trust, has executed this Amended and Restated Certificate of Trust as of the
date first above written in accordance with Section 3811(a) of the Delaware
Statutory Trust Act (12 Del. Code, Section 3801 et seq.).
WILMINGTON TRUST COMPANY, not in its individual
capacity but solely as Delaware Trustee
By: /s/ CHARISSE L. RODGERS
--------------------------
Name: Charisse L. Rodgers
Title: Vice President
EXHIBIT 3.5
CERTIFICATE OF TRUST OF
ALLSTATE LIFE GLOBAL FUNDING TRUST [ ]-[ ]
This CERTIFICATE OF TRUST of Allstate Life Global Funding Trust [ ]-[ ]
(the "Trust"), is being duly executed and filed by the undersigned trustees to
form a statutory trust under the Delaware Statutory Trust Act (12 Del. Code,
Section 3801 et seq.) (the "Act").
1. Name. The name of the statutory trust formed hereby is Allstate Life
Global Funding Trust [ ]-[ ].
2. Delaware Trustee. The name and business address of the trustee of the
Trust with its principal place of business in the State of Delaware is
Wilmington Trust Company, Rodney Square North, 1100 North Market Street,
Wilmington, Delaware, 19890-0001, Attention: Corporate Trust Administration.
3. Effective Time. This Certificate of Trust will be effective upon its
filing with the Secretary of State of the State of Delaware.
IN WITNESS WHEREOF, the undersigned, being all of the trustees of the Trust
as of the date of filing of this Certificate of Trust, have executed this
Certificate of Trust in accordance with Section 3811(a)(1) of the Act.
WILMINGTON TRUST COMPANY,
not in its individual capacity,
but solely as Delaware Trustee
By:
------------------------------
Name:
Title:
EXHIBIT 4.1
===============================================================================
FORM OF AMENDED AND RESTATED TRUST AGREEMENT
of
ALLSTATE LIFE GLOBAL FUNDING
among
WILMINGTON TRUST COMPANY,
as Delaware Trustee,
AMACAR PACIFIC CORP.,
as Administrator,
and
AMACAR PACIFIC CORP.,
as Trust Beneficial Owner
Dated -, 2006
===============================================================================
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS.....................................................................................1
SECTION 1.1 Definitions..............................................................................1
SECTION 1.2 Other Definitional Provisions............................................................7
ARTICLE 2 CONTINUATION OF GLOBAL FUNDING..................................................................7
SECTION 2.1 Name; Amendment and Restatement of the Base Trust Agreement..............................7
SECTION 2.2 Office of the Delaware Trustee; Principal Place of Business..............................8
SECTION 2.3 Statutory Trust..........................................................................8
SECTION 2.4 Trust Beneficial Owner...................................................................8
SECTION 2.5 Purposes of Global Funding...............................................................8
SECTION 2.6 Allocation of Trust Expenses.............................................................9
SECTION 2.7 Liability................................................................................9
SECTION 2.8 Income Tax Treatment.....................................................................9
SECTION 2.9 Situs of Global Funding.................................................................10
ARTICLE 3 PAYMENT ACCOUNTS...............................................................................10
SECTION 3.1 Payment Accounts........................................................................10
ARTICLE 4 FUNDING NOTES..................................................................................11
SECTION 4.1 Issuance of Funding Notes...............................................................11
SECTION 4.2 Acquisition of Funding Agreement(s); Redemption and Satisfaction
of Funding Notes........................................................................11
ARTICLE 5 REPRESENTATIONS AND WARRANTIES BY THE DELAWARE TRUSTEE.........................................12
ARTICLE 6 DELAWARE TRUSTEE...............................................................................13
SECTION 6.1 General Authority.......................................................................13
SECTION 6.2 General Duties..........................................................................19
SECTION 6.3 Specific Duties.........................................................................19
SECTION 6.4 Acceptance of Trust and Duties; Limitation on Liability.................................19
SECTION 6.5 Reliance; Advice of Counsel.............................................................23
SECTION 6.6 Delegation of Authorities and Duties....................................................24
ARTICLE 7 TERMINATION OF AGREEMENT; DISSOLUTION OF GLOBAL FUNDING........................................24
SECTION 7.1 Termination of Agreement................................................................24
ARTICLE 8 SUCCESSOR AND ADDITIONAL DELAWARE TRUSTEES.....................................................26
SECTION 8.1 Eligibility Requirements for the Delaware Trustee.......................................26
SECTION 8.2 Resignation or Removal of the Delaware Trustee..........................................26
SECTION 8.3 Successor Delaware Trustee..............................................................27
SECTION 8.4 Merger or Consolidation of Delaware Trustee.............................................28
ARTICLE 9 MISCELLANEOUS PROVISIONS.......................................................................28
SECTION 9.1 Limitation on Rights of Others..........................................................28
i
SECTION 9.2 Amendments..............................................................................28
SECTION 9.3 Notices.................................................................................30
SECTION 9.4 No Recourse.............................................................................31
SECTION 9.5 Limited Recourse........................................................................31
SECTION 9.6 No Petition.............................................................................31
SECTION 9.7 Governing Law...........................................................................32
SECTION 9.8 Severability............................................................................32
SECTION 9.9 Third Party Beneficiaries...............................................................32
SECTION 9.10 Counterparts............................................................................32
ii
This Amended and Restated Trust Agreement (this "Amended and Restated Trust
Agreement") dated and effective as of -, 2006, is entered into among the
undersigned Delaware Trustee (as defined below), the Administrator (as defined
below) and the Trust Beneficial Owner (as defined below):
WHEREAS, the Delaware Trustee and the Trust Beneficial Owner have entered
into that certain Trust Agreement, dated as of June 24, 2002, as amended and
restated by the Amended and Restated Trust Agreement dated as of April 27, 2004,
and as further amended and restated by the Amended and Restated Trust Agreement
dated as of August 16, 2005 (as so amended and restated, the "Base Trust
Agreement"), and the parties hereto desire to amend and restate the Base Trust
Agreement in its entirety;
WHEREAS, since August 27, 2004, Global Funding has been facilitating, and
the parties desire that Global Funding continue to facilitate, a program (the
"Program") for the issuance, from time to time, of Secured Medium Term Notes and
Allstate Life(R) CoreNotes(R) (collectively, the "Notes"), as more fully
described in the Registration Statement; and
WHEREAS, the Notes outstanding under the Program have been, and any Notes
to be issued under the Program will be, issued by a newly created Delaware
statutory trust (each, a "Trust");
NOW, THEREFORE, in consideration of the premises and the covenants set
forth in this Amended and Restated Trust Agreement, the parties agree as
follows:
ARTICLE 1
DEFINITIONS
SECTION 1.1 Definitions. The following terms have the meanings set forth
below:
"Administrator" means AMACAR Pacific Corp., a Delaware corporation in its
capacity as the sole administrator of Global Funding, and its successors and
assigns.
"Affiliate" means, as applied to any Person, any other Person directly or
indirectly controlling, controlled by or under common control with, that Person
and, in the case of an individual, any spouse or other member of that
individual's immediate family. For the purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of that Person, whether through the
ownership of voting securities, by contract or otherwise.
"Agents" has the meaning set forth in the Distribution Agreement.
1
"Allstate Life" means Allstate Life Insurance Company, a stock insurance
company organized and licensed under the laws of the State of Illinois, and any
successor.
"Amended and Restated Administrative Services Agreement" means that certain
Amended and Restated Administrative Services Agreement dated as of -, 2006,
between the Administrator and Global Funding, as the same may be amended,
supplemented, modified, restated or replaced from time to time.
"Amended and Restated Certificate of Trust" means the Amended and Restated
Certificate of Trust of Global Funding as filed with the Secretary of State on
- -, 2006.
"Amended and Restated Name Licensing Agreement" means that certain Amended
and Restated Name Licensing Agreement dated as of -, 2006, between Allstate
Insurance Company and Global Funding, as the same may be amended, supplemented,
modified, restated or replaced from time to time.
"Amended and Restated Support Agreement" means that certain Amended and
Restated Support and Expenses Agreement dated as of -, 2006, between Allstate
Life and Global Funding, as the same may be amended, supplemented, modified,
restated or replaced from time to time.
"Business Day" means any day, other than a Saturday or Sunday, that is
neither a legal holiday nor a day on which commercial banks are authorized or
required by law, regulation or executive order to close in The City of New York.
"Closing Instrument" means, with respect to any Trust, the Closing
Instrument of the Trust, pursuant to which certain documents are executed in
connection with the issuance of the Notes by the Trust.
"Code" means the Internal Revenue Code of 1986, as amended, including any
successor or amendatory statutes and any applicable rules, regulations, notices
or orders promulgated thereunder.
"Collateral", with respect to any Funding Note, has the meaning ascribed in
the applicable Funding Note Indenture.
"Commission" means the Securities and Exchange Commission or any successor
body.
"Corporate Trust Office" means the principal office of the Delaware Trustee
located at Rodney Square North, 1100 North Market Street, Wilmington, Delaware
19890-0001.
2
"Debt" of any Person means, at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of
business, all obligations of such Person as lessee which are capitalized in
accordance with generally accepted accounting principles, (iv) all contingent
and non-contingent obligations of such Person to reimburse any bank or other
Person in respect of amounts paid under a letter of credit or similar
instrument, (v) all Debt secured by a Lien on any asset of such Person, whether
or not such Debt is otherwise an obligation of such Person, and (vi) all
Guarantees by such Person of Debt of another Person (each such Guarantee to
constitute Debt in an amount equal to the amount of such other Person's Debt
Guaranteed thereby).
"Delaware Statutory Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. Section 3801, et seq., as amended from time to time.
"Delaware Trustee" means Wilmington Trust Company, a Delaware banking
corporation, in its capacity as the sole Delaware trustee of the Trust, and its
successors. If there shall be at any time more than one Delaware Trustee under
this Amended and Restated Trust Agreement, "Delaware Trustee" shall mean each
such Delaware Trustee.
"Distribution Agreement" means that certain Distribution Agreement dated as
of -, 2006, by and among the Trust and the Agents named therein, as the same may
be amended, supplemented, modified, restated or replaced from time to time.
"Exchange Act" means the Securities Exchange Act of 1934, as it may be
amended or supplemented from time to time, and any successor statute thereto,
and the rules, regulations and published interpretations of the Commission
promulgated thereunder from time to time.
"Funding Agreement" means, with respect to any Trust, each funding
agreement issued by Allstate Life to Global Funding, which is immediately
pledged and collaterally assigned by Global Funding to the Funding Note
Indenture Trustee and immediately thereafter assigned absolutely to, and
deposited into, the relevant Trust by Global Funding, as the same may be
amended, supplemented, modified, restated or replaced from time to time in
accordance with the terms thereof.
"Funding Agreement Event of Default" means, with respect to any Funding
Agreement, an "Event of Default" as defined in the Funding Agreement.
"Funding Note", with respect to any Trust, has the meaning ascribed in the
applicable Funding Note Indenture.
"Funding Note Certificate", with respect to any Funding Note, has the
meaning ascribed in the applicable Funding Note Indenture.
3
"Funding Note Indenture" means, with respect to any Funding Note sold by
Global Funding to a Trust, the Funding Note Indenture included in Part H of the
applicable Series Instrument, among Global Funding and the other parties
specified therein, as the same may be amended, supplemented, modified, restated
or replaced from time to time.
"Funding Note Indenture Trustee", with respect to any Trust, has the
meaning ascribed in the applicable Funding Note Indenture.
"Global Funding" means Allstate Life Global Funding, a statutory trust
organized under the laws of the State of Delaware.
"Guarantee" by any Person means any obligation, contingent or otherwise, of
such Person directly or indirectly guaranteeing any Debt of any other Person
and, without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Debt (whether
arising by virtue of partnership arrangements, by virtue of an agreement to
keep-well, to purchase assets, goods, securities or services, to take-or-pay, or
to maintain financial statement conditions or otherwise), (ii) to reimburse a
bank for amounts drawn under a letter of credit for the purpose of paying such
Debt or (iii) entered into for the purpose of assuring in any other manner the
holder of such Debt of the payment thereof or to protect such holder against
loss in respect thereof (in whole or in part); provided that the term
"Guarantee" shall not include endorsements for collection or deposit in the
ordinary course of business.
"Holder", with respect to any Funding Note, has the meaning ascribed in the
applicable Funding Note Indenture.
"Indenture" means, with respect to any Trust, the Indenture included in
Part G of the applicable Series Instrument, among the Trust and the other
parties specified therein, as the same may be amended, supplemented, modified,
restated or replaced from time to time.
"Indenture Trustee", with respect to any Trust, has the meaning ascribed in
the applicable Indenture.
"Investment Company Act" means the Investment Company Act of 1940, as
amended, as it may be amended or supplemented from time to time, and any
successor statute thereto, and the rules, regulations and published
interpretations of the Commission promulgated thereunder from time to time.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), or preference, priority or
other security agreement or preferential arrangement of any kind or nature
whatsoever
4
(including without limitation any conditional sale or other title
retention agreement, any financing lease having substantially the same economic
effect as any of the foregoing, and the filing of any financing statement under
the UCC or comparable law of any jurisdiction).
"Moody's" means Moody's Investors Service, Inc.
"Notes" has the meaning ascribed in the second recital.
"Payment Account" means, with respect to any Funding Note, the segregated
non-interest-bearing corporate trust account for Global Funding maintained by
the Delaware Trustee or by another financial institution designated by the
Delaware Trustee, which shall be controlled by the Delaware Trustee; provided
that the rating of the entity maintaining such account shall be at least equal
to the rating of the applicable Funding Note by Moody's and Standard & Poor's,
in which all amounts paid to the Delaware Trustee in respect of such Funding
Note or any Collateral related thereto will be held and from which the Delaware
Trustee shall make any payments pursuant to Section 3.1(b) and Article 7 of this
Amended and Restated Trust Agreement, to the extent such amounts are paid to the
Delaware Trustee and deposited in the applicable Payment Account.
"Person" means any natural person, corporation, limited partnership,
general partnership, joint stock company, joint venture, association, company,
limited liability company, trust (including any beneficiary thereof), bank,
trust company, land trust, business trust, statutory trust or other
organization, whether or not a legal entity, and governments and agencies and
political subdivisions thereof.
"Program" has the meaning ascribed in the second recital.
"Program Documents" means each Series Instrument and each Closing
Instrument (including documents contained in each Series Instrument and each
Closing Instrument), this Amended and Restated Trust Agreement, the Amended and
Restated Administrative Services Agreement, the Amended and Restated Support
Agreement, the Amended and Restated Name Licensing Agreement, the Distribution
Agreement, each Funding Note and any other documents or instruments entered into
by, or with respect to, or on behalf of, Global Funding or any Trust in
connection with the Program.
"Rating Agency" means each of Moody's, Standard & Poor's and any other
rating agency which provides a rating of any Notes or the Program.
"Registration Statement" means the Registration Statement relating to the
Program (File No. 333-129157), filed with the Commission by Allstate Life and
Global Funding on October 20, 2005, as amended by Amendment No. 1 filed with the
Commission on November 29, 2005, and Amendment No. 2 filed with the Commission
on -, 2006, and as it may further be amended, supplemented, modified, restated
or
5
replaced from time to time.
"Responsible Officer" means any vice president, assistant vice president,
any assistant secretary, any assistant treasurer, any trust officer or assistant
trust officer, or any other officer of the Delaware Trustee, as the case may be,
customarily performing functions similar to those performed by any of the above
designated officers and also, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of his or her
knowledge of and familiarity with the particular subject.
"Secretary of State" means the Secretary of State of the State of Delaware.
"Securities Act" means the Securities Act of 1933, as amended, and any
successor statute thereto, and the rules, regulations and published
interpretations of the Commission promulgated thereunder from time to time.
"Security Interest", with respect to any Funding Note, has the meaning
ascribed in the applicable Funding Note Indenture.
"Series Instrument" means, with respect to any Trust, the Series Instrument
of the Trust, pursuant to which the Funding Note Indenture, the Indenture and
certain other agreements are entered into, and certain other documents are
executed, in connection with the issuance of the Notes by the Trust.
"Standard and Poor's" means Standard & Poor's Ratings Services, a division
of The McGraw-Hill Companies, Inc.
"Standing Order" has the meaning ascribed in Section 3.1(d).
"Supplemental Funding Note Indenture", with respect to any Funding Note,
has the meaning ascribed in the applicable Funding Note Indenture.
"Terms Agreement" means, with respect to any Trust, the Terms Agreement
included in Part E of the applicable Series Instrument.
"Trust" has the meaning ascribed in the third recital.
"Trust Beneficial Owner" means AMACAR Pacific Corp., in its capacity as the
sole beneficial owner of Global Funding, and its successors.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended,
and any successor statute thereto, and the rules, regulations and published
interpretations of the Commission promulgated thereunder from time to time.
"UCC" means the Uniform Commercial Code, as from time to time in effect in
the State of New York.
6
SECTION 1.2 Other Definitional Provisions. For all purposes of this Amended
and Restated Trust Agreement except as otherwise expressly provided or unless
the context otherwise requires:
(a) the terms defined in this Article shall have the meanings ascribed
to them in this Article and shall include the plural as well as the
singular;
(b) all accounting terms not otherwise defined in this Amended and
Restated Trust Agreement have the meanings assigned to them in accordance
with generally accepted accounting principles in the United States and,
except as otherwise expressly provided in this Amended and Restated Trust
Agreement, the term "generally accepted accounting principles" with respect
to any computation required or permitted under this Amended and Restated
Trust Agreement shall mean such accounting principles as are generally
accepted at the date of such computation in the United States;
(c) the words "include", "includes" and "including" shall be construed
to be followed by the words "without limitation"; and
(d) Article and Section headings are for the convenience of the reader
and shall not be considered in interpreting this Amended and Restated Trust
Agreement or the intent of the parties to this Amended and Restated Trust
Agreement.
ARTICLE 2
CONTINUATION OF GLOBAL FUNDING
SECTION 2.1 Name; Amendment and Restatement of the Base Trust Agreement.
(a) The name of the trust continued hereby is "Allstate Life Global
Funding." Global Funding's activities may be conducted under the name of
Global Funding by the Delaware Trustee or by the Administrator on behalf of
Global Funding.
(b) The parties hereto agree that, upon the execution of this Amended
and Restated Trust Agreement:
(i) the Base Trust Agreement shall continue in full force and
effect as amended and restated by this Amended and Restated Trust
Agreement;
(ii) the rights and obligations of the parties hereto shall be as
provided in this Amended and Restated Trust Agreement, and, except as
otherwise expressly provided in this Amended and Restated Trust
Agreement, in the Delaware Statutory Trust Act; and
7
(iii) except as otherwise provided in Article 7, Global Funding
will continue without dissolution.
SECTION 2.2 Office of the Delaware Trustee; Principal Place of Business.
The principal office of Global Funding shall be in care of the Delaware Trustee
at the Corporate Trust Office, or such other address in the State of Delaware as
the Delaware Trustee may designate by written notice to the Trust Beneficial
Owner, the Administrator and the Rating Agencies. Global Funding shall also
maintain an office in care of the Administrator at:
c/o AMACAR Pacific Corp.
6525 Morrison Boulevard, Suite 318
Charlotte, North Carolina 28211
Attention: President
or at such other address as the Administrator may designate by written notice to
the Trust Beneficial Owner, the Indenture Trustee, the Delaware Trustee and the
Rating Agencies.
SECTION 2.3 Statutory Trust. It is the intention of the parties that Global
Funding constitute a statutory trust organized under the Delaware Statutory
Trust Act and that this Amended and Restated Trust Agreement constitute the
governing instrument of Global Funding. The Delaware Trustee shall file an
Amended and Restated Certificate of Trust with the Secretary of State.
SECTION 2.4 Trust Beneficial Owner. The Trust Beneficial Owner previously
made a cash contribution to Global Funding in the amount of $1,000 in exchange
for its beneficial interest in Global Funding. The beneficial interest of the
Trust Beneficial Owner in Global Funding is not and will not be represented by
any certificate or other instrument. The Trust Beneficial Owner is and shall
continue to be the beneficial owner of Global Funding and has and shall have an
undivided beneficial ownership interest in the property related to Global
Funding. To the fullest extent permitted by law, any attempted transfer of the
Trust Beneficial Owner's interest in Global Funding shall be void.
SECTION 2.5 Purposes of Global Funding. The exclusive purposes and
functions of Global Funding are, and Global Funding shall have the power and
authority, to:
(a) beneficially own each Trust;
(b) issue a Funding Note to each Trust in connection with the Program;
(c) use the net proceeds from the sale of each Funding Note to acquire
one or more Funding Agreements from Allstate Life;
8
(d) grant a security interest in, pledge and collaterally assign each
Funding Agreement to the Funding Note Indenture Trustee and immediately
thereafter assign absolutely each Funding Agreement to, and deposit each
such Funding Agreement into, the relevant Trust;
(e) file with the Commission and execute:
(i) one or more registration statements on Form S-3 or other
appropriate form, including one or more prospectuses, prospectus
supplements and the exhibits thereto, any pre-effective or
post-effective amendments thereto and any registration statements
filed subsequent thereto under rules promulgated under the Securities
Act, relating to the registration of any Notes and/or any Funding
Notes under the Securities Act;
(ii) any preliminary prospectus or prospectus or supplement
thereto relating to any Notes and/or any Funding Notes required to be
filed pursuant to the Securities Act; and
(iii) registration statements and such other documents, forms or
filings as may be required by the Securities Act, the Exchange Act or
the Trust Indenture Act, or other securities laws in each case
relating to any Notes and/or any Funding Notes;
(f) file and execute such filings, applications, reports, surety
bonds, irrevocable consents, appointments of attorney for service of
process and other papers and documents as may be necessary or desirable to
register, or establish the exemption from registration of, any Notes and/or
any Funding Notes under the securities or "Blue Sky" laws of any relevant
jurisdictions; and
(g) engage in other activities and enter into other agreements, in
each case that are necessary, suitable or convenient to accomplish the
foregoing or are incidental to or connected with those activities,
including the execution, delivery and performance of each Series
Instrument, each Closing Instrument and each Program Document to which it
is a signatory.
SECTION 2.6 Allocation of Trust Expenses. Any costs and expenses of Global
Funding shall be paid by Allstate Life pursuant to the Amended and Restated
Support Agreement to the extent provided therein.
SECTION 2.7 Liability. None of the Delaware Trustee, the Administrator, the
Trust Beneficial Owner or any Holder shall have any personal liability for any
liability or obligation of Global Funding.
SECTION 2.8 Income Tax Treatment. The parties agree, and each Holder and
beneficial owner any Funding Note by purchasing such Funding Note agrees, for
all
9
United States Federal, state and local income and franchise tax purposes (i)
to treat such Funding Note as indebtedness of Allstate Life, (ii) that Global
Funding and the Trust will be ignored and will not be treated as an association
or a publicly traded partnership taxable as a corporation and (iii) to not take
any action inconsistent with the treatment described in (i) and (ii) unless
otherwise required by law.
SECTION 2.9 Situs of Global Funding. Global Funding shall be located in the
State of Delaware. Global Funding shall have the right to change its domicile
from Delaware to any other jurisdiction. All bank accounts maintained by the
Delaware Trustee on behalf of Global Funding shall be located in the State of
Delaware. Global Funding shall not have any employees in any state other than in
the State of Delaware.
ARTICLE 3
PAYMENT ACCOUNTS
SECTION 3.1 Payment Accounts.
(a) Prior to the issue date of each Funding Note, the Delaware Trustee
shall establish the related Payment Account. The Delaware Trustee and any
agent of the Delaware Trustee shall have exclusive control and sole right
of withdrawal with respect to each Payment Account for the purpose of
making deposits in and withdrawals from such Payment Account in accordance
with this Amended and Restated Trust Agreement. Subject to each Funding
Note Indenture, all funds or other property received by the Delaware
Trustee on behalf of Global Funding in respect of any Collateral for the
applicable Funding Note will be deposited in the related Payment Account.
All funds and other property deposited or held from time to time in a
Payment Account shall be held by the Delaware Trustee in such Payment
Account for the exclusive benefit of the Trust Beneficial Owner, subject to
the security interest in the applicable Collateral in favor of the
applicable Funding Note Indenture Trustee on behalf of the Holder of the
applicable Funding Note and any other Person for whose benefit such Funding
Note Indenture Trustee is or will be holding such Collateral, and for
distribution by the Delaware Trustee as provided in this Amended and
Restated Trust Agreement, including (and subject to) any priority of
payments provided for in this Amended and Restated Trust Agreement.
(b) All funds and other property deposited into a Payment Account
shall be distributed by Global Funding as follows:
FIRST, to the applicable Funding Note Indenture Trustee for the
payment of all amounts then due and unpaid upon the applicable Funding
Note and any other amounts due and payable in accordance with the
applicable Funding Note Indenture; and
10
SECOND, upon the final surrender of the applicable Funding Note
and payment of any amounts payable in respect thereof, any remaining
funds and other property deposited into such Payment Account shall be
distributed to the Delaware Trustee for distribution pursuant to
Section 7.1.
(c) The Delaware Trustee shall deposit in the applicable Payment
Account, promptly upon receipt, any payments received in respect of any
related Collateral. Amounts held in any Payment Account shall not be
invested by the Delaware Trustee.
(d) Notwithstanding anything in this Amended and Restated Trust
Agreement to the contrary, the Delaware Trustee, on behalf of Global
Funding, shall execute a standing order (each, a "Standing Order") to each
Funding Note Indenture Trustee pursuant to which such Funding Note
Indenture Trustee, either directly or through an applicable Funding Note
Paying Agent, shall distribute all applicable amounts due and unpaid under
Section 3.1(b); provided, however, that all payments to be made pursuant to
Section 7.1 shall be made by the Delaware Trustee on behalf of Global
Funding. For so long as (i) the Delaware Trustee, on behalf of Global
Funding, has not rescinded the applicable Standing Order and (ii) the
applicable Funding Note Indenture Trustee, either directly or through an
applicable Funding Note Paying Agent, is able to, and does, comply with
such Standing Order, the Delaware Trustee will not be required to establish
a separate Payment Account in accordance with Section 3.1 in respect of the
applicable Funding Note; provided, however, that the Delaware Trustee shall
establish a separate payment account to facilitate payments to be made
pursuant to Section 7.1.
ARTICLE 4
FUNDING NOTES
SECTION 4.1 Issuance of Funding Notes. Global Funding shall issue and
deliver or cause to be issued and delivered Funding Notes from time to time in
connection with the Program.
SECTION 4.2 Acquisition of Funding Agreement(s); Redemption and
Satisfaction of Funding Notes. In connection with the issuance and sale of each
Funding Note, Global Funding will use the proceeds received from the offering of
such Funding Note to purchase one or more Funding Agreements. Global Funding
will immediately pledge and collaterally assign each such Funding Agreement to
the Funding Note Indenture Trustee and immediately thereafter assign absolutely
to, and deposit into, the relevant Trust the Funding Agreement(s), and the
Funding Note will be surrendered. The Funding Note shall be cancelled by Global
Funding immediately upon such surrender, and such cancellation shall operate as
a redemption and satisfaction of the Funding Note.
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ARTICLE 5
REPRESENTATIONS AND WARRANTIES BY THE DELAWARE TRUSTEE
The Delaware Trustee represents and warrants for the benefit of each Holder
and the Trust Beneficial Owner as follows:
(a) it is a banking corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware and it is a "bank"
within the meaning of Section 581 of the Code;
(b) it is a "United States person" within the meaning of Section
7701(a)(30) of the Code;
(c) it has full corporate or other power, authority and legal right to
execute, deliver and perform its obligations under this Amended and
Restated Trust Agreement and has taken all necessary action to authorize
the execution, delivery and performance by it of this Amended and Restated
Trust Agreement;
(d) this Amended and Restated Trust Agreement has been duly
authorized, executed and delivered by it and constitutes the valid and
legally binding agreement of it enforceable against it in accordance with
its terms;
(e) neither the execution or delivery by it of this Amended and
Restated Trust Agreement, nor the performance by it of its obligations
under this Amended and Restated Trust Agreement, will (i) violate its
organizational documents, (ii) violate any provision of, or constitute,
with or without notice or lapse of time, a default under, or result in the
creation or imposition of any Lien on any properties or assets held in
Global Funding pursuant to the provisions of, any indenture, mortgage,
credit agreement, license or other contract, agreement, judgment, order or
instrument to which it is a party or by which it is bound, or (iii) violate
any law, governmental rule or regulation of the State of Delaware or the
United States governing the banking, trust or general powers of it or any
order, judgment or decree applicable to it;
(f) the authorization, execution or delivery by it of this Amended and
Restated Trust Agreement and the consummation of any of the transactions by
it contemplated by this Amended and Restated Trust Agreement do not require
the consent or approval of, the giving of notice to, the registration with
or the taking of any other action with respect to any governmental
authority or
12
agency (other than the filing of the Amended and Restated Certificate of
Trust with the Secretary of State); and
(g) there are no proceedings pending or, to the best of its knowledge,
threatened against or affecting it in any court or before any governmental
authority, agency or arbitration board or tribunal which, individually or
in the aggregate, would materially and adversely affect Global Funding or
would question the right, power and authority of the Delaware Trustee to
enter into or perform its obligations under this Amended and Restated Trust
Agreement.
ARTICLE 6
DELAWARE TRUSTEE
SECTION 6.1 General Authority.
(a) The Delaware Trustee is authorized and empowered, among other
things, to: (i) execute and deliver on behalf of Global Funding the Program
Documents and each certificate or other document attached as an exhibit to,
or contemplated by, the Program Documents and any amendment or other
agreement to any of the Program Documents; (ii) take all actions required
of Global Funding pursuant to the Program Documents including, but not
limited to (A) paying, or causing to be paid, on behalf of Global Funding
any amounts due and owing by Global Funding under the Program Documents or
any other documents or instruments to which Global Funding is a party, (B)
providing certificates required under the Program Documents or other
documents or instruments to which Global Funding is a party and (C)
preparing for execution or executing amendments to and waivers under the
Program Documents or any other documents or instruments deliverable by
Global Funding thereunder or in connection therewith or with this Amended
and Restated Trust Agreement; (iii) cause Global Funding to perform under
the Program Documents; and (iv) engage in those activities, including
entering into agreements, that are necessary, suitable or convenient to
accomplish the foregoing or any of the other purposes of Global Funding or
are incidental thereto or connected therewith including, from time to time,
taking such action on behalf of Global Funding as is permitted by the
Program Documents. In addition to any other duties under this Amended and
Restated Trust Agreement, the Delaware Trustee shall be the trustee of
Global Funding for the purpose of fulfilling the requirements of Section
3807 of the Delaware Statutory Trust Act. Subject to the limitations set
forth in Section 6.1(b), the Delaware Trustee shall have the power and
authority to act on behalf of Global Funding, with respect to the following
matters:
(i) to execute and deliver on behalf of Global Funding the
Funding Notes and the Amended and Restated Certificate of Trust in
accordance with this Amended and Restated Trust Agreement;
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(ii) to cause Global Funding to perform this Amended and Restated
Trust Agreement and to enter into, and to execute, deliver and
perform, the Funding Notes, each Series Instrument and each Closing
Instrument (including all relevant documents contained in each Series
Instrument and each Closing Instrument), the Distribution Agreement,
the Amended and Restated Name Licensing Agreement, the Amended and
Restated Support Agreement, the Amended and Restated Administrative
Services Agreement, each other Program Document and such other
certificates, other documents or agreements as may be necessary,
contemplated by or desirable in connection with the purposes and
function of Global Funding or any of the above-referenced documents;
(iii) to receive custody of any Funding Agreement and to exercise
on behalf of Global Funding all of the rights, powers and privileges
of an owner or policyholder of each such Funding Agreement in
accordance with the terms of such Funding Agreement and any related
documents;
(iv) to cause Global Funding to immediately pledge and
collaterally assign each Funding Agreement to the Funding Note
Indenture Trustee and to immediately thereafter assign absolutely to,
and deposit into, the relevant Trust the relevant Funding
Agreement(s);
(v) to establish each Payment Account and a separate payment
account to facilitate payments to the Trust Beneficial Owner;
(vi) to send any notices regarding any Funding Note to Allstate
Life, the Rating Agencies, the Trust Beneficial Owner and the
applicable Agents under the relevant Terms Agreement in accordance
with the terms of the relevant Funding Note and this Amended and
Restated Trust Agreement;
(vii) to take all actions necessary or appropriate to enable
Global Funding to comply with Section 2.8 regarding income tax
treatment;
(viii) after the occurrence of a Funding Agreement Event of
Default actually known to a Responsible Officer, to take any action as
it may from time to time determine (based solely upon the advice of
counsel) is necessary or advisable to give effect to the terms of this
Amended and Restated Trust Agreement (without consideration of the
effect of any such action on any particular Holder) and, within five
Business Days after the occurrence of a Funding Agreement Event of
14
Default actually known to a Responsible Officer, to give notice
thereof to the Administrator and the Trust Beneficial Owner;
(ix) to the extent permitted by this Amended and Restated Trust
Agreement, to participate in the winding up of the affairs of and
liquidation of Global Funding and assist with the preparation,
execution and filing of a certificate of cancellation with the
Secretary of State;
(x) to take any action and to execute any documents on behalf of
Global Funding incidental to the foregoing, as the Delaware Trustee
may from time to time determine (based on the advice of counsel) is
necessary or advisable to give effect to the terms of this Amended and
Restated Trust Agreement;
(xi) to execute and file documents with the Secretary of State;
and
(xii) to accept service of process on behalf of Global Funding in
the State of Delaware.
It is expressly understood and agreed that the Delaware Trustee
shall be entitled to engage outside counsel, independent accountants
and other experts appointed with due care to assist the Delaware
Trustee in connection with the performance of its duties and powers
set forth in this Section 6.1(a), including, without limitation,
certificates, reports, opinions, notices or any other documents. The
Delaware Trustee shall be entitled to rely conclusively on the advice
of such counsel, accountants and other experts in the performance of
all its duties under this Amended and Restated Trust Agreement and
shall have no liability for any documents prepared by such counsel,
accountants or experts or any action or inaction taken pursuant to the
advice of such counsel, accountants or experts. Any expenses of such
counsel, accountants and experts shall be paid by Global Funding.
(b) So long as this Amended and Restated Trust Agreement remains in
effect, Global Funding (and the Delaware Trustee and the Administrator
acting on behalf of Global Funding) shall not undertake any business,
activity or transaction except as expressly provided for or contemplated by
this Amended and Restated Trust Agreement or by any Funding Note Indenture.
In particular, Global Funding shall not, except as otherwise contemplated
by this Amended and Restated Trust Agreement or by any Funding Note
Indenture:
(i) sell, transfer, exchange, assign, lease, convey or otherwise
dispose of any assets held in Global Funding, except for any Funding
15
Agreements (as of the date of this Amended and Restated Trust
Agreement or hereafter acquired);
(ii) engage in any business or activity other than in connection
with, or relating to, (A) the performance of this Amended and Restated
Trust Agreement and the execution, delivery and performance of any
documents, including the Program Documents (other than this Amended
and Restated Trust Agreement as set forth above), relating to the
Funding Notes and the transactions contemplated thereby and (B) any
activities, including entering into agreements that are necessary,
suitable or convenient to accomplish the purposes of Global Funding
specified in Section 2.5;
(iii) incur, directly or indirectly, any Debt except for each
Funding Note;
(iv) create, incur, assume or permit any Lien or other
encumbrance on any of its properties or assets owned or thereafter
acquired, or any interest therein or the proceeds thereof, except for
the lien created pursuant to each Funding Note Indenture;
(v) amend, modify or fail to comply with any material provision
of this Amended and Restated Trust Agreement, except for any amendment
or modification of this Amended and Restated Trust Agreement expressly
permitted under this Amended and Restated Trust Agreement;
(vi) own any subsidiary, except for the Trusts, or lend or
advance any funds to, or make any investment in, any Person, except in
connection with any Funding Notes, the Amended and Restated
Administrative Services Agreement, the Amended and Restated Support
Agreement and any Funding Agreement;
(vii) directly or indirectly declare or make any distribution or
other payment to, or redeem or otherwise acquire or retire for value
the interests of, the Trust Beneficial Owner if any amount under the
Funding Notes or the Notes is due and unpaid, or directly or
indirectly redeem or otherwise acquire or retire for value any Debt
other than any Funding Note if any Funding Note remains outstanding;
(viii) become required to register as an "investment company"
under and as such term is defined in the Investment Company Act of
1940, as amended;
16
(ix) enter into any transaction of merger or consolidation or
liquidate or dissolve itself (or, to the fullest extent permitted by
law, suffer any liquidation or dissolution), or acquire by purchase or
otherwise all or substantially all the business or assets of, or any
stock or other evidence of beneficial ownership of, any Person, except
for the Trusts;
(x) take any action that would cause Global Funding not to be
either ignored or treated as a "grantor trust" for United States
Federal income tax purposes;
(xi) have any employees other than the Delaware Trustee, the
Administrator or any other persons necessary to conduct its business
and enter into transactions contemplated under the Program Documents;
(xii) have an interest in any bank account other than those
accounts required or permitted under the Program Documents;
(xiii) permit any Affiliate, employee or officer of Allstate Life
or any agent of Allstate Life or Agent to be a trustee of Global
Funding;
(xiv) issue any Funding Note unless (A) Global Funding has
purchased or will simultaneously purchase the relevant Funding
Agreement(s) from Allstate Life; (B) Global Funding will grant a
security interest in, pledge and collaterally assign the relevant
Funding Agreement(s) to the Funding Note Indenture Trustee and will
immediately thereafter assign absolutely to and deposit into the
relevant Trust the relevant Funding Agreement(s); and (C) the relevant
Funding Note will thereupon be surrendered and cancelled by Global
Funding immediately upon such surrender, and such cancellation shall
operate as a redemption and satisfaction of the Funding Note;
(xv) commingle any of its assets with assets of any of Global
Funding's Affiliates, or guarantee any obligation of any of Global
Funding's Affiliates;
(xvi) (A) permit the validity or effectiveness of any Funding
Note Indenture or the Security Interest securing the Funding Note
issued pursuant to any Funding Note Indenture to be impaired, or
permit such Security Interest to be amended, hypothecated,
subordinated, terminated or discharged, (B) permit any Person to be
released from any covenants or obligations under any Funding Agreement
securing any Funding Note, except as expressly permitted thereunder,
under the applicable Funding Note Indenture, this Amended and Restated
Trust Agreement, or each applicable Funding Agreement, (C) create,
incur, assume, or permit any
17
Lien or other encumbrance (other than the Security Interests securing
the Funding Notes) on any of its properties or assets (whenever
acquired), or any interest therein or the proceeds thereof, or (D)
permit a lien with respect to any Collateral not to constitute a valid
first priority perfected security interest in such Collateral securing
the related Funding Note;
(xvii) issue any Funding Note unless the Funding Agreement
Provider has affirmed in writing to Global Funding that it has made
changes to its books and records to reflect the grant of a security
interest in, and the making of an assignment for collateral purposes
of, the relevant Funding Agreement(s) by Global Funding to the
applicable Funding Note Indenture Trustee in accordance with the terms
of such Funding Agreement(s) and the applicable Funding Note Indenture
and Global Funding has taken such other steps as may be necessary to
cause the Security Interest in or assignment for all collateral
purposes of, the applicable Collateral to be perfected for purposes of
the UCC or effective against its creditors and subsequent purchasers
of such Collateral pursuant to insurance or other state laws; or
(xviii) make any deduction or withholding from any payment of
principal of or interest on any Funding Note (other than amounts that
may be required to be withheld or deducted from such payments under
the Code or any other applicable tax law) by reason of the payment of
any taxes levied or assessed upon any portion of the related
Collateral except to the extent specified in the applicable Funding
Note Indenture or the relevant Funding Note Certificate or
Supplemental Funding Note Indenture.
(c) Notwithstanding any other provision of this Amended and Restated
Trust Agreement, the Delaware Trustee and the Administrator, acting on
behalf of Global Funding, shall not take any action that would cause Global
Funding not to be either ignored or treated as a "grantor trust" for United
States Federal income tax purposes.
(d) The Delaware Trustee shall, based on the advice of counsel, defend
against all claims and demands of all Persons at any time claiming any Lien
on any of the assets of Global Funding adverse to the interest of Global
Funding or any Holder.
(e) The Delaware Trustee is authorized and directed to conduct the
affairs of Global Funding and to operate Global Funding so that Global
Funding will not (i) become required to register as an "investment company"
under the Investment Company Act or (ii) fail to be either ignored or
treated as a "grantor trust" for United States Federal income tax purposes.
In connection with the preceding sentence, the Delaware Trustee shall have
no duty to determine
18
whether any action it takes complies with the preceding sentence and shall
be entitled to rely conclusively on an opinion of counsel with respect to
any such matters.
SECTION 6.2 General Duties. It shall be the duty of the Delaware Trustee to
discharge, or cause to be discharged, all of its responsibilities pursuant to
the terms of this Amended and Restated Trust Agreement, or any other documents
or instruments to which it is a party, and to administer Global Funding, in
accordance with the provisions of this Amended and Restated Trust Agreement and
the other Program Documents and any other documents or instruments to which
Global Funding is a party. Notwithstanding the foregoing, the Delaware Trustee
shall be deemed to have discharged its duties and responsibilities under this
Amended and Restated Trust Agreement and any other documents or instruments to
which Global Funding is a party to the extent (a) such duties and
responsibilities shall have been performed by the Administrator and (b) the
Administrator is required or permitted under this Amended and Restated Trust
Agreement, under the Amended and Restated Administrative Services Agreement or
under any other documents or instruments to which Global Funding is a party, to
perform such act or discharge such duty of the Delaware Trustee or Global
Funding; provided, however, that the Delaware Trustee shall not be held liable
for the default or failure of the Administrator to carry out its required
obligations under this Amended and Restated Trust Agreement or thereunder but
only to the extent such obligations are not also required to be carried out by
the Delaware Trustee.
SECTION 6.3 Specific Duties.
(a) The Delaware Trustee will manage the business and affairs of
Global Funding in accordance with the terms of the Delaware Statutory Trust
Act; provided, however, that the Delaware Trustee undertakes to perform
only such duties as are specifically set forth in this Amended and Restated
Trust Agreement and as it may be directed from time to time by the
Administrator or the Trust Beneficial Owner in accordance with the terms of
this Amended and Restated Trust Agreement.
(b) The Delaware Trustee shall not take any action, or direct the
Administrator to take any action, which would be inconsistent with Section
2.8.
SECTION 6.4 Acceptance of Trust and Duties; Limitation on Liability.
The Delaware Trustee agrees to perform its duties under this Amended and
Restated Trust Agreement with respect to Global Funding, but only upon the terms
of this Amended and Restated Trust Agreement. No implied covenants or
obligations shall be read into this Amended and Restated Trust Agreement. The
Delaware Trustee shall not be liable under this Amended and Restated Trust
Agreement under any circumstances except for (i) its own willful misconduct, bad
faith or gross negligence, (ii) its failure to use ordinary care to disburse
funds, or (iii) the inaccuracy of any
19
representation or warranty contained in this Amended and Restated Trust
Agreement expressly made by the Delaware Trustee. In particular (but without
limitation), subject to the exceptions set forth in the preceding sentence:
(a) the Delaware Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless such error of judgment
constitutes gross negligence;
(b) the Delaware Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance with
the written instructions of the Administrator or the Trust Beneficial Owner
or pursuant to the advice of counsel, accountants or other experts selected
by it in good faith, so long as such action or omission is consistent with
the terms of this Amended and Restated Trust Agreement;
(c) no provision of this Amended and Restated Trust Agreement shall
require the Delaware Trustee to expend or risk personal funds or otherwise
incur any financial liability in the performance of any of its rights or
powers under this Amended and Restated Trust Agreement if the Delaware
Trustee shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not
reasonably assured or provided to it;
(d) under no circumstances shall the Delaware Trustee be liable for
indebtedness or other obligations evidenced by or arising under this
Amended and Restated Trust Agreement, any Funding Agreement or any related
document, including the principal of and interest on any Funding Note;
(e) the Delaware Trustee shall not be responsible for, or in respect
of, the validity or sufficiency of this Amended and Restated Trust
Agreement or any related document or for the due execution of this Amended
and Restated Trust Agreement or thereof by any party (except by the
Delaware Trustee itself), other than the signature and countersignature of
the Delaware Trustee on any of the Program Documents and the execution of
any certificate;
(f) the Delaware Trustee shall (i) not be liable for any action,
inaction, default or misconduct of the Administrator in respect of any
Funding Note or any related documents or otherwise, and (ii) not have any
obligation or liability to perform the obligations of Global Funding under
this Amended and Restated Trust Agreement or any related document or under
any Federal, state, foreign or local tax or securities law, in each case,
that are required to be performed by other Persons, including the
Administrator under the Amended and Restated Administrative Services
Agreement;
20
(g) the Delaware Trustee shall not be liable for any action, inaction,
default or misconduct of Allstate Life, and the Delaware Trustee shall not
have any obligation or liability to perform the obligations of Allstate
Life under any Funding Agreement or any related documents;
(h) the Delaware Trustee shall not be under any obligation to exercise
any of the rights or powers vested in it by this Amended and Restated Trust
Agreement, or to institute, conduct or defend any litigation under this
Amended and Restated Trust Agreement or otherwise or in relation to this
Amended and Restated Trust Agreement or any related document, at the
request, order or direction of any Person unless such Person has offered to
the Delaware Trustee security or indemnity satisfactory to it against the
costs, expenses and liabilities that may be incurred by the Delaware
Trustee. The right of the Delaware Trustee to perform any discretionary act
enumerated in this Amended and Restated Trust Agreement or in any related
document shall not be construed as a duty, and the Delaware Trustee shall
not be answerable in connection therewith other than for its gross
negligence or willful misconduct in the performance of any such act;
(i) except as expressly provided in this Amended and Restated Trust
Agreement, in accepting the trusts created by this Amended and Restated
Trust Agreement, the Delaware Trustee acts solely as trustee under this
Amended and Restated Trust Agreement and not in its individual capacity,
and all Persons having any claim against the Delaware Trustee by reason of
the transactions contemplated by this Amended and Restated Trust Agreement
shall look only to Global Funding's property for payment or satisfaction
thereof;
(j) the Delaware Trustee shall in no event assume or incur any
liability, duty or obligation to the Administrator, the Trust Beneficial
Owner or any other Person other than as expressly provided for in this
Amended and Restated Trust Agreement;
(k) the Delaware Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note or other paper or document;
(l) every provision of this Amended and Restated Trust Agreement
relating to the Delaware Trustee shall be subject to the provisions of this
Article 6;
(m) except in accordance with the written instructions furnished by
the Trust Beneficial Owner or as provided in this Amended and Restated
Trust Agreement, the Delaware Trustee shall have no duty to: (i) see to any
recording or filing of any document, (ii) confirm or verify any financial
statements of the
21
Administrator or the Trust Beneficial Owner, (iii) inspect the
Administrator's or the Trust Beneficial Owner's books and records at any
time or (iv) see to the payment or discharge of any tax, assessment or
other governmental charge or any lien or encumbrance of any kind owing with
respect to, assessed or levied against any part of Global Funding, except
to the extent the Delaware Trustee has received funds, on behalf of Global
Funding, pursuant to the Amended and Restated Support Agreement from
Allstate Life in satisfaction of any such tax, assessment or other
governmental charge or any lien or encumbrance of any kind and in
accordance with payment or transfer instructions provided by Allstate Life;
(n) the Delaware Trustee shall have no duty or obligation to manage,
control, use, sell, dispose of or otherwise deal with Global Funding or to
otherwise take or refrain from taking any action under this Amended and
Restated Trust Agreement, except as expressly required by the terms of this
Amended and Restated Trust Agreement, or as expressly provided in written
instructions from the Administrator, and in no event shall the Delaware
Trustee have any implied duties or obligations under this Amended and
Restated Trust Agreement; the Delaware Trustee nevertheless agrees that it
will, at its own cost and expense, promptly take all action as may be
necessary to discharge any liens on any part of the property of Global
Funding which result from claims against the Delaware Trustee personally
that are not related to the ownership or the administration of the property
of Global Funding or the transactions contemplated by the Program
Documents;
(o) the Delaware Trustee shall not be required to take any action
under this Amended and Restated Trust Agreement unless the Delaware Trustee
shall have been indemnified by Global Funding, in manner and form
satisfactory to the Delaware Trustee, against any liability, cost or
expenses (including counsel fees and disbursements) which may be incurred
in connection therewith, and, in addition, Global Funding shall pay the
reasonable compensation of the Delaware Trustee for the services performed;
provided, that the Delaware Trustee shall not be indemnified by any Person
for the Delaware Trustee's willful misconduct, bad faith or gross
negligence, its failure to use ordinary care to disburse funds or the
inaccuracy of its own representations or warranties, made in its individual
capacity, contained in this Amended and Restated Trust Agreement;
(p) the Delaware Trustee shall not be required to take any action
under this Amended and Restated Trust Agreement if the Delaware Trustee
shall reasonably determine or shall have been advised by counsel that such
action is contrary to the terms of this Amended and Restated Trust
Agreement or is otherwise contrary to law;
22
(q) the Delaware Trustee may fully rely upon and shall have no
liability in connection with calculations or instructions forwarded to the
Delaware Trustee by the Administrator, nor shall the Delaware Trustee have
any obligation to furnish information to any Person if it has not received
such information as it may need from the Administrator or any other Person;
(r) the Delaware Trustee shall not be liable with respect to any act
or omission in good faith in accordance with the advice or direction of the
Administrator. Whenever the Delaware Trustee is unable to decide between
alternative courses of action permitted or required by the terms of this
Amended and Restated Trust Agreement, or is unsure as to the application,
intent, interpretation or meaning of any provision of this Amended and
Restated Trust Agreement, the Delaware Trustee may give notice (in such
form as shall be appropriate under the circumstances) to the Administrator
requesting instructions as to the course of action to be adopted, and, to
the extent the Delaware Trustee acts in good faith in accordance with any
such instruction received, the Delaware Trustee shall not be liable on
account of such action to any Person. If the Delaware Trustee shall not
have received appropriate instructions within ten days of such notice (or
within such shorter period of time as reasonably may be specified in such
notice or may be necessary under the circumstances), it may, but shall be
under no duty to, take or refrain from taking such action which is
consistent, in its view, with this Amended and Restated Trust Agreement and
as it shall deem to be in the best interest of the Trust Beneficial Owner,
and the Delaware Trustee shall have no liability to any Person for such
action or inaction;
(s) in no event whatsoever shall the Delaware Trustee be personally
liable for any representation, warranty, covenant, agreement, indebtedness
or other obligation of Global Funding;
(t) the Delaware Trustee shall incur no liability if, by reason of any
provision of any present or future law or regulation thereunder, or by any
force majeure event, including but not limited to natural disaster, war or
other circumstances beyond its control, the Delaware Trustee shall be
prevented or forbidden from doing or performing any act or thing which the
terms of this Amended and Restated Trust Agreement provide shall or may be
done or performed; and
(u) notwithstanding anything contained herein to the contrary, the
Delaware Trustee shall not be required to execute, deliver or certify on
behalf of Global Funding any filings, certificates, affidavits or other
instruments required under the Sarbanes-Oxley Act of 2002.
SECTION 6.5 Reliance; Advice of Counsel.
23
(a) The Delaware Trustee shall incur no liability to anyone in acting
upon any signature, instrument, notice, resolution, request, consent,
order, certificate, report, opinion, bond or other document or paper
reasonably believed by it in good faith to be genuine and signed by the
proper party or parties. The Delaware Trustee may accept a certified copy
of a resolution of the board of directors or other governing body of any
corporate party as conclusive evidence that such resolution has been duly
adopted by such body and that the same is in full force and effect. As to
any fact or matter the manner of ascertainment of which is not specifically
prescribed in this Amended and Restated Trust Agreement, the Delaware
Trustee may for all purposes of this Amended and Restated Trust Agreement
rely on a certificate, signed by the president or any vice president or by
the treasurer or any assistant treasurer or the secretary or any assistant
secretary of the relevant party, as to such fact or matter, and such
certificate shall constitute full protection to the Delaware Trustee for
any action taken or omitted to be taken by it in good faith in reliance
thereon.
(b) In the exercise or administration of Global Funding, the Delaware
Trustee may (i) act directly or through its agents or attorneys pursuant to
agreements entered into with any of them; provided, that the Delaware
Trustee shall not be liable for the conduct or misconduct of such agents or
attorneys if such agents or attorneys shall have been selected by the
Delaware Trustee in good faith and with reasonable care, and (ii) consult
with counsel, accountants and other skilled persons to be selected in good
faith and with reasonable care and employed by it, and it shall not be
liable for anything done, suffered or omitted to be done in good faith by
it in accordance with the written opinion or advice of any such counsel,
accountants or other skilled persons.
SECTION 6.6 Delegation of Authorities and Duties. The Delaware Trustee
delegates to the Administrator all duties required to be performed by the
Administrator pursuant to the terms of this Amended and Restated Trust Agreement
and the Administrative Services Agreement. The Delaware Trustee undertakes no
responsibility for the performance, or non-performance, of any duties delegated
to the Administrator under this Amended and Restated Trust Agreement or the
Amended and Restated Administrative Services Agreement, as applicable.
ARTICLE 7
TERMINATION OF AGREEMENT; DISSOLUTION OF GLOBAL FUNDING
SECTION 7.1 Termination of Agreement. This Amended and Restated Trust
Agreement shall terminate and Global Funding shall dissolve, wind-up and
terminate in accordance with Section 3808 of the Delaware Statutory Trust Act
upon the latest to occur of:
(a) the payment to the Holders of any outstanding Funding Notes, to
the holders of all series of Notes and to the Trust Beneficial Owner of all
24
amounts required to be paid pursuant to any Funding Notes, any Funding Note
Indenture, any Notes, any Indenture, this Amended and Restated Trust
Agreement and the Program Documents;
(b) the payment of, or reasonable provision for payment of, all
expenses and other liabilities owed by Global Funding; and
(c) the performance of all administrative actions by the Delaware
Trustee and the Administrator necessary to accomplish the purposes of
Global Funding, including the performance of any tax reporting obligations
with respect to Global Funding.
Any insolvency event, liquidation, dissolution, death or incapacity with
respect to the Trust Beneficial Owner, the Delaware Trustee, the Administrator
or any of the other agents of Global Funding or any Holder shall not (i) operate
to terminate this Amended and Restated Trust Agreement or Global Funding, (ii)
entitle any of their legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of all
or any part of Global Funding, (iii) otherwise affect the rights, obligations
and liabilities of the Holders or the parties hereto or any other document or
any instrument entered into by Global Funding or (iv) dissolve Global Funding.
Global Funding shall dissolve only as provided in this Section 7.1, and
otherwise no Person, including the Administrator and the Trust Beneficial Owner,
shall be entitled to revoke or dissolve Global Funding. The Administrator shall
act as the liquidator of Global Funding and shall be responsible for directing
the Delaware Trustee to take all required actions in connection with winding up
Global Funding. The Delaware Trustee shall have no liability for following such
direction to the extent it acts in good faith.
Upon the last event to occur as described above, the Delaware Trustee shall
cause the Amended and Restated Certificate of Trust to be canceled by filing a
certificate of cancellation with the Secretary of State in accordance with the
provisions of Section 3810 of the Delaware Statutory Trust Act, at which time
Global Funding and this Amended and Restated Trust Agreement shall terminate.
In connection with the termination of Global Funding and the distribution
of all amounts from each Payment Account in accordance with the priority set
forth in Section 3.1(b), the Delaware Trustee will distribute any amounts
received pursuant to Section 3.1(b) (clause Second) and any other remaining
assets of Global Funding in the following order of priority:
First, to pay all expenses and other liabilities owed by Global
Funding; and
25
Second, any remaining funds and other property shall be paid to the
Trust Beneficial Owner.
ARTICLE 8
SUCCESSOR AND ADDITIONAL DELAWARE TRUSTEES
SECTION 8.1 Eligibility Requirements for the Delaware Trustee. The Delaware
Trustee shall at all times (a) be a Person satisfying the provisions of Section
3807(a) of the Delaware Statutory Trust Act, (b) be authorized to exercise
corporate trust powers, (c) have a combined capital and surplus of at least
$50,000,000 and be subject to supervision or examination by Federal or State
authorities, (d) have (or have a parent which has) a rating of at least Baa3 by
Moody's or BBB- by Standard & Poor's, (e) be a "bank" within the meaning of
Section 581 of the Code and (f) be a "United States person" within the meaning
of Section 7701(a)(30) of the Code. In addition, the Delaware Trustee shall be
an entity with its Corporate Trust Office in the State of Delaware. If the
Delaware Trustee shall publish reports of condition at least annually, pursuant
to applicable law or to the requirements of the aforesaid supervising or
examining authority, then for the purpose of this Section 8.1, the combined
capital and surplus of the Delaware Trustee shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time the Delaware Trustee shall cease to be eligible in
accordance with the provisions of this Section 8.1, the Delaware Trustee shall
resign immediately in the manner and with the effect specified in Section 8.2.
SECTION 8.2 Resignation or Removal of the Delaware Trustee. The Delaware
Trustee may resign as Delaware Trustee, or the Administrator, acting on behalf
of Global Funding, may, in its sole discretion, remove the Delaware Trustee, in
each case upon not less than 30 days' prior notice to the Delaware Trustee, each
Funding Note Indenture Trustee, each Indenture Trustee and each Rating Agency
then rating the Program or the Notes. Upon any resignation or removal of the
Delaware Trustee, the Administrator, acting on behalf of Global Funding, shall
appoint a successor Delaware Trustee whereupon such successor Delaware Trustee
shall succeed to the rights, powers and duties of the Delaware Trustee, and the
term "Delaware Trustee" shall thereupon mean such successor Delaware Trustee
effective upon such appointment and approval, and the predecessor Delaware
Trustee's powers and duties as Delaware Trustee shall be terminated, without any
other or further act or deed on the part of such predecessor Delaware Trustee or
any of the parties to this Amended and Restated Trust Agreement or any holders
of the obligations owing hereunder; provided, that if at any time the Delaware
Trustee shall cease to be eligible in accordance with Section 8.1 and shall have
not resigned, or if at any time the Delaware Trustee, shall become incapable of
acting or shall be adjudged bankrupt or insolvent, or a receiver for the
Delaware Trustee or for its property shall appointed, or any public officer
shall take charge or control of the Delaware Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then the
Administrator may remove the Delaware Trustee. On and after the effective date
of any resignation or removal of the
26
Delaware Trustee hereunder, the provisions of this Article 8 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Delaware Trustee under this Amended and Restated Trust Agreement. Any such
resignation or removal shall become effective following the appointment of a
successor Delaware Trustee in accordance with the provisions of this Section
8.2.
If no successor Delaware Trustee shall be appointed and shall have accepted
such appointment within 30 days after the aforesaid notice of resignation or
removal, Global Funding (or the Administrator, acting on its behalf) or the
resigning Delaware Trustee may apply to any court of competent jurisdiction to
appoint a successor Delaware Trustee to act until such time, if any, as a
successor Delaware Trustee shall have been appointed as provided in this Section
8.2. Any successor so appointed by such court shall immediately and without
further act be superseded by any successor Delaware Trustee appointed pursuant
to this Section 8.2.
Any resignation or removal of the Delaware Trustee and appointment of a
successor Delaware Trustee pursuant to any of the provisions of this Section 8.2
shall not become effective until all fees and expenses, including any indemnity
payments, due to the outgoing Delaware Trustee have been paid and until
acceptance of appointment by the successor Delaware Trustee pursuant to Section
8.3.
If at any time the Delaware Trustee shall resign or be removed or otherwise
become incapable of acting, or if at any time a vacancy shall occur in the
office of the Delaware Trustee for any other cause, a successor Delaware Trustee
shall be appointed as set forth in this Section 8.2. The powers, duties,
authority and title of the predecessor Delaware Trustee shall be terminated and
canceled without any formality (except as may be required by applicable law)
other than appointment and designation of a successor Delaware Trustee in
writing duly acknowledged and delivered to the predecessor Delaware Trustee and
Global Funding.
SECTION 8.3 Successor Delaware Trustee. Each successor Delaware Trustee
appointed pursuant to Section 8.2 shall execute, acknowledge and deliver to the
Administrator, the Trust Beneficial Owner and the predecessor Delaware Trustee
an instrument accepting such appointment under this Amended and Restated Trust
Agreement, and thereupon the resignation or removal of the predecessor Delaware
Trustee shall become effective, the resigning Delaware Trustee shall be released
of all duties and trusts under this Amended and Restated Trust Agreement and
such successor Delaware Trustee, without any further act, deed or conveyance,
shall become fully vested with all the rights, powers, duties, and obligations
of its predecessor under this Amended and Restated Trust Agreement, with like
effect as if originally named as Delaware Trustee. The predecessor Delaware
Trustee shall deliver to the successor Delaware Trustee all documents and
statements and funds held by it under this Amended and Restated Trust Agreement;
and the Administrator and the predecessor Delaware Trustee shall execute and
deliver such instruments and do such other things as
27
may reasonably be required for fully and certainly vesting and confirming in the
successor Delaware Trustee all such rights, powers, duties and obligations.
Any successor Delaware Trustee appointed under this Amended and Restated
Trust Agreement shall promptly file an amendment to the Amended and Restated
Certificate of Trust with the Secretary of State identifying the name and
principal place of business of such successor Delaware Trustee in the State of
Delaware.
No successor Delaware Trustee shall accept appointment as provided in this
Section 8.3 unless at the time of such acceptance such successor Delaware
Trustee shall be eligible pursuant to Section 8.1.
Upon acceptance of appointment by a successor Delaware Trustee pursuant to
this Section 8.3, the Administrator shall mail notice of such appointment to
each Funding Note Indenture Trustee, each Indenture Trustee and each Rating
Agency then rating the Program or the Notes. If the Administrator shall fail to
mail such notice within ten days after acceptance of appointment by the
successor Delaware Trustee, the successor Delaware Trustee shall cause such
notice to be mailed in the manner aforesaid.
SECTION 8.4 Merger or Consolidation of Delaware Trustee. Any Person into
which the Delaware Trustee may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Delaware Trustee shall be a party, or any Person
succeeding to all or substantially all of the corporate trust business of the
Delaware Trustee, shall, without the execution or filing of any instrument or
any further act on the part of any of the parties to this Amended and Restated
Trust Agreement, anything in this Amended and Restated Trust Agreement to the
contrary notwithstanding, be the successor of the Delaware Trustee under this
Amended and Restated Trust Agreement; provided, such Person shall be eligible
pursuant to Section 8.1.
ARTICLE 9
MISCELLANEOUS PROVISIONS
SECTION 9.1 Limitation on Rights of Others. The death, bankruptcy,
termination, dissolution or incapacity of any Person having an interest,
beneficial or otherwise, in Global Funding shall not operate to terminate this
Amended and Restated Trust Agreement, nor to annul, dissolve or terminate Global
Funding, nor to entitle the legal successors, representatives or heirs of any
such Person, to claim an accounting, take any action or bring any proceeding in
any court for a partition or winding up of the arrangements contemplated by this
Amended and Restated Trust Agreement, nor otherwise affect the rights,
obligations and liabilities of the parties to this Amended and Restated Trust
Agreement or any of them.
SECTION 9.2 Amendments.
28
(a) This Amended and Restated Trust Agreement may be amended from time
to time by the parties by a written instrument executed by each of the
parties, in any way that is not inconsistent with the intent of this
Amended and Restated Trust Agreement, including, without limitation to: (i)
cure any ambiguity, (ii) correct, supplement or modify any provision of
this Amended and Restated Trust Agreement that is inconsistent with another
provision of this Amended and Restated Trust Agreement or (iii) modify,
eliminate or add to any provisions of this Amended and Restated Trust
Agreement to the extent necessary to ensure that Global Funding will, at
all times, for United States Federal income tax purposes be either ignored
or treated as a "grantor trust" or to ensure that Global Funding will not
be required to register as an "investment company" under the Investment
Company Act and no such amendment shall require the consent of any other
Person, except to the extent specified in Sections 9.2(c) and 9.2(d).
(b) So long as any Funding Note remains outstanding, except as
provided in Sections 9.2(c) and 9.2(d), any amendment to this Amended and
Restated Trust Agreement that would adversely affect, in any material
respect, the terms of any Funding Note, other then any amendment of the
type contemplated by clause (iii) of Section 9.2(a), shall require the
prior consent of the Holders or Holders of a majority of the outstanding
principal amount of the Funding Note.
(c) So long as any Funding Note remains outstanding, this Amended and
Restated Trust Agreement may not be amended to (i) change the amount or
timing of any payment of any Funding Note or (ii) impair the right of any
Holder to institute suit for the enforcement of any right for principal and
interest or other distribution without the consent of each affected Holder.
(d) The Delaware Trustee shall not be required to enter into any
amendment to this Amended and Restated Trust Agreement which adversely
affects its own rights, duties or immunities under this Amended and
Restated Trust Agreement.
(e) Prior to the execution of any amendment to this Amended and
Restated Trust Agreement, the Delaware Trustee shall be entitled to an
opinion of counsel as to whether such amendment is permitted by the terms
of this Amended and Restated Trust Agreement and whether all conditions
precedent to such amendment have been met, in each case under the laws of
the State of Delaware.
(f) Promptly after the execution of any such amendment or consent, the
Administrator shall furnish a copy of such amendment or consent (including
those obtained or effected by this Amended and Restated Trust Agreement) to
the Trust Beneficial Owner, the Agents and the Rating Agencies.
29
(g) Contemporaneously with, or promptly after, the execution of any
amendment to this Amended and Restated Trust Agreement requiring amendment
to the Amended and Restated Certificate of Trust, the Delaware Trustee
shall cause the filing of such amendment to the Amended and Restated
Certificate of Trust with the Secretary of State.
(h) Notwithstanding any other provision of this Amended and Restated
Trust Agreement, no amendment to this Amended and Restated Trust Agreement
may be made: (i) if such amendment would cause (A) Global Funding not to be
either ignored or treated as a "grantor trust" for United States Federal
income tax purposes or (B) the Notes to be treated as other than
indebtedness of Allstate Life and (ii) without the prior consent of
Allstate Life.
SECTION 9.3 Notices. All demands, notices, instructions and other
communications shall be in writing (including telecopied or telegraphic
communications) and shall be personally delivered, mailed or transmitted by
telecopy or telegraph, respectively, addressed as set forth below (or, in the
case of any other relevant party, addressed as set forth in a separate notice
delivered to all relevant parties):
If to Delaware Trustee:
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, DE 19890-0001
Attention: Corporate Trust Administration
Facsimile: (302) 636-4140
If to the Trust Beneficial Owner or the Administrator:
AMACAR Pacific Corp.
6525 Morrison Blvd., Suite 318
Charlotte, North Carolina 28211
Attention: Douglas K. Johnson
Facsimile: (704) 365-1632
with a copy to:
Tannenbaum Helpern Syracuse & Hirschtritt LLP
900 3rd Avenue
New York, NY 10022
Attention: Stephen Rosenberg
Facsimile: (212) 937-5279
30
or at such other address as shall be designated by any such party in a written
notice to the other parties. Notwithstanding the foregoing, any notice required
or permitted to be mailed to the Trust Beneficial Owner shall be given by first
class mail, postage prepaid, at AMACAR Pacific Corp., 6525 Morrison Blvd., Suite
318, Charlotte, North Carolina 28211, or at such other address as shall be
designated by the Trust Beneficial Owner in a written notice to the other
parties, and any notices mailed within the time prescribed in this Amended and
Restated Trust Agreement shall be conclusively presumed to have been duly given,
whether or not the Trust Beneficial Owner received such notice. Any notice
required or permitted to be mailed to any Holder of a Funding Note shall be
given as specified in the relevant Funding Note Indenture.
SECTION 9.4 No Recourse. The Trust Beneficial Owner acknowledges that its
beneficial interest in Global Funding does not represent an obligation of
Allstate Life, the Delaware Trustee, the Administrator or any Affiliate of any
of the foregoing and no recourse may be had against such parties or their
assets, except as may be expressly set forth or contemplated in this Amended and
Restated Trust Agreement.
SECTION 9.5 Limited Recourse. Notwithstanding anything to the contrary
contained in this Amended and Restated Trust Agreement, the obligations of
Global Funding under this Amended and Restated Trust Agreement and all Program
Documents and other documents or instruments entered into by Global Funding, are
solely the obligations of Global Funding and shall be payable solely to the
extent of funds received by and available to Global Funding under the Amended
and Restated Support Agreement. No recourse shall be had for the payment of any
amount owing in respect of any obligation of, or claim against, Global Funding
arising out of or based upon this Amended and Restated Trust Agreement, any
Funding Note or any other Program Document against any holder of a beneficial
interest, employee, agent, officer or Affiliate of Global Funding and, except as
specifically provided in this Amended and Restated Trust Agreement and in the
other Program Documents, no recourse shall be had for the payment of any amount
owing in respect of any obligation of, or claim against, Global Funding arising
out of or based upon this Amended and Restated Trust Agreement, any Funding Note
or any other Program Documents against the Delaware Trustee, the Administrator,
Allstate Life, or any of their respective holders of beneficial interests,
employees, agents, officers, directors, incorporators or Affiliates.
SECTION 9.6 No Petition. To the extent permitted by applicable law, each of
the Delaware Trustee, the Administrator and the Trust Beneficial Owner covenants
and agrees that it will not institute against, or join with any other Person in
instituting against, Global Funding any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings, or other proceedings under any applicable
bankruptcy or similar law. This Section 9.6 shall survive termination of this
Amended and Restated Trust Agreement.
31
SECTION 9.7 Governing Law. This Amended and Restated Trust Agreement shall
be governed by, and construed in accordance with, the laws of the State of
Delaware, without regard to its choice of law principles.
SECTION 9.8 Severability. If any provision in this Amended and Restated
Trust Agreement shall be invalid, illegal or unenforceable, such provisions
shall be deemed severable from the remaining provisions of this Amended and
Restated Trust Agreement and shall in no way affect the validity or
enforceability of such other provisions of this Amended and Restated Trust
Agreement.
SECTION 9.9 Third Party Beneficiaries. This Amended and Restated Trust
Agreement shall inure to the benefit of and be binding upon the parties to this
Amended and Restated Trust Agreement and their respective successors and
permitted assigns. Except as otherwise provided in this Amended and Restated
Trust Agreement, no other Person shall have any right or obligation under this
Amended and Restated Trust Agreement.
SECTION 9.10 Counterparts. This Amended and Restated Trust Agreement and
any amendments, supplements, modifications, restatements or replacements of this
Amended and Restated Trust Agreement, or waivers or consents to this Amended and
Restated Trust Agreement, may be executed in any number of counterparts, and by
different parties to this Amended and Restated Trust Agreement in separate
counterparts, each of which, when so executed and delivered, shall be deemed to
be an original and all of which counterparts, when taken together, shall
constitute one and the same instrument. This Amended and Restated Trust
Agreement shall become effective upon the execution of a counterpart to each of
the parties to this Amended and Restated Trust Agreement.
32
IN WITNESS WHEREOF, the parties hereto have caused this Amended and
Restated Trust Agreement to be duly executed by their respective officers
hereunto duly authorized, as of the day and year first above written.
WILMINGTON TRUST COMPANY,
in its individual capacity
By:
---------------------------------------
Name:
Title:
AMACAR PACIFIC CORP.,
as Administrator
By:
---------------------------------------
Name: Douglas K. Johnson
Title: President
AMACAR PACIFIC CORP.,
as Trust Beneficial Owner
By:
----------------------------------------
Name: Douglas K. Johnson
Title: President
33
EXHIBIT 4.2
===============================================================================
STANDARD TRUST AGREEMENT TERMS
with respect to
ALLSTATE LIFE GLOBAL FUNDING TRUSTS
===============================================================================
TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS
SECTION 1.1 Definitions....................................................................1
SECTION 1.2 Other Definitional Provisions..................................................7
ARTICLE 2
CREATION OF TRUST
SECTION 2.1 Name of the Trust..............................................................7
SECTION 2.2 Office of the Delaware Trustee; Principal Place of Business....................8
SECTION 2.3 Statutory Trust................................................................8
SECTION 2.4 Trust Beneficial Owner.........................................................8
SECTION 2.5 Purposes of the Trust..........................................................8
SECTION 2.6 Allocation of Trust Expenses...................................................9
SECTION 2.7 Liability......................................................................9
SECTION 2.8 Income Tax Treatment...........................................................9
SECTION 2.9 Situs of Trust.................................................................9
ARTICLE 3
PAYMENT ACCOUNT
SECTION 3.1 Payment Account...............................................................10
ARTICLE 4
NOTES; COLLATERAL
SECTION 4.1 Issuance of Notes.............................................................11
SECTION 4.2 Acquisition of Funding Note And Funding Agreements............................11
SECTION 4.3 Security Interest in the Collateral...........................................11
ARTICLE 5
REPRESENTATIONS AND WARRANTIES BY THE DELAWARE TRUSTEE
ARTICLE 6
DELAWARE TRUSTEE
SECTION 6.1 General Authority.............................................................13
SECTION 6.2 General Duties................................................................19
SECTION 6.3 Specific Duties...............................................................20
SECTION 6.4 Acceptance of Trust and Duties; Limitation on Liability.......................20
i
SECTION 6.5 Reliance; Advice of Counsel...................................................25
SECTION 6.6 Delegation of Authorities and Duties..........................................25
SECTION 6.7 Indemnification...............................................................25
ARTICLE 7
TERMINATION OF AGREEMENT; DISSOLUTION OF THE TRUST
SECTION 7.1 Termination of Agreement......................................................26
ARTICLE 8
SUCCESSOR AND ADDITIONAL DELAWARE TRUSTEES
SECTION 8.1 Eligibility Requirements for the Delaware Trustee.............................27
SECTION 8.2 Resignation or Removal of the Delaware Trustee................................28
SECTION 8.3 Successor Delaware Trustee....................................................29
SECTION 8.4 Merger or Consolidation of Delaware Trustee...................................30
SECTION 8.5 Appointment of Co-Delaware Trustee or Separate Delaware Trustee..............30
SECTION 8.6 Delaware Trustee May Own Notes................................................32
ARTICLE 9
MISCELLANEOUS PROVISIONS
SECTION 9.1 Limitation on Rights of Others................................................33
SECTION 9.2 Amendments....................................................................33
SECTION 9.3 Notices.......................................................................34
SECTION 9.4 No Recourse to Certain Persons................................................36
SECTION 9.5 Limited Recourse..............................................................36
SECTION 9.6 No Petition...................................................................37
SECTION 9.7 Governing Law.................................................................37
SECTION 9.8 Severability..................................................................37
SECTION 9.9 No Third Party Beneficiaries..................................................37
SECTION 9.10 Counterparts..................................................................37
ii
This document constitutes the Standard Trust Agreement Terms, which will be
incorporated by reference in, and form a part of, the Trust Agreement (as
defined below) among the Delaware Trustee (as defined below), the Administrator
(as defined below) and Allstate Life Global Funding, a statutory trust formed
under the laws of the State of Delaware, as the sole beneficial owner of the
Trust (the "Trust Beneficial Owner").
These Standard Trust Agreement Terms shall not in and of itself create a
trust and shall be of no force and effect unless and until incorporated by
reference in, and then only to the extent not modified by, the Trust Agreement.
The following terms and provisions shall govern the activities of the
Trust, subject to contrary terms and provisions expressly adopted in the Trust
Agreement, which contrary terms shall be controlling.
ARTICLE 1
DEFINITIONS
SECTION 1.1 Definitions. The following terms have the meanings set forth
below:
"Administrative Services Agreement" means that certain Administrative
Services Agreement, included in Part B of the Series Instrument, between the
Administrator and the Trust, as the same may be amended, supplemented, modified,
restated or replaced from time to time.
"Additional Amounts" has the meaning ascribed in the Indenture.
"Administrator" means the party named as such in the Trust Agreement, in
its capacity as the sole administrator of the Trust pursuant to the
Administrative Services Agreement, and its successors.
"Affiliate" means, as applied to any Person, any other Person directly or
indirectly controlling, controlled by or under common control with, that Person
and, in the case of an individual, any spouse or other member of that
individual's immediate family. For the purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of that Person, whether through the
ownership of voting securities, by contract or otherwise.
"Agents" has the meaning ascribed in the Distribution Agreement.
"Allstate Life" means Allstate Life Insurance Company, a stock life
insurance company organized and licensed under the laws of the State of
Illinois, and any successor.
1
"Business Day" has the meaning ascribed in the Indenture.
"Calculation Agent" has the meaning ascribed in the Indenture.
"Certificate of Trust" means the Certificate of Trust of the Trust as filed
with the Secretary of State of the State of Delaware.
"Closing Instrument" means the Closing Instrument of the Trust, pursuant to
which certain documents are executed in connection with the issuance of the
Notes by the Trust.
"Code" means the Internal Revenue Code of 1986, as amended, including any
successor or amendatory statutes and any applicable rules, regulations, notices
or orders promulgated thereunder.
"Collateral" has the meaning ascribed in the Indenture.
"Commission" means the Securities and Exchange Commission or any successor
body.
"Coordination Agreement" means that certain Coordination Agreement included
in Part F of the Series Instrument, among the Trust and the other parties
specified therein, as the same may be amended, supplemented, modified, restated
or replaced from time to time.
"Corporate Trust Office" means the principal office of the Delaware Trustee
located at Rodney Square North, 1100 North Market Street, Wilmington, Delaware
19890-0001 or at such other address as may be specified by the Delaware Trustee
in the Trust Agreement or in a written notice provided in accordance with
Section 9.3.
"Debt" of any Person means, at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of
business, all obligations of such Person as lessee which are capitalized in
accordance with generally accepted accounting principles, (iv) all contingent
and non-contingent obligations of such Person to reimburse any bank or other
Person in respect of amounts paid under a letter of credit or similar
instrument, (v) all Debt secured by a Lien on any asset of such Person, whether
or not such Debt is otherwise an obligation of such Person, and (vi) all
Guarantees by such Person of Debt of another Person (each such Guarantee to
constitute Debt in an amount equal to the amount of such other Person's Debt
Guaranteed thereby).
"Delaware Statutory Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. Section 3801, et seq., as amended from time to time.
2
"Delaware Trustee" means the party named as such in the Trust Agreement, in
its capacity as the sole Delaware trustee of the Trust, and its successors. If
there shall be at any time more than one Delaware Trustee under the Trust
Agreement, "Delaware Trustee" shall mean each such Delaware Trustee.
"Distribution Agreement" means that certain Distribution Agreement dated -,
2006 by and among Global Funding and the Agents named therein, as the same may
be amended, supplemented, modified, restated or replaced from time to time.
"DTC" means The Depository Trust Company and its successors and assigns.
"Funding Agreement" means, with respect to any Trust, each funding
agreement issued by Allstate Life to Global Funding, which is immediately
pledged and collaterally assigned by Global Funding to the Funding Note
Indenture Trustee and immediately thereafter assigned absolutely to, and
deposited into, the Trust by Global Funding, as the same may be amended,
supplemented, modified, restated or replaced from time to time in accordance
with the terms thereof.
"Funding Agreement Event of Default" means an "Event of Default" as defined
in the applicable Funding Agreement.
"Funding Note" has the meaning ascribed in the Funding Note Indenture.
"Funding Note Indenture" means that certain Funding Note Indenture included
in Part H of the Series Instrument for the Trust, among Global Funding and the
other parties specified therein, as the same may be amended, supplemented,
modified, restated or replaced from time to time.
"Funding Note Indenture Trustee" means the party named as such in the
Funding Note Indenture, and, subject to the applicable provisions of the Funding
Note Indenture, its successors.
"Global Funding" means Allstate Life Global Funding, a statutory trust
formed under the laws of the State of Delaware.
"Guarantee" by any Person means any obligation, contingent or otherwise, of
such Person directly or indirectly guaranteeing any Debt of any other Person
and, without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Debt (whether
arising by virtue of partnership arrangements, by virtue of an agreement to
keep-well, to purchase assets, goods, securities or services, to take-or-pay, or
to maintain financial statement conditions or otherwise), (ii) to reimburse a
bank for amounts drawn under a letter of credit for the purpose of paying such
Debt or (iii) entered into for the purpose of assuring in any other manner the
holder of such Debt of the payment thereof or to protect such holder against
loss in respect thereof (in whole or in part); provided that the term
3
"Guarantee" shall not include endorsements for collection or deposit in the
ordinary course of business.
"Holder" has the meaning ascribed in the Indenture.
"Indemnified Person" has the meaning ascribed in Section 6.7.
"Indenture" means that certain Indenture included in Part G of the Series
Instrument, among the Trust and the other parties specified therein, as the same
may be amended, supplemented, modified, restated or replaced from time to time.
"Indenture Trustee" means the party named as such in the Indenture, and,
subject to the applicable provisions of the Indenture, its successors.
"Investment Company Act" means the Investment Company Act of 1940, as
amended, and any successor statute thereto, and the rules, regulations and
published interpretations of the Commission promulgated thereunder from time to
time.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind, or any other type of
preferential arrangement that has substantially the same practical effect as a
security interest, in respect of such asset. For purposes hereof, the Trust
shall be deemed to own subject to a Lien any asset which it has acquired or
holds subject to the interest of a vendor or lessor under any conditional sale
agreement, capital lease or other title retention agreement relating to such
asset.
"Moody's" means Moody's Investors Service, Inc.
"Name Licensing Agreement" means that certain Name Licensing Agreement
included in Part D of the Series Instrument, between Allstate Insurance Company
and the Trust, as the same may be amended, supplemented, modified, restated or
replaced from time to time.
"Notes" has the meaning set forth in the Indenture.
"Note Certificate" has the meaning set forth in the Indenture.
"Obligations" means the obligations of the Trust secured under the Notes
and the Indenture, including (a) all principal of, any premium and interest
(including, without limitation, any interest which accrues after the
commencement of any case, proceeding or other action relating to the bankruptcy,
insolvency or reorganization of the Trust, whether or not allowed or allowable
as a claim in any such proceeding) on, and any Additional Amounts with respect
to, the Notes or pursuant to the Indenture, (b) all other amounts payable by the
Trust under the Indenture or under the Notes including all costs and expenses
(including attorneys' fees) incurred by the Indenture Trustee or any Holder
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thereof in realizing on the Collateral to satisfy such obligations and (c) any
renewals or extensions of the foregoing.
"Original Issue Date" has the meaning ascribed in the Pricing Supplement.
"Paying Agent" has the meaning ascribed in the Indenture.
"Payment Account" means the segregated non-interest-bearing corporate trust
account for the Trust maintained by the Delaware Trustee or by another financial
institution designated by the Delaware Trustee, which shall be controlled by the
Delaware Trustee; provided that the rating of the entity maintaining such
account shall be at least equal to the rating of the Notes by Moody's and
Standard & Poor's, in which all amounts paid to the Delaware Trustee in respect
of the Notes or any Collateral related thereto will be held and from which the
Delaware Trustee shall make any payments pursuant to Section 3.1(b) and Article
7 of these Standard Trust Agreement Terms, to the extent such amounts are paid
to the Delaware Trustee and deposited in the applicable Payment Account.
"Person" means any natural person, corporation, limited partnership,
general partnership, joint stock company, joint venture, association, company,
limited liability company, trust (including any beneficiary thereof), bank,
trust company, land trust, business trust, statutory trust or other
organization, whether or not a legal entity, and governments and agencies and
political subdivisions thereof.
"Pricing Supplement" means the pricing supplement attached to the Series
Instrument as Annex A, as prepared by the Trust in connection with the issuance
of the Notes.
"Program" has the meaning ascribed in the Indenture.
"Program Documents" means each Note, the Series Instrument, the Closing
Instrument, the Indenture, the Trust Agreement, the Administrative Services
Agreement, the Support Agreement, the Name Licensing Agreement, the Distribution
Agreement, the Terms Agreement, each Funding Agreement and any other documents,
certificates, agreements or instruments entered into by, or with respect to, or
on behalf of, the Trust.
"Rating Agency" means each of Moody's, S&P and any other rating agency
which provides a rating of any Notes.
"Registrar" has the meaning ascribed in the Indenture.
"Responsible Officer" means any vice president, assistant vice president,
any assistant secretary, any assistant treasurer, any trust officer or assistant
trust officer, or any other officer of the Delaware Trustee, as the case may be,
customarily performing functions similar to those performed by any of the above
designated officers and also, with respect to a particular corporate trust
5
matter, any other officer to whom such matter is referred because of his or her
knowledge of and familiarity with the particular subject.
"S&P" means Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc.
"Secretary of State" means the Secretary of State of the State of Delaware.
"Securities Act" means the Securities Act of 1933, as amended, and any
successor statute thereto, and the rules, regulations and published
interpretations of the Commission promulgated thereunder from time to time.
"Security Interest" has the meaning ascribed in the Indenture.
"Series Instrument" means the Series Instrument of the Trust, pursuant to
which the Administrative Services Agreement, the Coordination Agreement, the
Funding Note Indenture, the Indenture, the Name Licensing Agreement, the Support
Agreement, the Terms Agreement and the Trust Agreement are entered into, and
certain other documents are executed, in connection with the issuance of the
Notes by the Trust.
"Standard Trust Agreement Terms" means these Standard Trust Agreement
Terms.
"Standing Order" has the meaning ascribed in Section 3.1(d).
"Supplemental Indenture" has the meaning set forth in the Indenture.
"Support Agreement" means that certain Support and Expenses Agreement
included in Part C of the Series Instrument, by and between Allstate Life and
the Trust, as the same may be amended, supplemented, modified, restated or
replaced from time to time.
"Terms Agreement" means that certain Terms Agreement included in Part E of
the Series Instrument, by and among Global Funding, the Trust and each Agent
named therein, which will incorporate by reference the terms of the Distribution
Agreement.
"Trust" means the Allstate Life Global Funding Trust specified in the
Series Instrument, together with its permitted successors and assigns.
"Trust Agreement" means that certain Trust Agreement included in Part A of
the Series Instrument, and which incorporates by reference these Standard Trust
Agreement Terms, as the same may be amended, supplemented, modified, restated or
replaced from time to time.
"Trust Beneficial Owner" means the party named as such in the Trust
Agreement, in its capacity as the sole beneficial owner of the Trust, and its
successors.
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"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended,
and any successor statute thereto, and the rules, regulations and published
interpretations of the Commission promulgated thereunder from time to time.
"UCC" means the Uniform Commercial Code, as from time to time in effect in
the State of New York; provided that, with respect to the perfection, effect of
perfection or non-perfection, or priority of any security interest in the
Collateral, "UCC" shall mean the applicable jurisdiction whose law governs such
perfection, non-perfection or priority.
SECTION 1.2 Other Definitional Provisions. For all purposes of the Trust
Agreement except as otherwise expressly provided or unless the context otherwise
requires:
(a) the terms defined in this Article shall have the meanings
ascribed to them in this Article and shall include the plural as
well as the singular;
(b) all accounting terms not otherwise defined in the Trust Agreement
have the meanings assigned to them in accordance with generally
accepted accounting principles in the United States and, except
as otherwise expressly provided in the Trust Agreement, the term
"generally accepted accounting principles" with respect to any
computation required or permitted under the Trust Agreement shall
mean such accounting principles as are generally accepted at the
date of such computation in the United States;
(c) the words "include", "includes" and "including" shall be
construed to be followed by the words "without limitation";
(d) Article and Section headings are for the convenience of the
reader and shall not be considered in interpreting the Trust
Agreement or the intent of the parties to the Trust Agreement;
and
(e) capitalized terms not otherwise defined in the Trust Agreement
will have the respective meanings set forth in the Indenture.
ARTICLE 2
CREATION OF TRUST
SECTION 2.1 Name of the Trust. The Trust created under the Trust Agreement
shall have the name specified in or pursuant to the Series Instrument. The
Trust's activities shall be conducted under the name of the Trust.
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SECTION 2.2 Office of the Delaware Trustee; Principal Place of Business.
The principal office of the Trust shall be in care of the Delaware Trustee at
the Corporate Trust Office, or such other address in the State of Delaware as
the Delaware Trustee may designate by written notice to the Trust Beneficial
Owner, the Indenture Trustee, the Administrator and the Rating Agencies. The
Trust shall also maintain an office in care of the Administrator at:
c/o AMACAR Pacific Corp.
6525 Morrison Boulevard, Suite 318
Charlotte, North Carolina 28211
Attention: President
or at such other address as the Administrator may designate by written notice to
the Trust Beneficial Owner, the Indenture Trustee, the Delaware Trustee and the
Rating Agencies.
SECTION 2.3 Statutory Trust. It is the intention of the parties that the
Trust constitute a statutory trust organized under the Delaware Statutory Trust
Act and that the Trust Agreement constitute the governing instrument of the
Trust. Pursuant to Section 3810 of the Delaware Statutory Trust Act, on or
before the date of the Trust Agreement, the Delaware Trustee shall file a
Certificate of Trust with the Secretary of State to form the Trust. The parties
to the Trust Agreement hereby appoint the Delaware Trustee as trustee of the
Trust, to have all rights, powers and duties set forth in the Trust Agreement
and in accordance with the applicable law, subject to modification by the Trust
Agreement, with respect to accomplishing the purposes of the Trust.
SECTION 2.4 Trust Beneficial Owner. The Trust Beneficial Owner shall not be
required to make any deposit, perform any service or otherwise provide any
consideration in exchange for its beneficial interest in the Trust. The
beneficial interest of the Trust Beneficial Owner in the Trust will not be
represented by any certificate or other instrument. Upon the creation of the
Trust, the Trust Beneficial Owner shall be the beneficial owner of the Trust and
shall have an undivided beneficial ownership interest in the property related to
the Trust. To the fullest extent permitted by law, any attempted transfer of the
Trust Beneficial Owner's interest in the Trust shall be void.
SECTION 2.5 Purposes of the Trust. The exclusive purposes and functions of
the Trust are, and the Trust shall have the power and authority, to:
(a) issue and sell the Notes,
(b) use the net proceeds from the sale of the Notes to acquire the
Funding Note,
(c) receive one or more Funding Agreements from Global Funding
pursuant to the terms of the Funding Note,
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(d) grant a security interest in, and pledge and collaterally assign,
the rights, title and interest of the Trust in the Collateral to
the Indenture Trustee for the benefit of the Holders of the Notes
and any other Person for whose benefit the Indenture Trustee is
or will be holding the Collateral,
(e) make, or cause to be made, all payments due in respect of the
Notes, in accordance with the terms of the Indenture, and
(f) engage in other activities and enter into other agreements, in
each case that are necessary, suitable or convenient to
accomplish the foregoing or are incidental to or connected with
those activities, including the execution, delivery and
performance of the Series Instrument, the Closing Instrument and
the Program Documents to which it is a signatory.
SECTION 2.6 Allocation of Trust Expenses. Any costs and expenses of the
Trust shall be paid by Allstate Life pursuant to the Support Agreement to the
extent provided therein.
SECTION 2.7 Liability. None of the Delaware Trustee, the Administrator, the
Trust Beneficial Owner or the Holders shall have any personal liability for any
liability or obligation of the Trust.
SECTION 2.8 Income Tax Treatment. The parties agree, and each Holder and
beneficial owner of Notes by purchasing the Notes agrees, for all United States
Federal, state and local income and franchise tax purposes (i) to treat the
Notes as indebtedness of Allstate Life, (ii) that Global Funding and the Trust
will be ignored and will not be treated as an association or a publicly traded
partnership taxable as a corporation and (iii) to not take any action
inconsistent with the treatment described in (i) and (ii) unless otherwise
required by law.
SECTION 2.9 Situs of Trust. The Trust shall be located in the State of
Delaware. The Trust shall have the right, upon consent of the Indenture Trustee,
and under certain circumstances set forth in the Indenture, to change its
domicile from Delaware to any other jurisdiction. All bank accounts maintained
by the Delaware Trustee on behalf of the Trust shall be located in the State of
Delaware except that those accounts established under the Indenture shall be
maintained with the Indenture Trustee in accordance with the Indenture. The
Trust shall not have any employees in any state other than in the State of
Delaware.
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ARTICLE 3
PAYMENT ACCOUNT
SECTION 3.1 Payment Account.
(a) On the Original Issue Date, the Delaware Trustee shall establish
the Payment Account. The Delaware Trustee and any agent of the
Delaware Trustee shall have exclusive control and sole right of
withdrawal with respect to the Payment Account for the purpose of
making deposits in and withdrawals from the Payment Account in
accordance with the Trust Agreement and the Indenture. Subject to
the Indenture, all funds or other property received by the
Delaware Trustee on behalf of the Trust in respect of the
Collateral will be deposited in the Payment Account. All funds
and other property deposited or held from time to time in the
Payment Account shall be held by the Delaware Trustee in the
Payment Account for the exclusive benefit of the Trust Beneficial
Owner, subject to the security interest in the Collateral in
favor of the Indenture Trustee on behalf of the Holders of the
Notes and any other Person for whose benefit the Indenture
Trustee is or will be holding the Collateral, and for
distribution by the Delaware Trustee as provided in the Trust
Agreement, including (and subject to) any priority of payments
provided for in the Trust Agreement.
(b) All funds and other property deposited into the Payment Account
shall be distributed by the Trust as follows:
First, to the Indenture Trustee for the payment of all amounts
then due and unpaid upon the Notes and any other amounts due and
payable in accordance with the Indenture; and
Second, upon the final redemption of the Notes and payment of any
amounts payable in respect thereof, any remaining funds and other
property deposited into the Payment Account shall be distributed to
the Delaware Trustee for distribution pursuant to Section 7.1.
(c) The Delaware Trustee shall deposit in the Payment Account,
promptly upon receipt, any payments received with respect to the
Collateral. Amounts held in the Payment Account shall not be
invested by the Delaware Trustee.
(d) Notwithstanding anything in the Trust Agreement to the contrary,
the Delaware Trustee, on behalf of the Trust, shall execute a
standing order (the "Standing Order") to the Indenture Trustee
10
pursuant to which the Indenture Trustee, either directly or
through a Paying Agent, shall distribute all amounts due and
unpaid under Section 3.1(b); provided, however, that all payments
to be made pursuant to Section 7.1 shall be made by the Delaware
Trustee on behalf of the Trust. For so long as (i) the Delaware
Trustee, on behalf of the Trust, has not rescinded the Standing
Order and (ii) the Indenture Trustee, either directly or through
a Paying Agent, is able to, and does, comply with the Standing
Order, the Delaware Trustee will not be required to establish a
separate Payment Account in accordance with Section 3.1;
provided, however, that the Delaware Trustee shall establish a
separate payment account to facilitate payments made pursuant to
Section 7.1.
ARTICLE 4
NOTES; COLLATERAL
SECTION 4.1 Issuance of Notes. The Trust shall, in accordance with the
Indenture, issue and deliver or cause to be issued and delivered the aggregate
principal amount of the Notes specified in the Pricing Supplement against
payment therefor. The Holders of the Notes shall only have a right to receive
payments from the Collateral as described in the Indenture and shall have no
right to receive payments from the assets of Global Funding or the assets held
in any other trust organized under the Program.
SECTION 4.2 Acquisition of Funding Note And Funding Agreements. In
connection with the issuance and sale of the Notes, pursuant to Articles 2 and 3
of the Coordination Agreement: (i) the Trust will use the net proceeds received
from the offering of Notes to purchase the Funding Note from Global Funding;
(ii) Global Funding will use the net proceeds received from the sale of the
Funding Note to purchase one or more Funding Agreements; and (iii) Global
Funding will assign absolutely to, and deposit into, the Trust each such Funding
Agreement, and the relevant Funding Note will be surrendered pursuant to the
terms of the Funding Note and cancelled by Global Funding immediately upon such
surrender. Such cancellation shall operate as a redemption and satisfaction of
the Funding Note.
SECTION 4.3 Security Interest in the Collateral. Simultaneously with the
issuance and sale of the Notes, pursuant to the Indenture, the Trust shall
pledge and collaterally assign to the Indenture Trustee, and will grant to the
Indenture Trustee, for the benefit of the Holders of the Notes and any other
Person for whose benefit the Indenture Trustee is or will be holding the
Collateral, a security interest in and to the Collateral, including, without
limitation, each Funding Agreement purchased by the Trust.
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ARTICLE 5
REPRESENTATIONS AND WARRANTIES BY THE DELAWARE TRUSTEE
The Delaware Trustee represents and warrants for the benefit of the Holders
and the Trust Beneficial Owner as follows:
(a) it is a banking corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware and it
is a "bank" within the meaning of Section 581 of the Code;
(b) it is a "United States person" within the meaning of Section
7701(a)(30) of the Code;
(c) it has full corporate or other power, authority and legal right
to execute, deliver and perform its obligations under the Trust
Agreement and has taken all necessary action to authorize the
execution, delivery and performance by it of the Trust Agreement;
(d) the Trust Agreement has been duly authorized, executed and
delivered by it and constitutes the valid and legally binding
agreement of it enforceable against it in accordance with its
terms;
(e) neither the execution or delivery by it of the Trust Agreement,
nor the performance by it of its obligations under the Trust
Agreement, will (i) violate its organizational documents, (ii)
violate any provision of, or constitute, with or without notice
or lapse of time, a default under, or result in the creation or
imposition of any Lien on any properties or assets held in the
Trust pursuant to the provisions of, any indenture, mortgage,
credit agreement, license or other contract, agreement, judgment,
order or instrument to which it is a party or by which it is
bound, or (iii) violate any law, governmental rule or regulation
of the State of Delaware or the United States governing the
banking, trust or general powers of it or any order, judgment or
decree applicable to it;
(f) the authorization, execution or delivery by it of the Trust
Agreement and the consummation of any of the transactions by it
contemplated by the Trust Agreement do not require the consent or
approval of, the giving of notice to, the registration with or
the taking of any other action with respect to any governmental
authority or agency (other than the filing of the Certificate of
Trust with the Secretary of State); and
12
(g) there are no proceedings pending or, to the best of its
knowledge, threatened against or affecting it in any court or
before any governmental authority, agency or arbitration board or
tribunal which, individually or in the aggregate, would
materially and adversely affect the Trust or would question the
right, power and authority of it to enter into or perform its
obligations under the Trust Agreement.
ARTICLE 6
DELAWARE TRUSTEE
SECTION 6.1 General Authority.
(a) The Delaware Trustee is authorized and empowered, among other
things, to (a) execute and deliver on behalf of the Trust the
Program Documents and each certificate or other document attached
as an exhibit to, or contemplated by, the Program Documents and
any amendment or other agreement to any of the Program Documents,
(b) take all actions required of the Trust pursuant to the
Program Documents including, but not limited to (i) paying, or
causing to be paid, on behalf of the Trust any amounts due and
owing by the Trust under the Program Documents or any other
documents or instruments to which the Trust is a party, (ii)
providing certificates required under the Program Documents or
other documents or instruments to which the Trust is a party and
(iii) preparing for execution or executing amendments to and
waivers under the Program Documents or any other documents or
instruments deliverable by the Trust thereunder or in connection
therewith or with the Trust Agreement, (c) cause the Trust to
perform under the Program Documents and (d) engage in those
activities, including entering into agreements, that are
necessary, suitable or convenient to accomplish the foregoing or
any other of the purposes of the Trust or are incidental thereto
or connected therewith including, from time to time, taking such
action on behalf of the Trust as is permitted by the Program
Documents. In addition to any other duties under the Trust
Agreement, the Delaware Trustee shall be the trustee of the Trust
for the purpose of fulfilling the requirements of Section 3807 of
the Delaware Statutory Trust Act. Subject to the limitations set
forth in Section 6.1(b), the Delaware Trustee shall have the
power and authority to act on behalf of the Trust, with respect
to the following matters:
(i) to execute and deliver on behalf of the Trust the Notes in
accordance with the Trust Agreement and the Indenture;
13
(ii) to cause the Trust to perform the Trust Agreement and to
enter into, and to execute, deliver and perform on behalf of
the Trust, the documents contained in the Series Instrument
and the Closing Instrument, the Distribution Agreement, the
Notes, each Funding Agreement and such other certificates,
other documents or agreements as may be necessary,
contemplated by or desirable in connection with the purposes
and function of the Trust or any of the above-referenced
documents;
(iii) subject to the applicable provisions of the Indenture, to
receive and maintain custody of each Funding Agreement and
to exercise all of the rights, powers and privileges of an
owner or policyholder of each Funding Agreement;
(iv) to grant to the Indenture Trustee a security interest in the
Collateral and to pledge and collaterally assign the rights,
title and interest of the Trust in the Collateral to the
Indenture Trustee for the benefit of the Holders of Notes
and any other Person on whose behalf the Indenture Trustee
is or will be holding the Collateral, and to seek release of
such security interest upon payment in full of all amounts
required to be paid with respect to the Notes pursuant to
the terms and conditions of the Notes and the Indenture;
(v) to establish the Payment Account;
(vi) to send notices regarding the Notes and the Funding
Agreement(s) to Allstate Life, the Indenture Trustee, the
Rating Agencies, the Trust Beneficial Owner, the applicable
Agent(s) and any other Person entitled thereto, in
accordance with the terms of the Notes, the Indenture, each
Funding Agreement and the Trust Agreement;
(vii) to take all actions necessary or appropriate to enable the
Trust to comply with Section 2.8 regarding income tax
treatment;
(viii) after the occurrence of a Funding Agreement Event of
Default actually known to a Responsible Officer, subject to
the applicable provisions of the Indenture, to take any
action as it may from time to time determine (based solely
upon the advice of counsel) is necessary or advisable to
give effect to the terms of the Trust Agreement and to
14
protect and conserve the Collateral for the benefit of the
Holders of Notes and any other Person for whose benefit the
Indenture Trustee is or will be holding the Collateral and,
within five Business Days after the occurrence of a Funding
Agreement Event of Default actually known to a Responsible
Officer, to give notice thereof to the Administrator, the
Trust Beneficial Owner and the Indenture Trustee;
(ix) to the extent permitted by the Trust Agreement, to
participate in the winding up of the affairs of and
liquidation of the Trust and assist with the preparation,
execution and filing of a certificate of cancellation with
the Secretary of State;
(x) subject to the applicable provisions of the Indenture, to
take any action and to execute any documents on behalf of
the Trust, incidental to the foregoing as the Delaware
Trustee may from time to time determine (based on the advice
of counsel) is necessary or advisable to give effect to the
terms of the Trust Agreement;
(xi) to execute and file documents with the Secretary of State;
and
(xii) to accept service of process on behalf of the Trust in the
State of Delaware.
It is expressly understood and agreed that the Delaware Trustee shall be
entitled to engage outside counsel, independent accountants and other experts
appointed with due care to assist the Delaware Trustee in connection with the
performance of its duties and powers set forth in this Section 6.1(a),
including, without limitation, certificates, reports, opinions, notices or any
other documents. The Delaware Trustee shall be entitled to rely conclusively on
the advice of such counsel, accountants and other experts in the performance of
all its duties under the Trust Agreement and shall have no liability for any
documents prepared by such counsel, accountants or experts or any action or
inaction taken pursuant to the advice of such counsel, accountants or experts.
Any expenses of such counsel, accountants and experts shall be paid by the
Trust.
(b) So long as the Trust Agreement remains in effect, the Trust (and
the Delaware Trustee and the Administrator acting on behalf of
the Trust) shall not undertake any business, activity or
transaction except as expressly provided for or contemplated by
the Trust Agreement or the Indenture. In particular, the Trust
shall not, except as otherwise contemplated by the Trust
15
Agreement or the Indenture:
(i) sell, transfer, exchange, assign, lease, convey or otherwise
dispose of any assets held in the Trust (as of the date of
the Trust Agreement or thereafter acquired), including,
without limitation, any portion of the Collateral;
(ii) engage in any business or activity other than in connection
with, or relating to, (A) the performance of the Trust
Agreement and the execution, delivery and performance of any
documents, including the Program Documents (other than the
Trust Agreement as set forth above), relating to the Notes
and the transactions contemplated thereby, (B) the issuance
of the Notes pursuant to the Indenture and (C) any
activities, including entering into agreements, that are
necessary, suitable or convenient to accomplish the purposes
of the Trust specified in Section 2.5;
(iii) incur, directly or indirectly, any Debt except for the
Notes;
(iv) amend, modify or fail to comply with any material provision
of the Trust Agreement, except for any amendment or
modification of the Trust Agreement expressly permitted
under the Trust Agreement or under the Indenture or the
Funding Agreement(s);
(v) own any subsidiary or lend or advance any funds to, or make
any investment in, any Person, except for an investment in
the Funding Agreement(s), the Funding Note or the investment
of any funds of the Trust held by the Indenture Trustee, a
Paying Agent, the Registrar, the Delaware Trustee or the
Administrator as provided in (or in the documents or
agreements contained in) the Series Instrument or the
Closing Instrument, or in any Funding Agreement;
(vi) directly or indirectly declare or pay a distribution or make
any distribution or other payment, or redeem or otherwise
acquire or retire for value any securities other than the
Notes, provided that the Trust may declare or pay a
distribution or make any distribution or other payment to
the Trust Beneficial Owner in compliance with the Trust
Agreement if the Trust has paid or made provision for the
16
payment of all amounts due to be paid on the Notes, and pay
all of its debt, liabilities, obligations and expenses, the
payment of which is provided for under the Support
Agreement;
(vii) become required to register as an "investment company"
under and as such term is defined in the Investment Company
Act;
(viii) enter into any transaction of merger or consolidation or
liquidate or dissolve itself (or, to the fullest extent
permitted by law, suffer any liquidation or dissolution), or
acquire by purchase or otherwise all or substantially all
the business or assets of, or any stock or other evidence of
beneficial ownership of, any Person;
(ix) take any action that would cause the Trust not to be either
ignored or treated as a "grantor trust" for United States
Federal income tax purposes;
(x) have any employees other than the Delaware Trustee, the
Administrator and any other Persons necessary to conduct its
business and enter into transactions contemplated under the
Program Documents;
(xi) have an interest in any bank account other than (A) those
accounts contemplated by the Program Documents, and (B)
those accounts expressly permitted by the Indenture Trustee;
provided that any such further account or such interest of
the Trust therein shall be charged or otherwise secured in
favor of the Indenture Trustee on terms acceptable to the
Indenture Trustee;
(xii) permit any Affiliate, employee or officer of Allstate Life
or any agent of Allstate Life or Agent to be a trustee of
the Trust;
(xiii) issue any Notes unless Allstate Life has affirmed in
writing to the Trust that it has made changes to its books
and records to reflect the grant of a security interest in,
and the making of an assignment for collateral purposes of,
the relevant Funding Agreement(s) by the Trust to the
Indenture Trustee in accordance with the terms of such
Funding Agreement(s) and the Trust has taken such other
steps as may be necessary to cause the Security Interest in
17
or assignment for all collateral purposes of, the Collateral
to be perfected for purposes of the UCC or effective against
its creditors and subsequent purchasers of the Collateral
pursuant to insurance or other state laws;
(xiv) make any deduction or withholding from any payment of
principal of or interest on the Notes (other than amounts
that may be required to be withheld or deducted from such
payments under the Code or any other applicable tax law) by
reason of the payment of any taxes levied or assessed upon
any portion of the Collateral except to the extent specified
in the Indenture or a Note Certificate or Supplemental
Indenture;
(xv) commingle any of its assets with assets of any of the
Trust's Affiliates, or guarantee any obligation of any of
the Trust's Affiliates; or
(xvi) (A) permit the validity or effectiveness of the Indenture
or the Security Interest securing the Notes to be impaired,
or permit such Security Interest to be amended,
hypothecated, subordinated, terminated or discharged, (B)
permit any Person to be released from any covenants or
obligations under any Funding Agreement, except as expressly
permitted thereunder, under the Indenture, the Trust
Agreement, or any Funding Agreement, (C) create, incur,
assume, or permit any Lien or other encumbrance (other than
the Security Interest) on any of its properties or assets,
or any interest therein or the proceeds thereof, or (D)
permit a Lien with respect to the Collateral not to
constitute a valid first priority perfected security
interest in the Collateral.
(c) Notwithstanding any other provision of the Trust Agreement, the
Delaware Trustee and the Administrator, acting on behalf of the
Trust, shall not take any action that would cause the Trust not
to be either ignored or treated as a "grantor trust" for United
States Federal income tax purposes.
(d) The Delaware Trustee shall, based on the advice of counsel,
defend against all claims and demands of all Persons at any time
claiming any Lien on any of the assets of the Trust adverse to
the interest of the Trust or any Holder, other than the Security
Interest in the Collateral granted in favor of the Indenture
Trustee for the benefit of each Holder of the Notes and any other
Person
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for whose benefit the Indenture Trustee is or will be holding the
Collateral.
(e) If and for so long as any Funding Agreement is held by the
Delaware Trustee for the benefit of the Trust, the Delaware
Trustee shall not (i) waive any default under any Funding
Agreement or (ii) consent to any amendment, modification or
termination of any Funding Agreement, without, in each case,
obtaining the prior approval of the Indenture Trustee in
accordance with the Indenture and an opinion of counsel
experienced in such matters to the effect that any such action
shall not cause the Trust not to be either ignored or treated as
a "grantor trust" for United States Federal income tax purposes.
The Delaware Trustee, upon a Responsible Officer obtaining actual
knowledge of the occurrence of a Funding Agreement Event of
Default, will notify the Indenture Trustee of any such Funding
Agreement Event of Default.
(f) The Delaware Trustee is authorized and directed to conduct the
affairs of the Trust and to operate the Trust so that the Trust
will not (i) become required to register as an "investment
company" under the Investment Company Act or (ii) fail to be
either ignored or treated as a "grantor trust" for United States
Federal income tax purposes. In connection with the preceding
sentence, the Delaware Trustee shall have no duty to determine
whether any action it takes complies with the preceding sentence
and shall be entitled to rely conclusively on an opinion of
counsel with respect to any such matters.
SECTION 6.2 General Duties. It shall be the duty of the Delaware Trustee to
discharge, or cause to be discharged, all of its responsibilities pursuant to
the terms of the Trust Agreement, or any other documents or instruments to which
it is a party, and to administer the Trust, in accordance with the provisions of
the Trust Agreement and the other Program Documents and any other documents or
instruments to which the Trust is a party. Notwithstanding the foregoing, the
Delaware Trustee shall be deemed to have discharged its duties and
responsibilities under the Trust Agreement and any other documents or
instruments to which the Trust is a party to the extent (a) such duties and
responsibilities shall have been performed by the Administrator and (b) the
Administrator is required or permitted under the Trust Agreement, under the
Administrative Services Agreement or under any other documents or instruments to
which the Trust is a party, to perform such act or discharge such duty of the
Delaware Trustee or the Trust; provided, however, that the Delaware Trustee
shall not be held liable for the default or failure of the Administrator to
carry out its required obligations under the Trust Agreement or thereunder but
only to the extent such obligations are not also required to be carried out by
the Delaware Trustee.
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SECTION 6.3 Specific Duties.
(a) The Delaware Trustee will manage the business and affairs of the
Trust in accordance with the terms of the Delaware Statutory
Trust Act; provided, however, that the Delaware Trustee
undertakes to perform only such duties as are specifically set
forth in the Trust Agreement and as it may be directed from time
to time by the Administrator, the Trust Beneficial Owner and the
Indenture Trustee in accordance with the terms of the Trust
Agreement and the Indenture.
(b) The Delaware Trustee agrees that it will not manage, control,
use, sell, dispose of or otherwise deal with the Collateral
except as expressly required or permitted by the terms of the
Trust Agreement and the Indenture.
(c) The Delaware Trustee shall not take any action, or direct the
Administrator to take any action, which would be inconsistent
with Section 2.8 of the Trust Agreement.
SECTION 6.4 Acceptance of Trust and Duties; Limitation on Liability. The
Delaware Trustee accepts the trust created by the Trust Agreement and agrees to
perform its duties under the Trust Agreement with respect to the same, but only
upon the terms of the Trust Agreement. No implied covenants or obligations shall
be read into the Trust Agreement. The Delaware Trustee shall not be liable under
the Trust Agreement under any circumstances except for (i) its own willful
misconduct, bad faith or gross negligence, (ii) its failure to use ordinary care
to disburse funds, or (iii) the inaccuracy of any representation or warranty
contained in the Trust Agreement expressly made by the Delaware Trustee. In
particular (but without limitation), subject to the exceptions set forth in the
preceding sentence:
(a) the Delaware Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless such
error of judgment constitutes gross negligence;
(b) the Delaware Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in
accordance with the written instructions of the Administrator,
the Trust Beneficial Owner or the Indenture Trustee or pursuant
to the advice of counsel, accountants or other experts selected
by it in good faith, so long as such action or omission is
consistent with the terms of the Trust Agreement and the
Indenture;
(c) no provision of the Trust Agreement shall require the Delaware
Trustee to expend or risk personal funds or otherwise incur any
20
financial liability in the performance of any of its rights or
powers under the Trust Agreement if the Delaware Trustee shall
have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not
reasonably assured or provided to it;
(d) under no circumstances shall the Delaware Trustee be liable for
indebtedness or other obligations evidenced by or arising under
the Trust Agreement, any Funding Agreement or any related
document, including the principal of and interest on the Notes;
(e) the Delaware Trustee shall not be responsible for, or in respect
of, the validity or sufficiency of the Trust Agreement or any
related document or for the due execution of the Trust Agreement
or thereof by any party (except by the Delaware Trustee itself)
or for the form, character, genuineness, sufficiency, value or
validity of any of the Collateral, other than the signature and
countersignature of the Delaware Trustee on any of the Program
Documents and the execution of any certificate;
(f) the Delaware Trustee shall (i) not be liable for any action,
inaction, default or misconduct of the Administrator, the
Indenture Trustee or any Paying Agent under the Indenture, the
Notes or any related documents or otherwise, and (ii) not have
any obligation or liability to perform the obligations of the
Trust under the Trust Agreement or any related document or under
any Federal, state, foreign or local tax or securities law, in
each case, that are required to be performed by other Persons,
including the Administrator under the Trust Agreement or under
the Administrative Services Agreement or the Indenture Trustee
under the Indenture;
(g) the Delaware Trustee shall not be liable for any action,
inaction, default or misconduct of Allstate Life, and the
Delaware Trustee shall not have any obligation or liability to
perform the obligations of Allstate Life under any Funding
Agreement or any related documents;
(h) the Delaware Trustee shall not be under any obligation to
exercise any of the rights or powers vested in it by the Trust
Agreement, or to institute, conduct or defend any litigation
under the Trust Agreement or otherwise or in relation to the
Trust Agreement or any related document, at the request, order or
direction of any Person unless such Person has offered to the
Delaware Trustee security or indemnity satisfactory to it against
21
the costs, expenses and liabilities that may be incurred by the
Delaware Trustee. The right of the Delaware Trustee to perform
any discretionary act enumerated in the Trust Agreement or in any
related document shall not be construed as a duty, and the
Delaware Trustee shall not be answerable in connection therewith
other than for its gross negligence or willful misconduct in the
performance of any such act;
(i) except as expressly provided in the Trust Agreement, in accepting
the trusts created by the Trust Agreement, the Delaware Trustee
acts solely as trustee under the Trust Agreement and not in its
individual capacity, and all Persons having any claim against the
Delaware Trustee by reason of the transactions contemplated by
the Trust Agreement shall look only to the Trust's property for
payment or satisfaction thereof;
(j) the Delaware Trustee shall not have any responsibility or
liability for or with respect to the genuineness, value,
sufficiency or validity of any Collateral, and the Delaware
Trustee shall in no event assume or incur any liability, duty or
obligation to the Administrator, the Trust Beneficial Owner or
any other Person other than as expressly provided for in the
Trust Agreement;
(k) the Delaware Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note or other paper
or document;
(l) every provision of the Trust Agreement relating to the Delaware
Trustee shall be subject to the provisions of this Article 6;
(m) except in accordance with the written instructions furnished by
the Trust Beneficial Owner or as provided in the Trust Agreement,
the Delaware Trustee shall have no duty (i) to see to any
recording or filing of any document, (ii) to confirm or verify
any financial statements of the Administrator, the Trust
Beneficial Owner or the Indenture Trustee, (iii) to inspect the
Administrator's, the Trust Beneficial Owner's or the Indenture
Trustee's books and records at any time or (iv) to see to the
payment or discharge of any tax, assessment or other governmental
charge or any lien or encumbrance of any kind owing with respect
to, assessed or levied against any part of the Trust, except to
the extent the Delaware Trustee has received funds, on behalf of
the Trust, pursuant to the Support Agreement from Allstate Life
22
in satisfaction of any such tax, assessment or other governmental
charge or any lien or encumbrance of any kind and in accordance
with payment or transfer instructions provided by Allstate Life;
(n) the Delaware Trustee shall have no duty or obligation to manage,
control, use, sell, dispose of or otherwise deal with the Trust
or to otherwise take or refrain from taking any action under the
Trust Agreement, except as expressly required by the terms of the
Trust Agreement, or as expressly provided in written instructions
from the Administrator, and in no event shall the Delaware
Trustee have any implied duties or obligations under the Trust
Agreement; the Delaware Trustee nevertheless agrees that it will,
at its own cost and expense, promptly take all action as may be
necessary to discharge any liens on any part of the property of
the Trust which result from claims against the Delaware Trustee
personally that are not related to the ownership or the
administration of the property of the Trust or the transactions
contemplated by the Program Documents;
(o) the Delaware Trustee shall not be required to take any action
under the Trust Agreement unless the Delaware Trustee shall have
been indemnified by the Trust, in manner and form satisfactory to
the Delaware Trustee, against any liability, cost or expenses
(including counsel fees and disbursements) which may be incurred
in connection therewith, and, in addition, the Trust shall pay
the reasonable compensation of the Delaware Trustee for the
services performed, as specified in and pursuant to the Series
Instrument; provided, that the Delaware Trustee shall not be
indemnified by any Person for the Delaware Trustee's willful
misconduct, bad faith or gross negligence, its failure to use
ordinary care to disburse funds or the inaccuracy of its own
representations or warranties, made in its individual capacity,
contained in the Trust Agreement;
(p) the Delaware Trustee shall not be required to take any action
under the Trust Agreement if the Delaware Trustee shall
reasonably determine or shall have been advised by counsel that
such action is contrary to the terms of the Trust Agreement or is
otherwise contrary to law;
(q) the Delaware Trustee may fully rely upon and shall have no
liability in connection with calculations or instructions
forwarded to the Delaware Trustee by the Administrator or the
Indenture Trustee, nor shall the Delaware Trustee have any
obligation to
23
furnish information to any Person if it has not received such
information as it may need from the Administrator, the Indenture
Trustee or any other Person;
(r) the Delaware Trustee shall not be liable with respect to any act
or omission in good faith in accordance with the advice or
direction of the Administrator or the Indenture Trustee. Whenever
the Delaware Trustee is unable to decide between alternative
courses of action permitted or required by the terms of the Trust
Agreement, or is unsure as to the application, intent,
interpretation or meaning of any provision of the Trust
Agreement, the Delaware Trustee may give notice (in such form as
shall be appropriate under the circumstances) to the
Administrator requesting instructions as to the course of action
to be adopted, and, to the extent the Delaware Trustee acts in
good faith in accordance with any such instruction received, the
Delaware Trustee shall not be liable on account of such action to
any Person. If the Delaware Trustee shall not have received
appropriate instructions within ten days of such notice (or
within such shorter period of time as reasonably may be specified
in such notice or may be necessary under the circumstances), it
may, but shall be under no duty to, take or refrain from taking
such action which is consistent, in its view, with the Trust
Agreement and as it shall deem to be in the best interest of the
Trust Beneficial Owner, and the Delaware Trustee shall have no
liability to any Person for such action or inaction;
(s) in no event whatsoever shall the Delaware Trustee be personally
liable for any representation, warranty, covenant, agreement,
indebtedness or other obligation of the Trust;
(t) the Delaware Trustee shall incur no liability if, by reason of
any provision of any present or future law or regulation
thereunder, or by any force majeure event, including but not
limited to natural disaster, war or other circumstances beyond
its control, the Delaware Trustee shall be prevented or forbidden
from doing or performing any act or thing which the terms of the
Trust Agreement provide shall or may be done or performed; and
(u) notwithstanding anything contained herein to the contrary, the
Delaware Trustee shall not be required to execute, deliver or
certify on behalf of the Trust any filings, certificates,
affidavits or other instruments required under the Sarbanes-Oxley
Act of 2002.
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SECTION 6.5 Reliance; Advice of Counsel.
(a) The Delaware Trustee shall incur no liability to anyone in acting
upon any signature, instrument, notice, resolution, request,
consent, order, certificate, report, opinion, bond or other
document or paper reasonably believed by it in good faith to be
genuine and signed by the proper party or parties. The Delaware
Trustee may accept a certified copy of a resolution of the board
of directors or other governing body of any corporate party as
conclusive evidence that such resolution has been duly adopted by
such body and that the same is in full force and effect. As to
any fact or matter the manner of ascertainment of which is not
specifically prescribed in the Trust Agreement, the Delaware
Trustee may for all purposes of the Trust Agreement rely on a
certificate, signed by the president or any vice president or by
the treasurer or any assistant treasurer or the secretary or any
assistant secretary of the relevant party, as to such fact or
matter, and such certificate shall constitute full protection to
the Delaware Trustee for any action taken or omitted to be taken
by it in good faith in reliance thereon.
(b) In the exercise or administration of the Trust, the Delaware
Trustee (i) may act directly or through its agents or attorneys
pursuant to agreements entered into with any of them; provided
that, the Delaware Trustee shall not be liable for the conduct or
misconduct of such agents or attorneys if such agents or
attorneys shall have been selected by the Delaware Trustee in
good faith and with reasonable care, and (ii) may consult with
counsel, accountants and other skilled Persons to be selected in
good faith and with reasonable care and employed by it, and it
shall not be liable for anything done, suffered or omitted to be
done in good faith by it in accordance with the written opinion
or advice of any such counsel, accountants or other skilled
Persons.
SECTION 6.6 Delegation of Authorities and Duties. The Delaware Trustee
delegates to the Administrator all duties required to be performed by the
Administrator pursuant to the terms of the Trust Agreement and the
Administrative Services Agreement. The Delaware Trustee undertakes no
responsibility for the performance, or non-performance, of any duties delegated
to the Administrator under the Trust Agreement, the Administrative Services
Agreement or the Indenture, as applicable.
SECTION 6.7 Indemnification. The Trust hereby agrees, whether or not any of
the transactions contemplated by the Trust Agreement shall be consummated, to
assume liability for, and hereby indemnifies, protects, saves and keeps harmless
the Delaware Trustee, and its officers, directors, successors, assigns, legal
25
representatives, agents and servants (each an "Indemnified Person"), from and
against any and all liabilities, obligations, losses, damages, penalties, taxes
(excluding any taxes payable by the Delaware Trustee on or measured by any
compensation received by the Delaware Trustee), claims, actions, investigations,
proceedings, costs, expenses or disbursements (including, without limitation,
reasonable legal fees and expenses, subject to the limitations imposed in this
Agreement) of any kind and nature whatsoever which may be imposed on, incurred
by or asserted at any time against an Indemnified Person (whether or not also
indemnified against by any other person but in all cases subject to the
limitations imposed in this Agreement) in any way relating to or arising out of
the Trust Agreement or any of the other agreements to which the Trust is or
becomes a party or the enforcement of any of the terms of any thereof or the
administration of the assets of the Trust or the action or inaction of the
Delaware Trustee under the Trust Agreement, except where any such claim for
indemnification has arisen as a result of the willful misconduct or gross
negligence on the part of the Indemnified Person, or the Indemnified Person's
failure to use ordinary care to disburse funds or the performance or
nonperformance of its duties under the Trust Agreement or any of the other
agreements to which the Trust becomes a party.
ARTICLE 7
TERMINATION OF AGREEMENT; DISSOLUTION OF THE TRUST
SECTION 7.1 Termination of Agreement. The Trust Agreement shall terminate
and the Trust shall dissolve, wind-up and terminate in accordance with Section
3808 of the Delaware Statutory Trust Act upon the latest to occur of:
(a) the payment to the Holders of any outstanding Notes and to the
Trust Beneficial Owner of all amounts required to be paid
pursuant to any Funding Notes, any Notes, the Indenture, the
Trust Agreement and the Program Documents;
(b) the payment of, or reasonable provision for payment of, all
expenses and other liabilities owed by the Trust; and
(c) the performance of all administrative actions by the Delaware
Trustee and the Administrator necessary to accomplish the
purposes of the Trust, including the performance of any tax
reporting obligations with respect to the Trust.
Any insolvency event, liquidation, dissolution, death or incapacity with
respect to the Trust Beneficial Owner, the Delaware Trustee, the Administrator
or any of the other agents of the Trust or any Holder shall not (i) operate to
terminate the Trust Agreement or the Trust, (ii) entitle any of their legal
representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of all or any part of the
Trust, (iii) otherwise affect the rights, obligations and liabilities of the
26
Holders or the parties hereto or any other document or any instrument entered
into by the Trust or (iv) dissolve the Trust.
The Trust shall dissolve only as provided in this Section 7.1, and
otherwise no Person, including the Administrator and the Trust Beneficial Owner,
shall be entitled to revoke or dissolve the Trust. The Administrator shall act
as the liquidator of the Trust and shall be responsible for directing the
Delaware Trustee to take all required actions in connection with winding up the
Trust. The Delaware Trustee shall have no liability for following such direction
to the extent it acts in good faith.
Upon the last event to occur as described above, the Delaware Trustee shall
cause the Certificate of Trust to be canceled by filing a certificate of
cancellation with the Secretary of State in accordance with the provisions of
Section 3810 of the Delaware Statutory Trust Act, at which time the Trust and
the Trust Agreement shall terminate.
In connection with the termination of the Trust and the distribution of all
amounts from each Payment Account in accordance with the priority set forth in
Section 3.1(b), the Delaware Trustee will distribute any amounts received
pursuant to Section 3.1(b) (clause Second) and any other remaining assets of the
Trust in the following order of priority:
First, to pay all expenses and other liabilities owed by the Trust;
and
Second, any remaining funds and other property shall be paid to the
Trust Beneficial Owner.
ARTICLE 8
SUCCESSOR AND ADDITIONAL DELAWARE TRUSTEES
SECTION 8.1 Eligibility Requirements for the Delaware Trustee. The Delaware
Trustee shall at all times (a) be a Person satisfying the provisions of Section
3807(a) of the Delaware Statutory Trust Act, (b) be authorized to exercise
corporate trust powers, (c) have a combined capital and surplus of at least
$50,000,000 and be subject to supervision or examination by Federal or State
authorities, (d) have (or have a parent which has) a rating of at least Baa3 by
Moody's or BBB- by Standard & Poor's, (e) be a "bank" within the meaning of
Section 581 of the Code and (f) be a "United States person" within the meaning
of Section 7701(a)(30) of the Code. In addition, the Delaware Trustee shall be
an entity with its Corporate Trust Office in the State of Delaware. If the
Delaware Trustee shall publish reports of condition at least annually, pursuant
to applicable law or to the requirements of the aforesaid supervising or
examining authority, then for the purpose of this Section 8.1, the combined
capital and surplus of the Delaware Trustee shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
27
published. If at any time the Delaware Trustee shall cease to be eligible in
accordance with the provisions of this Section 8.1, the Delaware Trustee shall
resign immediately in the manner and with the effect specified in Section 8.2.
SECTION 8.2 Resignation or Removal of the Delaware Trustee.
(a) The Delaware Trustee may resign as Delaware Trustee, or the
Administrator, acting on behalf of the Trust, may, in its sole
discretion, remove the Delaware Trustee, in each case upon not
less than 30 days' prior notice to the Delaware Trustee, the
Indenture Trustee and each Rating Agency then rating the Program
or the Notes. Upon any resignation or removal of the Delaware
Trustee, the Administrator, acting on behalf of the Trust, shall
appoint a successor Delaware Trustee whereupon such successor
Delaware Trustee shall succeed to the rights, powers and duties
of the Delaware Trustee, and the term "Delaware Trustee" shall
thereupon mean such successor Delaware Trustee effective upon
such appointment and approval, and the predecessor Delaware
Trustee's powers and duties as Delaware Trustee shall be
terminated, without any other or further act or deed on the part
of such predecessor Delaware Trustee or any of the parties to the
Trust Agreement or any holders of the obligations owing
hereunder; provided, that if at any time the Delaware Trustee
shall cease to be eligible in accordance with Section 8.1 and
shall have not resigned, or if at any time the Delaware Trustee,
shall become incapable of acting or shall be adjudged bankrupt or
insolvent, or a receiver for the Delaware Trustee or for its
property shall be appointed, or any public officer shall take
charge or control of the Delaware Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or
liquidation, then the Administrator may remove the Delaware
Trustee. On and after the effective date of any resignation or
removal of the Delaware Trustee hereunder, the provisions of this
Article 8 shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Delaware Trustee under the
Trust Agreement. Any such resignation or removal shall become
effective following the appointment of a successor Delaware
Trustee in accordance with the provisions of this Section 8.2.
(b) If no successor Delaware Trustee shall be appointed and shall
have accepted such appointment within 30 days after the aforesaid
notice of resignation or removal, the Trust (or the
Administrator, acting on its behalf) or the resigning Delaware
Trustee may apply to any court of competent jurisdiction to
28
appoint a successor Delaware Trustee to act until such time, if
any, as a successor Delaware Trustee shall have been appointed as
provided in this Section 8.2. Any successor so appointed by such
court shall immediately and without further act be superseded by
any successor Delaware Trustee appointed pursuant to this Section
8.2.
(c) Any resignation or removal of the Delaware Trustee and
appointment of a successor Delaware Trustee pursuant to any of
the provisions of this Section 8.2 shall not become effective
until all fees and expenses, including any indemnity payments,
due to the outgoing Delaware Trustee have been paid and until
acceptance of appointment by the successor Delaware Trustee
pursuant to Section 8.3.
(d) If at any time the Delaware Trustee shall resign or be removed or
otherwise become incapable of acting, or if at any time a vacancy
shall occur in the office of the Delaware Trustee for any other
cause, a successor Delaware Trustee shall be appointed as set
forth in this Section 8.2. The powers, duties, authority and
title of the predecessor Delaware Trustee shall be terminated and
canceled without any formality (except as may be required by
applicable law) other than appointment and designation of a
successor Delaware Trustee in writing duly acknowledged and
delivered to the predecessor Delaware Trustee and the Trust.
SECTION 8.3 Successor Delaware Trustee.
(a) Each successor Delaware Trustee appointed pursuant to Section 8.2
shall execute, acknowledge and deliver to the Administrator, the
Trust Beneficial Owner and the predecessor Delaware Trustee an
instrument accepting such appointment under the Trust Agreement,
and thereupon the resignation or removal of the predecessor
Delaware Trustee shall become effective, the resigning Delaware
Trustee shall be released of all duties and trusts under the
Trust Agreement and such successor Delaware Trustee, without any
further act, deed or conveyance, shall become fully vested with
all the rights, powers, duties, and obligations of its
predecessor under the Trust Agreement, with like effect as if
originally named as Delaware Trustee. The predecessor Delaware
Trustee shall deliver to the successor Delaware Trustee all
documents and statements and funds held by it under the Trust
Agreement; and the Administrator and the predecessor Delaware
Trustee shall execute and deliver such instruments and do such
29
other things as may reasonably be required for fully and
certainly vesting and confirming in the successor Delaware
Trustee all such rights, powers, duties and obligations.
(b) Any successor Delaware Trustee appointed under the Trust
Agreement shall promptly file an amendment to the Certificate of
Trust with the Secretary of State identifying the name and
principal place of business of such successor Delaware Trustee in
the State of Delaware.
(c) No successor Delaware Trustee shall accept appointment as
provided in this Section 8.3 unless at the time of such
acceptance such successor Delaware Trustee shall be eligible
pursuant to Section 8.1.
(d) Upon acceptance of appointment by a successor Delaware Trustee
pursuant to this Section 8.3, the Administrator shall mail notice
of such appointment to the Indenture Trustee and each Rating
Agency then rating the Program or the Notes. If the Administrator
shall fail to mail such notice within ten days after acceptance
of appointment by the successor Delaware Trustee, the successor
Delaware Trustee shall cause such notice to be mailed in the
manner aforesaid.
SECTION 8.4 Merger or Consolidation of Delaware Trustee. Any Person into
which the Delaware Trustee may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Delaware Trustee shall be a party, or any Person
succeeding to all or substantially all of the corporate trust business of the
Delaware Trustee, shall, without the execution or filing of any instrument or
any further act on the part of any of the parties to the Trust Agreement,
anything in the Trust Agreement to the contrary notwithstanding, be the
successor of the Delaware Trustee under the Trust Agreement; provided, such
Person shall be eligible pursuant to Section 8.1.
SECTION 8.5 Appointment of Co-Delaware Trustee or Separate Delaware
Trustee.
(a) Notwithstanding any other provisions of the Trust Agreement, at
any time, for the purpose of meeting any legal requirements of
any jurisdiction in which any part of any Collateral may at the
time be located, the Administrator and the Delaware Trustee shall
at any time have the power and shall execute and deliver all
instruments necessary to appoint one or more Persons approved by
the Delaware Trustee to act as co-Delaware Trustee, jointly with
it, or as separate Delaware Trustee or separate Delaware
30
Trustees, of all or any part of any Collateral and, subject to
Section 4.4 of the Trust Agreement, to vest in such Person, in
such capacity, such title to any Collateral, or any part thereof,
and, subject to the other provisions of this Section 8.5, such
powers, duties, obligations, rights and trusts as the
Administrator and the Delaware Trustee may deem necessary or
desirable. If the Administrator shall not have joined in such
appointment within 15 days after the receipt by it of a request
so to do, the Delaware Trustee alone shall have the power to make
such appointment. No co-Delaware Trustee or separate Delaware
Trustee under the Trust Agreement shall be required to meet the
terms of eligibility as a successor Delaware Trustee pursuant to
Section 8.1 and no notice of the appointment of any co-Delaware
Trustee or separate Delaware Trustee shall be required; provided,
however, that any co-Delaware Trustee or separate Delaware
Trustee must be a "United States person" within the meaning of
Section 7701(a)(30) of the Code and a "bank" within the meaning
of Section 581 of the Code.
(b) Each separate Delaware Trustee and co-Delaware Trustee shall, to
the extent permitted by law, be appointed and act subject to the
following provisions and conditions:
(i) all rights, powers, duties, and obligations conferred or
imposed upon the Delaware Trustee shall be conferred or
imposed upon and exercised or performed by the Delaware
Trustee and such separate Delaware Trustee or co-Delaware
Trustee jointly (it being understood that such separate
Delaware Trustee or co-Delaware Trustee is not authorized to
act separately without the Delaware Trustee joining in such
act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be
performed, the Delaware Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such
rights, powers, duties and obligations (including the
holding of title to the Trust or any portion thereof in any
such jurisdiction) shall be exercised and performed by such
separate Delaware Trustee or co-Delaware Trustee, but solely
at the discretion of the Delaware Trustee;
(ii) the Administrator and the Delaware Trustee acting jointly
may at any time accept the resignation of or remove any
separate Delaware Trustee or co-Delaware Trustee; and
31
(iii) no Delaware Trustee shall be personally liable by reason of
the act or omission of any other Delaware Trustee under the
Trust Agreement.
(c) Any notice, request or other writing given to the Delaware
Trustee shall be deemed to have been given to each of the then
acting separate Delaware Trustee and co-Delaware Trustee, as
effectively as if given to each of them. Every instrument
appointing any separate Delaware Trustee or co-Delaware Trustee
shall refer to this Section 8.5 and the conditions of this
Article 8. Each separate Delaware Trustee and co-Delaware
Trustee, upon its acceptance of the trusts conferred, shall be
vested with the estates or property specified in its instruments
of appointment, either jointly with the Delaware Trustee or
separately, as may be provided therein, subject to all the
provisions of the Trust Agreement, specifically including every
provision of the Trust Agreement relating to the conduct of,
affecting the liability of, or affording protection to, the
Delaware Trustee. Each such instrument shall be filed with the
Delaware Trustee and a copy thereof shall be given to the
Administrator.
(d) Any separate Delaware Trustee or co-Delaware Trustee may at any
time appoint the Delaware Trustee as its agent or
attorney-in-fact with full power and authority, to the extent not
prohibited by law, to do any lawful act under or in respect of
the Trust Agreement on its behalf and in its name. If any
separate Delaware Trustee or co-Delaware Trustee shall become
incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be
exercised by the Delaware Trustee, to the extent permitted by
law, without the appointment of a new or successor Delaware
Trustee.
SECTION 8.6 Delaware Trustee May Own Notes. Except to the extent prohibited
under the terms of the Notes, the Delaware Trustee, in its individual or any
other capacity, may become the beneficial owner or pledgee of Notes, to the
extent that such ownership does not inhibit the Trust from relying on the
applicable exemption from registration as an "investment company" under the
Investment Company Act, with the same rights as it would have if it were not the
Delaware Trustee; provided, that any Notes so owned or pledged shall not be
entitled to participate in any decisions made or instructions given to the
Delaware Trustee or the Indenture Trustee by the Holders as a group. Except as
otherwise provided in this Section 8.6, the Delaware Trustee may deal with the
Trust and the Trust Beneficial Owner in banking and trustee transactions with
the same rights as it would have if it were not the Delaware Trustee.
32
ARTICLE 9
MISCELLANEOUS PROVISIONS
SECTION 9.1 Limitation on Rights of Others.
The death, bankruptcy, termination, dissolution or incapacity of any Person
having an interest, beneficial or otherwise, in the Trust shall not operate to
terminate the Trust Agreement, nor to annul, dissolve or terminate the Trust,
nor to entitle the legal successors, representatives or heirs of any such
Person, to claim an accounting, take any action or bring any proceeding in any
court for a partition or winding up of the arrangements contemplated by the
Trust Agreement, nor otherwise affect the rights, obligations and liabilities of
the parties to the Trust Agreement or any of them.
SECTION 9.2 Amendments.
(a) The Trust Agreement may be amended from time to time by the
Delaware Trustee and the Administrator by a written instrument
executed by the Delaware Trustee and the Administrator, in any
way that is not inconsistent with the intent of the Trust
Agreement, including, without limitation to: (i) cure any
ambiguity, (ii) correct, supplement or modify any provision of
the Trust Agreement that is inconsistent with another provision
of the Trust Agreement or (iii) modify, eliminate or add to any
provisions of the Trust Agreement to the extent necessary to
ensure that the Trust will, at all times, for United States
Federal income tax purposes will be either ignored or treated as
a "grantor trust" or to ensure that the Trust will not be
required to register as an "investment company" under the
Investment Company Act and no such amendment shall require the
consent of any other Person, except to the extent specified in
Sections 9.2(c) and 9.2(d).
(b) So long as any Notes remain outstanding, except as provided in
Sections 9.2(c) and 9.2(d), any amendment to the Trust Agreement
that would adversely affect, in any material respect, the terms
of any Notes, other than any amendment of the type contemplated
by clause (iii) of Section 9.2(a), shall require the prior
consent of the Holders of a majority of the outstanding principal
amount of the Notes.
(c) So long as any Notes remain outstanding, the Trust Agreement may
not be amended to (i) change the amount or timing of any payment
of any Notes or (ii) impair the right of any Holder to institute
suit for the enforcement of any right for principal and interest
33
or other distribution, in each case without the consent of each
affected Holder.
(d) The Delaware Trustee shall not be required to enter into any
amendment to the Trust Agreement which adversely affects its own
rights, duties or immunities under the Trust Agreement.
(e) Prior to the execution of any amendment to the Trust Agreement,
the Delaware Trustee shall be entitled to an opinion of counsel
as to whether such amendment is permitted by the terms of the
Trust Agreement and whether all conditions precedent to such
amendment have been met, in each case under the laws of the State
of Delaware.
(f) Promptly after the execution of any such amendment or consent,
the Administrator shall furnish a copy of such amendment or
consent (including those obtained or effected by the Trust
Agreement) to the Indenture Trustee, the Trust Beneficial Owner,
the Agents and the Rating Agencies.
(g) Contemporaneously with, or promptly after, the execution of any
amendment to the Trust Agreement requiring amendment to the
Certificate of Trust, the Delaware Trustee shall cause the filing
of such amendment to the Certificate of Trust with the Secretary
of State.
(h) Notwithstanding any other provision of the Trust Agreement, no
amendment to the Trust Agreement may be made (i) if such
amendment would cause (A) the Trust not to be either ignored or
treated as a "grantor trust" for United States Federal income tax
purposes or (B) the Notes to be treated as other than
indebtedness of Allstate Life and (ii) no amendment to the Trust
Agreement may be made without the prior consent of Allstate Life.
SECTION 9.3 Notices. All demands, notices, instructions and other
communications shall be in writing (including telecopied or telegraphic
communications) and shall be personally delivered, mailed or transmitted by
telecopy or telegraph, respectively, addressed as set forth below (or, in the
case of any other relevant party, addressed as set forth in a separate notice
delivered to all relevant parties):
34
If to Delaware Trustee:
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, DE 19890-0001
Attention: Corporate Trust Administration
Facsimile: (302) 636-4140
If to the Trust Beneficial Owner:
Allstate Life Global Funding
c/o AMACAR Pacific Corp.
6525 Morrison Boulevard, Suite 318
Charlotte, North Carolina 28211
Attention: President
Facsimile: (704) 365-1632
If to the Administrator:
AMACAR Pacific Corp.
6525 Morrison Blvd., Suite 318
Charlotte, North Carolina 28211
Attention: Douglas K. Johnson
Facsimile: (704) 365-1632
with a copy to:
Tannenbaum Helpern Syracuse & Hirschtritt LLP
900 3rd Avenue
New York, NY 10022
Attention: Stephen Rosenberg
Facsimile: -
If to the Indenture Trustee:
J.P. Morgan Trust Company, National Association
227 W. Monroe Street,
Suite 2600,
Chicago, IL 60606
Attention: -
Facsimile: -
35
If to the Rating Agencies:
Standard & Poor's Ratings Services,
a division of The McGraw-Hill Companies, Inc.
55 Water Street
New York, NY 10041
Attention: Capital Markets
Facsimile: (212) 438-5215
Moody's Investors Service Inc.
99 Church Street
New York, NY 10007
Attention: Life Insurance Group
Facsimile: (212) 553-4805
or at such other address as shall be designated by any such person in a written
notice to each other person required to give or entitled to receive any notices
hereunder. Notwithstanding the foregoing, any notice required or permitted to be
mailed to the Trust Beneficial Owner shall be given by first class mail, postage
prepaid, at the then current address of the Administrator, and any notices
mailed within the time prescribed in the Trust Agreement shall be conclusively
presumed to have been duly given, whether or not the Trust Beneficial Owner
received such notice. Any notice required or permitted to be mailed to any
Holder of a Note shall be given as specified in the Indenture.
SECTION 9.4 No Recourse to Certain Persons. The Trust Beneficial Owner
acknowledges that its beneficial interest in the Trust does not represent an
obligation of Allstate Life, the Delaware Trustee, the Administrator, the
Indenture Trustee or any Affiliate of any of the foregoing and no recourse may
be had against such parties or their assets, except as may be expressly set
forth or contemplated in the Trust Agreement or the Indenture.
SECTION 9.5 Limited Recourse. Notwithstanding anything to the contrary
contained in the Trust Agreement, the obligations of the Trust under the Trust
Agreement and all Program Documents and other documents or instruments entered
into by the Trust, are solely the obligations of the Trust and shall be payable
solely to the extent of funds received by and available to the Trust under the
Funding Agreements, the other Collateral and the Support Agreement. No recourse
shall be had for the payment of any amount owing in respect of any obligation
of, or claim against, the Trust arising out of or based upon the Trust
Agreement, the Notes or any other Program Document against any holder of a
beneficial interest, employee, agent, officer or Affiliate of the Trust and,
except as specifically provided in the Trust Agreement and in the other Program
Documents, no recourse shall be had for the payment of any amount owing in
respect of any obligation of, or claim against, the Trust arising out of or
based upon the Trust Agreement, the Notes or any other Program Documents against
36
the Indenture Trustee, the Delaware Trustee, the Administrator, Allstate Life,
the Agents or any of their respective holders of beneficial interests,
employees, agents, officers, directors, incorporators or Affiliates.
SECTION 9.6 No Petition. To the extent permitted by applicable law, each of
the Delaware Trustee and the Administrator covenants and agrees, and the Trust
Beneficial Owner by its acceptance of a beneficial interest in the Trust will be
deemed to have covenanted and agreed, that it will not institute against, or
join with any other Person in instituting against, the Trust any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any applicable bankruptcy or similar law. This Section 9.6
shall survive any termination of the Trust Agreement.
SECTION 9.7 Governing Law. The Trust Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware, without regard
to its choice of law principles.
SECTION 9.8 Severability. If any provision in the Trust Agreement shall be
invalid, illegal or unenforceable, such provisions shall be deemed severable
from the remaining provisions of the Trust Agreement and shall in no way affect
the validity or enforceability of such other provisions of the Trust Agreement.
SECTION 9.9 No Third Party Beneficiaries. The Trust Agreement shall inure
to the benefit of and be binding upon the parties to the Trust Agreement and
their respective successors and permitted assigns. Except as otherwise provided
in the Trust Agreement, no other Person shall have any right or obligation under
the Trust Agreement.
SECTION 9.10 Counterparts. The Trust Agreement and any amendments,
supplements, modifications, restatements or replacements of the Trust Agreement,
or waivers or consents to the Trust Agreement, may be executed in any number of
counterparts, and by different parties to the Trust Agreement in separate
counterparts, each of which, when so executed and delivered, shall be deemed to
be an original and all of which counterparts, when taken together, shall
constitute one and the same instrument. The Trust Agreement shall become
effective upon the execution of a counterpart to each of the parties to the
Trust Agreement.
37
EXHIBIT 4.4
===============================================================================
STANDARD INDENTURE TERMS
with respect to
ALLSTATE LIFE GLOBAL FUNDING TRUSTS
SECURED MEDIUM-TERM NOTES
and
ALLSTATE LIFE(R) CORENOTES(R)
===============================================================================
Allstate Life(R) is a registered service mark of Allstate Insurance Company.
CoreNotes(R) is a registered service mark of Merrill Lynch & Co., Inc.
TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS
SECTION 1.1 Certain Terms Defined............................................................1
SECTION 1.2 Interpretation..................................................................12
ARTICLE 2
THE NOTES
SECTION 2.1 Amount Unlimited................................................................12
SECTION 2.2 Status of Notes.................................................................13
SECTION 2.3 Forms Generally.................................................................13
SECTION 2.4 Currency; Denominations.........................................................13
SECTION 2.5 Execution, Authentication, Delivery and Date....................................14
SECTION 2.6 Registration, Transfer and Exchange.............................................15
SECTION 2.7 Mutilated, Destroyed, Lost or Stolen Note Certificates..........................17
SECTION 2.8 Interest Record Dates...........................................................18
SECTION 2.9 Cancellation....................................................................19
SECTION 2.10 Global Securities...............................................................19
SECTION 2.11 Withholding Tax.................................................................21
SECTION 2.12 Tax Treatment...................................................................21
ARTICLE 3
REDEMPTION, REPAYMENT AND REPURCHASE OF NOTES; SINKING FUNDS
SECTION 3.1 Redemption of Notes.............................................................22
SECTION 3.2 Repayment at the Option of the Holder...........................................26
SECTION 3.3 Repurchase of Notes.............................................................26
SECTION 3.4 Sinking Funds...................................................................27
ARTICLE 4
PAYMENTS; PAYING AGENTS AND CALCULATION AGENT; COVENANTS
SECTION 4.1 Payment of Principal and Interest...............................................27
SECTION 4.2 Collection Account..............................................................31
SECTION 4.3 Offices for Payments, Etc.......................................................31
SECTION 4.4 Appointment to Fill a Vacancy in Office of Indenture Trustee....................32
SECTION 4.5 Paying Agents...................................................................32
SECTION 4.6 Calculation Agent...............................................................36
SECTION 4.7 Certificate to Indenture Trustee................................................39
SECTION 4.8 Negative Covenants..............................................................39
SECTION 4.9 Non-Petition....................................................................39
SECTION 4.10 Additional Amounts..............................................................39
ARTICLE 5
REMEDIES OF THE INDENTURE TRUSTEE AND HOLDERS ON EVENT OF DEFAULT
SECTION 5.1 Event of Default Defined; Acceleration of Maturity; Waiver of Default...........41
SECTION 5.2 Collection of Indebtedness by Indenture Trustee; Indenture
Trustee May Prove Debt..........................................................45
SECTION 5.3 Application of Proceeds.........................................................47
SECTION 5.4 Suits for Enforcement...........................................................49
SECTION 5.5 Restoration of Rights on Abandonment of Proceedings.............................49
SECTION 5.6 Limitations on Suits by Holders.................................................49
SECTION 5.7 Powers and Remedies Cumulative; Delay or Omission Not Waiver of Default.........50
SECTION 5.8 Control by the Holders..........................................................51
SECTION 5.9 Waiver of Past Defaults.........................................................51
ARTICLE 6
THE INDENTURE TRUSTEE
SECTION 6.1 Certain Duties and Responsibilities.............................................52
SECTION 6.2 Certain Rights of the Indenture Trustee.........................................53
SECTION 6.3 Not Responsible for Recitals, Validity of the Notes or
Application of the Proceeds.....................................................55
SECTION 6.4 May Hold Notes; Collections, Etc................................................55
SECTION 6.5 Funds Held By Indenture Trustee.................................................55
SECTION 6.6 Compensation; Reimbursement; Indemnification....................................55
SECTION 6.7 Corporate Trustee Required; Eligibility.........................................56
SECTION 6.8 Resignation and Removal; Appointment of Successor Trustee.......................57
SECTION 6.9 Acceptance of Appointment by Successor Trustee..................................59
SECTION 6.10 Merger, Conversion, Consolidation or Succession to Business
of Indenture Trustee............................................................60
SECTION 6.11 Limitations on Rights of Indenture Trustee as Creditor..........................61
ARTICLE 7
HOLDERS' LISTS AND REPORTS BY INDENTURE TRUSTEE AND TRUST
SECTION 7.1 Trust To Furnish Indenture Trustee Names And Addresses Of Holders...............61
SECTION 7.2 Preservation of Information; Communication to Holders...........................61
SECTION 7.3 Reports by Indenture Trustee....................................................61
SECTION 7.4 Reports and Opinions by Trust...................................................62
ii
SECTION 7.5 Reports on Assessment of Compliance with Servicing Criteria
and Compliance Statements; Attestation Reports of Registered
Public Accounting Firm..........................................................64
ARTICLE 8
CONCERNING EACH HOLDER
SECTION 8.1 Evidence of Action Taken by a Holder............................................64
SECTION 8.2 Proof of Execution of Instruments and of Holding of Notes.......................65
SECTION 8.3 Voting Record Date..............................................................65
SECTION 8.4 Persons Deemed to be Owners.....................................................65
SECTION 8.5 Notes Owned by Trust Deemed Not Outstanding.....................................66
SECTION 8.6 Right of Revocation of Action Taken; Binding Effect of Actions
by Holders......................................................................66
ARTICLE 9
SUPPLEMENTAL INDENTURES
SECTION 9.1 Supplemental Indentures Without Consent of Holders..............................67
SECTION 9.2 Supplemental Indentures With Consent of Holders.................................68
SECTION 9.3 Compliance with Trust Indenture Act; Effect of Supplemental Indentures..........69
SECTION 9.4 Documents to Be Given to Indenture Trustee......................................70
SECTION 9.5 Notation on Note Certificates in Respect of Supplemental Indentures.............70
SECTION 9.6 Amendment to Funding Agreements.................................................70
ARTICLE 10
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 10.1 Trust May Merge, Consolidate, Sell Or Convey Property
Under Certain Circumstances.....................................................72
ARTICLE 11
SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED FUNDS
SECTION 11.1 Satisfaction and Discharge of Indenture.........................................72
SECTION 11.2 Application by Indenture Trustee of Funds Deposited for
Payment of Notes................................................................73
SECTION 11.3 Repayment of Funds Held by Paying Agent.........................................73
SECTION 11.4 Return of Funds Held by Indenture Trustee and Paying Agent......................74
ARTICLE 12
MEETINGS OF HOLDERS OF NOTES
SECTION 12.1 Purposes for Which Meetings May Be Called.......................................74
iii
SECTION 12.2 Call, Notice and Place of Meetings..............................................74
SECTION 12.3 Persons Entitled to Vote at Meetings............................................75
SECTION 12.4 Quorum; Action..................................................................75
SECTION 12.5 Determination of Voting Rights; Conduct of Adjournment of
Meetings........................................................................76
SECTION 12.6 Counting Votes and Recording Action of Meetings.................................77
ARTICLE 13
MISCELLANEOUS PROVISIONS
SECTION 13.1 No Recourse.....................................................................78
SECTION 13.2 Provisions of Indenture for the Sole Benefit of Parties
and Holders.....................................................................78
SECTION 13.3 Successors and Assigns of Trust Bound by Indenture..............................78
SECTION 13.4 Notices and Demands on Trust, Indenture Trustee and any
Holder..........................................................................79
SECTION 13.5 Trust Certificates and Opinions of Counsel; Statements to be
Contained Therein...............................................................80
SECTION 13.6 Governing Law...................................................................82
SECTION 13.7 Counterparts....................................................................82
SECTION 13.8 Trust Indenture Act to Control..................................................82
SECTION 13.9 Judgment Currency...............................................................82
ARTICLE 14
SECURITY INTEREST
SECTION 14.1 Security Interest...............................................................83
SECTION 14.2 Representations and Warranties..................................................84
SECTION 14.3 Additional Representations and Warranties.......................................85
SECTION 14.4 Further Assurances; Covenants...................................................86
SECTION 14.5 General Authority...............................................................88
SECTION 14.6 Remedies Upon Event of Default..................................................88
SECTION 14.7 Limitation on Duties of Indenture Trustee with Respect to
Collateral......................................................................89
SECTION 14.8 Concerning the Indenture Trustee................................................89
SECTION 14.9 Termination of Security Interest................................................90
EXHIBIT A-1 Form of Global Security for Secured Medium Term Notes
Program A-1-1
EXHIBIT A-2 Form of Definitive Security for Secured Medium Term Notes
Program A-2-1
EXHIBIT A-3 Form of Global Security for Allstate Life(R) CoreNotes(R) Program A-3-1
EXHIBIT A-4 Form of Definitive Security for Allstate Life(R) CoreNotes(R)
Program A-4-1
iv
EXHIBIT B Form of Certificate of Authentication B-1
EXHIBIT C Form of Indenture Trustee Report Pursuant to Section 7.3(f) C-1
v
This document constitutes the Standard Indenture Terms, which will be
incorporated by reference in, and form a part of, the Indenture (as defined
below), by and among the Trust (as defined below) and the Indenture Trustee,
Calculation Agent, Exchange Rate Agent, Paying Agent, Registrar and Transfer
Agent (as defined below).
These Standard Indenture Terms shall be of no force and effect unless and
until incorporated by reference into, and then only to the extent not modified
by, such Indenture.
The following Standard Indenture Terms shall govern the Notes subject to
contrary terms and provisions expressly adopted in the Indenture, any
Supplemental Indenture or the Notes, which contrary terms shall be controlling.
ARTICLE 1
DEFINITIONS
SECTION 1.1 Certain Terms Defined. The following terms shall have the
meanings specified in this Section for all purposes of the Indenture and the
Notes, unless otherwise expressly provided. All other terms used in the
Indenture which are defined in the Trust Indenture Act or which are by reference
therein defined in the Securities Act shall have the meanings (except as
otherwise expressly provided in the Indenture or unless the context otherwise
clearly requires) assigned to such terms in the Trust Indenture Act and in the
Securities Act as in force at the date of the Indenture as originally executed.
"Additional Amounts" means any additional amounts which may be required by
the Notes, under circumstances specified in a Note Certificate or Supplemental
Indenture, to be paid by the Trust in respect of certain taxes, assessments or
other governmental charges imposed on Holders specified therein and which are
owing to such Holders.
"Administrative Services Agreement" means that certain administrative
services agreement included in Part B of the Series Instrument, by and between
the Trust and the Administrator, as the same may be amended, supplemented,
modified, restated or replaced from time to time.
"Administrator" means AMACAR Pacific Corp., a Delaware corporation, in its
capacity as the sole administrator of the Trust, or another entity specified in
the Indenture as the Administrator, and, in each case, its permitted successors
and assigns.
"Affiliate" means, as applied to any Person, any other Person directly or
indirectly controlling, controlled by, or under common control with, that Person
and, in the case of an individual, any spouse or other member of that
individual's immediate family. For the purposes of this definition, "control"
(including with correlative meanings, the terms "controlling", "controlled by"
and "under common control with"),
1
as applied to any Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of that
Person, whether through the ownership of voting securities or by contract or
otherwise.
"Agents" has the meaning ascribed in the Distribution Agreement.
"Amended and Restated Administrative Services Agreement" means that certain
Amended and Restated Administrative Services Agreement dated as of -, 2006,
between AMACAR Pacific Corp. and Global Funding, as the same may be amended,
supplemented, modified, restated or replaced from time to time.
"Annual Redemption Percentage Reduction" has the meaning ascribed in the
Note Certificate(s) or the Indenture.
"Annual Report" has the meaning ascribed in Section 7.5.
"Book-Entry Note" means a Note, the registered ownership of which is
represented by a Global Security.
"Business Day" means (except as otherwise provided in the Pricing
Supplement) any day, other than a Saturday or Sunday, that is neither a legal
holiday nor a day on which commercial banks are authorized or required by law,
regulation or executive order to close in The City of New York; provided,
however, that, if the Specified Currency of the Notes is other than U.S.
Dollars, the day must also not be a day on which commercial banks are authorized
or required by law, regulation or executive order to close in the Principal
Financial Center of the country issuing the Specified Currency (or, if the
Specified Currency is Euro, the day must also be a day on which the Target
System is open).
"Calculation Agent" means the Indenture Trustee in its capacity as
calculation agent with respect to the Notes, or any other Person specified as
calculation agent with respect to any Notes in the Note Certificate(s) or the
Indenture, and, in each case, it successor in such capacity.
"Certificated Note" means a Note represented by a Definitive Security.
"Clearing Corporation" means DTC, or any other clearing system specified in
the Note Certificate(s) and their respective successors and "Clearing
Corporations" means all of the foregoing.
"Closing Instrument" means the closing instrument of the Trust, pursuant to
which certain documents are executed in connection with the issuance of the
Notes by the Trust.
2
"Code" means the United States Internal Revenue Code of 1986, as amended,
including any successor statutes and any applicable rules, regulations, notices
or orders promulgated thereunder.
"Collateral" means, with respect to the Notes, the right, title and
interest of the Trust in and to (i) each Funding Agreement held in the Trust,
(ii) all Proceeds in respect of each such Funding Agreement and (iii) all books
and records (including without limitation, computer programs, printouts and
other computer materials and files) of the Trust pertaining to the Funding
Agreement(s).
"Collection Account" has the meaning ascribed in Section 4.2.
"Commission" means the Securities and Exchange Commission or any successor
body.
"Compliance Report" has the meaning ascribed in Section 7.5.
"Coordination Agreement" means that certain Coordination Agreement included
in Part F of the Series Instrument, among the Trust and the other parties
specified therein, as the same may be amended, supplemented, modified, restated
or replaced from time to time.
"Corporate Trust Office" means the office of the Indenture Trustee at which
the Indenture shall, at any particular time, be administered, which office is,
at the date as of which the Indenture is executed located at 227 W. Monroe
Street, Suite 2600, Chicago, IL 60606, except that for the purposes of Section
4.3 it shall be 4 New York Plaza, 1st Floor, New York, New York 10004, or such
other location as may be specified in or pursuant to the Note Certificate(s) or
the Indenture.
"Custodian" has the meaning ascribed in Section 14.3(e).
"Debt" of any Person means, at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of
business, all obligations of such Person as lessee which are capitalized in
accordance with generally accepted accounting principles, (iv) all contingent
and non-contingent obligations of such Person to reimburse any bank or other
Person in respect of amounts paid under a letter of credit or similar
instrument, (v) all Debt secured by a Lien on any asset of such Person, whether
or not such Debt is otherwise an obligation of such Person, and (vi) all
Guarantees by such Person of Debt of another Person (each such Guarantee to
constitute Debt in an amount equal to the amount of such other Person's Debt
Guaranteed thereby).
"Defaulted Interest" has the meaning ascribed in Section 2.8(b).
3
"Definitive Security" means any Note Certificate which is not a Global
Security.
"Delaware Trustee" means Wilmington Trust Company, a Delaware banking
corporation, or another entity specified in the Indenture as the Delaware
Trustee, in each case not in its individual capacity but solely as trustee, and
its successors.
"Depositary" shall mean, if the Notes are represented by one or more Global
Securities, the Clearing Corporation or its agent or nominee designated as
Depositary by the Trust pursuant to Section 2.10 until a successor Depositary
shall have become such pursuant to the applicable provisions of the Indenture,
and thereafter "Depositary" shall mean or include each Person who is then a
Depositary under the Indenture. The Depositary must, at the time of its
designation and at all times while it serves as Depositary, be a clearing agency
registered under the Exchange Act and any other applicable statute or
regulation. Unless otherwise specified in the Note Certificate(s), the
"Depositary" shall initially be DTC.
"Distribution Agreement" means that certain Distribution Agreement dated as
of -, 2006, by and among Global Funding and the Agents named therein, as the
same may be amended, supplemented, modified, restated or replaced from time to
time.
"DTC" means The Depository Trust Company and its successors and assigns.
"Entitlement Holder" means any Person in whose name Notes are credited to a
securities account maintained in the name of such Person on the books and
records of a Clearing Corporation or other Securities Intermediary.
"Euro" means the currency introduced at the start of the third stage of the
European economic and monetary union pursuant to the treaty establishing the
European Community, as amended by the Treaty on European Union.
"Event of Default" means any event or condition specified as such in
Section 5.1 which shall have continued for the period of time, if any, therein
designated.
"Exchange Act" means the Securities Exchange Act of 1934, as it may be
amended or supplemented from time to time, and any successor statute thereto,
and the rules, regulations and published interpretations of the Commission
promulgated thereunder from time to time.
"Exchange Event" has the meaning ascribed in Section 2.10(b).
"Exchange Rate Agent" means the Indenture Trustee in its capacity as
exchange rate agent with respect to the Notes, or any other person specified as
exchange rate agent with respect to any Notes in the Note Certificate(s) or the
Indenture, and, in each case, its successors in such capacity.
4
"Foreign Currency Note" means a Note the Specified Currency of which is
other than U.S. Dollars.
"Funding Agreement" means each funding agreement issued by the Funding
Agreement Provider to Global Funding, which is immediately pledged and
collaterally assigned by Global Funding to the Funding Note Indenture Trustee
and immediately thereafter assigned absolutely to, and deposited into, the Trust
by Global Funding, as the same may be amended, supplemented, modified, restated
or replaced from time to time in accordance with the terms thereof.
"Funding Agreement Provider" means Allstate Life Insurance Company, a stock
life insurance company organized under the laws of the State of Illinois, and
its successors.
"Funding Note" has the meaning ascribed in the Funding Note Indenture.
"Funding Note Indenture" means that certain Funding Note Indenture included
in Part H of the Series Instrument, among Global Funding and the other parties
specified therein, as the same may be amended, supplemented, modified, restated
or replaced from time to time.
"Funding Note Indenture Trustee" has the meaning ascribed in the Funding
Note Indenture.
"Global Funding" means Allstate Life Global Funding, a statutory trust
formed under the laws of the State of Delaware.
"Global Security" means a single Note Certificate deposited with the
Depositary and registered in the name of a Clearing Corporation or its agent or
nominee representing the entire issue of Book-Entry Notes, or if the rules of
the applicable Clearing Corporation or the applicable securities laws or
regulations of any jurisdiction limit the maximum principal amount of Note
Certificates, each of the minimum number of Note Certificates so deposited and
registered that are required to comply with such laws, regulations and rules
while representing in the aggregate the entire issue of Book-Entry Notes.
"Guarantee" by any Person means any obligation, contingent or otherwise, of
such Person directly or indirectly guaranteeing any Debt of any other Person
and, without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Debt (whether
arising by virtue of partnership arrangements, by virtue of an agreement to
keep-well, to purchase assets, goods, securities or services, to take-or-pay, or
to maintain financial statement conditions or otherwise), (ii) to reimburse a
bank for amounts drawn under a letter of credit for the purpose of paying such
Debt or (iii) entered into for the purpose of
5
assuring in any other manner the holder of such Debt of the payment thereof or
to protect such holder against loss in respect thereof (in whole or in part);
provided that the term "Guarantee" shall not include endorsements for collection
or deposit in the ordinary course of business.
The term "Guarantee" used as a verb has a corresponding meaning.
"Holder" means, with respect to any Note, the Person in whose name such
Note is registered in the Note Register.
"Holder Representative" has the meaning ascribed in Section 5.8(a).
"Indenture" means that certain Indenture included in Part G of the Series
Instrument, and which incorporates by reference these Standard Indenture Terms,
among the Trust and the other parties specified therein, as the same may be
amended, supplemented, modified, restated or replaced from time to time.
"Indenture Trustee" means J.P. Morgan Trust Company, National Association,
or another entity specified as the Indenture Trustee in the Indenture, and, in
each case, its successors.
"Initial Redemption Date" means, with respect to any Note or portion
thereof to be redeemed pursuant to Section 3.1(b), the date on or after which
such Note or portion thereof may be redeemed as determined by or pursuant to the
Indenture or a Note Certificate of Supplemental Indenture.
"Initial Redemption Percentage" has the meaning specified in the Note
Certificate(s).
"Interest Payment Date" has the meaning ascribed in Section 2.8(a).
"Interest Reset Date" has the meaning ascribed in the Note Certificate(s).
"Investment Company Act" has the meaning ascribed in Section 4.8.
"Judgment Currency" has the meaning ascribed in Section 13.9.
"LIBOR", has the meaning ascribed in the Note Certificate(s).
"LIBOR Currency" means the currency specified in the Note Certificate(s) as
to which LIBOR shall be calculated or, if no currency is specified in the
applicable Note Certificate, United States dollars.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind, or any other type of
preferential arrangement that has substantially the same practical effect as a
security interest, in
6
respect of such asset. For purposes hereof, the Trust shall be deemed to own
subject to a Lien any asset which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such asset.
"Market Exchange Rate" for a Specified Currency other than United States
dollars means the noon dollar buying rate in The City of New York for cable
transfers for the Specified Currency as certified for customs purposes (or, if
not so certified, as otherwise determined) by the Federal Reserve Bank of New
York.
"Maturity Date" means, with respect to the principal (or any installment of
principal) of the Notes, any date prior to the Stated Maturity Date on which the
principal (or such installment of principal) of the Notes becomes due and
payable whether, as applicable, by the declaration of acceleration of maturity,
notice of redemption at the option of the Trust, notice of the Holder's option
to elect repayment or otherwise.
"Name Licensing Agreement" means that certain Name Licensing Agreement
included in Part D of the Series Instrument, between Allstate Insurance Company
and the Trust, as the same may be amended, supplemented, modified, restated or
replaced from time to time.
"Nonrecourse Parties" has the meaning ascribed in Section 13.1.
"Notes" means any Secured Medium Term Notes or Allstate Life(R)
CoreNotes(R), as the case may be, issued By the Trust under the Indenture, each
in an authorized denomination and represented, individually or collectively, by
one or more Note Certificates authenticated by the Indenture Trustee pursuant to
the terms of the Indenture.
"Note Certificate" means a security certificate representing one or more
Notes.
"Note Register" has the meaning ascribed in Section 2.6(a).
"Obligations" means the obligations of the Trust secured under the Notes
and the Indenture, including (a) all principal of, any premium and interest
payable (including, without limitation, any interest which accrues after the
commencement of any case, proceeding or other action relating to the bankruptcy,
insolvency or reorganization of the Trust, whether or not allowed or allowable
as a claim in any such proceeding) on, and any Additional Amounts with respect
to, the Notes or pursuant to the Indenture, (b) all other amounts payable by the
Trust under the Indenture or under the Notes including all costs and expenses
(including attorneys' fees) incurred by the Indenture Trustee or any Holder
thereof in realizing on the Collateral to satisfy such obligations and (c) any
renewals or extensions of the foregoing.
7
"Opinion of Counsel" means an opinion in writing signed by legal counsel
who may be an employee of or counsel to the Trust or the Indenture Trustee or
who may be other counsel satisfactory to the Indenture Trustee. Each such
opinion shall include the statements provided for in Section 13.5 hereof, if and
to the extent required hereby.
"Original Issue Date" has the meaning ascribed in the Pricing Supplement.
"Outstanding" shall, subject to the provisions of Section 8.5, mean, as of
any particular time, all Notes represented by Note Certificates executed by the
Trust and authenticated and delivered by the Indenture Trustee under the
Indenture, except (a) any Note represented by a Note Certificate theretofore
cancelled by the Indenture Trustee or delivered to the Indenture Trustee for
cancellation; (b) any Note as to which funds for the full payment or redemption
of which in the necessary amount shall have been deposited in trust with the
Indenture Trustee or with any Paying Agent; provided that if such Note is to be
redeemed prior to the maturity thereof, notice of such redemption shall have
been given as provided in or pursuant to the Indenture, or provision
satisfactory to the Indenture Trustee shall have been made for giving such
notice; and (c) any Note represented by a Note Certificate in substitution for
which one or more other Note Certificates shall have been authenticated and
delivered pursuant to the terms of Section 2.5 or which shall have been paid
(unless proof satisfactory to the Indenture Trustee is presented that any of
such Note is held by a Person in whose hands such Note is a legal, valid and
binding obligation of the Trust).
"Owner" shall, with respect to each Funding Agreement, have the meaning
ascribed in such Funding Agreement.
"Paying Agent" means the Indenture Trustee in its capacity as paying agent
with respect to the Notes, and/or any other Person specified as paying agent
with respect to any Notes in the Note Certificate(s) or the Indenture, and, in
each case, its successors in such capacity.
"Person" means any natural person, corporation, limited partnership,
general partnership, joint stock company, joint venture, association, company,
limited liability company, trust (including any beneficiary thereof), bank,
trust company, land trust, trust or other organization, whether or not a legal
entity, and any government or any agency or political subdivision thereof.
"Pricing Supplement" means the pricing supplement included as Annex A to
the Series Instrument.
"Principal Amount" with respect to a Funding Agreement, has the meaning
ascribed in such Funding Agreement.
"Principal Financial Center" means, as applicable (i) the capital city of
the country issuing the Specified Currency; or (ii) the capital city of the
country to which
8
the LIBOR Currency relates; provided, however, that with respect to United
States dollars, Australian dollars, Canadian dollars, Euro, South African rands
and Swiss francs, the "Principal Financial Center" shall be The City of New
York, Sydney, Toronto, London (solely in the case of the LIBOR Currency),
Johannesburg and Zurich, respectively.
"Proceeds" means all of the proceeds of, and all other profits, products,
rents, principal payments, interest payments or other receipts, in whatever
form, arising from the collection, sale, lease, exchange, assignment, licensing
or other disposition or maturity of, or other realization upon, a Funding
Agreement, including without limitation all claims of the Trust against third
parties for loss of, damage to or destruction of, or for proceeds payable under,
such Funding Agreement, in each case whether now existing or hereafter arising.
"Program" means the program for issuance, from time to time, of Secured
Medium Term Notes and Allstate Life(R) CoreNotes(R) through Allstate Life Global
Funding Trusts, as described in the Registration Statement.
"Redemption Date" means, with respect to any Note to be redeemed, pursuant
to Section 3.1(b) or Section 3.1(c), the date of redemption of such Note
specified in the relevant notice of redemption provided to the Indenture Trustee
pursuant to Section 3.1(d).
"Redemption Price" means, with respect to the Notes, an amount equal to the
Initial Redemption Percentage specified in the Note Certificate(s) (as adjusted
by the Annual Redemption Percentage Reduction, if applicable) multiplied by the
unpaid principal amount thereof to be redeemed.
"Registrar" has the meaning ascribed in Section 2.6(a).
"Registration Statement" means the Registration Statement relating to the
Program (File No. 333-129157), filed with the Commission by the Funding
Agreement Provider and Global Funding on October 20, 2005, as amended by
Amendment No. 1 filed with the Commission on November 29, 2005, and Amendment
No. 2 filed with the Commission on -, 2006, and as it may further be amended,
supplemented, modified, restated or replaced from time to time.
"Regular Interest Record Date" has the meaning ascribed in Section 2.8(a).
"Regulation AB" has the meaning ascribed in Section 7.5.
"Repayment Date" means, with respect to any Note or portion thereof to be
repaid pursuant to Section 3.2, the date for the repayment of such Note or
portion thereof as determined by or pursuant to the Indenture or a Note
Certificate or Supplemental Indenture.
9
"Repayment Price" means, with respect to any Note or portion thereof to be
repaid pursuant to Section 3.2, the price for repayment of such Note or portion
thereof as determined by, or pursuant to, the Indenture or an applicable Note
Certificate or Supplemental Indenture.
"Responsible Officer" when used with respect to any Person means the
chairman of the board of directors or any vice chairman of the board of
directors or the president or any vice president (whether or not designated by a
number or numbers or a word or words added before or after the title "vice
president") of such Person. With respect to the Trust, Responsible Officer means
any Responsible Officer (as defined in the preceding sentence) plus any
assistant secretary and any financial services officer of the Delaware Trustee,
and with respect to the Indenture Trustee, Responsible Officer means any
Responsible Officer (as defined in the first sentence of this definition) plus
the chairman of the trust committee, the chairman of the executive committee,
any vice chairman of the executive committee, the cashier, the secretary, the
treasurer, any trust officer, any assistant trust officer, any assistant vice
president, any assistant cashier, any assistant secretary, any assistant
treasurer, or any other authorized officer of the Indenture Trustee customarily
performing functions similar to those performed by the Persons who at the time
shall be such officers, respectively, or to whom any corporate trust matter is
referred because of his knowledge of and familiarity with the particular
subject.
"Secured Parties" has the meaning ascribed in Section 14.1(a).
"Securities Act" means the Securities Act of 1933, as amended, and any
successor statute thereto, and the rules, regulations and published
interpretations of the Commission promulgated thereunder from time to time.
"Securities Intermediary" means any Person, including any Clearing
Corporation, bank or broker, that in the ordinary course of its business
maintains securities accounts for others and is acting in that capacity.
"Security Interest" has the meaning ascribed in Section 14.1(a).
"Series Instrument" means the series instrument of the Trust, pursuant to
which the Administrative Services Agreement, the Coordination Agreement, the
Funding Note Indenture, the Indenture, the Name Licensing Agreement, the Support
Agreement, the Terms Agreement and the Trust Agreement are entered into, and
certain other documents are executed, in connection with the issuance of the
Notes by the Trust.
"Special Interest Record Date" has the meaning ascribed in Section 2.8(b).
"Specified Currency" has the meaning ascribed in Section 2.4.
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"Standard Trust Terms" means those certain Standard Trust Agreement Terms,
which will be incorporated by reference in and form a part of the Trust
Agreement.
"Stated Maturity Date," means with respect to any Note, any installment of
principal thereof, or interest thereon, any premium thereon or any Additional
Amounts with respect thereto, the date established by or pursuant to the
Indenture or Note Certificate or Supplemental Indenture as the date on which the
principal of such Note or such installment of principal or interest or such
premium is, or such Additional Amounts are, due and payable.
"Supplemental Indenture" has the meaning ascribed in Section 9.1(a).
"Support Agreement" means that certain Support and Expenses Agreement
included in Part C of the Series Instrument, by and between the Funding
Agreement Provider and the Trust, as the same may be amended, supplemented,
modified, restated or replaced from time to time.
"Target System" means the Trans-European Automated Real Time Gross
Settlement Express Transfer (TARGET) System.
"Tax Event" has the meaning ascribed in Section 3.1(c).
"Terms Agreement" means that certain Terms Agreement included in Part E of
the Series Instrument, by and among Global Funding, the Trust and each Agent
named therein, which will incorporate by reference the terms of the Distribution
Agreement.
"Trust" means the Allstate Life Global Funding Trust specified in the
Series Instrument, together with its permitted successors and assigns.
"Trust Agreement" means that certain Trust Agreement included in Part A of
the Series Instrument, among the Delaware Trustee, the Administrator and the
Trust Beneficial Owner.
"Trust Beneficial Owner" means Global Funding, in its capacity as the sole
beneficial owner of the Trust, and its successors.
"Trust Certificate" means a certificate signed by the Administrator on
behalf of the Trust and delivered to the Indenture Trustee. Each such
certificate shall include the statements provided for in Section 13.5.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended,
and any successor statute thereto, and the rules, regulations and published
interpretations of the Commission promulgated thereunder from time to time.
11
"UCC" means the Uniform Commercial Code, as from time to time in effect in
the State of New York; provided that, with respect to the perfection, effect of
perfection or non-perfection, or priority of any security interest in the
Collateral, "UCC" shall mean the applicable jurisdiction whose law governs such
perfection, non-perfection or priority.
"United States", except as otherwise provided in or pursuant to the
Indenture or any Note Certificate, means the United States of America (including
the states thereof and the District of Columbia), its territories and
possessions and other areas subject to its jurisdiction.
"United States Dollars", "U.S. Dollars" or "$" means lawful currency of the
United States.
SECTION 1.2 Interpretation. For all purposes of the Indenture except as
otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article shall have the meanings
ascribed to them in this Article and shall include the plural as
well as the singular;
(b) all accounting terms used and not expressly defined shall have
the meanings given to them in accordance with United States
generally accepted accounting principles, and the term "generally
accepted accounting principles" shall mean such accounting
principles which are generally accepted at the date or time of
any computation or at the date of the Indenture;
(c) references to Exhibits, Articles, Sections, paragraphs,
subparagraphs and clauses shall be construed as references to the
Exhibits, Articles, Sections, paragraphs, subparagraphs and
clauses of the Indenture;
(d) the words "include", "includes" and "including" shall be
construed to be followed by the words "without limitation"; and
(e) Article and Section headings are for the convenience of the
reader and shall not be considered in interpreting the Indenture
or the intent of the parties.
ARTICLE 2
THE NOTES
SECTION 2.1 Amount Unlimited. The aggregate principal amount of Notes that
may be authenticated and delivered under the Indenture shall be the principal
amount of the Notes set forth in the Pricing Supplement.
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SECTION 2.2 Status of Notes. The Notes constitute direct, unconditional,
unsubordinated and secured non-recourse obligations of the Trust and rank
equally among themselves.
SECTION 2.3 Forms Generally.
(a) The Note Certificates, shall be in, or substantially in, the form
set forth in Exhibit A-1, Exhibit A-2, Exhibit A-3 and Exhibit
A-4 attached hereto, as applicable, in each case with such
appropriate insertions, omissions, substitutions and other
variations as are required or permitted by the Indenture or as
may in the Trust's judgment be necessary, appropriate or
convenient to permit the Notes to be issued and sold, or to
comply, or facilitate compliance, with applicable laws, and may
have such letters, numbers or other marks of identification and
such legends or endorsements placed thereon as may be required to
comply with the rules of any securities exchange on which the
Notes may be listed, or as may, consistently herewith, be
determined by the Responsible Officer of the Trust executing such
Note Certificates, with the approval of the Indenture Trustee, as
evidenced by his or her execution thereof.
(b) Note Certificates may be printed, lithographed, engraved,
typewritten, photocopied or otherwise produced in any manner as
the Responsible Officer of the Trust executing such Notes may
determine.
(c) The terms and provisions contained in the Note Certificates and
in any Supplemental Indenture shall constitute, and are expressly
made, a part of the Indenture and, to the extent applicable, the
Trust and the Indenture Trustee, by their execution and delivery
of the Indenture, expressly agree to such terms and provisions
and to be bound thereby.
SECTION 2.4 Currency; Denominations.
(a) Unless otherwise specified in the Note Certificates or in any
Supplemental Indenture, Notes will be denominated in, and
payments of principal of, premium and interest on, and Additional
Amounts in respect to, the Notes will be made in, U.S. dollars.
The currency in which the Notes are denominated (or, if such
currency is no longer legal tender for the payment of public and
private debts in the country issuing such currency or, in the
case of Euro, in the member states of the European Union that
have adopted the single currency in accordance with the Treaty
13
establishing the European Community, as amended by the Treaty on
European Union, such currency which is then such legal tender) is
in the Indenture referred to as the "Specified Currency".
(b) Unless otherwise provided in or pursuant to the Indenture, the
Trust appoints the Indenture Trustee as Exchange Rate Agent with
respect to the Notes and the Indenture Trustee accepts such
appointment.
(c) Unless otherwise specified in the Note Certificates or in a
Supplemental Indenture, Notes shall be issued in minimum
denominations of $1,000 and integral multiples of $1,000 in
excess thereof or equivalent denominations in other currencies.
(d) The Trust may (if so specified in a Note Certificate or
Supplemental Indenture) without the consent of the Holder of any
Note, redenominate all, but not less than all, of the Notes on or
after the date on which the member state of the European Union in
whose national currency the Notes are denominated has become a
participant member in the third stage of the European economic
and monetary union as more fully set out in a Note Certificate or
Supplemental Indenture.
(e) Unless otherwise specified in a Note Certificate or Supplemental
Indenture, if the Specified Currency of the Notes is other than
U.S. Dollars, the Trust shall not sell the Notes in, or to
residents of, the country issuing such Specified Currency.
SECTION 2.5 Execution, Authentication, Delivery and Date.
(a) Each Note Certificate shall be executed on behalf of the Trust by
any Responsible Officer of the Delaware Trustee. The signature of
any Responsible Officer of the Delaware Trustee may be manual, in
facsimile form, imprinted or otherwise reproduced and may, but
need not, be attested.
(b) Each Note Certificate bearing the signature of a Person who was
at any time a Responsible Officer of the Delaware Trustee shall
bind the Trust, notwithstanding that such Person has ceased to
hold such office prior to the authentication and delivery of such
Note Certificate or did not hold such office at the date of such
Note Certificate.
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(c) At any time, and from time to time, after the execution and
delivery of the Indenture, the Trust may deliver Note
Certificates executed by or on behalf of the Trust to the
Indenture Trustee for authentication, and the Indenture Trustee
shall thereupon authenticate and deliver such Note Certificates
as provided in the Indenture and not otherwise.
(d) The Indenture Trustee shall have the right to decline to
authenticate and deliver any Note Certificates under this Section
if the Indenture Trustee has obtained an Opinion of Counsel
reasonably acceptable to the Trust, to the effect that the
issuance of the Notes will adversely affect the Indenture
Trustee's own rights, duties or immunities under the Indenture.
(e) The Note Certificates shall be dated the date of their
authentication.
(f) No Note shall be entitled to any benefit under the Indenture or
be valid or obligatory for any purpose, unless there appears on
the Note Certificate representing such Note a certificate of
authentication substantially in the form attached as Exhibit B
executed by the Indenture Trustee by manual signature of one of
its authorized signatories. Such certificate upon any Note
Certificate shall be conclusive evidence, and the only evidence,
that such Note Certificate has been duly authenticated and
delivered under the Indenture.
SECTION 2.6 Registration, Transfer and Exchange.
(a) The Indenture Trustee will serve initially as registrar (in such
capacity, and together with any successor registrar, the
"Registrar") for the Notes. In such capacity, the Indenture
Trustee will cause to be kept at the Corporate Trust Office of
the Indenture Trustee a register (the "Note Register") in which,
subject to such reasonable regulations as it may prescribe, the
Indenture Trustee will provide for the registration of the Notes
and of transfers of the Notes. The Note Register shall be in
written form in the English language or in any other form capable
of being converted into such form within a reasonable time.
(b) Subject to Section 2.10, upon surrender of a Note Certificate for
registration of transfer of any Note represented thereby,
together with the form of transfer endorsed thereon duly
completed and executed, at the designated office of the Registrar
or of any applicable transfer agent, each as provided in a Note
Certificate
15
or Supplemental Indenture, the Delaware Trustee, on behalf of the
Trust shall execute, and the Indenture Trustee shall authenticate
and deliver, in the name of the designated transferee or
transferees, one or more new Note Certificates representing an
aggregate principal amount of Notes equal to the aggregate
principal amount of the Notes represented by such Note
Certificate surrendered for registration of transfer.
(c) Subject to Section 2.10, at the option of the applicable Holder,
any Note Certificate may be exchanged for one or more new Note
Certificates, and any two or more Note Certificates may be
consolidated into and exchanged for a single Note Certificate or
fewer than the number of Note Certificates duly presented for
exchange, in each case representing one or more Notes in an
aggregate principal amount equal to the aggregate principal
amount of the Notes represented by the Note Certificate or Note
Certificates duly presented for exchange. Each Note Certificate
to be exchanged shall be surrendered at the designated office of
the Registrar or of any applicable transfer agent, each as
provided in a Note Certificate or Supplemental Indenture.
Whenever any Note Certificate is so surrendered for exchange, the
Delaware Trustee, on behalf of the Trust shall execute, and the
Indenture Trustee shall authenticate and deliver, the Note
Certificate or Note Certificates which the applicable Holder is
entitled to receive, bearing numbers, letters or other
designating marks not contemporaneously outstanding.
(d) Each Note Certificate executed, authenticated and delivered upon
any transfer or exchange shall be a valid obligation of the
Trust, evidencing the same debt, and entitled to the same
benefits under the Indenture, as the Note Certificates
surrendered in connection with any such transfer or exchange.
Upon surrender, transfer or exchange of a Note Certificate
pursuant to this Section 2.6, each new Note Certificate will,
within three Business Days of the receipt of the applicable form
of transfer or the applicable surrender, as the case may be, be
delivered to the designated office of the Registrar or of any
applicable transfer agent, each as provided in a Note Certificate
or Supplemental Indenture, or mailed at the risk of the Person
entitled to such Note Certificate to such address as may be
specified in the form of transfer or in written instructions of
the applicable Holder upon surrender for exchange.
(e) Every Note Certificate presented or surrendered in connection
with any transfer or exchange shall (if so required by the Trust
or
16
the Indenture Trustee) be duly endorsed, or be accompanied by a
written instrument of transfer in form satisfactory to the Trust
and the Indenture Trustee duly executed by, the applicable Holder
or his attorney duly authorized in writing.
(f) No service charge shall be made in connection with any transfer
of Notes or exchange of Note Certificates, but the Trust or the
Indenture Trustee may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in
connection with any transfer of Notes or exchange of Note
Certificates.
(g) Except as otherwise provided in or pursuant to the Indenture, the
Trust and the Indenture Trustee shall not be required to (i) upon
presentation or surrender of a Note Certificate in connection
with any transfer or exchange during a period beginning at the
opening of business 15 days before the day of the selection for
redemption of Notes under Section 3.1 and ending at the close of
business on the day of such selection, exchange any Note
Certificate representing any Note selected for redemption,
register the transfer of any such Note, or portion thereof,
except in the case of any Note to be redeemed in part, with
respect to the portion of such Note not to be redeemed, or (ii)
exchange any Note Certificate representing any Note the Holder or
Holders of which shall have exercised the option pursuant to
Section 3.2 to require the Trust to repay any such Note prior to
its Stated Maturity Date or register the transfer of any such
Note except, in the case of any Note to be repaid in part, with
respect to the portion of such Note not to be repaid.
SECTION 2.7 Mutilated, Destroyed, Lost or Stolen Note Certificates.
(a) If (i) any Note Certificate is mutilated and is surrendered to
the Indenture Trustee or the Trust, or the Indenture Trustee and
the Trust receive evidence to their satisfaction of the
destruction, loss or theft of any Note Certificate, and (ii)
there is delivered to the Trust and the Indenture Trustee such
security or indemnity as may be required by them to save each of
them harmless, then, in the absence of notice to the Trust or the
Indenture Trustee that such Note Certificate has been acquired by
a protected purchaser, the Trust shall execute and upon its
request the Indenture Trustee shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Note Certificate, a new Note Certificate representing
Notes of like tenor and principal amount, bearing a number not
contemporaneously outstanding.
17
(b) If any Note represented by any such mutilated or apparently
destroyed, lost or stolen Note Certificate has become or is about
to become due and payable, the Trust in its discretion may,
instead of issuing a new Note Certificate, pay such amounts in
respect of the Notes represented by such Note Certificate.
(c) Upon the execution, authentication and delivery of any new Note
Certificate under this Section, the Indenture Trustee or the
Trust may require the Holder to pay a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses
of the Indenture Trustee) connected therewith.
(d) The Notes represented by every Note Certificate executed,
authenticated and delivered pursuant to this Section in lieu of
any apparently destroyed, lost or stolen Note Certificate shall
constitute an original additional contractual obligation of the
Trust, whether or not any obligation with respect to the Notes
represented by the apparently destroyed, lost or stolen Note
Certificate shall be at any time enforceable by any Person, and
shall be entitled to all of the benefits of the Indenture equally
and proportionately with any and all other Notes duly issued
under the Indenture.
(e) The provisions of this Section are exclusive with respect to the
replacement of any mutilated or apparently destroyed, lost or
stolen Note Certificate or the payment of the Notes represented
thereby and shall preclude all other rights and remedies with
respect to the replacement of any mutilated or apparently
destroyed, lost or stolen Note Certificate or the payment of the
Notes represented thereby.
SECTION 2.8 Interest Record Dates.
(a) Interest on and Additional Amounts with respect to any Note which
is payable, on any interest payment date specified in the Note
Certificates or in any Supplemental Indenture (each such date, an
"Interest Payment Date") shall be paid to the Holder of such Note
at the close of business on the date specified as the regular
interest record date in the Note Certificates or Supplemental
Indenture (the "Regular Interest Record Date") or, if no such
date is specified, the date that is 15 calendar days preceding
such Interest Payment Date.
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(b) Unless otherwise provided in the Note Certificates or in any
Supplemental Indenture, any interest on, and any Additional
Amounts with respect to, any Note which is payable, but is not
punctually paid or duly provided for, on any Interest Payment
Date specified in the Note Certificates or Supplemental Indenture
(the "Defaulted Interest") shall forthwith cease to be payable to
the Holder of such Note on the relevant Regular Interest Record
Date by virtue of having been such Holder, and such Defaulted
Interest shall be paid by the Trust to the Holder of such Note at
the close of business on a special record date (the "Special
Interest Record Date") established by the Trust by notice to each
applicable Holder and the Indenture Trustee in accordance with
Section 13.4, which Special Interest Record Date shall be not
more than 15 nor less than 10 days prior to the date of the
proposed payment of Defaulted Interest and not less than 10 days
after the receipt by the Indenture Trustee of the notice of the
proposed payment of Defaulted Interest.
SECTION 2.9 Cancellation. Each Note Certificate surrendered for exchange or
in connection with any payment, redemption, transfer of any Note represented
thereby shall be delivered to the Indenture Trustee and, if not already
cancelled, shall be promptly cancelled by it. The Trust may at any time deliver
to the Indenture Trustee for cancellation any Note Certificate previously
authenticated and delivered under the Indenture which the Trust may have
acquired in any manner whatsoever, and each Note Certificate so delivered shall
be promptly cancelled by the Indenture Trustee. No Note Certificates shall be
authenticated in lieu of or in exchange for any Note Certificate cancelled as
provided in this Section, except as expressly permitted by the Indenture. The
Indenture Trustee shall destroy all cancelled Note Certificates held by it and
deliver a certificate of destruction to the Trust. If the Trust shall acquire
any of the Notes, such acquisition shall not operate as a redemption or
satisfaction of the indebtedness represented by such Notes unless and until each
Note Certificate representing such Notes is delivered to the Indenture Trustee
for cancellation.
SECTION 2.10 Global Securities.
(a) Unless (i) permitted by applicable law and (ii) an Exchange Event
shall have occurred and be continuing with respect to Book-Entry
Notes represented by one or more Global Securities, no Book-Entry
Note represented by any such Global Security shall be
exchangeable for Certificated Notes.
(b) For purposes of the Indenture, the term "Exchange Event" means
any of the following:
19
(i) the Depositary with which any Global Security is deposited
shall have notified the Trust that it is unwilling or unable
to continue as the Depositary for any Global Security or the
Trust becomes aware that the Depository has ceased to be a
clearing agency registered under the Exchange Act and, in
any such case, the Trust fails to appoint a successor to the
Depositary within 60 calendar days;
(ii) Subject to the procedures of the DTC, the Trust, in its sole
discretion, determines that the Notes should no longer be
represented solely by one or more Global Securities; or
(iii) an Event of Default shall have occurred and be continuing
with respect to the Notes and the maturity of the Notes
shall have been accelerated in accordance with the terms of
the Indenture and the Notes.
(c) If any Exchange Event shall have occurred and be continuing,
then:
(i) with respect to each Global Security deposited with, and
registered in the name of, the applicable Depositary or its
nominee, the Delaware Trustee, on behalf of the Trust shall
promptly, and in any event not later than 10 Business Days
after the occurrence of such Exchange Event, cause to be
executed, authenticated and delivered to the applicable
Depositary or its nominee, against surrender by the
applicable Depositary or its nominee of such Global
Security, which shall thereupon be cancelled by the
Indenture Trustee, a Definitive Security or a Definitive
Securities each representing such number of Notes as may be
specified by the applicable Depositary in an aggregate
principal amount equal to the (Outstanding principal amount
of Notes that shall have been represented by such Global
Security and shall register the Certificated Notes in such
names and in such authorized denominations as may be
specified by the Depositary for the Global Security; and
(ii) if any Certificated Note is issued in exchange for any
portion of or all Book-Entry Notes represented by a Global
Security after the close of business at the office or agency
for such Note where such exchange occurs on (A) any Regular
Interest Record Date for such Notes and
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before the opening of business at such office or agency on
the next Interest Payment Date, or (B) any Special Interest
Record Date for such Notes and before the opening of
business at such office or agency on the related proposed
date for payment of interest, any Additional Amounts or
Defaulted Interest, as the case may be, interest, Additional
Amounts or Defaulted Interest, as the case may be, shall not
be payable on such Interest Payment Date or proposed date
for payment, as the case may be, in respect of such Notes,
but shall be payable on such Interest Payment Date or
proposed date for payment, as the case may be, only to the
Person to whom interest and any Additional Amounts or
Defaulted Interest, as applicable, in respect of such
portion of or all Book-Entry Notes, as the case may be,
represented by such Global Security shall be payable in
accordance with the provisions of the Indenture.
(d) The Certificated Notes issued in exchange for any Book-Entry
Notes represented by a Global Security shall be of like tenor and
of an equal aggregate principal amount, in authorized
denominations. Such Certificated Notes shall be registered in the
name or names of such person or persons as the applicable
Depository shall instruct the Registrar.
SECTION 2.11 Withholding Tax. All amounts due in respect of the Notes will
be made without withholding or deduction for or on account of any present or
future taxes, duties, levies, assessments or other governmental charges of
whatever nature imposed or levied by or on behalf of any governmental authority
in the United States having the power to tax payments on the notes unless the
withholding or deduction is required by law. Unless otherwise specified in the
Note Certificate(s), the Trust will not pay any Additional Amounts to Holders of
Notes in the event that any withholding or deduction is so required by law,
regulation or official interpretation thereof, and the imposition of a
requirement to make any such withholding or deduction will not give rise to any
independent right or obligation to redeem or repay the Notes and shall not
constitute an Event of Default.
SECTION 2.12 Tax Treatment. The parties agree, and each Holder and
beneficial owner of Notes by purchasing the Notes agrees, for all United States
Federal, state and local income and franchise tax purposes (i) to treat the
Notes as indebtedness of the Funding Agreement Provider, (ii) Global Funding and
the Trust will be ignored and will not be treated as an association or a
publicly traded partnership taxable as a corporation and (iii) to not take any
action inconsistent with the treatment described in (i) and (ii) unless
otherwise required by law.
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ARTICLE 3
REDEMPTION, REPAYMENT AND REPURCHASE OF NOTES; SINKING FUNDS
SECTION 3.1 Redemption of Notes.
(a) Redemption of Notes by the Trust as permitted or required by the
Indenture and the Note Certificate(s) will be made in accordance
with the terms of the Notes and (except as otherwise provided in
the Indenture or pursuant to the Indenture) this Section.
(b) If any Initial Redemption Date is specified in the Note
Certificate(s), the Trust may redeem Notes prior to the Stated
Maturity Date at its option, on, or on any Business Day after,
the Initial Redemption Date in whole or from time to time in part
in increments of $1,000 or any other integral multiple of an
authorized denomination of the Notes at the applicable Redemption
Price together with any unpaid interest accrued thereon, any
Additional Amounts and other amounts payable with respect
thereto, as of the Redemption Date.
(c) If (i) the Trust is required at any time to pay Additional
Amounts or if the Trust is obligated to withhold or deduct any
United States taxes with respect to any payment under the Notes,
as set forth in the Note Certificate(s), or if there is a
material probability that the Trust will become obligated to
withhold or deduct any such United States taxes or otherwise pay
Additional Amounts (in the opinion of independent legal counsel
selected by the Funding Agreement Provider), in each case
pursuant to any change in or amendment to any United States tax
laws (or any regulations or rulings thereunder) or any change in
position of the Internal Revenue Service regarding the
application or interpretation thereof (including, but not limited
to, the Funding Agreement Provider's or the Trust's receipt of a
written adjustment from the Internal Revenue Service in
connection with an audit) (a "Tax Event"), and (ii) the Funding
Agreement Provider, pursuant to the terms of the relevant Funding
Agreement, has delivered to the Owner notice that the Funding
Agreement Provider intends to terminate the relevant Funding
Agreement pursuant to the terms of such Funding Agreement, then
the Trust will redeem the Notes on the Redemption Date at the
Redemption Price together with any unpaid interest accrued
thereon, any Additional Amounts and other amounts payable with
respect thereto, as of the Redemption Date.
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(d) Unless a shorter notice shall be satisfactory to the Indenture
Trustee, the Trust shall provide to the Indenture Trustee a
notice of redemption of any Notes (i) in case of any redemption
at the election of the Trust, not more than 60 days nor less than
35 days prior to the Redemption Date and (ii) in case of any
mandatory redemption pursuant to Section 3.1(c), at least 75 days
prior to the Redemption Date. In case of any redemption at the
election of the Trust of less than all of the Notes such notice
shall specify the aggregate principal amount of the Notes to be
redeemed.
(e) If less than all of the Notes are to be redeemed at the option of
the Trust, the particular Notes to be redeemed shall be selected
not more than 60 days prior to the Redemption Date by the
Indenture Trustee from the Outstanding Notes not previously
called for redemption, by such method as the Indenture Trustee
shall deem fair and appropriate, acting in accordance with its
obligations under the Indenture, and which may provide for the
selection for redemption of portions of the principal amount of
Notes; provided, however, that no such partial redemption shall
reduce the portion of the principal amount of a Note not redeemed
to less than the minimum denomination for a Note established in
or pursuant to the Indenture; provided further, that if at the
time of redemption such Notes are registered as Global
Securities, the Depositary shall determine, in accordance with
its procedures, the principal amount of such Notes to be redeemed
by each of the Depositary's participants. The Indenture Trustee
shall promptly notify the Trust and the Registrar (if other than
itself) in writing of the Notes selected for redemption and, in
the case of any Notes selected for partial redemption, of the
aggregate principal amount thereof to be redeemed. For all
purposes of the Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Notes shall relate,
in the case of any Notes redeemed or to be redeemed only in part,
to the portion of the principal of such Notes which has been or
is to be redeemed.
(f) Unless otherwise specified in the Indenture or the Note
Certificate(s) the Trust shall give a notice of redemption to
each Holder of the Notes to be redeemed at the Trust's option (i)
in case of any redemption at the election of the Trust, not more
than 60 days nor less than 30 days prior to the Redemption Date
and (ii) in case of any mandatory redemption pursuant to Section
3.1(c), not more than 75 days nor less than 30 days prior to the
Redemption Date; provided, that in the case of any notice of
redemption given pursuant to clause (ii) no such notice of
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redemption may be given earlier than 90 days prior to the
earliest day on which the Trust would become obligated to pay the
applicable Additional Amounts were a payment in respect of Notes
then due. Failure to give such notice to the Holder of any Note
designated for redemption in whole or in part, or any defect in
the notice to any such Holder, shall not affect the validity of
the proceedings for the redemption of any other Note or any
portion thereof.
Any notice that is mailed to the Holder of any Notes in the manner provided
for in Section 13.4 shall be conclusively presumed to have been duly given,
whether or not such Holder receives the notice.
All notices of redemption shall state:
(i) the Redemption Date,
(ii) the Redemption Price or, if not then ascertainable, the
manner of calculation thereof,
(iii) in case of any redemption at the election of the Trust, if
less than all Outstanding Notes are to be redeemed, the
identification (and, in the case of partial redemption, the
principal amount) of the particular Note or Notes to be
redeemed,
(iv) in case any Note is to be redeemed in part only at the
election of the Trust, the notice which relates to such Note
shall state that on and after the Redemption Date, upon
surrender of the Note Certificate representing such Note,
the Holder of such Note will receive, without charge, a new
Note Certificate representing an authorized denomination of
the principal amount of such Note remaining unredeemed,
(v) that, on the Redemption Date, the Redemption Price shall
become due and payable upon each such Note or portion
thereof to be redeemed, and, if applicable, that interest
thereon shall cease to accrue on and after the Redemption
Date, the place or places where each Note Certificate
representing such Note or Notes is to be surrendered for
payment of the Redemption Price together with any unpaid
interest accrued thereon through the Redemption Date and any
Additional Amounts payable with respect thereto,
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(vi) if applicable, in case of any redemption at the election of
the Trust, that the redemption is for a sinking fund, and
(vii) the CUSIP number or any other numbers used to identify such
Notes.
(g) On or prior to any Redemption Date, the Trust shall deposit, with
respect to any Notes called for redemption pursuant to this
Section, with the Paying Agent an amount of money in the
Specified Currency sufficient to pay the Redemption Price of, and
(except if the Redemption Date shall be an Interest Payment Date,
unless otherwise specified in the Note Certificate(s)) any unpaid
interest accrued through the Redemption Date on, and any
Additional Amounts payable with respect to, all such Notes or
portions thereof which are to be redeemed on the Redemption Date.
(h) On the Redemption Date, the Notes to be redeemed shall become due
and payable at the Redemption Price together with any unpaid
interest accrued through the Redemption Date on, and any
Additional Amounts payable with respect to, such Notes, and from
and after such date (unless the Trust shall default in the
payment of the Redemption Price and any unpaid interest accrued
on such Notes through the Redemption Date) such Notes shall cease
to bear interest. Upon surrender of any Note Certificate for
redemption of any Note or Notes represented thereby in accordance
with the applicable notice of redemption, such Note shall be paid
by the Trust at the Redemption Price, together with any unpaid
interest accrued thereon through the Redemption Date and any
Additional Amounts payable with respect thereto.
(i) If any Note called for redemption shall not be so paid upon
surrender of the applicable Note Certificate for redemption, the
principal and any premium, until paid, shall bear interest from
the Redemption Date at the rate specified in the Note
Certificate(s).
Upon surrender of any Note Certificate for partial redemption of any Note
or Notes represented thereby in accordance with this Section, the Trust shall
execute and the Indenture Trustee shall authenticate and deliver one or more new
Note Certificates of any authorized denomination representing an aggregate
principal amount of Notes equal to the unredeemed portion of the applicable Note
or Notes.
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SECTION 3.2 Repayment at the Option of the Holder.
(a) If so specified in the Note Certificate(s), the Holder or Holders
of the Notes may require the Trust to repay the Notes prior to
the Stated Maturity Date in whole or from time to time in part in
increments of $1,000 or any other integral multiple of an
authorized denomination specified in the Note Certificate(s)
(provided that any remaining principal amount thereof shall be at
least $1,000 or other minimum authorized denomination applicable
thereto).
(b) Notes which are repayable at the option of the Holder or Holders
thereof before the Stated Maturity Date shall be repaid in
accordance with the terms of the Notes.
(c) The repayment of any principal amount of Notes pursuant to any
option of the applicable Holder or Holders to require repayment
of any Notes before the Stated Maturity Date shall not operate as
a payment, redemption or satisfaction of the indebtedness
represented by such Notes unless and until the Trust, at its
option, shall deliver or surrender each Note Certificate
representing such Notes to the Indenture Trustee with a directive
that such Note Certificates be cancelled.
(d) Notwithstanding anything to the contrary contained in this
Section, in connection with any repayment of Notes, the Trust may
arrange for the purchase of any Notes by an agreement with one or
more investment bankers or other purchasers to purchase such
Notes by paying the Holder or Holders of such Notes on or before
the close of business on the Repayment Date an amount not less
than the Repayment Price payable by the Trust on repayment of
such Notes, and the obligation of the Trust to pay the Repayment
Price of such Notes shall be satisfied and discharged to the
extent such payment is so paid by such purchasers.
(e) Any exercise of the repayment option will be irrevocable.
SECTION 3.3 Repurchase of Notes.
(a) The Trust may purchase some or all Notes in the open market or
otherwise at any time, and from time to time, with the prior
written consent of the Funding Agreement Provider as to both the
making of such purchase and the purchase price to be paid for
such Notes.
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(b) If the Funding Agreement Provider, in its sole discretion,
consents to such purchase of Notes by the Trust, the parties to
the Indenture agree to take such actions as may be necessary or
desirable to effect the prepayment of such portion, or the
entirety, of the current Principal Amount, under each applicable
Funding Agreement as may be necessary to provide for the payment
of the purchase price for such Notes. Upon such payment, the
Principal Amount under each Funding Agreement shall be reduced
(i) if Notes bear interest at fixed or floating rates, by an
amount equal to the aggregate principal amount of Notes so
purchased (or the portion thereof applicable to such Funding
Agreement) and (ii) if Notes do not bear interest at fixed or
floating rates, by an amount to be agreed between the Trust and
the Funding Agreement Provider to reflect such prepayment under
the Funding Agreement(s).
(c) The parties acknowledge and agree that (i) notwithstanding
anything to the contrary in the Indenture, any repurchase of
Notes in compliance with this Section 3.3 shall not violate any
provision of the Indenture or the Trust Agreement and (ii) no
Opinion of Counsel, Trust Certificate or any other document or
instrument shall be required to be provided in connection with
any repurchase of Notes pursuant to this Section 3.3.
(d) If applicable, the Trust will comply with the requirements of
Section 14(e) of the Exchange Act, and the rules promulgated
thereunder, and any other applicable securities laws or
regulations in connection with any repurchase pursuant to this
Section 3.3.
SECTION 3.4 Sinking Funds.
Unless otherwise provided in the Note Certificate(s), the Notes will not be
subject to, or entitled to the benefit of, any sinking fund.
ARTICLE 4
PAYMENTS; PAYING AGENTS AND CALCULATION AGENT; COVENANTS
SECTION 4.1 Payment of Principal and Interest.
(a) The Trust will duly and punctually pay or cause to be paid the
principal of, any premium and interest on, and any Additional
Amounts with respect to, each of the Notes, in accordance with
the terms of the Notes and the Indenture.
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(b) Unless otherwise specified in the Note Certificate(s), upon the
receipt of the funds necessary therefor, the applicable Paying
Agent shall duly and punctually make payments, payable on the
Maturity Date, of principal in respect of, any premium and
interest on, and any Additional Amounts payable with respect to,
any Certificated Notes in immediately available funds against
presentation and surrender of the applicable Definitive Security
(and in the case of any repayment of a Note pursuant to Section
3.2, upon submission of a duly completed election form at an
office or agency of such Paying Agent maintained for such purpose
pursuant to Section 4.3). The applicable Paying Agent (unless
such Paying Agent is the Indenture Trustee) shall promptly
forward each Definitive Security surrendered to it in connection
with any payment pursuant to this Section for cancellation in
accordance with Section 2.9. Unless otherwise specified in the
Note Certificate(s), upon the receipt of the funds necessary
therefor, the applicable Paying Agent shall duly and punctually
make payments of principal of, any premium and interest on, and
any Additional Amounts in respect of, Certificated Notes payable
on any date other than the Maturity Date by check mailed to the
Holder (or to the first named of joint Holders) of such
Certificated Note at the close of business on the Regular
Interest Record Date or Special Interest Record Date, as the case
may be, at its address appearing in the applicable Note Register.
Notwithstanding the foregoing, the applicable Paying Agent shall
make payments of principal, any interest, any premium, and any
Additional Amounts on any date other than the Maturity Date to
each Holder entitled thereto (or to the first named of joint
Holders) at the close of business on the applicable Regular
Interest Record Date or Special Interest Record Date, as the case
may be, of $10,000,000 (or, if the Specified Currency is other
than United States dollars, the equivalent thereof in the
particular Specified Currency) or more in aggregate principal
amount of Certificated Notes by wire transfer of immediately
available funds if the applicable Holder has delivered
appropriate wire transfer instructions in writing to the
applicable Paying Agent not less than 15 days prior to the date
on which the applicable payment of principal, interest, premium
or Additional Amounts is scheduled to be made. Any wire transfer
instructions received by the applicable Paying Agent shall remain
in effect until revoked by the applicable Holder.
(c) Unless otherwise specified in the Note Certificate(s), upon
receipt of the funds necessary therefor, on the Maturity Date the
applicable Paying Agent shall (in the absence of any other
28
arrangements between the applicable Paying Agent and the
applicable Holder) duly and punctually make payments, payable on
the Maturity Date, of principal in respect of, any premium and
interest payable on, and any Additional Amounts with respect to,
any Book-Entry Notes to the account of the Depositary or its
nominee at the close of business on the applicable Maturity Date.
The applicable Paying Agent (unless such Paying Agent is the
Indenture Trustee) shall promptly forward to the Indenture
Trustee each Global Security surrendered to it in connection with
any payment pursuant to this section for cancellation in
accordance with Section 2.9. Unless otherwise specified in the
Note Certificate(s), upon the receipt of the funds necessary
therefor in accordance with Section 4.5(b), the applicable Paying
Agent shall duly and punctually make payments of principal of,
any premium and interest on, and any Additional Amounts in
respect of, any Book-Entry Notes payable on any date other than
the Maturity Date to the Holder of such Book-Entry Notes by 11:00
a.m. (New York City time) on the applicable Regular Interest
Record Date or Special Interest Record Date, as the case may be,
to the account of the Depositary or its nominee.
(d) Unless otherwise specified in the Note Certificate(s), the Trust
shall be obligated to make, or cause to be made, payments of
principal of, any premium and interest on, and any Additional
Amounts with respect to, a Foreign Currency Note in the Specified
Currency. Any amounts so payable by the Trust in the Specified
Currency will be converted by the Exchange Rate Agent into United
States dollars for payment to the Holder or Holders thereof
unless otherwise specified in the Note Certificate(s) or a Holder
elects to receive such amounts in the Specified Currency as
provided below.
(e) Unless otherwise specified in the Note Certificate(s), any United
States dollar amount to be received by the Holder or Holders of
Foreign Currency Notes will be based on the highest bid quotation
in The City of New York received by the Exchange Rate Agent at
approximately 11:00 a.m. (New York City time) on the second
Business Day preceding the applicable payment date from three
recognized foreign exchange dealers (one of whom may be the
Exchange Rate Agent) selected by the Exchange Rate Agent and
approved by the Trust for the purchase by the quoting dealer of
the Specified Currency for United States dollars for settlement
on that payment date in the aggregate amount of the Specified
Currency payable to the Holder or Holders of Foreign Currency
Notes scheduled to receive United States dollar
29
payments and at which the applicable dealer commits to execute a
contract. All currency exchange costs will be borne by the
relevant Holder or Holders of Foreign Currency Notes by
deductions from any payments. If three bid quotations are not
available, payments will be made in the Specified Currency.
(f) Holders of Foreign Currency Notes may elect to receive all or a
specified portion of any payment of principal and/or any
interest, premium and Additional Amounts in the Specified
Currency by submitting a written request to the Indenture Trustee
at its Corporate Trust Office in The City of New York on or prior
to the applicable Regular Interest Record Date or Special
Interest Record Date or at least 15 calendar days prior to the
Maturity Date, as the case may be. Such written request may be
mailed or hand delivered or sent by cable, telex or other form of
facsimile transmission. Such election will remain in effect until
revoked by written notice delivered to the Indenture Trustee on
or prior to the applicable Regular Interest Record Date or
Special Interest Record Date or at least 15 calendar days prior
to the Maturity Date, as the case may be.
(g) Unless otherwise specified in the Note Certificate(s), an
Entitlement Holder with respect to a Foreign Currency Note
represented by a Global Security which elects to receive payments
of principal, and/or any interest, premium and Additional Amounts
in the Specified Currency must notify the applicable Depositary's
participant through which it owns its interest on or prior to the
applicable Regular Interest Record Date or Special Interest
Record Date, or at least 15 calendar days prior to the Maturity
Date, as the case may be, of its election. The applicable
participant must notify the Depositary of such election on or
prior to the third Business Day after the applicable Regular
Interest Record Date or Special Interest Record Date, or at least
12 calendar days prior to the Maturity Date, as the case may be,
and the Depositary will notify the Indenture Trustee of that
election on or prior to the fifth Business Day after the
applicable Regular Interest Record Date or Special Interest
Record Date, or at least 10 calendar days prior to the Maturity
Date, as the case may be. If complete instructions are received
by the applicable Depositary's participant from the applicable
Entitlement Holder and forwarded by the participant to the
Depositary, and by the Depositary to the Indenture Trustee, on or
prior to such dates, then the applicable Entitlement Holder will
receive payments in the Specified Currency.
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(h) Notwithstanding anything to the contrary in this Indenture, if
the Specified Currency for Foreign Currency Notes is not
available for any required payment of principal and/or any
interest, premium and Additional Amounts due to the imposition of
exchange controls or other circumstances beyond the Trust's
control, the Trust will be entitled to satisfy its obligations
with respect to such Foreign Currency Notes by making, or causing
to be made, payments in United States dollars based on the Market
Exchange Rate computed by the Exchange Rate Agent on the second
Business Day prior to the particular payment date or, if the
Market Exchange Rate is not then available, on the basis of the
most recently available Market Exchange Rate.
(i) All determinations made by the Exchange Rate Agent shall be at
its sole discretion and shall, in the absence of manifest error,
be conclusive for all purposes and binding on the Holder or
Holders of Foreign Currency Notes and any applicable Entitlement
Holders.
SECTION 4.2 Collection Account. Global Funding shall, on or prior to the
Original Issue Date, establish a non-interest bearing account with the Indenture
Trustee or such other depository institution that is rated at least AA by
Standard & Poor's Ratings Services, a division of the McGraw-Hill Companies,
Inc. or Aa2 by Moody's Investors Services, Inc., or has an equivalent rating
from another nationally recognized statistical rating organization as may be
designated by the Trust (the "Collection Account"), into which account shall be
deposited payments received under the applicable Funding Agreement(s) and which
account shall be segregated from other accounts held by the Indenture Trustee or
such other depositary institution.
SECTION 4.3 Offices for Payments, Etc.
(a) So long as any of the Notes remain Outstanding, the Trust will
maintain in New York and in any other city that may be required
by any stock exchange on which the Notes may be listed, and in
any city specified in the Note Certificate(s) the following: (i)
an office or agency where the Notes may be presented for payment,
(ii) an office or agency where the Notes may be presented for
registration of transfer and for exchange as provided in the
Indenture and (iii) an office or agency where notices and demands
to or upon the Trust in respect of the Notes or of the Indenture
may be served. The Trust will give to the Indenture Trustee
written notice of the location of any such office or agency and
of any change of location thereof. The Trust initially designates
the Corporate Trust Office of the Indenture Trustee as the office
or agency for each such purpose. In case the Trust shall
31
fail to maintain any such office or agency or shall fail to give
such notice of the location or of any change in the location
thereof, presentations and demands may be made and notices may be
served at the Corporate Trust Office.
(b) The Trust hereby agrees to issue a standing order to the
Indenture Trustee, pursuant to which the Indenture Trustee,
either directly or through any Paying Agent, shall distribute all
amounts due and unpaid under Section 3.1(b) of the Standard Trust
Terms. For so long as (i) the Trust has not rescinded the
standing order (notice of such rescission to be promptly given by
the Trust to the Indenture Trustee) and (ii) the Indenture
Trustee, either directly or through any Paying Agent is able to,
and does, comply with the standing order, the Trust will not be
required to establish a Payment Account (as defined in the
Standard Trust Terms) in accordance with Section 3.1 of the
Standard Trust Terms.
SECTION 4.4 Appointment to Fill a Vacancy in Office of Indenture Trustee.
The Trust, whenever necessary to avoid or fill a vacancy in the office of
Indenture Trustee, will appoint, in the manner provided in Section 6.8, a
trustee, so that there shall at all times be a trustee under the Indenture.
SECTION 4.5 Paying Agents.
(a) Unless otherwise provided in or pursuant to the Indenture, the
Trust appoints the Indenture Trustee as Paying Agent with respect
to the Notes and the Indenture Trustee accepts such appointment.
The Indenture Trustee, in its capacity as Paying Agent, agrees,
and, whenever the Trust shall appoint a Paying Agent other than
the Indenture Trustee with respect to the Notes, the Trust will
cause such Paying Agent to execute and deliver to the Trust and
the Indenture Trustee an instrument in which such Paying Agent
shall agree with the Trust and the Indenture Trustee, subject to
the provisions of this Section, that it will:
(i) hold all sums received by it as such agent for the payment
of the principal of, any premium or interest on, or any
Additional Amounts with respect to, the Notes (whether such
sums have been paid to it by the Funding Agreement Provider,
the Trust or by any other obligor on the Notes) in trust for
the benefit of each Holder of the Notes;
(ii) give the Indenture Trustee notice of any failure by the
Trust (or by any other obligor on the Notes) to make any
payment of the principal of, any premium and interest on,
32
or any Additional Amounts with respect to, the Notes when
the same shall be due and payable;
(iii) pay any such sums so held in trust by it to the Indenture
Trustee upon the Indenture Trustee's written request at any
time during the continuance of the failure referred to in
clause (ii) above;
(iv) in the absence of the failure referred in clause (ii) above,
pay any such sums so held in trust by it in accordance with
the Indenture and the terms of the Notes; and
(v) comply with all agreements of Paying Agents in, and perform
all functions and obligations imposed on Paying Agents by or
pursuant to, the Indenture and a Note Certificate or
Supplemental Indenture.
(b) At or prior to 9:30 a.m. (New York City time) on each due date of
the principal of, any premium and interest on, or any Additional
Amounts with respect to, the Notes, the Trust will deposit or
cause to be deposited with the applicable Paying Agent a sum
sufficient to pay such principal, any interest or premium, and
any Additional Amounts, and (unless such Paying Agent is the
Indenture Trustee) the Trust will promptly notify the Indenture
Trustee of any failure to take such action.
(c) Anything in this Section to the contrary notwithstanding, the
Trust may at any time, for the purpose of obtaining a
satisfaction and discharge of the Notes under the Indenture, pay
or cause to be paid to the Indenture Trustee all sums held in
trust by the Trust or any Paying Agent under the Indenture, as
required by this Section, such sums to be held by the Indenture
Trustee upon the terms contained in the Indenture.
(d) Anything in this Section to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section are
subject to the provisions of Sections 11.3 and 11.4.
(e) The applicable Paying Agent shall (i) collect all forms from
Holders of Notes (or from such other Persons as are relevant)
that are required to exempt payments under the Notes and/or the
related Funding Agreement(s) from United States Federal income
tax withholding, (ii) withhold and pay over to the Internal
Revenue Service or other taxing authority with respect to
payments under the Notes any amount of taxes required to be
33
withheld by any United States Federal, state or local statute,
rule or regulation and (iii) forward copies of such forms to the
Trust and the Funding Agreement Provider.
(f) Each Paying Agent shall forward to the Trust at least monthly a
bank statement in its possession with respect to the performance
of its functions and obligations with respect to any Notes.
(g) The Trust shall pay the compensation of each Paying Agent at such
rates as shall be agreed upon in writing by the Trust and the
relevant Paying Agent from time to time and shall reimburse each
Paying Agent for reasonable expenses properly incurred by such
Paying Agent in connection with the performance of its duties
upon receipt of such invoices as the Trust shall reasonably
require.
(h) Subject as provided below, each Paying Agent may at any time
resign as Paying Agent by giving not less than 60 days' written
notice to the Trust and the Indenture Trustee (unless the
Indenture Trustee is such Paying Agent) of such intention on its
part, specifying the date on which its resignation shall become
effective. Except as provided below, the Trust may remove a
Paying Agent by giving not less than 20 days' written notice
specifying such removal and the date when it shall become
effective. Any such resignation or removal shall take effect
upon:
(i) the appointment by the Trust of a successor Paying Agent;
and
(ii) the acceptance of such appointment by such successor Paying
Agent,
provided that with respect to any Paying Agent who timely
receives any amount with respect to any Notes and fails duly to
pay any such amounts when due and payable in accordance with the
terms of the Indenture and such Notes, any such removal will take
effect immediately upon such appointment of, and acceptance
thereof by, a successor Paying Agent approved by the Indenture
Trustee (unless the Indenture Trustee is such Paying Agent), in
which event notice of such appointment shall be given to each
Holder of the Notes as soon as practicable thereafter. The Trust
agrees with each Paying Agent that if, by the day falling 10 days
before the expiration of any notice given pursuant to this
Section 4.5(i), the Trust has not appointed a replacement Paying
Agent, then the Paying Agent shall be entitled, on behalf of the
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Trust, to appoint in its place a reputable financial institution
of good standing reasonably acceptable to the Trust and the
Indenture Trustee (unless the Indenture Trustee is such Paying
Agent); provided, however, that notwithstanding the foregoing,
the resignation or removal of the relevant Paying Agent shall not
be effective unless, upon the expiration of the notice given
pursuant to this Section 4.5(i), the successor Paying Agent shall
have accepted its appointment. Upon its resignation or removal
becoming effective, the retiring Paying Agent shall be entitled
to the payment of its compensation and reimbursement of all
expenses incurred by such retiring Paying Agent pursuant to
Section 4.5(h) up to the effective date of such resignation or
removal.
(i) If at any time a Paying Agent shall resign or be removed, or
shall become incapable of acting with respect to the Notes, or
shall be adjudged as bankrupt or insolvent, or a receiver or
liquidator of such Paying Agent or of its property shall be
appointed, or any public officer shall take charge or control of
such Paying Agent or its property or affairs for the purpose of
rehabilitation, conservation or liquidation, then a successor
Paying Agent shall be appointed by the Trust by an instrument in
writing filed with the successor Paying Agent. Upon any such
appointment of, and the acceptance of such appointment by, a
successor Paying Agent and (except in cases of removal for
failure to timely pay any amounts as required by or pursuant to
the Indenture or a Note Certificate or Supplemental Indenture)
the giving of notice to each Holder of the Notes, the retiring
Paying Agent shall cease to be Paying Agent under the Indenture.
(j) Any successor Paying Agent appointed under the Indenture shall
execute and deliver to its predecessor, the Trust and the
Indenture Trustee (unless the Indenture Trustee is such Paying
Agent) a reasonably acceptable instrument accepting such
appointment under the Indenture, and thereupon such successor
Paying Agent, without any further act, deed or conveyance, shall
become vested with all the authority, rights, powers, trusts,
immunities, duties and obligations of such predecessor with like
effect as if originally named as a Paying Agent under the
Indenture, and such predecessor, upon payment of any amounts due
pursuant to Section 4.5(h) and unpaid, shall thereupon become
obliged to transfer and deliver, and such successor Paying Agent
shall be entitled to receive, copies of any relevant records
maintained by such predecessor Paying Agent.
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(k) Any entity into which a Paying Agent may be merged or converted
or with which it may be consolidated or any entity resulting from
any merger, conversion or consolidation to which such Paying
Agent shall be a party, or any entity succeeding to all or
substantially all of the paying agency business of such Paying
Agent shall be a successor Paying Agent under the Indenture
without the execution or filing of any paper or any further act
on the part of any of the parties, anything in the Indenture to
the contrary notwithstanding. At least 30 days' prior notice of
any such merger, conversion or consolidation shall be given to
the Trust and the Indenture Trustee (unless the Indenture Trustee
is such Paying Agent).
SECTION 4.6 Calculation Agent.
(a) Unless otherwise provided in or pursuant to the Indenture, the
Trust appoints the Indenture Trustee as Calculation Agent, and
the Indenture Trustee accepts such appointment.
(b) The relevant Calculation Agent shall perform all functions and
obligations imposed on such Calculation Agent by or pursuant to
the Indenture, and a Note Certificate or Supplemental Indenture.
(c) Each Calculation Agent, excluding the Indenture Trustee, shall
forward to the Trust at least monthly a report providing details
with respect to the performance of its functions and obligations
with respect to the Notes which shall include dates and amounts
of forthcoming payments with respect to the Notes.
(d) The relevant Calculation Agent shall, upon the request of any
relevant Holder of the Notes, provide the interest rate then in
effect and, if determined, the interest rate that will become
effective as a result of a determination made for the next
succeeding Interest Reset Date with respect to the Notes.
(e) All determinations of interest by the Calculation Agent shall, in
the absence of manifest errors, be conclusive for all purposes
and binding on the Holders of the Notes.
(f) The Trust shall pay the compensation of each Calculation Agent at
such rates as shall be agreed upon in writing by the Trust and
the relevant Calculation Agent from time to time and shall
reimburse each Calculation Agent for reasonable expenses properly
incurred by such Calculation Agent in connection with the
performance of its duties upon receipt of such invoices as the
36
Trust shall reasonably require. The Trust also agrees to
indemnify each Calculation Agent for, and to hold it harmless
against, any loss, liability or expense incurred without
negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of its duties
under the Indenture, including the costs and expenses of
defending itself against or investigating any claim of liability
in connection with the exercise or performance of any of its
powers or duties under the Indenture.
(g) Subject as provided below, each Calculation Agent may at any time
resign as Calculation Agent by giving not less than 60 days'
written notice to the Trust and the Indenture Trustee (unless the
Indenture Trustee is such Calculation Agent) of such intention on
its part, specifying the date on which its resignation shall
become effective. Except as provided below, the Trust may remove
a Calculation Agent by giving not less than 20 days' written
notice specifying such removal and the date when it shall become
effective. Any such resignation or removal shall take effect
upon:
(i) the appointment by the Trust of a successor Calculation
Agent; and
(ii) the acceptance of such appointment by such successor
Calculation Agent,
provided that with respect to any Calculation Agent who fails
duly to establish the interest rate or amount for any Interest
Reset Period, any such removal will take effect immediately upon
such appointment of, and acceptance thereof by, a successor
Calculation Agent approved by the Indenture Trustee (unless the
Indenture Trustee is such Calculation Agent), in which event
notice of such appointment shall be given to each Holder of the
Notes as soon as practicable thereafter. The Trust agrees with
each Calculation Agent that if, by the day falling 10 days before
the expiration of any notice given pursuant to this Section
4.6(g), the Trust has not appointed a replacement Calculation
Agent, then the Calculation Agent shall be entitled, on behalf of
the Trust, to appoint in its place a reputable financial
institution of good standing reasonably acceptable to the Trust
and the Indenture Trustee (unless the Indenture Trustee is such
Calculation Agent); provided, however, that notwithstanding the
foregoing, the resignation or removal of the relevant Calculation
Agent shall not be effective unless, upon the expiration of the
notice given pursuant to this Section 4.6(g), the successor
Calculation Agent shall have accepted its appointment. Upon its
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resignation or removal becoming effective, the retiring
Calculation Agent shall be entitled to the payment of its
compensation and reimbursement of all expenses incurred by such
retiring Calculation Agent pursuant to Section 4.6(f) up to the
effective date of such resignation or removal.
(h) If at any time a Calculation Agent shall resign or be removed, or
shall become incapable of acting with respect to the Notes, or
shall be adjudged as bankrupt or insolvent, or a receiver or
liquidator of such Calculation Agent or of its property shall be
appointed, or any public officer shall take charge or control of
such Calculation Agent or its property or affairs for the purpose
of rehabilitation, conservation or liquidation, then a successor
Calculation Agent shall be appointed by the Trust by an
instrument in writing filed with the successor Calculation Agent.
Upon any such appointment of, and the acceptance of such
appointment by, a successor Calculation Agent and (except in
cases of removal for failure to establish the amount of interest)
the giving of notice to each Holder of the Notes, the retiring
Calculation Agent shall cease to be Calculation Agent under the
Indenture.
(i) Any successor Calculation Agent appointed under the Indenture
shall execute and deliver to its predecessor, the Trust and the
Indenture Trustee (unless the Indenture Trustee is such
Calculation Agent) a reasonably acceptable instrument, accepting
such appointment under the Indenture, and thereupon such
successor Calculation Agent, without any further act, deed or
conveyance, shall become vested with all the authority, rights,
powers, trusts, immunities, duties and obligations of such
predecessor with like effect as if originally named as a
Calculation Agent under the Indenture, and such predecessor, upon
payment of any amounts due pursuant to Section 4.6(f) and unpaid,
shall thereupon become obliged to transfer and deliver, and such
successor Calculation Agent shall be entitled to receive, copies
of any relevant records maintained by such predecessor
Calculation Agent.
(j) Any entity into which a Calculation Agent may be merged or
converted or with which it may be consolidated or any entity
resulting from any merger, conversion or consolidation to which
such Calculation Agent shall be a party, or an entity succeeding
to all or substantially all of the paying agency business of such
Calculation Agent shall be a successor Calculation Agent under
the Indenture without the execution or filing of any paper or any
38
further act on the part of any of the parties hereto, anything in
the Indenture to the contrary notwithstanding. At least 30 days'
prior notice of any such merger, conversion or consolidation
shall be given to the Trust and the Indenture Trustee (unless the
Indenture Trustee is such Calculation Agent).
SECTION 4.7 Certificate to Indenture Trustee. The Trust will furnish to the
Indenture Trustee on or before May 15 of each year commencing with the first May
15 following the issuance of any Notes a brief certificate (which need not
comply with Section 13.5) as to its knowledge of the Trust's compliance with all
conditions and covenants under the Indenture (which will be determined without
regard to any period of grace or requirement of notice provided under the
Indenture).
SECTION 4.8 Negative Covenants. So long as any Notes are Outstanding, the
Trust will comply with all of its covenants set forth in Section 6.1(b) of the
Standard Trust Terms.
SECTION 4.9 Non-Petition.
Each of the Indenture Trustee, each other party hereto and each Holder
covenants and agrees that, for a period of one year plus one day after payment
in full of all amounts payable under or in respect of the Indenture and the
Notes, it will not institute against, or join any other Person in instituting
against, the Trust any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings, or other proceedings under any federal or state
bankruptcy or similar law. The immediately preceding sentence shall survive any
termination of the Indenture.
Notwithstanding the foregoing, each of the Indenture Trustee and each other
party hereto covenants and agrees that it will not institute against, or join
any other Person in instituting against, the Trust any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any federal or state bankruptcy or similar law, as a result of
the failure to pay fees or expenses pursuant to Section 6.6 to any party
entitled thereto.
Moreover, each of the Indenture Trustee and each other party hereto
covenants and agrees that it will not cause an Event of Default as a result of
the Trust's failure to pay any fees or expenses to any party entitled thereto
under the Indenture.
SECTION 4.10 Additional Amounts.
If the Note Certificate(s) provide for the payment of Additional Amounts,
the Trust agrees to pay to the Holder of any such Note Additional Amounts as
provided in the Note Certificate(s). Whenever in the Indenture there is
mentioned, in any context, the payment of the principal of, or interest or
premium on, or in respect of, any Note or the net proceeds received on the sale
or exchange of any Note, such reference shall be
39
deemed to include reference to the payment of Additional Amounts provided by the
terms established by the Indenture or pursuant to the Indenture to the extent
that, in such context, Additional Amounts are, were or would be payable in
respect thereof pursuant to such terms, and express reference to the payment of
Additional Amounts in any provision of the Indenture shall not be construed as
excluding Additional Amounts in those provisions hereof where such express
reference is not made.
If the Note Certificate(s) provide for the payment of Additional Amounts,
the Note Certificate will provide that the Trust will pay, or cause to be paid,
Additional Amounts to a Holder of Notes to compensate for any withholding or
deduction for or on account of any present or future taxes, duties, levies,
assessments or governmental charges of whatever nature imposed or levied on
payments on the Notes by or on behalf of any governmental authority in the
United States having the power to tax, so that the net amount received by the
Holder of the Notes, after giving effect to such withholding or deduction,
whether or not currently payable, will equal the amount that would have been
received under the Notes were no such deduction or withholding required;
provided that no such Additional Amounts shall be required for or on account of:
(a) any tax, duty, levy, assessment or other governmental charge
imposed which would not have been imposed but for a Holder or
beneficial owner of one or more of the Notes, (i) having any
present or former connection with the United States, including,
without limitation, being or having been a citizen or resident
thereof, or having been present, having been incorporated in,
having engaged in a trade or business or having (or having had) a
permanent establishment or principal office therein, (ii) being a
controlled foreign corporation within the meaning of Section
957(a) of the Code related (within the meaning of Section
864(d)(4) of the Code) to the Funding Agreement Provider, (iii)
being a bank for United States Federal income tax purposes whose
receipt of interest on the Notes is described in Section
881(c)(3)(A) of the Code, (iv) being an actual or constructive
owner of 10 percent or more of the total combined voting power of
all classes of stock of the Funding Agreement Provider entitled
to vote within the meaning of Section 871(h)(3) of the Code and
Treasury Regulations promulgated thereunder or (v) being subject
to backup withholding as of the date of the purchase by the
Holder of the Notes;
(b) any tax, duty, levy, assessment or other governmental charge
which would not have been imposed but for the presentation of any
Note (where presentation is required) for payment on a date more
than 30 days after the date on which such payment becomes due and
payable or the date on which payment is duly provided for,
whichever occurs later;
40
(c) any tax, duty, levy, assessment or other governmental charge
which is imposed or withheld solely by reason of the failure of
the beneficial owner or a Holder of Notes to comply with
certification, identification or information reporting
requirements concerning the nationality, residence, identity or
connection with the United States of the beneficial owner or a
Holder of Notes, if compliance is required by statute, by
regulation of the United States Treasury Department, judicial or
administrative interpretation, other law or by an applicable
income tax treaty to which the United States is a party as a
condition to exemption from such tax, duty, levy, assessment or
other governmental charge;
(d) any inheritance, gift, estate, personal property, sales, transfer
or similar tax, duty, levy, assessment, or similar governmental
charge;
(e) any tax, duty, levy, assessment or other governmental charge that
is payable otherwise than by withholding from payments in respect
of the Notes;
(f) any tax, duty, levy, assessment or other governmental charge
imposed by reason of payments on the Notes being treated as
contingent interest described in Section 871(h)(4) of the Code
for United States Federal income tax purposes provided that such
treatment was described in the Pricing Supplement;
(g) any tax, duty, levy, assessment or other governmental charge that
would not have been imposed but for an election by the Holder of
the Notes, the effect of which is to make payment in respect of
the Notes subject to United States Federal income tax or
withholding tax provisions; or
(h) any combination of items (a), (b), (c), (d), (e), (f) or (g)
above.
ARTICLE 5
REMEDIES OF THE INDENTURE TRUSTEE AND HOLDERS ON EVENT OF DEFAULT
SECTION 5.1 Event of Default Defined; Acceleration of Maturity; Waiver of
Default.
(a) "Event of Default" with respect to the Notes wherever used in the
Indenture, means each of the following events which shall have
occurred and be continuing (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary
41
or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of
any administrative or governmental body):
(i) default in the payment when due and payable of the principal
of, or any premium on, any Note;
(ii) default in the payment, when due and payable, of any
interest on, or any Additional Amounts with respect to, any
Note and continuance of such default for a period of five
Business Days;
(iii) any "Event of Default", as such term is defined in any
Funding Agreement securing the Notes, by the Funding
Agreement Provider under such Funding Agreement or any
"Event of Default", as such term is defined in any Funding
Note, under such Funding Note;
(iv) the Trust shall fail to observe or perform any covenant
contained in the Notes or in the Indenture for a period of
30 days after the date on which written notice specifying
such failure, stating that such notice is a "Notice of
Default" under the Indenture and demanding that the Trust
remedy the same, will have been given by registered or
certified mail, return receipt requested, to the Trust by
the Indenture Trustee, or to the Trust and the Indenture
Trustee by the Holder or Holders of at least 25% in
aggregate principal amount of the Notes Outstanding; or
(v) the Indenture for any reason shall cease to be in full force
and effect or shall be declared null and void, or the
Indenture Trustee shall fail to have or maintain a validly
created and first priority perfected security interest (or
the equivalent thereof) in the Collateral; or any Person
shall successfully claim, as finally determined by a court
of competent jurisdiction that any Lien for the benefit of
the Holders of the Notes and any other Person for whose
benefit the Indenture Trustee is or will be holding the
Collateral, that the Collateral is void or is junior to any
other Lien or that the enforcement thereof is materially
limited because of any preference, fraudulent transfer,
conveyance or similar law;
(vi) an involuntary case or other proceeding shall be commenced
against the Trust seeking liquidation,
42
reorganization or other relief with respect to it or its
debts under any bankruptcy, insolvency, reorganization or
other similar law or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of
it or any substantial part of its property, and such
involuntary case or other proceeding shall remain
undismissed and unstayed for a period of 60 days; or an
order for relief shall be entered against the Trust under
the Federal bankruptcy laws as now or hereafter in effect;
(vii) the Trust commences a voluntary case or other proceeding
seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy,
insolvency, reorganization or other similar law or seeking
the appointment of a trustee, receiver, liquidator,
custodian or other similar official of it or any substantial
part of its property, or consents to any such relief or to
the appointment of or taking possession by any such official
in an involuntary case or other proceeding commenced against
it, or makes a general assignment for the benefit of
creditors, or fails generally to pay its debts as they
become due, or takes any action to authorize any of the
foregoing; or
(viii) any other Event of Default provided in any Supplemental
Indenture or in a Note Certificate.
(b) If one or more Events of Default shall have occurred and be
continuing with respect to the Notes, then, and in every such
event, unless the principal of all of the Notes shall have
already become due and payable, either the Indenture Trustee or
the Holder or Holders of not less than 25% in aggregate principal
amount of the Notes Outstanding under the Indenture by notice in
writing to the Trust (and to the Indenture Trustee if given by
such Holder or Holders), may declare the entire principal and
premium (if any) of all the Notes, any interest accrued thereon,
and any Additional Amounts due and owing and any other amounts
payable with respect thereto, to be due and payable immediately,
and upon any such declaration the same shall become immediately
due and payable; provided that, if any Event of Default specified
in Section 5.1(a)(vi) or 5.1(a)(vii) occurs with respect to the
Trust, or if any Event of Default specified in Section
5.1(a)(iii) that would cause any Funding Agreement securing the
Notes to become immediately due and payable occurs with respect
to the Funding Agreement Provider, then
43
without any notice to the Trust or any other act by the Indenture
Trustee or any Holder of any Notes, the entire principal and
premium (if any) of all the Notes, any interest accrued thereon,
and any Additional Amounts due and owing, and any other amounts
payable with respect thereto, shall become immediately due and
payable without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Trust.
(c) Notwithstanding Section 5.1(b), if at any time after the
principal and premium of the Notes, any interest accrued thereon,
and any Additional Amounts due and owing and any other amounts
payable with respect thereto shall have been so declared due and
payable and before any judgment or decree for the payment of the
funds due shall have been obtained or entered as provided in the
Indenture, the Trust shall pay or shall deposit with the
Indenture Trustee a sum sufficient to pay all due and payable
interest on, and any Additional Amounts due and owing and any
other amounts payable with respect to, the Notes and the
principal and premium (if any) of any and all Notes which shall
have become due and payable otherwise than by acceleration
pursuant to Section 5.1(b) above (with interest on such principal
and, to the extent that payment of such interest is enforceable
under applicable law, on any overdue interest and any other
amounts payable, at the same rate as the rate of interest
specified in each Note Certificate to the date of such payment or
deposit) and such amount as shall be sufficient to cover
reasonable compensation to the Indenture Trustee and each
predecessor Indenture Trustee, their respective agents, attorneys
and counsel, and all other expenses and liabilities incurred, and
all advances made, by the Indenture Trustee and each predecessor
Indenture Trustee except as a result of negligence or bad faith,
and if any and all Events of Default under the Indenture, other
than the non-payment of the principal of and premium (if any) on
the Notes which shall have become due by acceleration, shall have
been cured, waived or otherwise remedied as provided in the
Indenture, then and in every such case the Holder Representative
(as defined in Section 5.8(a) hereof), by written notice to the
Trust and to the Indenture Trustee, may waive all defaults and
rescind and annul such declaration and its consequences, but no
such waiver or rescission and annulment shall extend to or shall
affect any subsequent default or shall impair any right
consequent thereon.
44
SECTION 5.2 Collection of Indebtedness by Indenture Trustee; Indenture
Trustee May Prove Debt.
(a) Subject to Section 5.1(c), if any Event of Default contained in
Section 5.1(a)(i) or (ii) shall have occurred and be continuing,
the Trust will, upon demand by the Indenture Trustee, pay to the
Indenture Trustee for the benefit of each Holder of the Notes the
whole amount that then shall have become due and payable of the
principal of, any premium and interest on, and any Additional
Amounts due and owing and any other amounts payable with respect
to, the Notes (with interest to the date of such payment upon the
overdue principal and, to the extent that payment of such
interest is enforceable under applicable law, on overdue interest
and any other amounts payable at the same rate as the rate of
interest specified in the Notes); and in addition thereto, such
further amount as shall be sufficient to cover the costs and
expenses of collection, including reasonable compensation to the
Indenture Trustee and each predecessor Indenture Trustee, their
respective agents, attorneys and counsel, and any expenses and
liabilities incurred, and all advances made, by the Indenture
Trustee and each predecessor Indenture Trustee except as a result
of its negligence or bad faith.
(b) Until such demand is made by the Indenture Trustee, the Trust may
pay the principal of, any premium and interest on, and any
Additional Amounts due and owing and any other amounts payable
with respect to, the Notes to the Holders, whether or not the
Notes be overdue.
(c) If the Trust shall fail to pay such amounts upon such demand, the
Indenture Trustee, in its own name and as trustee of an express
trust, shall be entitled and empowered to institute any action or
proceedings at law or in equity for the collection of the sums so
due and unpaid, and may prosecute any such action or proceedings
to judgment or final decree, and may enforce any such judgment or
final decree against the Trust or other obligor upon the Notes
and collect in the manner provided by law out of the property of
the Trust or other obligor upon the Notes, wherever the funds
adjudged or decreed to be payable are situated. If there shall be
pending proceedings relative to the Trust or any other obligor
upon the Notes under Title 11 of the United States Code or any
other applicable Federal or state bankruptcy, insolvency or other
similar law, or if a receiver, assignee or trustee in bankruptcy
or reorganization, liquidator, sequestrator or similar official
shall have been appointed for or
45
taken possession of the Trust or its property or such other
obligor, or in case of any other comparable judicial proceedings
relative to the Trust or other obligor upon the Notes, or to the
creditors or property of the Trust or such other obligor, the
Indenture Trustee, irrespective of whether the principal of the
Notes shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the
Indenture Trustee shall have made any demand pursuant to the
provisions of this Section, shall be entitled and empowered, by
intervention in such proceedings or otherwise:
(i) to file such proofs of a claim or claims and to file such
other papers or documents as may be necessary or advisable
in order to have the claims of the Indenture Trustee
(including any claim for reasonable compensation to the
Indenture Trustee and each predecessor Indenture Trustee,
and their respective agents, attorneys and counsel, and for
reimbursement of all expenses and liabilities incurred, and
all advances made, by the Indenture Trustee and each
predecessor Indenture Trustee, except as those adjudicated
in a court of competent jurisdiction to be the result of any
such Indenture Trustee's negligence or bad faith) and of the
Holders allowed in any judicial proceedings relative to the
Trust or other obligor upon the Notes, or to the creditors
or property of the Trust or such other obligor,
(ii) unless prohibited by applicable law and regulations, to vote
on behalf of the Holders of the Notes in any election of a
trustee or a standby trustee in arrangement, reorganization,
liquidation or other bankruptcy or insolvency proceedings or
Person performing similar functions in comparable
proceedings, and
(iii) to collect and receive any funds or other property payable
or deliverable on any such claims, and to distribute all
amounts received with respect to the claims of each Holder
and of the Indenture Trustee on each Holder's behalf; and
any trustee, receiver, or liquidator, custodian or other
similar official is hereby authorized by each Holder to make
payments to the Indenture Trustee, and, in the event that
the Indenture Trustee shall consent to the making of
payments directly to any Holder, to pay to the Indenture
Trustee such amounts as shall be sufficient to cover
reasonable compensation to the Indenture Trustee,
46
each predecessor Indenture Trustee and their respective
agents, attorneys and counsel, and all other expenses and
liabilities incurred, and all advances made, by the
Indenture Trustee and each predecessor Indenture Trustee
except as those adjudicated in a court of competent
jurisdiction to be the result of any such Indenture
Trustee's negligence or bad faith.
(d) Nothing contained in the Indenture shall be deemed to authorize
the Indenture Trustee to authorize or consent to or vote for or
accept or adopt on behalf of any Holder any plan or
reorganization, arrangement, adjustment or composition affecting
the Notes or the rights of any Holder thereof, or to authorize
the Indenture Trustee to vote in respect of the claim of any
Holder in any such proceeding except, as aforesaid, to vote for
the election of a trustee in bankruptcy or similar Person.
(e) All rights of action and of asserting claims under the Indenture,
or under any of the Notes, may be enforced by the Indenture
Trustee without the possession of any of the Notes or the
production thereof on any trial or other proceedings relative
thereto, and any such action or proceedings instituted by the
Indenture Trustee shall be brought in its own name as trustee of
an express trust, and any recovery of judgment, subject to the
payment of the expenses, disbursements and compensation of the
Indenture Trustee, each predecessor Indenture Trustee and their
respective agents and attorneys, shall be for the ratable benefit
of each Holder.
(f) In any proceedings brought by the Indenture Trustee (and also any
proceedings involving the interpretation of any provision of the
Indenture to which the Indenture Trustee shall be a party) the
Indenture Trustee shall be held to represent every Holder of the
Notes, and it shall not be necessary to make any Holder of the
Notes party to any such proceedings.
SECTION 5.3 Application of Proceeds.
(a) Any funds collected by the Indenture Trustee following an Event
of Default, and during the continuance thereof, pursuant to this
Article or otherwise under the Indenture and any applicable
Supplemental Indenture in respect of the Notes shall be held in
trust in the Collection Account and be applied in the following
order at the date or dates fixed by the Indenture Trustee and, in
case of the distribution of such funds on account of principal,
any
47
premium and interest and any Additional Amounts, upon
presentation of the Note Certificate or Note Certificates
representing the Notes and the notation thereon of the payment if
only partially paid or upon the surrender thereof if fully paid:
First: To the payment of costs and expenses, including reasonable
compensation to the Indenture Trustee and each predecessor Indenture
Trustee and their respective agents and attorneys and of all expenses
and liabilities incurred, and all advances made, by the Indenture
Trustee and each predecessor Indenture Trustee except as those
adjudicated in a court of competent jurisdiction to be the result of
any such Indenture Trustee's negligence or bad faith, in an aggregate
amount of no more than $250,000 for all series of Secured Medium Term
Notes and Allstate Life(R) CoreNotes(R) (including the Notes) issued
under the Program, to the extent not paid pursuant to the Support
Agreement;
Second: To the payment of principal, any premium and interest,
any Additional Amounts and any other amounts then due and owing on the
Notes, ratably, without preference or priority of any kind, according
to the aggregate principal amounts due and payable on the Notes;
Third: To the payment of any other Obligations then due and owing
with respect to the Notes, ratably, without preference or priority of
any kind; and
Fourth: To the payment of any remaining balance to the Trust for
distribution by the Delaware Trustee in accordance with the provisions
of the Trust Agreement.
(b) All funds deposited with the Indenture Trustee pursuant to the
Indenture, except when an Event of Default has occurred and is
continuing, shall be held in trust in the Collection Account and
applied by it, in accordance with the provisions of the Notes and
the Indenture, to the payment through any Paying Agent, to the
Persons entitled thereto, of the principal, premium, if any,
interest and Additional Amounts, if any, for whose payment such
money has been deposited with or received by the Indenture
Trustee. If no Event of Default with respect to the Notes has
occurred and is continuing, the following priority of payments
shall apply:
First: To the payment of principal, any premium and interest, any
Additional Amounts, and any other amounts then due and owing on the
Notes, ratably, without preference or priority of any kind, according
to the aggregate principal amounts due and payable on the Notes;
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Second: To the payment of any other Obligations then due and
owing with respect to the Notes, ratably, without preference or
priority of any kind; and
Third: To the payment of any remaining balance to the Trust for
distribution by the Delaware Trustee in accordance with the provisions
of the Trust Agreement.
SECTION 5.4 Suits for Enforcement. If an Event of Default has occurred, has
not been waived and is continuing, the Indenture Trustee may in its discretion
proceed to protect and enforce the rights vested in it by the Indenture by such
appropriate judicial proceedings as the Indenture Trustee shall deem most
effectual to protect and enforce any of such rights, either at law or in equity
or in bankruptcy or otherwise, whether for the specific enforcement of any
covenant or agreement contained in the Indenture or in aid of the exercise of
any power granted in the Indenture or to enforce any other legal or equitable
right vested in the Indenture Trustee by the Indenture or by law.
SECTION 5.5 Restoration of Rights on Abandonment of Proceedings. If the
Indenture Trustee shall have proceeded to enforce any right under the Indenture
and such proceedings shall have been discontinued or abandoned for any reason,
or shall have been determined adversely to the Indenture Trustee, then and in
every such case the Trust and the Indenture Trustee shall be restored
respectively to their former positions and rights under the Indenture, and all
rights, remedies and powers of the Trust, the Indenture Trustee and each Holder
shall continue as though no such proceedings had been taken.
SECTION 5.6 Limitations on Suits by Holders. No Holder of any Note shall
have any right by virtue or by availing of any provision of the Indenture to
institute any action or proceeding at law or in equity or in bankruptcy or
otherwise upon or under or with respect to the Indenture, or for the appointment
of a trustee, receiver, liquidator, custodian or other similar official or for
any other remedy under the Indenture, unless:
(i) such Holder has previously given written notice to the
Indenture Trustee of a continuing Event of Default;
(ii) the Holder or Holders of Notes representing not less than
25% of the aggregate principal amount of the Outstanding
Notes shall have made written request to the Indenture
Trustee to institute proceedings in respect of such Event of
Default in its own name as the Indenture Trustee;
(iii) such Holder or Holders have offered to the Indenture
Trustee indemnity or security satisfactory to it against the
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costs, expenses and liabilities to be incurred in compliance
with such request;
(iv) the Indenture Trustee for 60 days after its receipt of such
notice, request and offer of indemnity shall have failed to
institute any such action or proceedings; and
(v) no direction inconsistent with such written request shall
have been given to the Indenture Trustee during such 60-day
period by the Holder or Holders of Notes representing at
least 66 2/3% of the aggregate principal amount of the Notes
then Outstanding;
it being understood and intended, and being expressly covenanted by each Holder
of a Note with each other Holder of a Note and the Indenture Trustee, that no
Holder or Holders of Notes shall have any right in any manner whatever by virtue
of, or by availing of, any provision of the Indenture to affect, disturb or
prejudice the rights of any other Holder of any Note, or to obtain or seek to
obtain priority over or preference to any other Holder of any Note or to enforce
any right under the Indenture, except in the manner provided herein and for the
equal, ratable and common benefit of all the Holders of the Notes. For the
protection and enforcement of the provisions of this Section, each Holder and
the Indenture Trustee shall be entitled to such relief as can be given either at
law or in equity.
Notwithstanding any other provisions in the Indenture, however, the right
of any Holder of any Note, which is absolute and unconditional, to receive
payment of the principal of (and premium, if any), and interest on, if any, and
Additional Amounts with respect to, if any, such Note, on or after the
respective due dates expressed in such Note, or to institute suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.
SECTION 5.7 Powers and Remedies Cumulative; Delay or Omission Not Waiver of
Default.
(a) Except as provided in Section 2.7, no right or remedy in the
Indenture conferred upon or reserved to the Indenture Trustee or
to any Holder is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted
by law, be cumulative and in addition to every other right and
remedy given under the Indenture or existing at law or in equity
or otherwise. The assertion or employment of any right or remedy
under the Indenture, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right
or remedy.
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(b) No delay or omission of the Indenture Trustee or of any Holder of
any Note to exercise any right or power accruing upon any Event
of Default occurring and continuing as aforesaid shall impair any
such right or power or shall be construed to be a waiver of any
such Event of Default or an acquiescence therein; and, subject to
Section 5.6, every power and remedy given by the Indenture or by
law to the Indenture Trustee or to any Holder may be exercised
from time to time, and as often as shall be deemed expedient, by
the Indenture Trustee or by such Holder.
SECTION 5.8 Control by the Holders.
(a) The Holders of a majority in aggregate principal amount of the
Notes at the time Outstanding shall have the right to elect a
holder representative (the "Holder Representative") who shall
have binding authority upon all the Holders and shall replace any
Holder Representative then acting in such capacity, and who shall
direct the time, method, and place of conducting any proceeding
for any remedy available to the Indenture Trustee, or exercising
any trust or power conferred on the Indenture Trustee by the
Indenture, provided that:
(i) such direction shall not be otherwise than in accordance
with law and the provisions of the Indenture; and
(ii) subject to the provisions of Section 6.1, the Indenture
Trustee shall have the right to decline to follow any such
direction if the Indenture Trustee, being advised by
counsel, shall determine that the action or proceeding so
directed may not lawfully be taken or if the Indenture
Trustee in good faith by its board of directors, the
executive committee, or a trust committee of directors or
Responsible Officers of the Indenture Trustee shall
determine that the action or proceedings so directed would
involve the Indenture Trustee in personal liability.
(b) Nothing in the Indenture shall impair the right of the Indenture
Trustee in its discretion to take any action deemed proper by the
Indenture Trustee and which is not inconsistent with such
direction by the Holders.
SECTION 5.9 Waiver of Past Defaults. Prior to the declaration of the
maturity of the Notes as provided in Section 5.1, the Holder Representative may
on behalf of the Holders of all the Notes waive any past default or Event of
Default under the Indenture and its consequences, except a default:
51
(i) in the payment of principal of, any premium or interest on,
or any Additional Amounts with respect to, any of the Notes;
or
(ii) in respect of a covenant or provision of the Indenture which
cannot be modified or amended without the consent of the
Holder of each Note.
Upon any such waiver, such default shall cease to exist and be deemed to have
been cured and not to have occurred, and any Event of Default arising therefrom
shall be deemed to have been cured, and not to have occurred for every purpose
of the Indenture; but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon.
ARTICLE 6
THE INDENTURE TRUSTEE
SECTION 6.1 Certain Duties and Responsibilities.
(a) Except if an Event of Default has occurred and is continuing (and
it has not been cured or waived), the Indenture Trustee
undertakes to perform such duties and only such duties with
respect to such Notes as are specifically set forth in the
Indenture. No implied covenants or obligations shall be read into
the Indenture against the Indenture Trustee.
(b) If an Event of Default has occurred and is continuing (and it has
not been cured or waived), the Indenture Trustee shall exercise
such of the rights and powers with respect to the Notes vested in
it by the Indenture, and use the same degree of care and skill in
their exercise, as a prudent person would exercise or use under
the circumstances in the conduct of his or her own affairs.
(c) No provision of the Indenture shall be construed to relieve the
Indenture Trustee from liability for its own negligent action,
its own negligent failure to act or its own willful misconduct,
except that:
(i) this subsection (c) shall not be construed to limit the
effect of subsection (a) of this Section;
(ii) in the absence of bad faith on its part, the Indenture
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the
Indenture Trustee and conforming to the requirements of
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the Indenture unless a Responsible Officer of the Indenture
Trustee has actual knowledge that such statements or
opinions are false; provided that the Indenture Trustee must
examine such certificates and opinions to determine whether
they conform to the requirements of the Indenture;
(iii) the Indenture Trustee shall not be liable for any error of
judgment made in good faith by any Responsible Officer of
the Indenture Trustee, unless it is proved that the
Indenture Trustee was negligent in ascertaining the
pertinent facts;
(iv) the Indenture Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith
in accordance with the direction of the Holder
Representative relating to the time, method and place of
conducting any proceeding for any remedy available to the
Indenture Trustee, or exercising any trust or power
conferred upon the Indenture Trustee, under the Indenture
with respect to the Notes; and
(v) no provision of the Indenture shall require the Indenture
Trustee to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its
duties under the Indenture, or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity
against such liability is not reasonably assured to it.
(d) Whether or not therein expressly so provided, every provision of
the Indenture relating to the conduct or affecting the liability
of or affording protection to the Indenture Trustee shall be
subject to the provisions of this Section.
SECTION 6.2 Certain Rights of the Indenture Trustee. Subject to Section
6.1:
(a) the Indenture Trustee may rely and shall be protected in acting
or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent,
order, bond, debenture, note, coupon, security or other paper or
document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
53
(b) any request, direction, order or demand of the Trust mentioned in
the Indenture shall be sufficiently evidenced by a Trust
Certificate (unless other evidence in respect thereof be
specifically prescribed in the Indenture);
(c) the Indenture Trustee may consult with counsel and any advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken,
suffered or omitted to be taken by it under the Indenture in good
faith and in reliance on such advice or Opinion of Counsel;
(d) the Indenture Trustee shall be under no obligation to exercise
any of the trusts or powers vested in it by the Indenture at the
request, order or direction of any Holder Representative pursuant
to the provisions of the Indenture, unless such Holder
Representative shall have offered to the Indenture Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such
request, order or direction;
(e) whenever in the administration of the Indenture the Indenture
Trustee shall deem it necessary or desirable that a matter be
proved or established prior to taking or suffering or omitting
any action under the Indenture, such matter (unless other
evidence in respect thereof be specifically prescribed in the
Indenture) may, in the absence of negligence or bad faith on its
part, be deemed to be conclusively proved and established by a
Trust Certificate delivered to the Indenture Trustee;
(f) the Indenture Trustee shall not be liable for any action taken or
omitted by it in good faith and believed by it to be authorized
or within the discretion, rights or powers conferred upon it by
the Indenture;
(g) the Indenture Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, appraisal, bond, debenture,
note, coupon, security, or other paper or document unless
requested in writing so to do by the Holder Representative;
provided that, if the payment within a reasonable time to the
Indenture Trustee of the costs, expenses or liabilities likely to
be incurred by it in the making of such investigation is, in the
opinion of the Indenture Trustee, not reasonably assured to the
Indenture Trustee by the security afforded to it by the terms of
the Indenture, the Indenture
54
Trustee may require reasonable indemnity against such expenses or
liabilities as a condition to proceeding; the reasonable expenses
of every such examination shall be paid by the Trust or, if paid
by the Indenture Trustee or any predecessor trustee, shall be
repaid by the Trust upon demand; and
(h) the Indenture Trustee may execute any of the trusts or powers
under the Indenture or perform any duties under the Indenture
either directly or by or through agents or attorneys not
regularly in its employ and the Indenture Trustee shall not be
responsible for any misconduct or negligence on the part of any
such agent or attorney appointed with due care by it under the
Indenture.
SECTION 6.3 Not Responsible for Recitals, Validity of the Notes or
Application of the Proceeds. The recitals contained in the Indenture and in the
Notes, except the Indenture Trustee's certificates of authentication, shall be
taken as the statements of the Trust, and the Indenture Trustee assumes no
responsibility for the correctness of the same. The Indenture Trustee makes no
representation as to the validity or sufficiency of the Indenture or of the
Notes, or of any Funding Agreement, or of the Collateral. The Indenture Trustee
shall not be accountable for the use or application by the Funding Agreement
Provider of the proceeds of the Funding Agreement(s).
SECTION 6.4 May Hold Notes; Collections, Etc. The Indenture Trustee or any
agent of the Trust or the Indenture Trustee, in its individual or any other
capacity, may become the owner or pledgee of Notes with the same rights it would
have if it were not the Indenture Trustee or such agent and, subject to Section
6.7, Section 311(a) of the Trust Indenture Act, and Rule 3a-7 of the Investment
Company Act, may otherwise deal with the Trust, the Administrator, the Funding
Agreement Provider and any other interested party, and receive, collect, hold
and retain collections from the Trust with the same rights it would have if it
were not the Indenture Trustee or such agent.
SECTION 6.5 Funds Held By Indenture Trustee. Subject to the provisions of
Section 11.4, all funds received by the Indenture Trustee shall, until used or
applied as provided in the Indenture, be held in trust for the purposes for
which they were received. The Indenture Trustee (and each of its agents and
Affiliates) shall deposit all cash amounts received by it (or any such agents or
Affiliates) that are derived from the Collateral for the benefit of the Holders
of Notes in the Collection Account. Neither the Indenture Trustee nor any agent
of the Trust or the Indenture Trustee shall be under any liability for interest
on any funds received by it under the Indenture.
SECTION 6.6 Compensation; Reimbursement; Indemnification.
(a) The Trust covenants and agrees:
55
(i) to pay to the Indenture Trustee from time to time, and the
Indenture Trustee shall be entitled to, reasonable
compensation for all services rendered by it under the
Indenture (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee
of an express trust);
(ii) except as otherwise provided in the Indenture, to pay or
reimburse the Indenture Trustee upon its request for all
reasonable expenses, disbursements and advances incurred or
made by the Indenture Trustee in accordance with any
provision of the Indenture (including the reasonable
compensation and the expenses and disbursements of its
agents and counsel), except any such expense, disbursement
or advance as may arise from its negligence or bad faith;
and
(iii) to indemnify the Indenture Trustee for, and to hold it
harmless against, any loss, liability or expense incurred
without negligence or bad faith on its part, arising out of
or in connection with the acceptance or administration of
the Indenture or the trusts under the Indenture and its
duties under the Indenture, including the costs and expenses
of defending itself against or investigating any claim of
liability in connection with the exercise or performance of
any of its powers or duties under the Indenture.
(b) The obligations of the Trust under this Section to compensate and
indemnify the Indenture Trustee and to pay or reimburse the
Indenture Trustee for expenses, disbursements and advances shall
constitute additional indebtedness under the Indenture and shall
survive the satisfaction and discharge of the Indenture and any
resignation or removal of the Indenture Trustee.
SECTION 6.7 Corporate Trustee Required; Eligibility.
(a) There shall at all times be an Indenture Trustee under the
Indenture which shall:
(i) be a banking corporation or national association authorized
under its laws of incorporation or formation and the laws of
the jurisdiction in which it administers the Indenture and
any Supplemental Indenture to exercise corporate trust
powers, having an aggregate capital,
56
surplus of at least $50,000,000; provided that if such
banking corporation or national association publishes
reports of condition at least annually, pursuant to law or
to the requirements of its Federal, State or other
governmental supervisor, then for the purposes of this
Section, the aggregate capital, surplus and undivided
profits of such banking corporation or national association
shall be deemed to be its aggregate capital, surplus and
undivided profits as set forth in its most recent report of
condition so published;
(ii) not be affiliated (as such term is defined in Rule 405 under
the Securities Act) with the Trust or with any Person
involved in the organization or operation of the Trust; and
(iii) not offer or provide credit or credit enhancement to the
Trust.
(b) If at any time the Indenture Trustee shall cease to be eligible
in accordance with the provisions of Section 6.7(a) or the
requirements of Section 310 of the Trust Indenture Act, the
Indenture Trustee shall resign immediately in the manner and with
the effect specified in Section 6.8.
SECTION 6.8 Resignation and Removal; Appointment of Successor Trustee.
(a) The Indenture Trustee may at any time resign by giving not less
than 90 days' prior written notice of resignation to the Trust
and to the Holders of Notes as provided in the Indenture. Upon
receiving such notice of resignation, the Trust shall promptly
cause a successor trustee to be appointed by written instrument
in duplicate, executed by the Trust, one copy of which instrument
shall be delivered to the resigning trustee and one copy to the
successor indenture trustee. If no successor trustee shall have
been so appointed and have accepted appointment within 30 days
after the giving of such notice of resignation, the resigning
trustee may petition any court of competent jurisdiction for the
appointment of a successor indenture trustee. Such court may
thereupon, after such notice, if any, as it may deem proper and
prescribe, appoint a successor trustee.
(b) If at any time:
57
(i) the Indenture Trustee shall cease to be eligible in
accordance with the provisions of Section 6.7(a) or the
requirements of Section 310(a) of the Trust Indenture Act or
any applicable Supplemental Indenture and shall fail to
resign pursuant to Section 6.7(b) or following written
request therefor by the Trust or by any such Holder pursuant
to Section 6.8(c);
(ii) the Indenture Trustee shall become incapable of acting with
respect to the Notes, or shall be adjudged as bankrupt or
insolvent, or a receiver or liquidator of the Indenture
Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Indenture
Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation;
(iii) the Indenture Trustee shall fail to comply with the
obligations imposed upon it under Section 310(b) of the
Trust Indenture Act with respect to the Notes after written
request therefor by the Trust or any Holder of a Note who
has been a bona fide Holder of a Note for at least six
months;
then, in any such case, except during the existence of an Event
of Default, the Trust may remove the Indenture Trustee and
appoint a successor trustee by written instrument, in duplicate,
one copy of which instrument shall be delivered to the Indenture
Trustee so removed and one copy to the successor trustee.
(c) In addition to the right of petition given to the resigning
trustee and the right of removal given to the Trust under
Sections 6.8(a) and 6.8(b), respectively, any Holder who has been
a Holder of Notes for at least six months may, on behalf of
itself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor trustee
or the removal of the Indenture Trustee and the appointment of a
successor trustee, as the case may be. Such court may thereupon,
after such notice, if any, as it may deem proper and prescribe,
appoint a successor trustee or remove the Indenture Trustee and
appoint a successor trustee, as the case may be.
(d) The Holder Representative may at any time remove the Indenture
Trustee and appoint a successor trustee by delivering to the
Indenture Trustee so removed, to the successor trustee so
58
appointed and to the Trust the evidence provided for in Section
8.1 of the action in that regard taken by a Holder.
(e) Any resignation or removal of the Indenture Trustee and any
appointment of a successor trustee pursuant to any of the
provisions of this Section 6.8 shall only become effective upon
acceptance of appointment by the successor trustee as provided in
Section 6.9.
SECTION 6.9 Acceptance of Appointment by Successor Trustee.
(a) Every successor trustee appointed as provided in Section 6.8
shall execute, acknowledge and deliver to the Trust and to its
predecessor indenture trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the
predecessor indenture trustee shall become effective and such
successor indenture trustee, without any further act, deed or
conveyance, shall become vested with all rights, powers, duties
and obligations of its predecessor under the Indenture, with like
effect as if originally named as indenture trustee under the
Indenture; but, nevertheless, on the written request of the Trust
or of the successor indenture trustee, upon payment of its
charges then unpaid, the indenture trustee ceasing to act shall,
subject to Section 11.4, pay over to the successor indenture
trustee all funds at the time held by it under the Indenture and
shall execute and deliver an instrument transferring to such
successor indenture trustee all such rights, powers, duties and
obligations. Upon request of any such successor indenture
trustee, the Trust shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to
such successor indenture trustee all such rights and powers.
Subject to the Lien created under the Indenture, any indenture
trustee ceasing to act shall, nevertheless, retain a claim upon
all property or funds held or collected by such indenture trustee
to secure any amounts then due it pursuant to the provisions of
Section 6.6.
(b) Upon acceptance of appointment by a successor Indenture Trustee
as provided in this Section 6.9, the Trust shall notify each
Holder of any Note and each rating agency then rating any Notes
at the request of the Trust. If the acceptance of appointment is
substantially contemporaneous with the resignation, then the
notice called for by the preceding sentence may be combined with
the notice called for by Section 6.8. If the Trust fails to make
such notice within 10 days after acceptance of appointment by the
successor Indenture Trustee, the successor Indenture
59
Trustee shall cause such notice to be mailed at the expense of
the Trust.
SECTION 6.10 Merger, Conversion, Consolidation or Succession to Business of
Indenture Trustee.
(a) Any corporation or entity into which the Indenture Trustee may be
merged or converted or with which it may be consolidated, or any
corporation or entity resulting from any merger, conversion or
consolidation to which the Indenture Trustee shall be a party, or
any corporation or entity succeeding to all or substantially all
of the corporate trust business of the Indenture Trustee, shall
be the successor of the Indenture Trustee under the Indenture,
provided that such corporation or entity shall be eligible under
the provisions of Section 6.7, without the execution or filing of
any paper or any further act on the part of any of the parties to
the Indenture, anything in the Indenture to the contrary
notwithstanding.
(b) In case at the time such successor to the Indenture Trustee shall
succeed to the trusts created by the Indenture any of the Notes
shall have been authenticated but not delivered, any such
successor to the Indenture Trustee may adopt the certificate of
authentication of any predecessor Indenture Trustee and deliver
such Notes so authenticated; and, in case at that time any of the
Notes shall not have been authenticated, any successor to the
Indenture Trustee may authenticate such Notes either in the name
of any predecessor under the Indenture or in the name of the
successor Indenture Trustee; and in all such cases such
certificate shall have the full force; provided, that the right
to adopt the certificate of authentication of any predecessor
Indenture Trustee or to authenticate Notes in the name of any
predecessor Indenture Trustee shall apply only to its successor
or successors by merger, conversion or consolidation.
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SECTION 6.11 Limitations on Rights of Indenture Trustee as Creditor. The
Indenture Trustee shall comply with Section 311(a) of the Trust Indenture Act.
ARTICLE 7
HOLDERS' LISTS AND REPORTS BY INDENTURE TRUSTEE AND TRUST
SECTION 7.1 Trust To Furnish Indenture Trustee Names And Addresses Of
Holders.
In accordance with Section 312(a) of the Trust Indenture Act, the Trust
shall furnish or cause to be furnished to the Indenture Trustee:
(a) semi-annually not later than June 30 and December 31 of the year
or upon such other dates as are set forth in or pursuant to a
Note Certificate or Supplemental Indenture, a list, in each case
in such form as the Indenture Trustee may reasonably require, of
the names and addresses of Holders as of the applicable date, and
(b) at such other times as the Indenture Trustee may request in
writing, within 30 days after the receipt by the Trust of any
such request, a list of similar form and content as of a date not
more than 15 days prior to the time such list is furnished,
provided, however, that so long as the Indenture Trustee is the Registrar no
such list shall be required to be furnished.
SECTION 7.2 Preservation of Information; Communication to Holders.
The Indenture Trustee shall comply with the obligations imposed upon it
pursuant to Section 312 of the Trust Indenture Act. Every Holder of Notes, by
receiving and holding the same, agrees with the Trust and the Indenture Trustee
that neither the Trust, the Indenture Trustee, any Paying Agent or any Registrar
shall be held accountable by reason of the disclosure of any such information as
to the names and addresses of the Holders of Notes in accordance with Section
312(c) of the Trust Indenture Act, regardless of the source from which such
information was derived, and that the Indenture Trustee shall not be held
accountable by reason of mailing any material pursuant to a request made under
Section 312(b) of the Trust Indenture Act.
SECTION 7.3 Reports by Indenture Trustee.
(a) Within 60 days after May 15 of each year commencing with the
first May 15 following the issuance of Notes, if required by
Section 313(a) of the Trust Indenture Act, the Indenture Trustee
shall transmit, pursuant to Section 313(c) of the Trust Indenture
Act, a brief report dated as of May 15 with respect to any of the
events specified in Section 313(a) of the Trust Indenture Act
61
which may have occurred since the later of the immediately
preceding May 15 and the date of the Indenture.
(b) The Indenture Trustee shall transmit the reports required by
Section 313(a) of the Trust Indenture Act at the time specified
therein.
(c) The Indenture Trustee shall comply with Section 313(b) of the
Trust Indenture Act.
(d) Reports pursuant to this Section shall be transmitted in the
manner and to the Persons required by Sections 313(c) and 313(d)
of the Trust Indenture Act.
(e) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Indenture Trustee with
each stock exchange upon which the Notes are listed, with the
Commission and the Trust. The Trust will notify the Indenture
Trustee whether the Notes are listed on any stock exchange.
(f) Within ten days following any distribution made or scheduled to
be made on the Notes, including any Interest Payment Date or the
Maturity Date, and only to the extent the Trust is required to
file reports under the Exchange Act, the Indenture Trustee will
deliver to the Funding Agreement Provider and the Holders a
report substantially in the form attached as Exhibit C.
SECTION 7.4 Reports and Opinions by Trust.
Pursuant to Section 314(a) of the Trust Indenture Act, the Trust
shall:
(a) file, or cause to be filed, with the Indenture Trustee, within 15
days after the Trust or Global Funding is required to file the
same with the Commission and to the extent available to the
Trust, copies of the annual reports and of the information,
documents and other reports (or copies of such portions of any of
the foregoing as the Commission may from time to time by rules
and regulations prescribe) which the Trust or Global Funding may
be required to file with the Commission pursuant to Section 13 or
Section 15(d) of the Exchange Act; or, if the Trust is not
required to file information, documents or reports pursuant to
either of said Sections, then it shall file, or cause to be
filed, with the Indenture Trustee and the Commission, in
accordance with rules and regulations prescribed from time to
time by the Commission, such of the supplementary and periodic
information, documents
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and reports which may be required pursuant to Section 13 of the
Exchange Act in respect of a security listed and registered on a
national securities exchange as may be prescribed form time to
time in such rules and regulations; provided that if, pursuant to
any publicly available interpretations of the Commission, the
Trust or Global Funding would not be required to make such
filings under Section 314(a) of the Trust Indenture Act, then the
Trust or Global Funding shall not be required to make such
filings;
(b) file, or cause to be filed on its behalf, with the Indenture
Trustee and the Commission, in accordance with rules and
regulations prescribed from time to time by the Commission, such
additional information, documents and reports with respect to
compliance by the Trust, with the conditions and covenants of the
Indenture as may be required from time to time by such rules and
regulations; and
(c) transmit within 30 days after the filing thereof with the
Indenture Trustee, in the manner and to the extent provided in
Section 313(c) of the Trust Indenture Act, such summaries of any
information, documents and reports required to be filed by or on
behalf of the Trust pursuant to paragraphs (1) and (2) of this
Section as may be required by rules and regulations prescribed
from time to time by the Commission.
(d) The Trust shall furnish to the Indenture Trustee:
(i) promptly after the execution and delivery of the Indenture,
an Opinion of Counsel either stating that, in the opinion of
such counsel, the Indenture has been properly recorded,
registered and filed to the extent necessary to make
effective the Security Interest intended to be created by
the Indenture, and reciting the details of such action or
referring to prior Opinions of Counsel in which such details
are given, or stating that, in the opinion of such counsel,
no such action is necessary to make the Security Interest
effective; and
(ii) at least annually, an Opinion of Counsel, dated as of such
date, either stating that, in the opinion of such counsel,
such action has been taken with respect to the recording,
filing, re-recording and re-filing of the Indenture, as is
necessary to maintain the Security Interest of the Indenture
and reciting the details of such action or
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referring to prior Opinions of Counsel in which such details
are given, or stating that, in the opinion of such counsel,
no such action is necessary to maintain the Security
Interest.
SECTION 7.5 Reports on Assessment of Compliance with Servicing Criteria and
Compliance Statements; Attestation Reports of Registered Public Accounting Firm.
In connection with the filing of any Annual Report on Form 10-K of the Trust
filed under the Exchange Act (each, an "Annual Report"), each of the Indenture
Trustee and each Paying Agent (unless the Indenture Trustee is the only Paying
Agent) shall (a) provide to the Funding Agreement Provider, the Trust and Global
Funding (i) a report required pursuant to Item 1122(a) of Regulation AB (17 CFR
229.1100 - 1123)("Regulation AB") on an assessment of compliance with the
servicing criteria set forth in Item 1122(d) of Regulation AB (each a
"Compliance Report") and (ii) a statement of compliance required pursuant to
Item 1123 of Regulation AB, each of which shall be dated the date of, and shall
be filed as an exhibit to, the applicable Annual Report; and (b) cause, at the
expense of the Funding Agreement Provider, a registered public accounting firm
to provide to the Funding Agreement Provider, the Trust and Global Funding an
attestation report on the applicable Compliance Report as required pursuant to
Item 1122(b) of Regulation AB, which shall be dated the date of, and shall be
filed as an exhibit to, the applicable Annual Report.
ARTICLE 8
CONCERNING EACH HOLDER
SECTION 8.1 Evidence of Action Taken by a Holder.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by the Indenture to be given or
taken by any Holder may be embodied in and evidenced (i) by any
instrument or any number of instruments of similar tenor executed
by Holders in person or by agent or proxy appointed in writing,
or (ii) by the record of the Holders of Notes voting in favor
thereof at any meeting of Holders duly called and held in
accordance with the provisions of Article 12, or (iii) by a
combination of such instrument or instruments and any such record
of such meeting of Holders. Except as otherwise expressly
provided in the Indenture, such action shall become effective
when such instrument or instruments are delivered to the
Indenture Trustee. Proof of execution of any instrument or of a
writing appointing any such agent shall be sufficient for any
purpose of the Indenture and (subject to Sections 6.1 and 6.2)
conclusive in favor of the Indenture Trustee and the Trust, if
made in the manner provided in this Article. The record of any
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meeting of Holders of Notes shall be proved in the manner
provided in Section 12.6.
(b) Any request, demand, authorization, direction, notice, consent,
waiver or other action of the Holder of any Note shall bind every
future Holder of the same Note and the Holder of every Note
issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted
or suffered to be done by the Indenture Trustee or the Trust in
reliance thereon, whether or not notation of such action is made
upon the applicable Note Certificate.
SECTION 8.2 Proof of Execution of Instruments and of Holding of Notes.
(a) Subject to Sections 6.1 and 6.2, the execution of any instrument
by a Holder or its agent or proxy may be proved in accordance
with such reasonable rules and regulations as may be prescribed
by the Indenture Trustee or in such manner as shall be
satisfactory to the Indenture Trustee.
(b) The ownership, principal amount and CUSIP numbers of Notes shall
be proved by the Note Register or by a certificate of the
Indenture Trustee.
SECTION 8.3 Voting Record Date. The Trust may set a record date for
purposes of determining the identity of each Holder of a Note entitled to vote
or consent to any action referred to in Section 8.1, which record date may be
set at any time or from time to time by notice to the Indenture Trustee, for any
date or dates (in the case of any adjournment or resolicitation) not more than
60 days nor less than 5 days prior to the proposed date of such vote or consent,
and thereafter, notwithstanding any other provisions of the Indenture, only a
Holder of any Note on such record date shall be entitled to so vote or give such
consent or to withdraw such vote or consent.
SECTION 8.4 Persons Deemed to be Owners. The Trust, the Indenture Trustee
and any agent of the Trust or the Indenture Trustee may deem and treat the
Holder of any Note of as the absolute owner of such Note (whether or not such
Note shall be overdue and notwithstanding any notation of ownership or other
writing on the applicable Note Certificate) for the purpose of receiving payment
of or on account of the principal of, any premium on, and, subject to the
provisions of the Indenture, any interest on, and any Additional Amounts with
respect to, such Note and for all other purposes; and neither the Trust nor the
Indenture Trustee nor any agent of the Trust or the Indenture Trustee shall be
affected by any notice to the contrary. All such payments so made to any such
Person, or upon such Person's order, shall be valid, and, to the extent of the
sum or sums so paid, effectual to satisfy and discharge the liability for funds
payable upon any such Note.
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SECTION 8.5 Notes Owned by Trust Deemed Not Outstanding. In determining
whether the Holders of the requisite aggregate principal amount of Notes have
concurred in any direction, consent or waiver under the Indenture, Notes which
are owned by the Trust or any other obligor on the Notes or by any Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with the Trust or any other obligor on the Notes shall be
disregarded and deemed not to be Outstanding for the purpose of any such
determination, except that for the purpose of determining whether the Indenture
Trustee shall be protected in relying on any such direction, consent or waiver
only Notes which the Indenture Trustee knows are so owned shall be so
disregarded. Notes so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Indenture Trustee the pledgee's right so to act with respect to such Notes and
that the pledgee is not the Trust or any other obligor upon the Notes or any
Person directly or indirectly controlling or controlled by or under direct or
indirect common control with the Trust or any other obligor on the Notes. In
case of a dispute as to such right, the advice of counsel shall be full
protection in respect of any decision made by the Indenture Trustee in
accordance with such advice. Upon request of the Indenture Trustee, the Trust
shall furnish to the Indenture Trustee promptly a Trust Certificate listing and
identifying all Notes, if any, known by the Trust to be owned or held by or for
the account of any of the above-described Persons; and, subject to Sections 6.1
and 6.2, the Indenture Trustee shall be entitled to accept such Trust
Certificate as conclusive evidence of the facts therein set forth and of the
fact that all Notes not listed therein are Outstanding for the purpose of any
such determination.
SECTION 8.6 Right of Revocation of Action Taken; Binding Effect of Actions
by Holders.
(a) At any time prior to (but not after) the evidencing to the
Indenture Trustee, as provided in Section 8.1, of the taking of
any action by the Holders of the percentage in aggregate
principal amount of the Notes specified in the Indenture in
connection with such action, any Holder of a Note represented by
a Note Certificate the serial number of which is shown by the
evidence to be included among the serial numbers of the Note
Certificates representing Notes the Holders of which have
consented to such action may, by filing written notice at the
Corporate Trust Office and upon proof of holding as provided in
this Article, revoke such action so far as concerns such Note.
(b) Any action taken by the Holders of the percentage in aggregate
principal amount of the Notes specified in the Indenture in
connection with such action shall be conclusively binding upon
the Trust, the Indenture Trustee and all present and future
Holders of the Notes, irrespective of whether or not any notation
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in regard of any such action is made on any applicable Note
Certificate.
ARTICLE 9
SUPPLEMENTAL INDENTURES
SECTION 9.1 Supplemental Indentures Without Consent of Holders.
(a) The Trust and the Indenture Trustee may from time to time and at
any time enter into an indenture or indentures supplemental to
the Indenture (each, a "Supplemental Indenture") (which shall
conform to the provisions of the Trust Indenture Act) for one or
more of the following purposes without the consent of any Holder:
(i) for the Trust to convey, transfer, assign, mortgage or
pledge to the Indenture Trustee as security for the Notes
any property or assets;
(ii) to add to the covenants of the Trust such further covenants,
restrictions, conditions or provisions as the Trust and the
Indenture Trustee shall consider to be for the protection of
each Holder of any Note, and to make the occurrence, or the
occurrence and continuance, of a default in any such
additional covenants, restrictions, conditions or provisions
an Event of Default permitting the enforcement of all or any
of the several remedies provided in the Indenture as set
forth in the Indenture; provided, that in respect of any
such additional covenant, restriction, condition or
provision such Supplemental Indenture may provide for a
particular period of grace after default (which period may
be shorter or longer than that allowed in the case of other
defaults) or may provide for an immediate enforcement upon
such an Event of Default or may limit the remedies available
to the Indenture Trustee upon such an Event of Default or
may limit the right of the Holder Representative to waive
such an Event of Default;
(iii) to cure any ambiguity or to correct or supplement any
provision contained in the Indenture or in any Supplemental
Indenture or Note Certificate which may be defective or
inconsistent with any other provision contained in the
Indenture or in any Supplemental Indenture or Note
Certificate; or to make such other
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provisions in regard to matters or questions arising under
the Indenture or under any Supplemental Indenture or Note
Certificate which shall not adversely affect the interests
of the Holders of the Notes in any material respect; or
(iv) to evidence and provide for the acceptance of appointment
under the Indenture by a successor trustee and to add to or
change any of the provisions of the Indenture as shall be
necessary to provide for or facilitate the administration of
the trusts under the Indenture by more than one trustee.
(b) The Indenture Trustee is authorized to join with the Trust in the
execution of any such Supplemental Indenture, and to make any
further appropriate agreements and stipulations which may be
therein contained, but the Indenture Trustee shall not be
obligated to enter into any such Supplemental Indenture which
affects the Indenture Trustee's own rights, duties or immunities
under the Indenture or otherwise.
(c) Any Supplemental Indenture authorized by the provisions of this
Section may be executed without the consent of any Holder of any
Note at the time Outstanding, notwithstanding any of the
provisions of Section 9.2.
SECTION 9.2 Supplemental Indentures With Consent of Holders.
(a) With the consent (evidenced as provided in Article 8) of the
Holders of not less than 66 2/3% in aggregate principal amount of
the Notes at the time Outstanding, the Trust and the Indenture
Trustee may, from time to time and at any time, enter into a
Supplemental Indenture for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions
of the Indenture or of any Supplemental Indenture or Note
Certificate or of modifying in any manner the rights of the
Holders of the Notes; provided, that no such Supplemental
Indenture shall, without the consent of the Holder of each Note
so affected:
(i) change the final maturity of any Note, or reduce the
principal amount thereof, or reduce the rate or extend the
time of payment of interest or any other amount payable
thereon, or impair or affect the right of any Holder to
institute suit for the payment thereof or modify any
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redemption or repayment provisions applicable to the Notes;
(ii) permit the creation of any Lien on the Collateral or any
part thereof (other than the Security Interest) or terminate
the Security Interest as to any part of the Collateral,
except as permitted by the Indenture; or
(iii) modify any of the provisions of this Section 9.2 except to
increase the aforementioned percentage of Notes required to
approve any Supplemental Indenture.
(b) Upon the request of the Trust, and upon the filing with the
Indenture Trustee of evidence of the consent of each Holder and
other documents, if any, required by Section 8.1 the Indenture
Trustee shall join with the Trust in the execution of such
Supplemental Indenture unless such Supplemental Indenture affects
the Indenture Trustee's own rights, duties or immunities under
the Indenture or otherwise, in which case the Indenture Trustee
may in its discretion, but shall not be obligated to, enter into
such Supplemental Indenture.
(c) It shall not be necessary for the consent of the Holders under
this Section to approve the particular form of any proposed
Supplemental Indenture, but it shall be sufficient if such
consent shall approve the substance thereof.
(d) Promptly after the execution by the Trust and the Indenture
Trustee of any Supplemental Indenture pursuant to the provisions
of this Section, the Indenture Trustee shall notify the Holders
of each Note, as provided in the Indenture, setting forth in
general terms the substance of such Supplemental Indenture. Any
failure of the Indenture Trustee to provide such notice, or any
defect therein, shall not, however, in any way impair or affect
the validity of any such Supplemental Indenture.
SECTION 9.3 Compliance with Trust Indenture Act; Effect of Supplemental
Indentures. Any Supplemental Indenture executed pursuant to the provisions of
this Article shall comply with the Trust Indenture Act. Upon the execution of
any Supplemental Indenture pursuant to the provisions of the Indenture, the
Indenture shall be and be deemed to be modified and amended in accordance
therewith and the respective rights, limitations of rights, obligations, duties
and immunities under the Indenture of the Indenture Trustee, the Trust, each
agent of the Trust and each Holder of Notes shall thereafter be determined,
exercised and enforced under the Indenture subject in all respects to such
modifications and amendments, and all
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the terms and conditions of any such Supplemental Indenture shall be and be
deemed to be part of the terms and conditions of the Indenture for any and all
purposes.
SECTION 9.4 Documents to Be Given to Indenture Trustee. The Indenture
Trustee, subject to the provisions of Sections 6.1 and 6.2, may receive a Trust
Certificate and an Opinion of Counsel as conclusive evidence that any such
Supplemental Indenture complies with the applicable provisions of the Indenture.
SECTION 9.5 Notation on Note Certificates in Respect of Supplemental
Indentures. Any Note Certificate authenticated and delivered after the execution
of any Supplemental Indenture pursuant to the provisions of this Article may
bear a notation in form approved by the Indenture Trustee as to any matter
provided for by such Supplemental Indenture or as to any action taken at any
such meeting. If the Trust or the Indenture Trustee shall so determine, a new
Note Certificate representing Notes so modified as to conform, in the opinion of
the Indenture Trustee and the Trust, to any modification of the Indenture
contained in any such Supplemental Indenture may be prepared by the Trust,
authenticated by the Indenture Trustee and delivered in exchange for each Note
Certificate representing Notes then Outstanding.
SECTION 9.6 Amendment to Funding Agreements.
(a) The Trust and the Indenture Trustee may from time to time and at
any time enter into or consent to one or more amendments to any
Funding Agreement for one or more of the following purposes
without the consent of any Holder: to cure any ambiguity or to
correct or supplement any provision contained in such Funding
Agreement which may be defective or inconsistent with any other
provision contained in such Funding Agreement, or with any
provision of the Indenture, the Notes, the Funding Note, the
Distribution Agreement, the Trust Agreement, the Administrative
Services Agreement, the Coordination Agreement, the Name
Licensing Agreement, the Support Agreement, the Terms Agreement
or the Pricing Supplement, or to make such other provisions in
regard to matters or questions arising under such Funding
Agreement or the Indenture which shall not adversely affect the
interests of the Holders of the Notes in any material respect.
(b) With the consent (evidenced as provided in Article 8) of the
Holders of not less than 66 2/3% in aggregate principal amount of
the Notes at the time Outstanding, the Trust and the Indenture
Trustee may, from time to time and at any time, enter into or
consent to one or more amendments to any Funding Agreement for
the purpose of adding any provisions to or changing in any manner
or eliminating any of the provisions of such Funding
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Agreement; provided, that no such amendment shall change the
Maturity Date (as defined in such Funding Agreement) of such
Funding Agreement, or reduce the principal amount thereof, or
reduce the rate or extend the time of payment of interest or any
other amount payable thereon, or impair or affect the right of
the Indenture Trustee or the Trust to institute suit for the
payment thereof or modify any redemption or repayment provisions
applicable to such Funding Agreement without the consent of the
Holder of each Note affected thereby.
(c) The Indenture Trustee may receive and conclusively rely upon an
Opinion of Counsel stating whether or not any Notes would be
affected by any amendment of a Funding Agreement and any such
Opinion of Counsel shall be conclusive upon all the Holders of
the Notes.
(d) Notwithstanding any other provision, the Trust and the Indenture
Trustee will not enter into or consent to any amendment to any
Funding Agreement with the Funding Agreement Provider or permit
any Funding Agreement to be amended or modified if such amendment
or modification would cause the Trust not to be ignored or
treated as a "grantor trust" for United States federal income tax
purposes (as evidenced by an Opinion of Counsel). Furthermore,
the Trust and the Indenture Trustee will not enter into or
consent to any agreement or take any action which would cause the
Trust to become required to be registered as an "investment
company", or come under the "control" of an "investment company,"
as such terms are defined in the Investment Company Act.
(e) The Indenture Trustee, subject to the provisions of Sections 6.1
and 6.2, may receive an Opinion of Counsel as conclusive evidence
that any such amendment to a Funding Agreement complies with the
requirements of Section 9.6(a) or (b), as applicable, and any
such Opinion of Counsel shall be conclusive on the Holders of the
Notes.
(f) It shall not be necessary for the consent of the Holders under
this Section to approve the particular form of any proposed
amendment to a Funding Agreement, but it shall be sufficient if
such consent shall approve the substance thereof.
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ARTICLE 10
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 10.1 Trust May Merge, Consolidate, Sell Or Convey Property Under
Certain Circumstances. The Trust may not consolidate with, or merge into, any
entity (whether or not affiliated with the Trust), or sell, lease or convey the
property of the Trust as an entirety or substantially as an entirety, unless:
(a) the entity formed by such consolidation or into which the Trust
is merged or the entity which acquires by conveyance or transfer
the properties and assets of the Trust substantially as an
entirety shall be a statutory trust formed under the laws of the
State of Delaware or a corporation or other entity organized and
existing under the laws of the United States of America or any
State or the District of Columbia, and shall expressly assume, by
a Supplemental Indenture, executed and delivered to the Indenture
Trustee, in form satisfactory to the Indenture Trustee, the due
and punctual payment of the principal of, any premium and
interest on, and any Additional Amounts with respect to, the
Notes and the performance of every covenant of the Indenture on
the part of the Trust to be performed or observed;
(b) immediately after giving effect to such transaction, no Event of
Default, and no event which, after notice or lapse of time, or
both, would become an Event of Default, shall have happened and
be continuing;
(c) the Trust has received written confirmation from any rating
agency then rating any Notes at the request of the Trust that
such consolidation, merger, conveyance or transfer shall not
cause the rating on the then Outstanding Notes to be downgraded
or withdrawn; and
(d) the Trust has delivered to the Indenture Trustee a Trust
Certificate and an Opinion of Counsel each stating that such
consolidation, merger, conveyance or transfer and such
Supplemental Indenture comply with this Article and that all
conditions precedent provided for in the Indenture relating to
such transaction have been complied with.
ARTICLE 11
SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED FUNDS
SECTION 11.1 Satisfaction and Discharge of Indenture. If at any time (a)
the Trust shall have paid or caused to be paid all outstanding principal of, any
premium
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and interest on, and any Additional Amounts and other amounts payable with
respect to, all the Notes Outstanding under the Indenture, as and when the same
shall have become due and payable, or (b) the Trust shall have delivered to the
Indenture Trustee for cancellation all Note Certificates representing Notes
theretofore authenticated (other than any Note Certificate which shall have been
destroyed, lost or stolen and which shall have been replaced or paid as provided
in Section 2.7) or (c) the Trust shall have irrevocably deposited or caused to
be deposited with the Indenture Trustee as trust funds the entire amount in cash
(other than funds repaid by the Indenture Trustee or any Paying Agent to the
Trust in accordance with Section 11.4) sufficient to pay at maturity all amounts
payable at maturity on the Notes represented by each Note Certificate not
theretofore delivered to the Indenture Trustee for cancellation, including any
outstanding principal, interest, premium, Additional Amounts and other amounts
due or to become due to such date of maturity as the case may be, and if, in any
such case, the Trust shall also pay or cause to be paid all other sums payable
under the Indenture by the Trust, then the Indenture shall cease to be of
further effect (except as to (i) rights of registration of transfer and
exchange, (ii) substitution of apparently mutilated, defaced, destroyed, lost or
stolen Note Certificates, (iii) rights of Holders to receive payments of
principal of, any premium and interest on, and any Additional Amounts and other
amounts payable with respect to, the Notes, (iv) the rights, obligations and
immunities of the Indenture Trustee under the Indenture and (v) the rights of
each Holder as beneficiary of the Indenture with respect to the property so
deposited with the Indenture Trustee payable to all or any of them), and the
Indenture Trustee, on demand of the Trust accompanied by a Trust Certificate and
an Opinion of Counsel and at the cost and expense of the Trust, shall execute
proper instruments acknowledging such satisfaction of and discharging the
Indenture. The Trust agrees to reimburse the Indenture Trustee for any costs or
expenses thereafter reasonably and properly incurred and to compensate the
Indenture Trustee for any services thereafter reasonably and properly rendered
by the Indenture Trustee in connection with the Indenture or the Notes.
SECTION 11.2 Application by Indenture Trustee of Funds Deposited for
Payment of Notes. Subject to Section 11.4, all funds deposited with the
Indenture Trustee pursuant to Section 11.1 shall be held in trust in the
Collection Account in accordance with Section 6.5 and applied by it to the
payment, either directly, in its capacity as the Paying Agent, or through any
other Paying Agent, to each Holder of any Note for the payment or redemption of
which such funds have been deposited with the Indenture Trustee, of all sums due
and to become due thereon for any principal, interest, premium, Additional
Amounts or other amounts.
SECTION 11.3 Repayment of Funds Held by Paying Agent. In connection with
the satisfaction and discharge of the Indenture, all funds then held by any
Paying Agent under the provisions of the Indenture shall, upon demand of the
Trust, be repaid to the Trust or paid to the Indenture Trustee and thereupon
such Paying Agent shall be released from all further liability with respect to
such funds.
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SECTION 11.4 Return of Funds Held by Indenture Trustee and Paying Agent.
Any funds deposited with or paid to the Indenture Trustee or any Paying Agent
for the payment of the principal of, any interest or premium on, or any
Additional Amounts or any other amounts with respect to, any Note and not
applied but remaining unclaimed for three years after the date upon which such
principal, interest, premium, Additional Amounts or any other amount shall have
become due and payable, shall, upon the written request of the Trust and unless
otherwise required by mandatory provisions of applicable escheat or abandoned or
unclaimed property law, be repaid to the Trust by the Indenture Trustee or such
Paying Agent, and the Holder of such Note shall, unless otherwise required by
mandatory provisions of applicable escheat or abandoned or unclaimed property
laws, thereafter look only to the Trust for any payment which such Holder may be
entitled to collect, and all liability of the Indenture Trustee or any Paying
Agent with respect to such funds shall thereupon cease.
ARTICLE 12
MEETINGS OF HOLDERS OF NOTES
SECTION 12.1 Purposes for Which Meetings May Be Called. A meeting of
Holders of Notes may be called at any time and from time to time pursuant to
this Article to make, give or take any request, demand, authorization,
direction, notice, consent, waiver or other action provided by the Indenture to
be made, given or taken by Holders of Notes.
SECTION 12.2 Call, Notice and Place of Meetings.
(a) Unless otherwise provided in a Note Certificate, the Indenture
Trustee may at any time call a meeting of Holders of Notes for
any purpose specified in Section 12.1, to be held at such time
and at such place in the City of New York or the city in which
the Corporate Trust Office is located. Notice of every meeting of
Holders of Notes, setting forth the time and the place of such
meeting and in general terms the action proposed to be taken at
such meeting, shall be given in the manner provided in Section
13.4, not less than 21 nor more than 180 days prior to the date
fixed for the meeting.
(b) In case at any time the Trust or the Holder or Holders of at
least 10% in principal amount of the Notes shall have requested
the Indenture Trustee to call a meeting of the Holders of Notes
for any purpose specified in Section 12.1, by written request
setting forth in reasonable detail the action proposed to be
taken at the meeting, and the Indenture Trustee shall not have
made the first publication or mailing of the notice of such
meeting within 21 days after receipt of such request or shall not
thereafter proceed to cause the meeting to be held as provided in
the Indenture, then
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the Trust or the Holder or Holders of Notes in the amount above
specified, as the case may be, may determine the time and the
place in the City of New York or the city in which the Corporate
Trust Office is located for such meeting and may call such
meeting for such purposes by giving notice thereof as provided in
Section 12.2.
SECTION 12.3 Persons Entitled to Vote at Meetings. To be entitled to vote
at any meeting of Holders of Notes, a Person shall be (a) a Holder of one or
more Notes then Outstanding, or (b) a Person appointed by an instrument in
writing as proxy for a Holder or Holders of one or more Notes then Outstanding
by such Holder or Holders. The only Persons who shall be entitled to be present
or to speak at any meeting of Holders of Notes shall be the Persons entitled to
vote at such meeting and their counsel, any representatives of the Indenture
Trustee and its counsel and any representatives of the Trust and its counsel.
SECTION 12.4 Quorum; Action.
(a) The Persons entitled to vote a majority in principal amount of
the Notes then Outstanding shall constitute a quorum for a
meeting of Holders of Notes; provided, however, that if any
action is to be taken at such meeting with respect to a consent
or waiver which the Indenture expressly provides may be given by
the Holders of not less than 66 2/3% in principal amount of the
Outstanding Notes, then Persons entitled to vote 66-% in
principal amount of the Outstanding Notes shall constitute a
quorum. In the absence of a quorum within 30 minutes after the
time appointed for any such meeting, the meeting shall, if
convened at the request of Holders of Notes, be dissolved. In any
other case the meeting may be adjourned for a period of not less
than 10 days as determined by the chairman of the meeting prior
to the adjournment of such meeting. In the absence of a quorum at
any such adjourned meeting, such adjourned meeting may be further
adjourned for a period of not less than 10 days as determined by
the chairman of the meeting prior to the adjournment of such
adjourned meeting. Notice of the reconvening of any adjourned
meeting shall be given as provided in Section 12.2, except that
such notice need be given only once not less than five days prior
to the date on which the meeting is scheduled to be reconvened.
Notice of the reconvening of an adjourned meeting shall state
expressly the percentage, as provided above, of the principal
amount of the Outstanding Notes which shall constitute a quorum.
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(b) Except as limited by the proviso to Section 9.2(a), any
resolution presented to a meeting or adjourned meeting duly
reconvened at which a quorum is present as aforesaid may be
adopted only by the affirmative vote of the Holders of a majority
in principal amount of the Outstanding Notes; provided, however,
that, except as limited by the proviso to Section 9.2(a), any
resolution with respect to any consent or waiver which the
Indenture expressly provides may be given by the Holders of not
less than 66-% in principal amount of the Outstanding Notes may
be adopted at a meeting or an adjourned meeting duly convened and
at which a quorum is present as aforesaid only by the affirmative
vote of the Holders of 66 2/3% in principal amount of the
Outstanding Notes; and provided, further, that, except as limited
by the proviso to Section 9.2(a), any resolution with respect to
any request, demand, authorization, direction, notice, consent,
waiver or other action which the Indenture expressly provides may
be made, given or taken by the Holders of a specified percentage,
which is less than a majority, in principal amount of the
Outstanding Notes may be adopted at a meeting or an adjourned
meeting duly reconvened and at which a quorum is present as
aforesaid by the affirmative vote of the Holders of such
specified percentage in principal amount of the Outstanding
Notes.
(c) Any resolution passed or decision taken at any meeting of Holders
of Notes duly held in accordance with this Section shall be
binding on all the Holders of Notes, whether or not such Holders
were present or represented at the meeting.
SECTION 12.5 Determination of Voting Rights; Conduct of Adjournment of
Meetings.
(a) Notwithstanding any other provisions of the Indenture, the
Indenture Trustee may make such reasonable regulations as it may
deem advisable for any meeting of Holders of Notes in regard to
proof of the holding of Notes and of the appointment of proxies
and in regard to the appointment and duties of inspectors of
votes, the submission and examination of proxies, certificates
and other evidence of the right to vote, and such other matters
concerning the conduct of the meeting as it shall deem
appropriate. Except as otherwise permitted or required by any
such regulations, the holding of Notes shall be proved in the
manner specified in Section 8.4 and the appointment of any proxy
shall be proved in the manner specified in Section 8.2. Such
regulations may provide that written instruments appointing
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proxies, regular on their face, may be presumed valid and genuine
without the proof specified in Section 8.2 or other proof.
(b) The Indenture Trustee shall, by an instrument in writing, appoint
a temporary chairman of the meeting, unless the meeting shall
have been called by the Trust or by Holders of Notes as provided
in Section 12.2(b), in which case the Trust or the Holders of
Notes calling the meeting, as the case may be, shall in like
manner appoint a temporary chairman. A permanent chairman and a
permanent secretary of the meeting shall be elected by vote of
the Persons entitled to vote a majority in principal amount of
the Outstanding Notes represented at the meeting.
(c) At any meeting, each Holder of a Note or proxy shall be entitled
to one vote for each $1,000 of principal amount of Notes held or
represented by such Holder or proxy; provided, however, that no
vote shall be cast or counted at any meeting in respect of any
Note challenged as not Outstanding and ruled by the chairman of
the meeting to be not Outstanding. The chairman of the meeting
shall have no right to vote, except as a Holder of a Note or
proxy.
(d) Any meeting of Holders of Notes duly called pursuant to Section
12.2 at which a quorum is present may be adjourned from time to
time by Persons entitled to vote a majority in principal amount
of the Outstanding Notes represented at the meeting; and the
meeting may be held as so adjourned without further notice.
SECTION 12.6 Counting Votes and Recording Action of Meetings. The vote upon
any resolution submitted to any meeting of Holders of Notes shall be (a) by
written ballots on which shall be subscribed the signatures of the Holders of
Notes or of their representatives by proxy and the principal amounts and serial
numbers of the Outstanding Notes held or represented by them or (b) by such
other procedures adopted by the Indenture Trustee in its discretion. The
permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their verified written
reports in triplicate of all votes cast at the meeting. A record, at least in
triplicate, of the proceedings of each meeting of Holders of Notes shall be
prepared by the secretary of the meeting and there shall be attached to said
record the original reports of the inspectors of votes on any vote by ballot
taken thereat and affidavits by one or more persons having knowledge of the
facts setting forth a copy of the notice of the meeting and showing that said
notice was given as provided in Section 12.2 and, if applicable, Section 12.4.
Each copy shall be signed and verified by the affidavits of the permanent
chairman and secretary of the meeting and one such copy shall be delivered to
the Trust, and another to the Indenture Trustee to be preserved by the Indenture
Trustee, the latter to have attached thereto the ballots voted at the meeting.
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Any record so signed and verified shall be conclusive evidence of the matters
therein stated.
ARTICLE 13
MISCELLANEOUS PROVISIONS
SECTION 13.1 No Recourse. Notwithstanding anything to the contrary
contained in the Indenture, or any relevant Note Certificate or Supplemental
Indenture, none of the Funding Agreement Provider, its officers, directors,
affiliates, employees or agents, or any of the Delaware Trustee, the Indenture
Trustee or the Trust Beneficial Owner, or any of their officers, directors,
affiliates, employees or agents (the "Nonrecourse Parties") will be personally
liable for the payment of any principal, interest or any other sums at any time
owing under the terms of the Notes. If any Event of Default shall occur with
respect to the Notes, the right of the Holders of the Notes and the Indenture
Trustee on behalf of such Holders in connection with a claim on the Notes shall
be limited solely to a proceeding against the Collateral. Neither the Holders
nor the Indenture Trustee on behalf of the Holders will have the right to
proceed against the Nonrecourse Parties to enforce the Notes (except that to the
extent they exercise their rights, if any, to seize the relevant Funding
Agreement(s), they may enforce the relevant Funding Agreement(s) against the
Funding Agreement Provider) or for any deficiency judgment remaining after
foreclosure of any property included in the relevant Collateral.
It is expressly understood and agreed that nothing contained in this
Section shall in any manner or way constitute or be deemed a release of the debt
or other obligations evidenced by the Notes or otherwise affect or impair the
enforceability against the Trust of the liens, assignments, rights and the
Security Interest created by or pursuant to the Indenture, the relevant
Collateral or any other instrument or agreement evidencing, securing or relating
to the indebtedness or the obligations evidenced by the Notes. Nothing in this
Section shall preclude the Holders from foreclosing upon any property included
in the Collateral or any other rights or remedies in law or in equity against
the Trust.
SECTION 13.2 Provisions of Indenture for the Sole Benefit of Parties and
Holders. Nothing in the Indenture or in the Notes, expressed or implied, shall
give or be construed to give to any Person, other than the parties to the
Indenture and their successors and the Holders of the Notes, any legal or
equitable right, remedy or claim under the Indenture or under any covenant or
provision contained in the Indenture, all such covenants and provisions being
for the sole benefit of the parties to the Indenture and their successors and of
the Holders of the Notes.
SECTION 13.3 Successors and Assigns of Trust Bound by Indenture. All the
covenants, stipulations, promises and agreements in the Indenture contained by
or in behalf of the Trust shall bind its successors and assigns, whether so
expressed or not.
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SECTION 13.4 Notices and Demands on Trust, Indenture Trustee and any
Holder.
(a) Except as otherwise provided by this Section, any notice or
demand which by any provision of the Indenture is required or
permitted to be given or served by the Indenture Trustee or by
any Holder of any Note to or on the Trust may be given or served
by being deposited postage prepaid, first-class mail (except as
otherwise specifically provided in the Indenture) addressed
(until another address of the Trust is filed by the Trust with
the Indenture Trustee) to the Delaware Trustee. Any notice,
direction, request or demand by the Trust or any Holder to or
upon the Indenture Trustee shall be deemed to have been
sufficiently given or made, for all purposes, if given or made at
the Corporate Trust Office.
(b) Where the Indenture provides for notice to any Holder, such
notice shall be sufficiently given (unless otherwise expressly
provided in the Indenture) if in writing and mailed, first-class
postage prepaid, to each Holder entitled thereto, at such
Holder's last address as it appears in the Note Register. In any
case where notice to any Holder is given by mail, neither the
failure to mail such notice, nor any defect in any notice so
mailed, to any particular Holder shall affect the sufficiency of
such notice with respect to any other Holder.
(c) Where the Indenture provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver
shall be the equivalent of such notice. Waivers of notice by any
Holder shall be filed with the Indenture Trustee, but such filing
shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
(d) If, by reason of the suspension of or irregularities in regular
mail service, it shall be impracticable to mail notice to the
Trust and each Holder when such notice is required to be given
pursuant to any provision of the Indenture, then any manner of
giving such notice as shall be satisfactory to the Indenture
Trustee shall be deemed to be a sufficient giving of such notice.
(e) The Trust shall deliver promptly to each rating agency then
rating the Notes copies of each of the following:
(i) any repurchase of Notes pursuant to Section 3.3;
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(ii) any notice of any default or Event of Default;
(iii) any notice of redemption provided by the Trust pursuant to
Section 3.1(d);
(iv) any notice of change in name, identity, organizational
structure, chief executive office, or chief place of
business of the Trust provided by the Trust pursuant to
Section 14.4(a);
(v) any Supplemental Indenture;
(vi) any resignation, removal or appointment under this
Indenture;
(vii) any amendment to any Funding Agreement; and
(viii) any other information reasonably requested by such rating
agency.
Any such notice shall be addressed to:
Standard & Poor's Ratings Services,
a division of The McGraw-Hill Companies, Inc.
55 Water Street
New York, NY 10041
Attention: Capital Markets
Facsimile: (212) 438-5215
Moody's Investors Service Inc.
99 Church Street
New York, NY 10007
Attention: Life Insurance Group
Facsimile: (212) 553-4805
or such other address previously furnished in writing to the Trust by the
applicable rating agency.
SECTION 13.5 Trust Certificates and Opinions of Counsel; Statements to be
Contained Therein.
(a) Except as otherwise expressly provided in the Indenture,
upon any application or demand by the Trust to the Indenture
Trustee to take any action under any of the provisions of
the Indenture, the Trust shall furnish to the Indenture
Trustee a Trust Certificate stating that all conditions
precedent, if any, provided for in the
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Indenture relating to the proposed action have been complied
with and an Opinion of Counsel stating that in the opinion
of the applicable counsel all such conditions precedent, if
any, have been complied with, except that in the case of any
such application or demand as to which the furnishing of
such documents is specifically required by any provision of
the Indenture relating to such particular application or
demand, no additional certificate or opinion need be
furnished.
(b) Each certificate or opinion provided for in the Indenture
and delivered to the Indenture Trustee with respect to
compliance with a condition or covenant provided for in the
Indenture shall include:
(i) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements
or opinions contained in such certificate or opinion
are based;
(iii) a statement that, in the opinion of such Person, he
has made such examination or investigation or has
received such certificates, opinions, representations
or statements of counsel or accountants pursuant to
paragraphs (c) or (d) of this Section, as are necessary
to enable him to express an informed opinion as to
whether or not such covenant or condition has been
complied with; and
(iv) a statement as to whether or not, in the opinion of
such Person, such condition or covenant has been
complied with.
(c) Any certificate, statement or opinion of the Trust may be
based upon a certificate or opinion of or representations by
counsel, unless the Trust knows that the certificate or
opinion or representations with respect to the matters upon
which his certificate, statement or opinion may be based as
aforesaid are erroneous, or in the exercise of reasonable
care should know that the same are erroneous. Any
certificate, statement or opinion of counsel may be based,
insofar as it relates to factual matters information with
respect to which is in the possession of the Trust, upon the
certificate, statement or opinion of or representations by
the Trust, unless such counsel knows that the
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certificate, statement or opinion or representations with
respect to the matters upon which the certificate, statement
or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same
are erroneous.
(d) Any certificate, statement or opinion of the Trust or of
counsel may be based, insofar as it relates to accounting
matters, upon a certificate or opinion of or representations
by an accountant or firm of accountants in the employ of the
Trust, unless such officer or counsel, as the case may be,
knows that the certificate or opinion or representations
with respect to the accounting matters upon which the
certificate, statement or opinion may be based as aforesaid
are erroneous, or in the exercise of reasonable care should
know that the same are erroneous.
(e) Any certificate or opinion of any independent firm of public
accountants filed with the Indenture Trustee shall contain a
statement that such firm is independent.
SECTION 13.6 Governing Law. Pursuant to Section 5-1401 of the General
Obligations Law of the State of New York, the Indenture and the Notes shall
(unless specified otherwise in the Note Certificate) be governed by, and
construed in accordance with, the laws of the State of New York, except as
required by mandatory provisions of law and except to the extent that the
validity or perfection of the Trust's ownership of and security interest in the
Funding Agreement(s) or remedies under the Indenture in respect thereof may be
governed by the laws of a jurisdiction other than the State of New York. All
judicial proceedings brought against the Trust or the Indenture Trustee arising
out of or relating to the Indenture, any Note or any portion of the Collateral
or other assets of the Trust may be brought in any state or Federal court in the
State of New York, provided that a Note Certificate may specify other
jurisdictions as to which the Trust may consent to the nonexclusive jurisdiction
of its courts with respect to the Notes.
SECTION 13.7 Counterparts. The Indenture 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.
SECTION 13.8 Trust Indenture Act to Control. If and to the extent that any
provision of the Indenture limits, qualifies or conflicts with any duties under
any required provision of the Trust Indenture Act imposed on the Indenture by
Section 318(c) of the Trust Indenture Act, such provision of the Trust Indenture
Act shall control.
SECTION 13.9 Judgment Currency. The Trust will indemnify the Holder of any
Note against any loss incurred as a result of any judgment or order being given
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or made for any amount due under such Note and that judgment or order requiring
payment in a currency (the "Judgment Currency") other than the Specified
Currency, and as a result of any variation between:
(a) the rate of exchange at which the Specified Currency amount is
converted into the Judgment Currency for the purpose of that
judgment or order; and
(b) the rate of exchange at which the Holder, on the date of payment
of that judgment or order, is able to purchase the Specified
Currency with the amount of the Judgment Currency actually
received.
ARTICLE 14
SECURITY INTEREST
SECTION 14.1 Security Interest.
(a) To secure the full and punctual payment of the Obligations in
accordance with the terms of the Indenture and to secure the
performance of the Trust's obligations under the Notes and the
Indenture, the Trust pledges and collaterally assigns to and with
the Indenture Trustee for the benefit of each Holder of each Note
and any other Person for whose benefit the Indenture Trustee is
or will be holding the Collateral (the "Secured Parties"), and
grants to the Indenture Trustee for the benefit of each Secured
Party, a security interest in the Collateral, and all of the
rights and privileges of the Trust in and to the Collateral (the
"Security Interest"), effective as of the Original Issue Date of
the Notes.
(b) It is expressly agreed that anything therein contained to the
contrary notwithstanding, the Trust shall remain liable under
each Funding Agreement to perform all the obligations assumed by
it thereunder, all in accordance with and pursuant to the terms
and provisions thereof, and the Indenture Trustee shall not have
any obligations or liabilities by reason of or arising out of the
Indenture, nor shall the Indenture Trustee be required or
obligated in any manner to perform or fulfill any obligations of
the Trust under or pursuant to such Funding Agreement or to make
any payment, to make any inquiry as to the nature or sufficiency
of any payment received by it, or, prior to the occurrence and
continuance of an Event of Default, to present or file any claim,
or to take any action to collect or enforce the payment of any
amounts that may have been assigned to it or to which it may be
entitled at any time or times.
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(c) The Indenture Trustee acknowledges the grant of the Security
Interest upon the issuance of the Notes, accepts the trusts under
the Indenture in accordance with the provisions of the Indenture
and agrees to perform its duties in the Indenture to the end that
the interests of each Secured Party may be adequately and
effectively protected.
SECTION 14.2 Representations and Warranties. The Trust represents and
warrants as of the date of the Indenture as follows:
(a) The Trust owns each Funding Agreement that secures the
Obligations and all of the rest of the Collateral, free and clear
of any Liens other than the Security Interest in the Collateral.
(b) The Trust has not performed any acts which might prevent the
Indenture Trustee from enforcing any of the terms of the
Indenture or which would limit the Indenture Trustee in any such
enforcement. Other than financing statements or other similar or
equivalent documents or instruments with respect to the Security
Interest, no financing statement, mortgage, security agreement or
similar or equivalent document or instrument covering all or any
part of the Collateral is on file or of record in any
jurisdiction in which such filing or recording would be effective
to perfect a Lien on such Collateral. No Collateral is in the
possession of any Person (other than the Trust or its agent)
asserting any claim thereto or security interest therein, except
that the Indenture Trustee or its designee may have possession of
Collateral as contemplated by the Indenture.
(c) Each Security Interest constitutes a valid security interest
securing the Obligations. When (i) the financing statements shall
have been filed in the appropriate offices in Illinois, Delaware
and New York, (ii) the Indenture Trustee or its agent shall have
taken possession of each applicable Funding Agreement, (iii) the
Trust shall have pledged and collaterally assigned each
applicable Funding Agreement to the Indenture Trustee and given
written notice to the Funding Agreement Provider of each such
assignment to the Indenture Trustee and (iv) the Funding
Agreement Provider shall have given its express written consent
to such pledge and collateral assignment and affirmed in writing
that the Funding Agreement Provider has changed its books and
records to reflect such pledge and collateral assignment to the
Indenture Trustee, such Security Interest shall constitute a
first priority perfected security interest in the Collateral,
enforceable
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against the Trust, the Trust's creditors and any purchaser from
the Trust.
SECTION 14.3 Additional Representations and Warranties. The Trust
represents and warrants as of the date of the Indenture that:
(a) to the extent the creation of a security interest in any Funding
Agreement is governed by the applicable UCC, the Indenture
creates a valid security interest (as defined in the applicable
UCC) in each Funding Agreement in favor of the Indenture Trustee
for the benefit and security of the Secured Parties, which
security interest is prior to all other Liens;
(b) to the extent the UCC applies, each Funding Agreement consists of
"general intangibles," "payment intangibles" and/or "instruments"
within the meaning of the applicable UCC;
(c) subject to the grant of security interest, pledge and collateral
assignment of the Trust's estate, right, title and interest in
each Funding Agreement, the Trust is a party to and is the Person
entitled to payment under each Funding Agreement on the date of
the Indenture free and clear of any Lien, claim or encumbrance of
any Person, other then the Lien created under the Indenture or
any Lien otherwise permitted under the Indenture;
(d) to the extent the UCC applies, the Trust has caused or will have
caused, within ten days after the date of the Indenture, the
filing of all appropriate financing statements in the proper
filing office in the appropriate jurisdictions under applicable
law in order to perfect the security interest in each Funding
Agreement granted to the Indenture Trustee for the benefit and
security of the Secured Parties under the Indenture;
(e) all original executed copies of each instrument that constitutes
or evidences each Funding Agreement have been delivered to the
Indenture Trustee or a custodian for the Indenture Trustee (the
"Custodian");
(f) where all original executed copies of each instrument that
constitutes or evidences each Funding Agreement have been
delivered to the Custodian, the Trust has received a written
acknowledgment from the Custodian that the Custodian is holding
the instruments that constitute or evidence each Funding
Agreement solely on behalf of the Indenture Trustee;
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(g) other than the security interest granted to the Indenture Trustee
for the benefit and security of the Secured Parties pursuant to
the Indenture, the Trust has not pledged, assigned, sold, granted
a security interest in, or otherwise conveyed any of the Funding
Agreements;
(h) the Trust has not authorized the filing of and is not aware of
any financing statements against the Trust that include a
description of collateral covering the Funding Agreement other
than any financing statement relating to the security interest
granted to the Indenture Trustee for the benefit and security of
the Secured Parties under the Indenture or that has been
terminated;
(i) the Trust is not aware of any judgment or tax lien filings
against the Trust; and
(j) none of the instruments that constitute or evidence the Funding
Agreements has any marks or notations indicating that they have
been pledged, assigned or otherwise conveyed to any Person other
than the Indenture Trustee for the benefit and security of the
Secured Parties.
The foregoing representations and warranties shall survive the execution
and delivery of the Notes. No party to the Indenture shall waive any of the
foregoing representations and warranties. Subject to Section 14.9, The Trust
shall maintain the perfection and priority of the security interest in each
Funding Agreement.
SECTION 14.4 Further Assurances; Covenants.
(a) The Trust will not change its name, identity or organizational
structure in any manner unless it shall have given the Indenture
Trustee at least 30 days' prior notice thereof. The Trust will
not change the location of its chief executive office or chief
place of business unless it shall have given the Indenture
Trustee at least 30 days' prior notice thereof.
(b) The Trust will, from time to time and upon advice of counsel, at
the Trust's expense, execute, deliver, file and record any
statement, assignment, instrument, document, agreement or other
paper and take any other action, (including, without limitation,
any filings of financing or continuation statements) that from
time to time may be necessary or desirable, or that the Indenture
Trustee may reasonably request, in order to create, preserve,
perfect, confirm or validate a Security Interest or to enable the
Holders of Notes to obtain the full benefits of the Indenture, or
to
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enable the Indenture Trustee to exercise and enforce any of its
rights, powers and remedies under the Indenture with respect to
any Collateral. To the extent permitted by applicable law, the
Trust authorizes the Indenture Trustee to execute and file
financing statements or continuation statements without the
Trust's signature appearing thereon. The Trust agrees that a
carbon, photographic, photostatic or other reproduction of the
Indenture or of a financing statement is sufficient as a
financing statement. The Trust shall pay the costs of, or
incidental to, any recording or filing of any financing or
continuation statements concerning any Collateral.
(c) If any Collateral is at any time in the possession or control of
any warehouseman, bailee or any of the Trust's agents or
processors, the Trust shall notify such warehouseman, bailee,
agent or processor of the Security Interest created by the
Indenture and to hold all such Collateral for the Indenture
Trustee's account subject to the Indenture Trustee's
instructions.
(d) The Trust will, promptly upon request, provide to the Indenture
Trustee all information and evidence it may reasonably request
concerning the Collateral to enable the Indenture Trustee to
enforce the provisions of the Indenture.
(e) Not more than six months nor less than 30 days prior to each date
on which the Trust proposes to take any action contemplated by
Section 14.4(a), the Trust shall, at its cost and expense, cause
to be delivered to the Indenture Trustee an Opinion of Counsel,
satisfactory to the Indenture Trustee, to the effect that all
financing statements and amendments or supplements thereto,
continuation statements and other documents required to be
recorded or filed in order to perfect and protect the Security
Interest for a period, specified in such Opinion of Counsel,
continuing until a date not earlier than 18 months from the date
of such Opinion of Counsel, against all creditors of and
purchasers from the Trust have been filed in each filing office
necessary for such purpose and that all filing fees and taxes, if
any, payable in connection with such filings have been paid in
full.
(f) From time to time upon request by the Indenture Trustee, the
Trust shall, at its cost and expense, cause to be delivered to
the Indenture Trustee an Opinion of Counsel satisfactory to the
Indenture Trustee as to such matters relating to the Security
Interest as the Indenture Trustee or the Holder Representative
may reasonably request.
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SECTION 14.5 General Authority. The Trust irrevocably appoints the
Indenture Trustee its true and lawful attorney, with full power of substitution,
in the name of the Trust, the Indenture Trustee, the Holders of Notes or
otherwise, for the sole use and benefit of the Secured Parties, but at the
Trust's expense, to the extent permitted by law to exercise, at any time and
from time to time while an Event of Default has occurred and is continuing, all
or any of the following powers with respect to all or any of the Collateral:
(a) to demand, sue for, collect, receive and give acquittance for any
and all monies due or to become due thereon or by virtue thereof,
(b) to settle, compromise, compound, prosecute or defend any action
or proceeding with respect thereto,
(c) to sell, transfer, assign or otherwise deal in or with the same
or the proceeds or avails thereof, as fully and effectually as if
the Indenture Trustee were the absolute owner thereof, and
(d) to extend the time of payment of any or all thereof and to make
any allowance and other adjustments with reference thereto;
provided that the Indenture Trustee shall give the Trust not less than 10 days'
prior notice of the time and place of any sale or other intended disposition of
any of the Collateral, except any part of the Collateral which threatens to
decline speedily in value or is of a type customarily sold on a recognized
market.
SECTION 14.6 Remedies Upon Event of Default. If any Event of Default has
occurred and is continuing, the Indenture Trustee may exercise on behalf of the
Secured Parties all rights of a secured party under applicable law and, in
addition, the Indenture Trustee may, without being required to give any notice,
except as provided in the Indenture or as may be required by mandatory
provisions of law, (i) apply all cash, if any, then held by it as all or part of
the Collateral as specified in Section 5.3 and (ii) if there shall be no such
cash or if such cash shall be insufficient to pay all the Obligations in full,
sell the Collateral (including each applicable Funding Agreement) or any part
thereof at public or private sale, for cash, upon credit or for future delivery,
and at such price or prices as the Indenture Trustee may deem satisfactory. Any
Holder may be the purchaser of any or all of the Collateral so sold at any
public sale (or, if the Collateral is of a type customarily sold in a recognized
market or is of a type which is the subject of widely distributed standard price
quotations, at any private sale). The Trust will execute and deliver such
documents and take such other action as the Indenture Trustee deems necessary or
advisable in order that any such sale may be made in compliance with law. Upon
any such sale the Indenture Trustee shall have the right to deliver, assign and
transfer to the purchaser thereof the Collateral so sold. Each purchaser at any
such sale shall hold the Collateral so sold to it absolutely and free from any
claim or right of whatsoever kind, including any equity or right of redemption
of the Trust which may be
88
waived, and the Trust, to the extent permitted by law, specifically waives all
rights of redemption, stay or appraisal which it has or may have under any law.
The notice (if any) of such sale shall (A) in the case of a public sale, state
the time and place fixed for such sale, and (B) in the case of a private sale,
state the day after which such sale may be consummated. Any such public sale
shall be held at such time or times within ordinary business hours and at such
place or places as the Indenture Trustee may fix in the notice of such sale. At
any such sale the Collateral may be sold in one lot as an entirety or in
separate parcels, as the Indenture Trustee may determine. The Indenture Trustee
shall not be obligated to make any such sale pursuant to any such notice. The
Indenture Trustee may, without notice or publication, adjourn any public or
private sale or cause the same to be adjourned from time to time by announcement
at the time and place fixed for the sale, and such sale may be made at any time
or place to which the same may be so adjourned. In the case of any sale of all
or any part of the Collateral on credit or for future delivery, the Collateral
so sold may be retained by the Indenture Trustee until the selling price is paid
by the purchaser thereof, but the Indenture Trustee shall not incur any
liability in the case of the failure of such purchaser to take up and pay for
the Collateral so sold and, in the case of any such failure, such Collateral may
again be sold upon like notice. The Indenture Trustee, instead of exercising the
power of sale conferred upon it in the Indenture, may proceed by a suit or suits
at law or in equity to foreclose a Security Interest and sell any Collateral, or
any portion thereof, under a judgment or decree of a court or courts of
competent jurisdiction.
SECTION 14.7 Limitation on Duties of Indenture Trustee with Respect to
Collateral. Beyond the exercise of reasonable care in the custody thereof, the
Indenture Trustee shall have no duty as to any portion of the Collateral in its
possession or control or in the possession or control of any agent or bailee or
as to the preservation of rights against prior parties or any other rights
pertaining thereto. The Indenture Trustee shall be deemed to have exercised
reasonable care in the custody of the Collateral in its possession if the
Collateral is accorded treatment substantially equal to that which it accords
property it holds in its fiduciary capacity generally, and shall not be liable
or responsible for any loss or damage to any of the Collateral, or for any
diminution in the value thereof, by reason of the act or omission of any
warehouseman, carrier, forwarding agency, consignee or other agent or bailee
selected by the Indenture Trustee in good faith.
SECTION 14.8 Concerning the Indenture Trustee. In furtherance and not in
derogation of the rights, privileges and immunities of the Indenture Trustee
specified in the Indenture:
(a) the Indenture Trustee is authorized to take all such action as is
provided to be taken by it as Indenture Trustee under this
Article and all other action reasonably incidental thereto. As to
any matters not expressly provided for in this Article
(including, without limitation, the timing and methods of
realization upon any Collateral) the Indenture Trustee shall act
or refrain from
89
acting in accordance with written instructions from the Holder or
Holders of the required percentage of aggregate principal amount
of Notes for any instructions or, in the absence of such
instructions, in accordance with its discretion; and
(b) the Indenture Trustee shall not be responsible for the existence,
genuineness or value of any of the Collateral or for the
validity, perfection, priority or enforceability of the Security
Interest in any of the Collateral, whether impaired by operation
of law or by reason of any action or omission to act on its part
under the Indenture.
SECTION 14.9 Termination of Security Interest. Upon the repayment in full
of all Obligations, the Security Interest shall terminate and all rights to the
Collateral shall revert to the Trust. Upon such termination of a Security
Interest, and delivery of a certificate by the Trust to such effect, the
Indenture Trustee will, at the expense of the Trust, execute and deliver to the
Trust such documents as the Trust shall reasonably request to evidence the
termination of the Security Interest.
90
EXHIBIT A-1
FORM OF GLOBAL SECURITY FOR SECURED MEDIUM TERM NOTES PROGRAM
A1-1
EXHIBIT A-2
FORM OF DEFINITIVE SECURITY FOR SECURED MEDIUM TERM NOTES PROGRAM
A2-1
EXHIBIT A-3
FORM OF GLOBAL SECURITY FOR ALLSTATE LIFE(R) CORENOTES(R) PROGRAM
A3-1
EXHIBIT A-4
FORM OF DEFINITIVE SECURITY FOR ALLSTATE LIFE(R) CORENOTES(R) PROGRAM
A4-1
EXHIBIT B
FORM OF CERTIFICATE OF AUTHENTICATION
This Note Certificate is one of the Note Certificates representing
Notes described in the within-mentioned Indenture.
J.P. MORGAN TRUST COMPANY, NATIONAL
ASSOCIATION,
as Funding Note Indenture Trustee
By:
----------------------------
Authorized Signatory
Dated:
B-1
EXHIBIT C
FORM OF INDENTURE TRUSTEE REPORT PURSUANT TO SECTION 7.3(f)
Allstate Life Global Funding Trusts
Indenture Trustee Report for Payment Date -:
(i) the amount received by the Indenture Trustee as of the last Payment Date in
respect of the principal, interest and premium, if any, on Funding
Agreements issued by Allstate Life Insurance Company ("Allstate Life"),
(ii) the amount of payment on such Payment Date to holders allocable to
principal and premium, if any, and interest on the Notes of the Trusts and
the amount of aggregate unpaid interest accrued on such Notes as of such
Payment Date.
(iii) the aggregate original stated principal amount of the Funding Agreements,
the current interest rate thereon at the close of business on such Payment
Date, and
(iv) the aggregate principal balance of the Notes at the close of business on
such Payment Date.
TRUST NO. / FUNDING AGREEMENT NO(S). / CUSIP / ISSUE DATE / MATURITY / TYPE /
RATE / INTEREST DUE / UNPAID INTEREST ACCRUED / * PRINCIPAL DUE / ORIGINAL
OUTSTANDING / CURRENT OUTSTANDING(1)
(v) the amounts of compensation received by the Indenture Trustee during the
period relating to such Payment Date.
Paid by the Trust: -
Paid by Allstate Life: -
* Principal Due includes any applicable premium.
- --------
(1) To be in chart format on actual report. These items are column titles.
C-1
EXHIBIT 4.6
===============================================================================
STANDARD FUNDING NOTE INDENTURE TERMS
with respect to
ALLSTATE LIFE GLOBAL FUNDING
SECURED MEDIUM-TERM NOTES
and
ALLSTATE LIFE(R) CORENOTES(R)
===============================================================================
Allstate Life(R) is a registered service mark of Allstate Insurance Company.
CoreNotes(R) is a registered service mark of Merrill Lynch & Co., Inc.
TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS
SECTION 1.1 Certain Terms Defined.......................................................1
SECTION 1.2 Interpretation.............................................................11
ARTICLE 2
THE FUNDING NOTE
SECTION 2.1 Amount Unlimited...........................................................12
SECTION 2.2 Status of Funding Note.....................................................12
SECTION 2.3 Forms Generally............................................................12
SECTION 2.4 Currency; Denominations....................................................13
SECTION 2.5 Execution, Authentication, Delivery and Date...............................14
SECTION 2.6 Registration, Transfer and Exchange........................................15
SECTION 2.7 Mutilated, Destroyed, Lost or Stolen Funding Note Certificates.............16
SECTION 2.8 Interest Record Dates......................................................18
SECTION 2.9 Cancellation...............................................................18
SECTION 2.10 Withholding Tax............................................................19
SECTION 2.11 Tax Treatment..............................................................19
ARTICLE 3
REDEMPTION, REPAYMENT AND REPURCHASE OF FUNDING NOTE; SINKING FUNDS
SECTION 3.1 Redemption of Funding Note.................................................20
SECTION 3.2 Repayment at the Option of the Holder......................................23
SECTION 3.3 Repurchase of Funding Note.................................................24
SECTION 3.4 Sinking Funds..............................................................25
ARTICLE 4
PAYMENTS; FUNDING NOTE PAYING AGENTS AND FUNDING NOTE CALCULATION AGENT; COVENANTS
SECTION 4.1 Payment of Principal and Interest..........................................26
SECTION 4.2 Collection Account.........................................................28
SECTION 4.3 Offices for Payments, Etc..................................................29
SECTION 4.4 Appointment to Fill a Vacancy in Office of Funding Note Indenture
Trustee....................................................................29
SECTION 4.5 Funding Note Paying Agents.................................................30
SECTION 4.6 Funding Note Calculation Agent.............................................34
SECTION 4.7 Certificate to Funding Note Indenture Trustee..............................37
i
SECTION 4.8 Negative Covenants.........................................................37
SECTION 4.9 Non-Petition...............................................................37
SECTION 4.10 Additional Amounts.........................................................38
ARTICLE 5
REMEDIES OF THE FUNDING NOTE INDENTURE TRUSTEE AND HOLDERS ON EVENT OF DEFAULT
SECTION 5.1 Event of Default Defined; Acceleration of Maturity;
Waiver of Default..........................................................40
SECTION 5.2 Collection of Indebtedness by Funding Note Indenture
Trustee; Funding Note Indenture Trustee May Prove
Debt.......................................................................43
SECTION 5.3 Application of Proceeds....................................................46
SECTION 5.4 Suits for Enforcement......................................................48
SECTION 5.5 Restoration of Rights on Abandonment of Proceedings........................48
SECTION 5.6 Limitations on Suits by Holders............................................48
SECTION 5.7 Powers and Remedies Cumulative; Delay or Omission
Not Waiver of Default......................................................49
SECTION 5.8 Control by the Holders.....................................................50
SECTION 5.9 Waiver of Past Defaults....................................................51
ARTICLE 6
THE FUNDING NOTE INDENTURE TRUSTEE
SECTION 6.1 Certain Duties and Responsibilities........................................51
SECTION 6.2 Certain Rights of the Funding Note Indenture Trustee.......................53
SECTION 6.3 Not Responsible for Recitals, Validity of the Funding Note or
Application of the Proceeds................................................54
SECTION 6.4 May Hold Funding Note; Collections, Etc....................................55
SECTION 6.5 Funds Held by Funding Note Indenture Trustee...............................55
SECTION 6.6 Compensation; Reimbursement; Indemnification...............................55
SECTION 6.7 Corporate Trustee Required; Eligibility....................................56
SECTION 6.8 Resignation and Removal; Appointment of Successor Trustee..................57
SECTION 6.9 Acceptance of Appointment by Successor Funding Note Trustee................59
SECTION 6.10 Merger, Conversion, Consolidation or Succession to Business of
Funding Note Indenture Trustee.............................................60
SECTION 6.11 Limitations on Rights of Funding Note Indenture Trustee as Creditor........60
ii
ARTICLE 7
HOLDERS' LISTS AND REPORTS BY FUNDING NOTE INDENTURE TRUSTEE AND GLOBAL FUNDING
SECTION 7.1 Global Funding to Furnish Funding Note Indenture Trustee Names and
Addresses of Holders.......................................................61
SECTION 7.2 Preservation of Information; Communication to Holders......................61
SECTION 7.3 Reports by Funding Note Indenture Trustee..................................61
SECTION 7.4 Reports by Global Funding..................................................62
SECTION 7.5 Reports on Assessment of Compliance with Servicing Criteria and
Compliance Statements; Attestation Reports of Registered Public
Accounting Firm............................................................63
ARTICLE 8
CONCERNING EACH HOLDER
SECTION 8.1 Evidence of Action Taken by a Holder.......................................64
SECTION 8.2 Proof of Execution of Instruments and of Holding of Funding Note...........65
SECTION 8.3 Voting Record Date.........................................................65
SECTION 8.4 Persons Deemed to be Owners................................................65
SECTION 8.5 Right of Revocation of Action Taken; Binding Effect of Actions by
Holders....................................................................65
ARTICLE 9
SUPPLEMENTAL FUNDING NOTE INDENTURES
SECTION 9.1 Supplemental Funding Note Indentures Without Consent of Holders............66
SECTION 9.2 Supplemental Funding Note Indentures with Consent of Holders...............68
SECTION 9.3 Compliance with Trust Indenture Act; Effect of Supplemental Funding
Note Indentures............................................................69
SECTION 9.4 Documents to Be Given to Funding Note Indenture Trustee....................69
SECTION 9.5 Notation on Funding Note Certificate in Respect of Supplemental
Funding Note Indentures....................................................69
SECTION 9.6 Amendment to Funding Agreement(s)..........................................70
ARTICLE 10
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 10.1 Global Funding May Merge, Consolidate, Sell or Convey Property
Under Certain Circumstances................................................71
iii
ARTICLE 11
SATISFACTION AND DISCHARGE OF FUNDING NOTE INDENTURE; UNCLAIMED FUNDS
SECTION 11.1 Satisfaction and Discharge of Funding Note Indenture.......................72
SECTION 11.2 Application by Funding Note Indenture Trustee of Funds Deposited
for Payment of Funding Note................................................73
SECTION 11.3 Repayment of Funds Held by Funding Note Paying Agent.......................73
SECTION 11.4 Return of Funds Held by Funding Note Indenture Trustee and Funding
Note Paying Agent..........................................................73
ARTICLE 12
MEETINGS OF HOLDERS OF FUNDING NOTE
SECTION 12.1 Purposes for Which Meetings May Be Called..................................74
SECTION 12.2 Call, Notice and Place of Meetings.........................................74
SECTION 12.3 Persons Entitled to Vote at Meetings.......................................75
SECTION 12.4 Quorum; Action.............................................................75
SECTION 12.5 Determination of Voting Rights; Conduct of Adjournment of Meetings.........76
SECTION 12.6 Counting Votes and Recording Action of Meetings............................77
ARTICLE 13
MISCELLANEOUS PROVISIONS
SECTION 13.1 No Recourse................................................................78
SECTION 13.2 Provisions of Funding Note Indenture for the Sole Benefit of
Parties and Holders........................................................78
SECTION 13.3 Successors and Assigns of Global Funding Bound by Indenture................79
SECTION 13.4 Notices and Demands on Global Funding, Funding Note Indenture
Trustee and any Holder.....................................................79
SECTION 13.5 Trust Certificates and Opinions of Counsel; Statements to be
Contained Therein..........................................................81
SECTION 13.6 Governing Law..............................................................82
SECTION 13.7 Counterparts...............................................................83
SECTION 13.8 Trust Indenture Act to Control.............................................83
SECTION 13.9 Judgment Currency..........................................................83
ARTICLE 14
SECURITY INTEREST
SECTION 14.1 Security Interest..........................................................83
SECTION 14.2 Representations and Warranties.............................................84
SECTION 14.3 Additional Representations and Warranties..................................85
SECTION 14.4 Further Assurances; Covenants..............................................87
iv
SECTION 14.5 General Authority..........................................................88
SECTION 14.6 Remedies Upon Event of Default.............................................89
SECTION 14.7 Limitation on Duties of Funding Note Indenture Trustee with Respect
to Collateral..............................................................90
SECTION 14.8 Concerning the Funding Note Indenture Trustee..............................90
SECTION 14.9 Termination of Security Interest...........................................91
EXHIBIT A-1 Form of Funding Note Certificate Related to Secured Medium Term Notes A-1-1
Issued Under the Secured Medium Term Notes Program
EXHIBIT A-2 Form of Funding Note Certificate Related to Secured Medium Term Notes A-2-1
Issued Under The Allstate Life(R) CoreNotes(R) Program
EXHIBIT B Form of Certificate of Authentication B-1
EXHIBIT C Form of Funding Note Indenture Trustee Report Pursuant to Section 7.3(f) C-1
v
This document constitutes the Standard Funding Note Indenture Terms, which
will be incorporated by reference in the Funding Note Indenture (as defined
below), by and among Global Funding (as defined below) and the Funding Note
Indenture Trustee, Funding Note Calculation Agent, Funding Note Exchange Rate
Agent, Funding Note Paying Agent and Funding Note Registrar (as defined below).
These Standard Funding Note Indenture Terms shall be of no force and effect
unless and until incorporated by reference into, and then only to the extent not
modified by, such Funding Note Indenture.
The following Standard Funding Note Indenture Terms shall govern the
Funding Note subject to contrary terms and provisions expressly adopted in the
Funding Note Indenture, any Supplemental Funding Note Indenture or the Funding
Note, which contrary terms shall be controlling.
ARTICLE 1
DEFINITIONS
SECTION 1.1 Certain Terms Defined. The following terms shall have the
meanings specified in this Section for all purposes of the Funding Note
Indenture and the Funding Note, unless otherwise expressly provided. All other
terms used in the Funding Note Indenture which are defined in the Trust
Indenture Act or which are by reference therein defined in the Securities Act
shall have the meanings (except as otherwise expressly provided in the Funding
Note Indenture or unless the context otherwise clearly requires) assigned to
such terms in the Trust Indenture Act and in the Securities Act as in force at
the date of the Funding Note Indenture as originally executed.
"Additional Amounts" means any additional amounts which may be required by
the Funding Note, under circumstances specified in the Funding Note Certificate
or Supplemental Funding Note Indenture, to be paid by Global Funding in respect
of certain taxes, assessments or other governmental charges imposed on Holders
specified therein and which are owing to such Holders.
"Administrative Services Agreement" means that certain administrative
services agreement included in Part B of the Series Instrument, by and between
the Trust and the Administrator, as the same may be amended, supplemented,
modified, restated or replaced from time to time.
"Administrator" means AMACAR Pacific Corp., a Delaware corporation, in its
capacity as the sole administrator of the Trust, or another entity specified in
the Funding Note Indenture as the Administrator, and, in each case, its
permitted successors and assigns.
1
"Affiliate" means, as applied to any Person, any other Person directly or
indirectly controlling, controlled by, or under common control with, that Person
and, in the case of an individual, any spouse or other member of that
individual's immediate family. For the purposes of this definition, "control"
(including with correlative meanings, the terms "controlling", "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of that Person, whether through the
ownership of voting securities or by contract or otherwise.
"Agents" has the meaning ascribed in the Distribution Agreement.
"Amended and Restated Administrative Services Agreement" means that certain
Amended and Restated Administrative Services Agreement dated as of -, 2006,
between the Global Funding Administrator and Global Funding, as the same may be
amended, supplemented, modified, restated or replaced from time to time.
"Amended and Restated Support Agreement" means that certain Amended and
Restated Support and Expenses Agreement dated as of -, 2006, between the Funding
Agreement Provider and Global Funding, as the same may be amended, supplemented,
modified, restated or replaced from time to time.
"Amended and Restated Trust Agreement" means that certain Amended and
Restated Trust Agreement of Global Funding dated as of -, 2006, as the same may
be amended, supplemented, modified, restated or replaced from time to time.
"Annual Redemption Percentage Reduction" has the meaning ascribed in the
Funding Note Certificate or the Funding Note Indenture.
"Annual Report" has the meaning ascribed in Section 7.5.
"Business Day" means (except as otherwise provided in the Pricing
Supplement) any day, other than a Saturday or Sunday, that is neither a legal
holiday nor a day on which commercial banks are authorized or required by law,
regulation or executive order to close in The City of New York; provided,
however, that, if the Specified Currency of the Funding Note is other than U.S.
Dollars, the day must also not be a day on which commercial banks are authorized
or required by law, regulation or executive order to close in the Principal
Financial Center of the country issuing the Specified Currency (or, if the
Specified Currency is Euro, the day must also be a day on which the Target
System is open).
"Closing Instrument" means the closing instrument of the Trust, pursuant to
which certain documents are executed, in connection with the issuance of the
Notes by the Trust and the issuance of the Funding Note by Global Funding.
2
"Code" means the United States Internal Revenue Code of 1986, as amended,
including any successor statutes and any applicable rules, regulations, notices
or orders promulgated thereunder.
"Collateral" means, with respect to the Funding Note, the right, title and
interest of Global Funding in and to (i) each Funding Agreement issued to Global
Funding, (ii) all Proceeds in respect of each such Funding Agreement and (iii)
all books and records (including without limitation, computer programs,
printouts and other computer materials and files) of Global Funding pertaining
to the Funding Agreement(s).
"Collection Account" has the meaning ascribed in Section 4.2.
"Commission" means the Securities and Exchange Commission or any successor
body.
"Compliance Report" has the meaning ascribed in Section 7.5.
"Coordination Agreement" means that certain Coordination Agreement included
in Part F of the Series Instrument, among the Trust and the other parties
specified therein, as the same may be amended, supplemented, modified, restated
or replaced from time to time.
"Corporate Trust Office" means the office of the Funding Note Indenture
Trustee at which the Funding Note Indenture shall, at any particular time, be
principally administered, which office is, at the date as of which the Funding
Note Indenture is executed, located at 227 W. Monroe Street, Suite 2600,
Chicago, IL 60606, except that for the purposes of Section 4.3 it shall be 4 New
York Plaza, 1st Floor, New York, NY 10004, or such other location as may be
specified in or pursuant to the Funding Note Certificate or the Funding Note
Indenture.
"Debt" of any Person means, at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of
business, all obligations of such Person as lessee which are capitalized in
accordance with generally accepted accounting principles, (iv) all contingent
and non-contingent obligations of such Person to reimburse any bank or other
Person in respect of amounts paid under a letter of credit or similar
instrument, (v) all Debt secured by a Lien on any asset of such Person, whether
or not such Debt is otherwise an obligation of such Person, and (vi) all
Guarantees by such Person of Debt of another Person (each such Guarantee to
constitute Debt in an amount equal to the amount of such other Person's Debt
Guaranteed thereby).
"Defaulted Interest" has the meaning ascribed in Section 2.8(b).
3
"Delaware Trustee" means Wilmington Trust Company, a Delaware banking
corporation, or another entity specified in the Funding Note Indenture as the
Delaware Trustee, in each case not in its individual capacity but solely as
trustee and its successors.
"Distribution Agreement" means that certain Distribution Agreement dated as
of -, 2006, by and among Global Funding and the Agents named therein, as the
same may be amended, supplemented, modified, restated or replaced from time to
time.
"Euro" means the currency introduced at the start of the third stage of the
European economic and monetary union pursuant to the treaty establishing the
European Community, as amended by the Treaty on European Union.
"Event of Default" means any event or condition specified as such in
Section 5.1 which shall have continued for the period of time, if any, therein
designated.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Funding Agreement" means each funding agreement issued by the Funding
Agreement Provider to Global Funding, which is immediately pledged and
collaterally assigned to the Funding Note Indenture Trustee by Global Funding,
and immediately thereafter assigned absolutely to, and deposited into, the Trust
by Global Funding, as the same may be amended, supplemented, modified, restated
or replaced from time to time in accordance with the terms thereof.
"Funding Agreement Provider" means Allstate Life Insurance Company, a stock
life insurance company organized under the laws of the State of Illinois, and
its successors.
"Funding Note" means the funding note issued by Global Funding and
authenticated by the Funding Note Indenture Trustee under the Funding Note
Indenture, in an authorized denomination and represented by the Funding Note
Certificate.
"Funding Note Calculation Agent" means the Funding Note Indenture Trustee
in its capacity as calculation agent with respect to the Funding Note or any
other Person specified as calculation agent with respect to the Funding Note in
the Funding Note Certificate or the Funding Note Indenture, and, in each case,
its successors in such capacity.
"Funding Note Certificate" means a security certificate representing the
Funding Note.
"Funding Note Exchange Rate Agent" means the Funding Note Indenture Trustee
in its capacity as exchange rate agent with respect to the Funding Note or any
other Person specified as exchange rate agent with respect to the Funding Note
in the
4
Funding Note Certificate or the Funding Note Indenture, and, in each
case, its successors in such capacity.
"Funding Note Indenture" means that certain Funding Note Indenture included
in Part H of the Series Instrument, among Global Funding and the other parties
specified therein, as the same may be amended, supplemented, modified, restated
or replaced from time to time.
"Funding Note Indenture Trustee" means J.P. Morgan Trust Company, National
Association, or another entity specified as the Funding Note Indenture Trustee
in the Funding Note Indenture, and, in each case, its successors.
"Funding Note Paying Agent" means the Funding Note Indenture Trustee in its
capacity as paying agent with respect to the Funding Note and/or any other
Person specified as paying agent with respect to the Funding Note in the Funding
Note Certificate or the Funding Note Indenture, and, in each case, its
successors in such capacity.
"Funding Note Register" has the meaning ascribed in Section 2.6(a).
"Funding Note Registrar" has the meaning ascribed in Section 2.6(a).
"Global Funding" means Allstate Life Global Funding, a statutory trust
formed under the laws of the State of Delaware.
"Global Funding Administrator" means AMACAR Pacific Corp., a Delaware
corporation, in its capacity as the sole administrator of Global Funding, and
its permitted successors and assigns.
"Global Funding Trust Beneficial Owner" means AMACAR Pacific Corp., in its
capacity as the sole beneficial owner of Global Funding, and its successors.
"Guarantee" by any Person means any obligation, contingent or otherwise, of
such Person directly or indirectly guaranteeing any Debt of any other Person
and, without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Debt (whether
arising by virtue of partnership arrangements, by virtue of an agreement to
keep-well, to purchase assets, goods, securities or services, to take-or-pay, or
to maintain financial statement conditions or otherwise), (ii) to reimburse a
bank for amounts drawn under a letter of credit for the purpose of paying such
Debt or (iii) entered into for the purpose of assuring in any other manner the
holder of such Debt of the payment thereof or to protect such holder against
loss in respect thereof (in whole or in part); provided that the term
"Guarantee" shall not include endorsements for collection or deposit in the
ordinary course of business.
5
The term "Guarantee" used as a verb has a corresponding meaning.
"Holder" means each Person in whose name the Funding Note is registered in
the Funding Note Register.
"Holder Representative" has the meaning ascribed in Section 5.8(a).
"Immediate Redemption Price" has the meaning ascribed in Section 3.1(i).
"Indenture" means that certain Indenture included in Part G of the Series
Instrument, among the Trust and the other parties specified therein, as the same
may be amended, supplemented, modified, restated or replaced from time to time.
"Indenture Trustee" means J.P. Morgan Trust Company, National Association,
or another entity specified as the Indenture Trustee in the Indenture, and, in
each case, its successors.
"Initial Redemption Date" means, with respect to the Funding Note or
portion thereof to be redeemed pursuant to Section 3.1(b), the date on or after
which such Funding Note or portion thereof may be redeemed as determined by or
pursuant to the Funding Note Indenture or the Funding Note Certificate or
Supplemental Funding Note Indenture.
"Initial Redemption Percentage" has the meaning specified in the Funding
Note Certificate.
"Interest Payment Date" has the meaning ascribed in Section 2.8(a).
"Interest Reset Date" has the meaning ascribed in the Funding Note
Certificate.
"Investment Company Act" means the Investment Company Act of 1940, as
amended.
"Judgment Currency" has the meaning ascribed in Section 13.9.
"LIBOR", has the meaning ascribed in the Funding Note Certificate.
"LIBOR Currency" means the currency specified in the Funding Note
Certificate as to which LIBOR shall be calculated or, if no currency is
specified in the applicable Funding Note Certificate, United States dollars.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind, or any other type of
preferential arrangement that has substantially the same practical effect as a
security interest, in respect of such asset. For purposes hereof, Global Funding
shall be deemed to own subject to a Lien any asset which it has acquired or
holds subject to the interest of a
6
vendor or lessor under any conditional sale agreement, capital lease or other
title retention agreement relating to such asset.
"Market Exchange Rate" for a Specified Currency other than United States
dollars means the noon dollar buying rate in The City of New York for cable
transfers for the Specified Currency as certified for customs purposes (or, if
not so certified, as otherwise determined) by the Federal Reserve Bank of New
York.
"Maturity Date" means, with respect to the principal (or any installment of
principal) of the Funding Note, any date prior to the Stated Maturity Date on
which the principal (or such installment of principal) of the Funding Note
becomes due and payable whether, as applicable, by the declaration of
acceleration of maturity, notice of redemption at the option of Global Funding,
notice of the Holder's option to elect repayment or otherwise.
"Name Licensing Agreement" means that certain Name Licensing Agreement
included in Part D of the Series Instrument, between Allstate Insurance Company
and the Trust, as the same may be amended, supplemented, modified, restated or
replaced from time to time.
"Nonrecourse Parties" has the meaning ascribed in Section 13.1.
"Notes" has the meaning ascribed in the Indenture.
"Note Certificate" means a security certificate representing one or more
Notes.
"Obligations" means the obligations of Global Funding secured under the
Funding Note and the Funding Note Indenture, including (a) all principal of, any
premium and interest payable (including, without limitation, any interest which
accrues after the commencement of any case, proceeding or other action relating
to the bankruptcy, insolvency or reorganization of Global Funding, whether or
not allowed or allowable as a claim in any such proceeding) on, and any
Additional Amounts with respect to, the Funding Note or pursuant to the Funding
Note Indenture, (b) all other amounts payable by Global Funding under the
Funding Note Indenture or under the Funding Note including all costs and
expenses (including attorneys' fees) incurred by the Funding Note Indenture
Trustee or any Holder thereof in realizing on the Collateral to satisfy such
obligations and (c) any renewals or extensions of the foregoing.
"Opinion of Counsel" means an opinion in writing signed by legal counsel
who may be an employee of or counsel to Global Funding or the Funding Note
Indenture Trustee or who may be other counsel satisfactory to the Funding Note
Indenture Trustee. Each such opinion shall include the statements provided for
in Section 13.5 hereof, if and to the extent required hereby.
"Original Issue Date" shall have the meaning set forth in the Pricing
Supplement.
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"Owner" shall, with respect to each Funding Agreement, have the meaning
ascribed in such Funding Agreement.
"Person" means any natural person, corporation, limited partnership,
general partnership, joint stock company, joint venture, association, company,
limited liability company, trust (including any beneficiary thereof), bank,
trust company, land trust, trust or other organization, whether or not a legal
entity, and any government or any agency or political subdivision thereof.
"Pricing Supplement" means the pricing supplement included as Annex A to
the Series Instrument.
"Principal Amount" with respect to a Funding Agreement, has the meaning
ascribed in such Funding Agreement.
"Principal Financial Center" means, as applicable (i) the capital city of
the country issuing the Specified Currency; or (ii) the capital city of the
country to which the LIBOR Currency relates; provided, however, that with
respect to United States dollars, Australian dollars, Canadian dollars, Euros,
South African rands and Swiss francs, the "Principal Financial Center" shall be
The City of New York, Sydney, Toronto, London (solely in the case of the LIBOR
Currency), Johannesburg and Zurich, respectively.
"Proceeds" means all of the proceeds of, and all other profits, products,
rents, principal payments, interest payments or other receipts, in whatever
form, arising from the collection, sale, lease, exchange, assignment, licensing
or other disposition or maturity of, or other realization upon, a Funding
Agreement, including without limitation all claims of Global Funding against
third parties for loss of, damage to or destruction of, or for proceeds payable
under, such Funding Agreement, in each case whether now existing or hereafter
arising.
"Program" means the program for issuance, from time to time, of Secured
Medium Term Notes and Allstate Life(R) CoreNotes(R) through Allstate Life Global
Funding Trusts, as described in the Registration Statement.
"Program Funding Notes" means all funding notes issued, from time to time,
by Global Funding in connection with the Program.
"Redemption Date" means, with respect to the Funding Note to be redeemed,
pursuant to Section 3.1(b) or Section 3.1(c), the date of redemption of the
Funding Note, or such portion thereof, specified in the relevant notice of
redemption provided to the Funding Note Indenture Trustee pursuant to Section
3.1(d).
"Redemption Price" means an amount equal to the Initial Redemption
Percentage specified in the Funding Note Certificate (as adjusted by the Annual
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Redemption Percentage Reduction, if applicable) multiplied by the unpaid
principal amount of the Funding Note to be redeemed.
"Registration Statement" means the Registration Statement relating to the
Program (File No. 333-129157), filed with the Commission by the Funding
Agreement Provider and Global Funding on October 20, 2005, as amended by
Amendment No. 1 filed with the Commission on November 29, 2005, and Amendment
No. 2 filed with the Commission on -, 2006, and as it may further be amended,
supplemented, modified, restated or replaced from time to time.
"Regular Interest Record Date" has the meaning ascirbed in Section 2.8(a).
"Regulation AB" has the meaning ascribed in Section 7.5.
"Repayment Date" means, with respect to a Funding Note or any portion
thereof to be repaid pursuant to Section 3.2, the date for the repayment of such
Funding Note or such portion thereof as determined by, or pursuant to, the
Funding Note Indenture or the Funding Note Certificate or Supplemental Funding
Note Indenture.
"Repayment Price" means, with respect to the Funding Note or any portion
thereof to be repaid pursuant to Section 3.2, the price for repayment of such
Funding Note or such portion thereof as determined by, or pursuant to, the
Funding Note Indenture or the Funding Note Certificate or Supplemental Funding
Note Indenture.
"Responsible Officer" when used with respect to any Person means the
chairman of the board of directors or any vice chairman of the board of
directors or the president or any vice president (whether or not designated by a
number or numbers or a word or words added before or after the title "vice
president") of such Person. With respect to Global Funding, Responsible Officer
means any Responsible Officer (as defined in the preceding sentence) plus any
assistant secretary and any financial services officer of the Delaware Trustee,
and with respect to the Delaware Trustee or the Funding Note Indenture Trustee,
Responsible Officer means any Responsible Officer (as defined in the first
sentence of this definition) plus the chairman of the trust committee, the
chairman of the executive committee, any vice chairman of the executive
committee, the cashier, the secretary, the treasurer, any trust officer, any
assistant trust officer, any assistant vice president, any assistant cashier,
any assistant secretary, any assistant treasurer, or any other authorized
officer of the Delaware Trustee or Funding Note Indenture Trustee customarily
performing functions similar to those performed by the Persons who at the time
shall be such officers, respectively, or to whom any corporate trust matter is
referred because of his knowledge of and familiarity with the particular
subject.
"Securities Act" means the Securities Act of 1933, as amended, and any
successor statute thereto, and the rules, regulations and published
interpretations of the Commission promulgated thereunder from time to time.
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"Security Interest" has the meaning ascribed in Section 14.1(a).
"Series Instrument" means the series instrument of the Trust, pursuant to
which the Administrative Services Agreement, the Coordination Agreement, the
Funding Note Indenture, the Indenture, the Name Licensing Agreement, the Support
Agreement, the Terms Agreement and the Trust Agreement are entered into, and
certain other documents are executed, in connection with the issuance of the
Notes by the Trust.
"Special Interest Record Date" has the meaning ascribed in Section 2.8(b).
"Specified Currency" has the meaning ascribed in Section 2.4.
"Standard Trust Terms" means those Standard Trust Terms, dated as of -,
2006, which will be incorporated by reference in the Trust Agreement.
"Stated Maturity Date," means with respect to the Funding Note, any
installment of principal thereof, or interest thereon, any premium thereon or
any Additional Amounts with respect thereto, the date established by or pursuant
to the Funding Note Indenture or Funding Note Certificate or Supplemental
Funding Note Indenture as the date on which the principal of such Funding Note
or such installment of principal or interest or such premium is, or such
Additional Amounts are, due and payable.
"Supplemental Funding Note Indenture" has the meaning ascribed in Section
9.1(a).
"Support Agreement" means that certain Support and Expenses Agreement
included in Part C of the Series Instrument, by and between the Funding
Agreement Provider and the Trust, as the same may be amended, supplemented,
modified, restated or replaced from time to time.
"TARGET System" means the Trans-European Automated Real Time Gross
Settlement Express Transfer (TARGET) System.
"Tax Event" has the meaning ascribed in Section 3.1(c).
"Terms Agreement" means that certain Terms Agreement included in Part E of
the Series Instrument, by and among Global Funding, the Trust and each Agent
named therein, which will incorporate by reference the terms of the Distribution
Agreement.
"Trust" means the Allstate Life Global Funding Trust specified in the
Series Instrument, together with its permitted successors and assigns.
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"Trust Agreement" means that certain Trust Agreement included in Part A of
the Series Instrument, among the Delaware Trustee, the Administrator and the
Trust Beneficial Owner.
"Trust Beneficial Owner" means Global Funding, in its capacity as the sole
beneficial owner of the Trust, and its successors.
"Trust Certificate" means a certificate signed by the Global Funding
Administrator on behalf of Global Funding and delivered to the Funding Note
Indenture Trustee. Each such certificate shall include the statements provided
for in Section 13.5.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended,
and any successor statute thereto, and the rules, regulations and published
interpretations of the Commission promulgated thereunder from time to time.
"UCC" means the Uniform Commercial Code, as from time to time in effect in
the State of New York; provided that, with respect to the perfection, effect of
perfection or non-perfection, or priority of any security interest in the
Collateral, "UCC" shall mean the applicable jurisdiction whose law governs such
perfection, non-perfection or priority.
"United States", except as otherwise provided in or pursuant to the Funding
Note Indenture or the Funding Note Certificate, means the United States of
America (including the states thereof and the District of Columbia), its
territories and possessions and other areas subject to its jurisdiction.
"United States Dollars", "U.S. Dollars" or "$" means lawful currency of the
United States.
SECTION 1.2 Interpretation. For all purposes of the Funding Note Indenture
except as otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article shall have the meanings
ascribed to them in this Article and shall include the plural as
well as the singular;
(b) all accounting terms used and not expressly defined shall have
the meanings given to them in accordance with United States
generally accepted accounting principles, and the term "generally
accepted accounting principles" shall mean such accounting
principles which are generally accepted at the date or time of
any computation or at the date of the Funding Note Indenture;
(c) references to Exhibits, Articles, Sections, paragraphs,
subparagraphs and clauses shall be construed as references to the
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Exhibits, Articles, Sections, paragraphs, subparagraphs and
clauses of the Funding Note Indenture;
(d) the words "include", "includes" and "including" shall be
construed to be followed by the words "without limitation"; and
(e) Article and Section headings are for the convenience of the
reader and shall not be considered in interpreting the Funding
Note Indenture or the intent of the parties.
ARTICLE 2
THE FUNDING NOTE
SECTION 2.1 Amount Unlimited. The principal amount of the Funding Note that
may be authenticated and delivered under the Funding Note Indenture shall be the
principal amount of the Funding Note set forth in the Pricing Supplement.
SECTION 2.2 Status of Funding Note. The Funding Note constitutes a direct,
unconditional, unsubordinated and secured non-recourse obligation of Global
Funding.
SECTION 2.3 Forms Generally.
(a) The Funding Note Certificate, shall be in, or substantially in,
the form set forth in Exhibit A-1 or Exhibit A-2, as applicable,
with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by the Funding Note
Indenture or as may in Global Funding's judgment be necessary,
appropriate or convenient to permit the Funding Note to be issued
and sold, or to comply, or facilitate compliance, with applicable
laws, and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as
may be required to comply with the rules of any securities
exchange on which the Funding Note may be listed, or as may,
consistently herewith, be determined by the Responsible Officer
of Global Funding executing such Funding Note Certificate, with
the approval of the Funding Note Indenture Trustee, as evidenced
by his or her execution thereof.
(b) The Funding Note Certificate may be printed, lithographed,
engraved, typewritten, photocopied or otherwise produced in any
manner as the Responsible Officer of Global Funding executing
such Funding Note Certificate may determine.
(c) The terms and provisions contained in the Funding Note
Certificate and in any Supplemental Funding Note Indenture shall
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constitute, and are expressly made, a part of the Funding Note
Indenture and, to the extent applicable, Global Funding and the
Funding Note Indenture Trustee, by their execution and delivery
of the Funding Note Indenture, expressly agree to such terms and
provisions and to be bound thereby.
SECTION 2.4 Currency; Denominations.
(a) Unless otherwise specified in the Funding Note Certificate or in
any Supplemental Funding Note Indenture, the Funding Note will be
denominated in, and payments of principal of, premium and
interest on, and Additional Amounts in respect to, the Funding
Note will be made in, U.S. dollars. The currency in which the
Funding Note is denominated (or, if such currency is no longer
legal tender for the payment of public and private debts in the
country issuing such currency or, in the case of Euro, in the
member states of the European Union that have adopted the single
currency in accordance with the Treaty establishing the European
Community, as amended by the Treaty on European Union, such
currency which is then such legal tender) is in the Funding Note
Indenture referred to as the "Specified Currency".
(b) Unless otherwise provided in or pursuant to the Funding Note
Indenture, Global Funding appoints the Funding Note Indenture
Trustee as Funding Note Exchange Rate Agent with respect to the
Funding Note and the Funding Note Indenture Trustee accepts such
appointment.
(c) Unless otherwise specified in a Funding Note Certificate or in a
Supplemental Funding Note Indenture, the Funding Note shall be
issued in a minimum denomination of $1,000 and integral multiples
of $1,000 in excess thereof or equivalent denominations in other
currencies.
(d) Global Funding may (if so specified in a Funding Note Certificate
or Supplemental Funding Note Indenture) without the consent of
the Holder of the Funding Note, redenominate the Funding Note on
or after the date on which the member state of the European Union
in whose national currency the Funding Note is denominated has
become a participant member in the third stage of the European
economic and monetary union as more fully set out in the Funding
Note Certificate or Supplemental Funding Note Indenture.
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(e) Unless otherwise specified in the Funding Note Certificate or
Supplemental Funding Note Indenture, if the Specified Currency of
the Funding Note is other than U.S. Dollars, Global Funding shall
not sell a Funding Note in, or to residents of, the country
issuing such Specified Currency.
SECTION 2.5 Execution, Authentication, Delivery and Date.
(a) The Funding Note Certificate shall be executed on behalf of
Global Funding by any Responsible Officer of the Delaware
Trustee. The signature of any Responsible Officer of the Delaware
Trustee may be manual, in facsimile form, imprinted or otherwise
reproduced and may, but need not, be attested.
(b) The Funding Note Certificate bearing the signature of a Person
who was at any time a Responsible Officer of the Delaware Trustee
shall bind Global Funding, notwithstanding that such Person has
ceased to hold such office prior to the authentication and
delivery of such Funding Note Certificate or did not hold such
office at the date of such Funding Note Certificate.
(c) At any time, and from time to time, after the execution and
delivery of the Funding Note Indenture, Global Funding may
deliver the Funding Note Certificate executed by or on behalf of
Global Funding to the Funding Note Indenture Trustee for
authentication, and the Funding Note Indenture Trustee shall
thereupon authenticate and deliver such Funding Note Certificate
as provided in the Funding Note Indenture and not otherwise.
(d) The Funding Note Indenture Trustee shall have the right to
decline to authenticate and deliver the Funding Note Certificate
under this Section if the Funding Note Indenture Trustee has
obtained an Opinion of Counsel reasonably acceptable to Global
Funding, to the effect that the issuance of the Funding Note will
adversely affect the Funding Note Indenture Trustee's own rights,
duties or immunities under the Funding Note Indenture.
(e) The Funding Note Certificate shall be dated the date of its
authentication.
(f) The Funding Note shall not be entitled to any benefit under the
Funding Note Indenture or be valid or obligatory for any purpose,
unless there appears on the Funding Note Certificate representing
the Funding Note a certificate of authentication substantially in
the form attached as Exhibit B executed by the Funding Note
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Indenture Trustee by manual signature of one of its authorized
signatories. Such certificate upon the Funding Note Certificate
shall be conclusive evidence, and the only evidence, that such
Funding Note Certificate has been duly authenticated and
delivered under the Funding Note Indenture.
SECTION 2.6 Registration, Transfer and Exchange.
(a) The Funding Note Indenture Trustee will serve initially as
registrar (in such capacity, and together with any successor
registrar, the "Funding Note Registrar") for the Funding Note. In
such capacity, the Funding Note Indenture Trustee will cause to
be kept at the Corporate Trust Office of the Funding Note
Indenture Trustee a register (the "Funding Note Register") in
which, subject to such reasonable regulations as it may
prescribe, the Funding Note Indenture Trustee will provide for
the registration of the Funding Note and of transfers of the
Funding Note. The Funding Note Register shall be in written form
in the English language or in any other form capable of being
converted into such form within a reasonable time.
(b) Upon surrender of the Funding Note Certificate for registration
of transfer of the Funding Note represented thereby, together
with the form of transfer endorsed thereon duly completed and
executed, at the designated office of the Funding Note Registrar
or of any applicable transfer agent, each as provided in the
Funding Note Certificate or Supplemental Funding Note Indenture,
the Delaware Trustee, on behalf of Global Funding shall execute,
and the Funding Note Indenture Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees,
a new Funding Note Certificate representing the Funding Note.
(c) The Funding Note Certificate executed, authenticated and
delivered upon any transfer or exchange shall be a valid
obligation of Global Funding, evidencing the same debt, and
entitled to the same benefits under the Funding Note Indenture,
as the Funding Note Certificate surrendered in connection with
any such transfer or exchange. Upon surrender or transfer of the
Funding Note Certificate pursuant to this Section 2.6, each new
Funding Note Certificate will, within three Business Days of the
receipt of the applicable form of transfer or the applicable
surrender, as the case may be, be delivered to the designated
office of the Funding Note Registrar or of any applicable
transfer agent, each as provided in the Funding Note Certificate
or
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Supplemental Funding Note Indenture, or mailed at the risk of the
Person entitled to such Funding Note Certificate to such address
as may be specified in the form of transfer.
(d) The Funding Note Certificate presented or surrendered in
connection with a transfer shall (if so required by Global
Funding or the Funding Note Indenture Trustee) be duly endorsed,
or be accompanied by a written instrument of transfer in form
satisfactory to Global Funding and the Funding Note Indenture
Trustee duly executed by, the applicable Holder or his attorney
duly authorized in writing.
(e) No service charge shall be made in connection with any transfer
of the Funding Note or the Funding Note Certificate, but Global
Funding or the Funding Note Indenture Trustee may require payment
of a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection with a transfer of the Funding
Note or exchange of the Funding Note Certificate.
(f) Except as otherwise provided in or pursuant to the Funding Note
Indenture, Global Funding and the Funding Note Indenture Trustee
shall not be required to (i) upon presentation or surrender of
the Funding Note Certificate in connection with any transfer
during a period beginning at the opening of business 15 days
before the day of the selection for redemption of the Funding
Note or any portion thereof under Section 3.1 and ending at the
close of business on the day of such selection, register the
transfer of the Funding Note, or portion thereof, except if the
Funding Note is to be redeemed in part, with respect to the
portion of the Funding Note not to be redeemed, or (ii) exchange
the Funding Note Certificate representing the Funding Note the
Holder or Holders of which Funding Note shall have exercised the
option pursuant to Section 3.2 to require Global Funding to repay
the Funding Note prior to its Stated Maturity Date or register
the transfer of the Funding Note except, if the Funding Note is
to be repaid in part, with respect to the portion of the Funding
Note not to be repaid.
(g) No exchanges of the Funding Note shall be permitted other than
exchanges of the Funding Note pursuant to Sections 2.7, 3.1, 3.2
or 9.5.
SECTION 2.7 Mutilated, Destroyed, Lost or Stolen Funding Note Certificates.
16
(a) If (i) the Funding Note Certificate is mutilated and is
surrendered to the Funding Note Indenture Trustee or Global
Funding, or the Funding Note Indenture Trustee and Global Funding
receive evidence to their satisfaction of the destruction, loss
or theft of the Funding Note Certificate, and (ii) there is
delivered to Global Funding and the Funding Note Indenture
Trustee such security or indemnity as may be required by them to
save each of them harmless, then, in the absence of notice to
Global Funding or the Funding Note Indenture Trustee that the
Funding Note Certificate has been acquired by a protected
purchaser, Global Funding shall execute and upon its request the
Funding Note Indenture Trustee shall authenticate and deliver, in
exchange for or in lieu of the mutilated, destroyed, lost or
stolen Funding Note Certificate, a new Funding Note Certificate
representing the Funding Note.
(b) If the Funding Note has become or is about to become due and
payable, Global Funding in its discretion may, instead of issuing
a new Funding Note Certificate, pay such amounts in respect of
the Funding Note.
(c) Upon the execution, authentication and delivery of the new
Funding Note Certificate under this Section, the Funding Note
Indenture Trustee or Global Funding may require the Holder to pay
a sum sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto and any other expenses
(including the fees and expenses of the Funding Note Indenture
Trustee) connected therewith.
(d) The Funding Note represented by the Funding Note Certificate
executed, authenticated and delivered pursuant to this Section in
lieu of the apparently destroyed, lost or stolen Funding Note
Certificate shall constitute an original additional contractual
obligation of Global Funding, whether or not any obligation with
respect to the Funding Note represented by the apparently
destroyed, lost or stolen Funding Note Certificate shall be at
any time enforceable by any Person, and shall be entitled to all
of the benefits of the Funding Note Indenture equally and
proportionately with the Funding Note duly issued under the
Funding Note Indenture.
(e) The provisions of this Section are exclusive with respect to the
replacement of the mutilated or apparently destroyed, lost or
stolen Funding Note Certificate or the payment of the Funding
Note represented thereby and shall preclude all other rights and
remedies with respect to the replacement of the mutilated or
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apparently destroyed, lost or stolen Funding Note Certificate or
the payment of the Funding Note represented thereby.
SECTION 2.8 Interest Record Dates.
(a) Interest on and Additional Amounts with respect to the Funding
Note which is payable, on any interest payment date specified in
the Funding Note Certificate or in any Supplemental Funding Note
Indenture (each such date, an "Interest Payment Date") shall be
paid to the Holder of the Funding Note at the close of business
on the date specified as the regular interest record date in the
Funding Note Certificate or Supplemental Funding Note Indenture
(the "Regular Interest Record Date") or, if no such date is
specified, the date that is 15 calendar days preceding such
Interest Payment Date.
(b) Unless otherwise provided in the Funding Note Certificate or in
any Supplemental Funding Note Indenture, any interest on, and any
Additional Amounts with respect to, the Funding Note which is
payable, but is not punctually paid or duly provided for, on any
Interest Payment Date specified in the Funding Note Certificate
or Supplemental Funding Note Indenture (the "Defaulted Interest")
shall forthwith cease to be payable to the Holder of the Funding
Note on the relevant Regular Interest Record Date by virtue of
having been such Holder, and such Defaulted Interest shall be
paid by Global Funding to the Holder of the Funding Note at the
close of business on a special record date (the "Special Interest
Record Date") established by Global Funding by notice to each
applicable Holder and the Funding Note Indenture Trustee in
accordance with Section 13.4, which Special Interest Record Date
shall be not more than 15 nor less than 10 days prior to the date
of the proposed payment of Defaulted Interest and not less than
10 days after the receipt by the Funding Note Indenture Trustee
of the notice of the proposed payment of Defaulted Interest.
SECTION 2.9 Cancellation.
(a) The Funding Note shall be cancelled immediately upon the transfer
by Global Funding to, or as directed by, the Trust of each
Funding Agreement, and such cancellation shall operate as a
redemption and satisfaction of the Funding Note.
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(b) In case the Funding Note Certificate shall be surrendered for
exchange or in connection with any payment, redemption or
transfer of the Funding Note represented thereby, the Funding
Note Certificate shall be delivered to the Funding Note Indenture
Trustee and, if not already cancelled, shall be promptly
cancelled by it. Global Funding may at any time deliver to the
Funding Note Indenture Trustee for cancellation the Funding Note
Certificate previously authenticated and delivered under the
Funding Note Indenture which Global Funding may have acquired in
any manner whatsoever, and the Funding Note Certificate so
delivered shall be promptly cancelled by the Funding Note
Indenture Trustee. No Funding Note Certificates shall be
authenticated in lieu of or in exchange for the Funding Note
Certificate cancelled as provided in this Section, except as
expressly permitted by the Funding Note Indenture. The Funding
Note Indenture Trustee shall destroy the cancelled Funding Note
Certificate held by it and deliver a certificate of destruction
to Global Funding. If Global Funding shall acquire the Funding
Note, such acquisition shall not operate as a redemption or
satisfaction of the indebtedness represented by the Funding Note
unless and until the Funding Note Certificate representing the
Funding Note is delivered to the Funding Note Indenture Trustee
for cancellation.
SECTION 2.10 Withholding Tax. All amounts due in respect of the Funding
Note will be made without withholding or deduction for or on account of any
present or future taxes, duties, levies, assessments or other governmental
charges of whatever nature imposed or levied by or on behalf of any governmental
authority in the United States having the power to tax payments on the Funding
Note unless the withholding or deduction is required by law. Unless otherwise
specified in the Funding Note Certificate, Global Funding will not pay any
Additional Amounts to the Holders of the Funding Note in the event that any
withholding or deduction is so required by law, regulation or official
interpretation thereof, and the imposition of a requirement to make any such
withholding or deduction will not give rise to any independent right or
obligation to redeem or repay the Funding Note and shall not constitute an Event
of Default.
SECTION 2.11 Tax Treatment. The parties agree, and each Holder and
beneficial owner of the Funding Note by purchasing the Funding Note agrees, for
all United States Federal, state and local income and franchise tax purposes (i)
to treat the Funding Note as indebtedness of the Funding Agreement Provider,
(ii) Global Funding and each Trust will be ignored and will not be treated as an
association or a publicly traded partnership taxable as a corporation and (iii)
to not take any action inconsistent with the treatment described in (i) and (ii)
unless otherwise required by law.
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ARTICLE 3
REDEMPTION, REPAYMENT AND REPURCHASE OF FUNDING NOTE; SINKING FUNDS
SECTION 3.1 Redemption of Funding Note.
(a) Redemption of the Funding Note by Global Funding as permitted or
required by the Funding Note Indenture and the Funding Note
Certificate will be made in accordance with the terms of the
Funding Note and (except as otherwise provided in the Funding
Note Indenture or pursuant to the Funding Note Indenture) this
Section.
(b) If any Initial Redemption Date is specified in the Funding Note
Certificate, Global Funding may redeem the Funding Note prior to
the Stated Maturity Date at its option, on, or on any Business
Day after, the Initial Redemption Date in whole or from time to
time in part in increments of $1,000 or any other integral
multiple of an authorized denomination of the Funding Note at the
applicable Redemption Price together with any unpaid interest
accrued thereon, any Additional Amounts and other amounts payable
with respect thereto, as of the Redemption Date.
(c) If (i) Global Funding is required at any time to pay Additional
Amounts or if Global Funding is obligated to withhold or deduct
any United States taxes with respect to any payment under the
Funding Note, as set forth in the Funding Note Certificate, or if
there is a material probability that Global Funding will become
obligated to withhold or deduct any such United States taxes or
otherwise pay Additional Amounts (in the opinion of independent
legal counsel selected by the Funding Agreement Provider), in
each case pursuant to any change in or amendment to any United
States tax laws (or any regulations or rulings thereunder) or any
change in position of the Internal Revenue Service regarding the
application or interpretation thereof (including, but not limited
to, the Funding Agreement Provider's or Global Funding's receipt
of a written adjustment from the Internal Revenue Service in
connection with an audit) (a "Tax Event"), and (ii) the Funding
Agreement Provider, pursuant to the terms of the relevant Funding
Agreement, has delivered to the Owner notice that the Funding
Agreement Provider intends to terminate the relevant Funding
Agreement pursuant to the terms of such Funding Agreement, then
Global Funding will redeem the Funding Note on the Redemption
Date at the Redemption Price together with any unpaid interest
accrued thereon, any Additional Amounts and
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other amounts payable with respect thereto, as of the Redemption
Date.
(d) Unless a shorter notice shall be satisfactory to the Funding Note
Indenture Trustee, Global Funding shall provide to the Funding
Note Indenture Trustee a notice of redemption of the Funding Note
(i) in case of any redemption at the election of Global Funding,
not more than 60 days nor less than 35 days prior to the
Redemption Date and (ii) in case of any mandatory redemption
pursuant to Section 3.1(c), at least 75 days prior to the
Redemption Date.
(e) Unless otherwise specified in the Funding Note Indenture or the
Funding Note Certificate, Global Funding shall give a notice of
redemption to the Holder of the Funding Note or any portion
thereof to be redeemed at Global Funding's option (i) in case of
any redemption at the election of Global Funding, not more than
60 days nor less than 30 days prior to the Redemption Date and
(ii) in case of any mandatory redemption pursuant to Section
3.1(c), not more than 75 days nor less than 30 days prior to the
Redemption Date; provided, that in the case of any notice of
redemption given pursuant to clause (ii) no such notice of
redemption may be given earlier than 90 days prior to the
earliest day on which Global Funding would become obligated to
pay the applicable Additional Amounts were a payment in respect
of the Funding Note then due. Failure to give such notice to the
Holder of any portion of the Funding Note designated for
redemption, or any defect in the notice to any such Holder, shall
not affect the validity of the proceedings for the redemption of
any other portion of the Funding Note.
Any notice that is mailed to the Holder of the Funding Note in the manner
provided for in Section 13.4 shall be conclusively presumed to have been duly
given, whether or not such Holder receives the notice.
All notices of redemption shall state:
(i) the Redemption Date,
(ii) the Redemption Price or, if not then ascertainable, the
manner of calculation thereof,
(iii) the principal amount of the Funding Note to be redeemed,
21
(iv) in case the Funding Note is to be redeemed in part only at
the election of Global Funding, the notice shall state that
on and after the Redemption Date, upon surrender of the
Funding Note Certificate representing the Funding Note, a
new Funding Note Certificate representing an authorized
denomination of the principal amount of the Funding Note
remaining unredeemed will be delivered by Global Funding,
(v) that, on the Redemption Date, the Redemption Price shall
become due and payable upon the Funding Note or portion
thereof to be redeemed, and, if applicable, that interest
thereon shall cease to accrue on and after the Redemption
Date,
(vi) the place or places where the Funding Note Certificate
representing the Funding Note is to be surrendered for
payment of the Redemption Price together with any unpaid
interest accrued thereon through the Redemption Date and any
Additional Amounts payable with respect thereto,
(vii) if applicable, in case of any redemption at the election of
Global Funding, that the redemption is for a sinking fund,
and
(viii) the CUSIP number or any other numbers used to identify the
Funding Note.
(f) On or prior to any Redemption Date, Global Funding shall deposit,
with respect to the Funding Note or any portion thereof called
for redemption pursuant to this Section, with the Funding Note
Paying Agent an amount of money in the Specified Currency
sufficient to pay the Redemption Price of, and (except if the
Redemption Date shall be an Interest Payment Date, unless
otherwise specified in the Funding Note Certificate) any unpaid
interest accrued through the Redemption Date on, and any
Additional Amounts payable with respect to, the Funding Note or
such portion thereof which is to be redeemed on the Redemption
Date.
(g) On the Redemption Date, the Funding Note or any portion thereof
to be redeemed shall, become due and payable at the Redemption
Price together with any unpaid interest accrued through the
Redemption Date on, and any Additional Amounts
22
payable with respect to, the Funding Note or such portion
thereof, and from and after such date (unless Global Funding
shall default in the payment of the Redemption Price and any
unpaid interest accrued on the Funding Note or such portion
thereof through the Redemption Date) the Funding Note or such
portion thereof shall cease to bear interest. Upon surrender of
the Funding Note Certificate for redemption of the Funding Note
or any portion thereof represented thereby in accordance with the
applicable notice of redemption, the Funding Note or such portion
thereof shall be paid by Global Funding at the Redemption Price,
together with any unpaid interest accrued thereon through the
Redemption Date and any Additional Amounts payable with respect
thereto.
(h) If the Funding Note or any portion thereof called for redemption
shall not be so paid upon surrender of the Funding Note
Certificate for redemption, the principal and any premium, until
paid, shall bear interest from the Redemption Date at the rate
specified in the Funding Note Certificate.
(i) Notwithstanding anything herein to contrary, Global Funding may
redeem the Funding Note on the Original Issue Date without notice
at a price equal to the principal amount of the Funding Note (the
"Immediate Redemption Price"). Global Funding may pay the
Redemption Price or the Immediate Redemption Price in cash or
Funding Agreement(s).
Upon surrender of the Funding Note Certificate for partial redemption of
the Funding Note in accordance with this Section, Global Funding shall execute
and the Funding Note Indenture Trustee shall authenticate and deliver one or
more new Funding Note Certificates of any authorized denomination representing
an aggregate principal amount equal to the unredeemed portion of the Funding
Note.
SECTION 3.2 Repayment at the Option of the Holder.
(a) If so specified in the Funding Note Certificate, the Holder or
Holders of the Funding Note may require Global Funding to repay
the Funding Note prior to the Stated Maturity Date in whole or
from time to time in part in increments of $1,000 or any other
integral multiple of an authorized denomination specified in the
Funding Note Certificate (provided that any remaining principal
amount thereof shall be at least $1,000 or other minimum
authorized denomination applicable thereto).
23
(b) If the Funding Note is repayable at the option of the Holder or
Holders thereof before the Stated Maturity Date, the Funding Note
shall be repaid in accordance with its terms.
(c) The repayment of any principal amount of the Funding Note
pursuant to any option of the Holder or Holders to require
repayment of the Funding Note before the Stated Maturity Date
shall not operate as a payment, redemption or satisfaction of the
indebtedness represented by the Funding Note unless and until
Global Funding, at its option, shall deliver or surrender the
Funding Note Certificate representing the Funding Note to the
Funding Note Indenture Trustee with a directive that the Funding
Note Certificate be cancelled.
(d) Notwithstanding anything to the contrary contained in this
Section, in connection with any repayment of the Funding Note,
Global Funding may arrange for the purchase of the Funding Note
by an agreement with one or more investment bankers or other
purchasers to purchase the Funding Note by paying the Holder or
Holders of the Funding Note on or before the close of business on
the Repayment Date an amount not less than the Repayment Price
payable by Global Funding on repayment of the Funding Note, and
the obligation of Global Funding to pay the Repayment Price of
the Funding Note shall be satisfied and discharged to the extent
such payment is so paid by such purchasers.
(e) Any exercise of the repayment option will be irrevocable.
Upon surrender of the Funding Note Certificate for partial repayment of the
Funding Note in accordance with this Section, Global Funding shall execute and
the Funding Note Indenture Trustee shall authenticate and deliver one or more
new Funding Note Certificates of any authorized denomination representing an
aggregate principal amount equal to the outstanding portion of the Funding Note.
SECTION 3.3 Repurchase of Funding Note.
(a) Global Funding may purchase the Funding Note or any portion
thereof in the open market or otherwise at any time, and from
time to time, with the prior written consent of the Funding
Agreement Provider as to both the making of such purchase and the
purchase price to be paid for such Funding Note or such portion
thereof.
24
(b) If the Funding Agreement Provider, in its sole discretion,
consents to such purchase of the Funding Note or any portion
thereof by Global Funding, the parties to the Funding Note
Indenture agree to take such actions as may be necessary or
desirable to effect the prepayment of such portion, or the
entirety, of the current Principal Amount, under each applicable
Funding Agreement as may be necessary to provide for the payment
of the purchase price for the Funding Note or such portion
thereof. Upon such payment, the Principal Amount under each
Funding Agreement shall be reduced (i) if the Funding Note bears
interest at fixed or floating rates, by an amount equal to the
principal amount of the Funding Note or such portion thereof so
purchased (or the portion thereof applicable to such Funding
Agreement) and (ii) if the Funding Note does not bear interest at
fixed or floating rates, by an amount to be agreed between Global
Funding and the Funding Agreement Provider to reflect such
prepayment under the Funding Agreement(s).
(c) The parties acknowledge and agree that (i) notwithstanding
anything to the contrary in the Funding Note Indenture, any
repurchase of the Funding Note or any portion thereof in
compliance with this Section 3.3 shall not violate any provision
of the Funding Note Indenture or the Amended and Restated Trust
Agreement and (ii) no Opinion of Counsel, Trust Certificate or
any other document or instrument shall be required to be provided
in connection with any repurchase of the Funding Note or any
portion thereof pursuant to this Section 3.3.
(d) If applicable, Global Funding will comply with the requirements
of Section 14(e) of the Exchange Act, and the rules promulgated
thereunder, and any other applicable securities laws or
regulations in connection with any repurchase pursuant to this
Section 3.3.
SECTION 3.4 Sinking Funds. Unless otherwise provided in the Funding Note
Certificate, the Funding Note will not be subject to, or entitled to the benefit
of, any sinking fund.
25
ARTICLE 4
PAYMENTS; FUNDING NOTE PAYING AGENTS AND FUNDING NOTE CALCULATION AGENT;
COVENANTS
SECTION 4.1 Payment of Principal and Interest.
(a) Global Funding will duly and punctually pay or cause to be paid
the principal of, any premium and interest on, and any Additional
Amounts with respect to, the Funding Note, in accordance with the
terms of the Funding Note and the Funding Note Indenture.
(b) Unless otherwise specified in the Funding Note Certificate, upon
the receipt of the funds necessary therefor, the applicable
Funding Note Paying Agent shall duly and punctually make
payments, payable on the Maturity Date, of principal in respect
of, any premium and interest on, and any Additional Amounts
payable with respect to, the Funding Note in immediately
available funds against presentation and surrender of the Funding
Note Certificate (and in the case of any repayment of the Funding
Note or any portion thereof pursuant to Section 3.2, upon
submission of a duly completed election form at an office or
agency of such Funding Note Paying Agent maintained for such
purpose pursuant to Section 4.3). The applicable Funding Note
Paying Agent (unless such Funding Note Paying Agent is the
Funding Note Indenture Trustee) shall promptly forward the
Funding Note Certificate surrendered to it in connection with any
payment pursuant to this Section for cancellation in accordance
with Section 2.9. Unless otherwise specified in the Funding Note
Certificate, upon the receipt of the funds necessary therefor,
the applicable Funding Note Paying Agent shall duly and
punctually make payments of principal of, any premium and
interest on, and any Additional Amounts in respect of, the
Funding Note payable on any date other than the Maturity Date by
check mailed to the Holder (or to the first named of joint
Holders) of the Funding Note at the close of business on the
Regular Interest Record Date or Special Interest Record Date, as
the case may be, at its address appearing in the Funding Note
Register. Notwithstanding the foregoing, the applicable Funding
Note Paying Agent shall make payments of principal, any interest,
any premium, and any Additional Amounts on any date other than
the Maturity Date to each Holder entitled thereto (or to the
first named of joint Holders) at the close of business on the
applicable Regular Interest Record Date or Special Interest
Record Date, as the case may be, of $10,000,000 (or, if the
Specified Currency is other than United States dollars, the
equivalent thereof in the particular
26
Specified Currency) or more in principal amount of the Funding
Note by wire transfer of immediately available funds if the
applicable Holder has delivered appropriate wire transfer
instructions in writing to the applicable Funding Note Paying
Agent not less than 15 days prior to the date on which the
applicable payment of principal, interest, premium or Additional
Amounts is scheduled to be made. Any wire transfer instructions
received by the applicable Funding Note Paying Agent shall remain
in effect until revoked by the applicable Holder.
(c) Unless otherwise specified in the Funding Note Certificate, if
the Specified Currency of the Funding Note is other than U.S.
Dollars, Global Funding shall be obligated to make, or cause to
be made, payments of principal of, any premium and interest on,
and any Additional Amounts with respect to, the Funding Note in
such Specified Currency. Any amounts so payable by Global Funding
in such Specified Currency will be converted by the Funding Note
Exchange Rate Agent into United States dollars for payment to the
Holder or Holders thereof unless otherwise specified in the
Funding Note Certificate or a Holder elects to receive such
amounts in such Specified Currency as provided below.
(d) Unless otherwise specified in the Funding Note Certificate, if
the Specified Currency of the Funding Note is other than U.S.
dollars, any United States dollar amount to be received by the
Holder or Holders of the Funding Note will be based on the
highest bid quotation in The City of New York received by the
Funding Note Exchange Rate Agent at approximately 11:00 a.m. (New
York City time) on the second Business Day preceding the
applicable payment date from three recognized foreign exchange
dealers (one of whom may be the Funding Note Exchange Rate Agent)
selected by the Funding Note Exchange Rate Agent and approved by
Global Funding for the purchase by the quoting dealer of the
Specified Currency for United States dollars for settlement on
that payment date in the aggregate amount of such Specified
Currency payable to the Holder or Holders of the Funding Note
scheduled to receive United States dollar payments and at which
the applicable dealer commits to execute a contract. All currency
exchange costs will be borne by the relevant Holder or Holders of
the Funding Note by deductions from any payments. If three bid
quotations are not available, payments will be made in the
Specified Currency.
27
(e) If the Specified Currency of the Funding Note is other than U.S.
Dollars, Holders of the Funding Note may elect to receive all or
a specified portion of any payment of principal and/or any
interest, premium and Additional Amounts in the Specified
Currency by submitting a written request therefor to the Funding
Note Indenture Trustee at its Corporate Trust Office in The City
of New York on or prior to the applicable Regular Interest Record
Date or Special Interest Record Date or at least 15 calendar days
prior to the Maturity Date, as the case may be. Such written
request may be mailed or hand delivered or sent by cable, telex
or other form of facsimile transmission. Such election will
remain in effect until revoked by written notice delivered to the
Funding Note Indenture Trustee on or prior to the applicable
Regular Interest Record Date or Special Interest Record Date or
at least 15 calendar days prior to the Maturity Date, as the case
may be.
(f) Notwithstanding anything to the contrary in this Funding Note
Indenture, if the Specified Currency for the Funding Note is
other than U.S. Dollars and the Specified Currency is not
available for any required payment of principal and/or any
interest, premium and Additional Amounts due to the imposition of
exchange controls or other circumstances beyond Global Funding's
control, Global Funding will be entitled to satisfy its
obligations with respect to the Funding Note by making, or
causing to be made, payments in United States dollars based on
the Market Exchange Rate, computed by the Funding Note Exchange
Rate Agent, on the second Business Day prior to the particular
payment date or, if the Market Exchange Rate is not then
available, on the basis of the most recently available Market
Exchange Rate.
(g) All determinations made by the Funding Note Exchange Rate Agent
shall be at its sole discretion and shall, in the absence of
manifest error, be conclusive for all purposes and binding on the
Holder or Holders of the Funding Note.
SECTION 4.2 Collection Account. Global Funding shall, on or prior to the
Original Issue Date, establish a non-interest bearing account with the Funding
Note Indenture Trustee or such other depository institution that is rated at
least AA by Standard & Poor's Ratings Services, a division of the McGraw-Hill
Companies, Inc. or Aa2 by Moody's Investors Services, Inc., or has an equivalent
rating from another nationally recognized statistical rating organization as may
be designated by Global Funding (the "Collection Account"), into which account
shall be deposited payments received under the applicable Funding Agreement(s)
and which account shall be segregated from other accounts held by the Funding
Note Indenture Trustee or such other depositary institution.
28
SECTION 4.3 Offices for Payments, Etc.
(a) So long as the Funding Note remains outstanding, Global Funding
will maintain in New York and in any other city that may be
required by any stock exchange on which the Funding Note may be
listed, and in any city specified in the Funding Note Certificate
the following: (i) an office or agency where the Funding Note may
be presented for payment, (ii) an office or agency where the
Funding Note may be presented for registration of transfer and
for exchange as provided in the Funding Note Indenture and (iii)
an office or agency where notices and demands to or upon Global
Funding in respect of the Funding Note or of the Funding Note
Indenture may be served. Global Funding will give to the Funding
Note Indenture Trustee written notice of the location of any such
office or agency and of any change of location thereof. Global
Funding initially designates the Corporate Trust Office of the
Funding Note Indenture Trustee as the office or agency for each
such purpose. In case Global Funding shall fail to maintain any
such office or agency or shall fail to give such notice of the
location or of any change in the location thereof, presentations
and demands may be made and notices may be served at the
Corporate Trust Office.
(b) Global Funding hereby agrees to issue a standing order to the
Funding Note Indenture Trustee, pursuant to which the Funding
Note Indenture Trustee, directly or through any Funding Note
Paying Agent, shall distribute all amounts due and unpaid under
Section 3.1(b) of the Amended and Restated Trust Agreement. For
so long as (i) Global Funding has not rescinded the standing
order (notice of such rescission to be promptly given by Global
Funding to the Funding Note Indenture Trustee) and (ii) the
Funding Note Indenture Trustee, either directly or through any
Funding Note Paying Agent is able to, and does, comply with the
standing order, Global Funding will not be required to establish
a Payment Account (as defined in the Amended and Restated Trust
Agreement) in accordance with Section 3.1 of the Amended and
Restated Trust Agreement.
SECTION 4.4 Appointment to Fill a Vacancy in Office of Funding Note
Indenture Trustee. Global Funding, whenever necessary to avoid or fill a vacancy
in the office of the Funding Note Indenture Trustee, will appoint, in the manner
provided in Section 6.8, a trustee, so that there shall at all times be a
trustee under the Funding Note Indenture.
29
SECTION 4.5 Funding Note Paying Agents.
(a) Unless otherwise provided in or pursuant to the Funding Note
Indenture, Global Funding appoints the Funding Note Indenture Trustee
as Funding Note Paying Agent with respect to the Funding Note and the
Funding Note Indenture Trustee accepts such appointment. The Funding
Note Indenture Trustee, in its capacity as Funding Note Paying Agent,
agrees, and, whenever Global Funding shall appoint a Funding Note
Paying Agent other than the Funding Note Indenture Trustee with
respect to the Funding Note, Global Funding will cause such Funding
Note Paying Agent to execute and deliver to Global Funding and the
Funding Note Indenture Trustee an instrument in which such Funding
Note Paying Agent shall agree with Global Funding and the Funding Note
Indenture Trustee, subject to the provisions of this Section, that it
will:
(i) hold all sums received by it as such agent for the payment of the
principal of, any premium or interest on, or any Additional
Amounts with respect to, the Funding Note (whether such sums have
been paid to it by the Funding Agreement Provider, Global Funding
or by any other obligor on the Funding Note) in trust for the
benefit of each Holder of the Funding Note;
(ii) give the Funding Note Indenture Trustee notice of any failure by
Global Funding (or by any other obligor on the Funding Note) to
make any payment of the principal of, any premium and interest
on, or any Additional Amounts with respect to, the Funding Note
when the same shall be due and payable;
(iii) pay any such sums so held in trust by it to the Funding Note
Indenture Trustee upon the Funding Note Indenture Trustee's
written request at any time during the continuance of the failure
referred to in clause (ii) above;
(iv) in the absence of the failure referred in clause (ii) above, pay
any such sums so held in trust by it in accordance with the
Funding Note Indenture and the terms of the Funding Note; and
(v) comply with all agreements of Funding Note Paying Agents in, and
perform all functions and obligations imposed on Funding Note
Paying Agents by or pursuant
30
to, the Funding Note Indenture and the Funding Note Certificate
or Supplemental Funding Note Indenture.
(b) At or prior to 9:30 a.m. (New York City time) on each due date of the
principal of, any premium and interest on, or any Additional Amounts
with respect to, the Funding Note, Global Funding will deposit or
cause to be deposited with the applicable Funding Note Paying Agent a
sum sufficient to pay such principal, any interest or premium, and any
Additional Amounts, and (unless such Funding Note Paying Agent is the
Funding Note Indenture Trustee) Global Funding will promptly notify
the Funding Note Indenture Trustee of any failure to take such action.
(c) Anything in this Section to the contrary notwithstanding, Global
Funding may at any time, for purpose of obtaining satisfaction and
discharge of the Funding Note under the Funding Note Indenture, pay or
cause to be paid to the Funding Note Indenture Trustee all sums held
in trust by Global Funding or any Funding Note Paying Agent under the
Funding Note Indenture, as required by this Section, such sums to be
held by the Funding Note Indenture Trustee upon the terms contained in
the Funding Note Indenture.
(d) Anything in this Section to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section are
subject to the provisions of Sections 11.3 and 11.4.
(e) The applicable Funding Note Paying Agent shall (i) collect all forms
from Holders of the Funding Note (or from such other Persons as are
relevant) that are required to exempt payments under the Funding Note
and/or the related Funding Agreement(s) from United States Federal
income tax withholding, (ii) withhold and pay over to the Internal
Revenue Service or other taxing authority with respect to payments
under the Funding Note any amount of taxes required to be withheld by
any United States Federal, state or local statute, rule or regulation
and (iii) forward copies of such forms to Global Funding and the
Funding Agreement Provider.
(f) Each Funding Note Paying Agent shall forward to Global Funding at
least monthly a bank statement in its possession with respect to the
performance of its functions and obligations with respect to the
Funding Note.
31
(g) Global Funding shall pay the compensation of each Funding Note Paying
Agent at such rates as shall be agreed upon in writing by Global
Funding and the relevant Funding Note Paying Agent from time to time
and shall reimburse each Funding Note Paying Agent for reasonable
expenses properly incurred by such Funding Note Paying Agent in
connection with the performance of its duties upon receipt of such
invoices as Global Funding shall reasonably require.
(h) Subject as provided below, each Funding Note Paying Agent may at any
time resign as Funding Note Paying Agent by giving not less than 60
days' written notice to Global Funding and the Funding Note Indenture
Trustee (unless the Funding Note Indenture Trustee is such Funding
Note Paying Agent) of such intention on its part, specifying the date
on which its resignation shall become effective. Except as provided
below, Global Funding may remove a Funding Note Paying Agent by giving
not less than 20 days' written notice specifying such removal and the
date when it shall become effective. Any such resignation or removal
shall take effect upon:
(i) the appointment by Global Funding of a successor Funding Note
Paying Agent; and
(ii) the acceptance of such appointment by such successor Funding Note
Paying Agent,
provided that with respect to any Funding Note Paying Agent who timely
receives any amount with respect to the Funding Note and fails duly to
pay any such amounts when due and payable in accordance with the terms
of the Funding Note Indenture and the Funding Note, any such removal
will take effect immediately upon such appointment of, and acceptance
thereof by, a successor Funding Note Paying Agent approved by the
Funding Note Indenture Trustee (unless the Funding Note Indenture
Trustee is such Funding Note Paying Agent), in which event notice of
such appointment shall be given to each Holder of the Funding Note as
soon as practicable thereafter. Global Funding agrees with each
Funding Note Paying Agent that if, by the day falling 10 days before
the expiration of any notice given pursuant to this Section 4.5(h),
Global Funding has not appointed a replacement Funding Note Paying
Agent, then the Funding Note Paying Agent shall be entitled, on behalf
of Global Funding, to appoint in its place a reputable financial
institution of good standing reasonably acceptable to Global Funding
and the Funding Note
32
Indenture Trustee (unless the Funding Note Indenture Trustee is such
Funding Note Paying Agent); provided, however, that notwithstanding
the foregoing, the resignation or removal of the relevant Funding Note
Paying Agent shall not be effective unless, upon the expiration of the
notice given pursuant to this Section 4.5(h), the successor Funding
Note Paying Agent shall have accepted its appointment. Upon its
resignation or removal becoming effective, the retiring Funding Note
Paying Agent shall be entitled to the payment of its compensation and
reimbursement of all expenses incurred by such retiring Funding Note
Paying Agent pursuant to Section 4.4(g) up to the effective date of
such resignation or removal.
(i) If at any time a Funding Note Paying Agent shall resign or be removed,
or shall become incapable of acting with respect to the Funding Note,
or shall be adjudged as bankrupt or insolvent, or a receiver or
liquidator of such Funding Note Paying Agent or of its property shall
be appointed, or any public officer shall take charge or control of
such Funding Note Paying Agent or its property or affairs for the
purpose of rehabilitation, conservation or liquidation, then a
successor Funding Note Paying Agent shall be appointed by Global
Funding by an instrument in writing filed with the successor Funding
Note Paying Agent. Upon any such appointment of, and the acceptance of
such appointment by, a successor Funding Note Paying Agent and (except
in cases of removal for failure to timely pay any amounts as required
by or pursuant to the Funding Note Indenture or the Funding Note
Certificate or Supplemental Funding Note Indenture) the giving of
notice to each Holder of the Funding Note, the retiring Funding Note
Paying Agent shall cease to be Funding Note Paying Agent under the
Funding Note Indenture.
(j) Any successor Funding Note Paying Agent appointed under the Funding
Note Indenture shall execute and deliver to its predecessor, Global
Funding and the Funding Note Indenture Trustee (unless the Funding
Note Indenture Trustee is such Funding Note Paying Agent) a reasonably
acceptable instrument accepting such appointment under the Funding
Note Indenture, and thereupon such successor Funding Note Paying
Agent, without any further act, deed or conveyance, shall become
vested with all the authority, rights, powers, trusts, immunities,
duties and obligations of such predecessor with like effect as if
originally named as a Funding Note Paying Agent under the Funding Note
Indenture, and such predecessor, upon payment of any amounts due
pursuant to Section 4.5(g) and unpaid, shall
33
thereupon become obliged to transfer and deliver, and such successor
Funding Note Paying Agent shall be entitled to receive, copies of any
relevant records maintained by such predecessor Funding Note Paying
Agent.
(k) Any entity into which a Funding Note Paying Agent may be merged or
converted or with which it may be consolidated or any entity resulting
from any merger, conversion or consolidation to which such Funding
Note Paying Agent shall be a party, or any entity succeeding to all or
substantially all of the paying agency business of such Funding Note
Paying Agent shall be a successor Funding Note Paying Agent under the
Funding Note Indenture without the execution or filing of any paper or
any further act on the part of any of the parties, anything in the
Funding Note Indenture to the contrary notwithstanding. At least 30
days' prior notice of any such merger, conversion or consolidation
shall be given to Global Funding and the Funding Note Indenture
Trustee (unless the Funding Note Indenture Trustee is such Funding
Note Paying Agent).
SECTION 4.6 Funding Note Calculation Agent.
(a) Unless otherwise provided in or pursuant to the Funding Note
Indenture, Global Funding appoints the Funding Note Indenture Trustee
as Funding Note Calculation Agent, and the Funding Note Indenture
Trustee accepts such appointment.
(b) The relevant Funding Note Calculation Agent shall perform all
functions and obligations imposed on such Funding Note Calculation
Agent by or pursuant to the Funding Note Indenture, and the Funding
Note Certificate or supplemental Funding Note Indenture.
(c) Each Funding Note Calculation Agent, excluding the Funding Note
Indenture Trustee, shall forward to Global Funding at least monthly a
report providing details with respect to the performance of its
functions and obligations with respect to the Funding Note which shall
include dates and amounts of forthcoming payments with respect to the
Funding Note.
(d) The relevant Funding Note Calculation Agent shall, upon the request of
any relevant Holder of the Funding Note, provide the interest rate
then in effect and, if determined, the interest rate that will become
effective as a result of a determination made for the
34
next succeeding Interest Reset Date with respect to the Funding Note.
(e) All determinations of interest by the Funding Note Calculation Agent
shall, in the absence of manifest errors, be conclusive for all
purposes and binding on the Holders of the Funding Note.
(f) Global Funding shall pay the compensation of each Funding Note
Calculation Agent at such rates as shall be agreed upon in writing by
Global Funding and the relevant Funding Note Calculation Agent from
time to time and shall reimburse each Funding Note Calculation Agent
for reasonable expenses properly incurred by such Funding Note
Calculation Agent in connection with the performance of its duties
upon receipt of such invoices as Global Funding shall reasonably
require.
(g) Subject as provided below, each Funding Note Calculation Agent may at
any time resign as Funding Note Calculation Agent by giving not less
than 60 days' written notice to Global Funding and the Funding Note
Indenture Trustee (unless the Funding Note Indenture Trustee is such
Funding Note Calculation Agent) of such intention on its part,
specifying the date on which its resignation shall become effective.
Except as provided below, Global Funding may remove a Funding Note
Calculation Agent by giving not less than 20 days' written notice
specifying such removal and the date when it shall become effective.
Any such resignation or removal shall take effect upon:
(i) the appointment by Global Funding of a successor Funding Note
Calculation Agent; and
(ii) the acceptance of such appointment by such successor Funding Note
Calculation Agent,
provided that with respect to any Funding Note Calculation Agent who
fails duly to establish the interest rate or amount for any Interest
Reset Period, any such removal will take effect immediately upon such
appointment of, and acceptance thereof by, a successor Funding Note
Calculation Agent approved by the Funding Note Indenture Trustee
(unless the Funding Note Indenture Trustee is such Funding Note
Calculation Agent), in which event notice of such appointment shall be
given to each Holder of the Funding Note as soon as practicable
thereafter. Global Funding agrees with each Funding Note Calculation
Agent that if, by the day falling 10 days before the expiration of
35
any notice given pursuant to this Section 4.6(g), Global Funding has
not appointed a replacement Funding Note Calculation Agent, then the
Funding Note Calculation Agent shall be entitled, on behalf of Global
Funding, to appoint in its place a reputable financial institution of
good standing reasonably acceptable to Global Funding and the Funding
Note Indenture Trustee (unless the Funding Note Indenture Trustee is
such Funding Note Calculation Agent); provided, however, that
notwithstanding the foregoing, the resignation or removal of the
relevant Funding Note Calculation Agent shall not be effective unless,
upon the expiration of the notice given pursuant to this Section
4.6(g), the successor Funding Note Calculation Agent shall have
accepted its appointment. Upon its resignation or removal becoming
effective, the retiring Funding Note Calculation Agent shall be
entitled to the payment of its compensation and reimbursement of all
expenses incurred by such retiring Funding Note Calculation Agent
pursuant to Section 4.6(f) up to the effective date of such
resignation or removal.
(h) If at any time a Funding Note Calculation Agent shall resign or be
removed, or shall become incapable of acting with respect to the
Funding Note, or shall be adjudged as bankrupt or insolvent, or a
receiver or liquidator of such Funding Note Calculation Agent or of
its property shall be appointed, or any public officer shall take
charge or control of such Funding Note Calculation Agent or its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then a successor Funding Note Calculation Agent shall be
appointed by Global Funding by an instrument in writing filed with the
successor Funding Note Calculation Agent. Upon any such appointment
of, and the acceptance of such appointment by, a successor Funding
Note Calculation Agent and (except in cases of removal for failure to
establish the amount of interest) the giving of notice to each Holder
of the Funding Note, the retiring Funding Note Calculation Agent shall
cease to be Funding Note Calculation Agent under the Funding Note
Indenture.
(i) Any successor Funding Note Calculation Agent appointed under the
Funding Note Indenture shall execute and deliver to its predecessor,
Global Funding and the Funding Note Indenture Trustee (unless the
Funding Note Indenture Trustee is such Funding Note Calculation Agent)
a reasonably acceptable instrument, accepting such appointment under
the Funding Note Indenture, and thereupon such successor Funding Note
Calculation Agent, without any further act, deed or conveyance,
36
shall become vested with all the authority, rights, powers, trusts,
immunities, duties and obligations of such predecessor with like
effect as if originally named as a Funding Note Calculation Agent
under the Funding Note Indenture, and such predecessor, upon payment
of any amounts due pursuant to Section 4.6(f) and unpaid, shall
thereupon become obliged to transfer and deliver, and such successor
Funding Note Calculation Agent shall be entitled to receive, copies of
any relevant records maintained by such predecessor Funding Note
Calculation Agent.
(j) Any entity into which a Funding Note Calculation Agent may be merged
or converted or with which it may be consolidated or any entity
resulting from any merger, conversion or consolidation to which such
Funding Note Calculation Agent shall be a party, or an entity
succeeding to all or substantially all of the paying agency business
of such Funding Note Calculation Agent shall be a successor Funding
Note Calculation Agent under the Funding Note Indenture without the
execution or filing of any paper or any further act on the part of any
of the parties hereto, anything in the Funding Note Indenture to the
contrary notwithstanding. At least 30 days' prior notice of any such
merger, conversion or consolidation shall be given to Global Funding
and the Funding Note Indenture Trustee (unless the Funding Note
Indenture Trustee is such Funding Note Calculation Agent).
SECTION 4.7 Certificate to Funding Note Indenture Trustee. Global Funding
will furnish to the Funding Note Indenture Trustee on or before May 15 of each
year commencing with the first May 15 following the issuance of the Funding Note
a brief certificate (which need not comply with Section 13.5) as to its
knowledge of Global Funding's compliance with all conditions and covenants under
the Funding Note Indenture (which will be determined without regard to any
period of grace or requirement of notice provided under the Funding Note
Indenture).
SECTION 4.8 Negative Covenants. So long as the Funding Note is outstanding,
Global Funding will comply with all of its covenants set forth in Section 6.1(b)
of the Amended and Restated Trust Agreement.
SECTION 4.9 Non-Petition.
Each of the Funding Note Indenture Trustee, each other party hereto and
each Holder covenants and agrees that, for a period of one year plus one day
after payment in full of all amounts payable under or in respect of the Funding
Note Indenture and the Funding Note, it will not institute against, or join any
other Person in instituting against, Global Funding any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any federal or state bankruptcy or similar law.
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The immediately preceding sentence shall survive any termination of the Funding
Note Indenture.
Notwithstanding the foregoing, each of the Funding Note Indenture Trustee
and each other party hereto covenants and agrees that it will not institute
against, or join any other Person in instituting against, Global Funding any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings,
or other proceedings under any federal or state bankruptcy or similar law, as a
result of the failure to pay fees or expenses pursuant to Section 6.6 to any
party entitled thereto.
Moreover, each of the Funding Note Indenture Trustee and each other party
hereto covenants and agrees that it will not cause an Event of Default as a
result of Global Funding's failure to pay any fees or expenses to any party
entitled thereto under the Funding Note Indenture.
SECTION 4.10 Additional Amounts.
If the Funding Note Certificate provide for the payment of Additional
Amounts, Global Funding agrees to pay to the Holder of the Funding Note
Additional Amounts as provided in the Funding Note Certificate. Whenever in the
Funding Note Indenture there is mentioned, in any context, the payment of the
principal of, or interest or premium on, or in respect of, the Funding Note or
the net proceeds received on the sale or exchange of the Funding Note, such
reference shall be deemed to include reference to the payment of Additional
Amounts provided by the terms established by the Funding Note Indenture or
pursuant to the Funding Note Indenture to the extent that, in such context,
Additional Amounts are, were or would be payable in respect thereof pursuant to
such terms, and express reference to the payment of Additional Amounts in any
provision of the Funding Note Indenture shall not be construed as excluding
Additional Amounts in those provisions hereof where such express reference is
not made.
If the Funding Note Certificate provides for the payment of Additional
Amounts, the Funding Note Certificate will provide that Global Funding will pay,
or cause to be paid, Additional Amounts to a Holder of the Funding Note to
compensate for any withholding or deduction for or on account of any present or
future taxes, duties, levies, assessments or governmental charges of whatever
nature imposed or levied on payments on the Funding Note by or on behalf of any
governmental authority in the United States having the power to tax, so that the
net amount received by the Holder of the Funding Note, after giving effect to
such withholding or deduction, whether or not currently payable, will equal the
amount that would have been received under the Funding Note were no such
deduction or withholding required; provided that no such Additional Amounts
shall be required for or on account of:
(a) any tax, duty, levy, assessment or other governmental charge imposed
which would not have been imposed but for a Holder or
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beneficial owner of the Funding Note, (i) having any present or former
connection with the United States, including, without limitation,
being or having been a citizen or resident thereof, or having been
present, having been incorporated in, having engaged in a trade or
business or having (or having had) a permanent establishment or
principal office therein, (ii) being a controlled foreign corporation
within the meaning of Section 957(a) of the Code related within the
meaning of Section 864(d)(4) of the Code, to the Funding Agreement
Provider, (iii) being a bank for United States Federal income tax
purposes whose receipt of interest on the Funding Note is described in
Section 881(c)(3)(A) of the Code, (iv) being an actual or constructive
owner of 10 percent or more of the total combined voting power of all
classes of stock of the Funding Agreement Provider entitled to vote
within the meaning of Section 871(h)(3) of the Code and Treasury
Regulations promulgated thereunder or (v) being subject to backup
withholding as of the date of the purchase by the Holder of the
Funding Note;
(b) any tax, duty, levy, assessment or other governmental charge which
would not have been imposed but for the presentation of any Funding
Note (where presentation is required) for payment on a date more than
30 days after the date on which such payment becomes due and payable
or the date on which payment is duly provided for, whichever occurs
later;
(c) any tax, duty, levy, assessment or other governmental charge which is
imposed or withheld solely by reason of the failure of the beneficial
owner or a Holder of the Funding Note to comply with certification,
identification or information reporting requirements concerning the
nationality, residence, identity or connection with the United States
of the beneficial owner or a Holder of the Funding Note, if compliance
is required by statute, by regulation of the United States Treasury
Department, judicial or administrative interpretation, other law or by
an applicable income tax treaty to which the United States is a party
as a condition to exemption from such tax, duty, levy, assessment or
other governmental charge;
(d) any inheritance, gift, estate, personal property, sales, transfer or
similar tax, duty, levy, assessment, or similar governmental charge;
39
(e) any tax, duty, levy, assessment or other governmental charge that is
payable otherwise than by withholding from payments in respect of the
Funding Note;
(f) any tax, duty, levy, assessment or other governmental charge imposed
by reason of payments on the Funding Note being treated as contingent
interest described in Section 871(h)(4) of the Code for United States
Federal income tax purposes provided that such treatment was described
in the Pricing Supplement;
(g) any tax, duty, levy, assessment or other governmental charge that
would not have been imposed but for an election by the Holder of the
Funding Note, the effect of which is to make payment in respect of the
Funding Note subject to United States Federal income tax or
withholding tax provisions; or
(h) any combination of items (a), (b), (c), (d), (e), (f) or (g) above.
ARTICLE 5
REMEDIES OF THE FUNDING NOTE INDENTURE TRUSTEE AND HOLDERS ON EVENT OF
DEFAULT
SECTION 5.1 Event of Default Defined; Acceleration of Maturity; Waiver of
Default.
(a) "Event of Default" with respect to the Funding Note wherever used in
the Funding Note Indenture, means each of the following events which
shall have occurred and be continuing (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or
be effected by operation of law or pursuant to any judgment, decree or
order of any court or any order, rule or regulation of any
administrative or governmental body):
(i) default in the payment when due and payable of the principal of,
or any premium on, the Funding Note;
(ii) default in the payment, when due and payable, of any interest on,
or any Additional Amounts with respect to, the Funding Note and
continuance of such default for a period of five Business Days;
(iii) any "Event of Default", as such term is defined in any Funding
Agreement securing the Funding Note, by the Funding Agreement
Provider under such Funding Agreement;
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(iv) Global Funding shall fail to observe or perform any covenant
contained in the Funding Note or in the Funding Note Indenture
for a period of 30 days after the date on which written notice
specifying such failure, stating that such notice is a "Notice of
Default" under the Funding Note Indenture and demanding that
Global Funding remedy the same, will have been given by
registered or certified mail, return receipt requested, to Global
Funding by the Funding Note Indenture Trustee, or to Global
Funding and the Funding Note Indenture Trustee by the Holder or
Holders of at least 25% of the outstanding principal amount of
the Funding Note; or
(v) the Funding Note Indenture for any reason shall cease to be in
full force and effect or shall be declared null and void, or the
Funding Note Indenture Trustee shall fail to have or maintain a
validly created and first priority perfected security interest
(or the equivalent thereof) in the Collateral; or any Person
shall successfully claim, as finally determined by a court of
competent jurisdiction that any Lien for the benefit of the
Holders of the Funding Note and any other Person for whose
benefit the Funding Note Indenture Trustee is or will be holding
the Collateral, that the Collateral is void or is junior to any
other Lien or that the enforcement thereof is materially limited
because of any preference, fraudulent transfer, conveyance or
similar law;
(vi) an involuntary case or other proceeding shall be commenced
against Global Funding seeking liquidation, reorganization or
other relief with respect to it or its debts under any
bankruptcy, insolvency, reorganization or other similar law or
seeking the appointment of a trustee, receiver, liquidator,
custodian or other similar official of it or any substantial part
of its property, and such involuntary case or other proceeding
shall remain undismissed and unstayed for a period of 60 days; or
an order for relief shall be entered against Global Funding under
the Federal bankruptcy laws as now or hereafter in effect;
(vii) Global Funding commences a voluntary case or other proceeding
seeking liquidation, reorganization or other relief with respect
to itself or its debts under any bankruptcy, insolvency,
reorganization or other similar
41
law or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any
substantial part of its property, or consents to any such relief
or to the appointment of or taking possession by any such
official in an involuntary case or other proceeding commenced
against it, or makes a general assignment for the benefit of
creditors, or fails generally to pay its debts as they become
due, or takes any action to authorize any of the foregoing; and
(viii) any other Event of Default provided in any Supplemental Funding
Note Indenture or in the Funding Note Certificate.
(b) If one or more Events of Default shall have occurred and be continuing
with respect to the Funding Note, then, and in every such event,
unless the principal of the Funding Note shall have already become due
and payable, either the Funding Note Indenture Trustee or the Holder
or Holders of not less than 25% of the outstanding principal amount of
the Funding Note under the Funding Note Indenture by notice in writing
to Global Funding (and to the Funding Note Indenture Trustee if given
by such Holder or Holders), may declare the entire principal and
premium (if any) of the Funding Note, any interest accrued thereon,
and any Additional Amounts due and owing and any other amounts payable
with respect thereto, to be due and payable immediately, and upon any
such declaration the same shall become immediately due and payable;
provided that, if any Event of Default specified in Section 5.1(a)(vi)
or 5.1(a)(vii) occurs with respect to Global Funding, or if any Event
of Default specified in Section 5.1(a)(iii) that would cause any
Funding Agreement securing the Funding Note to become immediately due
and payable occurs with respect to the Funding Agreement Provider,
then without any notice to Global Funding or any other act by the
Funding Note Indenture Trustee or any Holder of the Funding Note, the
entire principal and premium (if any) of the Funding Note, any
interest accrued thereon, and any Additional Amounts due and owing,
and any other amounts payable with respect thereto, shall become
immediately due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by Global
Funding.
(c) Notwithstanding Section 5.1(b), if at any time after the principal and
premium of the Funding Note, any interest accrued thereon, and any
Additional Amounts due and owing and any other
42
amounts payable with respect thereto shall have been so declared due
and payable and before any judgment or decree for the payment of the
funds due shall have been obtained or entered as provided in the
Funding Note Indenture, Global Funding shall pay or shall deposit with
the Funding Note Indenture Trustee a sum sufficient to pay all due and
payable interest on, and any Additional Amounts due and owing and any
other amounts payable with respect to, the Funding Note and the
principal and premium (if any) of the Funding Note which shall have
become due and payable otherwise than by acceleration pursuant to
Section 5.1(b) above (with interest on such principal and, to the
extent that payment of such interest is enforceable under applicable
law, on any overdue interest and any other amounts payable, at the
same rate as the rate of interest specified in the Funding Note
Certificate to the date of such payment or deposit) and such amount as
shall be sufficient to cover reasonable compensation to the Funding
Note Indenture Trustee and each predecessor Funding Note Indenture
Trustee, their respective agents, attorneys and counsel, and all other
expenses and liabilities incurred, and all advances made, by the
Funding Note Indenture Trustee and each predecessor Funding Note
Indenture Trustee except as a result of negligence or bad faith, and
if any and all Events of Default under the Funding Note Indenture,
other than the non-payment of the principal of and premium (if any) on
the Funding Note which shall have become due by acceleration, shall
have been cured, waived or otherwise remedied as provided in the
Funding Note Indenture, then and in every such case the Holder
Representative (as defined in Section 5.8(a) hereof), by written
notice to Global Funding and to the Funding Note Indenture Trustee,
may waive all defaults and rescind and annul such declaration and its
consequences, but no such waiver or rescission and annulment shall
extend to or shall affect any subsequent default or shall impair any
right consequent thereon.
SECTION 5.2 Collection of Indebtedness by Funding Note Indenture Trustee;
Funding Note Indenture Trustee May Prove Debt.
(a) Subject to Section 5.1(c), if any Event of Default contained in
Section 5.1(a)(i) or (ii) shall have occurred and be continuing,
Global Funding will, upon demand by the Funding Note Indenture
Trustee, pay to the Funding Note Indenture Trustee for the benefit of
each Holder of the Funding Note the whole amount that then shall have
become due and payable of the principal of, any premium and interest
on, and any Additional Amounts due
43
and owing and any other amounts payable with respect to, the Funding
Note (with interest to the date of such payment upon the overdue
principal and, to the extent that payment of such interest is
enforceable under applicable law, on overdue interest and any other
amounts payable at the same rate as the rate of interest specified in
the Funding Note); and in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of collection,
including reasonable compensation to the Funding Note Indenture
Trustee and each predecessor Funding Note Indenture Trustee, their
respective agents, attorneys and counsel, and any expenses and
liabilities incurred, and all advances made, by the Funding Note
Indenture Trustee and each predecessor Funding Note Indenture Trustee
except as a result of its negligence or bad faith.
(b) Until such demand is made by the Funding Note Indenture Trustee,
Global Funding may pay the principal of, any premium and interest on,
and any Additional Amounts due and owing and any other amounts payable
with respect to, the Funding Note to the Holders, whether or not the
Funding Note be overdue.
(c) If Global Funding shall fail to pay such amounts upon such demand, the
Funding Note Indenture Trustee, in its own name and as trustee of an
express trust, shall be entitled and empowered to institute any action
or proceedings at law or in equity for the collection of the sums so
due and unpaid, and may prosecute any such action or proceedings to
judgment or final decree, and may enforce any such judgment or final
decree against Global Funding or other obligor upon the Funding Note
and collect in the manner provided by law out of the property of
Global Funding or other obligor upon the Funding Note, wherever the
funds adjudged or decreed to be payable are situated. If there shall
be pending proceedings relative to Global Funding or any other obligor
upon the Funding Note under Title 11 of the United States Code or any
other applicable Federal or state bankruptcy, insolvency or other
similar law, or if a receiver, assignee or trustee in bankruptcy or
reorganization, liquidator, sequestrator or similar official shall
have been appointed for or taken possession of Global Funding or its
property or such other obligor, or in case of any other comparable
judicial proceedings relative to Global Funding or other obligor upon
the Funding Note, or to the creditors or property of Global Funding or
such other obligor, the Funding Note Indenture Trustee, irrespective
of whether the principal of the Funding Note shall then be due and
payable as therein expressed or by
44
declaration or otherwise and irrespective of whether the Funding Note
Indenture Trustee shall have made any demand pursuant to the
provisions of this Section, shall be entitled and empowered, by
intervention in such proceedings or otherwise:
(i) to file such proofs of a claim or claims and to file such other
papers or documents as may be necessary or advisable in order to
have the claims of the Funding Note Indenture Trustee (including
any claim for reasonable compensation to the Funding Note
Indenture Trustee and each predecessor Funding Note Indenture
Trustee, and their respective agents, attorneys and counsel, and
for reimbursement of all expenses and liabilities incurred, and
all advances made, by the Funding Note Indenture Trustee and each
predecessor Funding Note Indenture Trustee, except as those
adjudicated in a court of competent jurisdiction to be the result
of any such Funding Note Indenture Trustee's negligence or bad
faith) and of the Holders allowed in any judicial proceedings
relative to Global Funding or other obligor upon the Funding
Note, or to the creditors or property of Global Funding or such
other obligor,
(ii) unless prohibited by applicable law and regulations, to vote on
behalf of the Holders of the Funding Note in any election of a
trustee or a standby trustee in arrangement, reorganization,
liquidation or other bankruptcy or insolvency proceedings or
Person performing similar functions in comparable proceedings,
and
(iii) to collect and receive any funds or other property payable or
deliverable on any such claims, and to distribute all amounts
received with respect to the claims of each Holder and of the
Funding Note Indenture Trustee on each Holder's behalf; and any
trustee, receiver, or liquidator, custodian or other similar
official is hereby authorized by each Holder to make payments to
the Funding Note Indenture Trustee, and, in the event that the
Funding Note Indenture Trustee shall consent to the making of
payments directly to any Holder, to pay to the Funding Note
Indenture Trustee such amounts as shall be sufficient to cover
reasonable compensation to the Funding Note Indenture Trustee,
each predecessor Funding Note Indenture Trustee and their
respective agents, attorneys and counsel, and all other expenses
and
45
liabilities incurred, and all advances made, by the Funding Note
Indenture Trustee and each predecessor Funding Note Indenture
Trustee except as those adjudicated in a court of competent
jurisdiction to be the result of any such Funding Note Indenture
Trustee's negligence or bad faith.
(d) Nothing contained in the Funding Note Indenture shall be deemed to
authorize the Funding Note Indenture Trustee to authorize or consent
to or vote for or accept or adopt on behalf of any Holder any plan or
reorganization, arrangement, adjustment or composition affecting the
Funding Note or the rights of any Holder thereof, or to authorize the
Funding Note Indenture Trustee to vote in respect of the claim of any
Holder in any such proceeding except, as aforesaid, to vote for the
election of a trustee in bankruptcy or similar Person.
(e) All rights of action and of asserting claims under the Funding Note
Indenture, or under the Funding Note, may be enforced by the Funding
Note Indenture Trustee without the possession of the Funding Note or
the production thereof on any trial or other proceedings relative
thereto, and any such action or proceedings instituted by the Funding
Note Indenture Trustee shall be brought in its own name as trustee of
an express trust, and any recovery of judgment, subject to the payment
of the expenses, disbursements and compensation of the Funding Note
Indenture Trustee, each predecessor Funding Note Indenture Trustee and
their respective agents and attorneys, shall be for the ratable
benefit of each Holder.
(f) In any proceedings brought by the Funding Note Indenture Trustee (and
also any proceedings involving the interpretation of any provision of
the Funding Note Indenture to which the Funding Note Indenture Trustee
shall be a party) the Funding Note Indenture Trustee shall be held to
represent every Holder of the Funding Note, and it shall not be
necessary to make any Holder of the Funding Note party to any such
proceedings.
SECTION 5.3 Application of Proceeds.
(a) Any funds collected by the Funding Note Indenture Trustee following an
Event of Default pursuant to this Article or otherwise under the
Funding Note Indenture and any applicable Supplemental Funding Note
Indenture in respect of the Funding Note shall be held in trust in the
Collection Account and be applied in the following order at the date
or dates fixed by the
46
Funding Note Indenture Trustee and, in case of the distribution of
such funds on account of principal, any premium and interest and any
Additional Amounts, upon presentation of the Funding Note Certificate
representing the Funding Note and the notation thereon of the payment
if only partially paid or upon the surrender thereof if fully paid:
First: To the payment of costs and expenses, including reasonable
compensation to the Funding Note Indenture Trustee and each predecessor
Funding Note Indenture Trustee and their respective agents and attorneys
and of all expenses and liabilities incurred, and all advances made, by the
Funding Note Indenture Trustee and each predecessor Funding Note Indenture
Trustee except those adjudicated in a court of competent jurisdiction to be
the result of any such Funding Note Indenture Trustee's negligence or bad
faith, in an aggregate amount of no more than $250,000 for all Program
Funding Notes, the extent not paid pursuant to the Amended and Restated
Support Agreement;
Second: To the payment of principal, any premium and interest, any
Additional Amounts and any other amounts then due and owing on the Funding
Note;
Third: To the payment of any other Obligations then due and owing with
respect to the Funding Note; and
To the payment of any remaining balance to Global Funding for Fourth:
distribution by the Delaware Trustee in accordance with the provisions of
the Amended and Restated Trust Agreement.
(b) All funds deposited with the Funding Note Indenture Trustee pursuant
to the Funding Note Indenture, except when an Event of Default has
occurred and is continuing, shall be held in trust in the Collection
Account and applied by it, in accordance with the provisions of the
Funding Note and the Funding Note Indenture, to the payment through
any Funding Note Paying Agent, to the Persons entitled thereto, of the
principal, premium, if any, interest and Additional Amounts, if any,
for whose payment such money has been deposited with or received by
the Funding Note Trustee. If no Event of Default with respect to he
Funding Note has occurred and is continuing, the following priority of
payments shall apply:
First: To the payment of principal, any premium and interest, any
Additional Amounts, and any other amounts then due and owing on the Funding
Note;
47
Second: To the payment of any other Obligations then due and owing
with respect to the Funding Note; and
Third: To the payment of any remaining balance to Global Funding for
distribution by the Delaware Trustee in accordance with the provisions of
the Amended and Restated Trust Agreement.
The Funding Note Indenture Trustee may make distributions under the Funding
Note Indenture in cash or in kind or, on a ratable basis, in any combination
thereof.
SECTION 5.4 Suits for Enforcement. If an Event of Default has occurred, has
not been waived and is continuing, the Funding Note Indenture Trustee may in its
discretion proceed to protect and enforce the rights vested in it by the Funding
Note Indenture by such appropriate judicial proceedings as the Funding Note
Indenture Trustee shall deem most effectual to protect and enforce any of such
rights, either at law or in equity or in bankruptcy or otherwise, whether for
the specific enforcement of any covenant or agreement contained in the Funding
Note Indenture or in aid of the exercise of any power granted in the Funding
Note Indenture or to enforce any other legal or equitable right vested in the
Funding Note Indenture Trustee by the Funding Note Indenture or by law.
SECTION 5.5 Restoration of Rights on Abandonment of Proceedings. If the
Funding Note Indenture Trustee shall have proceeded to enforce any right under
the Funding Note Indenture and such proceedings shall have been discontinued or
abandoned for any reason, or shall have been determined adversely to the Funding
Note Indenture Trustee, then and in every such case Global Funding and the
Funding Note Indenture Trustee shall be restored respectively to their former
positions and rights under the Funding Note Indenture, and all rights, remedies
and powers of Global Funding, the Funding Note Indenture Trustee and each Holder
shall continue as though no such proceedings had been taken.
SECTION 5.6 Limitations on Suits by Holders. No Holder of the Funding Note
shall have any right by virtue or by availing of any provision of the Funding
Note Indenture to institute any action or proceeding at law or in equity or in
bankruptcy or otherwise upon or under or with respect to the Funding Note
Indenture, or for the appointment of a trustee, receiver, liquidator, custodian
or other similar official or for any other remedy under the Funding Note
Indenture, unless:
(i) such Holder has previously given written notice to the Funding
Note Indenture Trustee of a continuing Event of Default;
(ii) the Holder or Holders of the Funding Note representing not less
than 25% of the outstanding principal amount of the Funding Note
shall have made written request to the
48
Funding Note Indenture Trustee to institute proceedings in
respect of such Event of Default in its own name as the Funding
Note Indenture Trustee;
(iii) such Holder or Holders have offered to the Funding Note
Indenture Trustee indemnity or security satisfactory to it
against the costs, expenses and liabilities to be incurred in
compliance with such request;
(iv) the Funding Note Indenture Trustee for 60 days after its receipt
of such notice, request and offer of indemnity shall have failed
to institute any such action or proceedings; and
(v) no direction inconsistent with such written request shall have
been given to the Funding Note Indenture Trustee during such
60-day period by the Holder or Holders of the Funding Note
representing at least 66 2/3% of the outstanding principal amount
of the Funding Note;
it being understood and intended, and being expressly covenanted by each Holder
of the Funding Note with each other Holder of the Funding Note and the Funding
Note Indenture Trustee, that no Holder or Holders of the Funding Note shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of the Funding Note Indenture to affect, disturb or prejudice the rights of any
other Holder of the Funding Note, or to obtain or seek to obtain priority over
or preference to any other Holder of the Funding Note or to enforce any right
under the Funding Note Indenture, except in the manner provided herein and for
the equal, ratable and common benefit of all the Holders of the Funding Note.
For the protection and enforcement of the provisions of this Section, each
Holder and the Funding Note Indenture Trustee shall be entitled to such relief
as can be given either at law or in equity.
Notwithstanding any other provisions in the Funding Note Indenture,
however, the right of any Holder of the Funding Note, which is absolute and
unconditional, to receive payment of the principal of (and premium, if any), and
interest on, if any, and Additional Amounts, if any, with respect to the Funding
Note, on or after the respective due dates expressed in the Funding Note, or to
institute suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder.
SECTION 5.7 Powers and Remedies Cumulative; Delay or Omission Not Waiver of
Default.
(a) Except as provided in Section 2.7, no right or remedy in the Funding
Note Indenture conferred upon or reserved to the
49
Funding Note Indenture Trustee or to any Holder is intended to be
exclusive of any other right or remedy, and every right and remedy
shall, to the extent permitted by law, be cumulative and in addition
to every other right and remedy given under the Funding Note Indenture
or existing at law or in equity or otherwise. The assertion or
employment of any right or remedy under the Funding Note Indenture, or
otherwise, shall not prevent the concurrent assertion or employment of
any other appropriate right or remedy.
(b) No delay or omission of the Funding Note Indenture Trustee or of any
Holder of the Funding Note to exercise any right or power accruing
upon any Event of Default occurring and continuing as aforesaid shall
impair any such right or power or shall be construed to be a waiver of
any such Event of Default or an acquiescence therein; and, subject to
Section 5.6, every power and remedy given by the Funding Note
Indenture or by law to the Funding Note Indenture Trustee or to any
Holder may be exercised from time to time, and as often as shall be
deemed expedient, by the Funding Note Indenture Trustee or by such
Holder.
SECTION 5.8 Control by the Holders.
(a) The Holders of a majority in principal amount of the Funding Note at
the time outstanding shall have the right to elect a holder
representative (the "Holder Representative") who shall have binding
authority upon all the Holders and shall replace any Holder
Representative then acting in such capacity, and who shall direct the
time, method, and place of conducting any proceeding for any remedy
available to the Funding Note Indenture Trustee, or exercising any
trust or power conferred on the Funding Note Indenture Trustee by the
Funding Note Indenture, provided that:
(i) such direction shall not be otherwise than in accordance with law
and the provisions of the Funding Note Indenture; and
(ii) subject to the provisions of Section 6.1, the Funding Note
Indenture Trustee shall have the right to decline to follow any
such direction if the Funding Note Indenture Trustee, being
advised by counsel, shall determine that the action or proceeding
so directed may not lawfully be taken or if the Funding Note
Indenture Trustee in good faith by its board of directors, the
executive committee, or a trust
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committee of directors or Responsible Officers of the Funding
Note Indenture Trustee shall determine that the action or
proceedings so directed would involve the Funding Note Indenture
Trustee in personal liability.
(b) Nothing in the Funding Note Indenture shall impair the right of the
Funding Note Indenture Trustee in its discretion to take any action
deemed proper by the Funding Note Indenture Trustee and which is not
inconsistent with such direction by the Holders.
SECTION 5.9 Waiver of Past Defaults. Prior to the declaration of the
maturity of the Funding Note as provided in Section 5.1, the Holder
Representative may on behalf of the Holders of the Funding Note waive any past
default or Event of Default under the Funding Note Indenture and its
consequences, except a default:
(i) in the payment of principal of, any premium or interest on, or
any Additional Amounts with respect to, the Funding Note; or
(ii) in respect of a covenant or provision of the Funding Note
Indenture which cannot be modified or amended without the consent
of the Holder of the Funding Note.
Upon any such waiver, such default shall cease to exist and be deemed to have
been cured and not to have occurred, and any Event of Default arising therefrom
shall be deemed to have been cured, and not to have occurred for every purpose
of the Funding Note Indenture; but no such waiver shall extend to any subsequent
or other default or Event of Default or impair any right consequent thereon.
ARTICLE 6
THE FUNDING NOTE INDENTURE TRUSTEE
SECTION 6.1 Certain Duties and Responsibilities.
(a) Except if an Event of Default has occurred and is continuing (and it
has not been cured or waived), the Funding Note Indenture Trustee
undertakes to perform in a prudent manner such duties and only such
duties with respect to the Funding Note as are specifically set forth
in the Funding Note Indenture. No implied covenants or obligations
shall be read into the Funding Note Indenture against the Funding Note
Indenture Trustee.
(b) If an Event of Default has occurred and is continuing (and it has not
been cured or waived), the Funding Note Indenture Trustee shall
exercise such of the rights and powers with respect to the Funding
Note vested in it by the Funding Note Indenture, and use
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the same degree of care and skill in their exercise, as a prudent
person would exercise or use under the circumstances in the conduct of
his or her own affairs.
(c) No provision of the Funding Note Indenture shall be construed to
relieve the Funding Note Indenture Trustee from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this subsection (c) shall not be construed to limit the effect of
subsection (a) of this Section;
(ii) in the absence of bad faith on its part, the Funding Note
Indenture Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein,
upon certificates or opinions furnished to the Funding Note
Indenture Trustee and conforming to the requirements of the
Funding Note Indenture unless a Responsible Officer of the
Funding Note Indenture Trustee has actual knowledge that such
statements or opinions are false; provided that the Funding Note
Indenture Trustee must examine such certificates and opinions to
determine whether they conform to the requirements of the Funding
Note Indenture;
(iii) the Funding Note Indenture Trustee shall not be liable for any
error of judgment made in good faith by any Responsible Officer
of the Funding Note Indenture Trustee, unless it is proved that
the Funding Note Indenture Trustee was negligent in ascertaining
the pertinent facts;
(iv) the Funding Note Indenture Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good
faith in accordance with the direction of the Holder
Representative relating to the time, method and place of
conducting any proceeding for any remedy available to the Funding
Note Indenture Trustee, or exercising any trust or power
conferred upon the Funding Note Indenture Trustee, under the
Funding Note Indenture with respect to the Funding Note; and
(v) no provision of the Funding Note Indenture shall require the
Funding Note Indenture Trustee to expend or risk its own funds or
otherwise incur any financial liability in the
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performance of any of its duties under the Funding Note
Indenture, or in the exercise of any of its rights or powers, if
it shall have reasonable grounds for believing that repayment of
such funds or adequate indemnity against such liability is not
reasonably assured to it.
(d) Whether or not therein expressly so provided, every provision of the
Funding Note Indenture relating to the conduct or affecting the
liability of or affording protection to the Funding Note Indenture
Trustee shall be subject to the provisions of this Section.
SECTION 6.2 Certain Rights of the Funding Note Indenture Trustee.
Subject to Section 6.1:
(a) the Funding Note Indenture Trustee may rely and shall be protected in
acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent,
order, bond, debenture, note, coupon, security or other paper or
document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) any request, direction, order or demand of Global Funding mentioned in
the Funding Note Indenture shall be sufficiently evidenced by a Trust
Certificate (unless other evidence in respect thereof be specifically
prescribed in the Funding Note Indenture);
(c) the Funding Note Indenture Trustee may consult with counsel and any
advice or Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted to
be taken by it under the Funding Note Indenture in good faith and in
reliance on such advice or Opinion of Counsel;
(d) the Funding Note Indenture Trustee shall be under no obligation to
exercise any of the trusts or powers vested in it by the Funding Note
Indenture at the request, order or direction of any Holder
Representative pursuant to the provisions of the Funding Note
Indenture, unless such Holder Representative shall have offered to the
Funding Note Indenture Trustee reasonable security or indemnity
against the costs, expenses and liabilities which might be incurred by
it in compliance with such request, order or direction;
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(e) whenever in the administration of the Funding Note Indenture the
Funding Note Indenture Trustee shall deem it necessary or desirable
that a matter be proved or established prior to taking or suffering or
omitting any action under the Funding Note Indenture, such matter
(unless other evidence in respect thereof be specifically prescribed
in the Funding Note Indenture) may, in the absence of negligence or
bad faith on its part, be deemed to be conclusively proved and
established by a Trust Certificate delivered to the Funding Note
Indenture Trustee;
(f) the Funding Note Indenture Trustee shall not be liable for any action
taken or omitted by it in good faith and believed by it to be
authorized or within the discretion, rights or powers conferred upon
it by the Funding Note Indenture;
(g) the Funding Note Indenture Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
consent, order, approval, appraisal, bond, debenture, note, coupon,
security, or other paper or document unless requested in writing so to
do by the Holder Representative; provided that, if the payment within
a reasonable time to the Funding Note Indenture Trustee of the costs,
expenses or liabilities likely to be incurred by it in the making of
such investigation is, in the opinion of the Funding Note Indenture
Trustee, not reasonably assured to the Funding Note Indenture Trustee
by the security afforded to it by the terms of the Funding Note
Indenture, the Funding Note Indenture Trustee may require reasonable
indemnity against such expenses or liabilities as a condition to
proceeding; the reasonable expenses of every such examination shall be
paid by Global Funding or, if paid by the Funding Note Indenture
Trustee or any predecessor trustee, shall be repaid by Global Funding
upon demand; and
(h) the Funding Note Indenture Trustee may execute any of the trusts or
powers under the Funding Note Indenture or perform any duties under
the Funding Note Indenture either directly or by or through agents or
attorneys not regularly in its employ and the Funding Note Indenture
Trustee shall not be responsible for any misconduct or negligence on
the part of any such agent or attorney appointed with due care by it
under the Funding Note Indenture.
SECTION 6.3 Not Responsible for Recitals, Validity of the Funding Note or
Application of the Proceeds. The recitals contained in the Funding Note
Indenture
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and in the Funding Note, except the Funding Note Indenture Trustee's
certificates of authentication, shall be taken as the statements of Global
Funding, and the Funding Note Indenture Trustee assumes no responsibility for
the correctness of the same. The Funding Note Indenture Trustee makes no
representation as to the validity or sufficiency of the Funding Note Indenture
or of the Funding Note. The Funding Note Indenture Trustee shall not be
accountable for the use or application by the Funding Agreement Provider of the
proceeds of the Funding Agreement(s).
SECTION 6.4 May Hold Funding Note; Collections, Etc. The Funding Note
Indenture Trustee or any agent of Global Funding or the Funding Note Indenture
Trustee, in its individual or any other capacity, may become the owner or
pledgee of the Funding Note with the same rights it would have if it were not
the Funding Note Indenture Trustee or such agent and, subject to Section 6.7,
Section 311(a) of the Trust Indenture Act, and Rule 3a-7 of the Investment
Company Act, may otherwise deal with Global Funding and receive, collect, hold
and retain collections from Global Funding with the same rights it would have if
it were not the Funding Note Indenture Trustee or such agent.
SECTION 6.5 Funds Held by Funding Note Indenture Trustee. Subject to the
provisions of Section 11.4, all funds received by the Funding Note Indenture
Trustee shall, until used or applied as provided in the Funding Note Indenture,
be held in trust for the purposes for which they were received. The Funding Note
Indenture Trustee (and each of its agents and Affiliates) shall deposit all cash
amounts received by it (or any such agents or Affiliates) that are derived from
the Collateral for the benefit of the Holders of the Funding Note in the
Collection Account. Neither the Funding Note Indenture Trustee nor any agent of
Global Funding or the Funding Note Indenture Trustee shall be under any
liability for interest on any funds received by it under the Funding Note
Indenture.
SECTION 6.6 Compensation; Reimbursement; Indemnification.
(a) Global Funding covenants and agrees:
(i) to pay to the Funding Note Indenture Trustee from time to time,
and the Funding Note Indenture Trustee shall be entitled to,
reasonable compensation for all services rendered by it under the
Funding Note Indenture (which compensation shall not be limited
by any provision of law in regard to the compensation of a
trustee of an express trust);
(ii) except as otherwise provided in the Funding Note Indenture, to
pay or reimburse the Funding Note Indenture Trustee upon its
request for all reasonable expenses, disbursements and advances
incurred or made
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by the Funding Note Indenture Trustee in accordance with any
provision of the Funding Note Indenture (including the reasonable
compensation and the expenses and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may
arise from its negligence or bad faith; and
(iii) to indemnify the Funding Note Indenture Trustee for, and to hold
it harmless against, any loss, liability or expense incurred
without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of the Funding
Note Indenture or the trusts under the Funding Note Indenture and
its duties under the Funding Note Indenture, including the costs
and expenses of defending itself against or investigating any
claim of liability in connection with the exercise or performance
of any of its powers or duties under the Funding Note Indenture.
(b) The obligations of Global Funding under this Section to compensate and
indemnify the Funding Note Indenture Trustee and to pay or reimburse
the Funding Note Indenture Trustee for expenses, disbursements and
advances shall constitute additional indebtedness under the Funding
Note Indenture and shall survive the satisfaction and discharge of the
Funding Note Indenture and any resignation or removal of the Funding
Note Indenture Trustee.
SECTION 6.7 Corporate Trustee Required; Eligibility.
(a) There shall at all times be a Funding Note Indenture Trustee under the
Funding Note Indenture which shall:
(i) be a banking corporation or national association authorized under
its laws of incorporation or formation and the laws of the
jurisdiction in which it administers the Funding Note Indenture
and any Supplemental Funding Note Indenture to exercise corporate
trust powers, having an aggregate capital, surplus of at least
$50,000,000; provided that if such banking corporation or
national association publishes reports of condition at least
annually, pursuant to law or to the requirements of its Federal,
State or other governmental supervisor, then for the purposes of
this Section, the aggregate capital, surplus and undivided
profits of such banking corporation or
56
national association shall be deemed to be its aggregate capital,
surplus and undivided profits as set forth in its most recent
report of condition so published;
(ii) not be affiliated (as such term is defined in Rule 405 under the
Securities Act) with Global Funding or with any Person involved
in the organization or operation of Global Funding; and
(iii) not offer or provide credit or credit enhancement to Global
Funding.
(b) If at any time the Funding Note Indenture Trustee shall cease to be
eligible in accordance with the provisions of Section 6.7(a) or the
requirements of Section 310 of the Trust Indenture Act, the Funding
Note Indenture Trustee shall resign immediately in the manner and with
the effect specified in Section 6.8.
SECTION 6.8 Resignation and Removal; Appointment of Successor Trustee.
(a) The Funding Note Indenture Trustee may at any time resign by giving
not less than 90 days' prior written notice of resignation to Global
Funding and to the Holders of the Funding Note as provided in the
Funding Note Indenture. Upon receiving such notice of resignation,
Global Funding shall promptly cause a successor trustee with respect
to the applicable series to be appointed by written instrument in
duplicate, executed by Global Funding, one copy of which instrument
shall be delivered to the resigning trustee and one copy to the
successor trustee. If no successor trustee shall have been so
appointed and have accepted appointment within 30 days after the
giving of such notice of resignation, the resigning trustee may
petition any court of competent jurisdiction for the appointment of a
successor trustee. Such court may thereupon, after such notice, if
any, as it may deem proper and prescribe, appoint a successor trustee.
(b) If at any time:
(i) the Funding Note Indenture Trustee shall cease to be eligible in
accordance with the provisions of Section 6.7(a) or the
requirements of Section 310 of the Trust Indenture Act or any
applicable Supplemental Funding Note Indenture and shall fail to
resign pursuant to Section
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6.7(b) or following written request therefor by Global Funding or
by any such Holder pursuant to Section 6.8(c);
(ii) the Funding Note Indenture Trustee shall become incapable of
acting with respect to the Funding Note, or shall be adjudged as
bankrupt or insolvent, or a receiver or liquidator of the Funding
Note Indenture Trustee or of its property shall be appointed, or
any public officer shall take charge or control of the Funding
Note Indenture Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation; or
(iii) the Funding Note Indenture Trustee shall fail to comply with the
obligations imposed upon it under Section 310(b) of the Trust
Indenture Act with respect to the Funding Note after written
request therefor by Global Funding or any Holder of the Funding
Note who has been a bona fide Holder of the Funding Note for at
least six months;
then, in any such case, except during the existence of an Event of
Default, Global Funding may remove the Funding Note Indenture Trustee
and appoint a successor trustee by written instrument, in duplicate,
one copy of which instrument shall be delivered to the Funding Note
Indenture Trustee so removed and one copy to the successor trustee.
(c) In addition to the right of petition given to the resigning trustee
and the right of removal given to Global Funding under Sections 6.8(a)
and 6.8(b), respectively, any Holder who has been a Holder of the
Funding Note for at least six months may, on behalf of itself and all
others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor trustee or the removal
of the Funding Note Indenture Trustee and the appointment of a
successor trustee, as the case may be. Such court may thereupon, after
such notice, if any, as it may deem proper and prescribe, appoint a
successor trustee or remove the Funding Note Indenture Trustee and
appoint a successor trustee, as the case may be.
(d) The Holder Representative may at any time remove the Funding Note
Indenture Trustee and appoint a successor trustee by delivering to the
Funding Note Indenture Trustee so removed, to the successor trustee so
appointed and to Global Funding the evidence provided for in Section
8.1 of the action in that regard taken by a Holder.
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(e) Any resignation or removal of the Funding Note Indenture Trustee and
any appointment of a successor trustee pursuant to any of the
provisions of this Section 6.8 shall only become effective upon
acceptance of appointment by the successor trustee as provided in
Section 6.9.
SECTION 6.9 Acceptance of Appointment by Successor Funding Note Trustee.
(a) Every successor trustee appointed as provided in Section 6.8 shall
execute, acknowledge and deliver to Global Funding and to its
predecessor trustee an instrument accepting such appointment, and
thereupon the resignation or removal of the predecessor trustee shall
become effective and such successor trustee, without any further act,
deed or conveyance, shall become vested with all rights, powers,
duties and obligations of its predecessor under the Funding Note
Indenture, with like effect as if originally named as trustee under
the Funding Note Indenture; but, nevertheless, on the written request
of Global Funding or of the successor trustee, upon payment of its
charges then unpaid, the trustee ceasing to act shall, subject to
Section 11.4, pay over to the successor trustee all funds at the time
held by it under the Funding Note Indenture and shall execute and
deliver an instrument transferring to such successor trustee all such
rights, powers, duties and obligations. Upon request of any such
successor trustee, Global Funding shall execute any and all
instruments in writing for more fully and certainly vesting in and
confirming to such successor trustee all such rights and powers.
Subject to the Lien created under the Funding Note Indenture, any
trustee ceasing to act shall, nevertheless, retain a claim upon all
property or funds held or collected by such trustee to secure any
amounts then due it pursuant to the provisions of Section 6.6.
(b) Upon acceptance of appointment by a successor Funding Note Indenture
Trustee as provided in this Section 6.9, Global Funding shall notify
each Holder of the Funding Note and each rating agency then rating the
Funding Note at the request of Global Funding. If the acceptance of
appointment is substantially contemporaneous with the resignation,
then the notice called for by the preceding sentence may be combined
with the notice called for by Section 6.8. If Global Funding fails to
make such notice within 10 days after acceptance of appointment by the
successor Funding Note Indenture Trustee, the successor Funding Note
Indenture Trustee shall cause such notice to be mailed at the expense
of Global Funding.
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SECTION 6.10 Merger, Conversion, Consolidation or Succession to Business of
Funding Note Indenture Trustee.
(a) Any corporation or entity into which the Funding Note Indenture
Trustee may be merged or converted or with which it may be
consolidated, or any corporation or entity resulting from any merger,
conversion or consolidation to which the Funding Note Indenture
Trustee shall be a party, or any corporation or entity succeeding to
all or substantially all of the corporate trust business of the
Funding Note Indenture Trustee, shall be the successor of the Funding
Note Indenture Trustee under the Funding Note Indenture, provided that
such corporation or entity shall be eligible under the provisions of
Section 6.7, without the execution or filing of any paper or any
further act on the part of any of the parties to the Funding Note
Indenture, anything in the Funding Note Indenture to the contrary
notwithstanding.
(b) In case at the time such successor to the Funding Note Indenture
Trustee shall succeed to the trusts created by the Funding Note
Indenture the Funding Note shall have been authenticated but not
delivered, any such successor to the Funding Note Indenture Trustee
may adopt the certificate of authentication of any predecessor Funding
Note Indenture Trustee and deliver such Funding Note so authenticated;
and, in case at that time the Funding Note shall not have been
authenticated, any successor to the Funding Note Indenture Trustee may
authenticate such Funding Note either in the name of any predecessor
under the Funding Note Indenture or in the name of the successor
Funding Note Indenture Trustee; and in all such cases such certificate
shall have the full force; provided, that the right to adopt the
certificate of authentication of any predecessor Funding Note
Indenture Trustee or to authenticate the Funding Note in the name of
any predecessor Funding Note Indenture Trustee shall apply only to its
successor or successors by merger, conversion or consolidation.
SECTION 6.11 Limitations on Rights of Funding Note Indenture Trustee as
Creditor. The Funding Note Indenture Trustee shall comply with Section 311(a) of
the Trust Indenture Act.
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ARTICLE 7
HOLDERS' LISTS AND REPORTS BY FUNDING NOTE INDENTURE TRUSTEE AND GLOBAL
FUNDING
SECTION 7.1 Global Funding to Furnish Funding Note Indenture Trustee Names
and Addresses of Holders.
In accordance with Section 312(a) of the Trust Indenture Act, Global
Funding shall furnish or cause to be furnished to the Funding Note Indenture
Trustee:
(a) semi-annually not later than June 30 and December 31 of the year or
upon such other dates as are set forth in or pursuant to the Funding
Note Certificate or Supplemental Funding Note Indenture, a list, in
each case in such form as the Funding Note Indenture Trustee may
reasonably require, of the names and addresses of Holders as of the
applicable date, and
(b) at such other times as the Funding Note Indenture Trustee may request
in writing, within 30 days after the receipt by Global Funding of any
such request, a list of similar form and content as of a date not more
than 15 days prior to the time such list is furnished,
provided, however, that so long as the Funding Note Indenture Trustee is the
Funding Note Registrar no such list shall be required to be furnished.
SECTION 7.2 Preservation of Information; Communication to Holders.
The Funding Note Indenture Trustee shall comply with the obligations
imposed upon it pursuant to Section 312 of the Trust Indenture Act. Every Holder
of the Funding Note, by receiving and holding the same, agrees with Global
Funding and the Funding Note Indenture Trustee that neither Global Funding, the
Funding Note Indenture Trustee, any Funding Note Paying Agent or any Funding
Note Registrar shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Holders of the Funding Note in
accordance with Section 312(c) of the Trust Indenture Act, regardless of the
source from which such information was derived, and that the Funding Note
Indenture Trustee shall not be held accountable by reason of mailing any
material pursuant to a request made under Section 312(b) of the Trust Indenture
Act.
SECTION 7.3 Reports by Funding Note Indenture Trustee.
(a) Within 60 days after May 15 of each year commencing with the first May
15 following the issuance of the Funding Note, if required by Section
313(a) of the Trust Indenture Act, the Funding Note Indenture Trustee
shall transmit, pursuant to
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Section 313(c) of the Trust Indenture Act, a brief report dated as of
May 15 with respect to any of the events specified in Section 313(a)
of the Trust Indenture Act which may have occurred since the later of
the immediately preceding May 15 and the date of the Funding Note
Indenture.
(b) The Funding Note Indenture Trustee shall transmit the reports required
by Section 313(a) of the Trust Indenture Act at the time specified
therein.
(c) The Funding Note Indenture Trustee shall comply with Section 313(b) of
the Trust Indenture Act.
(d) Reports pursuant to this Section shall be transmitted in the manner
and to the Persons required by Sections 313(c) and 313(d) of the Trust
Indenture Act.
(e) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Funding Note Indenture Trustee with each
stock exchange upon which the Funding Note is listed, with the
Commission and Global Funding. Global Funding will notify the Funding
Note Indenture Trustee whether the Funding Note is listed on any stock
exchange.
(f) Within ten days following any distribution made or scheduled to be
made on the Funding Note, including any Interest Payment Date or the
Maturity Date, and only to the extent Global Funding is required to
file reports under the Exchange Act on its own behalf, the Funding
Note Indenture Trustee will deliver to the Funding Agreement Provider
and each Holder a report substantially in the form attached as Exhibit
C.
SECTION 7.4 Reports by Global Funding.
Pursuant to Section 314(a) of the Trust Indenture Act, Global Funding
shall:
(a) file, or cause to be filed, with the Funding Note Indenture Trustee,
within 15 days after Global Funding is required to file the same with
the Commission, copies of the annual reports and of the information,
documents and other reports (or copies of such portions of any of the
foregoing as the Commission may from time to time by rules and
regulations prescribe) which Global Funding may be required to file
with the Commission pursuant to Section 13 or Section 15(d) of the
Exchange Act; or,
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if Global Funding is not required to file information, documents or
reports pursuant to either of said Sections, then it shall file, or
cause to be filed, with the Funding Note Indenture Trustee and the
Commission, in accordance with rules and regulations prescribed from
time to time by the Commission, such of the supplementary and periodic
information, documents and reports which may be required pursuant to
Section 13 of the Exchange Act in respect of a security listed and
registered on a national securities exchange as may be prescribed form
time to time in such rules and regulations; provided that if, pursuant
to any publicly available interpretations of the Commission, Global
Funding would not be required to make such filings under Section
314(a) of the Trust Indenture Act, then Global Funding shall not be
required to make such filings;
(b) file, or cause to be filed on its behalf, with the Funding Note
Indenture Trustee and the Commission, in accordance with rules and
regulations prescribed from time to time by the Commission, such
additional information, documents and reports with respect to
compliance by Global Funding, with the conditions and covenants of the
Funding Note Indenture as may be required from time to time by such
rules and regulations; and
(c) transmit within 30 days after the filing thereof with the Funding Note
Indenture Trustee, in the manner and to the extent provided in Section
313(c) of the Trust Indenture Act, such summaries of any information,
documents and reports required to be filed by or on behalf of Global
Funding pursuant to paragraphs (a) and (b) of this Section as may be
required by rules and regulations prescribed from time to time by the
Commission.
SECTION 7.5 Reports on Assessment of Compliance with Servicing Criteria and
Compliance Statements; Attestation Reports of Registered Public Accounting Firm.
To the extent Global Funding is required to file reports under the Exchange Act
on its behalf, in connection with the filing of any Annual Report on Form 10-K
of Global Funding filed under the Exchange Act (each, an "Annual Report"), each
of the Funding Note Indenture Trustee and each Funding Note Paying Agent (unless
the Funding Note Indenture Trustee is the only Funding Note Paying Agent) shall
(a) provide to the Funding Agreement Provider and Global Funding (i) a report
required pursuant to Item 1122(a) of Regulation AB (17 CFR 229.1100 -
1123)("Regulation AB") on an assessment of compliance with the servicing
criteria set forth in Item 1122(d) of Regulation AB (each a "Compliance Report")
and (ii) a statement of compliance required pursuant to Item 1123 of Regulation
AB, each of which shall be dated the date of, and shall be filed as an exhibit
to, the applicable Annual Report; and (b) cause, at the expense of the Funding
Agreement Provider, a
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registered public accounting firm to provide to the Funding Agreement Provider
and Global Funding an attestation report on the applicable Compliance Report as
required pursuant to Item 1122(b) of Regulation AB, which shall be dated the
date of, and shall be filed as an exhibit to, the applicable Annual Report.
ARTICLE 8
CONCERNING EACH HOLDER
SECTION 8.1 Evidence of Action Taken by a Holder.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by the Funding Note Indenture to be given or
taken by any Holder may be embodied in and evidenced (i) by any
instrument or any number of instruments of similar tenor executed by
Holders in person or by agent or proxy appointed in writing, or (ii)
by the record of the Holders of the Funding Note voting in favor
thereof at any meeting of Holders duly called and held in accordance
with the provisions of Article 12, or (iii) by a combination of such
instrument or instruments and any such record of such meeting of
Holders. Except as otherwise expressly provided in the Funding Note
Indenture, such action shall become effective when such instrument or
instruments are delivered to the Funding Note Indenture Trustee. Proof
of execution of any instrument or of a writing appointing any such
agent shall be sufficient for any purpose of the Funding Note
Indenture and (subject to Sections 6.1 and 6.2) conclusive in favor of
the Funding Note Indenture Trustee and Global Funding, if made in the
manner provided in this Article. The record of any meeting of Holders
of the Funding Note shall be proved in the manner provided in Section
12.6.
(b) Any request, demand, authorization, direction, notice, consent, waiver
or other action of a Holder of the Funding Note shall bind every
future Holder of the same Funding Note and the Holder of every Funding
Note issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or
suffered to be done by the Funding Note Indenture Trustee or Global
Funding in reliance thereon, whether or not notation of such action is
made upon the Funding Note.
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SECTION 8.2 Proof of Execution of Instruments and of Holding of Funding
Note.
(a) Subject to Sections 6.1 and 6.2, the execution of any instrument by a
Holder or its agent or proxy may be proved in accordance with such
reasonable rules and regulations as may be prescribed by the Funding
Note Indenture Trustee or in such manner as shall be satisfactory to
the Funding Note Indenture Trustee.
(b) The ownership, principal amount and CUSIP number of the Funding Note
shall be proved by the Funding Note Register or by a certificate of
the Funding Note Indenture Trustee.
SECTION 8.3 Voting Record Date. Global Funding may set a record date for
purposes of determining the identity of each Holder of the Funding Note entitled
to vote or consent to any action referred to in Section 8.1, which record date
may be set at any time or from time to time by notice to the Funding Note
Indenture Trustee, for any date or dates (in the case of any adjournment or
resolicitation) not more than 60 days nor less than 5 days prior to the proposed
date of such vote or consent, and thereafter, notwithstanding any other
provisions of the Funding Note Indenture, only a Holder of the Funding Note on
such record date shall be entitled to so vote or give such consent or to
withdraw such vote or consent.
SECTION 8.4 Persons Deemed to be Owners. Global Funding, the Funding Note
Indenture Trustee and any agent of Global Funding or the Funding Note Indenture
Trustee may deem and treat the Holder of the Funding Note as the absolute owner
of the Funding Note (whether or not the Funding Note shall be overdue and
notwithstanding any notation of ownership or other writing on the Funding Note
Certificate) for the purpose of receiving payment of or on account of the
principal of, any premium on, and, subject to the provisions of the Funding Note
Indenture, any interest on, and any Additional Amounts with respect to, the
Funding Note and for all other purposes; and neither Global Funding nor the
Funding Note Indenture Trustee nor any agent of Global Funding or the Funding
Note Indenture Trustee shall be affected by any notice to the contrary. All such
payments so made to any such Person, or upon such Person's order, shall be
valid, and, to the extent of the sum or sums so paid, effectual to satisfy and
discharge the liability for funds payable upon the Funding Note.
SECTION 8.5 Right of Revocation of Action Taken; Binding Effect of Actions
by Holders.
(a) At any time prior to (but not after) the evidencing to the Funding
Note Indenture Trustee, as provided in Section 8.1, of the taking of
any action by the Holders of the percentage of the principal amount of
the Funding Note specified in the Funding Note Indenture in connection
with such action, any Holder of the
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Funding Note may, by filing written notice at the Corporate Trust
Office and upon proof of holding as provided in this Article, revoke
such action so far as concerns such Holder's interest in the Funding
Note.
(b) Any action taken by the Holders of the percentage of the principal
amount of the Funding Note specified in the Funding Note Indenture in
connection with such action shall be conclusively binding upon Global
Funding, the Funding Note Indenture Trustee and all present and future
Holders of the Funding Note, of the Funding Note issued in exchange
for the Funding Note or the Funding Note represented by the Funding
Note Certificate executed, authenticated and delivered in exchange for
the Funding Note Certificate representing the Funding Note,
irrespective of whether or not any notation in regard of any such
action is made on the applicable Funding Note Certificate.
ARTICLE 9
SUPPLEMENTAL FUNDING NOTE INDENTURES
SECTION 9.1 Supplemental Funding Note Indentures Without Consent of
Holders.
(a) Global Funding and the Funding Note Indenture Trustee may from time to
time and at any time enter into an indenture or indentures
supplemental to the Funding Note Indenture (each, a "Supplemental
Funding Note Indenture") (which shall conform to the provisions of the
Trust Indenture Act) for one or more of the following purposes without
the consent of any Holder:
(i) for Global Funding to convey, transfer, assign, mortgage or
pledge to the Funding Note Indenture Trustee as security for the
Funding Note any property or assets;
(ii) to add to the covenants of Global Funding such further covenants,
restrictions, conditions or provisions as Global Funding and the
Funding Note Indenture Trustee shall consider to be for the
protection of each Holder of the Funding Note, and to make the
occurrence, or the occurrence and continuance, of a default in
any such additional covenants, restrictions, conditions or
provisions an Event of Default permitting the enforcement of all
or any of the several remedies provided in the Funding Note
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Indenture as set forth in the Funding Note Indenture; provided,
that in respect of any such additional covenant, restriction,
condition or provision such Supplemental Funding Note Indenture
may provide for a particular period of grace after default (which
period may be shorter or longer than that allowed in the case of
other defaults) or may provide for an immediate enforcement upon
such an Event of Default or may limit the remedies available to
the Funding Note Indenture Trustee upon such an Event of Default
or may limit the right of the Holder Representative to waive such
an Event of Default;
(iii) to cure any ambiguity or to correct or supplement any provision
contained in the Funding Note Indenture or in any Supplemental
Funding Note Indenture or the Funding Note Certificate which may
be defective or inconsistent with any other provision contained
in the Funding Note Indenture or in any Supplemental Funding Note
Indenture or the Funding Note Certificate; or to make such other
provisions in regard to matters or questions arising under the
Funding Note Indenture or under any Supplemental Funding Note
Indenture or the Funding Note Certificate which shall not
adversely affect the interests of the Holders of the Funding Note
in any material respect; or
(iv) to evidence and provide for the acceptance of appointment under
the Funding Note Indenture by a successor trustee and to add to
or change any of the provisions of the Funding Note Indenture as
shall be necessary to provide for or facilitate the
administration of the trusts under the Funding Note Indenture by
more than one trustee.
(b) The Funding Note Indenture Trustee is authorized to join with Global
Funding in the execution of any such Supplemental Funding Note
Indenture, and to make any further appropriate agreements and
stipulations which may be therein contained, but the Funding Note
Indenture Trustee shall not be obligated to enter into any such
Supplemental Funding Note Indenture which affects the Funding Note
Indenture Trustee's own rights, duties or immunities under the Funding
Note Indenture or otherwise.
(c) Any Supplemental Funding Note Indenture authorized by the provisions
of this Section may be executed without the consent of
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any Holder of the Funding Note at the time outstanding,
notwithstanding any of the provisions of Section 9.2.
SECTION 9.2 Supplemental Funding Note Indentures with Consent of Holders.
(a) With the consent (evidenced as provided in Article 8) of the Holders
of not less than 66 2/3% of the outstanding principal amount of the
Funding Note, Global Funding and the Funding Note Indenture Trustee
may, from time to time and at any time, enter into a Supplemental
Funding Note Indenture for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of the
Funding Note Indenture or of any Supplemental Funding Note Indenture
or Funding Note Certificate or of modifying in any manner the rights
of the Holders of the Funding Note; provided, that no such
Supplemental Funding Note Indenture shall, without the consent of the
Holder of the Funding Note:
(i) change the final maturity of the Funding Note, or reduce the
principal amount thereof, or reduce the rate or extend the time
of payment of interest or any other amount payable thereon, or
impair or affect the right of any Holder to institute suit for
the payment thereof or modify any redemption or repayment
provisions applicable to the Funding Note;
(ii) permit the creation of any Lien on the Collateral or any part
thereof (other than the Security Interest) or terminate the
Security Interest as to any part of the Collateral, except as
permitted by the Funding Note Indenture; or
(iii) modify any of the provisions of this Section 9.2 except to
increase the aforementioned percentage of the Funding Note
required to approve any Supplemental Funding Note Indenture.
(b) Upon the request of Global Funding, and upon the filing with the
Funding Note Indenture Trustee of evidence of the consent of each
Holder and other documents, if any, required by Section 8.1 the
Funding Note Indenture Trustee shall join with Global Funding in the
execution of such Supplemental Funding Note Indenture unless such
Supplemental Funding Note Indenture affects the Funding Note Indenture
Trustee's own rights, duties or immunities under the Funding Note
Indenture or otherwise, in
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which case the Funding Note Indenture Trustee may in its discretion,
but shall not be obligated to, enter into such Supplemental Funding
Note Indenture.
(c) It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed Supplemental
Funding Note Indenture, but it shall be sufficient if such consent
shall approve the substance thereof.
(d) Promptly after the execution by Global Funding and the Funding Note
Indenture Trustee of any Supplemental Funding Note Indenture pursuant
to the provisions of this Section, the Funding Note Indenture Trustee
shall notify the Holders of the Funding Note, as provided in the
Funding Note Indenture, setting forth in general terms the substance
of such Supplemental Funding Note Indenture. Any failure of the
Funding Note Indenture Trustee to provide such notice, or any defect
therein, shall not, however, in any way impair or affect the validity
of any such Supplemental Funding Note Indenture.
SECTION 9.3 Compliance with Trust Indenture Act; Effect of Supplemental
Funding Note Indentures. Any Supplemental Funding Note Indenture executed
pursuant to the provisions of this Article shall comply with the Trust Indenture
Act. Upon the execution of any Supplemental Funding Note Indenture pursuant to
the provisions of the Funding Note Indenture, the Funding Note Indenture shall
be and be deemed to be modified and amended in accordance therewith and the
respective rights, limitations of rights, obligations, duties and immunities
under the Funding Note Indenture of the Funding Note Indenture Trustee, Global
Funding, each agent of Global Funding and each Holder of the Funding Note shall
thereafter be determined, exercised and enforced under the Funding Note
Indenture subject in all respects to such modifications and amendments, and all
the terms and conditions of any such Supplemental Funding Note Indenture shall
be and be deemed to be part of the terms and conditions of the Funding Note
Indenture for any and all purposes.
SECTION 9.4 Documents to Be Given to Funding Note Indenture Trustee. The
Funding Note Indenture Trustee, subject to the provisions of Sections 6.1 and
6.2, may receive a Trust Certificate and an Opinion of Counsel as conclusive
evidence that any such Supplemental Funding Note Indenture complies with the
applicable provisions of the Funding Note Indenture.
SECTION 9.5 Notation on Funding Note Certificate in Respect of Supplemental
Funding Note Indentures. The Funding Note Certificate may bear a notation in
form approved by the Funding Note Indenture Trustee as to any matter provided
for by any Supplemental Funding Note Indenture or as to any action taken at any
such meeting. If Global Funding or the Funding Note Indenture Trustee shall so
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determine, a new Funding Note Certificate representing the Funding Note so
modified as to conform, in the opinion of the Funding Note Indenture Trustee and
Global Funding, to any modification of the Funding Note Indenture contained in
any such Supplemental Funding Note Indenture may be prepared by Global Funding,
authenticated by the Funding Note Indenture Trustee and delivered in exchange
for the Funding Note Certificate then representing the Funding Note.
SECTION 9.6 Amendment to Funding Agreement(s).
(a) Global Funding and the Funding Note Indenture Trustee may from time to
time and at any time enter into or consent to one or more amendments
to any Funding Agreement for one or more of the following purposes
without the consent of any Holder: to cure any ambiguity or to correct
or supplement any provision contained in such Funding Agreement which
may be defective or inconsistent with any other provision contained in
such Funding Agreement, or with any provision of the Funding Note
Indenture, the Funding Note, the Notes, the Distribution Agreement,
the Trust Agreement, the Administrative Services Agreement, the
Coordination Agreement, the Name Licensing Agreement, the Support
Agreement, the Terms Agreement or the Pricing Supplement, or to make
such other provisions in regard to matters or questions arising under
such Funding Agreement or the Funding Note Indenture which shall not
adversely affect the interests of the Holders of the Funding Note in
any material respect.
(b) With the consent (evidenced as provided in Article 8) of the Holders
of not less than 66 2/3% of the outstanding principal amount of the
Funding Note, Global Funding and the Funding Note Indenture Trustee
may, from time to time and at any time, enter into or consent to one
or more amendments to any Funding Agreement for the purpose of adding
any provisions to or changing in any manner or eliminating any of the
provisions of such Funding Agreement; provided, that no such amendment
shall change the Maturity Date (as defined in such Funding Agreement)
of such Funding Agreement, or reduce the principal amount thereof, or
reduce the rate or extend the time of payment of interest or any other
amount payable thereon, or impair or affect the right of the Funding
Note Indenture Trustee or Global Funding to institute suit for the
payment thereof or modify any redemption or repayment provisions
applicable to such Funding Agreement without the consent of the Holder
of any Funding Note affected thereby.
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(c) The Funding Note Indenture Trustee may receive and conclusively rely
upon an Opinion of Counsel stating whether or not the Funding Note
would be affected by any amendment of a Funding Agreement and any such
Opinion of Counsel shall be conclusive upon all the Holders of the
Funding Note.
(d) Notwithstanding any other provision, Global Funding and the Funding
Note Indenture Trustee will not enter into or consent to any amendment
to any Funding Agreement with the Funding Agreement Provider or permit
any Funding Agreement to be amended or modified if such amendment or
modification would cause Global Funding not to be ignored or treated
as a "grantor trust" for United States federal income tax purposes (as
evidenced by an Opinion of Counsel). Furthermore, Global Funding and
the Funding Note Indenture Trustee will not enter into or consent to
any agreement or take any action which would cause Global Funding to
become required to be registered as an "investment company", or come
under the "control" of an "investment company," as such terms are
defined in the Investment Company Act.
(e) The Funding Note Indenture Trustee, subject to the provisions of
Sections 6.1 and 6.2, may receive an Opinion of Counsel as conclusive
evidence that any such amendment to a Funding Agreement complies with
the requirements of Section 9.6(a) or (b), as applicable, and any such
Opinion of Counsel shall be conclusive on the Holders of the Funding
Note.
(f) It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment to a
Funding Agreement, but it shall be sufficient if such consent shall
approve the substance thereof.
ARTICLE 10
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 10.1 Global Funding May Merge, Consolidate, Sell or Convey Property
Under Certain Circumstances. Global Funding may not consolidate with, or merge
into, any entity (whether or not affiliated with Global Funding), or sell, lease
or convey the property of Global Funding as an entirety or substantially as an
entirety, unless:
(a) the entity formed by such consolidation or into which Global Funding
is merged or the entity which acquires by conveyance or transfer the
properties and assets of Global Funding substantially
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as an entirety shall be a statutory trust formed under the laws of the
State of Delaware or a corporation or other entity organized and
existing under the laws of the United States of America or any State
or the District of Columbia, and shall expressly assume, by a
Supplemental Funding Note Indenture, executed and delivered to the
Funding Note Indenture Trustee, in form satisfactory to the Funding
Note Indenture Trustee, the due and punctual payment of the principal
of, any premium and interest on, and any Additional Amounts with
respect to, the Funding Note and the performance of every covenant of
the Funding Note Indenture on the part of Global Funding to be
performed or observed;
(b) immediately after giving effect to such transaction, no Event of
Default, and no event which, after notice or lapse of time, or both,
would become an Event of Default, shall have happened and be
continuing;
(c) Global Funding has received written confirmation from any rating
agency then rating the Funding Note at the request of Global Funding
that such consolidation, merger, conveyance or transfer shall not
cause the rating on the then outstanding Funding Note to be downgraded
or withdrawn; and
(d) Global Funding has delivered to the Funding Note Indenture Trustee a
Trust Certificate and an Opinion of Counsel each stating that such
consolidation, merger, conveyance or transfer and such Supplemental
Funding Note Indenture comply with this Article and that all
conditions precedent provided for in the Funding Note Indenture
relating to such transaction have been complied with.
ARTICLE 11
SATISFACTION AND DISCHARGE OF FUNDING NOTE INDENTURE; UNCLAIMED FUNDS
SECTION 11.1 Satisfaction and Discharge of Funding Note Indenture. If at
any time (a) Global Funding shall have paid or caused to be paid all outstanding
principal of, any premium and interest on, and any Additional Amounts and other
amounts payable with respect to, the Funding Note, as and when the same shall
have become due and payable, or (b) Global Funding shall have delivered to the
Funding Note Indenture Trustee for cancellation the Funding Note Certificate
representing the Funding Note theretofore authenticated (other than the Funding
Note Certificate which shall have been destroyed, lost or stolen and which shall
have been replaced or paid as provided in Section 2.7) or (c) Global Funding
shall have irrevocably deposited or caused to be deposited with the Funding Note
Indenture Trustee as trust funds the entire
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amount in cash (other than funds repaid by the Funding Note Indenture Trustee or
any Funding Note Paying Agent to Global Funding in accordance with Section 11.4)
sufficient to pay at maturity all amounts payable at maturity on the Funding
Note, including any outstanding principal, interest, premium, Additional Amounts
and other amounts due or to become due to such date of maturity as the case may
be, and if, in any such case, Global Funding shall also pay or cause to be paid
all other sums payable under the Funding Note Indenture by Global Funding, then
the Funding Note Indenture shall cease to be of further effect (except as to (i)
rights of registration of transfer and exchange, (ii) substitution of an
apparently mutilated, defaced, destroyed, lost or stolen Funding Note
Certificate, (iii) rights of Holders to receive payments of principal of, any
premium and interest on, and any Additional Amounts and other amounts payable
with respect to, the Funding Note, (iv) the rights, obligations and immunities
of the Funding Note Indenture Trustee under the Funding Note Indenture and (v)
the rights of each Holder as beneficiary of the Funding Note Indenture with
respect to the property so deposited with the Funding Note Indenture Trustee
payable to all or any of them), and the Funding Note Indenture Trustee, on
demand of Global Funding accompanied by a Trust Certificate and an Opinion of
Counsel and at the cost and expense of Global Funding, shall execute proper
instruments acknowledging such satisfaction of and discharging the Funding Note
Indenture. Global Funding agrees to reimburse the Funding Note Indenture Trustee
for any costs or expenses thereafter reasonably and properly incurred and to
compensate the Funding Note Indenture Trustee for any services thereafter
reasonably and properly rendered by the Funding Note Indenture Trustee in
connection with the Funding Note Indenture or the Funding Note.
SECTION 11.2 Application by Funding Note Indenture Trustee of Funds
Deposited for Payment of Funding Note. Subject to Section 11.4, all funds
deposited with the Funding Note Indenture Trustee pursuant to Section 11.1 shall
be held in trust in the Collection Account in accordance with Section 6.5 and
applied by it to the payment, either directly, in its capacity as the Funding
Note Paying Agent, or through any other Funding Note Paying Agent, to each
Holder of the Funding Note for the payment or redemption of which such funds
have been deposited with the Funding Note Indenture Trustee, of all sums due and
to become due thereon for any principal, interest, premium, Additional Amounts
or other amounts.
SECTION 11.3 Repayment of Funds Held by Funding Note Paying Agent. In
connection with the satisfaction and discharge of the Funding Note Indenture,
all funds then held by any Funding Note Paying Agent under the provisions of the
Funding Note Indenture shall, upon demand of Global Funding, be repaid to Global
Funding or paid to the Funding Note Indenture Trustee and thereupon such Funding
Note Paying Agent shall be released from all further liability with respect to
such funds.
SECTION 11.4 Return of Funds Held by Funding Note Indenture Trustee and
Funding Note Paying Agent. Any funds deposited with or paid to the Funding Note
Indenture Trustee or any Funding Note Paying Agent for the payment of the
principal of, any interest or premium on, or any Additional Amounts or any other
amounts with
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respect to, the Funding Note and not applied but remaining unclaimed for three
years after the date upon which such principal, interest, premium, Additional
Amounts or any other amount shall have become due and payable, shall, upon the
written request of Global Funding and unless otherwise required by mandatory
provisions of applicable escheat or abandoned or unclaimed property law, be
repaid to Global Funding by the Funding Note Indenture Trustee or such Funding
Note Paying Agent, and each Holder of the Funding Note shall, unless otherwise
required by mandatory provisions of applicable escheat or abandoned or unclaimed
property laws, thereafter look only to Global Funding for any payment which such
Holder may be entitled to collect, and all liability of the Funding Note
Indenture Trustee or any Funding Note Paying Agent with respect to such funds
shall thereupon cease.
ARTICLE 12
MEETINGS OF HOLDERS OF FUNDING NOTE
SECTION 12.1 Purposes for Which Meetings May Be Called. A meeting of
Holders of the Funding Note may be called at any time and from time to time
pursuant to this Article to make, give or take any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
the Funding Note Indenture to be made, given or taken by Holders of the Funding
Note.
SECTION 12.2 Call, Notice and Place of Meetings.
(a) Unless otherwise provided in the Funding Note Certificate, the Funding
Note Indenture Trustee may at any time call a meeting of Holders of
the Funding Note for any purpose specified in Section 12.1, to be held
at such time and at such place in the City of New York or the city in
which the Corporate Trust Office is located. Notice of every meeting
of Holders of the Funding Note, setting forth the time and the place
of such meeting and in general terms the action proposed to be taken
at such meeting, shall be given in the manner provided in Section
13.4, not less than 21 nor more than 180 days prior to the date fixed
for the meeting.
(b) In case at any time Global Funding or the Holder or Holders of at
least 10% of the principal amount of the Funding Note shall have
requested the Funding Note Indenture Trustee to call a meeting of the
Holders of the Funding Note for any purpose specified in Section 12.1,
by written request setting forth in reasonable detail the action
proposed to be taken at the meeting, and the Funding Note Indenture
Trustee shall not have made the first publication or mailing of the
notice of such meeting within 21 days after receipt of such request or
shall not thereafter proceed to cause the meeting to be held as
provided in the Funding Note Indenture,
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then Global Funding or the Holder or Holders of the Funding Note in
the amount above specified, as the case may be, may determine the time
and the place in the City of New York or the city in which the
Corporate Trust Office is located for such meeting and may call such
meeting for such purposes by giving notice thereof as provided in
Section 12.2.
SECTION 12.3 Persons Entitled to Vote at Meetings. To be entitled to vote
at any meeting of Holders of the Funding Note, a Person shall be (a) a Holder of
the Funding Note, or (b) a Person appointed by an instrument in writing as proxy
for a Holder or Holders of the Funding Note by such Holder or Holders. The only
Persons who shall be entitled to be present or to speak at any meeting of
Holders of the Funding Note shall be the Persons entitled to vote at such
meeting and their counsel, any representatives of the Funding Note Indenture
Trustee and its counsel and any representatives of Global Funding and its
counsel.
SECTION 12.4 Quorum; Action.
(a) The Persons entitled to vote a majority in principal amount of the
Funding Note then outstanding shall constitute a quorum for a meeting
of Holders of the Funding Note; provided, however, that if any action
is to be taken at such meeting with respect to a consent or waiver
which the Funding Note Indenture expressly provides may be given by
the Holders of not less than 66 2/3% of the outstanding principal
amount of the Funding Note, then Persons entitled to vote 66 2/3% of
the outstanding principal amount of the Funding Note shall constitute
a quorum. In the absence of a quorum within 30 minutes after the time
appointed for any such meeting, the meeting shall, if convened at the
request of Holders of the Funding Note, be dissolved. In any other
case the meeting may be adjourned for a period of not less than 10
days as determined by the chairman of the meeting prior to the
adjournment of such meeting. In the absence of a quorum at any such
adjourned meeting, such adjourned meeting may be further adjourned for
a period of not less than 10 days as determined by the chairman of the
meeting prior to the adjournment of such adjourned meeting. Notice of
the reconvening of any adjourned meeting shall be given as provided in
Section 12.2, except that such notice need be given only once not less
than five days prior to the date on which the meeting is scheduled to
be reconvened. Notice of the reconvening of an adjourned meeting shall
state expressly the percentage, as provided above, of the principal
amount of the outstanding Funding Note which shall constitute a
quorum.
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(b) Except as limited by the proviso to Section 9.2(a), any resolution
presented to a meeting or adjourned meeting duly reconvened at which a
quorum is present as aforesaid may be adopted only by the affirmative
vote of the Holders of a majority of the outstanding principal amount
of the Funding Note; provided, however, that, except as limited by the
proviso to Section 9.2(a), any resolution with respect to any consent
or waiver which the Funding Note Indenture expressly provides may be
given by the Holders of not less than 66 2/3% of the outstanding
principal amount of the Funding Note may be adopted at a meeting or an
adjourned meeting duly convened and at which a quorum is present as
aforesaid only by the affirmative vote of the Holders of 66 2/3% of
the outstanding principal amount of the Funding Note; and provided,
further, that, except as limited by the proviso to Section 9.2(a), any
resolution with respect to any request, demand, authorization,
direction, notice, consent, waiver or other action which the Funding
Note Indenture expressly provides may be made, given or taken by the
Holders of a specified percentage, which is less than a majority, of
the outstanding principal amount of the Funding Note may be adopted at
a meeting or an adjourned meeting duly reconvened and at which a
quorum is present as aforesaid by the affirmative vote of the Holders
of such specified percentage of the outstanding principal amount of
the Funding Note.
(c) Any resolution passed or decision taken at any meeting of Holders of
the Funding Note duly held in accordance with this Section shall be
binding on all the Holders of Funding Note, whether or not such
Holders were present or represented at the meeting.
SECTION 12.5 Determination of Voting Rights; Conduct of Adjournment of
Meetings.
(a) Notwithstanding any other provisions of the Funding Note Indenture,
the Funding Note Indenture Trustee may make such reasonable
regulations as it may deem advisable for any meeting of Holders of the
Funding Note in regard to proof of the holding of the Funding Note and
of the appointment of proxies and in regard to the appointment and
duties of inspectors of votes, the submission and examination of
proxies, certificates and other evidence of the right to vote, and
such other matters concerning the conduct of the meeting as it shall
deem appropriate. Except as otherwise permitted or required by any
such regulations, the holding of the Funding Note shall be proved in
the manner
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specified in Section 8.4 and the appointment of any proxy shall be
proved in the manner specified in Section 8.2. Such regulations may
provide that written instruments appointing proxies, regular on their
face, may be presumed valid and genuine without the proof specified in
Section 8.2 or other proof.
(b) The Funding Note Indenture Trustee shall, by an instrument in writing,
appoint a temporary chairman of the meeting, unless the meeting shall
have been called by Global Funding or by Holders of the Funding Note
as provided in Section 12.2(b), in which case Global Funding or the
Holders of the Funding Note calling the meeting, as the case may be,
shall in like manner appoint a temporary chairman. A permanent
chairman and a permanent secretary of the meeting shall be elected by
vote of the Persons entitled to vote a majority of the outstanding
principal amount of the Funding Note represented at the meeting.
(c) At any meeting, each Holder of the Funding Note or proxy shall be
entitled to one vote for each $1,000 of principal amount of the
Funding Note held or represented by such Holder or proxy. The chairman
of the meeting shall have no right to vote, except as a Holder of the
Funding Note or proxy.
(d) Any meeting of Holders of the Funding Note duly called pursuant to
Section 12.2 at which a quorum is present may be adjourned from time
to time by Persons entitled to vote a majority of the outstanding
principal amount of the Funding Note represented at the meeting; and
the meeting may be held as so adjourned without further notice.
SECTION 12.6 Counting Votes and Recording Action of Meetings. The vote upon
any resolution submitted to any meeting of Holders of the Funding Note shall be
(a) by written ballots on which shall be subscribed the signatures of the
Holders of the Funding Note or of their representatives by proxy and the
principal amounts and serial numbers of the outstanding Funding Note held or
represented by them or (b) by such other procedures adopted by the Funding Note
Indenture Trustee in its discretion. The permanent chairman of the meeting shall
appoint two inspectors of votes who shall count all votes cast at the meeting
for or against any resolution and who shall make and file with the secretary of
the meeting their verified written reports in triplicate of all votes cast at
the meeting. A record, at least in triplicate, of the proceedings of each
meeting of Holders of the Funding Note shall be prepared by the secretary of the
meeting and there shall be attached to said record the original reports of the
inspectors of votes on any vote by ballot taken thereat and affidavits by one or
more persons having knowledge of the facts setting forth a copy of the notice of
the meeting and showing that said notice was given as provided in Section 12.2
and, if applicable,
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Section 12.4. Each copy shall be signed and verified by the affidavits of the
permanent chairman and secretary of the meeting and one such copy shall be
delivered to Global Funding, and another to the Funding Note Indenture Trustee
to be preserved by the Funding Note Indenture Trustee, the latter to have
attached thereto the ballots voted at the meeting. Any record so signed and
verified shall be conclusive evidence of the matters therein stated.
ARTICLE 13
MISCELLANEOUS PROVISIONS
SECTION 13.1 No Recourse. Notwithstanding anything to the contrary
contained in the Funding Note Indenture, or the Funding Note Certificate or
Supplemental Funding Note Indenture, none of the Funding Agreement Provider, its
officers, directors, affiliates, employees or agents, or any of the Delaware
Trustee, the Funding Note Indenture Trustee or the Global Funding Trust
Beneficial Owner, or any of their officers, directors, affiliates, employees or
agents (the "Nonrecourse Parties") will be personally liable for the payment of
any principal, interest or any other sums at any time owing under the terms of
the Funding Note. If any Event of Default shall occur with respect to the
Funding Note, the right of the Holders of the Funding Note and the Funding Note
Indenture Trustee on behalf of such Holders in connection with a claim on the
Funding Note shall be limited solely to a proceeding against the Collateral.
Neither the Holders nor the Funding Note Indenture Trustee on behalf of the
Holders will have the right to proceed against the Nonrecourse Parties to
enforce the Funding Note (except that to the extent they exercise their rights,
if any, to seize the relevant Funding Agreement(s), they may enforce the
relevant Funding Agreement(s) against the Funding Agreement Provider) or for any
deficiency judgment remaining after foreclosure of any property included in the
relevant Collateral.
It is expressly understood and agreed that nothing contained in this
Section shall in any manner or way constitute or be deemed a release of the debt
or other obligations evidenced by the Funding Note or otherwise affect or impair
the enforceability against Global Funding of the liens, assignments, rights and
the Security Interest created by or pursuant to the Funding Note Indenture, the
relevant Collateral or any other instrument or agreement evidencing, securing or
relating to the indebtedness or the obligations evidenced by the Funding Note.
Nothing in this Section shall preclude the Holders from foreclosing upon any
property included in the Collateral or any other rights or remedies in law or in
equity against Global Funding.
SECTION 13.2 Provisions of Funding Note Indenture for the Sole Benefit of
Parties and Holders. Nothing in the Funding Note Indenture or in the Funding
Note, expressed or implied, shall give or be construed to give to any Person,
other than the parties to the Funding Note Indenture and their successors and
the Holders of the Funding Note, any legal or equitable right, remedy or claim
under the Funding Note Indenture or under any covenant or provision contained in
the Funding Note Indenture,
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all such covenants and provisions being for the sole benefit of the parties to
the Funding Note Indenture and their successors and of the Holders of the
Funding Note.
SECTION 13.3 Successors and Assigns of Global Funding Bound by Indenture.
All the covenants, stipulations, promises and agreements in the Funding Note
Indenture contained by or in behalf of Global Funding shall bind its successors
and assigns, whether so expressed or not.
SECTION 13.4 Notices and Demands on Global Funding, Funding Note Indenture
Trustee and any Holder.
(a) Except as otherwise provided by this Section, any notice or demand
which by any provision of the Funding Note Indenture is required or
permitted to be given or served by the Funding Note Indenture Trustee
or by any Holder of the Funding Note to or on Global Funding may be
given or served by being deposited postage prepaid, first-class mail
(except as otherwise specifically provided in the Funding Note
Indenture) addressed (until another address of Global Funding is filed
by Global Funding with the Funding Note Indenture Trustee) to the
Delaware Trustee. Any notice, direction, request or demand by Global
Funding or any Holder to or upon the Funding Note Indenture Trustee
shall be deemed to have been sufficiently given or made, for all
purposes, if given or made at the Corporate Trust Office.
(b) Where the Funding Note Indenture provides for notice to any Holder,
such notice shall be sufficiently given (unless otherwise expressly
provided in the Funding Note Indenture) if in writing and mailed,
first-class postage prepaid, to each Holder entitled thereto, at such
Holder's last address as it appears in the Note Register. In any case
where notice to any Holder is given by mail, neither the failure to
mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with
respect to any other Holder.
(c) Where the Funding Note Indenture provides for notice in any manner,
such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall
be the equivalent of such notice. Waivers of notice by any Holder
shall be filed with the Funding Note Indenture Trustee, but such
filing shall not be a condition precedent to the validity of any
action taken in reliance upon such waiver.
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(d) If, by reason of the suspension of or irregularities in regular mail
service, it shall be impracticable to mail notice to Global Funding
and each Holder when such notice is required to be given pursuant to
any provision of the Funding Note Indenture, then any manner of giving
such notice as shall be satisfactory to the Funding Note Indenture
Trustee shall be deemed to be a sufficient giving of such notice.
(e) Global Funding shall deliver promptly to each rating agency then
rating the Funding Note copies of each of the following:
(i) any repurchase of the Funding Note or any portion thereof
pursuant to Section 3.3;
(ii) any notice of any default or Event of Default;
(iii) any notice of redemption provided by Global Funding pursuant to
Section 3.1(d);
(iv) any notice of change in name, identity, organizational structure,
chief executive office, or chief place of business of Global
Funding provided by Global Funding pursuant to Section 14.4(a);
(v) any Supplemental Funding Note Indenture;
(vi) any resignation, removal or appointment under the Funding Note
Indenture;
(vii) any amendment to any Funding Agreement; and
(viii) any other information reasonably requested by such rating
agency.
Any such notice shall be addressed to:
Standard & Poor's Ratings Services,
a division of The McGraw-Hill Companies, Inc.
55 Water Street
New York, NY 10041
Attention: Capital Markets
Facsimile: (212) 438-5215
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Moody's Investors Service Inc.
99 Church Street
New York, NY 10007
Attention: Life Insurance Group
Facsimile: (212) 553-4805
or such other address previously furnished in writing to Global Funding
by the applicable rating agency.
SECTION 13.5 Trust Certificates and Opinions of Counsel; Statements to be
Contained Therein.
(a) Except as otherwise expressly provided in the Funding Note Indenture,
upon any application or demand by Global Funding to the Funding Note
Indenture Trustee to take any action under any of the provisions of
the Funding Note Indenture, Global Funding shall furnish to the
Funding Note Indenture Trustee a Trust Certificate stating that all
conditions precedent, if any, provided for in the Funding Note
Indenture relating to the proposed action have been complied with and
an Opinion of Counsel stating that in the opinion of the applicable
counsel all such conditions precedent, if any, have been complied
with, except that in the case of any such application or demand as to
which the furnishing of such documents is specifically required by any
provision of the Funding Note Indenture relating to such particular
application or demand, no additional certificate or opinion need be
furnished.
(b) Each certificate or opinion provided for in the Funding Note Indenture
and delivered to the Funding Note Indenture Trustee with respect to
compliance with a condition or covenant provided for in the Funding
Note Indenture shall include:
(i) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(ii) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained
in such certificate or opinion are based;
(iii) a statement that, in the opinion of such Person, he has made
such examination or investigation or has received such
certificates, opinions, representations or statements of counsel
or accountants pursuant to paragraphs (c) or
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(d) of this Section, as are necessary to enable him to express an
informed opinion as to whether or not such covenant or condition
has been complied with; and
(iv) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been complied with.
(c) Any certificate, statement or opinion of Global Funding may be based
upon a certificate or opinion of or representations by counsel, unless
Global Funding knows that the certificate or opinion or
representations with respect to the matters upon which his
certificate, statement or opinion may be based as aforesaid are
erroneous, or in the exercise of reasonable care should know that the
same are erroneous. Any certificate, statement or opinion of counsel
may be based, insofar as it relates to factual matters information
with respect to which is in the possession of Global Funding, upon the
certificate, statement or opinion of or representations by Global
Funding, unless such counsel knows that the certificate, statement or
opinion or representations with respect to the matters upon which the
certificate, statement or opinion may be based as aforesaid are
erroneous, or in the exercise of reasonable care should know that the
same are erroneous.
(d) Any certificate, statement or opinion of Global Funding or of counsel
may be based, insofar as it relates to accounting matters, upon a
certificate or opinion of or representations by an accountant or firm
of accountants in the employ of Global Funding, unless such officer or
counsel, as the case may be, knows that the certificate or opinion or
representations with respect to the accounting matters upon which the
certificate, statement or opinion may be based as aforesaid are
erroneous, or in the exercise of reasonable care should know that the
same are erroneous.
(e) Any certificate or opinion of any independent firm of public
accountants filed with the Funding Note Indenture Trustee shall
contain a statement that such firm is independent.
SECTION 13.6 Governing Law. Pursuant to Section 5-1401 of the General
Obligations Law of the State of New York, the Funding Note Indenture and the
Funding Note shall (unless specified otherwise in the Funding Note Certificate)
be governed by, and construed in accordance with, the laws of the State of New
York, except as required by mandatory provisions of law and except to the extent
that the validity or perfection
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of Global Funding's ownership of and security interest in the Funding
Agreement(s) or remedies under the Funding Note Indenture in respect thereof may
be governed by the laws of a jurisdiction other than the State of New York. All
judicial proceedings brought against Global Funding or the Funding Note
Indenture Trustee arising out of or relating to the Funding Note Indenture, the
Funding Note or any portion of the Collateral or other assets of Global Funding
may be brought in any state or Federal court in the State of New York, provided
that the Funding Note Certificate may specify other jurisdictions as to which
Global Funding may consent to the nonexclusive jurisdiction of its courts with
respect to the Funding Note.
SECTION 13.7 Counterparts. The Funding Note Indenture 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.
SECTION 13.8 Trust Indenture Act to Control. If and to the extent that any
provision of the Funding Note Indenture limits, qualifies or conflicts with any
duties under any required provision of the Trust Indenture Act imposed on the
Funding Note Indenture by Section 318(c) of the Trust Indenture Act, such
provision of the Trust Indenture Act shall control.
SECTION 13.9 Judgment Currency. Global Funding will indemnify the Holder of
the Funding Note against any judgment or order being given or made for any
amount due under such Funding Note and that judgment or order requiring payment
in a currency (the "Judgment Currency") other than the Specified Currency, and
as a result of any variation between:
(a) the rate of exchange at which the Specified Currency amount is
converted into the Judgment Currency for the purpose of that judgment
or order; and
(b) the rate of exchange at which the Holder, on the date of payment of
that judgment or order, is able to purchase the Specified Currency
with the amount of the Judgment Currency actually received.
ARTICLE 14
SECURITY INTEREST
SECTION 14.1 Security Interest.
(a) To secure the full and punctual payment of the Obligations in
accordance with the terms of the Funding Note Indenture and to secure
the performance of Global Funding's obligations under the Funding Note
and the Funding Note Indenture, Global Funding pledges and
collaterally assigns to and with the Funding Note
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Indenture Trustee for the benefit of each Holder of the Funding Note
and any other Person for whose benefit the Funding Note Indenture
Trustee is or will be holding the Collateral (the "Secured Parties"),
and grants to the Funding Note Indenture Trustee for the benefit of
each Secured Party, a security interest in the Collateral, and all of
the rights and privileges of Global Funding in and to the Collateral
(the "Security Interest"), effective as of the Original Issue Date of
the Funding Note.
(b) It is expressly agreed that anything therein contained to the contrary
notwithstanding, Global Funding shall remain liable under each Funding
Agreement to perform all the obligations assumed by it thereunder, all
in accordance with and pursuant to the terms and provisions thereof,
and the Funding Note Indenture Trustee shall not have any obligations
or liabilities by reason of or arising out of the Funding Note
Indenture, nor shall the Funding Note Indenture Trustee be required or
obligated in any manner to perform or fulfill any obligations of
Global Funding under or pursuant to such Funding Agreement or to make
any payment, to make any inquiry as to the nature or sufficiency of
any payment received by it, or, prior to the occurrence and
continuance of an Event of Default, to present or file any claim, or
to take any action to collect or enforce the payment of any amounts
that may have been assigned to it or to which it may be entitled at
any time or times.
(c) The Funding Note Indenture Trustee acknowledges the grant of the
Security Interest upon the issuance of the Funding Note, accepts the
trusts under the Funding Note Indenture in accordance with the
provisions of the Funding Note Indenture and agrees to perform its
duties in the Funding Note Indenture to the end that the interests of
each Secured Party may be adequately and effectively protected.
SECTION 14.2 Representations and Warranties. Global Funding represents and
warrants as of the date of the Funding Note Indenture as follows:
(a) Global Funding owns each Funding Agreement that secures the
Obligations and all of the rest of the Collateral, free and clear of
any Liens other than the Security Interest in the Collateral.
(b) Global Funding has not performed any acts which might prevent the
Funding Note Indenture Trustee from enforcing any of the terms of the
Funding Note Indenture or which would limit the Funding Note Indenture
Trustee in any such enforcement. Other
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than financing statements or other similar or equivalent documents or
instruments with respect to the Security Interest, no financing
statement, mortgage, security agreement or similar or equivalent
document or instrument covering all or any part of the Collateral is
on file or of record in any jurisdiction in which such filing or
recording would be effective to perfect a Lien on such Collateral. No
Collateral is in the possession of any Person (other than Global
Funding or its agent) asserting any claim thereto or security interest
therein, except that the Funding Note Indenture Trustee or its
designee may have possession of Collateral as contemplated by the
Funding Note Indenture.
(c) Each Security Interest constitutes a valid security interest securing
the Obligations. When (i) the financing statements shall have been
filed in the appropriate offices in Illinois, Delaware and New York,
(ii) the Funding Note Indenture Trustee or its agent shall have taken
possession of each applicable Funding Agreement, (iii) Global Funding
shall have pledged and collaterally assigned each applicable Funding
Agreement to the Funding Note Indenture Trustee and given written
notice to the Funding Agreement Provider of each such assignment to
the Funding Note Indenture Trustee and (iv) the Funding Agreement
Provider shall have given its express written consent to such pledge
and collateral assignment and affirmed in writing that the Funding
Agreement Provider has changed its books and records to reflect such
pledge and collateral assignment to the Funding Note Indenture
Trustee, such Security Interest shall constitute a first priority
perfected security interest in the Collateral, enforceable against
Global Funding, Global Funding's creditors and any purchaser from
Global Funding.
SECTION 14.3 Additional Representations and Warranties. Global Funding
represents and warrants as of the date of the Funding Note Indenture that:
(a) to the extent the creation of a security interest in any Funding
Agreement is governed by the applicable UCC, the Funding Note
Indenture creates a valid security interest (as defined in the
applicable UCC) in each Funding Agreement in favor of the Funding Note
Indenture Trustee for the benefit and security of the Secured Parties,
which security interest is prior to all other Liens;
(b) to the extent the UCC applies, each Funding Agreement consists of
"general intangibles," "payment intangibles" and/or "instruments"
within the meaning of the applicable UCC;
85
(c) subject to the grant of security interest, pledge and collateral
assignment of Global Funding's estate, right, title and interest in
each Funding Agreement, Global Funding is a party to and is the Person
entitled to payment under each Funding Agreement on the date of the
Funding Note Indenture free and clear of any Lien, claim or
encumbrance of any Person, other then the Lien created under the
Funding Note Indenture or any Lien otherwise permitted under the
Funding Note Indenture;
(d) to the extent the UCC applies, Global Funding has caused or will have
caused, within ten days after the date of the Funding Note Indenture,
the filing of all appropriate financing statements in the proper
filing office in the appropriate jurisdictions under applicable law in
order to perfect the security interest in each Funding Agreement
granted to the Funding Note Indenture Trustee for the benefit and
security of the Secured Parties under the Funding Note Indenture;
(e) all original executed copies of each instrument that constitutes or
evidences each Funding Agreement have been delivered to the Funding
Note Indenture Trustee or a custodian for the Funding Note Indenture
Trustee (the "Custodian");
(f) where all original executed copies of each instrument that constitutes
or evidences each Funding Agreement have been delivered to the
Custodian, Global Funding has received a written acknowledgment from
the Custodian that, for so long as the Security Interest has not been
terminated pursuant to Section 14.9, the Custodian is holding the
instruments that constitute or evidence each Funding Agreement solely
on behalf of the Funding Note Indenture Trustee;
(g) other than the security interest granted to the Funding Note Indenture
Trustee for the benefit and security of the Secured Parties pursuant
to the Funding Note Indenture, Global Funding has not pledged,
assigned, sold, granted a security interest in, or otherwise conveyed
any of the Funding Agreements;
(h) Global Funding has not authorized the filing of and is not aware of
any financing statements against Global Funding that include a
description of collateral covering the Funding Agreement other than
any financing statement relating to the security interest granted to
the Funding Note Indenture Trustee for the benefit and security of the
Secured Parties under the Funding Note Indenture or that has been
terminated;
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(i) Global Funding is not aware of any judgment or tax lien filings
against Global Funding; and
(j) none of the instruments that constitute or evidence any Funding
Agreement has any marks or notations indicating that they have been
pledged, assigned or otherwise conveyed to any Person other than the
Funding Note Indenture Trustee for the benefit and security of the
Secured Parties.
The foregoing representations and warranties shall survive the execution
and delivery of the Funding Note. No party to the Funding Note Indenture shall
waive any of the foregoing representations and warranties. Subject to Section
14.9, Global Funding shall maintain the perfection and priority of the security
interest in each Funding Agreement.
SECTION 14.4 Further Assurances; Covenants.
(a) Global Funding will not change its name, identity or organizational
structure in any manner unless it shall have given the Funding Note
Indenture Trustee at least 30 days' prior notice thereof. Global
Funding will not change the location of its chief executive office or
chief place of business unless it shall have given the Funding Note
Indenture Trustee at least 30 days' prior notice thereof.
(b) Global Funding will, from time to time and upon advice of counsel, at
Global Funding's expense, execute, deliver, file and record any
statement, assignment, instrument, document, agreement or other paper
and take any other action, (including, without limitation, any filings
of financing or continuation statements) that from time to time may be
necessary or desirable, or that the Funding Note Indenture Trustee may
reasonably request, in order to create, preserve, perfect, confirm or
validate the Security Interest or to enable the Holders of the Funding
Note to obtain the full benefits of the Funding Note Indenture, or to
enable the Funding Note Indenture Trustee to exercise and enforce any
of its rights, powers and remedies under the Funding Note Indenture
with respect to any Collateral. To the extent permitted by applicable
law, Global Funding authorizes the Funding Note Indenture Trustee to
execute and file financing statements or continuation statements
without Global Funding's signature appearing thereon. Global Funding
agrees that a carbon, photographic, photostatic or other reproduction
of the Funding Note Indenture or of a financing statement is
sufficient as a financing statement. Global Funding shall pay the
costs of,
87
or incidental to, any recording or filing of any financing or
continuation statements concerning any Collateral.
(c) If any Collateral is at any time in the possession or control of any
warehouseman, bailee or any of Global Funding's agents or processors,
Global Funding shall notify such warehouseman, bailee, agent or
processor of the Security Interest created by the Funding Note
Indenture and to hold all such Collateral for the Funding Note
Indenture Trustee's account subject to the Funding Note Indenture
Trustee's instructions.
(d) Global Funding will, promptly upon request, provide to the Funding
Note Indenture Trustee all information and evidence it may reasonably
request concerning the Collateral to enable the Funding Note Indenture
Trustee to enforce the provisions of the Funding Note Indenture.
(e) Not more than six months nor less than 30 days prior to each date on
which Global Funding proposes to take any action contemplated by
Section 14.4(a), Global Funding shall, at its cost and expense, cause
to be delivered to the Funding Note Indenture Trustee an Opinion of
Counsel, satisfactory to the Funding Note Indenture Trustee, to the
effect that all financing statements and amendments or supplements
thereto, continuation statements and other documents required to be
recorded or filed in order to perfect and protect the Security
Interest for a period, specified in such Opinion of Counsel,
continuing until a date not earlier than 18 months from the date of
such Opinion of Counsel, against all creditors of and purchasers from
Global Funding have been filed in each filing office necessary for
such purpose and that all filing fees and taxes, if any, payable in
connection with such filings have been paid in full.
(f) From time to time upon request by the Funding Note Indenture Trustee,
Global Funding shall, at its cost and expense, cause to be delivered
to the Funding Note Indenture Trustee an Opinion of Counsel
satisfactory to the Funding Note Indenture Trustee as to such matters
relating to the Security Interest as the Funding Note Indenture
Trustee or the Holder Representative may reasonably request.
SECTION 14.5 General Authority. Global Funding irrevocably appoints the
Funding Note Indenture Trustee its true and lawful attorney, with full power of
substitution, in the name of Global Funding, the Funding Note Indenture Trustee,
the Holders of the Funding Note or otherwise, for the sole use and benefit of
the Secured
88
Parties, but at Global Funding's expense, to the extent permitted by law to
exercise, at any time and from time to time while an Event of Default has
occurred and is continuing, all or any of the following powers with respect to
all or any of the Collateral:
(a) to demand, sue for, collect, receive and give acquittance for any and
all monies due or to become due thereon or by virtue thereof,
(b) to settle, compromise, compound, prosecute or defend any action or
proceeding with respect thereto,
(c) to sell, transfer, assign or otherwise deal in or with the same or the
proceeds or avails thereof, as fully and effectually as if the Funding
Note Indenture Trustee were the absolute owner thereof, and
(d) to extend the time of payment of any or all thereof and to make any
allowance and other adjustments with reference thereto;
provided that the Funding Note Indenture Trustee shall give Global Funding not
less than 10 days' prior notice of the time and place of any sale or other
intended disposition of any of the Collateral, except any part of the Collateral
which threatens to decline speedily in value or is of a type customarily sold on
a recognized market.
SECTION 14.6 Remedies Upon Event of Default. If any Event of Default has
occurred and is continuing, the Funding Note Indenture Trustee may exercise on
behalf of the Secured Parties all rights of a secured party under applicable law
and, in addition, the Funding Note Indenture Trustee may, without being required
to give any notice, except as provided in the Funding Note Indenture or as may
be required by mandatory provisions of law, (i) apply all cash, if any, then
held by it as all or part of the Collateral as specified in Section 5.3 and (ii)
if there shall be no such cash or if such cash shall be insufficient to pay all
the Obligations in full, sell the Collateral (including each applicable Funding
Agreement) or any part thereof at public or private sale, for cash, upon credit
or for future delivery, and at such price or prices as the Funding Note
Indenture Trustee may deem satisfactory. Any Holder may be the purchaser of any
or all of the Collateral so sold at any public sale (or, if the Collateral is of
a type customarily sold in a recognized market or is of a type which is the
subject of widely distributed standard price quotations, at any private sale).
Global Funding will execute and deliver such documents and take such other
action as the Funding Note Indenture Trustee deems necessary or advisable in
order that any such sale may be made in compliance with law. Upon any such sale
the Funding Note Indenture Trustee shall have the right to deliver, assign and
transfer to the purchaser thereof the Collateral so sold. Each purchaser at any
such sale shall hold the Collateral so sold to it absolutely and free from any
claim or right of whatsoever kind, including any equity or right of redemption
of Global Funding which may be waived, and Global Funding, to the extent
89
permitted by law, specifically waives all rights of redemption, stay or
appraisal which it has or may have under any law. The notice (if any) of such
sale shall (A) in the case of a public sale, state the time and place fixed for
such sale, and (B) in the case of a private sale, state the day after which such
sale may be consummated. Any such public sale shall be held at such time or
times within ordinary business hours and at such place or places as the Funding
Note Indenture Trustee may fix in the notice of such sale. At any such sale the
Collateral may be sold in one lot as an entirety or in separate parcels, as the
Funding Note Indenture Trustee may determine. The Funding Note Indenture Trustee
shall not be obligated to make any such sale pursuant to any such notice. The
Funding Note Indenture Trustee may, without notice or publication, adjourn any
public or private sale or cause the same to be adjourned from time to time by
announcement at the time and place fixed for the sale, and such sale may be made
at any time or place to which the same may be so adjourned. In the case of any
sale of all or any part of the Collateral on credit or for future delivery, the
Collateral so sold may be retained by the Funding Note Indenture Trustee until
the selling price is paid by the purchaser thereof, but the Funding Note
Indenture Trustee shall not incur any liability in the case of the failure of
such purchaser to take up and pay for the Collateral so sold and, in the case of
any such failure, such Collateral may again be sold upon like notice. The
Funding Note Indenture Trustee, instead of exercising the power of sale
conferred upon it in the Funding Note Indenture, may proceed by a suit or suits
at law or in equity to foreclose a Security Interest and sell any Collateral, or
any portion thereof, under a judgment or decree of a court or courts of
competent jurisdiction.
SECTION 14.7 Limitation on Duties of Funding Note Indenture Trustee with
Respect to Collateral. Beyond the exercise of reasonable care in the custody
thereof, the Funding Note Indenture Trustee shall have no duty as to any portion
of the Collateral in its possession or control or in the possession or control
of any agent or bailee or as to the preservation of rights against prior parties
or any other rights pertaining thereto. The Funding Note Indenture Trustee shall
be deemed to have exercised reasonable care in the custody of the Collateral in
its possession if the Collateral is accorded treatment substantially equal to
that which it accords its own property, and shall not be liable or responsible
for any loss or damage to any of the Collateral, or for any diminution in the
value thereof, by reason of the act or omission of any warehouseman, carrier,
forwarding agency, consignee or other agent or bailee selected by the Funding
Note Indenture Trustee in good faith.
SECTION 14.8 Concerning the Funding Note Indenture Trustee. In furtherance
and not in derogation of the rights, privileges and immunities of the Funding
Note Indenture Trustee specified in the Funding Note Indenture:
(a) the Funding Note Indenture Trustee is authorized to take all such
action as is provided to be taken by it as Funding Note Indenture
Trustee under this Article and all other action reasonably incidental
thereto. As to any matters not expressly provided for in this Article
(including, without limitation, the timing and
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methods of realization upon any Collateral) the Funding Note Indenture
Trustee shall act or refrain from acting in accordance with written
instructions from the Holder or Holders of the required percentage of
the principal amount of the Funding Note for any instructions or, in
the absence of such instructions, in accordance with its discretion;
and
(b) the Funding Note Indenture Trustee shall not be responsible for the
existence, genuineness or value of any of the Collateral or for the
validity, perfection, priority or enforceability of the Security
Interest in any of the Collateral, whether impaired by operation of
law or by reason of any action or omission to act on its part under
the Funding Note Indenture.
SECTION 14.9 Termination of Security Interest. The Security Interest shall
terminate and all rights to the Collateral shall revert to Global Funding upon:
(i) the repayment in full of all Obligations; or (ii) concurrently with the
payment of the Immediate Redemption Price pursuant to Section 3.1(i). Upon such
termination of the Security Interest, and delivery of a certificate by Global
Funding to such effect, the Funding Note Indenture Trustee will, at the expense
of Global Funding, execute and deliver to Global Funding such documents as
Global Funding shall reasonably request to evidence the termination of the
Security Interest.
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EXHIBIT A-1
FORM OF FUNDING NOTE CERTIFICATE RELATED TO SECURED MEDIUM TERM NOTES
ISSUED UNDER THE
SECURED MEDIUM TERM NOTES PROGRAM
A-1-1
EXHIBIT A-2
FORM OF FUNDING NOTE CERTIFICATE RELATED TO SECURED MEDIUM TERM NOTES
ISSUED UNDER THE
ALLSTATE LIFE(R) CORENOTES(R) PROGRAM
A-2-1
EXHIBIT B
FORM OF CERTIFICATE OF AUTHENTICATION
This Funding Note Certificate is the Funding Note Certificate
representing the Funding Note described in the within-mentioned Funding Note
Indenture.
J.P. MORGAN TRUST COMPANY,
NATIONAL ASSOCIATION, as Funding
Note Indenture Trustee
By:
--------------------------------
Authorized Signatory
Dated:
B-1
EXHIBIT C
FORM OF FUNDING NOTE INDENTURE TRUSTEE REPORT PURSUANT TO SECTION 7.3(f)
Allstate Life Global Funding
Funding Note Indenture Trustee Report for Payment Date -:
1. the amount received by the Funding Note Indenture Trustee as of the last
Payment Date in respect of the principal, interest and premium, if any, on
Funding Agreements issued by Allstate Life Insurance Company ("Allstate
Life"),
2. the amount of payment on such Payment Date to holders allocable to
principal and premium, if any, and interest on the Funding Notes of
Allstate Life Global Funding and the amount of unpaid interest accrued on
such Funding Notes as of such Payment Date.
3. the aggregate original stated principal amount of the Funding Agreements,
the current interest rate thereon at the close of business on such Payment
Date, and
4. the aggregate principal balance of the Funding Notes at the close of
business on such Payment Date.
FUNDING NOTE NO. / FUNDING AGREEMENT NO(S). / CUSIP / ISSUE DATE / MATURITY
/ TYPE / RATE / INTEREST DUE / UNPAID INTEREST ACCRUED / * PRINCIPAL DUE
/ ORIGINAL OUTSTANDING / CURRENT OUTSTANDING(1)
5. the amounts of compensation received by the Funding Note Indenture Trustee
during the period relating to such Payment Date.
Paid by Global Funding: -
Paid by Allstate Life: -
* Principal Due includes any applicable premium.
- --------
(1) To be in chart format on actual report. These items are column titles.
C-1
EXHIBIT 4.8
FORM OF GLOBAL SECURITY FOR
SECURED MEDIUM TERM NOTES PROGRAM
[FACE OF GLOBAL SECURITY]
[If the global security is registered in the name of Cede & Co., insert
Unless this Note Certificate is presented by an authorized representative of the
Depository Trust Company, a New York corporation ("DTC"), to the issuer or its
agent for registration of transfer, exchange or payment, and any note issued is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC (and any payment is made to Cede & Co. or such
other entity as is requested by an authorized representative of DTC), any
transfer, pledge or other use hereof for value or otherwise by or to any person
is wrongful inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
This Note Certificate is a global security within the meaning of the standard
indenture terms hereinafter referred to and is registered in the name of Cede &
Co., or such other nominee of DTC, or any successor depositary ("Depositary"),
as requested by an authorized representative of the Depositary. The notes
represented by this Note Certificate may not be exchanged in whole or in part
for notes registered, and no transfer of the notes represented by this Note
Certificate in whole or in part may be registered, in the name of any person
other than the Depositary or a nominee thereof, except in the limited
circumstances described in the standard indenture terms. Every Note Certificate
authenticated and delivered upon registration of, transfer of, or in exchange
for, or in lieu of, this Note Certificate will be a global security subject to
the foregoing, except in such limited circumstances.]
CUSIP No.:
ISIN:
Common Code:
ALLSTATE LIFE GLOBAL FUNDING TRUST
SECURED MEDIUM TERM NOTES
Title of Notes: Stated Maturity Date:
Securities Exchange Listing: [ ] Yes [ ] No. If yes,
Principal Amount: $ indicate name(s) of Securities Exchange(s):
(or principal amount of foreign or composite currency)
Original Issue Date:
Issue Price:
Fixed Rate Notes: [ ] Yes [ ] No. If yes, Floating Rate Notes: [ ] Yes [ ] No. If yes,
Interest Rate: Regular Floating Rate Notes: [ ]
Interest Payment Dates: Inverse Floating Rate Notes: [ ]
Day Count Convention: Floating Rate/Fixed Rate Notes: [ ]
Additional/Other Terms: Interest Rate:
Amortizing Notes: [ ] Yes [ ] No. If yes, Interest Rate Basis(es):
Amortization Schedule: CD Rate [ ]
Additional/Other Terms: CMT Rate [ ]
Discount Notes: [ ] Yes [ ] No. If yes, Commercial Paper Rate [ ]
Total Amount of Discount: Constant Maturity Swap Rate [ ]
Initial Accrual Period of Discount: Eleventh District Cost of Funds Rate [ ]
Additional/Other Terms: Federal Funds Open Rate [ ]
Redemption Provisions: [ ] Yes [ ] No. If yes, Federal Funds Rate [ ]
Initial Redemption Date: LIBOR [ ]
Initial Redemption Percentage: EURIBOR [ ]
Annual Redemption Percentage Reduction, if any: Prime Rate [ ]
Additional/Other Terms: Treasury Rate [ ]
Repayment Provisions: [ ] Yes [ ] No. If yes, If LIBOR:
Optional Repayment Date(s): [ ] LIBOR Moneyline Telerate:
Optional Repayment Price: [ ] LIBOR Reuters:
Additional/Other Terms: LIBOR Currency:
Regular Interest Record Date(s): If CMT Rate:
Sinking Fund, if any: Designated CMT MoneylineTelerate Page:
Specified Currency: If CMT Moneyline Telerate Page 7052:
Exchange Rate Agent: [ ] Weekly Average
Calculation Agent: [ ] Monthly Average
Depositary: Designated CMT Maturity Index:
Authorized Denominations: Index Maturity:
Collateral: The right, title and interest of the Trust in
and to: Spread (+/-), if any:
(i) Allstate Life Insurance Company Funding Spread Multiplier, if any:
Agreement No(s). [ ]; (ii) all proceeds in respect of such Initial Interest Rate, if any:
Funding Agreement(s); and (iii) all books and records Initial Interest Reset Date:
(including, without limitation, computer programs, Interest Reset Dates:
printouts, and other computer materials and files) Interest Determination Date(s):
pertaining to such Funding Agreement(s). Interest Payment Dates:
Additional Amounts to be Paid for Withholding Tax: Maximum Interest Rate, if any:
[ ] Yes [ ] No Minimum Interest Rate, if any:
Fixed Rate Commencement Date, if any:
Floating Interest Rate, if any:
Fixed Interest Rate, if any:
Day Count Convention:
Additional/Other Terms:
This Note Certificate is a Global Security in respect of a duly authorized
issue of Notes (the "Notes") of the Allstate Life Global Funding Trust
designated above, a statutory trust organized under the laws of the State of
Delaware (the "Trust"). The Notes are issued under the Indenture, dated as of
the date hereof (as amended or supplemented from time to time, the "Indenture")
among the Trust and the other persons specified therein. Capitalized terms used
herein and not otherwise defined shall have the respective meanings ascribed in
the Standard Indenture Terms, which are incorporated by reference in and form a
part of the Indenture (as amended or supplemented from time to time, the
"Standard Indenture Terms").
The Trust, for value received, hereby promises to pay to [Cede & Co.] or
its registered assigns, on the Stated Maturity Date (or on the date of
redemption or repayment by the Trust prior to maturity pursuant to redemption or
repayment provisions, in each case, if provided for above) the principal amount
specified above and, if so specified above, to pay interest from time to time on
the Notes represented by this Note Certificate from the Original Issue Date
specified above (the "Original Issue Date") or from the most recent Interest
Payment Date to which interest has been paid or duly provided for at the rate
per annum determined in accordance with the provisions on the reverse hereof and
as specified above, until the principal of the Notes represented by this Note
Certificate is paid or made available for payment and to pay such other amounts
due and owing with respect to the Notes represented by this Note Certificate.
On any exchange or purchase and cancellation of any of the Notes
represented by this Note Certificate, details of such exchange or purchase and
cancellation shall be entered in the records of the Indenture Trustee. Upon any
such exchange or purchase and cancellation, the principal amount of the Notes
represented by this Note Certificate shall be charged by the principal amount so
exchanged or purchased and cancelled, as provided in the Standard Indenture
Terms.
Unless otherwise set forth above, if the Notes are subject to an Annual
Redemption Percentage Reduction as specified above, the Redemption Price of the
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Notes represented by this Note Certificate shall initially be the Initial
Redemption Percentage of the principal amount of the Notes represented by this
Note Certificate on the Initial Redemption Date and shall decline at each
anniversary of the Initial Redemption Date (each such date, a "Redemption Date")
by the Annual Redemption Percentage Reduction of such principal amount until the
Redemption Price is 100% of such principal amount.
The Notes will mature on the Stated Maturity Date, unless their principal
(or, any installment of their principal) becomes due and payable prior to the
Stated Maturity Date, whether, as applicable, by the declaration of acceleration
of maturity, notice of redemption at the option of the Trust, notice of the
Holder's option to elect repayment or otherwise (the Stated Maturity Date or any
date prior to the Stated Maturity Date on which the Notes become due and
payable, as the case may be, are referred to as the "Maturity Date" with respect
to principal of the Notes repayable on such date).
Unless otherwise provided above and except as provided in the following
paragraph, the Trust will pay interest on each Interest Payment Date specified
above, commencing with the first Interest Payment Date next succeeding the
Original Issue Date, and on the Maturity Date; provided that any payment of
principal, premium, if any, interest or other amounts to be made on any Interest
Payment Date or on a Maturity Date that is not a Business Day shall be made in
accordance with the provisions set forth on the reverse hereof.
Unless otherwise specified above, the interest payable on each Interest
Payment Date or on the Maturity Date will be the amount equal to the interest
accrued from and including the immediately preceding Interest Payment Date in
respect of which interest has been paid or from and including the date of issue,
if no interest has been paid, to but excluding the applicable Interest Payment
Date or the Maturity Date, as the case may be (each, an "Interest Period").
Reference is hereby made to the further provisions of the Notes set forth
on the reverse hereof and, if so specified on the face hereof, in an Addendum
hereto, which further provisions shall for all purposes have the same force and
effect as if set forth on the face hereof.
Notwithstanding the foregoing, if an Addendum is attached hereto or
"Other/Additional Provisions" apply to the Notes as specified above, the Notes
shall be subject to the terms set forth in such Addendum or such
"Other/Additional Provisions."
The Notes represented by this Note Certificate shall not be valid or become
obligatory for any purpose until the certificate of authentication hereon shall
have been executed by the Indenture Trustee pursuant to the Indenture.
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IN WITNESS WHEREOF, the Trust has caused this instrument to be duly
executed on its behalf.
Dated: Original Issue Date THE ALLSTATE LIFE GLOBAL FUNDING TRUST SPECIFIED
ON THE FACE OF THIS NOTE CERTIFICATE,
as Issuer
By: [WILMINGTON TRUST COMPANY],
not in its individual capacity,
but solely as Delaware Trustee
By:
-------------------------------------
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This Note Certificate is one of the Note Certificates representing Notes
described in the within-mentioned Indenture.
Dated: Original Issue Date [J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION],
as Indenture Trustee
By:
-------------------------------------
Authorized Signatory
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[REVERSE OF GLOBAL SECURITY]
SECTION 1. General. This Note Certificate is a Global Security in respect
of a duly authorized issue of Notes of the Trust. The Notes are issued pursuant
to the Indenture.
SECTION 2. Currency. The Notes are denominated in, and payments of
principal of, premium, if any, and interest on, if any, and other amounts in
respect of, the Notes will be in the Specified Currency designated on the face
hereof. If the Notes are Foreign Currency Notes, any amounts so payable by the
Trust in the Specified Currency will be converted by the exchange rate agent
designated on the face hereof (the "Exchange Rate Agent") into United States
dollars for payment to the registered holders hereof unless otherwise specified
on the face hereof or a registered holder elects, in the manner described below,
to receive payments in the Specified Currency.
If the Specified Currency for Foreign Currency Notes is not available for
any required payment of principal, premium, if any, and/or interest, if any, due
to the imposition of exchange controls or other circumstances beyond the control
of the Trust, the Trust will be entitled to satisfy the obligations to the
registered holders of such Foreign Currency Notes by making payments in United
States dollars based on the highest bid quotation in The City of New York
received by the Exchange Rate Agent at approximately 11:00 A.M., New York City
time, on the second Business Day preceding the applicable payment date from
three recognized foreign exchange dealers (one of whom may be the Exchange Rate
Agent) selected by the Exchange Rate Agent and approved by the Trust for the
purchase by the quoting dealer of the Specified Currency for United States
dollars for settlement on that payment date in the aggregate amount of the
Specified Currency payable to all registered holders of such Foreign Currency
Notes scheduled to receive United States dollar payments and at which the
applicable dealer commits to execute a contract. All currency exchange costs
will be borne by the relevant registered holders of such Foreign Currency Notes
by deductions from any payments. If three bid quotations are not available,
payments will be made in the Specified Currency.
Registered holders of Foreign Currency Notes may elect to receive all or a
specified portion of any payment of principal, premium, if any, and/or interest,
if any, in the Specified Currency by submitting a written request to the
Indenture Trustee at its corporate trust office in The City of New York on or
prior to the applicable Regular Interest Record Date or at least fifteen
calendar days prior to the Maturity Date, as the case may be. This written
request may be mailed or hand delivered or sent by cable, telex or other form of
facsimile transmission. This election will remain in effect until revoked by
written notice delivered to the Indenture Trustee on or prior to a Regular
Interest Record Date or at least fifteen calendar days prior to the Maturity
Date, as the case may be. Registered holders of Foreign Currency Notes to be
held in the name of a broker or nominee should contact their broker or nominee
to determine whether and how an election to receive payments in the Specified
Currency may be made.
Unless otherwise specified on the face hereof, if the Specified Currency is
other than United States dollars, a beneficial owner hereof which elects to
receive payments of principal, premium, if any, and/or interest, if any, in the
Specified Currency must notify the DTC participant (the "Participant") through
which it owns its interest on or prior to the applicable Regular Interest Record
Date or at least fifteen calendar days prior to the Maturity Date, as the case
may be, of its election. The applicable Participant must notify the Depositary
of its election on or prior to the third Business Day after the applicable
Regular Interest Record Date or at least twelve calendar days prior to the
Maturity Date, as the case may be, and the Depositary will notify the Indenture
Trustee of that election on or prior to the fifth Business Day after the
applicable Regular Interest Record Date or at least ten calendar days prior to
the Maturity Date, as the case may be. If complete instructions are received by
the Participant from the applicable beneficial owner and forwarded by the
Participant to the Depositary, and by the Depositary to the Indenture Trustee,
on or prior to such dates, then the applicable beneficial owner will receive
payments in the Specified Currency.
Unless otherwise specified on the face hereof, if payment in the Specified
Currency hereon is not available to the Trust for any required payment of
principal, premium, if any, and/or interest, if any, due to the imposition of
exchange controls or other circumstances beyond the Trust's control, then the
Trust will be entitled to satisfy its obligations by making payments in United
States dollars on the basis of the Market Exchange Rate, computed by the
Exchange Rate Agent as described above, on the second Business Day prior to the
particular payment or, if the
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Market Exchange is not then available, on basis of the most recently available
Market Exchange Rate. The "Market Exchange Rate" for a Specified Currency other
than United States dollars means the noon dollar buying rate in The City of New
York for cable transfers for the Specified Currency as certified for customs
purposes (or, if not so certified, as otherwise determined) by the Federal
Reserve Bank of New York. Any payment in respect hereof made under such
circumstances in U.S. Dollars will not constitute an Event of Default under the
Indenture.
In the event that a member state of the European Union in whose national
currency is the Specified Currency becomes a participant member in the third
stage of the European economic and monetary union, the Trust may on or after the
date of such occurrence, without the consent of the Holder hereof, redenominate
all, but not less than all, of the Notes hereof.
All determinations referred to above made by the Exchange Rate Agent shall
be at its sole discretion and, in the absence of manifest error, shall be
conclusive for all purposes and binding on the Holder hereof and any applicable
Entitlement Holders.
All currency exchange costs will be borne by the Holder hereof by deduction
from the payments made hereon.
SECTION 3. Determination of Interest Rate and Other Payment Provisions.
Fixed Rate Notes. If the Notes are designated on the face hereof as "Fixed
Rate Notes," the Notes will bear interest from the Original Issue Date until the
Maturity Date. Unless otherwise specified on the face hereof, the rate of
interest payable on the Notes will not be adjusted; unless otherwise specified
on the face hereof, interest will be payable on the Interest Payment Dates set
forth on the face hereof and at the Maturity Date. Interest will be computed on
the basis of a 360-day year of twelve 30-day months. If any Interest Payment
Date or the Maturity Date of Fixed Rate Notes falls on a day that is not a
Business Day, any payments of principal, premium, if any, and/or interest or
other amounts required to be made, will be made on the next succeeding Business
Day, and no additional interest will accrue in respect of the payment made on
that next succeeding Business Day.
Discount Notes. If the Notes are designated on the face hereof as "Discount
Notes" (as defined below), payments in respect of the Notes shall be made as set
forth on the face hereof. In the event a Discount Note is redeemed, repaid or
accelerated, the amount payable to the Holder of such Note will be equal to the
sum of: (1) the Issue Price (increased by any accruals of discount) and, in the
event of any redemption of such Discount Notes, if applicable, multiplied by the
Initial Redemption Percentage (as adjusted by the Annual Redemption Percentage
Reduction, if applicable); and (2) any unpaid interest accrued on such Discount
Notes to the date of redemption, repayment or acceleration of maturity, as
applicable. For purposes of determining the amount of discount that has accrued
as of any date on which a redemption, repayment or acceleration of maturity of
the Notes occurs for Discount Notes, the discount will be accrued using a
constant yield method. The constant yield will be calculated using a 30-day
month, 360-day year convention, a compounding period that, except for the
Initial Period (as defined below), corresponds to the shortest period between
Interest Payment Dates for the Discount Notes (with ratable accruals within a
compounding period), a coupon rate equal to the initial coupon rate applicable
to Discount Notes and an assumption that the maturity of such Discount Notes
will not be accelerated. If the period from the date of issue to the first
Interest Payment Date for Discount Notes (the "Initial Period") is shorter than
the compounding period for such Discount Notes, a proportionate amount of the
yield for an entire compounding period will be accrued. If the Initial Period is
longer than the compounding period, then the period will be divided into a
regular compounding period and a short period with the short period being
treated as provided in the preceding sentence. The accrual of the applicable
discount may differ from the accrual of original issue discount for purposes of
the Code, certain Discount Notes may not be treated as having original issue
discount within the meaning of the Code, and certain Notes other than Discount
Notes may be treated as issued with original issue discount for federal income
tax purposes. A "Discount Note" is any Note that has an Issue Price that is less
than 100% of the principal amount thereof by more than a percentage equal to the
product of 0.25% and the number of full years to the Stated Maturity Date. A
Discount Note may not bear any interest currently or may bear interest at a rate
that is below market rates at the time of issuance.
Amortizing Notes. If the Notes are specified on the face hereof as
"Amortizing Notes," the Notes shall bear interest at the rate set forth on the
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face hereof, and payments of principal and interest shall be made as set forth
on the face hereof and/or in accordance with Schedule I attached hereto. Unless
otherwise specified on the face hereof, interest on the Notes will be computed
on the basis of a 360-day year of twelve 30-day months. Payments with respect to
Amortizing Notes will be applied first to interest due and payable on the Notes
and then to the reduction of the unpaid principal amount of Notes represented by
this Note Certificate.
Floating Rate Notes. If the Notes are specified on the face hereof as
"Floating Rate Notes," interest on the Notes shall accrue and be payable in
accordance with this Section 3. A Floating Rate Note may be a CD Rate Note, CMT
Rate Note, Commercial Paper Rate Note, Constant Maturity Swap Rate Note,
Eleventh District Cost of Funds Rate Note, Federal Funds Open Rate Note, Federal
Funds Rate Note, LIBOR Note, EURIBOR Note, Prime Rate Note or Treasury Rate
Note. If the Notes are designated on the face hereof as Floating Rate Notes, the
face hereof will specify whether the Notes are Regular Floating Rate Notes,
Inverse Floating Rate Notes or Floating Rate/Fixed Rate Notes. For the period
from the date of issue to, but not including, the first Interest Reset Date set
forth on the face hereof, the interest rate hereon shall be the Initial Interest
Rate specified on the face hereof. Thereafter, the interest rate hereon will be
reset as of and be effective as of each Interest Reset Date.
(A) If any Interest Reset Date would otherwise be a day that is not a
Business Day, such Interest Reset Date shall be postponed to the next
day that is a Business Day; provided, however, that if the Notes are
LIBOR Notes or EURIBOR Notes and such Business Day is in the next
succeeding calendar month, such Interest Reset Date shall be the
Business Day immediately preceding such Interest Reset Date.
(B) Unless specified otherwise on the face hereof, Interest Reset Dates
are as follows: (1) if the Notes reset daily, each Business Day; (2)
if the Notes reset weekly, other than Treasury Rate Notes, the
Wednesday of each week; (3) if the Notes are Treasury Rate Notes that
reset weekly, and except as provided below under "Treasury Rate
Notes," the Tuesday of each week; (4) if the Notes reset monthly, the
third Wednesday of each month, unless the Eleventh District Cost of
Funds Rate is the Interest Rate Basis (as defined below) applicable to
the Notes, in which case the Notes will reset the first calendar day
of the month; (5) if the Notes reset quarterly, the third Wednesday of
every third calendar month, beginning in the third calendar month
following the month in which the Notes were issued; (6) if the Notes
reset semiannually, the third Wednesday of each of the two months
specified on the face hereof; and (7) if the Notes reset annually, the
third Wednesday of the month specified on the face hereof; provided,
however, that with respect to Floating Rate/ Fixed Rate Notes, the
rate of interest thereon will not reset after the particular Fixed
Rate Commencement Date specified on the face hereof (the "Fixed Rate
Commencement Date").
(C) Accrued interest is calculated by multiplying the principal amount of
such Floating Rate Note by an accrued interest factor. The accrued
interest factor is computed by adding the interest factor calculated
for each day in the particular Interest Period. The interest factor
for each day will be computed by dividing the interest rate applicable
to such day by 360, in the case of Floating Rate Notes as to which the
CD Rate, the Commercial Paper Rate, the Eleventh District Cost of
Funds Rate, the Federal Funds Open Rate, the Federal Funds Rate,
LIBOR, EURIBOR or the Prime Rate is an applicable Interest Rate Basis,
or by the actual number of days in the year, in the case of Floating
Rate Notes as to which the CMT Rate or the Treasury Rate is an
applicable Interest Rate Basis. In the case of a Floating Rate Note as
to which the Constant Maturity Swap Rate is the Interest Rate Basis,
the interest factor will be computed by dividing the number of days in
the interest period by 360 (the number of days to be calculated on the
basis of a year of 360 days with 12 30-day months (unless (i) the last
day of the interest period is the 31st day of a month but the first
day of the interest period is a day other than the 30th or 31st day of
a month, in which case the month that includes that last day shall not
be considered to be shortened to a 30-day month, or (ii) the last day
of the interest period is the last day of the month of February, in
which case the month of February shall not be considered to be
lengthened to a 30-day month)). The interest factor for Floating Rate
Notes as to which the interest rate is calculated with reference to
two or more Interest Rate Bases will be calculated in each period in
the same manner as if only the applicable Interest Rate Basis
specified on the face hereof applied. The interest rate shall be set
forth on the face hereof. For purposes of making the foregoing
calculation, the interest rate in effect on any Interest Reset Date
will be the applicable rate as reset on that date. Unless otherwise
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specified on the face hereof, the interest rate that is effective on
the applicable Interest Reset Date will be determined on the
applicable Interest Determination Date and calculated on the
applicable Calculation Date (as defined below).
"Calculation Date" means the date by which the Calculation Agent
designated on the face hereof, is to calculate the interest rate
which will be the earlier of: (1) the tenth calendar day after
the particular Interest Determination Date or, if such day is not
a Business Day, the next succeeding Business Day; or (2) the
Business Day immediately preceding the applicable Interest
Payment Date or the Maturity Date, as the case may be.
(D) Unless otherwise specified on the face hereof, all percentages
resulting from any calculation on Floating Rate Notes will be rounded
to the nearest one hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upwards. All dollar
amounts used in or resulting from any calculation on Floating Rate
Notes will be rounded, in the case of United States dollars, to the
nearest cent or, in the case of a foreign currency, to the nearest
unit (with one-half cent or unit being rounded upwards).
(E) Unless otherwise specified on the face hereof, if the Notes are
designated on the face hereof as Floating Rate Notes, if any Interest
Payment Date (other than the Maturity Date for the Notes) would
otherwise be a day that would not be a Business Day, such Interest
Payment Date would be postponed to the next succeeding Business Day;
provided, however, that if the Notes are LIBOR Notes or EURIBOR Notes
and such Business Day is in the next succeeding calendar month, such
Interest Payment Date shall be the immediately preceding Business Day.
Unless otherwise specified on the face hereof, if the Notes are
designated on the face hereof as Floating Rate Notes, if the Maturity
Date of the Notes falls on a day this is not a Business Day, the Trust
will make the required payment of principal, premium, if any, and
interest or other amounts on the next succeeding Business Day, and no
additional interest will accrue in respect of the payment made on that
next succeeding Business Day.
Unless otherwise specified on the face hereof and except as provided below,
interest will be payable as follows: (1) if the Interest Reset Date for the
Notes is daily, weekly or monthly, interest will be payable on the third
Wednesday of each month or on the third Wednesday of every third calendar month,
beginning in the third calendar month following the month in which the Notes
were issued, as specified on the face hereof; (2) if the Interest Reset Date for
the Notes is quarterly, interest will be payable on the third Wednesday of every
third calendar month, beginning in the third calendar month following the month
in which the Notes were issued; (3) if the Interest Reset Date for the Notes is
semiannually, interest will be payable on the third Wednesday of each of two
months of each year specified on the face hereof; or (4) if the Interest Reset
Date for the Notes is annually, interest will be payable on the third Wednesday
of the month of each year specified on the face hereof. In each of these cases,
the Maturity Date will also be an Interest Payment Date.
If specified on the face hereof, the Notes may have either or both of a
Maximum Interest Rate or Minimum Interest Rate. If a Maximum Interest Rate is so
designated, the interest rate that may accrue during any Interest Period for
Floating Rate Notes cannot ever exceed such Maximum Interest Rate and in the
event that the interest rate on any Interest Reset Date would exceed such
Maximum Interest Rate (as if no Maximum Interest Rate were in effect) then the
interest rate on such Interest Reset Date shall be the Maximum Interest Rate. If
a Minimum Interest Rate is so designated, the interest rate that may accrue
during any Interest Period for Floating Rate Notes cannot ever be less than such
Minimum Interest Rate and in the event that the interest rate on any Interest
Reset Date would be less than such Minimum Interest Rate (as if no Minimum
Interest Rate were in effect) then the interest rate on such Interest Reset Date
shall be the Minimum Interest Rate. Notwithstanding anything to the contrary
contained herein, if the Notes are designated on the face hereof as Floating
Rate Notes, the interest rate on Notes shall not exceed the maximum interest
rate permitted by applicable law.
All determinations of interest by the Calculation Agent designated on the
face hereof will, in the absence of manifest error, be conclusive for all
purposes and binding on the Holder of the Notes and neither the Indenture
Trustee nor the Calculation Agent shall have any liability to the Holder of the
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Notes in respect of any determination, calculation, quote or rate made or
provided by the Calculation Agent. Upon request of the Holder of the Notes, the
Calculation Agent will provide the interest rate then in effect and, if
determined, the interest rate that will become effective on the next Interest
Reset Date with respect to the Notes. If the Calculation Agent is incapable or
unwilling to act as such or if the Calculation Agent fails duly to establish the
interest rate for any interest accrual period or to calculate the interest
amount or any other requirements, the Trust will appoint a successor to act as
such in its place. The Calculation Agent may not resign its duties until a
successor has been appointed and such successor has accepted its appointment.
Subject to applicable provisions of law and except as specified herein, on
each Interest Reset Date, the rate of interest on the Notes on and after the
first Interest Reset Date shall be the interest rate determined in accordance
with the provisions of the heading below which has been designated as the
Interest Rate Basis on the face hereof (the "Interest Rate Basis"), the base
rate, plus or minus the Spread, if any, specified on the face hereof and/or
multiplied by the Spread Multiplier, if any, specified on the face hereof.
(A) CD Rate Notes. If the Interest Rate Basis is the CD Rate, the Notes
shall be deemed to be "CD Rate Notes." CD Rate Notes will bear
interest at the interest rate calculated with reference to the CD Rate
and the Spread or Spread Multiplier, if any. The Calculation Agent
will determine the CD Rate on each Interest Determination Date. The
Interest Determination Date is the second Business Day preceding the
related Interest Reset Date.
"CD Rate" means: (1) the rate on the particular Interest
Determination Date for negotiable United States dollar
certificates of deposit having the Index Maturity specified on
the face hereof as published in H.15(519) (as defined below)
under the caption "CDs (secondary market)"; or (2) if the rate
referred to in clause (1) is not so published by 3:00 P.M., New
York City time, on the related Calculation Date, the rate on the
particular Interest Determination Date for negotiable United
States dollar certificates of deposit of the particular Index
Maturity as published in the H.15 Daily Update (as defined below)
or other recognized electronic source used for the purpose of
displaying the applicable rate, under the heading "CDs (secondary
market)"; or (3) if the rate referred to in clause (2) is not yet
published in either H.15(519) or the H.15 Daily Update by 3:00
P.M., New York City time, on the related Calculation Date, then
the CD Rate will be the rate on the particular Interest
Determination Date calculated by the Calculation Agent as the
arithmetic mean of the secondary market offered rates as of 10:00
A.M., New York City time on that Interest Determination Date of
three leading nonbank dealers in negotiable United States dollar
certificates of deposit in The City of New York (which may
include the Agents or their affiliates) selected by the
Calculation Agent for negotiable United States dollar
certificates of deposit of major United States money market banks
for negotiable United States certificates of deposit with a
remaining maturity closest to the particular Index Maturity in an
amount that is representative for a single transaction in that
market at that time; or (4) if the dealers so selected by the
Calculation Agent are not quoting as mentioned in clause (3), the
CD Rate in effect on the particular Interest Determination Date;
provided that if no CD Rate is then in effect, the interest rate
that will be effective as of the next Interest Reset Date will be
the Initial Interest Rate.
"H.15(519)" means the weekly statistical release designated as
H.15(519), or any successor publication, published by the Board
of Governors of the Federal Reserve System.
"H.15 Daily Update" means the daily update of H.15(519),
available through the world-wide-web site of the Board of
Governors of the Federal Reserve System at
http://www.federalreserve.gov/releases/H15/update, or any
successor site or publication.
(B) CMT Rate Notes. If the Interest Basis is the CMT Rate, the Notes shall
be deemed to be "CMT Rate Notes." CMT Rate Notes will bear interest at
the interest rate calculated with reference to the CMT Rate and the
9
Spread or Spread Multiplier, if any. The Calculation Agent will
determine the CMT Rate on each applicable Interest Determination Date.
The applicable Interest Determination Date is the second Business Day
preceding the Interest Reset Date.
"CMT Rate" means: (1) if CMT Moneyline Telerate Page 7051 is
specified on the face hereof: (a) the percentage equal to the
yield for United States Treasury securities at "constant
maturity" having the Index Maturity specified on the face hereof
as published in H.15(519) under the caption "Treasury Constant
Maturities", as the yield is displayed on Moneyline Telerate (or
any successor service) on page 7051 (or any other page as may
replace the specified page on that service) ("Moneyline Telerate
Page 7051"), for the particular Interest Determination Date; or
(b) if the rate referred to in clause (a) does not so appear on
Moneyline Telerate Page 7051, the percentage equal to the yield
for United States Treasury securities at "constant maturity"
having the particular Index Maturity and for the particular
Interest Determination Date as published in H.15(519) under the
caption "Treasury Constant Maturities"; or (c) if the rate
referred to in clause (b) does not so appear in H.15(519), the
rate on the particular Interest Determination Date for the period
of the particular Index Maturity as may then be published by
either the Federal Reserve System Board of Governors or the
United States Department of the Treasury that the Calculation
Agent determines to be comparable to the rate which would
otherwise have been published in H.15(519); or (d) if the rate
referred to in clause (c) is not so published, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent as a yield to maturity based on the arithmetic
mean of the secondary market bid prices at approximately 3:30
P.M., New York City time, on that Interest Determination Date of
three leading primary United States government securities dealers
in The City of New York (which may include the Agents or their
affiliates) (each, a "Reference Dealer"), selected by the
Calculation Agent from five Reference Dealers selected by the
Calculation Agent and eliminating the highest quotation, or, in
the event of equality, one of the highest, and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity equal
to the particular Index Maturity, a remaining term to maturity no
more than one year shorter than that Index Maturity and in a
principal amount that is representative for a single transaction
in the securities in that market at that time; or (e) if fewer
than five but more than two of the prices referred to in clause
(d) are provided as requested, the rate on the particular
Interest Determination Date calculated by the Calculation Agent
based on the arithmetic mean of the bid prices obtained and
neither the highest nor the lowest of the quotations shall be
eliminated; or (f) if fewer than three prices referred to in
clause (d) are provided as requested, the rate on the particular
Interest Determination Date calculated by the Calculation Agent
as a yield to maturity based on the arithmetic mean of the
secondary market bid prices as of approximately 3:30 P.M., New
York City time, on that Interest Determination Date of three
Reference Dealers selected by the Calculation Agent from five
Reference Dealers selected by the Calculation Agent and
eliminating the highest quotation or, in the event of equality,
one of the highest and the lowest quotation or, in the event of
equality, one of the lowest, for United States Treasury
securities with an original maturity greater than the particular
Index Maturity, a remaining term to maturity closest to that
Index Maturity and in a principal amount that is representative
for a single transaction in the securities in that market at that
time; or (g) if fewer than five but more than two prices referred
to in clause (f) are provided as requested, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent based on the arithmetic mean of the bid prices
obtained and neither the highest nor the lowest of the quotations
will be eliminated; or (h) if fewer than three prices referred to
in clause (f) are provided as requested, the CMT Rate in effect
on the particular Interest Determination Date; provided that if
no CMT Rate is then in effect, the interest rate that will be
effective as of the next Interest Reset Date will be the Initial
Interest Rate; or (2) if CMT Moneyline Telerate Page 7052 is
specified on the face hereof: (a) the percentage equal to the
one-week or one-month, as specified on the face hereof, average
yield for United States Treasury securities at "constant
maturity" having the Index Maturity specified on the face hereof
as published in H.15(519) opposite the caption "Treasury Constant
10
Maturities", as the yield is displayed on Moneyline Telerate (or
any successor service) (on page 7052 or any other page as may
replace the specified page on that service) ("Moneyline Telerate
Page 7052"), for the week or month, as applicable, ended
immediately preceding the week or month, as applicable, in which
the particular Interest Determination Date falls; or (b) if the
rate referred to in clause (a) does not so appear on Moneyline
Telerate Page 7052, the percentage equal to the one-week or
one-month, as specified on the face hereof, average yield for
United States Treasury securities at "constant maturity" having
the particular Index Maturity and for the week or month, as
applicable, preceding the particular Interest Determination Date
as published in H.15(519) opposite the caption "Treasury Constant
Maturities"; or (c) if the rate referred to in clause (b) does
not so appear in H.15(519), the one-week or one-month, as
specified on the face hereof, average yield for United States
Treasury securities at "constant maturity" having the particular
Index Maturity as otherwise announced by the Federal Reserve Bank
of New York for the week or month, as applicable, ended
immediately preceding the week or month, as applicable, in which
the particular Interest Determination Date falls; or (d) if the
rate referred to in clause (c) is not so published, the rate on
the particular Interest Determination Date calculated by the
Calculation Agent as a yield to maturity based on the arithmetic
mean of the secondary market bid prices at approximately 3:30
P.M., New York City time, on that Interest Determination Date of
three Reference Dealers selected by the Calculation Agent from
five Reference Dealers selected by the Calculation Agent and
eliminating the highest quotation, or, in the event of equality,
one of the highest, and the lowest quotation or, in the event of
equality, one of the lowest, for United States Treasury
securities with an original maturity equal to the particular
Index Maturity, a remaining term to maturity no more than one
year shorter than that Index Maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at that time; or (e) if fewer than five but more
than two of the prices referred to in clause (d) are provided as
requested, the rate on the particular Interest Determination Date
calculated by the Calculation Agent based on the arithmetic mean
of the bid prices obtained and neither the highest nor the lowest
of the quotations shall be eliminated; or (f) if fewer than three
prices referred to in clause (d) are provided as requested, the
rate on the particular Interest Determination Date calculated by
the Calculation Agent as a yield to maturity based on the
arithmetic mean of the secondary market bid prices as of
approximately 3:30 P.M., New York City time, on that Interest
Determination Date of three Reference Dealers selected by the
Calculation Agent from five Reference Dealers selected by the
Calculation Agent and eliminating the highest quotation or, in
the event of equality, one of the highest and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity
greater than the particular Index Maturity, a remaining term to
maturity closest to that Index Maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at the time; or (g) if fewer than five but more
than two prices referred to in clause (f) are provided as
requested, the rate on the particular Interest Determination Date
calculated by the Calculation Agent based on the arithmetic mean
of the bid prices obtained and neither the highest nor the lowest
of the quotations will be eliminated; or (h) if fewer than three
prices referred to in clause (f) are provided as requested, the
CMT Rate in effect on that Interest Determination Date; provided
that if no CMT Rate is then in effect, the interest rate that
will be effective as of the next Interest Reset Date will be the
Initial Interest Rate.
If two United States Treasury securities with an original
maturity greater than the Index Maturity specified on the face
hereof have remaining terms to maturity equally close to the
particular Index Maturity, the quotes for the United States
Treasury security with the shorter original remaining term to
maturity will be used.
(C) Commercial Paper Rate Notes. If the Interest Rate Basis is the
Commercial Paper Rate, the Notes shall be deemed to be "Commercial
Paper Rate Notes." Commercial Paper Rate Notes will bear interest for
11
each Interest Reset Date at the interest rate calculated with
reference to the Commercial Paper Rate and the Spread or Spread
Multiplier, if any. The Calculation Agent will determine the
Commercial Paper Rate on each applicable Interest Determination Date.
The Interest Determination Date is the second Business Day preceding
the related Interest Reset Date.
"Commercial Paper Rate" means: (1) the Money Market Yield
(calculated as described below) on the Interest Determination
Date of the rate for commercial paper having the applicable Index
Maturity as such rate is published in H.15(519) under the heading
"Commercial Paper--Nonfinancial"; or (2) if the rate referred to
in clause (1) is not published by 3:00 P.M., New York City time,
on the Calculation Date pertaining to such Interest Determination
Date, then the Commercial Paper Rate shall be the Money Market
Yield on the particular Interest Determination Date of the rate
for commercial paper having the particular Index Maturity as
published on H.15 Daily Update or such other recognized
electronic source used for the purpose of displaying the
applicable rate, under the caption "Commercial
Paper--Nonfinancial"; or (3) if the rate referred to in clause
(2) is not published by 3:00 P.M., New York City time, on the
Calculation Date, then the Commercial Paper Rate as calculated by
the Calculation Agent shall be the Money Market Yield of the
arithmetic mean of the offered rates at approximately 11:00 A.M.,
New York City time, on that Interest Determination Date of three
leading dealers of United States dollar commercial paper in The
City of New York (which may include the Agents or their
affiliates) selected by the Calculation Agent for commercial
paper having the particular Index Maturity placed for industrial
issuers whose bond rating is "Aa" by Moody's or the equivalent
from another nationally recognized statistical rating
organization; or (4) if the dealers so selected by the
Calculation Agent are not quoting as mentioned in clause (3), the
Commercial Paper Rate in effect on the particular Interest
Determination Date; provided that if no Commercial Paper Rate is
then in effect, the interest rate that will be effective as of
the next Interest Reset Date will be the Initial Interest Rate.
"Money Market Yield" shall be a yield (expressed as a percentage)
calculated in accordance with the following formula:
Money Market Yield = D x 360 x 100
---------------------------
360 - (D x M)
where "D" refers to the per annum rate for the commercial paper,
quoted on a bank discount basis and expressed as a decimal; and
"M" refers to the actual number of days in the applicable
Interest Period.
(D) Constant Maturity Swap Rate Notes. If the Interest Basis is the
Constant Maturity Swap Rate, the Notes shall be deemed to be "Constant
Maturity Swap Rate Notes." Constant Maturity Swap Rate Notes will bear
interest at the interest rate calculated with reference to the
Constant Maturity Swap Rate and the Spread or Spread Multiplier, if
any. The Calculation Agent will determine the Constant Maturity Swap
Rate on each applicable Interest Determination Date. The Interest
Determination Date is the second U.S. Government Securities Business
Day (as defined below) preceding the related Interest Reset Date;
provided, however, that if, after attempting to determine the Constant
Maturity Swap Rate (as described below), such rate is not determinable
for a particular Interest Determination Date (the "Original Interest
Determination Date"), then such Interest Determination Date shall be
the first U.S. Government Securities Business Day preceding the
Original Interest Determination Date for which the Constant Maturity
Swap Rate can be determined as described below.
Constant Maturity Swap Rate" means: (1) the rate for U.S. Dollar
swaps with the designated maturity specified on the face hereof,
expressed as a percentage, which appears on the Reuters Screen
ISDAFIX1 Page as of 11:00 A.M., New York City time, on the
particular Interest Determination Date; or (2) if the rate
12
referred to in clause (1) does not appear on the Reuters Screen
ISDAFIX1 Page by 2:00 P.M., New York City time, on such Interest
Determination Date, a percentage determined on the basis of the
mid-market semi-annual swap rate quotations provided by the
Reference Banks (as defined below) as of approximately 11:00
A.M., New York City time, on such Interest Determination Date,
and, for this purpose, the semi-annual swap rate means the mean
of the bid and offered rates for the semi-annual fixed leg,
calculated on a 30/360 day count basis, of a fixed-for-floating
U.S. Dollar interest rate swap transaction with a term equal to
the designated maturity specified in the face hereof commencing
on the Interest Reset Date and in a Representative Amount (as
defined below) with an acknowledged dealer of good credit in the
swap market, where the floating leg, calculated on an Actual/360
day count basis, is equivalent to USD-LIBOR-BBA with a designated
maturity specified on the face hereof. The Calculation Agent will
request the principal New York City office of each of the
Reference Banks to provide a quotation of its rate. If at least
three quotations are provided, the rate for that Interest
Determination Date will be the arithmetic mean of the quotations,
eliminating the highest quotation (or, in the event of equality,
one of the highest) and the lowest quotation (or, in the event of
equality, one of the lowest).
"U.S. Government Securities Business Day" means any day except
for Saturday, Sunday, or a day on which The Bond Market
Association recommends that the fixed income departments of its
members be closed for the entire day for purposes of trading in
U.S. government securities.
"Representative Amount" means an amount that is representative
for a single transaction in the relevant market at the relevant
time.
"Reference Banks" mean five leading swap dealers in the New York
City interbank market, selected by the Calculation Agent, after
consultation with Allstate Life Insurance Company ("Allstate
Life").
(E) Eleventh District Cost of Funds Rate Notes. If the Interest Basis is
the Eleventh District Costs of Funds Rate, the Notes shall be deemed
to be "Eleventh District Cost of Funds Rate Notes." Eleventh District
Cost of Funds Notes will bear interest at the interest rate calculated
with reference to the Eleventh District Cost of Funds Rate and the
Spread or Spread Multiplier, if any. The Calculation Agent will
determine the Eleventh District Cost of Rate on each applicable
Interest Determination Date. The applicable Interest Determination
Date is the last working day of the month immediately preceding the
related Interest Reset Date on which the Federal Home Loan Bank of San
Francisco publishes the Eleventh District Index (as defined below).
The "Eleventh District Cost of Funds Rate" means: (1) the rate
equal to the monthly weighted average cost of funds for the
calendar month immediately preceding the month in which the
particular Interest Determination Date falls as set forth under
the caption "11th District" on the display on Moneyline Telerate
(or any successor service) on page 7058 (or any other page as may
replace the specified page on that service) ("Moneyline Telerate
Page 7058") as of 11:00 A.M., San Francisco time, on that
Interest Determination Date; or (2) if the rate referred to in
clause (1) does not so appear on Moneyline Telerate Page 7058,
the monthly weighted average cost of funds paid by member
institutions of the Eleventh Federal Home Loan Bank District that
was most recently announced (the "Eleventh District Index") by
the Federal Home Loan Bank of San Francisco as the cost of funds
for the calendar month immediately preceding that Interest
Determination Date; or (3) if the Federal Home Loan Bank of San
Francisco fails to announce the Eleventh District Index on or
prior to the particular Interest Determination Date for the
calendar month immediately preceding that Interest Determination
Date, the Eleventh District Cost of Funds Rate in effect on the
particular Interest Determination Date; provided that if no
Eleventh District Cost of Funds Rate is then in effect, the
interest rate that will be effective as of the next Interest
Reset Date will be the Initial Interest Rate.
13
(F) Federal Funds Open Rate Notes. If the Interest Basis is the Federal
Funds Open Rate, the Notes shall be deemed to be "Federal Funds Open
Rate Notes." Federal Funds Open Rate Notes will bear interest at the
interest rate calculated with reference to the Federal Funds Open Rate
and the Spread or Spread Multiplier, if any. The Calculation Agent
will determine the Federal Funds Open Rate on each applicable Interest
Determination Date. The Interest Determination Date is the related
Interest Reset Date.
"Federal Funds Open Rate" means the rate set forth on Moneyline
Telerate Page 5 for an Interest Reset Date underneath the caption
"FEDERAL FUNDS" in the row titled "OPEN". If the rate is not
available for an Interest Reset Date, the rate for that Interest
Reset Date shall be the Federal Funds Rate as determined below.
(G) Federal Funds Rate Notes. If the Interest Rate Basis is the Federal
Funds Rate, the Notes shall be deemed to be "Federal Funds Rate
Notes." Federal Funds Rate Notes will bear interest for each Interest
Reset Date at the interest rate calculated with reference to the
Federal Funds Rate and the Spread or Spread Multiplier, if any. The
Calculation Agent will determine the Federal Funds Rate on each
applicable Interest Determination Date. The Interest Determination
Date is the Business Day immediately preceding the related Interest
Reset Date.
"Federal Funds Rate" means: (1) the rate on the particular
Interest Determination Date for United States dollar federal
funds as published in H.15(519) under the caption "Federal Funds
(Effective)" and displayed on Moneyline Telerate (or any
successor service) on page 120 (or any other page as may replace
the specified page on that service) ("Moneyline Telerate Page
120"); or (2) if the rate referred to in clause (1) does not so
appear on Moneyline Telerate Page 120 or is not so published by
3:00 P.M., New York City time, on the related Calculation Date,
the rate on the particular Interest Determination Date for United
States dollar federal funds as published in H.15 Daily Update, or
such other recognized electronic source used for the purpose of
displaying the applicable rate, under the caption "Federal Funds
(Effective)"; or (3) if the rate referred to in clause (2) is not
so published by 3:00 P.M., New York City time, on the related
Calculation Date, the rate on the particular Interest
Determination Date calculated by the Calculation Agent as the
arithmetic mean of the rates for the last transaction in
overnight United States dollar federal funds arranged by three
leading brokers of United States dollar federal funds
transactions in The City of New York (which may include the
Agents or their affiliates), selected by the Calculation Agent
prior to 9:00 A.M., New York City time, on the business day
following that Interest Determination Date; or (4) if the brokers
so selected by the Calculation Agent are not quoting as mentioned
in clause (3), the Federal Funds Rate in effect on the particular
Interest Determination Date; provided that if no Federal Funds
Rate is then in effect, the interest rate that will be effective
as of the next Interest Reset Date will be the Initial Interest
Rate.
(H) LIBOR Notes. If the Interest Rate Basis is LIBOR (as defined below),
the Notes shall be deemed to be "LIBOR Notes." LIBOR Notes will bear
interest for each Interest Period at the interest rate calculated with
reference to LIBOR and the Spread or Spread Multiplier, if any. On
each applicable Interest Determination Date the Calculation Agent will
determine LIBOR. The applicable Interest Determination Date is the
second London Banking Day (as defined below) preceding the related
Interest Reset Date.
LIBOR means: (1) if "LIBOR Moneyline Telerate" is specified on
the face hereof or if neither "LIBOR Reuters" nor "LIBOR
Moneyline Telerate" is specified on the face hereof as the method
for calculating LIBOR, the rate for deposits in the LIBOR
Currency (as defined below) having the Index Maturity specified
on the face hereof, commencing on the related Interest Reset
Date, that appears on the LIBOR Page (as defined below) as of
11:00 A.M., London time, on the particular Interest Determination
Date; or (2) if "LIBOR Reuters" is specified on the face hereof,
the arithmetic mean of the offered rates, calculated by the
Calculation Agent, or the offered rate, if the LIBOR Page by its
terms
14
provides only for a single rate, for deposits in the LIBOR
Currency having the particular Index Maturity, commencing on the
related Interest Reset Date, that appear or appears, as the case
may be, on the LIBOR Page as of 11:00 A.M., London time, on the
particular Interest Determination Date; or (3) if fewer than two
offered rates appear, or no rate appears, as the case may be, on
the particular Interest Determination Date on the LIBOR Page as
specified in clause (1) or (2), as applicable, the rate
calculated by the Calculation Agent of at least two offered
quotations obtained by the Calculation Agent after requesting the
principal London offices of each of four major reference banks
(which may include affiliates of the Agents), in the London
interbank market to provide the Calculation Agent with its
offered quotation for deposits in the LIBOR Currency for the
period of the particular Index Maturity, commencing on the
related Interest Reset Date, to prime banks in the London
interbank market at approximately 11:00 A.M., London time, on
that Interest Determination Date and in a principal amount that
is representative for a single transaction in the LIBOR Currency
in that market at that time; or (4) if fewer than two offered
quotations referred to in clause (3) are provided as requested,
the rate calculated by the Calculation Agent as the arithmetic
mean of the rates quoted at approximately 11:00 A.M., in the
applicable Principal Financial Center, on the particular Interest
Determination Date by three major banks (which may include
affiliates of the Agents), in that Principal Financial Center
selected by the Calculation Agent for loans in the LIBOR Currency
to leading European banks, having the particular Index Maturity
and in a principal amount that is representative for a single
transaction in the LIBOR Currency in that market at that time; or
(5) if the banks so selected by the Calculation Agent are not
quoting as mentioned in clause (4), LIBOR in effect on the
particular Interest Determination Date; provided that if no LIBOR
is then in effect, the interest rate that will be effective as of
the next Interest Reset Date will be the Initial Interest Rate.
"LIBOR Currency" means the currency specified on the face hereof
as to which LIBOR shall be calculated or, if no currency is
specified on the face hereof, United States dollars.
"LIBOR Page" means either: (1) if "LIBOR Reuters" is specified on
the face hereof, the display on the Reuter Monitor Money Rates
Service (or any successor service) on the page specified on the
face hereof (or any other page as may replace that page on that
service) for the purpose of displaying the London interbank rates
of major banks for the LIBOR Currency; or (2) if "LIBOR Moneyline
Telerate" is specified on the face hereof or neither "LIBOR
Reuters" nor "LIBOR Moneyline Telerate" is specified on the face
hereof as the method for calculating LIBOR, the display on
Moneyline Telerate (or any successor service) on the page
specified on the face hereof (or any other page as may replace
such page on such service) for the purpose of displaying the
London interbank rates of major banks for the LIBOR Currency.
"London Banking Day" means a day on which commercial banks are
open for business (including dealings in the LIBOR Currency) in
London.
(I) EURIBOR Notes. If the Interest Rate Basis is EURIBOR (as defined
below), the Notes shall be deemed to be "EURIBOR Notes." EURIBOR Notes
will bear interest at the rates (calculated with references to the
European inter-bank offered rate for deposits in Euro, or "EURIBOR",
and the Spread and/or Spread Multiplier, if any) specified on the face
hereof.
"EURIBOR" means, with respect to any Interest Determination Date
relating to EURIBOR Notes or Notes that bear interest at floating
rates for which the interest rate is determined with reference to
EURIBOR (a "EURIBOR Interest Determination Date"), the rate for
deposits in Euros as sponsored, calculated and published jointly
by the European Banking Federation and ACI--The Financial Market
Association, or any company established by the joint sponsors for
purposes of compiling and publishing those rates, having the
Index Maturity specified on the face hereof, commencing on the
applicable Interest Reset Date, as the rate appears on Moneyline
Telerate, Inc., or any
15
successor service, on page 248 (or any other page as may replace
that specified page on the service) ("Moneyline Telerate Page
248") as of 11:00 A.M., Brussels time, on the applicable EURIBOR
Interest Determination Date. If such rate does not appear on
Moneyline Telerate Page 248, or is not so published by 11:00
A.M., Brussels time, on the applicable EURIBOR Interest
Determination Date, such rate will be calculated by the
Calculation Agent and will be the arithmetic mean of at least two
quotations obtained by the Calculation Agent after requesting the
principal Euro-zone (as defined below) offices of four major
banks in the Euro-zone interbank market to provide the
Calculation Agent with its offered quotation for deposits in
Euros for the period of the Index Maturity specified on the face
hereof, commencing on the applicable Interest Reset Date, to
prime banks in the Euro-zone interbank market at approximately
11:00 A.M., Brussels time, on the applicable EURIBOR Interest
Determination Date and in a principal amount not less than the
equivalent of $1 million in Euros that is representative for a
single transaction in Euro in the market at that time. If fewer
than two such quotations are so provided, the rate on the
applicable EURIBOR Interest Determination Date will be calculated
by the Calculation Agent and will be the arithmetic mean of the
rates quoted at approximately 11:00 A.M., Brussels time, on such
EURIBOR Interest Determination Date by four major banks in the
Euro-zone for loans in Euro to leading European banks, having the
Index Maturity specified on the face hereof, commencing on the
applicable Interest Reset Date and in a principal amount not less
than the equivalent of $1 million in Euros that is representative
for a single transaction in Euros in the market at that time. If
the banks so selected by the Calculation Agent are not quoting as
mentioned above, EURIBOR will be EURIBOR in effect on the
applicable EURIBOR Interest Determination Date; provided that if
no EURIBOR is then in effect, the interest rate that will be
effective as of the next Interest Reset Date will be the Initial
Interest Rate.
"Euro-zone" means the region comprised of member states of the
European Union that have adopted the single currency in
accordance with the Treaty Establishing the European Community,
as amended by the Treaty on European Union.
(J) Prime Rate Notes. If the Interest Rate Basis is the Prime Rate, the
Notes shall be deemed to be "Prime Rate Notes." Prime Rate Notes will
bear interest for each Interest Reset Date calculated with reference
to the Prime Rate and the Spread or Spread Multiplier, if any, subject
to the Minimum Interest Rate and/or Maximum Interest Rate, if any,
specified on the face hereof. The Calculation Agent will determine the
Prime Rate for each Interest Reset Date on each applicable Interest
Determination Date. The Interest Determination Date is the Business
Day immediately preceding the related Interest Reset Date.
"Prime Rate" means: (1) the rate on the particular Interest
Determination Date as published in H.15(519) under the caption
"Bank Prime Loan"; or (2) if the rate referred to in clause (1)
is not so published by 3:00 P.M., New York City time, on the
related Calculation Date, the rate on the particular Interest
Determination Date as published in H.15 Daily Update, or such
other recognized electronic source used for the purpose of
displaying the applicable rate, under the caption "Bank Prime
Loan"; or (3) if the rate referred to in clause (2) is not so
published by 3:00 P.M., New York City time, on the related
Calculation Date, the rate on the particular Interest
Determination Date calculated by the Calculation Agent as the
arithmetic mean of the rates of interest publicly announced by
each bank that appears on the Reuters Screen US PRIME 1 Page (as
defined below) as the applicable bank's prime rate or base
lending rate as of 11:00 A.M., New York City time, on that
Interest Determination Date; or (4) if fewer than four rates
referred to in clause (3) are so published by 3:00 P.M., New York
City time, on the related Calculation Date, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent as the arithmetic mean of the prime rates or
base lending rates quoted on the basis of the actual number of
days in the year divided by a 360-day year as of the close of
business on that Interest Determination Date by three major banks
(which may include affiliates of the Agents) in The City of New
York selected by the
16
Calculation Agent; or (5) if the banks so selected by the
Calculation Agent are not quoting as mentioned in clause (4), the
Prime Rate in effect on the particular Interest Determination
Date; provided that if no Prime Rate is then in effect, the
interest rate that will be effective as of the next Interest
Reset Date will be the Initial Interest Rate.
"Reuters Screen US PRIME 1 Page" means the display on the Reuter
Monitor Money Rates Service (or any successor service) on the "US
PRIME 1" page (or any other page as may replace that page on that
service) for the purpose of displaying prime rates or base
lending rates of major United States banks.
(K) Treasury Rate Notes. If the Interest Rate Basis is the Treasury Rate,
the Notes shall be deemed to be "Treasury Rate Notes." Treasury Rate
Notes will bear interest for each Interest Reset Date at the interest
rate calculated with reference to the Treasury Rate and the Spread or
Spread Multiplier, if any. The Calculation Agent will determine the
Treasury Rate on each Treasury Rate Determination Date (as defined
below).
"Treasury Rate" means: (1) the rate from the auction held on the
Treasury Rate Interest Determination Date (the "Auction") of
direct obligations of the United States ("Treasury Bills") having
the Index Maturity specified on the face hereof under the caption
"INVESTMENT RATE" on the display on Moneyline Telerate (or any
successor service) on page 56 (or any other page as may replace
that page on that service) ("Moneyline Telerate Page 56") or page
57 (or any other page as may replace that page on that service)
("Moneyline Telerate Page 57"); or (2) if the rate referred to in
clause (1) is not so published by 3:00 P.M., New York City time,
on the related Calculation Date, the Bond Equivalent Yield (as
defined below) of the rate for the applicable Treasury Bills as
published in H.15 Daily Update, or another recognized electronic
source used for the purpose of displaying the applicable rate,
under the caption "U.S. Government Securities/Treasury
Bills/Auction High"; or (3) if the rate referred to in clause (2)
is not so published by 3:00 P.M., New York City time, on the
related Calculation Date, the Bond Equivalent Yield of the
auction rate of the applicable Treasury Bills as announced by the
United States Department of the Treasury; or (4) if the rate
referred to in clause (3) is not so announced by the United
States Department of the Treasury, or if the Auction is not held,
the Bond Equivalent Yield of the rate on the particular Interest
Determination Date of the applicable Treasury Bills as published
in H.15(519) under the caption "U.S. Government
Securities/Treasury Bills/Secondary Market"; or (5) if the rate
referred to in clause (4) is not so published by 3:00 P.M., New
York City time, on the related Calculation Date, the rate on the
particular Interest Determination Date of the applicable Treasury
Bills as published in H.15 Daily Update, or another recognized
electronic source used for the purpose of displaying the
applicable rate, under the caption "U.S. Government
Securities/Treasury Bills/Secondary Market"; or (6) if the rate
referred to in clause (5) is not so published by 3:00 P.M., New
York City time, on the related Calculation Date, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent as the Bond Equivalent Yield of the arithmetic
mean of the secondary market bid rates, as of approximately 3:30
P.M., New York City time, on that Interest Determination Date, of
three primary United States government securities dealers (which
may include the Agents or their affiliates) selected by the
Calculation Agent, for the issue of Treasury Bills with a
remaining maturity closest to the Index Maturity specified on the
face hereof; or (7) if the dealers so selected by the Calculation
Agent are not quoting as mentioned in clause (6), the Treasury
Rate in effect on the particular Interest Determination Date;
provided that if no Treasury Rate is then in effect, the interest
rate that will be effective as of the next Interest Reset Date
will be the Initial Interest Rate.
"Bond Equivalent Yield" means a yield (expressed as a percentage)
calculated in accordance with the following formula:
17
Bond Equivalent Yield = D x N x 100
--------------------------
360 - (D x M)
where "D" refers to the applicable per annum rate for Treasury
Bills quoted on a bank discount basis and expressed as a decimal,
"N" refers to 365 or 366, as the case may be, and "M" refers to
the actual number of days in the applicable Interest Period.
The "Treasury Rate Determination Date" for each Interest Reset
Date means the day in the week in which the related Interest
Reset Date falls on which day Treasury Bills are normally
auctioned (i.e., Treasury Bills are normally sold at auction on
Monday of each week, unless that day is a legal holiday, in which
case the auction is normally held on the following Tuesday,
except that the auction may be held on the preceding Friday);
provided, however, that if an auction is held on the Friday of
the week preceding the related Interest Reset Date, the Interest
Determination Date will be the preceding Friday.
(L) Regular Floating Rate Notes. Unless the Notes are designated as
Floating Rate/Fixed Rate Notes or Inverse Floating Rate Notes, or as
having an Addendum attached or having other/additional provisions
apply, in each case relating to a different interest rate formula,
such Notes that bear interest at floating rates will be Regular
Floating Rate Notes and will bear interest at the rate determined by
reference to the applicable Interest Rate Basis or Bases plus or minus
the applicable Spread, if any, and/or multiplied by the applicable
Spread Multiplier, if any. Commencing on the first Interest Reset
Date, as specified on the face hereof, the rate at which interest on
Regular Floating Rate Notes is payable will be reset as of each
Interest Reset Date; provided, however, that the interest rate in
effect for the period, if any, from the date of issue to the first
Interest Reset Date will be the Initial Interest Rate.
(M) Floating Rate/Fixed Rate Notes. If the Notes are designated as
"Floating Rate/Fixed Rate Notes" on the face hereof, such Notes that
bear interest at floating rates will bear interest at the rate
determined by reference to the applicable Interest Rate Basis or Bases
plus or minus the applicable Spread, if any, and/or multiplied by the
applicable Spread Multiplier, if any. Commencing on the first Interest
Reset Date, the rate at which interest on Floating Rate/Fixed Rate
Notes is payable will be reset as of each Interest Reset Date;
provided, however, that the interest rate in effect for the period, if
any, from the date of issue to the first Interest Reset Date will be
the Initial Interest Rate, as specified on the face hereof; and the
interest rate in effect commencing on the Fixed Rate Commencement Date
will be the Fixed Interest Rate, if specified on the face hereof, or,
if not so specified, the interest rate in effect on the day
immediately preceding the Fixed Rate Commencement Date.
(N) Inverse Floating Rate Notes. If the Notes are designated as "Inverse
Floating Rate Notes" on the face hereof, the Inverse Floating Rate
shall be equal to the Fixed Interest Rate minus the rate determined by
reference to the applicable Interest Rate Basis or Bases plus or minus
the applicable Spread, if any, and/or multiplied by the applicable
Spread Multiplier, if any; provided, however, that interest on Inverse
Floating Rate Notes will not be less than zero. Commencing on the
first Interest Reset Date, the rate at which interest on Inverse
Floating Rate Notes is payable will be reset as of each Interest Reset
Date; provided, however, that the interest rate in effect for the
period, if any, from the date of issue to the first Interest Reset
Date will be the Initial Interest Rate.
SECTION 4. Optional Redemption. Except in the case of Discount Notes, if an
Initial Redemption Date is specified on the face hereof, the Trust may redeem
the Notes prior to the Stated Maturity Date at its option on any Business Day on
or after the Initial Redemption Date in whole or from time to time in part in
increments of $1,000 or any other integral multiple of an authorized
denomination specified on the face hereof (provided that any remaining principal
amount of the Notes shall be at least $1,000 or other minimum authorized
denomination applicable thereto), at the applicable Redemption Price (as defined
below), together with unpaid interest accrued on the Notes, any Additional
Amounts and other amounts payable with respect thereto to the date of
redemption. The Trust must give written notice to the Holders of the Notes to be
redeemed at its option not more than 60 nor
18
less than 30 calendar days prior to the date of redemption. "Redemption Price"
means an amount equal to the Initial Redemption Percentage specified on the face
hereof (as adjusted by the Annual Redemption Percentage Reduction, if
applicable) multiplied by the unpaid principal amount of Notes represented by
this Note Certificate to be redeemed. The Initial Redemption Percentage, if any,
shall decline at each anniversary of the Initial Redemption Date by an amount
equal to the applicable Annual Redemption Percentage Reduction, if any, until
the Redemption Price is equal to 100% of the unpaid amount thereof to be
redeemed.
SECTION 5. Sinking Funds and Amortizing Notes. Unless otherwise specified
on the face hereof or unless the Notes are Amortizing Notes, the Notes will not
be subject to any sinking fund. If it is specified on the face hereof that the
Notes are Amortizing Notes, the Trust will make payments combining principal and
interest on the dates and in the amounts set forth in the table appearing in
Schedule I, attached to this Note Certificate. If the Notes are Amortizing
Notes, payments made on the Notes will be applied first to interest due and
payable on each such payment date and then to the reduction of the unpaid
principal amount.
SECTION 6. Optional Repayment. If so specified on the face hereof, the
Notes will be subject to repayment by the Trust at the option of the Holder of
the Notes on the Optional Repayment Date(s) specified on the face hereof, in
whole or in part in increments of U.S.$1,000 (provided that any remaining
principal amount of the Notes shall be at least U.S.$1,000), at a repayment
price equal to 100% of the unpaid principal amount of the Notes to be repaid,
together with unpaid interest accrued thereon to the Repayment Date (as defined
below). For the Notes to be so repaid, the Indenture Trustee must receive at its
corporate trust office not more than 60 nor less than 30 calendar days prior to
the applicable Optional Repayment Date, a properly completed Option to Elect
Repayment form, which is attached hereto as Annex A, forwarded by the Holder
hereof. Exercise of such repayment option shall be irrevocable. As used herein,
the term "Repayment Date" shall mean the date fixed for repayment in accordance
with the repayment provisions specified above.
SECTION 7. Registration, Transfer And Exchange. As provided in the Standard
Indenture Terms and subject to certain limitations therein and herein set forth,
the transfer of the Notes represented by this Note Certificate is registrable in
the records of the Registrar. Upon surrender of this Note Certificate for
registration of transfer at the office or agency of the Trust in any place where
the principal of and interest on the Notes are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Trust and the Registrar duly executed by, the Holder or by his or her attorney
duly authorized in writing, and thereupon one or more new Note Certificates
having the same terms and provisions, in authorized denominations and for the
same aggregate principal amount, will be issued by the Trust to the designated
transferee or transferees.
As provided in the Standard Indenture Terms and subject to certain
limitations therein and herein set forth, the Notes represented by this Note
Certificate are exchangeable for a like aggregate principal amount of Notes in
authorized denominations but otherwise having the same terms and provisions, as
requested by the Holder of this Note Certificate surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Trust or Indenture Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
Prior to due presentment of this Note Certificate for registration of
transfer, the Trust, the Indenture Trustee and any agent of the Trust or the
Indenture Trustee may treat the Holder as the owner of the Notes for all
purposes, including receiving payment of principal of and interest on the Notes,
whether or not the Notes be overdue, and neither the Trust, the Indenture
Trustee nor any such agent shall be affected by notice to the contrary, except
as required by law.
SECTION 8. Certificated Notes. Under certain circumstances described in the
Standard Indenture Terms, the Trust will issue Certificated Notes in exchange
for the Book-Entry Notes represented by a Global Security. The Certificated
Notes issued in exchange for any Book-Entry Notes represented by a Global
Security shall be of like tenor and of an equal aggregate principal amount, in
authorized denominations. Such Certificated Notes shall be registered in the
name or names of such person or persons as the Depositary shall instruct the
Registrar.
19
SECTION 9. Modifications and Amendments. Sections 9.1 and 9.2 of the
Standard Indenture Terms contain provisions permitting the Trust and the
Indenture Trustee (1) without the consent of any Holder, to execute Supplemental
Indentures for limited purposes and take other actions set forth in the Standard
Indenture Terms, and (2) with the consent of the Holders of not less than
66(2)/3% in aggregate principal amount of Notes at the time outstanding,
evidenced as in the Standard Indenture Terms, to execute Supplemental Indentures
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Indenture or any Supplemental Indenture or modifying in any
manner the rights of the Holders of the Notes subject to specified limitations.
SECTION 10. Obligations Unconditional. No reference herein to the Indenture
or to the Standard Indenture Terms and no provision of the Notes or of the
Indenture shall alter or impair the obligation of the Trust, which is absolute
and unconditional, to pay the principal of, interest on, or any other amount due
and owing with respect to, the Notes at the places, at the respective times, at
the rate, and in the coin or currency, herein prescribed.
SECTION 11. Collateral. Pursuant to the Indenture, the Trust will grant a
security interest in, pledge and collaterally assign the Collateral specified on
the face hereof to the Indenture Trustee on behalf of the holders of the Notes
and any other person for whose benefit the Indenture Trustee is or will be
holding the Collateral. The Notes will be secured by a first priority perfected
security interest in the Collateral in favor of the Indenture Trustee and the
other persons identified in the Standard Indenture Terms.
SECTION 12. Security; Limited Recourse. The Notes are solely the
obligations of the Trust, and will not be guaranteed by any person, including
but not limited to Allstate Life, Allstate Life Global Funding, any Agent, the
Trust Beneficial Owner, the Delaware Trustee, the Indenture Trustee or any of
their affiliates. The Trust's obligations under the Notes will be secured by all
of the Trust's rights and title in one or more Funding Agreement(s) issued by
Allstate Life and other rights and assets included in the applicable Collateral.
The Holder of the Notes has no direct contractual rights against Allstate Life
under the Funding Agreement(s). Under the terms of each Funding Agreement,
recourse rights to Allstate Life will belong to the Trust, its successors and
permitted assignees. The Trust has pledged, collaterally assigned and granted a
first priority perfected security interest in the Collateral for the Notes to
the Indenture Trustee on behalf of the Holders of the Notes and the other
persons identified in the Standard Indenture Terms. Recourse to Allstate Life
under each Funding Agreement will be enforceable only by the Indenture Trustee
as a secured party on behalf of the Holders of Notes and the other persons
identified in the Standard Indenture Terms.
SECTION 13. Events of Default. In case an Event of Default, as defined in
the Standard Indenture Terms, shall have occurred and be continuing, the
principal of the Notes may be declared, and upon such declaration shall become,
due and payable in the manner, with the effect and subject to the conditions
provided in the Indenture. If the Notes are Discount Notes, the amount of
principal of the Notes that becomes due and payable upon such acceleration shall
be equal to the amount calculated as set forth in Section 3 hereof.
SECTION 14. Withholding; Additional Amounts; Tax Event. All amounts due in
respect of the Notes will be made without withholding or deduction for or on
account of any present or future taxes, duties, levies, assessments or other
governmental charges of whatever nature imposed or levied by or on behalf of any
governmental authority in the United States having the power to tax payments on
the Notes unless the withholding or deduction is required by law. Unless
otherwise specified on the face hereof, the Trust will not pay any additional
amounts ("Additional Amounts") to Holders of the Notes in the event that any
withholding or deduction is so required by law, regulation or official
interpretation thereof, and the imposition of a requirement to make any such
withholding or deduction will not give rise to any independent right or
obligation to redeem the Notes. If the Trust is required to pay Additional
Amounts pursuant to the applicable provisions of the Standard Indenture Terms
and unless otherwise specified herein, the Trust shall give a notice of
redemption to each Holder of the Notes to be redeemed not more than 75 days nor
less than 30 days prior to the Redemption Date; provided that no such notice of
redemption may be given earlier than 90 days prior to the earliest day on which
the Trust would become obligated to pay the applicable Additional Amounts were a
payment in respect of the Notes then due. Failure to give such notice to the
Holder of any Note designated for redemption in whole or in part, or any defect
in the notice to any such Holder, shall not affect the validity of the
proceedings for the redemption of any other Note or any portion thereof. "Tax
Event" means that the Trust shall have become required at any time to pay
Additional Amounts or if the Trust is obligated to withhold or deduct any United
States taxes with respect to any payment under the Notes or if there is a
material probability that the Trust will become obligated to withhold or deduct
any such United States taxes or
20
otherwise pay Additional Amounts (in the opinion of independent legal counsel
selected by Allstate Life), in each case pursuant to any change in or amendment
to any United States tax laws (or any regulations or rulings thereunder) or any
change in position of the Internal Revenue Service regarding the application or
interpretation thereof (including, but not limited to, Allstate Life's or the
Trust's receipt of a written adjustment from the Internal Revenue Service in
connection with an audit).
SECTION 15. Listing. Unless otherwise specified on the face hereof, the
Notes will not be listed on any securities exchange.
SECTION 16. No Recourse Against Certain Persons. No recourse shall be had
for the payment of the principal of or the interest on the Notes, or for any
claim based hereon, or otherwise in respect thereof, or based on or in respect
of the Indenture or any Supplemental Indenture, against the Nonrecourse Parties,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such personal
liability being, by the acceptance of any Notes and as part of the consideration
for issue of the Notes, expressly waived and released.
SECTION 17. Governing Law. Pursuant to Section 5-1401 of the General
Obligations Law of the State of New York, the Notes shall be governed by, and
construed in accordance with, the laws of the State of New York.
21
ANNEX A
OPTION TO ELECT REPAYMENT
The undersigned beneficial owner of the Notes hereby irrevocably elects
to have the Trust repay the principal amount of the Notes or portion hereof at
the optional repayment price in accordance with the terms of the Notes.
Date:
--------------------------
Signature
Sign exactly as name
appears on the front
of this Note
Certificate [SIGNATURE
GUARANTEED--required
only if Notes are to
be issued and
delivered to other
than the registered
Holder]
Fill in for
registration of Notes
if to be issued
otherwise than to the
registered Holder:
Principal amount to be repaid, if amount to be
repaid is less than the principal amount of the
Notes represented by this Note Certificate
(principal amount remaining must be an
authorized denomination)
$
------------------------------
Name:
-------------------------------------
Address:
----------------------------------------
(Please print name and address
including zip code)
Social Security or Other Taxpayer ID Number
A-1
SCHEDULE I
AMORTIZATION TABLE
Date Payment
------------------------- ---------------
I-1
EXHIBIT 4.9
FORM OF DEFINITIVE SECURITY FOR
SECURED MEDIUM TERM NOTES PROGRAM
[FACE OF DEFINITIVE SECURITY]
Unless this Note Certificate is presented by the holder (as defined in the
standard indenture terms) or an authorized representative of the holder to the
trust (hereinafter defined) or its agent for registration of transfer, exchange
or payment, any transfer, pledge or other use hereof for value or otherwise by
or to any person is wrongful inasmuch as the registered holder hereof has an
interest herein.
This Note Certificate is a definitive security within the meaning of the
standard indenture terms (hereinafter defined) and is registered in the name of
the holder hereof. This Note Certificate is not exchangeable for a global
security (as defined in the standard indenture terms).
CUSIP No.:
ISIN:
Common Code:
ALLSTATE LIFE GLOBAL FUNDING TRUST
SECURED MEDIUM TERM NOTES
Title of Notes: Stated Maturity Date:
Principal Amount: $ Securities Exchange Listing: [ ] Yes [ ] No. If yes,
(or principal amount of foreign or composite currency) indicate name(s) of Securities Exchange(s):
Original Issue Date:
Issue Price:
Interest Rate or Formula:
Fixed Rate Notes: [ ] Yes [ ] No. If yes, Floating Rate Notes: [ ] Yes [ ] No. If yes,
Interest Rate: Regular Floating Rate Notes: [ ]
Interest Payment Dates: Floating Rate/Fixed Rate Notes: [ ]
Day Count Convention: Inverse Floating Rate Notes: [ ]
Additional/Other Terms: Interest Rate:
Amortizing Notes: [ ] Yes [ ] No. If yes, Interest Rate Basis(es):
Amortization Schedule: CD Rate [ ]
Additional/Other Terms: CMT Rate [ ]
Discount Notes: [ ] Yes [ ] No. If yes, Commercial Paper Rate [ ]
Total Amount of Discount: Constant Maturity Swap Rate [ ]
Initial Accrual Period of Discount: Eleventh District Cost of Funds Rate [ ]
Additional/Other Terms: Federal Funds Open Rate [ ]
Redemption Provisions: [ ] Yes [ ] No. If yes, Federal Funds Rate [ ]
Initial Redemption Date: LIBOR [ ]
Initial Redemption Percentage: EURIBOR [ ]
Annual Redemption Percentage Reduction, if any: Prime Rate [ ]
Additional/Other Terms: Treasury Rate [ ]
Repayment Provisions: [ ] Yes [ ] No. If yes, If LIBOR:
Optional Repayment Date(s): [ ] LIBOR Moneyline Telerate:
Optional Repayment Price: [ ] LIBOR Reuters:
Additional/Other Terms: LIBOR Currency:
Regular Interest Record Date(s): If CMT Rate:
Sinking Fund, if any: Designated CMT Moneyline Telerate Page:
Specified Currency: If CMT Moneyline Telerate Page 7052:
Exchange Rate Agent: [ ] Weekly Average
Calculation Agent: [ ] Monthly Average
Depositary: Designated CMT Maturity Index:
Authorized Denominations: Index Maturity:
Collateral: The right, title and interest of the Trust in
and to: Spread (+/-), if any:
(i) Allstate Life Insurance Company Funding Spread Multiplier, if any:
Agreement No(s). [ ]; (ii) all proceeds in respect of
such Funding Agreement(s); and (iii) all books and Initial Interest Rate, if any:
records (including, without limitation, computer programs, Initial Interest Reset Date:
printouts, and other computer materials and files) Interest Reset Dates:
pertaining to such Funding Agreement(s). Interest Determination Date(s):
Interest Payment Dates:
Additional Amounts to be Paid for Withholding Tax: Maximum Interest Rate, if any:
[ ] Yes [ ] No Minimum Interest Rate, if any:
Fixed Rate Commencement Date, if any:
Floating Interest Rate, if any:
Fixed Interest Rate, if any:
Day Count Convention:
Additional/Other Terms:
This Note Certificate is a Definitive Security in respect of a duly
authorized issue of Notes (the "Notes") of the Allstate Life Global Funding
Trust designated above, a statutory trust organized under the laws of the State
of Delaware (the "Trust"). The Notes are issued under the Indenture, dated as of
the date hereof (as amended or supplemented from time to time, the "Indenture")
among the Trust and the other persons specified therein. Capitalized terms used
herein and not otherwise defined shall have the respective meanings ascribed in
the Standard Indenture Terms, which are incorporated by reference in and form a
part of the Indenture (as amended or supplemented from time to time, the
"Standard Indenture Terms").
The Trust, for value received, hereby promises to pay to the Holder hereof
or its registered assigns, on the Stated Maturity Date (or on the date of
redemption or repayment by the Trust prior to maturity pursuant to redemption or
repayment provisions, in each case, if provided for above) the principal amount
specified above and, if so specified above, to pay interest from time to time on
the Notes represented by this Note Certificate from the Original Issue Date
specified above (the "Original Issue Date") or from the most recent Interest
Payment Date to which interest has been paid or duly provided for at the rate
per annum determined in accordance with the provisions on the reverse hereof and
as specified above, until the principal of the Notes represented by this Note
Certificate is paid or made available for payment and to pay such other amounts
due and owing with respect to the Notes represented by this Note Certificate.
On any exchange or purchase and cancellation of any of the Notes
represented by this Note Certificate, details of such exchange or purchase and
cancellation shall be entered in the records of the Indenture Trustee. Upon any
such exchange or purchase and cancellation, the principal amount of the Notes
represented by this Note Certificate shall be charged by the principal amount so
exchanged or purchased and cancelled, as provided in the Standard Indenture
Terms.
Unless otherwise set forth above, if the Notes are subject to an Annual
Redemption Percentage Reduction as specified above, the Redemption Price of the
Notes represented by this Note Certificate shall initially be the Initial
2
Redemption Percentage of the principal amount of the Notes represented by this
Note Certificate on the Initial Redemption Date and shall decline at each
anniversary of the Initial Redemption Date (each such date, a "Redemption Date")
by the Annual Redemption Percentage Reduction of such principal amount until the
Redemption Price is 100% of such principal amount.
The Notes will mature on the Stated Maturity Date, unless their principal
(or, any installment of their principal) becomes due and payable prior to the
Stated Maturity Date, whether, as applicable, by the declaration of acceleration
of maturity, notice of redemption at the option of the Trust, notice of the
Holder's option to elect repayment or otherwise (the Stated Maturity Date or any
date prior to the Stated Maturity Date on which the Notes become due and
payable, as the case may be, are referred to as the "Maturity Date" with respect
to principal of the Notes repayable on such date).
Unless otherwise provided above and except as provided in the following
paragraph, the Trust will pay interest on each Interest Payment Date specified
above, commencing with the first Interest Payment Date next succeeding the
Original Issue Date, and on the Maturity Date; provided that any payment of
principal, premium, if any, interest or other amounts to be made on any Interest
Payment Date or on a Maturity Date that is not a Business Day shall be made in
accordance with the provisions set forth on the reverse hereof.
Unless otherwise specified above, the interest payable on each Interest
Payment Date or on the Maturity Date will be the amount equal to the interest
accrued from and including the immediately preceding Interest Payment Date in
respect of which interest has been paid or from and including the date of issue,
if no interest has been paid, to but excluding the applicable Interest Payment
Date or the Maturity Date, as the case may be (each, an "Interest Period").
Reference is hereby made to the further provisions of the Notes set forth
on the reverse hereof and, if so specified on the face hereof, in an Addendum
hereto, which further provisions shall for all purposes have the same force and
effect as if set forth on the face hereof.
Notwithstanding the foregoing, if an Addendum is attached hereto or
"Other/Additional Provisions" apply to the Notes as specified above, the Notes
shall be subject to the terms set forth in such Addendum or such
"Other/Additional Provisions."
The Notes represented by this Note Certificate shall not be valid or become
obligatory for any purpose until the certificate of authentication hereon shall
have been executed by the Indenture Trustee pursuant to the Indenture.
3
IN WITNESS WHEREOF, the Trust has caused this instrument to be duly
executed on its behalf.
Dated: Original Issue Date THE ALLSTATE LIFE GLOBAL FUNDING TRUST SPECIFIED ON THE
FACE OF THIS NOTE CERTIFICATE,
as Issuer
By: [WILMINGTON TRUST COMPANY],
not in its individual capacity,
but solely as Delaware Trustee
By:
------------------------------------------------------
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This Note Certificate is one of the Note Certificates representing
Notes described in the within-mentioned Indenture.
Dated: Original Issue Date [J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION],
as Indenture Trustee
By:
------------------------------------------------------
Authorized Signatory
4
[REVERSE OF DEFINITIVE SECURITY]
SECTION 1. General. This Note Certificate is a Definitive Security in
respect of a duly authorized issue of Notes of the Trust. The Notes are issued
pursuant to the Indenture.
SECTION 2. Currency. The Notes are denominated in, and payments of
principal of, premium, if any, and interest on, if any, and other amounts in
respect of, the Notes will be in the Specified Currency designated on the face
hereof. If the Notes are Foreign Currency Notes, any amounts so payable by the
Trust in the Specified Currency will be converted by the exchange rate agent
designated on the face hereof (the "Exchange Rate Agent") into United States
dollars for payment to the registered holders hereof unless otherwise specified
on the face hereof or a registered holder elects, in the manner described below,
to receive payments in the Specified Currency.
If the Specified Currency for Foreign Currency Notes is not available for
any required payment of principal, premium, if any, and/or interest, if any, due
to the imposition of exchange controls or other circumstances beyond the control
of the Trust, the Trust will be entitled to satisfy the obligations to the
registered holders of such Foreign Currency Notes by making payments in United
States dollars based on the highest bid quotation in The City of New York
received by the Exchange Rate Agent at approximately 11:00 A.M., New York City
time, on the second Business Day preceding the applicable payment date from
three recognized foreign exchange dealers (one of whom may be the Exchange Rate
Agent) selected by the Exchange Rate Agent and approved by the Trust for the
purchase by the quoting dealer of the Specified Currency for United States
dollars for settlement on that payment date in the aggregate amount of the
Specified Currency payable to all registered holders of such Foreign Currency
Notes scheduled to receive United States dollar payments and at which the
applicable dealer commits to execute a contract. All currency exchange costs
will be borne by the relevant registered holders of such Foreign Currency Notes
by deductions from any payments. If three bid quotations are not available,
payments will be made in the Specified Currency.
Registered holders of Foreign Currency Notes may elect to receive all or a
specified portion of any payment of principal, premium, if any, and/or interest,
if any, in the Specified Currency by submitting a written request to the
Indenture Trustee at its corporate trust office in The City of New York on or
prior to the applicable Regular Interest Record Date or at least fifteen
calendar days prior to the Maturity Date, as the case may be. This written
request may be mailed or hand delivered or sent by cable, telex or other form of
facsimile transmission. This election will remain in effect until revoked by
written notice delivered to the Indenture Trustee on or prior to a Regular
Interest Record Date or at least fifteen calendar days prior to the Maturity
Date, as the case may be. Registered holders of Foreign Currency Notes to be
held in the name of a broker or nominee should contact their broker or nominee
to determine whether and how an election to receive payments in the Specified
Currency may be made.
Unless otherwise specified on the face hereof, if the Specified Currency is
other than United States dollars, if the Holder hereof elects to receive
payments of principal, premium, if any, and/or interest, if any, in the
Specified Currency, the Holder must notify the Indenture Trustee of that
election on or prior to the fifth Business Day after the applicable Regular
Interest Record Date or at least ten calendar days prior to the Maturity Date,
as the case may be. If complete instructions are received by the Indenture
Trustee on or prior to such dates, then the Holder will receive payments in the
Specified Currency.
Unless otherwise specified on the face hereof, if payment in the Specified
Currency hereon is not available to the Trust for any required payment of
principal, premium, if any, and/or interest, if any, due to the imposition of
exchange controls or other circumstances beyond the Trust's control, then the
Trust will be entitled to satisfy its obligations by making payments in United
States dollars on the basis of the Market Exchange Rate, computed by the
Exchange Rate Agent as described above, on the second Business Day prior to the
particular payment or, if the Market Exchange Rate is not then available, on the
basis of the most recently available Market Exchange Rate. The "Market Exchange
Rate" for a Specified Currency other than United States dollars means the noon
dollar buying rate in The City of New York for cable transfers for the Specified
Currency as certified for customs purposes (or, if not so certified, as
otherwise determined) by the Federal Reserve Bank of New York. Any payment in
respect hereof made under such circumstances in U.S. Dollars will not constitute
an Event of Default under the Indenture.
In the event that a member state of the European Union in whose national
currency is the Specified Currency becomes a participant member in the third
5
stage of the European economic and monetary union, the Trust may on or after the
date of such occurrence, without the consent of the Holder hereof, redenominate
all, but not less than all, of the Notes hereof.
All determinations referred to above made by the Exchange Rate Agent shall
be at its sole discretion and, in the absence of manifest error, shall be
conclusive for all purposes and binding on the Holder hereof and any applicable
Entitlement Holders.
All currency exchange costs will be borne by the Holder hereof by deduction
from the payments made hereon.
SECTION 3. Determination of Interest Rate and Other Payment Provisions.
Fixed Rate Notes. If the Notes are designated on the face hereof as "Fixed
Rate Notes," the Notes will bear interest from the Original Issue Date until the
Maturity Date. Unless otherwise specified on the face hereof, the rate of
interest payable on the Notes will not be adjusted; unless otherwise specified
on the face hereof, interest will be payable on the Interest Payment Dates set
forth on the face hereof and at the Maturity Date. Interest will be computed on
the basis of a 360-day year of twelve 30-day months. If any Interest Payment
Date or the Maturity Date of Fixed Rate Notes falls on a day that is not a
Business Day, any payments of principal, premium, if any, and/or interest or
other amounts required to be made, will be made on the next succeeding Business
Day, and no additional interest will accrue in respect of the payment made on
that next succeeding Business Day.
Discount Notes. If the Notes are designated on the face hereof as "Discount
Notes" (as defined below), payments in respect of the Notes shall be made as set
forth on the face hereof. In the event a Discount Note is redeemed, repaid or
accelerated, the amount payable to the Holder of such Note will be equal to the
sum of: (1) the Issue Price (increased by any accruals of discount) and, in the
event of any redemption of such Discount Notes, if applicable, multiplied by the
Initial Redemption Percentage (as adjusted by the Annual Redemption Percentage
Reduction, if applicable); and (2) any unpaid interest accrued on such Discount
Notes to the date of redemption, repayment or acceleration of maturity, as
applicable. For purposes of determining the amount of discount that has accrued
as of any date on which a redemption, repayment or acceleration of maturity of
the Notes occurs for Discount Notes, the discount will be accrued using a
constant yield method. The constant yield will be calculated using a 30-day
month, 360-day year convention, a compounding period that, except for the
Initial Period (as defined below), corresponds to the shortest period between
Interest Payment Dates for Discount Notes (with ratable accruals within a
compounding period), a coupon rate equal to the initial coupon rate applicable
to Discount Notes and an assumption that the maturity of such Discount Notes
will not be accelerated. If the period from the date of issue to the first
Interest Payment Date for Discount Notes (the "Initial Period") is shorter than
the compounding period for such Discount Notes, a proportionate amount of the
yield for an entire compounding period will be accrued. If the Initial Period is
longer than the compounding period, then the period will be divided into a
regular compounding period and a short period with the short period being
treated as provided in the preceding sentence. The accrual of the applicable
discount may differ from the accrual of original issue discount for purposes of
the Code, certain Discount Notes may not be treated as having original issue
discount within the meaning of the Code, and certain Notes other than Discount
Notes may be treated as issued with original issue discount for federal income
tax purposes. A "Discount Note" is any Note that has an Issue Price that is less
than 100% of the principal amount thereof by more than a percentage equal to the
product of 0.25% and the number of full years to the Stated Maturity Date. A
Discount Note may not bear any interest currently or may bear interest at a rate
that is below market rates at the time of issuance.
Amortizing Notes. If the Notes are specified on the face hereof as
"Amortizing Notes," the Notes shall bear interest at the rate set forth on the
face hereof, and payments of principal and interest shall be made as set forth
on the face hereof and/or in accordance with SCHEDULE I attached hereto. Unless
otherwise specified on the face hereof, interest on the Notes will be computed
on the basis of a 360-day year of twelve 30-day months. Payments with respect to
Amortizing Notes will be applied first to interest due and payable on the Notes
and then to the reduction of the unpaid principal amount of Notes represented by
this Note Certificate.
Floating Rate Notes. If the Notes are specified on the face hereof as
"Floating Rate Notes," interest on the Notes shall accrue and be payable in
accordance with this Section 3. A Floating Rate Note may be a CD Rate Note, CMT
Rate Note, Commercial Paper Rate Note, Constant Maturity Swap Rate Note,
Eleventh District Cost of Funds Rate Note, Federal Funds Open Rate Note, Federal
Funds Rate Note, LIBOR Note, EURIBOR Note, Prime Rate Note, or Treasury Rate
Note. If the Notes are designated on the face hereof as Floating Rate Notes, the
6
face hereof will specify whether the Notes are Regular Floating Rate Notes,
Inverse Floating Rate Notes or Floating Rate/Fixed Rate Notes. For the period
from the date of issue to, but not including, the first Interest Reset Date set
forth on the face hereof, the interest rate hereon shall be the Initial Interest
Rate specified on the face hereof. Thereafter, the interest rate hereon will be
reset as of and be effective as of each Interest Reset Date.
(A) If any Interest Reset Date would otherwise be a day that is not a
Business Day, such Interest Reset Date shall be postponed to the next
day that is a Business Day; provided, however, that if the Notes are
LIBOR Notes or EURIBOR Notes and such Business Day is in the next
succeeding calendar month, such Interest Reset Date shall be the
Business Day immediately preceding such Interest Reset Date.
(B) Unless specified otherwise on the face hereof, Interest Reset Dates
are as follows: (1) if the Notes reset daily, each Business Day; (2)
if the Notes reset weekly, other than Treasury Rate Notes, the
Wednesday of each week; (3) if the Notes are Treasury Rate Notes that
reset weekly, and except as provided below under "Treasury Rate
Notes," the Tuesday of each week; (4) if the Notes reset monthly, the
third Wednesday of each month, unless the Eleventh District Cost of
Funds Rate is the Interest Rate Basis (as defined below) applicable to
the Notes, in which case the Notes will reset the first calendar day
of the month; (5) if the Notes reset quarterly, the third Wednesday of
every third calendar month, beginning in the third calendar month
following the month in which the Notes were issued; (6) if the Notes
reset semiannually, the third Wednesday of each of the two months
specified on the face hereof; and (7) if the Notes reset annually, the
third Wednesday of the month specified on the face hereof; provided,
however, that with respect to Floating Rate/ Fixed Rate Notes, the
rate of interest thereon will not reset after the particular Fixed
Rate Commencement Date specified on the face hereof (the "Fixed Rate
Commencement Date").
(C) Accrued interest is calculated by multiplying the principal amount of
such Floating Rate Note by an accrued interest factor. The accrued
interest factor is computed by adding the interest factor calculated
for each day in the particular Interest Period. The interest factor
for each day will be computed by dividing the interest rate applicable
to such day by 360, in the case of Floating Rate Notes as to which the
CD Rate, the Commercial Paper Rate, the Eleventh District Cost of
Funds Rate, the Federal Funds Open Rate, the Federal Funds Rate,
LIBOR, EURIBOR or the Prime Rate is an applicable Interest Rate Basis,
or by the actual number of days in the year, in the case of Floating
Rate Notes as to which the CMT Rate or the Treasury Rate is an
applicable Interest Rate Basis. In the case of a Floating Rate Note as
to which the Constant Maturity Swap Rate is the Interest Rate Basis,
the interest factor will be computed by dividing the number of days in
the interest period by 360 (the number of days to be calculated on the
basis of a year of 360 days with 12 30-day months (unless (i) the last
day of the interest period is the 31st day of a month but the first
day of the interest period is a day other than the 30th or 31st day of
a month, in which case the month that includes that last day shall not
be considered to be shortened to a 30-day month, or (ii) the last day
of the interest period is the last day of the month of February, in
which case the month of February shall not be considered to be
lengthened to a 30-day month)). The interest factor for Floating Rate
Notes as to which the interest rate is calculated with reference to
two or more Interest Rate Bases will be calculated in each period in
the same manner as if only the applicable Interest Rate Basis
specified on the face hereof applied. The interest rate shall be set
forth on the face hereof. For purposes of making the foregoing
calculation, the interest rate in effect on any Interest Reset Date
will be the applicable rate as reset on that date. Unless otherwise
specified on the face hereof, the interest rate that is effective on
the applicable Interest Reset Date will be determined on the
applicable Interest Determination Date and calculated on the
applicable Calculation Date (as defined below).
"Calculation Date" means the date by which the Calculation Agent
designated on the face hereof, is to calculate the interest rate which
will be the earlier of (1) the tenth calendar day after the particular
Interest Determination Date or, if such day is not a Business Day, the
next succeeding Business Day; or (2) the Business Day immediately
preceding the applicable Interest Payment Date or the Maturity Date,
as the case may be.
7
(D) Unless otherwise specified on the face hereof, all percentages
resulting from any calculation on Floating Rate Notes will be rounded
to the nearest one hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upwards. All dollar
amounts used in or resulting from any calculation on Floating Rate
Notes will be rounded, in the case of United States dollars, to the
nearest cent or, in the case of a foreign currency, to the nearest
unit (with one-half cent or unit being rounded upwards).
(E) Unless otherwise specified on the face hereof, if the Notes are
designated on the face hereof as Floating Rate Notes, if any Interest
Payment Date (other than the Maturity Date for the Notes) would
otherwise be a day that would not be a Business Day, such Interest
Payment Date would be postponed to the next succeeding Business Day;
provided, however, that if the Notes are LIBOR Notes or EURIBOR Notes
and such Business Day is in the next succeeding calendar month, such
Interest Payment Date shall be the immediately preceding Business Day.
Unless otherwise specified on the face hereof, if the Notes are
designated on the face hereof as Floating Rate Notes, if the Maturity
Date of the Notes falls on a day this is not a Business Day, the Trust
will make the required payment of principal, premium, if any, and
interest or other amounts on the next succeeding Business Day, and no
additional interest will accrue in respect of the payment made on that
next succeeding Business Day.
Unless otherwise specified on the face hereof and except as provided below,
interest will be payable as follows: (1) if the Interest Reset Date for the
Notes is daily, weekly or monthly, interest will be payable on the third
Wednesday of each month or on the third Wednesday of every third calendar month,
beginning in the third calendar month following the month in which the Notes
were issued, as specified on the face hereof; (2) if the Interest Reset Date for
the Notes is quarterly, interest will be payable on the third Wednesday of every
third calendar month, beginning in the third calendar month following the month
in which the Notes were issued; (3) if the Interest Reset Date for the Notes is
semiannually, interest will be payable on the third Wednesday of each of two
months of each year specified on the face hereof; or (4) if the Interest Reset
Date for the Notes is annually, interest will be payable on the third Wednesday
of the month of each year specified on the face hereof. In each of these cases,
the Maturity Date will also be an Interest Payment Date.
If specified on the face hereof, the Notes may have either or both of a
Maximum Interest Rate or Minimum Interest Rate. If a Maximum Interest Rate is so
designated, the interest rate that may accrue during any Interest Period for
Floating Rate Notes cannot ever exceed such Maximum Interest Rate and in the
event that the interest rate on any Interest Reset Date would exceed such
Maximum Interest Rate (as if no Maximum Interest Rate were in effect) then the
interest rate on such Interest Reset Date shall be the Maximum Interest Rate. If
a Minimum Interest Rate is so designated, the interest rate that may accrue
during any Interest Period for Floating Rate Notes cannot ever be less than such
Minimum Interest Rate and in the event that the interest rate on any Interest
Reset Date would be less than such Minimum Interest Rate (as if no Minimum
Interest Rate were in effect) then the interest rate on such Interest Reset Date
shall be the Minimum Interest Rate. Notwithstanding anything to the contrary
contained herein, if the Notes are designated on the face hereof as Floating
Rate Notes, the interest rate on Notes shall not exceed the maximum interest
rate permitted by applicable law.
All determinations of interest by the Calculation Agent designated on the
face hereof will, in the absence of manifest error, be conclusive for all
purposes and binding on the Holder of the Notes and neither the Indenture
Trustee nor the Calculation Agent shall have any liability to the Holder of the
Notes in respect of any determination, calculation, quote or rate made or
provided by the Calculation Agent. Upon request of the Holder of the Notes, the
Calculation Agent will provide the interest rate then in effect and, if
determined, the interest rate that will become effective on the next Interest
Reset Date with respect to the Notes. If the Calculation Agent is incapable or
unwilling to act as such or if the Calculation Agent fails duly to establish the
interest rate for any interest accrual period or to calculate the interest
amount or any other requirements, the Trust will appoint a successor to act as
such in its place. The Calculation Agent may not resign its duties until a
successor has been appointed and such successor has accepted its appointment.
Subject to applicable provisions of law and except as specified herein, on
each Interest Reset Date, the rate of interest on the Notes on and after the
first Interest Reset Date shall be the interest rate determined in accordance
8
with the provisions of the heading below which has been designated as the
Interest Rate Basis on the face hereof (the "Interest Rate Basis"), the base
rate, plus or minus the Spread, if any, specified on the face hereof and/or
multiplied by the Spread Multiplier, if any, specified on the face hereof.
(A) CD Rate Notes. If the Interest Rate Basis is the CD Rate, the Notes
shall be deemed to be "CD Rate Notes." CD Rate Notes will bear
interest at the interest rate calculated with reference to the CD Rate
and the Spread or Spread Multiplier, if any. The Calculation Agent
will determine the CD Rate on each Interest Determination Date. The
Interest Determination Date is the second Business Day preceding the
related Interest Reset Date.
"CD Rate" means: (1) the rate on the particular Interest
Determination Date for negotiable United States dollar
certificates of deposit having the Index Maturity specified on
the face hereof as published in H.15(519) (as defined below)
under the caption "CDs (secondary market)"; or (2) if the rate
referred to in clause (1) is not so published by 3:00 P.M., New
York City time, on the related Calculation Date, the rate on the
particular Interest Determination Date for negotiable United
States dollar certificates of deposit of the particular Index
Maturity as published in the H.15 Daily Update (as defined below)
or other recognized electronic source used for the purpose of
displaying the applicable rate under the heading "CDs (secondary
market)"; or (3) if the rate referred to in clause (2) is not yet
published in either H.15(519) or the H.15 Daily Update by 3:00
P.M., New York City time, on the related Calculation Date, then
the CD Rate will be the rate on the particular Interest
Determination Date calculated by the Calculation Agent as the
arithmetic mean of the secondary market offered rates as of 10:00
A.M., New York City time on that Interest Determination Date of
three leading nonbank dealers in negotiable United States dollar
certificates of deposit in The City of New York (which may
include the Agents or their affiliates) selected by the
Calculation Agent for negotiable United States dollar
certificates of deposit of major United States money market banks
for negotiable United States certificates of deposit with a
remaining maturity closest to the particular Index Maturity in an
amount that is representative for a single transaction in that
market at that time; or (4) if the dealers so selected by the
Calculation Agent are not quoting as mentioned in clause (3), the
CD Rate in effect on the particular Interest Determination Date;
provided that if no CD Rate is then in effect, the interest rate
that will be effective as of the next Interest Reset Date will be
the Initial Interest Rate.
"H.15(519)" means the weekly statistical release designated as
H.15(519), or any successor publication, published by the Board
of Governors of the Federal Reserve System.
"H.15 Daily Update" means the daily update of H.15(519),
available through the word-wide-web site of the Board of
Governors of the Federal Reserve System at
http://www.federalreserve.gov/releases/H15/update, or any
successor site or publication.
(B) CMT Rate Notes. If the Interest Basis is the CMT Rate, the Notes shall
be deemed to be "CMT Rate Notes." CMT Rate Notes will bear interest at
the interest rate calculated with reference to the CMT Rate and the
Spread or Spread Multiplier, if any. The Calculation Agent will
determine the CMT Rate on each applicable Interest Determination Date.
The applicable Interest Determination Date is the second Business Day
preceding the Interest Reset Date.
"CMT Rate" means: (1) if CMT Moneyline Telerate Page 7051 is
specified on the face hereof: (a) the percentage equal to the
yield for United States Treasury securities at "constant
maturity" having the Index Maturity specified on the face hereof
as published in H.15(519) under the caption "Treasury Constant
Maturities", as the yield is displayed on Moneyline Telerate (or
any successor service) on page 7051 (or any other page as may
replace the specified page on that service) ("Moneyline Telerate
Page 7051"), for the particular Interest Determination Date; or
(b) if the rate referred to in clause (a) does not so appear on
Moneyline Telerate Page 7051, the percentage equal to the yield
for United States Treasury securities at "constant maturity"
having the particular Index Maturity and for the particular
Interest Determination Date as published in H.15(519) under the
9
caption "Treasury Constant Maturities"; or (c) if the rate
referred to in clause (b) does not so appear in H.15(519), the
rate on the particular Interest Determination Date for the period
of the particular Index Maturity as may then be published by
either the Federal Reserve System Board of Governors or the
United States Department of the Treasury that the Calculation
Agent determines to be comparable to the rate which would
otherwise have been published in H.15(519); or (d) if the rate
referred to in clause (c) is not so published, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent as a yield to maturity based on the arithmetic
mean of the secondary market bid prices at approximately 3:30
P.M., New York City time, on that Interest Determination Date of
three leading primary United States government securities dealers
in The City of New York (which may include the Agents or their
affiliates) (each, a "Reference Dealer"), selected by the
Calculation Agent from five Reference Dealers selected by the
Calculation Agent and eliminating the highest quotation, or, in
the event of equality, one of the highest, and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity equal
to the particular Index Maturity, a remaining term to maturity no
more than one year shorter than that Index Maturity and in a
principal amount that is representative for a single transaction
in the securities in that market at that time; or (e) if fewer
than five but more than two of the prices referred to in clause
(d) are provided as requested, the rate on the particular
Interest Determination Date calculated by the Calculation Agent
based on the arithmetic mean of the bid prices obtained and
neither the highest nor the lowest of the quotations shall be
eliminated; or (f) if fewer than three prices referred to in
clause (d) are provided as requested, the rate on the particular
Interest Determination Date calculated by the Calculation Agent
as a yield to maturity based on the arithmetic mean of the
secondary market bid prices as of approximately 3:30 P.M., New
York City time, on that Interest Determination Date of three
Reference Dealers selected by the Calculation Agent from five
Reference Dealers selected by the Calculation Agent and
eliminating the highest quotation or, in the event of equality,
one of the highest and the lowest quotation or, in the event of
equality, one of the lowest, for United States Treasury
securities with an original maturity greater than the particular
Index Maturity, a remaining term to maturity closest to that
Index Maturity and in a principal amount that is representative
for a single transaction in the securities in that market at that
time; or (g) if fewer than five but more than two prices referred
to in clause (f) are provided as requested, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent based on the arithmetic mean of the bid prices
obtained and neither the highest nor the lowest of the quotations
will be eliminated; or (h) if fewer than three prices referred to
in clause (f) are provided as requested, the CMT Rate in effect
on the particular Interest Determination Date; provided that if
no CMT Rate is then in effect, the interest rate that will be
effective as of the next Interest Reset Date will be the Initial
Interest Rate; (2) if CMT Moneyline Telerate Page 7052 is
specified on the face hereof: (a) the percentage equal to the
one-week or one-month, as specified on the face hereof, average
yield for United States Treasury securities at "constant
maturity" having the Index Maturity specified on the face hereof
as published in H.15(519) opposite the caption "Treasury Constant
Maturities", as the yield is displayed on Moneyline Telerate (or
any successor service) (on page 7052 or any other page as may
replace the specified page on that service) ("Moneyline Telerate
Page 7052"), for the week or month, as applicable, ended
immediately preceding the week or month, as applicable, in which
the particular Interest Determination Date falls; or (b) if the
rate referred to in clause (a) does not so appear on Moneyline
Telerate Page 7052, the percentage equal to the one-week or
one-month, as specified on the face hereof, average yield for
United States Treasury securities at "constant maturity" having
the particular Index Maturity and for the week or month, as
applicable, preceding the particular Interest Determination Date
as published in H.15(519) opposite the caption "Treasury Constant
Maturities"; or (c) if the rate referred to in clause (b) does
not so appear in H.15(519), the one-week or one-month, as
specified on the face hereof, average yield for United States
Treasury securities at "constant maturity" having the particular
Index Maturity as otherwise announced by the Federal Reserve Bank
of New York for the week or month, as applicable, ended
10
immediately preceding the week or month, as applicable, in which
the particular Interest Determination Date falls; or (d) if the
rate referred to in clause (c) is not so published, the rate on
the particular Interest Determination Date calculated by the
Calculation Agent as a yield to maturity based on the arithmetic
mean of the secondary market bid prices at approximately 3:30
P.M., New York City time, on that Interest Determination Date of
three Reference Dealers selected by the Calculation Agent from
five Reference Dealers selected by the Calculation Agent and
eliminating the highest quotation, or, in the event of equality,
one of the highest, and the lowest quotation or, in the event of
equality, one of the lowest, for United States Treasury
securities with an original maturity equal to the particular
Index Maturity, a remaining term to maturity no more than one
year shorter than that Index Maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at that time; or (e) if fewer than five but more
than two of the prices referred to in clause (d) are provided as
requested, the rate on the particular Interest Determination Date
calculated by the Calculation Agent based on the arithmetic mean
of the bid prices obtained and neither the highest nor the lowest
of the quotations shall be eliminated; or (f) if fewer than three
prices referred to in clause (d) are provided as requested, the
rate on the particular Interest Determination Date calculated by
the Calculation Agent as a yield to maturity based on the
arithmetic mean of the secondary market bid prices as of
approximately 3:30 P.M., New York City time, on that Interest
Determination Date of three Reference Dealers selected by the
Calculation Agent from five Reference Dealers selected by the
Calculation Agent and eliminating the highest quotation or, in
the event of equality, one of the highest and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity
greater than the particular Index Maturity, a remaining term to
maturity closest to that Index Maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at the time; or (g) if fewer than five but more
than two prices referred to in clause (f) are provided as
requested, the rate on the particular Interest Determination Date
calculated by the Calculation Agent based on the arithmetic mean
of the bid prices obtained and neither the highest nor the lowest
of the quotations will be eliminated; or (h) if fewer than three
prices referred to in clause (f) are provided as requested, the
CMT Rate in effect on that Interest Determination Date; provided
that if no CMT Rate is then in effect, the interest rate that
will be effective as of the next Interest Reset Date will be the
Initial Interest Rate.
If two United States Treasury securities with an original
maturity greater than the Index Maturity specified on the face
hereof have remaining terms to maturity equally close to the
particular Index Maturity, the quotes for the United States
Treasury security with the shorter original remaining term to
maturity will be used.
(C) Commercial Paper Rate Notes. If the Interest Rate Basis is the
Commercial Paper Rate, the Notes shall be deemed to be "Commercial
Paper Rate Notes." Commercial Paper Rate Notes will bear interest for
each Interest Reset Date at the interest rate calculated with
reference to the Commercial Paper Rate and the Spread or Spread
Multiplier, if any. The Calculation Agent will determine the
Commercial Paper Rate on each applicable Interest Determination Date.
The Interest Determination Date is the second Business Day preceding
the related Interest Reset Date.
"Commercial Paper Rate" means: (1) the Money Market Yield
(calculated as described below) on the Interest Determination
Date of the rate for commercial paper having the applicable Index
Maturity as such rate is published in H.15(519) under the heading
"Commercial Paper--Nonfinancial"; or (2) if the rate referred to
in clause (1) is not published by 3:00 P.M., New York City time,
on the Calculation Date pertaining to such Interest Determination
Date, then the Commercial Paper Rate shall be the Money Market
Yield on the particular Interest Determination Date of the rate
for commercial paper having the particular Index Maturity as
published on H.15 Daily Update or such other recognized
electronic source used for the purpose of displaying the
applicable rate, under the caption "Commercial
Paper--Nonfinancial"; or (3) if the rate referred to in clause
(2) is not published by 3:00 P.M., New York City time, on the
Calculation Date, then the Commercial Paper Rate as calculated by
11
the Calculation Agent shall be the Money Market Yield of the
arithmetic mean of the offered rates at approximately 11:00 A.M.,
New York City time, on that Interest Determination Date of three
leading dealers of United States dollar commercial paper in The
City of New York (which may include the Agents or their
affiliates) selected by the Calculation Agent for commercial
paper having the particular Index Maturity placed for industrial
issuers whose bond rating is "Aa" by Moody's or the equivalent
from another nationally recognized statistical rating
organization; or (4) if the dealers so selected by the
Calculation Agent are not rates as mentioned in clause (3), the
Commercial Paper Rate in effect on the particular Interest
Determination Date; provided that if no Commercial Paper Rate is
then in effect, the interest rate that will be effective as of
the next Interest Reset Date will be the Initial Interest Rate.
"Money Market Yield" shall be a yield (expressed as a percentage)
calculated in accordance with the following formula:
Money Market Yield = D x 360 x 100
------------------
360 - (D x M)
where "D" refers to the per annum rate for the commercial paper,
quoted on a bank discount basis and expressed as a decimal; and
"M" refers to the actual number of days in the applicable
Interest Period.
(D) Constant Maturity Swap Rate Notes. If the Interest Basis is the
Constant Maturity Swap Rate, the Notes shall be deemed to be "Constant
Maturity Swap Rate Notes." Constant Maturity Swap Rate Notes will bear
interest at the interest rate calculated with reference to the
Constant Maturity Swap Rate and the Spread or Spread Multiplier, if
any. The Calculation Agent will determine the Constant Maturity Swap
Rate on each applicable Interest Determination Date. The Interest
Determination Date is the second U.S. Government Securities Business
Day (as defined below) preceding the related Interest Reset Date;
provided, however, that if, after attempting to determine the Constant
Maturity Swap Rate (as described below), such rate is not determinable
for a particular Interest Determination Date (the "Original Interest
Determination Date"), then such Interest Determination Date shall be
the first U.S. Government Securities Business Day preceding the
Original Interest Determination Date for which the Constant Maturity
Swap Rate can be determined as described below.
"Constant Maturity Swap Rate" means: (1) the rate for U.S. Dollar
swaps with the designated maturity specified on the face hereof,
expressed as a percentage, which appears on the Reuters Screen
ISDAFIX1 Page as of 11:00 A.M., New York City time, on the
particular Interest Determination Date; or (2) if the rate
referred to in clause (1) does not appear on the Reuters Screen
ISDAFIX1 Page by 2:00 P.M., New York City time, on such Interest
Determination Date, a percentage determined on the basis of the
mid-market semi-annual swap rate quotations provided by the
Reference Banks (as defined below) as of approximately 11:00
A.M., New York City time, on such Interest Determination Date,
and, for this purpose, the semi-annual swap rate means the mean
of the bid and offered rates for the semi-annual fixed leg,
calculated on a 30/360 day count basis, of a fixed-for-floating
U.S. Dollar interest rate swap transaction with a term equal to
the designated maturity specified in the face hereof commencing
on the Interest Reset Date and in a Representative Amount (as
defined below) with an acknowledged dealer of good credit in the
swap market, where the floating leg, calculated on an Actual/360
day count basis, is equivalent to USD-LIBOR-BBA with a designated
maturity specified on the face hereof. The Calculation Agent will
request the principal New York City office of each of the
Reference Banks to provide a quotation of its rate. If at least
three quotations are provided, the rate for that Interest
Determination Date will be the arithmetic mean of the quotations,
eliminating the highest quotation (or, in the event of equality,
one of the highest) and the lowest quotation (or, in the event of
equality, one of the lowest).
12
"U.S. Government Securities Business Day" means any day except
for Saturday, Sunday, or a day on which The Bond Market
Association recommends that the fixed income departments of its
members be closed for the entire day for purposes of trading in
U.S. government securities.
"Representative Amount" means an amount that is representative
for a single transaction in the relevant market at the relevant
time.
"Reference Banks" mean five leading swap dealers in the New York
City interbank market, selected by the Calculation Agent, after
consultation with Allstate Life Insurance Company ("Allstate
Life").
(E) Eleventh District Cost of Funds Rate Notes. If the Interest Basis is
the Eleventh District Costs of Funds Rate, the Notes shall be deemed
to be "Eleventh District Cost of Funds Rate Notes." Eleventh District
Cost of Funds Notes will bear interest at the interest rate calculated
with reference to the Eleventh District Cost of Funds Rate and the
Spread or Spread Multiplier, if any. The Calculation Agent will
determine the Eleventh District Cost of Rate on each applicable
Interest Determination Date. The applicable Interest Determination
Date is the last working day of the month immediately preceding the
related Interest Reset Date on which the Federal Home Loan Bank of San
Francisco publishes the Eleventh District Index (as defined below).
The "Eleventh District Cost of Funds Rate" means: (1) the rate
equal to the monthly weighted average cost of funds for the
calendar month immediately preceding the month in which the
particular Interest Determination Date falls as set forth under
the caption "11th District" on the display on Moneyline Telerate
(or any successor service) on page 7058 (or any other page as may
replace the specified page on that service) ("Moneyline Telerate
Page 7058") as of 11:00 A.M., San Francisco time, on that
Interest Determination Date; or (2) if the rate referred to in
clause (1) does not so appear on Moneyline Telerate Page 7058,
the monthly weighted average cost of funds paid by member
institutions of the Eleventh Federal Home Loan Bank District that
was most recently announced (the "Eleventh District Index") by
the Federal Home Loan Bank of San Francisco as the cost of funds
for the calendar month immediately preceding that Interest
Determination Date; or (3) if the Federal Home Loan Bank of San
Francisco fails to announce the Eleventh District Index on or
prior to the particular Interest Determination Date for the
calendar month immediately preceding that Interest Determination
Date, the Eleventh District Cost of Funds Rate in effect on the
particular Interest Determination Date; provided that if no
Eleventh District Cost of Funds Rate is then in effect, the
interest rate that will be effective as of the next Interest
Reset Date will be the Initial Interest Rate.
(F) Federal Funds Open Rate Notes. If the Interest Basis is the Federal
Funds Open Rate, the Notes shall be deemed to be "Federal Funds Open
Rate Notes." Federal Funds Open Rate Notes will bear interest at the
interest rate calculated with reference to the Federal Funds Open Rate
and the Spread or Spread Multiplier, if any. The Calculation Agent
will determine the Federal Funds Open Rate on each applicable Interest
Determination Date. The Interest Determination Date is the related
Interest Reset Date.
"Federal Funds Open Rate" means the rate set forth on Moneyline
Telerate Page 5 for an Interest Reset Date underneath the caption
"FEDERAL FUNDS" in the row titled "OPEN". If the rate is not
available for an Interest Reset Date, the rate for that Interest
Reset Date shall be the Federal Funds Rate as determined below.
13
(G) Federal Funds Rate Notes. If the Interest Rate Basis is the Federal
Funds Rate, the Notes shall be deemed to be "Federal Funds Rate
Notes." Federal Funds Rate Notes will bear interest for each Interest
Reset Date at the interest rate calculated with reference to the
Federal Funds Rate and the Spread or Spread Multiplier, if any. The
Calculation Agent will determine the Federal Funds Rate on each
applicable Interest Determination Date. The Interest Determination
Date is the Business Day immediately preceding the related Interest
Reset Date.
"Federal Funds Rate" means: (1) the rate on the particular
Interest Determination Date for United States dollar federal
funds as published in H.15(519) under the caption "Federal Funds
(Effective)" and displayed on Moneyline Telerate (or any
successor service) on page 120 (or any other page as may replace
the specified page on that service) ("Moneyline Telerate Page
120"); or (2) if the rate referred to in clause (1) does not so
appear on Moneyline Telerate Page 120 or is not so published by
3:00 P.M., New York City time, on the related Calculation Date,
the rate on the particular Interest Determination Date for United
States dollar federal funds as published in H.15 Daily Update, or
such other recognized electronic source used for the purpose of
displaying the applicable rate, under the caption "Federal Funds
(Effective)"; or (3) if the rate referred to in clause (2) is not
so published by 3:00 P.M., New York City time, on the related
Calculation Date, the rate on the particular Interest
Determination Date calculated by the Calculation Agent as the
arithmetic mean of the rates for the last transaction in
overnight United States dollar federal funds arranged by three
leading brokers of United States dollar federal funds
transactions in The City of New York (which may include the
Agents or their affiliates), selected by the Calculation Agent
prior to 9:00 A.M., New York City time, on the business day
following that Interest Determination Date; or (4) if the brokers
so selected by the Calculation Agent are not quoting as mentioned
in clause (3), the Federal Funds Rate in effect on the particular
Interest Determination Date; provided that if no Federal Funds
Rate is then in effect, the interest rate that will be effective
as of the next Interest Reset Date will be the Initial Interest
Rate..
(H) LIBOR Notes. If the Interest Rate Basis is LIBOR (as defined below),
the Notes shall be deemed to be "LIBOR Notes." LIBOR Notes will bear
interest for each Interest Period at the interest rate calculated with
reference to LIBOR and the Spread or Spread Multiplier, if any. On
each applicable Interest Determination Date the Calculation Agent will
determine LIBOR. The applicable Interest Determination Date is the
second London Banking Day preceding the related Interest Reset Date.
LIBOR means: (1) if "LIBOR Moneyline Telerate" is specified on
the face hereof or if neither "LIBOR Reuters" nor "LIBOR
Moneyline Telerate" is specified on the face hereof as the method
for calculating LIBOR, the rate for deposits in the LIBOR
Currency (as defined below) having the Index Maturity specified
on the face hereof, commencing on the related Interest Reset
Date, that appears on the LIBOR Page (as defined below) as of
11:00 A.M., London time, on the particular Interest Determination
Date; or (2) if "LIBOR Reuters" is specified on the face hereof,
the arithmetic mean of the offered rates, calculated by the
Calculation Agent, or the offered rate, if the LIBOR Page by its
terms provides only for a single rate, for deposits in the LIBOR
Currency having the particular Index Maturity, commencing on the
related Interest Reset Date, that appear or appears, as the case
may be, on the LIBOR Page as of 11:00 A.M., London time, on the
particular Interest Determination Date; or (3) if fewer than two
offered rates appear, or no rate appears, as the case may be, on
the particular Interest Determination Date on the LIBOR Page as
specified in clause (1) or (2), as applicable, the rate
calculated by the Calculation Agent of at least two offered
quotations obtained by the Calculation Agent after requesting the
principal London offices of each of four major reference banks
(which may include affiliates of the Agents), in the London
interbank market to provide the Calculation Agent with its
offered quotation for deposits in the LIBOR Currency for the
period of the particular Index Maturity, commencing on the
related Interest Reset Date, to prime banks in the London
interbank market at approximately 11:00 A.M., London time, on
that Interest Determination Date and in a principal amount that
is representative for a single transaction in the LIBOR
14
Currency in that market at that time; or (4) if fewer than two
offered quotations referred to in clause (3) are provided as
requested, the rate calculated by the Calculation Agent as the
arithmetic mean of the rates quoted at approximately 11:00 A.M.,
in the applicable Principal Financial Center, on the particular
Interest Determination Date by three major banks (which may
include affiliates of the Agents), in that Principal Financial
Center selected by the Calculation Agent for loans in the LIBOR
Currency to leading European banks, having the particular Index
Maturity and in a principal amount that is representative for a
single transaction in the LIBOR Currency in that market at that
time; or (5) if the banks so selected by the Calculation Agent
are not quoting as mentioned in clause (4), LIBOR in effect on
the particular Interest Determination Date; provided that if no
LIBOR is then in effect, the interest rate that will be effective
as of the next Interest Reset Date will be the Initial Interest
Rate.
"LIBOR Currency" means the currency specified on the face hereof
as to which LIBOR shall be calculated or, if no currency is
specified on the face hereof, United States dollars.
"LIBOR Page" means either: (1) if "LIBOR Reuters" is specified on
the face hereof, the display on the Reuter Monitor Money Rates
Service (or any successor service) on the page specified on the
face hereof (or any other page as may replace that page on that
service) for the purpose of displaying the London interbank rates
of major banks for the LIBOR Currency; or (2) if "LIBOR Moneyline
Telerate" is specified on the face hereof or neither "LIBOR
Reuters" nor "LIBOR Moneyline Telerate" is specified on the face
hereof as the method for calculating LIBOR, the display on
Moneyline Telerate (or any successor service) on the page
specified on the face hereof (or any other page as may replace
such page on such service) for the purpose of displaying the
London interbank rates of major banks for the LIBOR Currency.
"London Banking Day" means a day on which commercial banks are
open for business (including dealings in the LIBOR Currency) in
London.
(I) EURIBOR Notes. If the Interest Rate Basis is EURIBOR (as defined
below), the Notes shall be deemed to be "EURIBOR Notes." EURIBOR Notes
will bear interest at the rates (calculated with references to the
European inter-bank offered rate for deposits in Euro, or "EURIBOR",
and the Spread and/or Spread Multiplier, if any) specified on the face
hereof.
"EURIBOR" means, with respect to any Interest Determination Date
relating to EURIBOR Notes or Notes that bear interest at floating
rates for which the interest rate is determined with reference to
EURIBOR (a "EURIBOR Interest Determination Date"), the rate for
deposits in Euros as sponsored, calculated and published jointly
by the European Banking Federation and ACI--The Financial Market
Association, or any company established by the joint sponsors for
purposes of compiling and publishing those rates, having the
Index Maturity specified on the face hereof, commencing on the
applicable Interest Reset Date, as the rate appears on Moneyline
Telerate, Inc., or any successor service, on page 248 (or any
other page as may replace that specified page on the service)
("Moneyline Telerate Page 248") as of 11:00 A.M., Brussels time,
on the applicable EURIBOR Interest Determination Date. If such
rate does not appear on Moneyline Telerate Page 248, or is not so
published by 11:00 A.M., Brussels time, on the applicable EURIBOR
Interest Determination Date, such rate will be calculated by the
Calculation Agent and will be the arithmetic mean of at least two
quotations obtained by the Calculation Agent after requesting the
principal Euro-zone (as defined below) offices of four major
banks in the Euro-zone interbank market to provide the
Calculation Agent with its offered quotation for deposits in
Euros for the period of the Index Maturity specified on the face
hereof, commencing on the applicable Interest Reset Date, to
prime banks in the Euro-zone interbank market at approximately
11:00 A.M., Brussels time, on the applicable EURIBOR Interest
Determination Date and in a principal amount not less than the
equivalent of $1 million in Euros that is representative for a
15
single transaction in Euro in the market at that time. If fewer
than two such quotations are so provided, the rate on the
applicable EURIBOR Interest Determination Date will be calculated
by the Calculation Agent and will be the arithmetic mean of the
rates quoted at approximately 11:00 A.M., Brussels time, on such
EURIBOR Interest Determination Date by four major banks in the
Euro-zone for loans in Euro to leading European banks, having the
Index Maturity specified on the face hereof, commencing on the
applicable Interest Reset Date and in a principal amount not less
than the equivalent of $1 million in Euros that is representative
for a single transaction in Euros in the market at that time. If
the banks so selected by the Calculation Agent are not quoting as
mentioned above, EURIBOR will be EURIBOR in effect on the
applicable EURIBOR Interest Determination Date; provided that if
no EURIBOR is then in effect, the interest rate that will be
effective as of the next Interest Reset Date will be the Initial
Interest Rate.
"Euro-zone" means the region comprised of member states of the
European Union that have adopted the single currency in
accordance with the Treaty Establishing the European Community,
as amended by the Treaty on European Union.
(J) Prime Rate Notes. If the Interest Rate Basis is the Prime Rate, the
Notes shall be deemed to be "Prime Rate Notes." Prime Rate Notes will
bear interest for each Interest Reset Date calculated with reference
to the Prime Rate and the Spread or Spread Multiplier, if any, subject
to the Minimum Interest Rate and/or Maximum Interest Rate, if any,
specified on the face hereof. The Calculation Agent will determine the
Prime Rate for each Interest Reset Date on each applicable Interest
Determination Date. The Interest Determination Date is the Business
Day immediately preceding the related Interest Reset Date.
"Prime Rate" means: (1) the rate on the particular Interest
Determination Date as published in H.15(519) under the caption
"Bank Prime Loan"; or (2) if the rate referred to in clause (1)
is not so published by 3:00 P.M., New York City time, on the
related Calculation Date, the rate on the particular Interest
Determination Date as published in H.15 Daily Update, or such
other recognized electronic source used for the purpose of
displaying the applicable rate, under the caption "Bank Prime
Loan"; or (3) if the rate referred to in clause (2) is not so
published by 3:00 P.M., New York City time, on the related
Calculation Date, the rate on the particular Interest
Determination Date calculated by the Calculation Agent as the
arithmetic mean of the rates of interest publicly announced by
each bank that appears on the Reuters Screen US PRIME 1 Page (as
defined below) as the applicable bank's prime rate or base
lending rate as of 11:00 A.M., New York City time, on that
Interest Determination Date; or (4) if fewer than four rates
referred to in clause (3) are so published by 3:00 P.M., New York
City time, on the related Calculation Date, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent as the arithmetic mean of the prime rates or
base lending rates quoted on the basis of the actual number of
days in the year divided by a 360-day year as of the close of
business on that Interest Determination Date by three major banks
(which may include affiliates of the Agents) in The City of New
York selected by the Calculation Agent; or (5) if the banks so
selected by the Calculation Agent are not quoting as mentioned in
clause (4), the Prime Rate in effect on the particular Interest
Determination Date; provided that if no Prime Rate is then in
effect, the interest rate that will be effective as of the next
Interest Reset Date will be the Initial Interest Rate. "Reuters
Screen US PRIME 1 Page" means the display on the Reuter Monitor
Money Rates Service (or any successor service) on the "US PRIME
1" page (or any other page as may replace that page on that
service) for the purpose of displaying prime rates or base
lending rates of major United States banks.
(K) Treasury Rate Notes. If the Interest Rate Basis is the Treasury Rate,
the Notes shall be deemed to be "Treasury Rate Notes." Treasury Rate
Notes will bear interest for each Interest Reset Date at the interest
rate calculated with reference to the Treasury Rate and the Spread or
Spread Multiplier, if any. The Calculation Agent will determine the
Treasury Rate on each Treasury Rate Determination Date (as defined
below).
16
"Treasury Rate" means: (1) the rate from the auction held on the
Treasury Rate Interest Determination Date (the "Auction") of
direct obligations of the United States ("Treasury Bills") having
the Index Maturity specified on the face hereof under the caption
"INVESTMENT RATE" on the display on Moneyline Telerate (or any
successor service) on page 56 (or any other page as may replace
that page on that service) ("Moneyline Telerate Page 56") or page
57 (or any other page as may replace that page on that service)
("Moneyline Telerate Page 57"); or (2) if the rate referred to in
clause (1) is not so published by 3:00 P.M., New York City time,
on the related Calculation Date, the Bond Equivalent Yield (as
defined below) of the rate for the applicable Treasury Bills as
published in H.15 Daily Update, or another recognized electronic
source used for the purpose of displaying the applicable rate,
under the caption "U.S. Government Securities/Treasury
Bills/Auction High"; or (3) if the rate referred to in clause (2)
is not so published by 3:00 P.M., New York City time, on the
related Calculation Date, the Bond Equivalent Yield of the
auction rate of the applicable Treasury Bills as announced by the
United States Department of the Treasury; or (4) if the rate
referred to in clause (3) is not so announced by the United
States Department of the Treasury, or if the Auction is not held,
the Bond Equivalent Yield of the rate on the particular Interest
Determination Date of the applicable Treasury Bills as published
in H.15(519) under the caption "U.S. Government
Securities/Treasury Bills/Secondary Market"; or (5) if the rate
referred to in clause (4) is not so published by 3:00 P.M., New
York City time, on the related Calculation Date, the rate on the
particular Interest Determination Date of the applicable Treasury
Bills as published in H.15 Daily Update, or another recognized
electronic source used for the purpose of displaying the
applicable rate, under the caption "U.S. Government
Securities/Treasury Bills/Secondary Market"; or (6) if the rate
referred to in clause (5) is not so published by 3:00 P.M., New
York City time, on the related Calculation Date, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent as the Bond Equivalent Yield of the arithmetic
mean of the secondary market bid rates, as of approximately 3:30
P.M., New York City time, on that Interest Determination Date, of
three primary United States government securities dealers (which
may include the Agents or their affiliates) selected by the
Calculation Agent, for the issue of Treasury Bills with a
remaining maturity closest to the Index Maturity specified on the
face hereof; or (7) if the dealers so selected by the Calculation
Agent are not quoting as mentioned in clause (6), the Treasury
Rate in effect on the particular Interest Determination Date;
provided that if no Treasury Rate is then in effect, the interest
rate that will be effective as of the next Interest Reset Date
will be the Initial Interest Rate.
"Bond Equivalent Yield" means a yield (expressed as a percentage)
calculated in accordance with the following formula:
Bond Equivalent Yield = D x N x 100
----------------------
360 - (D x M)
where "D" refers to the applicable per annum rate for Treasury
Bills quoted on a bank discount basis and expressed as a decimal,
"N" refers to 365 or 366, as the case may be, and "M" refers to
the actual number of days in the applicable Interest Period.
The "Treasury Rate Determination Date" for each Interest Reset
Date means the day in the week in which the related Interest
Reset Date falls on which day Treasury Bills are normally
auctioned (i.e., Treasury Bills are normally sold at auction on
Monday of each week, unless that day is a legal holiday, in which
case the auction is normally held on the following Tuesday,
except that the auction may be held on the preceding Friday);
provided, however, that if an auction is held on the Friday of
the week preceding the related Interest Reset Date, the Interest
Determination Date will be the preceding Friday.
17
(L) Regular Floating Rate Notes. Unless the Notes are designated as
Floating Rate/Fixed Rate Notes or Inverse Floating Rate Notes, or as
having an Addendum attached or having other/additional provisions
apply, in each case relating to a different interest rate formula,
such Notes that bear interest at floating rates will be Regular
Floating Rate Notes and will bear interest at the rate determined by
reference to the applicable Interest Rate Basis or Bases plus or minus
the applicable Spread, if any, and/or multiplied by the applicable
Spread Multiplier, if any. Commencing on the first Interest Reset
Date, as specified on the face hereof, the rate at which interest on
Regular Floating Rate Notes is payable will be reset as of each
Interest Reset Date; provided, however, that the interest rate in
effect for the period, if any, from the date of issue to the first
Interest Reset Date will be the Initial Interest Rate.
(M) Floating Rate/Fixed Rate Notes. If the Notes are designated as
"Floating Rate/Fixed Rate Notes" on the face hereof, such Notes that
bear interest at floating rates will bear interest at the rate
determined by reference to the applicable Interest Rate Basis or Bases
plus or minus the applicable Spread, if any, and/or multiplied by the
applicable Spread Multiplier, if any. Commencing on the first Interest
Reset Date, the rate at which interest on Floating Rate/Fixed Rate
Notes is payable will be reset as of each Interest Reset Date;
provided, however, that the interest rate in effect for the period, if
any, from the date of issue to the first Interest Reset Date will be
the Initial Interest Rate, as specified on the face hereof; and the
interest rate in effect commencing on the Fixed Rate Commencement Date
will be the Fixed Interest Rate, if specified on the face hereof, or,
if not so specified, the interest rate in effect on the day
immediately preceding the Fixed Rate Commencement Date.
(N) Inverse Floating Rate Notes. If the Notes are designated as "Inverse
Floating Rate Notes" on the face hereof, the Inverse Floating Rate
shall be equal to the Fixed Interest Rate minus the rate determined by
reference to the applicable Interest Rate Basis or Bases plus or minus
the applicable Spread, if any, and/or multiplied by the applicable
Spread Multiplier, if any; provided, however, that interest on Inverse
Floating Rate Notes will not be less than zero. Commencing on the
first Interest Reset Date, the rate at which interest on Inverse
Floating Rate Notes is payable will be reset as of each Interest Reset
Date; provided, however, that the interest rate in effect for the
period, if any, from the date of issue to the first Interest Reset
Date will be the Initial Interest Rate.
SECTION 4. Optional Redemption. Except in the case of Discount Notes, if an
Initial Redemption Date is specified on the face hereof, the Trust may redeem
the Notes prior to the Stated Maturity Date at its option on any Business Day on
or after the Initial Redemption Date in whole or from time to time in part in
increments of $1,000 or any other integral multiple of an authorized
denomination specified on the face hereof (provided that any remaining principal
amount of the Notes shall be at least $1,000 or other minimum authorized
denomination applicable thereto), at the applicable Redemption Price (as defined
below), together with unpaid interest accrued on the Notes, any Additional
Amounts and other amounts payable with respect thereto to the date of
redemption. The Trust must give written notice to the Holders of the Notes to be
redeemed at its option not more than 60 nor less than 30 calendar days prior to
the date of redemption. "Redemption Price" means an amount equal to the Initial
Redemption Percentage specified on the face hereof (as adjusted by the Annual
Redemption Percentage Reduction, if applicable) multiplied by the unpaid
principal amount of Notes represented by this Note Certificate to be redeemed.
The Initial Redemption Percentage, if any, shall decline at each anniversary of
the Initial Redemption Date by an amount equal to the applicable Annual
Redemption Percentage Reduction, if any, until the Redemption Price is equal to
100% of the unpaid amount thereof to be redeemed.
SECTION 5. Sinking Funds and Amortizing Notes. Unless otherwise specified
on the face hereof or unless the Notes are Amortizing Notes, the Notes will not
be subject to any sinking fund. If it is specified on the face hereof that the
Notes are Amortizing Notes, the Trust will make payments combining principal and
interest on the dates and in the amounts set forth in the table appearing in
SCHEDULE I, attached to this Note Certificate. If the Notes are Amortizing
Notes, payments made on the Notes will be applied first to interest due and
payable on each such payment date and then to the reduction of the unpaid
principal amount.
SECTION 6. Optional Repayment. If so specified on the face hereof, the
Notes will be subject to repayment by the Trust at the option of the Holder of
the Notes on the Optional Repayment Date(s) specified on the face hereof, in
whole or in part in increments of U.S.$1,000 (provided that any remaining
18
principal amount of the Notes shall be at least U.S.$1,000), at a repayment
price equal to 100% of the unpaid principal amount of the Notes to be repaid,
together with unpaid interest accrued thereon to the Repayment Date (as defined
below). For the Notes to be so repaid, the Indenture Trustee must receive at its
corporate trust office not more than 60 nor less than 30 calendar days prior to
the applicable Optional Repayment Date, a properly completed Option to Elect
Repayment form, which is attached hereto as Annex A, forwarded by the Holder
hereof. Exercise of such repayment option shall be irrevocable. As used herein,
the term "Repayment Date" shall mean the date fixed for repayment in accordance
with the repayment provisions specified above.
SECTION 7. Modifications and Amendments. Sections9.1 and 9.2 of the
Standard Indenture Terms contain provisions permitting the Trust and the
Indenture Trustee (1) without the consent of any Holder, to execute Supplemental
Indentures for limited purposes and take other actions set forth in the Standard
Indenture Terms, and (2) with the consent of the Holders of not less than
66(2)/3% in aggregate principal amount of Notes at the time outstanding,
evidenced as in the Standard Indenture Terms, to execute Supplemental Indentures
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Indenture or any Supplemental Indenture or modifying in any
manner the rights of the Holders of the Notes subject to specified limitations.
SECTION 8. Obligations Unconditional. No reference herein to the Indenture
or the Standard Indenture Terms and no provision of the Notes or of the
Indenture shall alter or impair the obligation of the Trust, which is absolute
and unconditional, to pay the principal of, interest on, or any other amount due
and owing with respect to, the Notes at the places, at the respective times, at
the rate, and in the coin or currency, herein prescribed.
SECTION 9. Collateral. Pursuant to the Indenture, the Trust will grant a
security interest in, pledge and collaterally assign the Collateral specified on
the face hereof to the Indenture Trustee on behalf of the holders of the Notes
and any other person for whose benefit the Indenture Trustee is or will be
holding the Collateral. The Notes will be secured by a first priority perfected
security interest in the Collateral in favor of the Indenture Trustee and the
other persons identified in the Standard Indenture Terms.
SECTION 10. Security; Limited Recourse. The Notes are solely the
obligations of the Trust, and will not be guaranteed by any person, including
but not limited to Allstate Life, Allstate Life Global Funding, any Agent, the
Trust Beneficial Owner, the Delaware Trustee, the Indenture Trustee or any of
their affiliates. The Trust's obligations under the Notes will be secured by all
of the Trust's rights and title in one or more Funding Agreement(s) issued by
Allstate Life and other rights and assets included in the applicable Collateral.
The Holder of the Notes has no direct contractual rights against Allstate Life
under the Funding Agreement(s). Under the terms of each Funding Agreement,
recourse rights to Allstate Life will belong to the Trust, its successors and
permitted assignees. The Trust has pledged, collaterally assigned and granted a
first priority perfected security interest in the Collateral for the Notes to
the Indenture Trustee on behalf of the Holders of the Notes and the other
persons identified in the Standard Indenture Terms. Recourse to Allstate Life
under each Funding Agreement will be enforceable only by the Indenture Trustee
as a secured party on behalf of the Holders of Notes and the other persons
identified in the Standard Indenture Terms.
SECTION 11. Events of Default. In case an Event of Default, as defined in
the Standard Indenture Terms, shall have occurred and be continuing, the
principal of the Notes may be declared, and upon such declaration shall become,
due and payable in the manner, with the effect and subject to the conditions
provided in the Indenture. If the Notes are Discount Notes, the amount of
principal of the Notes that becomes due and payable upon such acceleration shall
be equal to the amount calculated as set forth in Section 3 hereof.
SECTION 12. Withholding; Additional Amounts; Tax Event. All amounts due in
respect of the Notes will be made without withholding or deduction for or on
account of any present or future taxes, duties, levies, assessments or other
governmental charges of whatever nature imposed or levied by or on behalf of any
governmental authority in the United States having the power to tax payments on
the Notes unless the withholding or deduction is required by law. Unless
otherwise specified on the face hereof, the Trust will not pay any additional
amounts ("Additional Amounts") to Holders of the Notes in the event that any
withholding or deduction is so required by law, regulation or official
interpretation thereof, and the imposition of a requirement to make any such
withholding or deduction will not give rise to any independent right or
obligation to redeem the Notes. If the Trust is required to pay Additional
Amounts pursuant to the applicable provisions of the Standard Indenture Terms
and unless otherwise specified herein, the Trust shall give a notice of
redemption to each Holder of the Notes to be redeemed not more than 75 days nor
less than 30 days prior to the Redemption Date; provided that no such notice of
redemption may be given earlier than 90 days prior to the earliest day on which
19
the Trust would become obligated to pay the applicable Additional Amounts were a
payment in respect of the Notes then due. Failure to give such notice to the
Holder of any Note designated for redemption in whole or in part, or any defect
in the notice to any such Holder, shall not affect the validity of the
proceedings for the redemption of any other Note or any portion thereof. "Tax
Event" means that the Trust shall have become required at any time to pay
Additional Amounts or if the Trust is obligated to withhold or deduct any United
States taxes with respect to any payment under the Notes or if there is a
material probability that the Trust will become obligated to withhold or deduct
any such United States taxes or otherwise pay Additional Amounts (in the opinion
of independent legal counsel selected by Allstate Life), in each case pursuant
to any change in or amendment to any United States tax laws (or any regulations
or rulings thereunder) or any change in position of the Internal Revenue Service
regarding the application or interpretation thereof (including, but not limited
to, Allstate Life's or the Trust's receipt of a written adjustment from the
Internal Revenue Service in connection with an audit).
SECTION 13. Listing. Unless otherwise specified on the face hereof, the
Notes will not be listed on any securities exchange.
SECTION 14. No Recourse Against Certain Persons. No recourse shall be had
for the payment of the principal of or the interest on the Notes, or for any
claim based hereon, or otherwise in respect thereof, or based on or in respect
of the Indenture or any Supplemental Indenture, against the Nonrecourse Parties,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such personal
liability being, by the acceptance of any Notes and as part of the consideration
for issue of the Notes, expressly waived and released.
SECTION 15. Governing Law. Pursuant to Section 5-1401 of the General
Obligations Law of the State of New York, the Notes shall be governed by, and
construed in accordance with, the laws of the State of New York.
20
ANNEX A
OPTION TO ELECT REPAYMENT
The undersigned Holder of the Notes hereby irrevocably elects to have
the Trust repay the principal amount of the Notes or portion hereof at the
optional repayment price in accordance with the terms of the Notes.
Date: Signature
--------------------------------------------- Sign exactly as name
appears on the front
of this Note
Certificate [SIGNATURE
GUARANTEED--required
only if Notes are to
be issued and
delivered to other
than the
registered Holder]
Fill in for
registration of Notes
if to be issued
otherwise than to the
registered Holder:
Principal amount to be repaid, if amount to be
repaid is less than the principalamount of the
Notes represented by this Note Certificate
(principal amount remaining must be an
authorized denomination)
$
-----------------------------
Name:
----------------------------------------------
Address:
----------------------------------------------
(Please print name and address including zip
code)
Social Security or Other Taxpayer ID Number
A-1
SCHEDULE I
AMORTIZATION TABLE
Date Payment
------------------------ ------------------
I-1
EXHIBIT 4.10
FORM OF GLOBAL SECURITY FOR
ALLSTATE LIFE(R) CORENOTES(R) PROGRAM
[FACE OF GLOBAL SECURITY]
Unless this Note Certificate is presented by an authorized representative of the
Depository Trust Company, a New York corporation ("DTC"), to the issuer or its
agent for registration of transfer, exchange or payment, and any note issued is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC (and any payment is made to Cede & Co. or such
other entity as is requested by an authorized representative of DTC), any
transfer, pledge or other use hereof for value or otherwise by or to any person
is wrongful inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
This Note Certificate is a global security within the meaning of the standard
indenture terms hereinafter referred to and is registered in the name of Cede &
Co., or such other nominee of DTC, or any successor depositary ("Depositary"),
as requested by an authorized representative of the Depositary. The notes
represented by this Note Certificate may not be exchanged in whole or in part
for notes registered, and no transfer of the notes represented by this Note
Certificate in whole or in part may be registered, in the name of any person
other than the Depositary or a nominee thereof, except in the limited
circumstances described in the standard indenture terms. Every Note Certificate
authenticated and delivered upon registration of, transfer of, or in exchange
for, or in lieu of, this Note Certificate will be a global security subject to
the foregoing, except in such limited circumstances.
CUSIP No.:
ALLSTATE LIFE GLOBAL FUNDING TRUST
ALLSTATE LIFE(R) CORENOTES(R)
Title of Notes: Stated Maturity Date:
Principal Amount: $ Securities Exchange Listing: [ ] Yes [ ] No. If yes,
Original Issue Date: indicate name(s) of Securities Exchange(s):
Issue Price:
Interest Rate or Formula:
Fixed Rate Notes: [ ] Yes [ ] No. If yes, Floating Rate Notes: [ ] Yes [ ] No. If yes,
Interest Rate: Regular Floating Rate Notes: [ ]
Interest Payment Dates: Floating Rate/Fixed Rate Notes: [ ]
Day Count Convention: Interest Rate:
Additional/Other Terms: Interest Rate Basis(es):
Discount Notes: [ ] Yes [ ] No. If yes, CD Rate [ ]
Total Amount of Discount: CMT Rate [ ]
Initial Accrual Period of Discount: Commercial Paper Rate [ ]
Additional/Other Terms: Constant Maturity Swap Rate [ ]
Redemption Provisions: [ ] Yes [ ] No. If yes, Federal Funds Open Rate [ ]
Initial Redemption Date: Federal Funds Rate [ ]
Initial Redemption Percentage: LIBOR [ ]
Annual Redemption Percentage Prime Rate [ ]
Additional/Other Terms: Treasury Rate [ ]
Survivor's Option: [ ] Yes [ ] No. If LIBOR:
Regular Interest Record Date(s): [ ] LIBOR Moneyline Telerate:
Sinking Fund: [ ] LIBOR Reuters:
Calculation Agent: LIBOR Currency:
Depositary: If CMT Rate:
Authorized Denominations: Designated CMT Telerate Page:
Collateral: The right, title and interest of the Trust in
and to: If CMT Moneyline Telerate Page 7052:
(i) Allstate Life Insurance Company Funding [ ] Weekly Average
Agreement No(s). [ ]; (ii) all proceeds in respect of such [ ] Monthly Average
Funding Agreement(s); and (iii) all books and
records (including, without limitation, computer programs, Designated CMT Maturity Index:
printouts, and other computer materials and files) Index Maturity:
pertaining to such Funding Agreement(s). Spread (+/-), if any:
Spread Multiplier, if any:
Initial Interest Rate, if any:
Initial Interest Reset Date:
Interest Reset Dates:
Interest Determination Date(s):
Interest Payment Dates:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Fixed Rate Commencement Date, if any:
Floating Interest Rate, if any:
Fixed Interest Rate, if any:
Day Count Convention:
Additional/Other Terms:
"Allstate Life(R)" is a registered servicemark of Allstate Insurance
Company. "CoreNotes(R)" is a registered servicemark of Merrill Lynch & Co., Inc.
This Note Certificate is a Global Security in respect of a duly authorized
issue of Notes (the "Notes") of the Allstate Life Global Funding Trust
designated above, a statutory trust organized under the laws of the State of
Delaware (the "Trust"). The Notes are issued under the Indenture, dated as of
the date hereof (as amended or supplemented from time to time, the "Indenture")
among the Trust and the other persons specified therein. Capitalized terms used
herein and not otherwise defined shall have the respective meanings ascribed in
the Standard Indenture Terms, which are incorporated by reference in and form a
part of the Indenture (as amended or supplemented from time to time, the
"Standard Indenture Terms").
The Trust, for value received, hereby promises to pay to [Cede & Co.] or
its registered assigns on the Stated Maturity Date (or on the date of redemption
or repayment by the Trust prior to maturity pursuant to redemption or repayment
provisions, in each case, if provided for above) the principal amount specified
above and, if so specified above, to pay interest from time to time on the Notes
represented by this Note Certificate from the Original Issue Date specified
above (the "Original Issue Date") or from the most recent Interest Payment Date
to which interest has been paid or duly provided for at the rate per annum
determined in accordance with the provisions on the reverse hereof and as
specified above, until the principal of the Notes represented by this Note
Certificate is paid or made available for payment and to pay such other amounts
due and owing with respect to the Notes represented by this Note Certificate.
On any exchange or purchase and cancellation of any of the Notes
represented by this Note Certificate, details of such exchange or purchase and
cancellation shall be entered in the records of the Indenture Trustee. Upon any
such exchange or purchase and cancellation, the principal amount of the Notes
represented by this Note Certificate shall be charged by the principal amount so
exchanged or purchased and cancelled, as provided in the Standard Indenture
Terms.
Unless otherwise set forth above, if the Notes are subject to an Annual
Redemption Percentage Reduction as specified above, the Redemption Price of the
Notes represented by this Note Certificate shall initially be the Initial
Redemption Percentage of the principal amount of the Notes represented by this
Note Certificate on the Initial Redemption Date and shall decline at each
anniversary of the Initial Redemption Date (each such date, a "Redemption Date")
by the Annual Redemption Percentage Reduction of such principal amount until the
Redemption Price is 100% of such principal amount.
2
The Notes will mature on the Stated Maturity Date, unless their principal
(or, any installment of their principal) becomes due and payable prior to the
Stated Maturity Date, whether, as applicable, by the declaration of acceleration
of maturity, notice of redemption at the option of the Trust, notice of the
Holder's option to elect repayment or otherwise (the Stated Maturity Date or any
date prior to the Stated Maturity Date on which the Notes become due and
payable, as the case may be, are referred to as the "Maturity Date" with respect
to principal of the Notes repayable on such date).
Unless otherwise provided above and except as provided in the following
paragraph, the Trust will pay interest on each Interest Payment Date specified
above, commencing with the first Interest Payment Date next succeeding the
Original Issue Date, and on the Maturity Date; provided that any payment of
principal, premium, if any, interest or other amounts to be made on any Interest
Payment Date or on a Maturity Date that is not a Business Day shall be made in
accordance with the provisions set forth on the reverse hereof.
Unless otherwise specified above, the interest payable on each Interest
Payment Date or on the Maturity Date will be the amount equal to the interest
accrued from and including the immediately preceding Interest Payment Date in
respect of which interest has been paid or from and including the date of issue,
if no interest has been paid, to but excluding the applicable Interest Payment
Date or the Maturity Date, as the case may be (each, an "Interest Period").
Reference is hereby made to the further provisions of the Notes set forth
on the reverse hereof and, if so specified on the face hereof, in an Addendum
hereto, which further provisions shall for all purposes have the same force and
effect as if set forth on the face hereof.
Notwithstanding the foregoing, if an Addendum is attached hereto or
"Other/Additional Provisions" apply to the Notes as specified above, the Notes
shall be subject to the terms set forth in such Addendum or such
"Other/Additional Provisions."
The Notes represented by this Note Certificate shall not be valid or become
obligatory for any purpose until the certificate of authentication hereon shall
have been executed by the Indenture Trustee pursuant to the Indenture.
3
IN WITNESS WHEREOF, the Trust has caused this instrument to be duly
executed on its behalf.
Dated: Original Issue Date THE ALLSTATE LIFE GLOBAL FUNDING TRUST SPECIFIED ON THE
FACE OF THIS NOTE CERTIFICATE,
as Issuer
By: [WILMINGTON TRUST COMPANY],
not in its individual capacity,
but solely as Delaware Trustee
By:
------------------------------------
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This Note Certificate is one of the Note Certificates representing
Notes described in the within-mentioned Indenture.
Dated: Original Issue Date [J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION],
as Indenture Trustee
By:
---------------------------------------
Authorized Signatory
4
[REVERSE OF GLOBAL SECURITY]
SECTION 1. General. This Note Certificate is a Global Security in respect
of a duly authorized issue of Notes of the Trust. The Notes are issued pursuant
to the Indenture.
SECTION 2. Currency. The Notes are denominated in, and payments of
principal, premium, if any, and/or interest, if any, will be made in U.S.
dollars.
SECTION 3. Determination of Interest Rate and Other Payment Provisions.
Fixed Rate Notes. If the Notes are designated on the face hereof as "Fixed
Rate Notes," the Notes will bear interest from the Original Issue Date until the
Maturity Date. Unless otherwise specified on the face hereof, the rate of
interest payable on the Notes will not be adjusted; unless otherwise specified
on the face hereof, interest will be payable on the Interest Payment Dates set
forth on the face hereof and at the Maturity Date. Interest will be computed on
the basis of a 360-day year of twelve 30-day months. If any Interest Payment
Date or the Maturity Date of Fixed Rate Notes falls on a day that is not a
Business Day, any payments of principal, premium, if any, and/or interest or
other amounts required to be made, will be made on the next succeeding Business
Day, and no additional interest will accrue in respect of the payment made on
that next succeeding Business Day.
Discount Notes. If the Notes are designated on the face hereof as "Discount
Notes" (as defined below), payments in respect of the Notes shall be made as set
forth on the face hereof. In the event a Discount Note is redeemed, repaid or
accelerated, the amount payable to the Holder of such Note will be equal to the
sum of: (1) the Issue Price (increased by any accruals of discount) and, in the
event of any redemption of such Discount Notes, if applicable, multiplied by the
Initial Redemption Percentage (as adjusted by the Annual Redemption Percentage
Reduction, if applicable); and (2) any unpaid interest accrued on such Discount
Notes to the date of redemption, repayment or acceleration of maturity, as
applicable. For purposes of determining the amount of discount that has accrued
as of any date on which a redemption, repayment or acceleration of maturity of
the Notes occurs for Discount Notes, the discount will be accrued using a
constant yield method. The constant yield will be calculated using a 30-day
month, 360-day year convention, a compounding period that, except for the
Initial Period (as defined below), corresponds to the shortest period between
Interest Payment Dates for Discount Notes (with ratable accruals within a
compounding period), a coupon rate equal to the initial coupon rate applicable
to Discount Notes and an assumption that the maturity of such Discount Notes
will not be accelerated. If the period from the date of issue to the first
Interest Payment Date for Discount Notes (the "Initial Period") is shorter than
the compounding period for such Discount Notes, a proportionate amount of the
yield for an entire compounding period will be accrued. If the Initial Period is
longer than the compounding period, then the period will be divided into a
regular compounding period and a short period with the short period being
treated as provided in the preceding sentence. The accrual of the applicable
discount may differ from the accrual of original issue discount for purposes of
the Code, certain Discount Notes may not be treated as having original issue
discount within the meaning of the Code, and certain Notes other than Discount
Notes may be treated as issued with original issue discount for federal income
tax purposes. A "Discount Note" is any Note that has an Issue Price that is less
than 100% of the principal amount thereof by more than a percentage equal to the
product of 0.25% and the number of full years to the Stated Maturity Date. A
Discount Note may not bear any interest currently or may bear interest at a rate
that is below market rates at the time of issuance.
Floating Rate Notes. If the Notes are specified on the face hereof as
"Floating Rate Notes," interest on the Notes shall accrue and be payable in
accordance with this Section 3. A Floating Rate Note may be a CD Rate Note, CMT
Rate Note, Commercial Paper Rate Note, Constant Maturity Swap Rate Note, Federal
Funds Open Rate Note, Federal Funds Rate Note, LIBOR Note, Prime Rate Note or
Treasury Rate Note. If the Notes are designated on the face hereof as Floating
Rate Notes, the face hereof will specify whether the Notes are Regular Floating
Rate Notes or Floating Rate/Fixed Rate Notes. For the period from the date of
issue to, but not including, the first Interest Reset Date set forth on the face
hereof, the interest rate hereon shall be the Initial Interest Rate specified on
the face hereof. Thereafter, the interest rate hereon will be reset as of and be
effective as of each Interest Reset Date.
(A) If any Interest Reset Date would otherwise be a day that is not a
Business Day, such Interest Reset Date shall be postponed to the next
5
day that is a Business Day; provided, however, that if the Notes are
LIBOR Notes and such Business Day is in the next succeeding calendar
month, such Interest Reset Date shall be the Business Day immediately
preceding such Interest Reset Date.
(B) Unless specified otherwise on the face hereof, Interest Reset Dates
are as follows: (1) if the Notes reset daily, each Business Day; (2)
if the Notes reset weekly, other than Treasury Rate Notes, the
Wednesday of each week; (3) if the Notes are Treasury Rate Notes that
reset weekly, and except as provided below under "Treasury Rate
Notes," the Tuesday of each week; (4) if the Notes reset monthly, the
third Wednesday of each month; (5) if the Notes reset quarterly, the
third Wednesday of every third calendar month, beginning in the third
calendar month following the month in which the Notes were issued; (6)
if the Notes reset semiannually, the third Wednesday of each of the
two months specified on the face hereof; and (7) if the Notes reset
annually, the third Wednesday of the month specified on the face
hereof; provided, however, that with respect to Floating Rate/ Fixed
Rate Notes, the rate of interest thereon will not reset after the
particular Fixed Rate Commencement Date specified on the face hereof
(the "Fixed Rate Commencement Date").
(C) Accrued interest is calculated by multiplying the principal amount of
such Floating Rate Note by an accrued interest factor. The accrued
interest factor is computed by adding the interest factor calculated
for each day in the particular Interest Period. The interest factor
for each day will be computed by dividing the interest rate applicable
to such day by 360, in the case of Floating Rate Notes as to which the
CD Rate, the Commercial Paper Rate, the Federal Funds Open Rate, the
Federal Funds Rate, LIBOR or the Prime Rate is an applicable Interest
Rate Basis (as defined below), or by the actual number of days in the
year, in the case of Floating Rate Notes as to which the CMT Rate or
the Treasury Rate is an applicable Interest Rate Basis. In the case of
a Floating Rate Note as to which the Constant Maturity Swap Rate is
the Interest Rate Basis, the interest factor will be computed by
dividing the number of days in the interest period by 360 (the number
of days to be calculated on the basis of a year of 360 days with 12
30-day months (unless (i) the last day of the interest period is the
31st day of a month but the first day of the interest period is a day
other than the 30th or 31st day of a month, in which case the month
that includes that last day shall not be considered to be shortened to
a 30-day month, or (ii) the last day of the interest period is the
last day of the month of February, in which case the month of February
shall not be considered to be lengthened to a 30-day month)). The
interest factor for Floating Rate Notes as to which the interest rate
is calculated with reference to two or more Interest Rate Bases will
be calculated in each period in the same manner as if only the
applicable Interest Rate Basis specified on the face hereof applied.
The interest rate shall be set forth on the face hereof. For purposes
of making the foregoing calculation, the interest rate in effect on
any Interest Reset Date will be the applicable rate as reset on that
date. Unless otherwise specified on the face hereof, the interest rate
that is effective on the applicable Interest Reset Date will be
determined on the applicable Interest Determination Date and
calculated on the applicable Calculation Date (as defined below).
"Calculation Date" means the date by which the Calculation Agent
designated on the face hereof, is to calculate the interest rate
which will be the earlier of: (1) the tenth calendar day after
the particular Interest Determination Date or, if such day is not
a Business Day, the next succeeding Business Day; or (2) the
Business Day immediately preceding the applicable Interest
Payment Date or the Maturity Date, as the case may be.
(D) Unless otherwise specified on the face hereof, all percentages
resulting from any calculation on Floating Rate Notes will be rounded
to the nearest one hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upwards. All dollar
amounts used in or resulting from any calculation on Floating Rate
Notes will be rounded to the nearest cent.
(E) Unless otherwise specified on the face hereof, if the Notes are
designated on the face hereof as Floating Rate Notes, if any Interest
Payment Date (other than the Maturity Date for the Notes) would
otherwise be a day that would not be a Business Day, such Interest
6
Payment Date would be postponed to the next succeeding Business Day;
provided, however, that if the Notes are LIBOR Notes and such Business
Day is in the next succeeding calendar month, such Interest Payment
Date shall be the immediately preceding Business Day. Unless otherwise
specified on the face hereof, if the Notes are designated on the face
hereof as Floating Rate Notes, if the Maturity Date of the Notes falls
on a day this is not a Business Day, the Trust will make the required
payment of principal, premium, if any, and interest or other amounts
on the next succeeding Business Day, and no additional interest will
accrue in respect of the payment made on that next succeeding Business
Day.
Unless otherwise specified on the face hereof and except as provided below,
interest will be payable as follows: (1) if the Interest Reset Date for the
Notes is daily, weekly or monthly, interest will be payable on the third
Wednesday of every third calendar month, beginning in the third calendar month
following the month in which the Notes were issued, as specified on the face
hereof; (2) if the Interest Reset Date for the Notes is quarterly, interest will
be payable on the third Wednesday of every third calendar month, beginning in
the third calendar month following the month in which the Notes were issued; (3)
if the Interest Reset Date for the Notes is semiannually, interest will be
payable on the third Wednesday of each of two months of each year specified on
the face hereof; (4) if the Interest Reset Date for the Notes is annually,
interest will be payable on the third Wednesday of the month of each year
specified on the face hereof. In each of these cases, interest will also be
payable on the Maturity Date.
If specified on the face hereof, the Notes may have either or both of a
Maximum Interest Rate or Minimum Interest Rate. If a Maximum Interest Rate is so
designated, the interest rate that may accrue during any Interest Period for
Floating Rate Notes cannot ever exceed such Maximum Interest Rate and in the
event that the interest rate on any Interest Reset Date would exceed such
Maximum Interest Rate (as if no Maximum Interest Rate were in effect) then the
interest rate on such Interest Reset Date shall be the Maximum Interest Rate. If
a Minimum Interest Rate is so designated, the interest rate that may accrue
during any Interest Period for Floating Rate Notes cannot ever be less than such
Minimum Interest Rate and in the event that the interest rate on any Interest
Reset Date would be less than such Minimum Interest Rate (as if no Minimum
Interest Rate were in effect) then the interest rate on such Interest Reset Date
shall be the Minimum Interest Rate. Notwithstanding anything to the contrary
contained herein, if the Notes are designated on the face hereof as Floating
Rate Notes, the interest rate on Notes shall not exceed the maximum interest
rate permitted by applicable law.
All determinations of interest by the Calculation Agent designated on the
face hereof will, in the absence of manifest error, be conclusive for all
purposes and binding on the Holder of the Notes and neither the Indenture
Trustee nor the Calculation Agent shall have any liability to the Holder of the
Notes in respect of any determination, calculation, quote or rate made or
provided by the Calculation Agent. Upon request of the Holder of the Notes, the
Calculation Agent will provide the interest rate then in effect and, if
determined, the interest rate that will become effective on the next Interest
Reset Date with respect to the Notes. If the Calculation Agent is incapable or
unwilling to act as such or if the Calculation Agent fails duly to establish the
interest rate for any interest accrual period or to calculate the interest
amount or any other requirements, the Trust will appoint a successor to act as
such in its place. The Calculation Agent may not resign its duties until a
successor has been appointed and such successor has accepted its appointment.
Subject to applicable provisions of law and except as specified herein, on
each Interest Reset Date, the rate of interest on the Notes on and after the
first Interest Reset Date shall be the interest rate determined in accordance
with the provisions of the heading below which has been designated as the
Interest Rate Basis on the face hereof (the "Interest Rate Basis"), the base
rate, plus or minus the Spread, if any, specified on the face hereof and/or
multiplied by the Spread Multiplier, if any, specified on the face hereof.
(A) CD Rate Notes. If the Interest Rate Basis is the CD Rate, the Notes
shall be deemed to be "CD Rate Notes." CD Rate Notes will bear
interest at the interest rate calculated with reference to the CD Rate
and the Spread or Spread Multiplier, if any. The Calculation Agent
will determine the CD Rate on each Interest Determination Date. The
Interest Determination Date is the second Business Day preceding the
related Interest Reset Date.
"CD Rate" means: (1) the rate on the particular Interest
Determination Date for negotiable United States dollar
certificates of deposit having the Index Maturity specified on
the face hereof as published in H.15(519) (as defined below)
under the caption "CDs (secondary market)"; or (2) if the rate
referred to in clause (1) is not so published by 3:00 P.M., New
York City time, on the related Calculation Date, the rate on the
7
particular Interest Determination Date for negotiable United
States dollar certificates of deposit of the particular Index
Maturity as published in the H.15 Daily Update (as defined below)
or other recognized electronic source used for the purpose of
displaying the applicable rate under the heading "CDs (secondary
market)"; or (3) if the rate referred to in clause (2) is not yet
published in either H.15(519) or the H.15 Daily Update by 3:00
P.M., New York City time, on the related Calculation Date, then
the CD Rate will be the rate on the particular Interest
Determination Date calculated by the Calculation Agent as the
arithmetic mean of the secondary market offered rates as of 10:00
A.M., New York City time on that Interest Determination Date of
three leading nonbank dealers in negotiable United States dollar
certificates of deposit in The City of New York (which may
include the Agents or their affiliates) selected by the
Calculation Agent for negotiable United States dollar
certificates of deposit of major United States money market banks
for negotiable United States certificates of deposit with a
remaining maturity closest to the particular Index Maturity in an
amount that is representative for a single transaction in that
market at that time; or (4) if the dealers so selected by the
Calculation Agent are not quoting as mentioned in clause (3), the
CD Rate in effect on the particular Interest Determination Date;
provided that if no CD Rate is then in effect, the interest rate
that will be effective as of the next Interest Reset Date will be
the Initial Interest Rate.
"H.15(519)" means the weekly statistical release designated as
H.15(519), or any successor publication, published by the Board
of Governors of the Federal Reserve System.
"H.15 Daily Update" means the daily update of H.15(519),
available through the world-wide-web site of the Board of
Governors of the Federal Reserve System at
http://www.federalreserve.gov/releases/H15/update, or any
successor site or publication.
(B) CMT Rate Notes. If the Interest Basis is the CMT Rate, the Notes shall
be deemed to be "CMT Rate Notes." CMT Rate Notes will bear interest at
the interest rate calculated with reference to the CMT Rate and the
Spread or Spread Multiplier, if any. The Calculation Agent will
determine the CMT Rate on each applicable Interest Determination Date.
The applicable Interest Determination Date is the second Business Day
preceding the Interest Reset Date.
"CMT Rate" means: (1) if CMT Moneyline Telerate Page 7051 is
specified on the face hereof: (a) the percentage equal to the
yield for United States Treasury securities at "constant
maturity" having the Index Maturity specified on the face hereof
as published in H.15(519) under the caption "Treasury Constant
Maturities", as the yield is displayed on Moneyline Telerate (or
any successor service) on page 7051 (or any other page as may
replace the specified page on that service) ("Moneyline Telerate
Page 7051"), for the particular Interest Determination Date; or
(b) if the rate referred to in clause (a) does not so appear on
Moneyline Telerate Page 7051, the percentage equal to the yield
for United States Treasury securities at "constant maturity"
having the particular Index Maturity and for the particular
Interest Determination Date as published in H.15(519) under the
caption "Treasury Constant Maturities"; or (c) if the rate
referred to in clause (b) does not so appear in H.15(519), the
rate on the particular Interest Determination Date for the period
of the particular Index Maturity as may then be published by
either the Federal Reserve System Board of Governors or the
United States Department of the Treasury that the Calculation
Agent determines to be comparable to the rate which would
otherwise have been published in H.15(519); or (d) if the rate
referred to in clause (c) is not so published, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent as a yield to maturity based on the arithmetic
mean of the secondary market bid prices at approximately 3:30
P.M., New York City time, on that Interest Determination Date of
three leading primary United States government securities dealers
in The City of New York (which may include the Agents or their
affiliates) (each, a "Reference Dealer"), selected by the
Calculation Agent from five Reference Dealers selected by the
Calculation Agent and eliminating the highest quotation, or, in
the event of equality, one of the highest, and the lowest
quotation or, in the event of equality, one of the lowest, for
8
United States Treasury securities with an original maturity equal
to the particular Index Maturity, a remaining term to maturity no
more than one year shorter than that Index Maturity and in a
principal amount that is representative for a single transaction
in the securities in that market at that time; or (e) if fewer
than five but more than two of the prices referred to in clause
(d) are provided as requested, the rate on the particular
Interest Determination Date calculated by the Calculation Agent
based on the arithmetic mean of the bid prices obtained and
neither the highest nor the lowest of the quotations shall be
eliminated; or (f) if fewer than three prices referred to in
clause (d) are provided as requested, the rate on the particular
Interest Determination Date calculated by the Calculation Agent
as a yield to maturity based on the arithmetic mean of the
secondary market bid prices as of approximately 3:30 P.M., New
York City time, on that Interest Determination Date of three
Reference Dealers selected by the Calculation Agent from five
Reference Dealers selected by the Calculation Agent and
eliminating the highest quotation or, in the event of equality,
one of the highest and the lowest quotation or, in the event of
equality, one of the lowest, for United States Treasury
securities with an original maturity greater than the particular
Index Maturity, a remaining term to maturity closest to that
Index Maturity and in a principal amount that is representative
for a single transaction in the securities in that market at that
time; or (g) if fewer than five but more than two prices referred
to in clause (f) are provided as requested, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent based on the arithmetic mean of the bid prices
obtained and neither the highest nor the lowest of the quotations
will be eliminated; or (h) if fewer than three prices referred to
in clause (f) are provided as requested, the CMT Rate in effect
on the particular Interest Determination Date; provided that if
no CMT Rate is then in effect, the interest rate that will be
effective as of the next Interest Reset Date will be the Initial
Interest Rate; or (2) if CMT Moneyline Telerate Page 7052 is
specified on the face hereof: (a) the percentage equal to the
one-week or one-month, as specified on the face hereof, average
yield for United States Treasury securities at "constant
maturity" having the Index Maturity specified on the face hereof
as published in H.15(519) opposite the caption "Treasury Constant
Maturities", as the yield is displayed on Moneyline Telerate (or
any successor service) (on page 7052 or any other page as may
replace the specified page on that service) ("Moneyline Telerate
Page 7052"), for the week or month, as applicable, ended
immediately preceding the week or month, as applicable, in which
the particular Interest Determination Date falls; or (b) if the
rate referred to in clause (a) does not so appear on Moneyline
Telerate Page 7052, the percentage equal to the one-week or
one-month, as specified on the face hereof, average yield for
United States Treasury securities at "constant maturity" having
the particular Index Maturity and for the week or month, as
applicable, preceding the particular Interest Determination Date
as published in H.15(519) opposite the caption "Treasury Constant
Maturities"; or (c) if the rate referred to in clause (b) does
not so appear in H.15(519), the one-week or one-month, as
specified on the face hereof, average yield for United States
Treasury securities at "constant maturity" having the particular
Index Maturity as otherwise announced by the Federal Reserve Bank
of New York for the week or month, as applicable, ended
immediately preceding the week or month, as applicable, in which
the particular Interest Determination Date falls; or (d) if the
rate referred to in clause (c) is not so published, the rate on
the particular Interest Determination Date calculated by the
Calculation Agent as a yield to maturity based on the arithmetic
mean of the secondary market bid prices at approximately 3:30
P.M., New York City time, on that Interest Determination Date of
three Reference Dealers selected by the Calculation Agent from
five Reference Dealers selected by the Calculation Agent and
eliminating the highest quotation, or, in the event of equality,
one of the highest, and the lowest quotation or, in the event of
equality, one of the lowest, for United States Treasury
securities with an original maturity equal to the particular
Index Maturity, a remaining term to maturity no more than one
year shorter than that Index Maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at that time; or (e) if fewer than five but more
than two of the prices referred to in clause (d) are provided as
requested, the rate on the particular Interest Determination Date
calculated by the Calculation Agent based on the arithmetic mean
of the bid prices obtained and neither the highest nor the lowest
9
of the quotations shall be eliminated; or (f) if fewer than three
prices referred to in clause (d) are provided as requested, the
rate on the particular Interest Determination Date calculated by
the Calculation Agent as a yield to maturity based on the
arithmetic mean of the secondary market bid prices as of
approximately 3:30 P.M., New York City time, on that Interest
Determination Date of three Reference Dealers selected by the
Calculation Agent from five Reference Dealers selected by the
Calculation Agent and eliminating the highest quotation or, in
the event of equality, one of the highest and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity
greater than the particular Index Maturity, a remaining term to
maturity closest to that Index Maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at the time; or (g) if fewer than five but more
than two prices referred to in clause (f) are provided as
requested, the rate on the particular Interest Determination Date
calculated by the Calculation Agent based on the arithmetic mean
of the bid prices obtained and neither the highest nor the lowest
of the quotations will be eliminated; or (h) if fewer than three
prices referred to in clause (f) are provided as requested, the
CMT Rate in effect on that Interest Determination Date; provided
that if no CMT Rate is then in effect, the interest rate that
will be effective as of the next Interest Reset Date will be the
Initial Interest Rate.
If two United States Treasury securities with an original
maturity greater than the Index Maturity specified on the face
hereof have remaining terms to maturity equally close to the
particular Index Maturity, the quotes for the United States
Treasury security with the shorter original remaining term to
maturity will be used.
(C) Commercial Paper Rate Notes. If the Interest Rate Basis is the
Commercial Paper Rate, the Notes shall be deemed to be "Commercial
Paper Rate Notes." Commercial Paper Rate Notes will bear interest for
each Interest Reset Date at the interest rate calculated with
reference to the Commercial Paper Rate and the Spread or Spread
Multiplier, if any. The Calculation Agent will determine the
Commercial Paper Rate on each applicable Interest Determination Date.
The Interest Determination Date is the second Business Day preceding
the related Interest Reset Date.
"Commercial Paper Rate" means: (1) the Money Market Yield
(calculated as described below) on the Interest Determination
Date of the rate for commercial paper having the applicable Index
Maturity as such rate is published in H.15(519) under the heading
"Commercial Paper--Nonfinancial;" or (2) if the rate referred to
in clause (1) is not published by 3:00 P.M., New York City time,
on the Calculation Date pertaining to such Interest Determination
Date, then the Commercial Paper Rate shall be the Money Market
Yield on the particular Interest Determination Date of the rate
for commercial paper having the particular Index Maturity as
published on H.15 Daily Update or such other recognized
electronic source used for the purpose of displaying the
applicable rate, under the caption "Commercial
Paper--Nonfinancial"; or (3) if the rate referred to in clause
(2) is not published by 3:00 P.M., New York City time, on the
Calculation Date, then the Commercial Paper Rate as calculated by
the Calculation Agent shall be the Money Market Yield of the
arithmetic mean of the offered rates at approximately 11:00 A.M.,
New York City time, on that Interest Determination Date of three
leading dealers of United States dollar commercial paper in The
City of New York (which may include the Agents or their
affiliates) selected by the Calculation Agent for commercial
paper having the particular Index Maturity placed for industrial
issuers whose bond rating is "Aa" by Moody's or the equivalent
from another nationally recognized statistical rating
organization; or (4) if the dealers so selected by the
Calculation Agent are not quoting as mentioned in clause (3), the
Commercial Paper Rate in effect on the particular Interest
Determination Date; provided that if no Commercial Paper Rate is
then in effect, the interest rate that will be effective as of
the next Interest Reset Date will be the Initial Interest Rate.
"Money Market Yield" shall be a yield (expressed as a percentage)
calculated in accordance with the following formula:
10
Money Market Yield = D x 360 x 100
----------------------
360 - (D x M)
where "D" refers to the per annum rate for the commercial paper,
quoted on a bank discount basis and expressed as a decimal; and
"M" refers to the actual number of days in the applicable
Interest Period.
(D) Constant Maturity Swap Rate Notes. If the Interest Basis is the
Constant Maturity Swap Rate, the Notes shall be deemed to be "Constant
Maturity Swap Rate Notes." Constant Maturity Swap Rate Notes will bear
interest at the interest rate calculated with reference to the
Constant Maturity Swap Rate and the Spread or Spread Multiplier, if
any. The Calculation Agent will determine the Constant Maturity Swap
Rate on each applicable Interest Determination Date. The Interest
Determination Date is the second U.S. Government Securities Business
Day (as defined below) preceding the related Interest Reset Date;
provided, however, that if, after attempting to determine the Constant
Maturity Swap Rate (as described below), such rate is not determinable
for a particular Interest Determination Date (the "Original Interest
Determination Date"), then such Interest Determination Date shall be
the first U.S. Government Securities Business Day preceding the
Original Interest Determination Date for which the Constant Maturity
Swap Rate can be determined as described below.
Constant Maturity Swap Rate" means: (1) the rate for U.S. Dollar
swaps with the designated maturity specified on the face hereof,
expressed as a percentage, which appears on the Reuters Screen
ISDAFIX1 Page as of 11:00 A.M., New York City time, on the
particular Interest Determination Date; or (2) if the rate
referred to in clause (1) does not appear on the Reuters Screen
ISDAFIX1 Page by 2:00 P.M., New York City time, on such Interest
Determination Date, a percentage determined on the basis of the
mid-market semi-annual swap rate quotations provided by the
Reference Banks (as defined below) as of approximately 11:00
A.M., New York City time, on such Interest Determination Date,
and, for this purpose, the semi-annual swap rate means the mean
of the bid and offered rates for the semi-annual fixed leg,
calculated on a 30/360 day count basis, of a fixed-for-floating
U.S. Dollar interest rate swap transaction with a term equal to
the designated maturity specified in the face hereof commencing
on the Interest Reset Date and in a Representative Amount (as
defined below) with an acknowledged dealer of good credit in the
swap market, where the floating leg, calculated on an Actual/360
day count basis, is equivalent to USD-LIBOR-BBA with a designated
maturity specified on the face hereof. The Calculation Agent will
request the principal New York City office of each of the
Reference Banks to provide a quotation of its rate. If at least
three quotations are provided, the rate for that Interest
Determination Date will be the arithmetic mean of the quotations,
eliminating the highest quotation (or, in the event of equality,
one of the highest) and the lowest quotation (or, in the event of
equality, one of the lowest).
"U.S. Government Securities Business Day" means any day except
for Saturday, Sunday, or a day on which The Bond Market
Association recommends that the fixed income departments of its
members be closed for the entire day for purposes of trading in
U.S. government securities.
"Representative Amount" means an amount that is representative
for a single transaction in the relevant market at the relevant
time.
11
"Reference Banks" mean five leading swap dealers in the New York
City interbank market, selected by the Calculation Agent, after
consultation with Allstate Life Insurance Company ("Allstate
Life").
(E) Federal Funds Open Rate Notes. If the Interest Basis is the Federal
Funds Open Rate, the Notes shall be deemed to be "Federal Funds Open
Rate Notes." Federal Funds Open Rate Notes will bear interest at the
interest rate calculated with reference to the Federal Funds Open Rate
and the Spread or Spread Multiplier, if any. The Calculation Agent
will determine the Federal Funds Open Rate on each applicable Interest
Determination Date. The Interest Determination Date is the related
Interest Reset Date.
"Federal Funds Open Rate" means the rate set forth on Moneyline
Telerate Page 5 for an Interest Reset Date underneath the caption
"FEDERAL FUNDS" in the row titled "OPEN". If the rate is not
available for an Interest Reset Date, the rate for that Interest
Reset Date shall be the Federal Funds Rate as determined below.
(F) Federal Funds Rate Notes. If the Interest Rate Basis is the Federal
Funds Rate, the Notes shall be deemed to be "Federal Funds Rate
Notes." Federal Funds Rate Notes will bear interest for each Interest
Reset Date at the interest rate calculated with reference to the
Federal Funds Rate and the Spread or Spread Multiplier, if any. The
Calculation Agent will determine the Federal Funds Rate on each
applicable Interest Determination Date. The Interest Determination
Date is the Business Day immediately preceding the related Interest
Reset Date.
"Federal Funds Rate" means: (1) the rate on the particular
Interest Determination Date for United States dollar federal
funds as published in H.15(519) under the caption "Federal Funds
(Effective)" and displayed on Moneyline Telerate (or any
successor service) on page 120 (or any other page as may replace
the specified page on that service) ("Moneyline Telerate Page
120"); or (2) if the rate referred to in clause (1) does not so
appear on Moneyline Telerate Page 120 or is not so published by
3:00 P.M., New York City time, on the related Calculation Date,
the rate on the particular Interest Determination Date for United
States dollar federal funds as published in H.15 Daily Update, or
such other recognized electronic source used for the purpose of
displaying the applicable rate, under the caption "Federal Funds
(Effective)"; or (3) if the rate referred to in clause (2) is not
so published by 3:00 P.M., New York City time, on the related
Calculation Date, the rate on the particular Interest
Determination Date calculated by the Calculation Agent as the
arithmetic mean of the rates for the last transaction in
overnight United States dollar federal funds arranged by three
leading brokers of United States dollar federal funds
transactions in The City of New York (which may include the
Agents or their affiliates), selected by the Calculation Agent
prior to 9:00 A.M., New York City time, on the business day
following that Interest Determination Date; or (4) if the brokers
so selected by the Calculation Agent are not quoting as mentioned
in clause (3), the Federal Funds Rate in effect on the particular
Interest Determination Date; provided that if no Federal Funds
Rate is then in effect, the interest rate that will be effective
as of the next Interest Reset Date will be the Initial Interest
Rate.
(G) LIBOR Notes. If the Interest Rate Basis is LIBOR (as defined below),
the Notes shall be deemed to be "LIBOR Notes." LIBOR Notes will bear
interest for each Interest Period at the interest rate calculated with
reference to LIBOR and the Spread or Spread Multiplier, if any. On
each applicable Interest Determination Date the Calculation Agent will
determine LIBOR. The applicable Interest Determination Date is the
second London Banking Day (as defined below) preceding the related
Interest Reset Date.
LIBOR means: (1) if "LIBOR Moneyline Telerate" is specified on
the face hereof or if neither "LIBOR Reuters" nor "LIBOR
Moneyline Telerate" is specified on the face hereof as the method
for calculating LIBOR, the rate for deposits in the LIBOR
12
Currency (as defined below) having the Index Maturity specified
on the face hereof, commencing on the related Interest Reset
Date, that appears on the LIBOR Page (as defined below) as of
11:00 A.M., London time, on the particular Interest Determination
Date; or (2) if "LIBOR Reuters" is specified on the face hereof,
the arithmetic mean of the offered rates, calculated by the
Calculation Agent, or the offered rate, if the LIBOR Page by its
terms provides only for a single rate, for deposits in the LIBOR
Currency having the particular Index Maturity, commencing on the
related Interest Reset Date, that appear or appears, as the case
may be, on the LIBOR Page as of 11:00 A.M., London time, on the
particular Interest Determination Date; or (3) if fewer than two
offered rates appear, or no rate appears, as the case may be, on
the particular Interest Determination Date on the LIBOR Page as
specified in clause (1) or (2), as applicable, the rate
calculated by the Calculation Agent of at least two offered
quotations obtained by the Calculation Agent after requesting the
principal London offices of each of four major reference banks
(which may include affiliates of the Agents), in the London
interbank market to provide the Calculation Agent with its
offered quotation for deposits in the LIBOR Currency for the
period of the particular Index Maturity, commencing on the
related Interest Reset Date, to prime banks in the London
interbank market at approximately 11:00 A.M., London time, on
that Interest Determination Date and in a principal amount that
is representative for a single transaction in the LIBOR Currency
in that market at that time; or (4) if fewer than two offered
quotations referred to in clause (3) are provided as requested,
the rate calculated by the Calculation Agent as the arithmetic
mean of the rates quoted at approximately 11:00 A.M., in the
applicable Principal Financial Center, on the particular Interest
Determination Date by three major banks (which may include
affiliates of the Agents), in that Principal Financial Center
selected by the Calculation Agent for loans in the LIBOR Currency
to leading European banks, having the particular Index Maturity
and in a principal amount that is representative for a single
transaction in the LIBOR Currency in that market at that time, or
(5) if the banks so selected by the Calculation Agent are not
quoting as mentioned in clause (4), LIBOR in effect on the
particular Interest Determination Date; provided that if no LIBOR
is then in effect, the interest rate that will be effective as of
the next Interest Reset Date will be the Initial Interest Rate.
"LIBOR Currency" means United States dollars.
"LIBOR Page" means either: (1) if "LIBOR Reuters" is specified on
the face hereof, the display on the Reuter Monitor Money Rates
Service (or any successor service) on the page specified on the
face hereof (or any other page as may replace that page on that
service) for the purpose of displaying the London interbank rates
of major banks for the LIBOR Currency; or (2) if "LIBOR Moneyline
Telerate" is specified on the face hereof or neither "LIBOR
Reuters" nor "LIBOR Moneyline Telerate" is specified on the face
hereof as the method for calculating LIBOR, the display on
Moneyline Telerate (or any successor service) on the page
specified on the face hereof (or any other page as may replace
such page on such service) for the purpose of displaying the
London interbank rates of major banks for the LIBOR Currency.
"London Banking Day" means a day on which commercial banks are
open for business (including dealing in the LIBOR Currency) in
London.
(H) Prime Rate Notes. If the Interest Rate Basis is the Prime Rate, the
Notes shall be deemed to be "Prime Rate Notes." Prime Rate Notes will
bear interest for each Interest Reset Date calculated with reference
to the Prime Rate and the Spread or Spread Multiplier, if any, subject
to the Minimum Interest Rate and/or Maximum Interest Rate, if any,
specified on the face hereof. The Calculation Agent will determine the
Prime Rate for each Interest Reset Date on each applicable Interest
Determination Date. The Interest Determination Date is the Business
Day immediately preceding the related Interest Reset Date.
"Prime Rate" means: (1) the rate on the particular Interest
Determination Date as published in H.15(519) under the caption
"Bank Prime Loan"; or (2) if the rate referred to in clause (1)
13
is not so published by 3:00 P.M., New York City time, on the
related Calculation Date, the rate on the particular Interest
Determination Date as published in H.15 Daily Update, or such
other recognized electronic source used for the purpose of
displaying the applicable rate, under the caption "Bank Prime
Loan"; or (3) if the rate referred to in clause (2) is not so
published by 3:00 P.M., New York City time, on the related
Calculation Date, the rate on the particular Interest
Determination Date calculated by the Calculation Agent as the
arithmetic mean of the rates of interest publicly announced by
each bank that appears on the Reuters Screen US PRIME 1 Page (as
defined below) as the applicable bank's prime rate or base
lending rate as of 11:00 A.M., New York City time, on that
Interest Determination Date; or (4) if fewer than four rates
referred to in clause (3) are so published by 3:00 P.M., New York
City time, on the related Calculation Date, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent as the arithmetic mean of the prime rates or
base lending rates quoted on the basis of the actual number of
days in the year divided by a 360-day year as of the close of
business on that Interest Determination Date by three major banks
(which may include affiliates of the Agents) in The City of New
York selected by the Calculation Agent; or (5) if the banks so
selected by the Calculation Agent are not quoting as mentioned in
clause (4), the Prime Rate in effect on the particular Interest
Determination Date; provided that if no Prime Rate is then in
effect, the interest rate that will be effective as of the next
Interest Reset Date will be the Initial Interest Rate.
"Reuters Screen US PRIME 1 Page" means the display on the Reuter
Monitor Money Rates Service (or any successor service) on the "US
PRIME 1" page (or any other page as may replace that page on that
service) for the purpose of displaying prime rates or base
lending rates of major United States banks.
(I) Treasury Rate Notes. If the Interest Rate Basis is the Treasury Rate,
the Notes shall be deemed to be "Treasury Rate Notes." Treasury Rate
Notes will bear interest for each Interest Reset Date at the interest
rate calculated with reference to the Treasury Rate and the Spread or
Spread Multiplier, if any. The Calculation Agent will determine the
Treasury Rate on each Treasury Rate Determination Date (as defined
below).
"Treasury Rate" means: (1) the rate from the auction held on the
Treasury Rate Interest Determination Date (the "Auction") of
direct obligations of the United States ("Treasury Bills") having
the Index Maturity specified on the face hereof under the caption
"INVESTMENT RATE" on the display on Moneyline Telerate (or any
successor service) on page 56 (or any other page as may replace
that page on that service) ("Moneyline Telerate Page 56") or page
57 (or any other page as may replace that page on that service)
("Moneyline Telerate Page 57"); or (2) if the rate referred to in
clause (1) is not so published by 3:00 P.M., New York City time,
on the related Calculation Date, the Bond Equivalent Yield (as
defined below) of the rate for the applicable Treasury Bills as
published in H.15 Daily Update, or another recognized electronic
source used for the purpose of displaying the applicable rate,
under the caption "U.S. Government Securities/Treasury
Bills/Auction High"; or (3) if the rate referred to in clause (2)
is not so published by 3:00 P.M., New York City time, on the
related Calculation Date, the Bond Equivalent Yield of the
auction rate of the applicable Treasury Bills as announced by the
United States Department of the Treasury; or (4) if the rate
referred to in clause (3) is not so announced by the United
States Department of the Treasury, or if the Auction is not held,
the Bond Equivalent Yield of the rate on the particular Interest
Determination Date of the applicable Treasury Bills as published
in H.15(519) under the caption "U.S. Government
Securities/Treasury Bills/Secondary Market"; or (5) if the rate
14
referred to in clause (4) is not so published by 3:00 P.M., New
York City time, on the related Calculation Date, the rate on the
particular Interest Determination Date of the applicable Treasury
Bills as published in H.15 Daily Update, or another recognized
electronic source used for the purpose of displaying the
applicable rate, under the caption "U.S. Government
Securities/Treasury Bills/Secondary Market"; or (6) if the rate
referred to in clause (5) is not so published by 3:00 P.M., New
York City time, on the related Calculation Date, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent as the Bond Equivalent Yield of the arithmetic
mean of the secondary market bid rates, as of approximately 3:30
P.M., New York City time, on that Interest Determination Date, of
three primary United States government securities dealers (which
may include the Agents or their affiliates) selected by the
Calculation Agent, for the issue of Treasury Bills with a
remaining maturity closest to the Index Maturity specified on the
face hereof; or (7) if the dealers so selected by the Calculation
Agent are not quoting as mentioned in clause (6), the Treasury
Rate in effect on the particular Interest Determination Date;
provided that if no Treasury Rate is then in effect, the interest
rate that will be effective as of the next Interest Reset Date
will be the Initial Interest Rate.
"Bond Equivalent Yield" means a yield (expressed as a percentage)
calculated in accordance with the following formula:
Bond Equivalent Yield = D x N x 100
-------------------
360 - (D x M)
where "D" refers to the applicable per annum rate for Treasury
Bills quoted on a bank discount basis and expressed as a decimal,
"N" refers to 365 or 366, as the case may be, and "M" refers to
the actual number of days in the applicable Interest Period.
The "Treasury Rate Determination Date" for each Interest Reset
Date means the day in the week in which the related Interest
Reset Date falls on which day Treasury Bills are normally
auctioned (i.e., Treasury Bills are normally sold at auction on
Monday of each week, unless that day is a legal holiday, in which
case the auction is normally held on the following Tuesday,
except that the auction may be held on the preceding Friday);
provided, however, that if an auction is held on the Friday of
the week preceding the related Interest Reset Date, the Interest
Determination Date will be the preceding Friday.
(J) Regular Floating Rate Notes. Unless the Notes are designated as
Floating Rate/Fixed Rate Notes or as having an Addendum attached or
having other/additional provisions apply, in each case relating to a
different interest rate formula, such Notes that bear interest at
floating rates will be Regular Floating Rate Notes and will bear
interest at the rate determined by reference to the applicable
Interest Rate Basis or Bases plus or minus the applicable Spread, if
any, and/or multiplied by the applicable Spread Multiplier, if any.
Commencing on the first Interest Reset Date, as specified on the face
hereof, the rate at which interest on Regular Floating Rate Notes is
payable will be reset as of each Interest Reset Date; provided,
however, that the interest rate in effect for the period, if any, from
the date of issue to the first Interest Reset Date will be the Initial
Interest Rate.
(K) Floating Rate/Fixed Rate Notes. If the Notes are designated as
"Floating Rate/Fixed Rate Notes" on the face hereof, such Notes that
bear interest at floating rates will bear interest at the rate
determined by reference to the applicable Interest Rate Basis or Bases
plus or minus the applicable Spread, if any, and/or multiplied by the
applicable Spread Multiplier, if any. Commencing on the first Interest
Reset Date, the rate at which interest on Floating Rate/Fixed Rate
Notes is payable will be reset as of each Interest Reset Date;
provided, however, that the interest rate in effect for the period, if
any, from the date of issue to the first Interest Reset Date will be
the Initial Interest Rate, as specified on the face hereof; and the
interest rate in effect commencing on the Fixed Rate Commencement Date
will be the Fixed Interest Rate, if specified on the face hereof, or,
if not so specified, the interest rate in effect on the day
immediately preceding the Fixed Rate Commencement Date.
SECTION 4. Optional Redemption. Except in the case of Discount Notes, if an
Initial Redemption Date is specified on the face hereof, the Trust may redeem
the Notes prior to the Stated Maturity Date at its option on any Business Day on
or after the Initial Redemption Date in whole or from time to time in part in
increments of $1,000 or any other integral multiple of an authorized
denomination specified on the face hereof (provided that any remaining principal
amount of the Notes shall be at least $1,000 or other minimum authorized
denomination applicable thereto), at the applicable Redemption Price (as defined
below), together with unpaid interest accrued on the Notes, any Additional
Amounts and other amounts payable with respect thereto to the date of
redemption. The Trust must give written notice to the Holders of the Notes to be
redeemed at its option not more than 60 nor less than 30 calendar days prior to
the date of redemption. "Redemption Price" means an amount equal to the Initial
Redemption Percentage specified on the face hereof (as adjusted by the Annual
Redemption Percentage Reduction, if applicable) multiplied by the unpaid
principal amount of Notes represented by this Note Certificate to be redeemed.
The Initial Redemption Percentage, if any, shall decline at each anniversary of
the Initial Redemption Date by an amount equal to the applicable Annual
Redemption Percentage Reduction, if any, until the Redemption Price is equal to
100% of the unpaid amount thereof to be redeemed.
SECTION 5. Repayment Provisions.
If the face of this Note Certificate specifies that "Survivor's Option" (as
defined below) applies, the person (the "Authorized Representative") who has
legal authority to act on behalf of the estate of the deceased owner of a
beneficial interest in the Notes represented hereby shall have the option to
elect repayment of the Notes in whole or in part in increments of U.S.$1,000
(provided that any remaining principal amount of the Notes shall be at least
U.S.$1,000), following the death of such beneficial owner (a "Survivor's
Option"). No Survivor's Option may be exercised unless such beneficial interest
was held by the beneficial owner for a period of at least six months prior to
the death of the beneficial owner.
Pursuant to the valid exercise of the Survivor's Option, if applicable, the
Trust shall repay the Notes represented hereby (or portion thereof) at a price
equal to 100% of the unpaid principal amount of the Notes to be repaid, together
with unpaid interest accrued thereon to, but excluding, the Repayment Date,
subject to the limitations in the next succeeding sentence. Allstate Life may,
in its sole discretion, limit the aggregate principal amount of (i) all Funding
Agreements securing all outstanding series of notes issued under the Allstate
Life(R) CoreNotes(R) program as to which exercises of any put option by any
issuing trust shall be accepted by Allstate Life in any calendar year to an
amount equal to the greater of $2,000,000 or 2% of the aggregate principal
amount of all Funding Agreements securing all outstanding series of notes issued
under the Allstate Life(R) CoreNotes(R) program as of the end of the most recent
calendar year or such other greater amount as determined in accordance with the
applicable Funding Agreement(s) and set forth on the face hereof; (ii) the
Funding Agreement(s) securing the Notes as to which exercises of any put option
by the Trust attributable to Notes as to which the Survivor's Option has been
exercised by the Authorized Representative of any individual deceased beneficial
owner to $250,000 in any calendar year or such other greater amount as
determined in accordance with the applicable Funding Agreement(s) and set forth
on the face hereof; and (iii) the Funding Agreement(s) securing the Notes as to
which exercises of any put option by the Trust shall be accepted in any calendar
year to an amount as set forth in the applicable Funding Agreement(s) and on the
face hereof.
In any such event, the Trust shall similarly be required to limit the
aggregate principal amount of Notes as to which exercises of the Survivor's
Option shall be accepted by it.
Each election to exercise the Survivor's Option shall be effected in the
order received by the Administrator. Notes that are not repaid in any calendar
year due to the application of the limits described above will be treated as
though they had been tendered on the first day of the following calendar year in
the order in which they were originally tendered. Subject to the limitations
described above, Notes accepted for repayment will be repaid on the first
interest payment date that occurs 20 or more calendar days after the date of the
acceptance unless that interest payment date is not a Business Day, in which
case the repayment date will be the next succeeding Business Day.
To exercise the Survivor's Option, the Authorized Representative must
provide to the DTC participant (the "Participant") through which the relevant
beneficial interest is owned (i) a written instruction to notify the Depositary
of the Authorized Representative's desire to exercise the Survivor's Option,
(ii) appropriate evidence (A) that the person has authority to act on behalf of
the deceased owner, (B) of the death of a owner of beneficial interest in the
Notes represented hereby, (C) that the deceased was the beneficial owner of the
Notes at the time of death and (D) that the deceased was the owner of a
beneficial interest in the Notes represented hereby at least six months prior to
the date of death of such beneficial owner, (iii) if beneficial interest in the
Notes represented hereby is held by a nominee of the deceased owner, a
certificate from the nominee attesting to the deceased owner's ownership of a
beneficial interest in
16
the Notes represented hereby, (iv) a written request for repayment,
substantially in the form of the attached Election Repayment Form", signed by
the Authorized Representative for the deceased owner with signature guaranteed
by a member firm of a registered national securities exchange or of the National
Association of Securities Dealers, Inc. or a commercial bank or trust company
having an office or correspondent in the United States, (v) if applicable, a
properly executed assignment or endorsement, (vi) tax waivers and any other
instruments or documents reasonably required to establish the validity of the
deceased's beneficial ownership in the Notes and the Authorized Representative's
entitlement to payment and (vii) any additional information reasonably required
to document ownership or authority to exercise the Survivor's Option and to
cause the repayment of the Notes (or portion thereof). Such Participant shall
provide to the Indenture Trustee a properly completed Repayment Election Form,
which is attached hereto as Annex A, to exercise the Survivor's Option, together
with evidence satisfactory to the Indenture Trustee from the Participant stating
that it represents the deceased owner of the beneficial interest in the Notes
represented hereby.
Subject to Allstate Life's right hereunder to limit the aggregate principal
amount of Funding Agreements securing notes as to which exercises of any put
option by the issuing trusts attributable to notes as to which exercises of the
Survivor's Option shall be accepted in any one calendar year, all questions as
to the eligibility or validity of any exercise of the Survivor's Option will be
determined by the Administrator, in its sole discretion. The Administrator's
determination shall be final and binding.
The death of a person owning a Note or beneficial interest therein in joint
tenancy or tenancy by the entirety with another person or persons shall be
deemed to be the death of the Holder or beneficial owner, as the case may be, of
such Note, and the entire principal amount of such Note or beneficial interest
therein shall be eligible for repayment pursuant to the Survivor's Option. The
death of a person owning a Note or beneficial interest therein by tenancy in
common shall be deemed to be the death of the Holder or beneficial owner, as the
case may be, of such Note only to the extent of the interest of the deceased
Holder or beneficial owner in such Note unless such Note or beneficial interest
therein is held by husband and wife as tenants in common, in which case, the
death of either spouse shall be deemed to be the death of the Holder or
beneficial owner, as the case may be, of such Note, and the entire principal
amount of such Note or beneficial interest therein shall be eligible for
repayment pursuant to the Survivor's Option.
The death of a person who, during his or her lifetime, was entitled to
substantially all of the interests of beneficial ownership of a Note shall be
deemed to be the death of the Holder or beneficial owner, as the case may be, of
such Note if such interests can be established to the satisfaction of the
Administrator.
In the event of repayment of the Notes in part only, a new Note Certificate
of like tenor in a principal amount equal to the unrepaid portion of principal
of Notes represented by this Note Certificate and otherwise having the same
terms and provisions as the Notes shall be issued by the Trust in the name of
the Holder of this Note Certificate upon the presentation and surrender of this
Note Certificate.
SECTION 6. Sinking Fund. Unless otherwise specified on the face hereof, the
Notes will not be subject to any sinking fund.
SECTION 7. Registration, Transfer And Exchange. As provided in the Standard
Indenture Terms and subject to certain limitations therein and herein set forth,
the transfer of the Notes represented by this Note Certificate is registrable in
the records of the Registrar. Upon surrender of this Note Certificate for
registration of transfer at the office or agency of the Trust in any place where
the principal of and interest on the Notes are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Trust and the Registrar duly executed by, the Holder or by his or her attorney
duly authorized in writing, and thereupon one or more new Note Certificates
having the same terms and provisions, in authorized denominations and for the
same aggregate principal amount, will be issued by the Trust to the designated
transferee or transferees.
As provided in the Standard Indenture Terms and subject to certain
limitations therein and herein set forth, the Notes represented by this Note
Certificate are exchangeable for a like aggregate principal amount of Notes in
authorized denominations but otherwise having the same terms and provisions, as
requested by the Holder of this Note Certificate surrendering the same.
17
No service charge shall be made for any such registration of transfer or
exchange, but the Trust or Indenture Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith.
Prior to due presentment of this Note Certificate for registration of
transfer, the Trust, the Indenture Trustee and any agent of the Trust or the
Indenture Trustee may treat the Holder as the owner of the Notes for all
purposes, including receiving payment of principal of and interest on the Notes,
whether or not the Notes be overdue, and neither the Trust, the Indenture
Trustee nor any such agent shall be affected by notice to the contrary, except
as required by law.
SECTION 8. Certificated Notes. Under certain circumstances described in the
Standard Indenture Terms, the Trust will issue Certificated Notes in exchange
for the Book-Entry Notes represented by a Global Security. The Certificated
Notes issued in exchange for any Book-Entry Notes represented by a Global
Security shall be of like tenor and of an equal aggregate principal amount, in
authorized denominations. Such Certificated Notes shall be registered in the
name or names of such person or persons as the Depositary shall instruct the
Registrar.
SECTION 9. Modifications and Amendments. Sections [9.1 and 9.2] of the
Standard Indenture Terms contain provisions permitting the Trust and the
Indenture Trustee (1) without the consent of any Holder, to execute Supplemental
Indentures for limited purposes and take other actions set forth in the Standard
Indenture Terms, and (2) with the consent of the Holders of not less than
66(2)/3% in aggregate principal amount of Notes at the time outstanding,
evidenced as in the Standard Indenture Terms, to execute Supplemental Indentures
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Indenture or any Supplemental Indenture or modifying in any
manner the rights of the Holders of the Notes subject to specified limitations.
SECTION 10. Obligations Unconditional. No reference herein to the Indenture
or the Standard Indenture Terms and no provision of the Notes or of the
Indenture shall alter or impair the obligation of the Trust, which is absolute
and unconditional, to pay the principal of, interest on, or any other amount due
and owing with respect to, the Notes at the places, at the respective times, and
at the rate herein prescribed.
SECTION 11. Collateral. Pursuant to the Indenture, the Trust will grant a
security interest in, pledge and collaterally assign the Collateral specified on
the face hereof to the Indenture Trustee on behalf of the holders of the Notes
and any other person for whose benefit the Indenture Trustee will be holding the
Collateral. The Notes will be secured by a first priority perfected security
interest in the Collateral in favor of the Indenture Trustee and the other
persons identified in the Standard Indenture Terms
SECTION 12. Security; Limited Recourse. The Notes are solely the
obligations of the Trust, and will not be guaranteed by any person, including
but not limited to Allstate Life, Allstate Life Global Funding, any Agent, the
Trust Beneficial Owner, the Delaware Trustee, the Indenture Trustee or any of
their affiliates. The Trust's obligations under the Notes will be secured by all
of the Trust's rights and title in one or more Funding Agreement(s) issued by
Allstate Life and other rights and assets included in the applicable Collateral.
The Holder of the Notes has no direct contractual rights against Allstate Life
under the Funding Agreement(s). Under the terms of each Funding Agreement,
recourse rights to Allstate Life will belong to the Trust, its successors and
permitted assignees. The Trust has pledged, collaterally assigned and granted a
first priority perfected security interest in the Collateral for the Notes to
the Indenture Trustee on behalf of the Holders of the Notes and the other
persons identified in the Standard Indenture Terms. Recourse to Allstate Life
under each Funding Agreement will be enforceable only by the Indenture Trustee
as a secured party on behalf of the Holders of Notes and the other persons
identified in the Standard Indenture Terms.
SECTION 13. Events Of Default. In case an Event of Default, as defined in
the Standard Indenture Terms, shall have occurred and be continuing, the
principal of the Notes may be declared, and upon such declaration shall become,
due and payable in the manner, with the effect and subject to the conditions
provided in the Indenture. If the Notes are Discount Notes, the amount of
principal of the Notes that becomes due and payable upon such acceleration shall
be equal to the amount calculated as set forth in Section 3 hereof.
SECTION 14. Withholding; Additional Amounts; Tax Event. All amounts due in
respect of the Notes will be made without withholding or deduction for or on
account of any present or future taxes, duties, levies, assessments or other
governmental charges of whatever nature imposed or levied by or on behalf of any
18
governmental authority in the United States having the power to tax on payments
on the Notes unless the withholding or deduction is required by law. Unless
otherwise specified on the face hereof, the Trust will not pay any additional
amounts ("Additional Amounts") to Holders of the Notes in the event that any
withholding or deduction is so required by law, regulation or official
interpretation thereof, and the imposition of a requirement to make any such
withholding or deduction will not give rise to any independent right or
obligation to redeem the Notes.
SECTION 15. Listing. Unless otherwise specified on the face hereof, the
Notes will not be listed on any securities exchange.
SECTION 16. No Recourse Against Certain Persons. No recourse shall be had
for the payment of the principal of or the interest on the Notes, or for any
claim based hereon, or otherwise in respect thereof, or based on or in respect
of the Indenture or any Supplemental Indenture, against the Nonrecourse Parties,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such personal
liability being, by the acceptance of any Notes and as part of the consideration
for issue of the Notes, expressly waived and released.
SECTION 17. Governing Law. Pursuant to Section 5-1401 of the General
Obligations Law of the State of New York, the Notes shall be governed by, and
construed in accordance with, the laws of the State of New York.
19
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this Note Certificate, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN
COM -- as tenants in common UNIF GIFT MIN Custodian
ACT ____ ____
(Cust) (Minor)
TEN ENT -- as tenants by the entireties
as joint tenants with right of survivorship under Uniform Gifts to Minors
JT TEN -- and not as tenants in common Act
(State)
CUST -- custodian
Additional abbreviations may also be used though not in
the above list.
ASSIGNMENT FORM
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto Please Insert Social Security
or Other Identifying Number of Assignee
[GRAPHIC OMITTED]
- -------------------------------------------------------------------------------
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
the within Security of THE ALLSTATE LIFE GLOBAL FUNDING TRUST SPECIFIED ON THE
FACE OF THIS NOTE CERTIFICATE and does hereby irrevocably constitute and appoint
attorney to transfer said Security on the books of the Issuer, with full power
of substitution in the premises.
Dated:
- -------------------------------------------------------------------------------
NOTICE: The signature to this assignment must correspond with the name as
written upon the face of the within instrument in every particular, without
alteration or enlargement or any change whatsoever.
20
ANNEX A
REPAYMENT ELECTION FORM
ALLSTATE LIFE GLOBAL FUNDING
ALLSTATE LIFE(R) CORENOTES(R)
CUSIP NO.
To: [Name of Trust]
The undersigned financial institution (the "Financial Institution")
represents the following:
o The Financial Institution has received a request for repayment from
the executor or other authorized representative (the "Authorized
Representative") of the deceased beneficial owner listed below (the
"Deceased Beneficial Owner") of Allstate Life(R) CoreNotes(R) (CUSIP
No. ) (the "Notes").
o At the time of his or her death, the Deceased Beneficial Owner owned
Notes in the principal amount listed below.
o The Deceased Beneficial Owner acquired the Notes at least six (6)
months before the date of death of such Deceased Beneficial Owner.
o The Financial Institution currently holds such Notes as a direct or
indirect participant in The Depository Trust Company (the
"Depositary").
The Financial Institution agrees to the following terms:
o The Financial Institution shall follow the instructions (the
"Instructions") accompanying this Repayment Election Form (this
"Form").
o The Financial Institution shall make all records specified in the
Instructions supporting the above representations available to J.P.
Morgan Trust Company, National Association (the "Trustee") or [Name of
Trust] (the "Trust") for inspection and review within five Business
Days of the Indenture Trustee's or the Trust's request.
o If the Financial Institution, the Indenture Trustee or the Trust, in
any such party's reasonable discretion, deems any of the records
specified in the Instructions supporting the above representations
unsatisfactory to substantiate a claim for repayment, the Financial
Institution shall not be obligated to submit this Form, and the
Indenture Trustee or the Trust may deny repayment. If the Financial
Institution cannot substantiate a claim for repayment, it shall notify
the Indenture Trustee and the Trust immediately.
o Repayment elections may not be withdrawn.
o The Financial Institution agrees to indemnify and hold harmless the
Indenture Trustee and the Trust against and from any and all claims,
liabilities, costs, losses, expenses, suits and damages resulting from
the Financial Institution's above representations and request for
repayment on behalf of the Authorized Representative.
o The Notes will be repaid on the first Interest Payment Date to occur
at least 20 calendar days after the date of acceptance of the Notes
for repayment, unless such date is not a business day, in which case
the date of repayment shall be the next succeeding business day.
o Subject to Allstate Life's right hereunder to limit the aggregate
principal amount of Funding Agreements securing notes as to which
exercises of any put option by the issuing trusts attributable to
notes as to which exercises of the Survivor's Option shall be accepted
A-1
in any one calendar year, all questions as to the eligibility or
validity of any exercise of the survivor's option will be determined
by the Indenture Trustee, in its sole discretion, which determination
shall be final and binding on all parties.
A-2
REPAYMENT ELECTION FORM
(1)
- -------------------------------------------------------------------------------
Name of Deceased Beneficial Owner
(2)
- -------------------------------------------------------------------------------
Date of Death
(3)
- -------------------------------------------------------------------------------
Name of Authorized Representative Requesting Repayment
(4)
- -------------------------------------------------------------------------------
Name of Financial Institution Requesting Repayment
(5)
- -------------------------------------------------------------------------------
Signature of Authorized Representative of Financial Institution
Requesting Repayment
(6)
- -------------------------------------------------------------------------------
Principal Amount of Requested Repayment
(7)
- -------------------------------------------------------------------------------
Date of Election
(8) Financial Institution (9) Wire instructions for payment:
Authorized Representative: Bank Name:
Name ABA Number:
Phone Number: Account Name:
Fax Number: Account Number:
Mailing Address (no P.O. Boxes): Reference (optional):
- -------------------------------------------------------------------------------
TO BE COMPLETED BY THE INDENTURE TRUSTEE:
(A) Election Number*:
(B) Delivery and Payment Date:
(C) Principal Amount:
(D) Accrued Interest:
(E) Date of Receipt of Form by the Indenture Trustee:
(F) Date of Acknowledgment by the Indenture Trustee:
___________________
* To be assigned by the Indenture Trustee upon receipt of this Form. An
acknowledgement, in the form of a copy of this document with the assigned
Election Number, will be returned to the party and location designated in
item (8) above.
A-3
INSTRUCTIONS FOR COMPLETING REPAYMENT ELECTION FORM AND EXERCISING
REPAYMENT OPTION
Capitalized terms used and not defined herein have the meanings defined in
the accompanying Repayment Election Form.
1. Collect and retain for a period of at least three years (1) satisfactory
evidence of the authority of the Authorized Representative, (2)
satisfactory evidence of death of the Deceased Beneficial Owner, (3)
satisfactory evidence that the Deceased Beneficial Owner beneficially
owned, at the time of his or her death, the Notes being submitted for
repayment, (4) satisfactory evidence that the Notes being submitted for
repayment were acquired by the Deceased Beneficial Owner at least six (6)
months before the date of the death of such Deceased Beneficial Owner, and
(5) any necessary tax waivers. For purposes of determining whether the
Notes will be deemed beneficially owned by an individual at any given time,
the following rules shall apply:
o If a Note (or a portion thereof) is beneficially owned by tenants by
the entirety or joint tenants, the Note (or relevant portion thereof)
will be regarded as beneficially owned by a single owner. Accordingly,
the death of a tenant by the entirety or joint tenant will be deemed
the death of the beneficial owner and the entire principal amount so
owned will become eligible for repayment.
o The death of a person beneficially owning a Note (or a portion
thereof) by tenancy in common will be deemed the death of the
beneficial owner only with respect to the deceased owner's interest in
the Note (or relevant portion thereof) so owned, unless a husband and
wife are the tenants in common, in which case the death of either will
be deemed the death of the beneficial owner and the entire principal
amount so owned will be eligible for repayment.
o A Note (or a portion thereof) beneficially owned by a trust will be
regarded as beneficially owned by each beneficiary of the trust to the
extent of that beneficiary's interest in the trust (however, a trust's
beneficiaries collectively cannot be beneficial owners of more Notes
than are owned by the trust). The death of a beneficiary of a trust
will be deemed the death of the beneficial owner of the Notes (or
relevant portion thereof) beneficially owned by the trust to the
extent of that beneficiary's interest in the trust. The death of an
individual who was a tenant by the entirety or joint tenant in a
tenancy which is the beneficiary of a trust will be deemed the death
of the beneficiary of the trust. The death of an individual who was a
tenant in common in a tenancy which is the beneficiary of a trust will
be deemed the death of the beneficiary of the trust only with respect
to the deceased holder's beneficial interest in the Note, unless a
husband and wife are the tenants in common, in which case the death of
either will be deemed the death of the beneficiary of the trust.
o The death of a person who, during his or her lifetime, was entitled to
substantially all of the beneficial interest in a Note (or a portion
thereof) will be deemed the death of the beneficial owner of that Note
(or relevant portion thereof), regardless of the registration of
ownership, if such beneficial interest can be established to the
satisfaction of the Indenture Trustee. Such beneficial interest will
exist in many cases of street name or nominee ownership, custodial
arrangements, ownership by a trustee, ownership under the Uniform
Transfers of Gifts to Minors Act and community property or other joint
ownership arrangements between spouses. Beneficial interest will be
evidenced by such factors as the power to sell or otherwise dispose of
a Note, the right to receive the proceeds of sale or disposition and
the right to receive interest and principal payments on a Note.
2. Indicate the name of the Deceased Beneficial Owner on line (1).
3. Indicate the date of death of the Deceased Beneficial Owner on line (2).
4. Indicate the name of the Authorized Representative requesting repayment on
line (3).
5. Indicate the name of the Financial Institution requesting repayment on
line(4).
A-4
6. Affix the authorized signature of the Financial Institution's
representative on line (5). THE SIGNATURE MUST BE MEDALLION SIGNATURE
GUARANTEED.
7. Indicate the principal amount of Notes to be repaid on line (6).
8. Indicate the date this Form was completed on line (7).
9. Indicate the name, mailing address (no P.O. boxes, please), telephone
number and facsimile-transmission number of the party to whom the
acknowledgment of this election may be sent in item (8).
10. Indicate the wire instruction for payment on line (9).
11. Leave lines (A), (B), (C), (D), (E) and (F) blank.
12. Mail or otherwise deliver an original copy of the completed Form to:
J.P. Morgan Trust Company, National Association
227 W. Monroe Street, Suite 2600
Chicago, IL 60606
13. FACSIMILE TRANSMISSIONS OF THE REPAYMENT ELECTION FORM WILL NOT BE
ACCEPTED.
14. If the acknowledgement of the Indenture Trustee's receipt of this Form,
including the assigned Election Number, is not received within 10 days of
the date such information is sent to the Trustee, contact the Trustee at
J.P. Morgan Trust Company, National Association, 227 W. Monroe Street,
Suite 2600, Chicago, IL 60606.
15. For assistance with this Form or any questions relating thereto, please
contact the Trustee at J.P. Morgan Trust Company, National Association, 227
W. Monroe Street, Suite 2600, Chicago, IL 60606.
A-5
Schedule I
I-1
EXHIBIT 4.11
FORM OF DEFINITIVE SECURITY FOR
ALLSTATE LIFE(R) CORENOTES(R) PROGRAM
[FACE OF DEFINITIVE SECURITY]
Unless this Note Certificate is presented by the Holder or an authorized
representative of the Holder to the Trust (hereinafter defined) or its agent for
registration or transfer, exchange or payment, any transfer, pledge or other use
hereof for value or otherwise by or to any person is wrongful inasmuch as the
registered Holder hereof has an interest herein.
This Note Certificate is a definitive security within the meaning of the
standard indenture terms (hereinafter defined) and is registered in the name of
the Holder (as defined in the standard indenture terms) hereof. This Note is not
exchangeable for a global security (as defined in the standard indenture terms).
CUSIP No.:
ALLSTATE LIFE GLOBAL FUNDING TRUST
ALLSTATE LIFE(R) CORENOTES(R)
Title of Notes: Stated Maturity Date:
Principal Amount: $ Securities Exchange Listing: [ ] Yes [ ] No. If yes,
Original Issue Date: indicate name(s) of Securities Exchange(s):
Issue Price:
Interest Rate or Formula:
Fixed Rate Notes: [ ] Yes [ ] No. If yes, Floating Rate Notes: [ ] Yes [ ] No. If yes,
Interest Rate: Regular Floating Rate Notes: [ ]
Interest Payment Dates: Floating Rate/Fixed Rate Notes: [ ]
Day Count Convention: Interest Rate:
Additional/Other Terms: Interest Rate Basis(es):
Discount Notes: [ ] Yes [ ] No. If yes, CD Rate [ ]
Total Amount of Discount: CMT Rate [ ]
Initial Accrual Period of Discount: Commercial Paper Rate [ ]
Additional/Other Terms: Constant Maturity Swap Rate [ ]
Redemption Provisions: [ ] Yes [ ] No. If yes, Federal Funds Open Rate [ ]
Initial Redemption Date: Federal Funds Rate [ ]
Initial Redemption Percentage: LIBOR [ ]
Annual Redemption Percentage Prime Rate [ ]
Reduction, if any: Treasury Rate [ ]
Additional/Other Terms: If LIBOR:
Survivor's Option: [ ] Yes [ ] No. [ ] LIBOR Moneyline Telerate:
Regular Interest Record Date(s): [ ] LIBOR Reuter:
Sinking Fund, if any: LIBOR Currency:
Calculation Agent: If CMT Rate:
Authorized Denominations: Designated CMT Moneyline Telerate Page:
Collateral: The right, title and interest of the Trust in If CMT Moneyline Telerate Page
and to: 7052:
(i) Allstate Life Insurance Company Funding [ ] Weekly Average Agreement
No(s). [ ]; (ii) all proceeds in respect of such [ ] Monthly Average Funding
Agreement(s); and (iii) all books and records Designated CMT Maturity
Index: (including, without limitation, computer programs, Index Maturity:
printouts, and other computer materials and files) Spread (+/-), if any:
pertaining to such Funding Agreement(s). Spread Multiplier, if any:
Initial Interest Rate, if any:
Initial Interest Reset Date:
Interest Reset Dates:
Interest Determination Date(s):
Interest Payment Dates:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Fixed Rate Commencement Date, if any:
Floating Rate Interest, if any:
Fixed Interest Rate, if any:
Day Count Convention:
Additional/Other Terms:
"Allstate Life(R)" is a registered servicemark of Allstate Insurance Company.
"CoreNotes(R)" is a registered servicemark of Merrill Lynch & Co., Inc.
This Note Certificate is a Definitive Security in respect of a duly
authorized issue of Notes (the "Notes") of the Allstate Life Global Funding
Trust designated above, a statutory trust organized under the laws of the State
of Delaware (the "Trust"). The Notes are issued under the Indenture, dated as of
the date hereof (as amended or supplemented from time to time, the "Indenture")
among the Trust and the other persons specified therein. Capitalized terms used
herein and not otherwise defined shall have the respective meanings ascribed in
the Standard Indenture Terms, which are incorporated by reference in and form a
part of the Indenture (as amended or supplemented from time to time, the
"Standard Indenture Terms").
The Trust, for value received, hereby promises to pay to the Holder hereof
or its registered assigns on the Stated Maturity Date (or on the date of
redemption or repayment by the Trust prior to maturity pursuant to redemption or
repayment provisions, in each case, if provided for above) the principal amount
specified above and, if so specified above, to pay interest from time to time on
the Notes represented by this Note Certificate from the Original Issue Date
specified above (the "Original Issue Date") or from the most recent Interest
Payment Date to which interest has been paid or duly provided for at the rate
per annum determined in accordance with the provisions on the reverse hereof and
as specified above, until the principal of the Notes represented by this Note
Certificate is paid or made available for payment and to pay such other amounts
due and owing with respect to the Notes represented by this Note Certificate.
On any exchange or purchase and cancellation of any of the Notes
represented by this Note Certificate, details of such exchange or purchase and
cancellation shall be entered in the records of the Indenture Trustee. Upon any
such exchange or purchase and cancellation, the principal amount of the Notes
represented by this Note Certificate shall be charged by the principal amount so
exchanged or purchased and cancelled, as provided in the Standard Indenture
Terms.
Unless otherwise set forth above, if the Notes are subject to an Annual
Redemption Percentage Reduction as specified above, the Redemption Price of the
Notes represented by this Note Certificate shall initially be the Initial
Redemption Percentage of the principal amount of the Notes represented by this
Note Certificate on the Initial Redemption Date and shall decline at each
anniversary of the Initial Redemption Date (each such date, a "Redemption Date")
by the Annual Redemption Percentage Reduction of such principal amount until the
Redemption Price is 100% of such principal amount.
The Notes will mature on the Stated Maturity Date, unless their principal
(or, any installment of their principal) becomes due and payable prior to the
Stated Maturity Date, whether, as applicable, by the declaration of acceleration
of maturity, notice of redemption at the option of the Trust, notice of the
Holder's option to elect repayment or otherwise (the Stated Maturity Date or any
date prior to the Stated Maturity Date on which the Notes become due and
payable, as the case may be, are referred to as the "Maturity Date" with respect
to principal of the Notes repayable on such date).
Unless otherwise provided above and except as provided in the following
paragraph, the Trust will pay interest on each Interest Payment Date specified
above, commencing with the first Interest Payment Date next succeeding the
Original Issue Date, and on the Maturity Date; provided that any payment of
principal, premium, if any,
2
interest or other amounts to be made on any Interest Payment Date or on a
Maturity Date that is not a Business Day shall be made in accordance with the
provisions set forth on the reverse hereof.
Unless otherwise specified above, the interest payable on each Interest
Payment Date or on the Maturity Date will be the amount equal to the interest
accrued from and including the immediately preceding Interest Payment Date in
respect of which interest has been paid or from and including the date of issue,
if no interest has been paid, to but excluding the applicable Interest Payment
Date or the Maturity Date, as the case may be (each, an "Interest Period").
Reference is hereby made to the further provisions of the Notes set forth
on the reverse hereof and, if so specified on the face hereof, in an Addendum
hereto, which further provisions shall for all purposes have the same force and
effect as if set forth on the face hereof.
Notwithstanding the foregoing, if an Addendum is attached hereto or
"Other/Additional Provisions" apply to the Notes as specified above, the Notes
shall be subject to the terms set forth in such Addendum or such
"Other/Additional Provisions."
The Notes represented by this Note Certificate shall not be valid or become
obligatory for any purpose until the certificate of authentication hereon shall
have been executed by the Indenture Trustee pursuant to the Indenture.
3
IN WITNESS WHEREOF, the Trust has caused this instrument to be duly
executed on its behalf.
Dated: Original Issue Date THE ALLSTATE LIFE GLOBAL FUNDING TRUST SPECIFIED ON THE
FACE OF THIS NOTE CERTIFICATE,
as Issuer
By: [WILMINGTON TRUST COMPANY],
not in its individual capacity,
but solely as Delaware Trustee
By:
---------------------------------
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This Note Certificate is one of the Note Certificates representing
Notes described in the within-mentioned Indenture.
[J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION],
Dated: Original Issue Date as Indenture Trustee
By:
------------------------------------------------------
Authorized Signatory
4
[REVERSE OF DEFINITIVE SECURITY]
SECTION 1. General. This Note Certificate is a Definitive Security in
respect of a duly authorized issue of Notes of the Trust. The Notes are issued
pursuant to the Indenture.
SECTION 2. Currency. The Notes are denominated in, and payments of
principal, premium, if any, and/or interest, if any, will be made in U.S.
dollars.
SECTION 3. Determination of Interest Rate and Other Payment Provisions.
Fixed Rate Notes. If the Notes are designated on the face hereof as "Fixed
Rate Notes," the Notes will bear interest from the Original Issue Date until the
Maturity Date. Unless otherwise specified on the face hereof, the rate of
interest payable on the Notes will not be adjusted; unless otherwise specified
on the face hereof, interest will be payable on the Interest Payment Dates set
forth on the face hereof and at the Maturity Date. Interest will be computed on
the basis of a 360-day year of twelve 30-day months. If any Interest Payment
Date or the Maturity Date of Fixed Rate Notes falls on a day that is not a
Business Day, any payments of principal, premium, if any, and/or interest or
other amounts required to be made, will be made on the next succeeding Business
Day, and no additional interest will accrue in respect of the payment made on
that next succeeding Business Day.
Discount Notes. If the Notes are designated on the face hereof as "Discount
Notes" (as defined below), payments in respect of the Notes shall be made as set
forth on the face hereof. In the event a Discount Note is redeemed, repaid or
accelerated, the amount payable to the Holder of such Note will be equal to the
sum of: (1) the Issue Price (increased by any accruals of discount) and, in the
event of any redemption of such Discount Notes, if applicable, multiplied by the
Initial Redemption Percentage (as adjusted by the Annual Redemption Percentage
Reduction, if applicable); and (2) any unpaid interest accrued on such Discount
Notes to the date of redemption, repayment or acceleration of maturity, as
applicable. For purposes of determining the amount of discount that has accrued
as of any date on which a redemption, repayment or acceleration of maturity of
the Notes occurs for Discount Notes, the discount will be accrued using a
constant yield method. The constant yield will be calculated using a 30-day
month, 360-day year convention, a compounding period that, except for the
Initial Period (as defined below), corresponds to the shortest period between
Interest Payment Dates for Discount Notes (with ratable accruals within a
compounding period), a coupon rate equal to the initial coupon rate applicable
to Discount Notes and an assumption that the maturity of such Discount Notes
will not be accelerated. If the period from the date of issue to the first
Interest Payment Date for Discount Notes (the "Initial Period") is shorter than
the compounding period for such Discount Notes, a proportionate amount of the
yield for an entire compounding period will be accrued. If the Initial Period is
longer than the compounding period, then the period will be divided into a
regular compounding period and a short period with the short period being
treated as provided in the preceding sentence. The accrual of the applicable
discount may differ from the accrual of original issue discount for purposes of
the Code, certain Discount Notes may not be treated as having original issue
discount within the meaning of the Code, and certain Notes other than Discount
Notes may be treated as issued with original issue discount for federal income
tax purposes. A "Discount Note" is any Note that has an Issue Price that is less
than 100% of the principal amount thereof by more than a percentage equal to the
product of 0.25% and the number of full years to the Stated Maturity Date. A
Discount Note may not bear any interest currently or may bear interest at a rate
that is below market rates at the time of issuance.
Floating Rate Notes. If the Notes are specified on the face hereof as
"Floating Rate Notes," interest on the Notes shall accrue and be payable in
accordance with this Section 3. A Floating Rate Note may be a CD Rate Note, CMT
Rate Note, Commercial Paper Rate Note, Constant Maturity Swap Rate Note, Federal
Funds Open Rate Note, Federal Funds Rate Note, LIBOR Note, Prime Rate Note or
Treasury Rate Note. If the Notes are designated on the face hereof as Floating
Rate Notes, the face hereof will specify whether the Notes are Regular Floating
Rate Notes or Floating Rate/Fixed Rate Notes. For the period from the date of
issue to, but not including, the first Interest Reset Date set forth on the face
hereof, the interest rate hereon shall be the Initial Interest Rate specified on
the face hereof. Thereafter, the interest rate hereon will be reset as of and be
effective as of each Interest Reset Date.
(A) If any Interest Reset Date would otherwise be a day that is not a
Business Day, such Interest Reset Date shall be postponed to the next
5
day that is a Business Day; provided, however, that if the Notes are
LIBOR Notes and such Business Day is in the next succeeding calendar
month, such Interest Reset Date shall be the Business Day immediately
preceding such Interest Reset Date.
(B) Unless specified otherwise on the face hereof, Interest Reset Dates
are as follows: (1) if the Notes reset daily, each Business Day; (2)
if the Notes reset weekly, other than Treasury Rate Notes, the
Wednesday of each week; (3) if the Notes are Treasury Rate Notes that
reset weekly, and except as provided below under "Treasury Rate
Notes," the Tuesday of each week; (4) if the Notes reset monthly, the
third Wednesday of each month; (5) if the Notes reset quarterly, the
third Wednesday of every third calendar month, beginning in the third
calendar month following the month in which the Notes were issued; (6)
if the Notes reset semiannually, the third Wednesday of each of the
two months specified on the face hereof; and (7) if the Notes reset
annually, the third Wednesday of the month specified on the face
hereof; provided, however, that with respect to Floating Rate/ Fixed
Rate Notes, the rate of interest thereon will not reset after the
particular Fixed Rate Commencement Date specified on the face hereof
(the "Fixed Rate Commencement Date").
(C) Accrued interest is calculated by multiplying the principal amount of
such Floating Rate Note by an accrued interest factor. The accrued
interest factor is computed by adding the interest factor calculated
for each day in the particular Interest Period. The interest factor
for each day will be computed by dividing the interest rate applicable
to such day by 360, in the case of Floating Rate Notes as to which the
CD Rate, the Commercial Paper Rate, the Federal Funds Open Rate, the
Federal Funds Rate, LIBOR or the Prime Rate is an applicable Interest
Rate Basis (as defined below), or by the actual number of days in the
year, in the case of Floating Rate Notes as to which the CMT Rate or
the Treasury Rate is an applicable Interest Rate Basis. In the case of
a Floating Rate Note as to which the Constant Maturity Swap Rate is
the Interest Rate Basis, the interest factor will be computed by
dividing the number of days in the interest period by 360 (the number
of days to be calculated on the basis of a year of 360 days with 12
30-day months (unless (i) the last day of the interest period is the
31st day of a month but the first day of the interest period is a day
other than the 30th or 31st day of a month, in which case the month
that includes that last day shall not be considered to be shortened to
a 30-day month, or (ii) the last day of the interest period is the
last day of the month of February, in which case the month of February
shall not be considered to be lengthened to a 30-day month)). The
interest factor for Floating Rate Notes as to which the interest rate
is calculated with reference to two or more Interest Rate Bases will
be calculated in each period in the same manner as if only the
applicable Interest Rate Basis specified on the face hereof applied.
The interest rate shall be set forth on the face hereof. For purposes
of making the foregoing calculation, the interest rate in effect on
any Interest Reset Date will be the applicable rate as reset on that
date. Unless otherwise specified on the face hereof, the interest rate
that is effective on the applicable Interest Reset Date will be
determined on the applicable Interest Determination Date and
calculated on the applicable Calculation Date (as defined below).
"Calculation Date" means the date by which the Calculation Agent
designated on the face hereof, is to calculate the interest rate which
will be the earlier of (1) the tenth calendar day after the particular
Interest Determination Date or, if such day is not a Business Day, the
next succeeding Business Day; or (2) the Business Day immediately
preceding the applicable Interest Payment Date or the Maturity Date,
as the case may be.
(D) Unless otherwise specified on the face hereof, all percentages
resulting from any calculation on Floating Rate Notes will be rounded
to the nearest one hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upwards. All dollar
amounts used in or resulting from any calculation on Floating Rate
Notes will be rounded to the nearest cent.
(E) Unless otherwise specified on the face hereof, if the Notes are
designated on the face hereof as Floating Rate Notes, if any Interest
Payment Date (other than the Maturity Date for the Notes) would
otherwise be a day that would not be a Business Day, such Interest
Payment Date would be postponed to the next succeeding Business Day;
provided, however, that if the Notes are LIBOR Notes and such Business
Day is in the next succeeding calendar month, such Interest Payment
Date shall be the immediately preceding Business Day. Unless otherwise
specified on the face hereof, if the Notes are designated on the face
hereof as Floating Rate Notes, if the Maturity Date of the Notes falls
on a day this is not a Business Day, the Trust will make the required
payment of principal, premium, if any, and interest or other amounts
6
on the next succeeding Business Day, and no additional interest will
accrue in respect of the payment made on that next succeeding Business
Day.
Unless otherwise specified on the face hereof and except as provided below,
interest will be payable as follows: (1) if the Interest Reset Date for the
Notes is daily, weekly or monthly, interest will be payable on the third
Wednesday of each month or on the third Wednesday of every third calendar month,
beginning in the third calendar month following the month in which the Notes
were issued, as specified on the face hereof; (2) if the Interest Reset Date for
the Notes is quarterly, interest will be payable on the third Wednesday of every
third calendar month, beginning in the third calendar month following the month
in which the Notes were issued; (3) if the Interest Reset Date for the Notes is
semiannually, interest will be payable on the third Wednesday of each of two
months of each year specified on the face hereof; (4) if the Interest Reset Date
for the Notes is annually, interest will be payable on the third Wednesday of
the month of each year specified on the face hereof. In each of these cases, the
Maturity Date will also be an Interest Payment Date.
If specified on the face hereof, the Notes may have either or both of a
Maximum Interest Rate or Minimum Interest Rate. If a Maximum Interest Rate is so
designated, the interest rate that may accrue during any Interest Period for
Floating Rate Notes cannot ever exceed such Maximum Interest Rate and in the
event that the interest rate on any Interest Reset Date would exceed such
Maximum Interest Rate (as if no Maximum Interest Rate were in effect) then the
interest rate on such Interest Reset Date shall be the Maximum Interest Rate. If
a Minimum Interest Rate is so designated, the interest rate that may accrue
during any Interest Period for Floating Rate Notes cannot ever be less than such
Minimum Interest Rate and in the event that the interest rate on any Interest
Reset Date would be less than such Minimum Interest Rate (as if no Minimum
Interest Rate were in effect) then the interest rate on such Interest Reset Date
shall be the Minimum Interest Rate. Notwithstanding anything to the contrary
contained herein, if the Notes are designated on the face hereof as Floating
Rate Notes, the interest rate on Notes shall not exceed the maximum interest
rate permitted by applicable law.
All determinations of interest by the Calculation Agent designated on
the face hereof will, in the absence of manifest error, be conclusive for all
purposes and binding on the Holder of the Notes and neither the Indenture
Trustee nor the Calculation Agent shall have any liability to the Holder of the
Notes in respect of any determination, calculation, quote or rate made or
provided by the Calculation Agent. Upon request of the Holder of the Notes, the
Calculation Agent will provide the interest rate then in effect and, if
determined, the interest rate that will become effective on the next Interest
Reset Date with respect to the Notes. If the Calculation Agent is incapable or
unwilling to act as such or if the Calculation Agent fails duly to establish the
interest rate for any interest accrual period or to calculate the interest
amount or any other requirements, the Trust will appoint a successor to act as
such in its place. The Calculation Agent may not resign its duties until a
successor has been appointed and such successor has accepted its appointment.
Subject to applicable provisions of law and except as specified herein, on
each Interest Reset Date, the rate of interest on the Notes on and after the
first Interest Reset Date shall be the interest rate determined in accordance
with the provisions of the heading below which has been designated as the
Interest Rate Basis on the face hereof (the "Interest Rate Basis"), the base
rate, plus or minus the Spread, if any, specified on the face hereof and/or
multiplied by the Spread Multiplier, if any, specified on the face hereof.
(A) CD Rate Notes. If the Interest Rate Basis is the CD Rate, the Notes
shall be deemed to be "CD Rate Notes." CD Rate Notes will bear
interest at the interest rate calculated with reference to the CD Rate
and the Spread or Spread Multiplier, if any. The Calculation Agent
will determine the CD Rate on each Interest Determination Date. The
Interest Determination Date is the second Business Day preceding the
related Interest Reset Date.
"CD Rate" means: (1) the rate on the particular Interest
Determination Date for negotiable United States dollar
certificates of deposit having the Index Maturity specified on
the face hereof as published in H.15(519) (as defined below)
under the caption "CDs (secondary market)"; or (2) if the rate
referred to in clause (1) is not so published by 3:00 P.M., New
York City time, on the related Calculation Date, the rate on the
particular Interest Determination Date for negotiable United
States dollar certificates of deposit of the particular Index
7
Maturity as published in the H.15 Daily Update (as defined below)
or other recognized electronic source used for the purpose of
displaying the applicable rate under the heading "CDs (secondary
market)"; or (3) if the rate referred to in clause (2) is not yet
published in either H.15(519) or the H.15 Daily Update by 3:00
P.M., New York City time, on the related Calculation Date, then
the CD Rate will be the rate on the particular Interest
Determination Date calculated by the Calculation Agent as the
arithmetic mean of the secondary market offered rates as of 10:00
A.M., New York City time on that Interest Determination Date of
three leading nonbank dealers in negotiable United States dollar
certificates of deposit in The City of New York (which may
include the Agents or their affiliates) selected by the
Calculation Agent for negotiable United States dollar
certificates of deposit of major United States money market banks
for negotiable United States certificates of deposit with a
remaining maturity closest to the particular Index Maturity in an
amount that is representative for a single transaction in that
market at that time; or (4) if the dealers so selected by the
Calculation Agent are not quoting as mentioned in clause (3), the
CD Rate in effect on the particular Interest Determination Date;
provided that if no CD Rate is then in effect, the interest rate
that will be effective as of the next Interest Reset Date will be
the Initial Interest Rate.
"H.15(519)" means the weekly statistical release designated as
H.15(519), or any successor publication, published by the Board
of Governors of the Federal Reserve System.
"H.15 Daily Update" means the daily update of H.15(519),
available through the world-wide-web site of the Board of
Governors of the Federal Reserve System at
http://www.federalreserve.gov/releases/H15/update, or any
successor site or publication.
(B) CMT Rate Notes. If the Interest Basis is the CMT Rate, the Notes shall
be deemed to be "CMT Rate Notes." CMT Rate Notes will bear interest at
the interest rate calculated with reference to the CMT Rate and the
Spread or Spread Multiplier, if any. The Calculation Agent will
determine the CMT Rate on each applicable Interest Determination Date.
The applicable Interest Determination Date is the second Business Day
preceding the Interest Reset Date.
"CMT Rate" means: (1) if CMT Moneyline Telerate Page 7051 is
specified on the face hereof: (a) the percentage equal to the
yield for United States Treasury securities at "constant
maturity" having the Index Maturity specified on the face hereof
as published in H.15(519) under the caption "Treasury Constant
Maturities", as the yield is displayed on Moneyline Telerate (or
any successor service) on page 7051 (or any other page as may
replace the specified page on that service) ("Moneyline Telerate
Page 7051"), for the particular Interest Determination Date; or
(b) if the rate referred to in clause (a) does not so appear on
Moneyline Telerate Page 7051, the percentage equal to the yield
for United States Treasury securities at "constant maturity"
having the particular Index Maturity and for the particular
Interest Determination Date as published in H.15(519) under the
caption "Treasury Constant Maturities"; or (c) if the rate
referred to in clause (b) does not so appear in H.15(519), the
rate on the particular Interest Determination Date for the period
of the particular Index Maturity as may then be published by
either the Federal Reserve System Board of Governors or the
United States Department of the Treasury that the Calculation
Agent determines to be comparable to the rate which would
otherwise have been published in H.15(519); or (d) if the rate
referred to in clause (c) is not so published, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent as a yield to maturity based on the arithmetic
mean of the secondary market bid prices at approximately 3:30
P.M., New York City time, on that Interest Determination Date of
three leading primary United States government securities dealers
in The City of New York (which may include the Agents or their
affiliates) (each, a "Reference Dealer"), selected by the
Calculation Agent from five Reference Dealers selected by the
Calculation Agent and eliminating the highest quotation, or, in
the event of equality, one of the highest, and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity equal
to the particular Index Maturity, a remaining term to maturity no
8
more than one year shorter than that Index Maturity and in a
principal amount that is representative for a single transaction
in the securities in that market at that time; or (e) if fewer
than five but more than two of the prices referred to in clause
(d) are provided as requested, the rate on the particular
Interest Determination Date calculated by the Calculation Agent
based on the arithmetic mean of the bid prices obtained and
neither the highest nor the lowest of the quotations shall be
eliminated; or (f) if fewer than three prices referred to in
clause (d) are provided as requested, the rate on the particular
Interest Determination Date calculated by the Calculation Agent
as a yield to maturity based on the arithmetic mean of the
secondary market bid prices as of approximately 3:30 P.M., New
York City time, on that Interest Determination Date of three
Reference Dealers selected by the Calculation Agent from five
Reference Dealers selected by the Calculation Agent and
eliminating the highest quotation or, in the event of equality,
one of the highest and the lowest quotation or, in the event of
equality, one of the lowest, for United States Treasury
securities with an original maturity greater than the particular
Index Maturity, a remaining term to maturity closest to that
Index Maturity and in a principal amount that is representative
for a single transaction in the securities in that market at that
time; or (g) if fewer than five but more than two prices referred
to in clause (f) are provided as requested, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent based on the arithmetic mean of the bid prices
obtained and neither the highest nor the lowest of the quotations
will be eliminated; or (h) if fewer than three prices referred to
in clause (f) are provided as requested, the CMT Rate in effect
on the particular Interest Determination Date; provided that if
no CMT Rate is then in effect, the interest rate that will be
effective as of the next Interest Reset Date will be the Initial
Interest Rate; or (2) if CMT Moneyline Telerate Page 7052 is
specified on the face hereof: (a) the percentage equal to the
one-week or one-month, as specified on the face hereof, average
yield for United States Treasury securities at "constant
maturity" having the Index Maturity specified on the face hereof
as published in H.15(519) opposite the caption "Treasury Constant
Maturities", as the yield is displayed on Moneyline Telerate (or
any successor service) (on page 7052 or any other page as may
replace the specified page on that service) ("Moneyline Telerate
Page 7052"), for the week or month, as applicable, ended
immediately preceding the week or month, as applicable, in which
the particular Interest Determination Date falls; or (b) if the
rate referred to in clause (a) does not so appear on Moneyline
Telerate Page 7052, the percentage equal to the one-week or
one-month, as specified on the face hereof, average yield for
United States Treasury securities at "constant maturity" having
the particular Index Maturity and for the week or month, as
applicable, preceding the particular Interest Determination Date
as published in H.15(519) opposite the caption "Treasury Constant
Maturities"; or (c) if the rate referred to in clause (b) does
not so appear in H.15(519), the one-week or one-month, as
specified on the face hereof, average yield for United States
Treasury securities at "constant maturity" having the particular
Index Maturity as otherwise announced by the Federal Reserve Bank
of New York for the week or month, as applicable, ended
immediately preceding the week or month, as applicable, in which
the particular Interest Determination Date falls; or (d) if the
rate referred to in clause (c) is not so published, the rate on
the particular Interest Determination Date calculated by the
Calculation Agent as a yield to maturity based on the arithmetic
mean of the secondary market bid prices at approximately 3:30
P.M., New York City time, on that Interest Determination Date of
three Reference Dealers selected by the Calculation Agent from
five Reference Dealers selected by the Calculation Agent and
eliminating the highest quotation, or, in the event of equality,
one of the highest, and the lowest quotation or, in the event of
equality, one of the lowest, for United States Treasury
securities with an original maturity equal to the particular
Index Maturity, a remaining term to maturity no more than one
year shorter than that Index Maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at that time; or (e) if fewer than five but more
than two of the prices referred to in clause (d) are provided as
requested, the rate on the particular Interest Determination Date
calculated by the Calculation Agent based on the arithmetic mean
of the bid prices obtained and neither the highest nor the lowest
of the quotations shall be eliminated; or (f) if fewer than three
prices referred to in clause (d) are
9
provided as requested, the rate on the particular Interest
Determination Date calculated by the Calculation Agent as a yield
to maturity based on the arithmetic mean of the secondary market
bid prices as of approximately 3:30 P.M., New York City time, on
that Interest Determination Date of three Reference Dealers
selected by the Calculation Agent from five Reference Dealers
selected by the Calculation Agent and eliminating the highest
quotation or, in the event of equality, one of the highest and
the lowest quotation or, in the event of equality, one of the
lowest, for United States Treasury securities with an original
maturity greater than the particular Index Maturity, a remaining
term to maturity closest to that Index Maturity and in a
principal amount that is representative for a single transaction
in the securities in that market at the time; or (g) if fewer
than five but more than two prices referred to in clause (f) are
provided as requested, the rate on the particular Interest
Determination Date calculated by the Calculation Agent based on
the arithmetic mean of the bid prices obtained and neither the
highest nor the lowest of the quotations will be eliminated; or
(h) if fewer than three prices referred to in clause (f) are
provided as requested, the CMT Rate in effect on that Interest
Determination Date; provided that if no CMT Rate is then in
effect, the interest rate that will be effective as of the next
Interest Reset Date will be the Initial Interest Rate.
If two United States Treasury securities with an original
maturity greater than the Index Maturity specified on the face
hereof have remaining terms to maturity equally close to the
particular Index Maturity, the quotes for the United States
Treasury security with the shorter original remaining term to
maturity will be used.
(C) Commercial Paper Rate Notes. If the Interest Rate Basis is the
Commercial Paper Rate, the Notes shall be deemed to be "Commercial
Paper Rate Notes." Commercial Paper Rate Notes will bear interest for
each Interest Reset Date at the interest rate calculated with
reference to the Commercial Paper Rate and the Spread or Spread
Multiplier, if any. The Calculation Agent will determine the
Commercial Paper Rate on each applicable Interest Determination Date.
The Interest Determination Date is the second Business Day preceding
the related Interest Reset Date.
"Commercial Paper Rate" means: (1) the Money Market Yield
(calculated as described below) on the Interest Determination
Date of the rate for commercial paper having the applicable Index
Maturity as such rate is published in H.15(519) under the heading
"Commercial Paper--Nonfinancial"; or (2) if the rate referred to
in clause (1) is not published by 3:00 P.M., New York City time,
on the Calculation Date pertaining to such Interest Determination
Date, then the Commercial Paper Rate shall be the Money Market
Yield on the particular Interest Determination Date of the rate
for commercial paper having the particular Index Maturity as
published on H.15 Daily Update or such other recognized
electronic source used for the purposes of displaying the
applicable rate, under the caption "Commercial
Paper--Nonfinancial"; or (3) if the rate referred to in clause
(2) is not published by 3:00 P.M., New York City time, on the
Calculation Date, then the Commercial Paper Rate as calculated by
the Calculation Agent shall be the Money Market Yield of the
arithmetic mean of the offered rates at approximately 11:00 A.M.,
New York City time, on that Interest Determination Date of three
leading dealers of United States dollar commercial paper in The
City of New York (which may include the Agents or their
affiliates) selected by the Calculation Agent for commercial
paper having the particular Index Maturity placed for industrial
issuers whose bond rating is "Aa" by Moody's or the equivalent
from another nationally recognized statistical rating
organization; or (4) if the dealers so selected by the
Calculation Agent are not quoting as mentioned in clause (3), the
Commercial Paper Rate in effect on the particular Interest
Determination Date; provided that if no Commercial Paper Rate is
then in effect, the interest rate that will be effective as of
the next Interest Reset Date will be the Initial Interest Rate.
"Money Market Yield" shall be a yield (expressed as a percentage)
calculated in accordance with the following formula:
10
Money Market Yield = D x 360 x 100
-----------------------
360 - (D x M)
where "D" refers to the per annum rate for the commercial paper,
quoted on a bank discount basis and expressed as a decimal; and
"M" refers to the actual number of days in the applicable
Interest Period.
(D) Constant Maturity Swap Rate Notes. If the Interest Basis is the
Constant Maturity Swap Rate, the Notes shall be deemed to be "Constant
Maturity Swap Rate Notes." Constant Maturity Swap Rate Notes will bear
interest at the interest rate calculated with reference to the
Constant Maturity Swap Rate and the Spread or Spread Multiplier, if
any. The Calculation Agent will determine the Constant Maturity Swap
Rate on each applicable Interest Determination Date. The Interest
Determination Date is the second U.S. Government Securities Business
Day (as defined below) preceding the related Interest Reset Date;
provided, however, that if, after attempting to determine the Constant
Maturity Swap Rate (as described below), such rate is not determinable
for a particular Interest Determination Date (the "Original Interest
Determination Date"), then such Interest Determination Date shall be
the first U.S. Government Securities Business Day preceding the
Original Interest Determination Date for which the Constant Maturity
Swap Rate can be determined as described below.
Constant Maturity Swap Rate" means: (1) the rate for U.S. Dollar
swaps with the designated maturity specified on the face hereof,
expressed as a percentage, which appears on the Reuters Screen
ISDAFIX1 Page as of 11:00 A.M., New York City time, on the
particular Interest Determination Date; or (2) if the rate
referred to in clause (1) does not appear on the Reuters Screen
ISDAFIX1 Page by 2:00 P.M., New York City time, on such Interest
Determination Date, a percentage determined on the basis of the
mid-market semi-annual swap rate quotations provided by the
Reference Banks (as defined below) as of approximately 11:00
A.M., New York City time, on such Interest Determination Date,
and, for this purpose, the semi-annual swap rate means the mean
of the bid and offered rates for the semi-annual fixed leg,
calculated on a 30/360 day count basis, of a fixed-for-floating
U.S. Dollar interest rate swap transaction with a term equal to
the designated maturity specified in the face hereof commencing
on the Interest Reset Date and in a Representative Amount (as
defined below) with an acknowledged dealer of good credit in the
swap market, where the floating leg, calculated on an Actual/360
day count basis, is equivalent to USD-LIBOR-BBA with a designated
maturity specified on the face hereof. The Calculation Agent will
request the principal New York City office of each of the
Reference Banks to provide a quotation of its rate. If at least
three quotations are provided, the rate for that Interest
Determination Date will be the arithmetic mean of the quotations,
eliminating the highest quotation (or, in the event of equality,
one of the highest) and the lowest quotation (or, in the event of
equality, one of the lowest).
"U.S. Government Securities Business Day" means any day except
for Saturday, Sunday, or a day on which The Bond Market
Association recommends that the fixed income departments of its
members be closed for the entire day for purposes of trading in
U.S. government securities.
"Representative Amount" means an amount that is representative
for a single transaction in the relevant market at the relevant
time.
"Reference Banks" mean five leading swap dealers in the New York
City interbank market, selected by the Calculation Agent, after
consultation with Allstate Life Insurance Company ("Allstate
Life").
11
(E) Federal Funds Open Rate Notes. If the Interest Basis is the Federal
Funds Open Rate, the Notes shall be deemed to be "Federal Funds Open
Rate Notes." Federal Funds Open Rate Notes will bear interest at the
interest rate calculated with reference to the Federal Funds Open Rate
and the Spread or Spread Multiplier, if any. The Calculation Agent
will determine the Federal Funds Open Rate on each applicable Interest
Determination Date. The Interest Determination Date is the related
Interest Reset Date.
"Federal Funds Open Rate" means the rate set forth on Moneyline
Telerate Page 5 for an Interest Reset Date underneath the caption
"FEDERAL FUNDS" in the row titled "OPEN". If the rate is not
available for an Interest Reset Date, the rate for that Interest
Reset Date shall be the Federal Funds Rate as determined below.
(F) Federal Funds Rate Notes. If the Interest Rate Basis is the Federal
Funds Rate, the Notes shall be deemed to be "Federal Funds Rate
Notes." Federal Funds Rate Notes will bear interest for each Interest
Reset Date at the interest rate calculated with reference to the
Federal Funds Rate and the Spread or Spread Multiplier, if any. The
Calculation Agent will determine the Federal Funds Rate on each
applicable Interest Determination Date. The Interest Determination
Date is the Business Day immediately preceding the related Interest
Reset Date.
"Federal Funds Rate" means: (1) the rate on the particular
Interest Determination Date for United States dollar federal
funds as published in H.15(519) under the caption "Federal Funds
(Effective)" and displayed on Moneyline Telerate (or any
successor service) on page 120 (or any other page as may replace
the specified page on that service) ("Moneyline Telerate Page
120"); or (2) if the rate referred to in clause (1) does not so
appear on Moneyline Telerate Page 120 or is not so published by
3:00 P.M., New York City time, on the related Calculation Date,
the rate on the particular Interest Determination Date for United
States dollar federal funds as published in H.15 Daily Update, or
such other recognized electronic source used for the purpose of
displaying the applicable rate, under the caption "Federal Funds
(Effective)"; or (3) if the rate referred to in clause (2) is not
so published by 3:00 P.M., New York City time, on the related
Calculation Date, the rate on the particular Interest
Determination Date calculated by the Calculation Agent as the
arithmetic mean of the rates for the last transaction in
overnight United States dollar federal funds arranged by three
leading brokers of United States dollar federal funds
transactions in The City of New York (which may include the
Agents or their affiliates), selected by the Calculation Agent
prior to 9:00 A.M., New York City time, on the business day
following that Interest Determination Date; or (4) if the brokers
so selected by the Calculation Agent are not quoting as mentioned
in clause (3), the Federal Funds Rate in effect on the particular
Interest Determination Date; provided that if no Federal Funds
Rate is then in effect, the interest rate that will be effective
as of the next Interest Reset Date will be the Initial Interest
Rate.
(G) LIBOR Notes. If the Interest Rate Basis is LIBOR (as defined below),
the Notes shall be deemed to be "LIBOR Notes." LIBOR Notes will bear
interest for each Interest Period at the interest rate calculated with
reference to LIBOR and the Spread or Spread Multiplier, if any. On
each applicable Interest Determination Date the Calculation Agent will
determine LIBOR. The applicable Interest Determination Date is the
second London Banking Day (as defined below) preceding the related
Interest Reset Date.
LIBOR means: (1) if "LIBOR Moneyline Telerate" is specified on
the face hereof or if neither "LIBOR Reuters" nor "LIBOR
Moneyline Telerate" is specified on the face hereof as the method
for calculating LIBOR, the rate for deposits in the LIBOR
Currency (as defined below) having the Index Maturity specified
on the face hereof, commencing on the related Interest Reset
Date, that appears on the LIBOR Page (as defined below) as of
11:00 A.M., London time, on the particular Interest Determination
Date; or (2) if "LIBOR Reuters" is specified on the face hereof,
12
the arithmetic mean of the offered rates, calculated by the
Calculation Agent, or the offered rate, if the LIBOR Page by its
terms provides only for a single rate, for deposits in the LIBOR
Currency having the particular Index Maturity, commencing on the
related Interest Reset Date, that appear or appears, as the case
may be, on the LIBOR Page as of 11:00 A.M., London time, on the
particular Interest Determination Date; or (3) if fewer than two
offered rates appear, or no rate appears, as the case may be, on
the particular Interest Determination Date on the LIBOR Page as
specified in clause (1) or (2), as applicable, the rate
calculated by the Calculation Agent of at least two offered
quotations obtained by the Calculation Agent after requesting the
principal London offices of each of four major reference banks
(which may include affiliates of the Agents), in the London
interbank market to provide the Calculation Agent with its
offered quotation for deposits in the LIBOR Currency for the
period of the particular Index Maturity, commencing on the
related Interest Reset Date, to prime banks in the London
interbank market at approximately 11:00 A.M., London time, on
that Interest Determination Date and in a principal amount that
is representative for a single transaction in the LIBOR Currency
in that market at that time; or (4) if fewer than two offered
quotations referred to in clause (3) are provided as requested,
the rate calculated by the Calculation Agent as the arithmetic
mean of the rates quoted at approximately 11:00 A.M., in the
applicable Principal Financial Center, on the particular Interest
Determination Date by three major banks (which may include
affiliates of the Agents), in that Principal Financial Center
selected by the Calculation Agent for loans in the LIBOR Currency
to leading European banks, having the particular Index Maturity
and in a principal amount that is representative for a single
transaction in the LIBOR Currency in that market at that time; or
(5) if the banks so selected by the Calculation Agent are not
quoting as mentioned in clause (4), LIBOR in effect on the
particular Interest Determination Date; provided that if no LIBOR
is then in effect, the interest rate that will be effective as of
the next Interest Reset Date will be the Initial Interest Rate.
"LIBOR Currency" means United States dollars.
"LIBOR Page" means either: (1) if "LIBOR Reuters" is specified on
the face hereof, the display on the Reuter Monitor Money Rates
Service (or any successor service) on the page specified on the
face hereof (or any other page as may replace that page on that
service) for the purpose of displaying the London interbank rates
of major banks for the LIBOR Currency; or (2) if "LIBOR Moneyline
Telerate" is specified on the face hereof or neither "LIBOR
Reuters" nor "LIBOR Moneyline Telerate" is specified on the face
hereof as the method for calculating LIBOR, the display on
Moneyline Telerate (or any successor service) on the page
specified on the face hereof (or any other page as may replace
such page on such service) for the purpose of displaying the
London interbank rates of major banks for the LIBOR Currency.
"London Banking Day" means a day on which commercial banks are
open for business (including dealing in the LIBOR Currency) in
London.
(H) Prime Rate Notes. If the Interest Rate Basis is the Prime Rate, the
Notes shall be deemed to be "Prime Rate Notes." Prime Rate Notes will
bear interest for each Interest Reset Date calculated with reference
to the Prime Rate and the Spread or Spread Multiplier, if any, subject
to the Minimum Interest Rate and/or Maximum Interest Rate, if any,
specified on the face hereof. The Calculation Agent will determine the
Prime Rate for each Interest Reset Date on each applicable Interest
Determination Date. The Interest Determination Date is the Business
Day immediately preceding the related Interest Reset Date.
"Prime Rate" means: (1) the rate on the particular Interest
Determination Date as published in H.15(519) under the caption
"Bank Prime Loan"; or (2) if the rate referred to in clause (1)
is not so published by 3:00 P.M., New York City time, on the
related Calculation Date, the rate on the particular Interest
Determination Date as published in H.15 Daily Update, or such
13
other recognized electronic source used for the purpose of
displaying the applicable rate, under the caption "Bank Prime
Loan"; or (3) if the rate referred to in clause (2) is not so
published by 3:00 P.M., New York City time, on the related
Calculation Date, the rate on the particular Interest
Determination Date calculated by the Calculation Agent as the
arithmetic mean of the rates of interest publicly announced by
each bank that appears on the Reuters Screen US PRIME 1 Page (as
defined below) as the applicable bank's prime rate or base
lending rate as of 11:00 A.M., New York City time, on that
Interest Determination Date; or (4) if fewer than four rates
referred to in clause (3) are so published by 3:00 P.M., New York
City time, on the related Calculation Date, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent as the arithmetic mean of the prime rates or
base lending rates quoted on the basis of the actual number of
days in the year divided by a 360-day year as of the close of
business on that Interest Determination Date by three major banks
(which may include affiliates of the Agents) in The City of New
York selected by the Calculation Agent; or (5) if the banks so
selected by the Calculation Agent are not quoting as mentioned in
clause (4), the Prime Rate in effect on the particular Interest
Determination Date; provided that if no Prime Rate is then in
effect, the interest rate that will be effective as of the next
Interest Reset Date will be the Initial Interest Rate.
"Reuters Screen US PRIME 1 Page" means the display on the Reuter
Monitor Money Rates Service (or any successor service) on the "US
PRIME 1" page (or any other page as may replace that page on that
service) for the purpose of displaying prime rates or base
lending rates of major United States banks.
(I) Treasury Rate Notes. If the Interest Rate Basis is the Treasury Rate,
the Notes shall be deemed to be "Treasury Rate Notes." Treasury Rate
Notes will bear interest for each Interest Reset Date at the interest
rate calculated with reference to the Treasury Rate and the Spread or
Spread Multiplier, if any. The Calculation Agent will determine the
Treasury Rate on each Treasury Rate Determination Date (as defined
below).
"Treasury Rate" means: (1) the rate from the auction held on the
Treasury Rate Interest Determination Date (the "Auction") of
direct obligations of the United States ("Treasury Bills") having
the Index Maturity specified on the face hereof under the caption
"INVESTMENT RATE" on the display on Moneyline Telerate (or any
successor service) on page 56 (or any other page as may replace
that page on that service) ("Moneyline Telerate Page 56") or page
57 (or any other page as may replace that page on that service)
("Moneyline Telerate Page 57"); or (2) if the rate referred to in
clause (1) is not so published by 3:00 P.M., New York City time,
on the related Calculation Date, the Bond Equivalent Yield (as
defined below) of the rate for the applicable Treasury Bills as
published in H.15 Daily Update, or another recognized electronic
source used for the purpose of displaying the applicable rate,
under the caption "U.S. Government Securities/Treasury
Bills/Auction High"; or (3) if the rate referred to in clause (2)
is not so published by 3:00 P.M., New York City time, on the
related Calculation Date, the Bond Equivalent Yield of the
auction rate of the applicable Treasury Bills as announced by the
United States Department of the Treasury; or (4) if the rate
referred to in clause (3) is not so announced by the United
States Department of the Treasury, or if the Auction is not held,
the Bond Equivalent Yield of the rate on the particular Interest
Determination Date of the applicable Treasury Bills as published
in H.15(519) under the caption "U.S. Government
Securities/Treasury Bills/Secondary Market"; or (5) if the rate
referred to in clause (4) is not so published by 3:00 P.M., New
York City time, on the related Calculation Date, the rate on the
particular Interest Determination Date of the applicable Treasury
Bills as published in H.15 Daily Update, or another recognized
electronic source used for the purpose of displaying the
applicable rate, under the caption "U.S. Government
Securities/Treasury Bills/Secondary Market"; or (6) if the rate
referred to in clause (5) is not so published by 3:00 P.M., New
York City time, on the related Calculation Date, the rate on the
particular Interest Determination Date calculated by the
Calculation Agent as the Bond Equivalent Yield of the arithmetic
mean of the secondary market bid rates, as of approximately
14
3:30 P.M., New York City time, on that Interest Determination
Date, of three primary United States government securities
dealers (which may include the Agents or their affiliates)
selected by the Calculation Agent, for the issue of Treasury
Bills with a remaining maturity closest to the Index Maturity
specified on the face hereof; or (7) if the dealers so selected
by the Calculation Agent are not quoting as mentioned in clause
(6), the Treasury Rate in effect on the particular Interest
Determination Date; provided that if no Treasury Rate is then in
effect, the interest rate that will be effective as of the next
Interest Reset Date will be the Initial Interest Rate.
"Bond Equivalent Yield" means a yield (expressed as a percentage)
calculated in accordance with the following formula:
Bond Equivalent Yield = D x N x 100
-------------------
360 - (D x M)
where "D" refers to the applicable per annum rate for Treasury
Bills quoted on a bank discount basis and expressed as a decimal,
"N" refers to 365 or 366, as the case may be, and "M" refers to
the actual number of days in the applicable Interest Period.
The "Treasury Rate Determination Date" for each Interest Reset
Date means the day in the week in which the related Interest
Reset Date falls on which day Treasury Bills are normally
auctioned (i.e., Treasury Bills are normally sold at auction on
Monday of each week, unless that day is a legal holiday, in which
case the auction is normally held on the following Tuesday,
except that the auction may be held on the preceding Friday);
provided, however, that if an auction is held on the Friday of
the week preceding the related Interest Reset Date, the Interest
Determination Date will be the preceding Friday.
(J) Regular Floating Rate Notes. Unless the Notes are designated as
Floating Rate/Fixed Rate Notes or as having an Addendum attached or
having other/additional provisions apply, in each case relating to a
different interest rate formula, such Notes that bear interest at
floating rates will be Regular Floating Rate Notes and will bear
interest at the rate determined by reference to the applicable
Interest Rate Basis or Bases plus or minus the applicable Spread, if
any, and/or multiplied by the applicable Spread Multiplier, if any.
Commencing on the first Interest Reset Date, as specified on the face
hereof, the rate at which interest on Regular Floating Rate Notes is
payable will be reset as of each Interest Reset Date; provided,
however, that the interest rate in effect for the period, if any, from
the date of issue to the first Interest Reset Date will be the Initial
Interest Rate.
(K) Floating Rate/Fixed Rate Notes. If the Notes are designated as
"Floating Rate/Fixed Rate Notes" on the face hereof, such Notes that
bear interest at floating rates will bear interest at the rate
determined by reference to the applicable Interest Rate Basis or Bases
plus or minus the applicable Spread, if any, and/or multiplied by the
applicable Spread Multiplier, if any. Commencing on the first Interest
Reset Date, the rate at which interest on Floating Rate/Fixed Rate
Notes is payable will be reset as of each Interest Reset Date;
provided, however, that the interest rate in effect for the period, if
any, from the date of issue to the first Interest Reset Date will be
the Initial Interest Rate, as specified on the face hereof; and the
interest rate in effect commencing on the Fixed Rate Commencement Date
will be the Fixed Interest Rate, if specified on the face hereof, or,
if not so specified, the interest rate in effect on the day
immediately preceding the Fixed Rate Commencement Date.
SECTION 4. Optional Redemption. Except in the case of Discount Notes, if an
Initial Redemption Date is specified on the face hereof, the Trust may redeem
the Notes prior to the Stated Maturity Date at its option on any Business Day on
or after the Initial Redemption Date in whole or from time to time in part in
increments of $1,000 or any other integral multiple of an authorized
denomination specified on the face hereof (provided that any remaining principal
15
amount of the Notes shall be at least $1,000 or other minimum authorized
denomination applicable thereto), at the applicable Redemption Price (as defined
below), together with unpaid interest accrued on the Notes, any Additional
Amounts and other amounts payable with respect thereto to the date of
redemption. The Trust must give written notice to the Holders of the Notes to be
redeemed at its option not more than 60 nor less than 30 calendar days prior to
the date of redemption. "Redemption Price" means an amount equal to the Initial
Redemption Percentage specified on the face hereof (as adjusted by the Annual
Redemption Percentage Reduction, if applicable) multiplied by the unpaid
principal amount of Notes represented by this Note Certificate to be redeemed.
The Initial Redemption Percentage, if any, shall decline at each anniversary of
the Initial Redemption Date by an amount equal to the applicable Annual
Redemption Percentage Reduction, if any, until the Redemption Price is equal to
100% of the unpaid amount thereof to be redeemed.
SECTION 5. Repayment Provisions. If the face of this Note Certificate
specifies that "Survivor's Option" (as defined below) applies, the person (the
"Authorized Representative") who has legal authority to act on behalf of the
estate of the deceased owner of a beneficial interest in the Notes represented
hereby shall have the option to elect repayment of the Notes in whole or in part
in increments of U.S.$1,000 (provided that any remaining principal amount of the
Notes shall be at least U.S.$1,000), following the death of such beneficial
owner (a "Survivor's Option"). No Survivor's Option may be exercised unless such
beneficial interest was held by the beneficial owner for a period of at least
six months prior to the death of the beneficial owner.
Pursuant to the valid exercise of the Survivor's Option, if applicable, the
Trust shall repay the Notes represented hereby (or portion thereof) at a price
equal to 100% of the unpaid principal amount of the Notes to be repaid, together
with unpaid interest accrued thereon to, but excluding, the Repayment Date,
subject to the limitations in the next succeeding sentence. Allstate Life may,
in its sole discretion, limit the aggregate principal amount of (i) all Funding
Agreements securing all outstanding series of notes issued under the Allstate
Life(R) CoreNotes(R) program as to which exercises of any put option by any
issuing trust shall be accepted by Allstate Life in any calendar year to an
amount equal to the greater of $2,000,000 or 2% of the aggregate principal
amount of all Funding Agreements securing all outstanding series of notes issued
under the Allstate LIFE(R) CoreNotes(R) program as of the end of the most recent
calendar year or such other greater amount as determined in accordance with the
applicable Funding Agreement(s) and set forth on the face hereof; (ii) the
Funding Agreement(s) securing the Notes as to which exercises of any put option
by the Trust attributable to Notes as to which the Survivor's Option has been
exercised by the Authorized Representative of any individual deceased beneficial
owner to $250,000 in any calendar year or such other greater amount as
determined in accordance with the applicable Funding Agreement(s) and set forth
on the face hereof; and (iii) the Funding Agreement(s) securing the Notes as to
which exercises of any put option by the Trust shall be accepted in any calendar
year to an amount as set forth in the applicable Funding Agreement(s) and on the
face hereof.
In any such event, the Trust shall similarly be required to limit the
aggregate principal amount of Notes as to which exercises of the Survivor's
Option shall be accepted by it.
Each election to exercise the Survivor's Option shall be effected in the
order received by the Administrator. Notes that are not repaid in any calendar
year due to the application of the limits described above will be treated as
though they had been tendered on the first day of the following calendar year in
the order in which they were originally tendered. Subject to the limitations
described above, Notes accepted for repayment will be repaid on the first
interest payment date that occurs 20 or more calendar days after the date of the
acceptance unless that interest payment date is not a Business Day, in which
case the repayment date will be the next succeeding Business Day.
To exercise the Survivor's Option, the Authorized Representative must
provide to the Indenture Trustee a properly completed Repayment Election Form,
which is attached hereto as Annex A.
Subject to Allstate Life's right hereunder to limit the aggregate principal
amount of Funding Agreements securing notes as to which exercises of any put
option by the issuing trusts attributable to notes as to which exercises of the
Survivor's Option shall be accepted in any one calendar year, all questions as
to the eligibility or validity of any exercise of the Survivor's Option will be
determined by the Administrator, in its sole discretion. The Administrator's
determination shall be final and binding.
The death of a person owning a Note or beneficial interest therein in joint
tenancy or tenancy by the entirety with another person or persons shall be
deemed to be the death of the Holder or beneficial owner, as the case may be, of
such Note, and the entire principal amount of such Note or beneficial interest
16
therein shall be eligible for repayment pursuant to the Survivor's Option. The
death of a person owning a Note or beneficial interest therein by tenancy in
common shall be deemed to be the death of the Holder or beneficial owner, as the
case may be, of such Note only to the extent of the interest of the deceased
Holder or beneficial owner in such Note unless such Note or beneficial interest
therein is held by husband and wife as tenants in common, in which case, the
death of either spouse shall be deemed to be the death of the Holder or
beneficial owner, as the case may be, of such Note, and the entire principal
amount of such Note or beneficial interest therein shall be eligible for
repayment pursuant to the Survivor's Option.
The death of a person who, during his or her lifetime, was entitled to
substantially all of the interests of beneficial ownership of a Note shall be
deemed to be the death of the Holder or beneficial owner, as the case may be, of
such Note if such interests can be established to the satisfaction of the
Administrator.
In the event of repayment of the Notes in part only, a new Note Certificate
of like tenor in a principal amount equal to the unrepaid portion of principal
of Notes represented by this Note Certificate and otherwise having the same
terms and provisions as the Notes shall be issued by the Trust in the name of
the Holder of this Note Certificate upon the presentation and surrender of this
Note Certificate.
SECTION 6. Sinking Fund. Unless otherwise specified on the face hereof, the
Notes will not be subject to any sinking fund.
SECTION 7. Modifications and Amendments. Sections 9.1 and 9.2 of the
Standard Indenture Terms contain provisions permitting the Trust and the
Indenture Trustee (1) without the consent of any Holder, to execute Supplemental
Indentures for limited purposes and take other actions set forth in the Standard
Indenture Terms, and (2) with the consent of the Holders of not less than
66(2)/3% in aggregate principal amount of Notes at the time outstanding,
evidenced as in the Standard Indenture Terms, to execute Supplemental Indentures
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Indenture or any Supplemental Indenture or modifying in any
manner the rights of the Holders of the Notes subject to specified limitations.
SECTION 8. Obligations Unconditional. No reference herein to the Indenture
or the Standard Indenture Terms and no provision of the Notes or of the
Indenture shall alter or impair the obligation of the Trust, which is absolute
and unconditional, to pay the principal of, interest on, or any other amount due
and owing with respect to, the Notes at the places, at the respective times, and
at the rate herein prescribed.
SECTION 9. Collateral. Pursuant to the Indenture, the Trust will grant a
security interest in, pledge and collaterally assign the Collateral specified on
the face hereof to the Indenture Trustee on behalf of the holders of the Notes
and any other person for whose benefit the Indenture Trustee is or will be
holding the Collateral. The Notes will be secured by a first priority perfected
security interest in the Collateral in favor of the Indenture Trustee and the
other persons identified in the Standard Indenture Terms.
SECTION 10. Security; Limited Recourse. The Notes are solely the
obligations of the Trust, and will not be guaranteed by any person, including
but not limited to Allstate Life, Allstate Life Global Funding, any Agent, the
Trust Beneficial Owner, the Delaware Trustee, the Indenture Trustee or any of
their affiliates. The Trust's obligations under the Notes will be secured by all
of the Trust's rights and title in one or more Funding Agreement(s) issued by
Allstate Life and other rights and assets included in the applicable Collateral.
The Holder of the Notes has no direct contractual rights against Allstate Life
under the Funding Agreement(s). Under the terms of each Funding Agreement,
recourse rights to Allstate Life will belong to the Trust, its successors and
permitted assignees. The Trust has pledged, collaterally assigned and granted a
first priority perfected security interest in the Collateral for the Notes to
the Indenture Trustee on behalf of the Holders of the Notes and the other
persons identified in the Standard Indenture Terms. Recourse to Allstate Life
under each Funding Agreement will be enforceable only by the Indenture Trustee
as a secured party on behalf of the Holders of Notes and the other persons
identified in the Standard Indenture Terms.
SECTION 11. Events of Default. In case an Event of Default, as defined in
the Standard Indenture Terms, shall have occurred and be continuing, the
principal of the Notes may be declared, and upon such declaration shall become,
due and payable in the manner, with the effect and subject to the conditions
provided in the Standard Indenture Terms. If the Notes are Discount Notes, the
amount of principal of the Notes that becomes due and payable upon such
acceleration shall be equal to the amount calculated as set forth in Section 3
hereof.
17
SECTION 12. Withholding; Additional Amounts; Tax Event. All amounts due in
respect of the Notes will be made without withholding or deduction for or on
account of any present or future taxes, duties, levies, assessments or other
governmental charges of whatever nature imposed or levied by or on behalf of any
governmental authority in the United States having the power to tax on payments
on the Notes unless the withholding or deduction is required by law. Unless
otherwise specified on the face hereof, the Trust will not pay any additional
amounts ("Additional Amounts") to Holders of the Notes in the event that any
withholding or deduction is so required by law, regulation or official
interpretation thereof, and the imposition of a requirement to make any such
withholding or deduction will not give rise to any independent right or
obligation to redeem the Notes.
SECTION 13. Listing. Unless otherwise specified on the face hereof, the
Notes will not be listed on any securities exchange.
SECTION 14. No Recourse Against Certain Persons. No recourse shall be had
for the payment of the principal of or the interest on the Notes, or for any
claim based hereon, or otherwise in respect thereof, or based on or in respect
of the Indenture or any Supplemental Indenture, against the Nonrecourse Parties,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such personal
liability being, by the acceptance of any Notes and as part of the consideration
for issue of the Notes, expressly waived and released.
SECTION 15. Governing Law. Pursuant to Section 5-1401 of the General
Obligations Law of the State of New York, the Notes shall be governed by, and
construed in accordance with, the laws of the State of New York.
18
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this Note Certificate, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM UNIF GIFT MIN ACT
-- as tenants in common ------- -----
(Cust) Custodian (Minor)
TEN ENT -- as tenants by the entireties
JT TEN as joint tenants with right of under Uniform Gifts to Minors Act
survivorship and not as tenants in
-- common
CUST -- custodian
----------------------
(State)
Additional abbreviations may also be used though not in the above list.
19
ASSIGNMENT FORM
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
- -------------------------------------------------------------------------------
Please Insert Social Security or Other Identifying Number of Assignee
- -------------------------------------------------------------------------------
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
the within Security of THE ALLSTATE LIFE GLOBAL FUNDING TRUST SPECIFIED ON THE
FACE OF THIS NOTE CERTIFICATE and does hereby irrevocably constitute and appoint
________________ attorney to transfer said Security on the books of the Issuer,
with full power of substitution in the premises.
Dated:
------------------------- --------------------------------
--------------------------------
NOTICE: The signature to this assignment must correspond with the name as
written upon the face of the within instrument in every particular, without
alteration or enlargement or any change whatsoever.
20
ANNEX A
REPAYMENT ELECTION FORM
ALLSTATE LIFE GLOBAL FUNDING
ALLSTATE LIFE(R) CORENOTES(R)
CUSIP NO.
To: [Name of Trust]
The authorized representative (the "Authorized Representative") represents
the following:
o The Authorized Representative requests repayment of Allstate Life(R)
CoreNotes(R) (CUSIP No. ) (THe "Notes") of the deceased beneficial
owner listed below (the "Deceased Beneficial Owner").
o At the time of his or her death, the Deceased Beneficial Owner owned
Notes in the principal amount listed below.
o The Deceased Beneficial Owner acquired the Notes at least six (6)
months before the date of death of such Deceased Beneficial Owner.
The Authorized Representative agrees to the following terms:
o The Authorized Representative shall follow the instructions (the
"Instructions") accompanying this Repayment Election Form (this
"Form").
o The Authorized Representative shall make all records specified in the
Instructions supporting the above representations available to [J.P.
Morgan Trust Company, National Association] (the "Trustee") or [Name
of Trust] (the "Trust") for inspection and review within five Business
Days of the Indenture Trustee's or the Trust's request.
o If the Indenture Trustee or the Trust, in any such party's reasonable
discretion, deems any of the records specified in the Instructions
supporting the above representations unsatisfactory to substantiate a
claim for repayment, the Indenture Trustee or the Trust may deny
repayment. If the Authorized Representative cannot substantiate a
claim for repayment, it shall notify the Indenture Trustee and the
Trust immediately.
o Repayment elections may not be withdrawn.
o The Notes will be repaid on the first Interest Payment Date to occur
at least 20 calendar days after the date of acceptance of the Notes
for repayment, unless such date is not a business day, in which case
the date of repayment shall be the next succeeding business day.
o Subject to Allstate Life's right hereunder to limit the aggregate
principal amount of Funding Agreements securing notes as to which
exercises of any put option by the issuing trusts attributable to
notes as to which exercises of the Survivor's Option shall be accepted
in any one calendar year, all questions as to the eligibility or
validity of any exercise of the survivor's option will be determined
by the Indenture Trustee, in its sole discretion, which determination
shall be final and binding on all parties.
A-1
REPAYMENT ELECTION FORM
(1)________________________________________________________________________
Name of Deceased Beneficial Owner
(2)________________________________________________________________________
Date of Death
(3)________________________________________________________________________
Name of Authorized Representative Requesting Repayment
(4)________________________________________________________________________
Signature of Authorized Representative Requesting Repayment
(5)________________________________________________________________________
Principal Amount of Requested Repayment
(6)________________________________________________________________________
Date of Election
- -------------------------------------------------------------------------------
(7) Authorized Representative: (8) Wire instructions for payment:
Name: Bank Name:
Phone Number: ABA Number:
Fax Number: Account Name:
Mailing Address (no P.O. Boxes): Account Number:
Reference (optional):
TO BE COMPLETED BY THE INDENTURE TRUSTEE:
(A) Election Number*:
(B) Delivery and Payment Date:
(C) Principal Amount:
(D) Accrued Interest:
(E) Date of Receipt of Form by the Indenture Trustee:
(F) Date of Acknowledgment by the Indenture Trustee:
_______________________
* To be assigned by the Indenture Trustee upon receipt of this Form. An
acknowledgement, in the form of a copy of this document with the
assigned Election Number, will be returned to the party and location
designated in item (7) above.
A-2
INSTRUCTIONS FOR COMPLETING REPAYMENT ELECTION FORM AND EXERCISING
REPAYMENT OPTION
Capitalized terms used and not defined herein have the meanings defined
in the accompanying Repayment Election Form.
1. Collect and retain for a period of at least three years (1) satisfactory
evidence of the authority of the Authorized Representative, (2)
satisfactory evidence of death of the Deceased Beneficial Owner, (3)
satisfactory evidence that the Deceased Beneficial Owner beneficially
owned, at the time of his or her death, the Notes being submitted for
repayment, (4) satisfactory evidence that the Notes being submitted for
repayment were acquired by the Deceased Beneficial Owner at least six (6)
months before the date of the death of such Deceased Beneficial Owner, and
(5) any necessary tax waivers. For purposes of determining whether the
Notes will be deemed beneficially owned by an individual at any given time,
the following rules shall apply:
o If a Note (or a portion thereof) is beneficially owned by tenants by
the entirety or joint tenants, the Note (or relevant portion thereof)
will be regarded as beneficially owned by a single owner. Accordingly,
the death of a tenant by the entirety or joint tenant will be deemed
the death of the beneficial owner and the entire principal amount so
owned will become eligible for repayment.
o The death of a person beneficially owning a Note (or a portion
thereof) by tenancy in common will be deemed the death of the
beneficial owner only with respect to the deceased owner's interest in
the Note (or relevant portion thereof) so owned, unless a husband and
wife are the tenants in common, in which case the death of either will
be deemed the death of the beneficial owner and the entire principal
amount so owned will be eligible for repayment.
o A Note (or a portion thereof) beneficially owned by a trust will be
regarded as beneficially owned by each beneficiary of the trust to the
extent of that beneficiary's interest in the trust (however, a trust's
beneficiaries collectively cannot be beneficial owners of more Notes
than are owned by the trust). The death of a beneficiary of a trust
will be deemed the death of the beneficial owner of the Notes (or
relevant portion thereof) beneficially owned by the trust to the
extent of that beneficiary's interest in the trust. The death of an
individual who was a tenant by the entirety or joint tenant in a
tenancy which is the beneficiary of a trust will be deemed the death
of the beneficiary of the trust. The death of an individual who was a
tenant in common in a tenancy which is the beneficiary of a trust will
be deemed the death of the beneficiary of the trust only with respect
to the deceased holder's beneficial interest in the Note, unless a
husband and wife are the tenants in common, in which case the death of
either will be deemed the death of the beneficiary of the trust.
o The death of a person who, during his or her lifetime, was entitled to
substantially all of the beneficial interest in a Note (or a portion
thereof) will be deemed the death of the beneficial owner of that Note
(or relevant portion thereof), regardless of the registration of
ownership, if such beneficial interest can be established to the
satisfaction of the Indenture Trustee. Such beneficial interest will
exist in many cases of street name or nominee ownership, custodial
arrangements, ownership by a trustee, ownership under the Uniform
Transfers of Gifts to Minors Act and community property or other joint
ownership arrangements between spouses. Beneficial interest will be
evidenced by such factors as the power to sell or otherwise dispose of
a Note, the right to receive the proceeds of sale or disposition and
the right to receive interest and principal payments on a Note.
2. Indicate the name of the Deceased Beneficial Owner on line (1).
3. Indicate the date of death of the Deceased Beneficial Owner on line (2).
4. Indicate the name of the Authorized Representative requesting repayment on
line (3).
5. Affix the authorized signature of the Authorized Representative on line
(4).
A-3
6. Indicate the principal amount of Notes to be repaid on line (5).
7. Indicate the date this Form was completed on line (6).
8. Indicate the name, mailing address (no P.O. boxes, please), telephone
number and facsimile-transmission number of the party to whom the
acknowledgment of this election may be sent in item (7).
9. Indicate the wire instruction for payment on line (8).
10. Leave lines (A), (B), (C), (D), (E) and (F) blank.
11. Mail or otherwise deliver an original copy of the completed Form to:
[J.P. Morgan Trust Company, National Association
227 W. Monroe Street, Suite 2600
Chicago, IL 60606]
12. FACSIMILE TRANSMISSIONS OF THE REPAYMENT ELECTION FORM WILL NOT BE
ACCEPTED.
13. If the acknowledgement of the Indenture Trustee's receipt of this Form,
including the assigned Election Number, is not received within 10 days of
the date such information is sent to the Trustee, contact the Trustee at
[J.P. Morgan Trust Company, National Association, 227 W. Monroe Street,
Suite 2600, Chicago, IL 60606].
14. For assistance with this Form or any questions relating thereto, please
contact the Trustee at [J.P. Morgan Trust Company, National Association,
227 W. Monroe Street, Suite 2600, Chicago, IL 60606].
A-4
Exhibit 4.12
===============================================================================
FORM OF SERIES INSTRUMENT
===============================================================================
TABLE OF CONTENTS
PAGE
PART A TRUST AGREEMENT............................................................................. 1
PART B ADMINISTRATIVE SERVICES AGREEMENT........................................................... 3
PART C SUPPORT AND EXPENSES AGREEMENT.............................................................. 5
PART D NAME LICENSING AGREEMENT.................................................................... 7
PART E TERMS AGREEMENT............................................................................. 9
PART F COORDINATION AGREEMENT...................................................................... 13
PART G INDENTURE................................................................................... 18
PART H FUNDING NOTE INDENTURE...................................................................... 20
PART I MISCELLANEOUS AND EXECUTION PAGES........................................................... 22
EXHIBIT A STANDARD TRUST AGREEMENT TERMS............................................................. A-1
EXHIBIT B STANDARD ADMINISTRATIVE SERVICES AGREEMENT TERMS........................................... B-1
EXHIBIT C STANDARD SUPPORT AND EXPENSES AGREEMENT TERMS.............................................. C-1
EXHIBIT D STANDARD NAME LICENSING AGREEMENT TERMS.................................................... D-1
EXHIBIT E DISTRIBUTION AGREEMENT..................................................................... E-1
EXHIBIT F CERTIFICATE OF TRUST....................................................................... F-1
EXHIBIT G STANDARD INDENTURE TERMS................................................................... G-1
EXHIBIT H STANDARD FUNDING NOTE INDENTURE TERMS...................................................... H-1
ANNEX A PRICING SUPPLEMENT...................................................................... A-A-1
ANNEX B DELAWARE TRUSTEE SERVICE FEE SCHEDULE................................................... A-B-1
ANNEX C ADMINISTRATOR SERVICE FEE SCHEDULE...................................................... A-C-1
ANNEX D AGENT NOTICE INFORMATION................................................................ A-D-1
ANNEX E INDENTURE SERVICE FEE SCHEDULE.......................................................... A-E-1
i
WHEREAS, the parties named herein desire to enter into certain documents
relating to the issuance by Allstate Life Global Funding Trust - (the "Trust")
of Notes to investors under Allstate Life Global Funding's ("Global Funding")
secured medium term notes program;
WHEREAS, the Trust will be created under and its activities will be
governed by (i) the provisions of the Trust Agreement (set forth in Part A of
this Series Instrument), dated as of the date of the Pricing Supplement
(attached to this Series Instrument as Annex A) (the "Pricing Supplement"),
between the parties thereto indicated in Part I hereof, and (ii) the Certificate
of Trust (attached as Exhibit F to this Series Instrument);
WHEREAS, the Trust will be administered pursuant to the provisions of the
Administrative Services Agreement (set forth in Part B of this Series
Instrument), dated as of the date of the Pricing Supplement, between the parties
thereto indicated in Part I hereof;
WHEREAS, certain costs and expenses of the Trust and the service providers
to the Trust will be paid pursuant to the Support and Expenses Agreement (set
forth in Part C of this Series Instrument), dated as of the date of the Pricing
Supplement, between the parties thereto indicated in Part I hereof;
WHEREAS, certain licensing arrangements between the Trust and Allstate
Insurance Company will be governed pursuant to the provisions of the Name
Licensing Agreement (set forth in Part D of this Series Instrument), dated as of
the date of the Pricing Supplement, between the parties thereto indicated in
Part I hereof;
WHEREAS, the sale of the Notes will be governed by the Terms Agreement (set
forth in Part E of this Series Instrument), dated as of the date of the Pricing
Supplement, among the parties thereto indicated in Part I hereof;
WHEREAS, certain agreements relating to the Notes and the Funding
Agreement(s) are set forth in the Coordination Agreement (set forth in Part F of
this Series Instrument), dated as of the date of the Pricing Supplement, among
the parties thereto indicated in Part I hereof;
WHEREAS, the Notes will be issued pursuant to the Indenture (set forth in
Part G hereof) (the "Indenture"), effective as of the Original Issue Date
specified in the Pricing Supplement (the "Original Issue Date"), between the
parties thereto indicated in Part I hereof;
WHEREAS, the Funding Note will be issued pursuant to the Funding Note
Indenture (set forth in Part H hereof), effective as of the Original Issue Date,
between the parties thereto indicated in Part I hereof; and
All capitalized terms used in the above recitals and not otherwise defined
will have the meanings set forth in the Indenture.
ii
PART A
TRUST AGREEMENT
This TRUST AGREEMENT, dated as of the date of the Pricing Supplement
attached to the Series Instrument as Annex A (the "Pricing Supplement"), among
Allstate Life Global Funding, a Delaware statutory trust, as trust beneficial
owner (the "Trust Beneficial Owner"), AMACAR Pacific Corp., a Delaware
corporation, as the sole administrator of the Trust (the "Administrator") and
Wilmington Trust Company, a Delaware banking corporation, as Delaware trustee
(the "Delaware Trustee"),
W I T N E S S E T H:
WHEREAS, the Trust Beneficial Owner, the Administrator and the Delaware
Trustee desire to authorize the issuance of Notes in connection with the entry
into this Trust Agreement;
WHEREAS, all things necessary to make this Trust Agreement a valid and
legally binding agreement of the Delaware Trustee, the Administrator and the
Trust Beneficial Owner, enforceable in accordance with its terms, have been
done;
WHEREAS, the parties intend to provide for, among other things, (i) the
issuance and sale of the Notes (pursuant to the Indenture set forth in Part G of
the Series Instrument and the Terms Agreement set forth in Part E of the Series
Instrument), (ii) the use of the proceeds of the sale of the Notes to acquire
the Funding Note, which will be surrendered in consideration for the Funding
Agreement(s), and (iii) all other actions deemed necessary or desirable in
connection with the transactions contemplated by this Trust Agreement; and
WHEREAS, the parties hereto desire to incorporate by reference the Standard
Trust Agreement Terms attached to the Series Instrument as Exhibit A (the
"Standard Trust Agreement Terms," together with this Trust Agreement,
collectively, the "Trust Agreement");
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, each party hereby agrees as follows:
ARTICLE 1
SECTION 1.1 Incorporation by Reference. All terms, provisions and
agreements of the Standard Trust Agreement Terms (except to the extent expressly
modified herein) are hereby incorporated herein by reference with the same force
and effect as though fully set forth herein. To the extent that the terms set
forth in Article 2 of this Trust Agreement are inconsistent with the terms of
the Standard Trust Agreement Terms, the terms set forth in Article 2 hereof
shall apply.
SECTION 1.2 Definitions. "Series Instrument" means the Series Instrument in
which this Trust Agreement is included as Part A. All capitalized terms not
otherwise defined in this Trust Agreement shall have the meanings set forth in
the Standard Trust Agreement Terms.
1
ARTICLE 2
SECTION 2.1 Name. The Trust created and governed by this Trust Agreement
shall have the name specified in the Series Instrument.
SECTION 2.2 Ownership of the Trust. Upon the creation of the Trust, Global
Funding shall be the sole beneficial owner of the Trust.
SECTION 2.3 Acknowledgment. The Delaware Trustee, the Trust Beneficial
Owner and the Administrator expressly acknowledge their duties and obligations
set forth in the Standard Trust Agreement Terms incorporated herein.
SECTION 2.4 Compensation. The Delaware Trustee shall be entitled to receive
the fees specified in the Delaware Trustee Service Fee Schedule, which is
attached as Annex B to the Series Instrument.
SECTION 2.5 Additional Terms. [None].
SECTION 2.6 Series Instrument; Execution and Incorporation of Terms. The
parties to this Trust Agreement will enter into this Trust Agreement by
executing the Series Instrument.
By executing the Series Instrument, the Delaware Trustee, the Administrator
and the Trust Beneficial Owner hereby agree that this Trust Agreement will
constitute a legal, valid and binding agreement among the Delaware Trustee, the
Administrator and the Trust Beneficial Owner.
All terms relating to the Trust or the Notes not otherwise included in this
Trust Agreement will be as specified in the Series Instrument or the Pricing
Supplement.
SECTION 2.7 Counterparts. This Trust Agreement, through the Series
Instrument, may be executed in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.
2
PART B
ADMINISTRATIVE SERVICES AGREEMENT
This ADMINISTRATIVE SERVICES AGREEMENT, dated as of the date of the Pricing
Supplement attached to the Series Instrument as Annex A (the "Pricing
Supplement"), between the Allstate Life Global Funding Trust specified in the
Series Instrument (the "Trust") and AMACAR Pacific Corp., a Delaware corporation
(the "Administrator"),
W I T N E S S E T H:
WHEREAS, the Trust has requested that the Administrator perform various
services for the Trust;
WHEREAS, the Trust desires to have the Administrator perform various
financial, statistical, accounting and other services for the Trust, and the
Administrator is willing to furnish such services on the terms and conditions
herein set forth; and
WHEREAS, the parties hereto desire to incorporate by reference those
certain Standard Administrative Services Agreement Terms attached to the Series
Instrument as Exhibit B (the "Standard Administrative Services Agreement Terms,"
together with this Administrative Services Agreement, collectively, the
"Administrative Services Agreement");
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, each party hereby agrees as follows:
ARTICLE 1
SECTION 1.1 Incorporation by Reference. All terms, provisions and
agreements of the Standard Administrative Services Agreement Terms (except to
the extent expressly modified herein) are hereby incorporated herein by
reference with the same force and effect as though fully set forth herein. To
the extent that the terms set forth in Article 2 of this Administrative Services
Agreement are inconsistent with the terms of the Standard Administrative
Services Agreement Terms, the terms set forth in Article 2 hereof shall apply.
SECTION 1.2 Definitions. "Series Instrument" means the Series Instrument in
which this Administrative Services Agreement is included as Part B. All
capitalized terms not otherwise defined in this Administrative Services
Agreement shall have the meanings set forth in the Standard Administrative
Services Agreement Terms.
ARTICLE 2
SECTION 2.1 Compensation. The Administrator shall be entitled to receive
the fees specified in the Administrator Service Fee Schedule, which is attached
as Annex C to the Series Instrument.
SECTION 2.2 Additional Terms. [None].
3
SECTION 2.3 Series Instrument; Execution and Incorporation of Terms. The
parties to this Administrative Services Agreement will enter into this
Administrative Services Agreement by executing the Series Instrument.
By executing the Series Instrument, Wilmington Trust Company (the "Delaware
Trustee"), on behalf of the Trust, and the Administrator hereby agree that this
Administrative Services Agreement will constitute a legal, valid and binding
agreement between the Trust and the Administrator.
All terms relating to the Trust or the Notes not otherwise included in this
Administrative Services Agreement will be as specified in the Series Instrument
or Pricing Supplement.
SECTION 2.4 Counterparts. This Administrative Services Agreement, through
the Series Instrument, may be executed in any number of counterparts, each of
which counterparts shall be deemed to be an original, and all of which
counterparts shall constitute but one and the same instrument.
SECTION 2.5 Third Party Beneficiary. The parties hereto acknowledge that
the Delaware Trustee shall be an express third party beneficiary of this
Administrative Services Agreement, entitled in its own name and on its own
behalf to enforce the provisions hereof against the Trust and the Administrator
with respect to obligations owed to the Delaware Trustee by either the Trust or
the Administrator; provided, however, that such right shall be valid only for so
long as the Delaware Trustee has any outstanding obligations or potential
obligations under the Trust Agreement.
4
PART C
SUPPORT AND EXPENSES AGREEMENT
This SUPPORT AND EXPENSES AGREEMENT, dated as of the date of the Pricing
Supplement attached to the Series Instrument as Annex A (the "Pricing
Supplement"), between Allstate Life Insurance Company, an Illinois stock life
insurance company ("Allstate Life") and the Allstate Life Global Funding Trust
specified in the Series Instrument (the "Trust"),
W I T N E S S E T H:
WHEREAS, in consideration of the Service Providers providing services
to the Trust in connection with the Program and pursuant to the agreements and
other documents contained in the Series Instrument and the Closing Instrument to
be executed for the Trust, under which the Service Providers will have certain
duties and obligations, Allstate Life hereby agrees to the following
compensation arrangements and terms of indemnity; and
WHEREAS, the parties hereto desire to incorporate by reference the
Standard Support and Expenses Agreement Terms attached to the Series Instrument
as Exhibit C (the "Standard Support Agreement Terms," together with this Support
and Expenses Agreement, collectively, the "Support Agreement");
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, each party hereby agrees as follows:
ARTICLE 1
SECTION 1.1 Incorporation by Reference. All terms, provisions and
agreements of the Standard Support Agreement Terms (except to the extent
expressly modified herein) are hereby incorporated herein by reference with the
same force and effect as though fully set forth herein. To the extent that the
terms set forth in Article 2 of this Support Agreement are inconsistent with the
terms of the Standard Support Agreement Terms, the terms set forth in Article 2
hereof shall apply.
SECTION 1.2 Definitions. "Series Instrument" means the Series Instrument in
which this Support Agreement is included as Part C. All capitalized terms not
otherwise defined in this Support Agreement shall have the meanings set forth in
the Standard Support Agreement Terms.
ARTICLE 2
SECTION 2.1 Additional Terms. [None].
SECTION 2.2 Series Instrument; Execution and Incorporation of Terms. The
parties to this Support Agreement will enter into this Support Agreement by
executing the Series Instrument.
5
By executing the Series Instrument, each party hereto agrees that this
Support Agreement will constitute a legal, valid and binding agreement by and
among such parties.
All terms relating to the Trust or the Notes not otherwise included in this
Support Agreement will be as specified in the Series Instrument or Pricing
Supplement.
SECTION 2.3 Counterparts. This Support Agreement, through the Series
Instrument, may be executed in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.
6
PART D
NAME LICENSING AGREEMENT
This NAME LICENSING AGREEMENT, dated as of the date of the Pricing
Supplement attached to the Series Instrument as Annex A (the "Pricing
Supplement"), between Allstate Insurance Company (the "Licensor"), an Illinois
stock life insurance company, and the Allstate Life Global Funding Trust
specified in the Series Instrument (the "Licensee"),
W I T N E S S E T H:
WHEREAS, Licensor is the owner of certain tradenames, trademarks and
service marks and registrations and pending applications therefor, and may
acquire additional tradenames, trademarks and service marks in the future
(collectively, "Licensor's Marks");
WHEREAS, Licensee desires to use certain of Licensor's Marks and use
Allstate Life as part of its company name;
WHEREAS, Licensor and Licensee wish to formalize the agreement between them
regarding Licensee's use of Licensor's Marks; and
WHEREAS, the parties hereto desire to incorporate by reference those
certain Standard Name Licensing Agreement Terms attached to the Series
Instrument as Exhibit D (the "Standard Name Licensing Agreement Terms," together
with this Name Licensing Agreement, collectively, the "Name Licensing
Agreement");
NOW, THEREFORE, in consideration of the mutual promises set forth in this
Name Licensing Agreement and other good and valuable consideration, the
sufficiency and receipt of which is hereby acknowledged, the parties agree as
follows:
ARTICLE 1
SECTION 1.1 Incorporation by Reference. All terms, provisions and
agreements set forth in the Standard Name Licensing Agreement Terms (except to
the extent expressly modified herein) are hereby incorporated herein by
reference with the same force and effect as though fully set forth herein. To
the extent that the terms set forth in Article 2 of this Name Licensing
Agreement are inconsistent with the terms of the Standard Name Licensing
Agreement Terms, the terms set forth in Article 2 hereof shall apply.
SECTION 1.2 Definitions. "Series Instrument" means the Series Instrument in
which this Name Licensing Agreement is included as Part D. All capitalized terms
not otherwise defined in this Name Licensing Agreement shall have the meanings
set forth in the Standard Name Licensing Agreement Terms.
7
ARTICLE 2
SECTION 2.1 Additional Terms. [None].
SECTION 2.2 Series Instrument; Execution and Incorporation of Terms. The
parties to this Name Licensing Agreement will enter into this Name Licensing
Agreement by executing the Series Instrument.
By executing the Series Instrument, Licensor and the Licensee hereby agree
that this Name Licensing Agreement will constitute a legal, valid and binding
agreement between Licensor and the Licensee.
All terms relating to the Trust or the Notes not otherwise included in this
Name Licensing Agreement will be as specified in the Series Instrument or
Pricing Supplement.
SECTION 2.3 Counterparts. This Name Licensing Agreement, through the Series
Instrument, may be executed in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.
8
PART E
TERMS AGREEMENT
This TERMS AGREEMENT, dated as of the date of the Pricing Supplement
attached to the Series Instrument as Annex A (the "Pricing Supplement"), among
each agent specified in the Pricing Supplement (each, an "Agent"), Allstate Life
Global Funding, a Delaware statutory trust ("Global Funding") and the Allstate
Life Global Funding Trust specified in the Series Instrument (the "Trust"),
W I T N E S S E T H:
WHEREAS, all things necessary to make this Terms Agreement a valid and
legally binding agreement of the Trust, Global Funding and the other parties to
this Terms Agreement, enforceable in accordance with its terms, have been done,
and the Trust proposes to do all things necessary to make the notes referred to
in Section 1.4 below (the "Notes"), when executed by the Trust and authenticated
and delivered pursuant hereto and the Indenture set forth in Part G of the
Series Instrument, valid and legally binding obligations of the Trust as
hereinafter provided; and
WHEREAS, the parties hereto desire to incorporate by reference the
Distribution Agreement attached to the Series Instrument as Exhibit E (the
"Distribution Agreement", together with this Terms Agreement, collectively, the
"Terms Agreement");
NOW, THEREFORE, for and in consideration of the premises and the issuance
of the Notes by the Trust, it is mutually agreed by the parties hereto as
follows:
ARTICLE 1
SECTION 1.1 Agreement to Be Bound. Global Funding, the Trust and each Agent
hereby agree to be bound by all of the terms, provisions and agreements set
forth herein, with respect to all matters contemplated herein, including,
without limitation, those relating to the issuance of the Notes.
SECTION 1.2 Incorporation by Reference. All terms, provisions and
agreements set forth in the Distribution Agreement (except to the extent
expressly modified hereby) are hereby incorporated herein by reference (as if
fully set forth herein). Should any portion of the Distribution Agreement
conflict with the terms of this Terms Agreement, the terms of this Terms
Agreement shall prevail. References herein to Sections or Exhibits shall refer
respectively to the sections or exhibits of the Distribution Agreement, unless
otherwise expressly provided.
SECTION 1.3 Addition of Trust as Party to Distribution Agreement. Pursuant
to the Distribution Agreement, each of the parties hereto acknowledges and
agrees that the Trust, upon execution hereof by the Trust, Global Funding and
the applicable Agent(s), shall become an "Issuing Trust" for purposes of the
Distribution Agreement in accordance with the terms thereof, in respect of the
Notes, with all the authority, rights, powers, duties and obligations of an
"Issuing Trust" under the Distribution Agreement. The Trust confirms that any
agreement, covenant, acknowledgment, representation or warranty under the
Distribution Agreement applicable to the Trust is made by the Trust at the date
hereof, unless another time or times are specified in the Distribution
Agreement, in which case such agreement, covenant,
9
acknowledgment, representation or warranty shall be deemed to be confirmed by
the Trust at such specified time or times.
SECTION 1.4 Designation of the Trust and the Notes. The Trust referred to
in this Terms Agreement is the Allstate Life Global Funding Trust specified in
the Series Instrument. The Notes issued by the Trust pursuant to the Terms
Agreement shall be the notes specified in the Pricing Supplement.
SECTION 1.5 Additional Terms. [None].
SECTION 1.6 Definitions. "Series Instrument" means the Series Instrument in
which this Terms Agreement is included as Part E. All capitalized terms not
otherwise defined in this Terms Agreement shall have the meanings set forth in
the Distribution Agreement.
SECTION 1.7 Applicable Time. For purposes of the Distribution Agreement,
the Applicable Time shall be -.
SECTION 1.8 Free Writing Prospectuses. [Attached as, or identified in,
Exhibit A hereto is a copy of each free writing prospectus (as defined in Rule
405 under the Securities Act of 1933, as amended), and any other information,
which will constitute a part of the Time of Sale Prospectus relating to the
offer and sale of the Notes.] [The parties have prepared a final term sheet (the
"Final Term Sheet") reflecting the final terms of the Notes, which is attached
as Exhibit A hereto, and which will constitute a part of the Time of Sale
Prospectus relating to the offer and sale of the Notes. Global Funding, on
behalf of the Trust, shall file the Final Term Sheet in accordance with, and to
the extent required by, Rule 433 under the Securities Act of 1933, as amended,
within the time period required thereunder.]
ARTICLE 2
SECTION 2.1 Purchase/Solicitation of Purchases of Notes.
(a) If specified in the Pricing Supplement, the Notes are being
purchased by the Agent(s) as principal. If the Notes are to be
purchased by the Agent(s) as principal, the Agent(s) specified in
the Pricing Supplement [severally and not jointly] agree to
purchase the Notes having the terms and in the amounts specified
in the Pricing Supplement.
(b) If specified in the Pricing Supplement, the Agent(s) will be
acting as agent. If the Agent(s) are to solicit the purchase of
the Notes acting as agents, the Agent(s) will solicit the
purchase of Notes pursuant to Section 1(d) of the Distribution
Agreement.
SECTION 2.2 Patriot Act. [Each of the Agents hereby represents and warrants
that it has in place and makes every effort to comply with anti-money laundering
policies and procedures in accordance with the requirements imposed by the
Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act), Pub. L, 107-56,
115 Stat. 380 (October 26, 2001), or any rules or regulations promulgated
thereunder, and the Foreign Assets Control Regulations issued by the
10
Office of Foreign Assets Control of the United States Department of the Treasury
(31 CFR Part 500), in each case to the extent applicable to it. Each of the
Agents also represents and warrants that it has implemented and makes every
effort to comply with an anti-money laundering compliance program pursuant to
NASD Rule 3011.]
SECTION 2.3 Funding Agreement(s). On the Original Issue Date set forth in
the Pricing Supplement, Global Funding will grant a security interest in, pledge
and collaterally assign the Funding Agreement(s) identified in the Pricing
Supplement to the Funding Note Indenture Trustee and will immediately thereafter
assign absolutely to and deposit into the Trust each such Funding Agreement.
SECTION 2.4 Agent Notice Information. As specified in Annex D to the Series
Instrument.
ARTICLE 3
SECTION 3.1 Series Instrument; Execution and Incorporation of Terms. The
parties to this Terms Agreement will enter into this Terms Agreement by
executing the Series Instrument.
By executing the Series Instrument, each party hereto agrees that this
Terms Agreement will constitute a legal, valid and binding agreement by and
among the Trust, Allstate Life Global Funding and the Agent(s).
All terms relating to the Trust or the Notes not otherwise included in this
Terms Agreement will be as specified in the Series Instrument or Pricing
Supplement.
SECTION 3.2 Counterparts. This Terms Agreement, through the Series
Instrument, may be executed in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.
11
[EXHIBIT A TO PART E]
12
PART F
COORDINATION AGREEMENT
This COORDINATION AGREEMENT (this "Coordination Agreement"), dated as of
the date of the Pricing Supplement attached to the Series Instrument as Annex A
(the "Pricing Supplement"), among Allstate Life Insurance Company ("Allstate
Life"), Allstate Life Global Funding ("Global Funding"), the Allstate Life
Global Funding Trust specified in the Series Instrument (the "Trust"), J.P.
Morgan Trust Company, National Association (the "Indenture Trustee") and the
Collateral Custodian (as defined below),
W I T N E S S E T H:
WHEREAS, the Trust intends to issue the Notes specified in the Pricing
Supplement (the "Notes") in accordance with the Indenture set forth in Part G of
the Series Instrument (the "Indenture");
WHEREAS, the Agent(s) have agreed to sell the Notes in accordance with the
Registration Statement;
WHEREAS, the Trust intends to purchase the Funding Note issued by Global
Funding and dated as of the Original Issue Date specified in the Pricing
Supplement (the "Funding Note") with the net proceeds from the sale of the
Notes;
WHEREAS, Global Funding intends to sell the Funding Note to the Trust and
use the proceeds therefrom to purchase the Funding Agreement(s) described in the
Pricing Supplement (the "Funding Agreement(s)") from Allstate Life;
WHEREAS, Allstate Life intends to sell the Funding Agreement(s) to Global
Funding in consideration for the proceeds Global Funding receives from the sale
of the Funding Note;
WHEREAS, Global Funding intends to immediately assign absolutely to, and
deposit into, the Trust the Funding Agreement(s), and the Funding Note will be
surrendered;
WHEREAS, the Trust intends to issue the Notes and to collaterally assign
the Funding Agreement(s) to the Indenture Trustee to secure payment of the
Notes; and
WHEREAS, the Trust intends to grant a security interest in the Funding
Agreement(s) to the Indenture Trustee;
NOW, THEREFORE, to give effect to the agreements and arrangements
established under the Terms Agreement set forth in Part E of the Series
Instrument, the Trust Agreement set forth in Part A of the Series Instrument,
the Indenture set forth in Part G of the Series Instrument, and the Notes, and
in consideration of the agreements and obligations set forth herein and for
other good and valuable consideration, the sufficiency of which is hereby
acknowledged, each party hereby agrees as follows:
13
ARTICLE 1
PURCHASE OF FUNDING NOTE
The Trust hereby agrees to purchase the Funding Note from Global Funding
with the net proceeds from the sale of the Notes. Global Funding hereby agrees
to sell the Funding Note to the Trust in consideration for the net proceeds from
the sale of the Notes.
ARTICLE 2
PURCHASE OF FUNDING AGREEMENT(S)
Allstate Life hereby agrees to sell the Funding Agreement(s) to Global
Funding in consideration for the proceeds Global Funding receives from the sale
of the Funding Note. Global Funding hereby agrees to immediately purchase the
Funding Agreement(s) with the proceeds Global Funding receives from the sale of
the Funding Note.
ARTICLE 3
SALE OF FUNDING AGREEMENT(S);
CANCELLATION OF FUNDING NOTE
Global Funding hereby agrees to assign absolutely to and deposit into the
Trust the Funding Agreement(s), and the Funding Note will be surrendered. The
Trust hereby agrees to accept the Funding Agreement(s) from Global Funding in
consideration for the Trust's surrender of the Funding Note. The Funding Note
shall be cancelled by Global Funding immediately upon such surrender, and such
cancellation shall operate as a redemption and satisfaction of the Funding Note.
ARTICLE 4
DELIVERY OF THE FUNDING AGREEMENT(S)
Global Funding, the Trust, the Funding Note Indenture Trustee and the
Indenture Trustee hereby appoint the Chicago, Illinois office of J.P. Morgan
Trust Company, National Association, to act as custodian for the Funding
Agreement(s) (the "Collateral Custodian") in connection with (i) the sale of the
Funding Agreement(s) by Allstate Life to Global Funding pursuant to Article 2
above, (ii) the sale and deposit of the Funding Agreement(s) by Global Funding
to the Trust pursuant to Article 3 above, (iii) the collateral assignment of the
Funding Agreement(s) by the Trust to the Indenture Trustee and (iv) any
subsequent permitted transfer of the Funding Agreement(s) by the Indenture
Trustee, and in such capacity to accept and hold in its physical custody the
Funding Agreement(s) in the State of Illinois until such time when the Indenture
Trustee notifies the Collateral Custodian in writing to the contrary, in
connection with the release of the Funding Agreement(s) in accordance with the
terms of the Indenture or upon the occurrence and during the continuation of an
Event of Default (as defined in the Standard Indenture Terms attached as Exhibit
G to the Series Instrument) whereupon such physical custody and possession of
the Funding Agreement(s) will be transferred to the Indenture Trustee or another
person in the manner directed by the Indenture Trustee. The Collateral
Custodian, hereby accepts such appointment and agrees to perform all of its
obligations as Collateral Custodian for the Funding Agreement(s).
14
ARTICLE 5
PERIODIC PAYMENTS; MATURITY
SECTION 5.1 Directions Regarding Periodic Payments. As registered owner of
the Funding Agreement(s) as collateral securing payments on the Notes, the
Indenture Trustee will receive payments on the Funding Agreement(s) on behalf of
the Trust. The Trust hereby directs the Indenture Trustee to use such funds to
make payments on behalf of the Trust pursuant to the Trust Agreement and the
Indenture.
SECTION 5.2 Amendment to Directions.
(a) The Trust may, at any time and at its sole discretion, amend the
directions set forth in Section 5.1 in accordance with the Trust
Agreement and the Indenture.
(b) Any notice to a payor of the change in identity of any payee or
the appointment of any successor payee, which notice is
acknowledged by the Trust, shall be deemed to be an amendment to
these directions which replaces such new payee for the payee
named in these directions.
SECTION 5.3 Maturity of the Funding Agreement(s). Upon the maturity of the
Funding Agreement(s) and the return of funds thereunder, the Trust hereby
directs the Indenture Trustee to set aside from such funds an amount sufficient
for the repayment of the outstanding amounts on the Notes when due.
ARTICLE 6
MISCELLANEOUS
SECTION 6.1 No Additional Liability. Nothing in this Coordination Agreement
shall impose any liability or obligation on the part of any party to this
Coordination Agreement to make any payment or disbursement in addition to any
liability or obligation such party has under the other documents related to the
Program Documents (as defined in the Standard Administrative Services Agreement
Terms set forth as Exhibit B to the Series Instrument), except to the extent
that a party has actually received funds which it is obligated to disburse
pursuant to this Coordination Agreement.
SECTION 6.2 No Conflict. This Coordination Agreement is intended to be in
furtherance of the agreements reflected in the documents related to the Program
Documents, and not in conflict. To the extent that a provision of this
Coordination Agreement conflicts with the provisions of one or more Program
Documents, the provisions of such Program Documents shall govern.
SECTION 6.3 Governing Law. This Coordination Agreement shall be governed by
and construed in accordance with the laws of the State of New York without
regard to the principles of conflicts of laws thereof.
SECTION 6.4 Definitions. "Series Instrument" means the Series Instrument in
which this Coordination Agreement is included as Part F. All capitalized terms
not otherwise
15
defined in this Coordination Agreement shall have the meanings set forth in the
Distribution Agreement.
SECTION 6.5 Severability. If any provision of this Coordination Agreement
shall be invalid, illegal or unenforceable, such provisions shall be deemed
severable from the remaining provisions of this Coordination Agreement and shall
in no way affect the validity or enforceability of such other provisions of this
Coordination Agreement.
SECTION 6.6 Counterparts. This Coordination Agreement, through the Series
Instrument, may be executed in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute but one and the same instrument.
SECTION 6.7 Notices. All demands, notices and communications under this
Coordination Agreement shall be in writing and shall be deemed to have been duly
given upon receipt at the addresses set forth below:
if to Allstate Life, at
Allstate Life Insurance Company
3100 Sanders Road
Northbrook, IL 60062
Attention: Secretary
if to Global Funding, at
Allstate Life Global Funding
c/o AMACAR Pacific Corp.
6525 Morrison Boulevard, Suite 318
Charlotte, NC 28211
Attention: President
if to the Funding Note Indenture Trustee, at
J.P. Morgan Trust Company, National Association
227 W. Monroe Street, Suite 2600
Chicago, IL 60606
Attention: -
if to the Trust, at
Allstate Life Global Funding Trust
c/o AMACAR Pacific Corp.
6525 Morrison Boulevard, Suite 318
Charlotte, NC 28211
Attention: President
16
if to the Indenture Trustee, at
J.P. Morgan Trust Company, National Association 227 W. Monroe
Street, Suite 2600,
Chicago, IL 60606
Attention: -
or at such other address as shall be designated by any such party in a written
notice to the other parties.
17
PART G
INDENTURE
This INDENTURE (together with the Standard Indenture Terms (as defined
below), the "Indenture"), entered into as of the Original Issue Date specified
in the Pricing Supplement attached to the Series Instrument as Annex A (the
"Pricing Supplement"), among the Allstate Life Global Funding Trust specified in
the Series Instrument (the "Trust") and J.P. Morgan Trust Company, National
Association, as Indenture Trustee, Registrar, Exchange Rate Agent, Paying Agent
and Calculation Agent hereunder,
W I T N E S S E T H:
WHEREAS, the Trust has duly authorized the execution and delivery of this
Indenture to provide for the issuance of the secured notes referred to in
Section 2.2 below (the "Notes");
WHEREAS, all things necessary to make this Indenture a valid and legally
binding agreement of the Trust and the other parties to this Indenture,
enforceable in accordance with its terms, have been done, and the Trust proposes
to do all things necessary to make the Notes, when executed by the Trust and
authenticated and delivered pursuant hereto, valid and legally binding
obligations of the Trust as hereinafter provided; and
WHEREAS, the parties hereto desire to incorporate by reference those
certain Standard Indenture Terms attached to the Series Instrument as Exhibit G
(the "Standard Indenture Terms");
NOW, THEREFORE, for and in consideration of the premises and the purchase
of the Notes by the Holders thereof, it is mutually covenanted and agreed by the
parties hereto as follows:
ARTICLE 1
SECTION 1.1 Incorporation by Reference. All terms, provisions and
agreements set forth in the Standard Indenture Terms (except to the extent
expressly modified hereby) are hereby incorporated herein by reference (as if
fully set forth herein). Should any portion of the Standard Indenture Terms
conflict with the terms of this Indenture, the terms of this Indenture shall
prevail. References herein to Articles, Sections or Exhibits shall refer
respectively to the articles, sections or exhibits of the Standard Indenture
Terms, unless otherwise expressly provided.
SECTION 1.2 Definitions. "Series Instrument" means the Series Instrument in
which this Indenture is included as Part G. All capitalized terms not otherwise
defined in this Indenture shall have the meanings set forth in the Standard
Indenture Terms.
ARTICLE 2
SECTION 2.1 Agreement to Be Bound. Each of the Trust, the Indenture
Trustee, the Registrar, the Exchange Rate Agent, the Paying Agent and the
Calculation Agent hereby agrees to be bound by all of the terms, provisions and
agreements set forth herein, with respect to all
18
matters contemplated herein, including, without limitation, those relating to
the issuance of the Notes.
SECTION 2.2 Designation of the Trust and the Notes. The Trust referred to
in this Indenture is the Allstate Life Global Funding Trust specified in the
Series Instrument. The Notes issued by the Trust and governed by this Indenture
shall be the Notes specified in the Pricing Supplement.
SECTION 2.3 Compensation. The Indenture Trustee, the Registrar, the
Exchange Rate Agent, the Paying Agent and the Calculation Agent shall be
entitled to receive the fees specified in the Indenture Service Fee Schedule,
which is attached as Annex E to the Series Instrument.
SECTION 2.4 Additional Terms. [None].
SECTION 2.5 Series Instrument; Execution and Incorporation of Terms. The
parties to this Indenture will enter into this Indenture by executing the Series
Instrument.
By executing the signature page thereto, the parties hereby agree that this
Indenture will constitute a legal, valid and binding agreement among the parties
hereto.
All terms relating to the Trust or the Notes not otherwise included in this
Indenture will be as specified in the Series Instrument or the Pricing
Supplement.
SECTION 2.6 Counterparts. This Indenture, through the Series Instrument,
may be executed in any number of counterparts, each of which counterparts shall
be deemed to be an original, and all of which counterparts shall constitute one
and the same instrument.
19
PART H
FUNDING NOTE INDENTURE
This FUNDING NOTE INDENTURE (together with the Standard Funding Note
Indenture Terms (as defined below), the "Funding Note Indenture"), entered into
as of the Original Issue Date specified in the Pricing Supplement attached to
the Series Instrument as Annex A (the "Pricing Supplement"), among Allstate Life
Global Funding ("Global Funding") and J.P. Morgan Trust Company, National
Association, as Funding Note Indenture Trustee, Funding Note Registrar, Funding
Note Exchange Rate Agent, Funding Note Paying Agent and Funding Note Calculation
Agent,
W I T N E S S E T H:
WHEREAS, Global Funding has duly authorized the execution and delivery of
this Funding Note Indenture to provide for the issuance of the funding note
referred to in Section 2.2 below (the "Funding Note");
WHEREAS, all things necessary to make this Funding Note Indenture a valid
and legally binding agreement of Global Funding and the other parties to this
Funding Note Indenture, enforceable in accordance with its terms, have been
done, and Global Funding proposes to do all things necessary to make the Funding
Note, when executed by Global Funding and authenticated and delivered pursuant
hereto, valid and legally binding obligation of Global Funding as hereinafter
provided; and
WHEREAS, the parties hereto desire to incorporate by reference those
certain Standard Funding Note Indenture Terms attached to the Series Instrument
as Exhibit H (the "Standard Funding Note Indenture Terms");
NOW, THEREFORE, for and in consideration of the premises and the purchase
of the Funding Note by the Holder thereof, it is mutually covenanted and agreed
by the parties hereto as follows:
ARTICLE 1
SECTION 1.1 Incorporation by Reference. All terms, provisions and
agreements set forth in the Standard Funding Note Indenture Terms (except to the
extent expressly modified hereby) are hereby incorporated herein by reference
(as if fully set forth herein). Should any portion of the Standard Funding Note
Indenture Terms conflict with the terms of this Funding Note Indenture, the
terms of this Funding Note Indenture shall prevail. References herein to
Articles, Sections or Exhibits shall refer respectively to the articles,
sections or exhibits of the Standard Funding Note Indenture Terms, unless
otherwise expressly provided.
SECTION 1.2 Definitions. "Series Instrument" means the Series Instrument in
which this Funding Note Indenture is included as Part H. All capitalized terms
not otherwise defined in this Funding Note Indenture shall have the meanings set
forth in the Standard Funding Note Indenture Terms.
20
ARTICLE 2
SECTION 2.1 Agreement to Be Bound. Each of Global Funding, the Funding Note
Indenture Trustee, the Funding Note Registrar, the Funding Note Exchange Rate
Agent, the Funding Note Paying Agent and the Funding Note Calculation Agent
hereby agrees to be bound by all of the terms, provisions and agreements set
forth herein, with respect to all matters contemplated herein, including,
without limitation, those relating to the issuance of the Funding Note.
SECTION 2.2 Additional Terms. [None].
SECTION 2.3 Series Instrument; Execution and Incorporation of Terms. The
parties to this Funding Note Indenture will enter into this Funding Note
Indenture by executing this Series Instrument.
By executing the signature page thereto, the Funding Note Indenture Trustee
and Global Funding hereby agree that this Funding Note Indenture will constitute
a legal, valid and binding agreement among the parties hereto.
All terms relating to Global Funding or the Funding Note not otherwise
included in this Funding Note Indenture will be as specified in the Series
Instrument.
SECTION 2.4 Counterparts. This Funding Note Indenture, through the Series
Instrument, may be executed in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which counterparts
shall constitute one and the same instrument.
21
PART I
MISCELLANEOUS AND EXECUTION PAGES
The Series Instrument may be executed by each of the parties hereto in any
number of counterparts, and by each of the parties hereto on separate
counterparts, each of which counterparts, when so executed and delivered, shall
be deemed to be an original, but all such counterparts shall together constitute
but one and the same instrument. Facsimile signatures shall be deemed original
signatures.
Each signatory, by its execution hereof, does hereby become a party to, or
executes, each of the agreements and certificates identified below for such
signatory as of the date specified in such agreements and certificates.
It is expressly understood and agreed by the parties that (a) Wilmington
Trust Company (the "Delaware Trustee") is hereby instructed by Global Funding
and the Trust to execute the Series Instrument on their behalf, (b) the Series
Instrument is executed and delivered by the Delaware Trustee, not individually
or personally, but solely as Delaware Trustee, in the exercise of the powers and
authority conferred and vested in it, pursuant to the Trust Agreement set forth
in Part A of the Series Instrument (the "Trust Agreement"), (c) each of the
representations, undertakings and agreements made on the part of the Trust in
the Series Instrument is made and intended not as personal representations,
undertakings and agreements by the Delaware Trustee but is made and intended for
the purpose of binding only the Trust, (d) nothing contained herein shall be
construed as creating any liability on the Delaware Trustee individually or
personally, to perform any covenant either expressed or implied contained
herein, all such liability, if any, being expressly waived by the parties hereto
and by any person claiming by, through or under the parties hereto, and (e)
under no circumstances shall the Delaware Trustee be personally liable for the
payment of any indebtedness or expenses of the Trust or be liable for any breach
or failure of any obligation, representation, warranty or covenant to be made or
undertaken by the Trust under the Indenture set forth in Part G to the Series
Instrument or any other related documents; provided, however, that such waiver
shall not affect the liability of the Delaware Trustee (or any entity acting as
successor or additional trustee) to any person under any other agreement to the
extent expressly agreed to in its individual capacity under the Trust Agreement.
22
IN WITNESS WHEREOF, the undersigned have executed this Series Instrument.
ALLSTATE INSURANCE COMPANY (for
purposes of the Name Licensing
Agreement set forth in Part D
hereof)
By:
----------------------------
Name:
Title:
ALLSTATE LIFE INSURANCE COMPANY
(for purposes of (i) the Support
Agreement set forth in Part C
hereof and (ii) the Coordination
Agreement set forth in Part F
hereof)
By:
----------------------------
Name:
Title:
ALLSTATE LIFE GLOBAL FUNDING
(for purposes of (i) the Trust
Agreement set forth in Part A
hereof, (ii) the Terms Agreement
set forth in Part E hereof,
(iii) the Coordination Agreement
set forth in Part F hereof and
(iv) the Funding Note Indenture
set forth in Part H hereof)
By: Wilmington Trust Company, solely in its capacity
as Delaware Trustee
By:
----------------------------
Name:
Title:
THE ALLSTATE LIFE GLOBAL FUNDING
TRUST SPECIFIED ABOVE (for
purposes of (i) the
Administrative Services
Agreement set forth in Part B
hereof, (ii) the Support
Agreement set forth in Part C
hereof, (iii) the Name Licensing
Agreement set forth in Part D
hereof, (iv) the Terms Agreement
set forth in Part E hereof, (v)
the Coordination Agreement set
forth in Part F hereof and (vi)
the Indenture set forth in Part
G hereof)
By: Wilmington Trust Company, solely in its capacity
23
as Delaware Trustee
By:
----------------------------
Name:
Title:
WILMINGTON TRUST COMPANY (for purposes of the Trust Agreement
set forth in Part A hereof as Delaware Trustee)
By:
---------------------------
Name:
Title:
J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION
(for purposes of (i) the Coordination Agreement set forth
in Part F hereof, (ii) the Indenture set forth in Part G
hereof and (iii) the Funding Note Indenture set forth in
Part H hereof)
By:
----------------------------
Name:
Title:
J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION
Chicago, Illinois office, as Collateral Custodian (for
purposes of the Coordination Agreement set forth in Part F
hereof)
By:
---------------------------
Name:
Title:
AMACAR PACIFIC CORP. (for purposes of (i) the Trust Agreement set
forth in Part A hereof and (ii) the Administrative Services
Agreement set forth in Part B hereof as Administrator)
24
By:
---------------------------
Name:
Title:
[MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED] (for purposes of the Terms Agreement
set forth in Part E hereof)
By:
----------------------------
Name:
Title:
25
EXHIBIT A
STANDARD TRUST AGREEMENT TERMS
A-1
EXHIBIT B
STANDARD ADMINISTRATIVE SERVICES AGREEMENT TERMS
B-1
EXHIBIT C
STANDARD SUPPORT AND EXPENSES AGREEMENT TERMS
C-1
EXHIBIT D
STANDARD NAME LICENSING AGREEMENT TERMS
D-1
EXHIBIT E
DISTRIBUTION AGREEMENT
E-1
EXHIBIT F
CERTIFICATE OF TRUST
F-1
EXHIBIT G
STANDARD INDENTURE TERMS
G-1
EXHIBIT H
STANDARD FUNDING NOTE INDENTURE TERMS
H-1
ANNEX A
PRICING SUPPLEMENT
A-A-1
ANNEX B
DELAWARE TRUSTEE SERVICE FEE SCHEDULE
A-B-1
ANNEX C
ADMINISTRATOR SERVICE FEE SCHEDULE
A-C-1
ANNEX D
AGENT NOTICE INFORMATION
A-D-1
ANNEX E
INDENTURE SERVICE FEE SCHEDULE
A-E-1
EXHIBIT 4.13
===============================================================================
FORM OF CLOSING INSTRUMENT
===============================================================================
TABLE OF CONTENTS
PAGE
PART A ASSIGNMENT OF FUNDING AGREEMENT(S) TO THE FUNDING NOTE
INDENTURE TRUSTEE.........................................................................1
PART B ACKNOWLEDGEMENT OF ASSIGNMENT OF FUNDING AGREEMENT(S) TO
THE FUNDING NOTE INDENTURE TRUSTEE........................................................3
PART C TERMINATION OF SECURITY INTEREST AND TRANSFER OF FUNDING
AGREEMENT(S) TO ALLSTATE LIFE GLOBAL FUNDING..............................................5
PART D ACKNOWLEDGEMENT OF TERMINATION OF SECURITY INTEREST AND
TRANSFER OF FUNDING AGREEMENT(S)..........................................................7
PART E ASSIGNMENT OF FUNDING AGREEMENT(S) TO THE TRUST...........................................8
PART F ACKNOWLEDGEMENT OF ASSIGNMENT OF FUNDING AGREEMENT(S) TO
THE TRUST.................................................................................9
PART G ASSIGNMENT OF FUNDING AGREEMENT(S) TO THE INDENTURE TRUSTEE..............................10
PART H ACKNOWLEDGEMENT OF ASSIGNMENT OF FUNDING AGREEMENT(S) TO
THE INDENTURE TRUSTEE....................................................................11
PART I CERTIFICATE REGARDING CUSTODY OF FUNDING AGREEMENT(S)....................................13
PART J INSTRUCTIONS TO THE FUNDING NOTE INDENTURE TRUSTEE.......................................14
PART K ACKNOWLEDGEMENT OF FUNDING NOTE INDENTURE TRUSTEE
CONCERNING THE FUNDING NOTE CERTIFICATE..................................................15
PART L CERTIFICATE OF FUNDING NOTE INDENTURE TRUSTEE CONCERNING THE
FUNDING AGREEMENT(S).....................................................................16
PART M INSTRUCTIONS TO THE INDENTURE TRUSTEE....................................................17
PART N ACKNOWLEDGEMENT OF INDENTURE TRUSTEE CONCERNING THE NOTE
CERTIFICATE(S)...........................................................................18
PART O CERTIFICATE OF INDENTURE TRUSTEE CONCERNING THE FUNDING
AGREEMENT(S).............................................................................19
PART P CERTIFICATE OF GLOBAL FUNDING PURSUANT TO SECTION 7(C) OF THE
DISTRIBUTION AGREEMENT...................................................................20
PART Q OFFICER'S CERTIFICATE OF ALLSTATE LIFE INSURANCE COMPANY
PURSUANT TO SECTION 4(C) OF THE REPRESENTATIONS AND INDEMNITY
AGREEMENT................................................................................21
PART R SECRETARY'S CERTIFICATE OF ALLSTATE LIFE INSURANCE COMPANY...............................22
PART S CERTIFICATE OF SERVICER CONCERNING CORPORATE MATTERS.....................................26
PART T CERTIFICATE OF ADMINISTRATOR.............................................................29
PART U CROSS-RECEIPT BETWEEN THE TRUST AND THE AGENT(S).........................................35
PART V CROSS-RECEIPT BETWEEN THE TRUST AND ALLSTATE LIFE GLOBAL
FUNDING..................................................................................36
PART W CROSS-RECEIPT BETWEEN ALLSTATE LIFE GLOBAL FUNDING AND
ALLSTATE LIFE INSURANCE COMPANY..........................................................37
PART X CROSS-RECEIPT BETWEEN ALLSTATE LIFE GLOBAL FUNDING AND THE
i
TRUST....................................................................................38
PART Y MISCELLANEOUS AND EXECUTION PAGES........................................................39
ii
WHEREAS, the parties named herein desire to enter into certain documents
relating to the issuance by Allstate Life Global Funding Trust - (the "Trust")
of Notes to investors under Allstate Life Global Funding's ("Global Funding")
secured medium term notes program;
WHEREAS, in connection with the issuance of Notes, the Trust and certain
other parties have executed and delivered a Series Instrument pursuant to which
the Administrative Services Agreement, the Coordination Agreement, the Funding
Note Indenture, the Indenture, the Name Licensing Agreement, the Support
Agreement, the Terms Agreement and the Trust Agreement are entered into, and
certain other documents are executed (the "Series Instrument");
WHEREAS, certain arrangements relating to the assignment of Funding
Agreement(s) No. - (the "Funding Agreement(s)") issued by Allstate Life
Insurance Company ("Allstate Life") as of the Original Issue Date, by Global
Funding to the Funding Note Indenture Trustee (as defined in the Funding Note
Indenture set forth in Part H of the Series Instrument) are set forth in the
Assignment of Funding Agreement(s) to the Funding Note Indenture Trustee (set
forth in Part A hereof), dated as of the Original Issue Date, among the parties
thereto indicated in Part Y hereof;
WHEREAS, certain arrangements relating to Allstate Life's acknowledgement
of the assignment of the Funding Agreement(s) from Global Funding to the Funding
Note Indenture Trustee are set forth in the Acknowledgement of Funding
Agreement(s) Assignment to the Funding Note Indenture Trustee (set forth in Part
B hereof), dated as of the Original Issue Date, among the parties thereto
indicated in Part Y hereof;
WHEREAS, certain arrangements relating to the transfer of the Funding
Agreement(s) by the Funding Note Indenture Trustee to Global Funding are set
forth in the Transfer of Funding Agreement(s) to Global Funding (set forth in
Part C hereof), dated as of the Original Issue Date, among the parties thereto
indicated in Part Y hereof;
WHEREAS, certain arrangements relating to Allstate Life's acknowledgement
of the transfer of the Funding Agreement(s) from the Funding Note Indenture
Trustee to Global Funding are set forth in the Acknowledgement of Funding
Agreement(s) Transfer to Global Funding (set forth in Part D hereof), dated as
of the Original Issue Date, among the parties thereto indicated in Part Y
hereof;
WHEREAS, certain arrangements relating to the transfer of the Funding
Agreement(s) by Global Funding to the Trust are set forth in the Assignment of
Funding Agreement(s) to the Trust (set forth in Part E hereof), dated as of the
Original Issue Date, among the parties thereto indicated in Part Y hereof;
WHEREAS, certain arrangements relating to Allstate Life's acknowledgement
of the transfer of the Funding Agreement(s) from Global Funding to the Trust are
set forth in the Acknowledgement of Assignment of Funding Agreement(s) to the
Trust (set forth in Part F hereof), dated as of the Original Issue Date, among
the parties thereto indicated in Part Y hereof;
WHEREAS, certain arrangements relating to the assignment of the Funding
Agreement(s) by the Trust to the Indenture Trustee (as defined in Part G of the
Series Instrument) are set forth in the Assignment of Funding Agreement(s) to
the Indenture Trustee (set forth in Part G hereof),
iii
dated as of the Original Issue Date, among the parties thereto indicated in Part
Y hereof;
WHEREAS, certain arrangements relating to Allstate Life's acknowledgement
of the assignment of the Funding Agreement(s) from the Trust to the Indenture
Trustee are set forth in the Acknowledgement of Funding Agreement(s) Assignment
to the Indenture Trustee (set forth in Part H hereof), dated as of the Original
Issue Date, among the parties thereto indicated in Part Y hereof;
WHEREAS, certain certifications concerning custody of the Funding
Agreement(s) are set forth in the Certificate Regarding Custody of the Funding
Agreement(s) (set forth in Part I hereof), dated as of the Original Issue Date;
WHEREAS, certain instructions of Global Funding relating to the
authentication, registration, acceptance and retention of the certificate
representing the Funding Note (the "Funding Note Certificate"), and a standing
order regarding payments to be made in respect of the Funding Note, are set
forth in the Instructions of Global Funding (set forth in Part J hereof), dated
as of the Original Issue Date, between the parties thereto indicated in Part Y
hereof;
WHEREAS, certain arrangements relating to the Funding Note Indenture
Trustee's acknowledgement of the receipt, authentication, acceptance and
retention of the Funding Note Certificate, and a standing order regarding
payments to be made in respect of the Funding Note, are set forth in the
Acknowledgment of Funding Note Indenture Trustee Concerning the Funding Note
Certificate (set forth in Part K hereof), dated as of the Original Issue Date;
WHEREAS, certain arrangements relating to the Funding Note Indenture
Trustee's acknowledgement of the receipt and retention of the Funding
Agreement(s) are set forth in the Certificate of Funding Note Indenture Trustee
Concerning the Funding Agreement(s) (set forth in Part L hereof), dated as of
the Original Issue Date;
WHEREAS, certain instructions of the Trust relating to the authentication,
registration, acceptance and retention of the certificate(s) representing the
Notes, and a standing order regarding payments to be made in respect of the
Notes, are set forth in the Instructions of the Trust (set forth in Part M
hereof), dated as of the Original Issue Date;
WHEREAS, certain arrangements relating to the Indenture Trustee's
acknowledgement of the receipt, authentication, acceptance and retention of the
certificate(s) representing the Notes, and a standing order regarding payments
to be made in respect of the Notes, are set forth in the Acknowledgment of
Indenture Trustee Concerning the Note Certificate(s) (set forth in Part N
hereof), dated as of the Original Issue Date;
WHEREAS, certain arrangements relating to the Indenture Trustee's
acknowledgement of the receipt and retention of the Funding Agreement(s) are set
forth in the Certificate of Indenture Trustee Concerning the Funding
Agreement(s) (set forth in Part O hereof), dated as of the Original Issue Date;
WHEREAS, certain certifications of Global Funding pursuant to the
Distribution Agreement are set forth in the Certificate of Global Funding
Pursuant to Section 7(c) of the Distribution Agreement (set forth in Part P
hereof), dated as of the Original Issue Date;
iv
WHEREAS, certain certifications of Allstate Life pursuant to the
Representations and Indemnity Agreement are set forth in the Officer's
Certificate of Allstate Life Insurance Company Pursuant to Section 4(c) of the
Representations and Indemnity Agreement (set forth in Part Q hereof), dated as
of the Original Issue Date;
WHEREAS, certain certifications of the Secretary of Allstate Life are set
forth in the Secretary's Certificate of Allstate Life Insurance Company (set
forth in Part R hereof), dated as of the Original Issue Date;
WHEREAS, certain certifications of the Indenture Trustee concerning
corporate matters are set forth in the Certificate of Indenture Trustee
Concerning Corporate Matters (set forth in Part S hereof), dated as of the
Original Issue Date;
WHEREAS, certain certifications of the Administrator (as defined in Part B
of the Series Instrument) are set forth in the Certificate of Administrator (set
forth in Part T hereof), dated as of the Original Issue Date;
WHEREAS, the acknowledgments of the cross-receipt between the Trust and the
Agent(s) are set forth in the Cross-Receipt between the Trust and the Agent(s)
(set forth in Part U hereof), dated as of the Original Issue Date;
WHEREAS, the acknowledgments of the cross-receipt between the Trust and
Global Funding are set forth in the Cross-Receipt between the Trust and Global
Funding (set forth in Part V hereof), dated as of the Original Issue Date;
WHEREAS, the acknowledgments of the cross-receipt between Global Funding
and Allstate Life are set forth in the Cross-Receipt between Global Funding and
Allstate Life (set forth in Part W hereof), dated as of the Original Issue Date;
and
WHEREAS, the acknowledgments of the cross-receipt between Global Funding
and the Trust are set forth in the Cross-Receipt between Global Funding and the
Trust (set forth in Part X hereof), dated as of the Original Issue Date.
All capitalized terms used in the above recitals and not otherwise defined
will have the meanings set forth in the Indenture set forth in Part G of the
Series Instrument.
v
PART A
ASSIGNMENT OF FUNDING AGREEMENT(S)
TO THE FUNDING NOTE INDENTURE TRUSTEE
With respect to the Funding Note Indenture set forth in Part H of the
Series Instrument (as defined in the second recital to the Closing Instrument)
(the "Funding Note Indenture") among Allstate Life Global Funding ("Global
Funding") and the other parties specified therein and in furtherance of the
grant to the Funding Note Indenture Trustee (as defined in the Funding Note
Indenture) of the Security Interest (as defined in the Funding Note Indenture)
for the benefit of each Secured Party (as defined in the Funding Note
Indenture), subject to its right to assign the Funding Agreement(s) (as defined
in the third recital to the Closing Instrument) to the Allstate Life Global
Funding Trust specified in the Closing Instrument (the "Trust") in accordance
with the terms of the Funding Note and the Coordination Agreement (as defined
below), Global Funding hereby assigns, as of the Original Issue Date specified
in the Pricing Supplement attached to the Series Instrument as Annex A, to the
Funding Note Indenture Trustee all of its rights and interests of every nature
as the Owner (as defined in the Funding Agreement(s)) under the Funding
Agreement(s). Global Funding hereby notifies Allstate Life Insurance Company
("Allstate Life") of the assignment of the Funding Agreement(s) to the Funding
Note Indenture Trustee effected hereby and requests that Allstate Life consent
to such assignment, and Allstate Life hereby gives consent to such assignment.
Each of Global Funding, the Funding Note Indenture Trustee and Allstate
Life hereby agrees that, upon giving effect to the assignment described above
(the "Assignment"), the Funding Note Indenture Trustee shall be a party to and
the "Owner" under each Funding Agreement and shall be the assignee of the rights
and interests of Global Funding under each Funding Agreement.
The Funding Note Indenture Trustee hereby represents and covenants that the
Funding Agreement(s) will be held, on its behalf, by the Collateral Custodian
(as defined in Part F of the Series Instrument) in Chicago, Illinois.
Each of Global Funding, the Funding Note Indenture Trustee and Allstate
Life hereby agrees that the Assignment shall not be effective until the
conditions precedent to assignment set forth in Section 5 of the Funding
Agreement(s) (other than the giving by Allstate Life of its consent to this
Assignment) have been complied with by Global Funding, the Funding Note
Indenture Trustee and Allstate Life, as the case may be. Each of Global Funding
and the Funding Note Indenture Trustee hereby undertakes to take all actions
necessary to comply with such conditions, and Allstate Life hereby affirms that
it will promptly change its books and records to reflect the Assignment upon
receipt of documents required under the Funding Agreement(s).
Each of Global Funding, the Funding Note Indenture Trustee and Allstate
Life agrees that in connection with the assignment of the Funding Agreement(s)
by Global Funding to the Trust, and the surrender and cancellation of the
Funding Note, in accordance with the terms of the Funding Note and the
Coordination Agreement (as defined below) the Assignment will terminate and all
rights and interests of the Funding Note Indenture Trustee as a party to and the
"Owner" of each Funding Agreement and as the assignee of the rights and
interests of Global Funding
1
under each Funding Agreement will be immediately transferred by the Funding Note
Indenture Trustee, and revert, to Global Funding.
The Assignment and this letter shall be governed by, and shall be construed
and enforced in accordance with, the laws of the State of New York, without
regard to conflicts of laws principles, and shall be binding upon, and shall
inure to the benefit of, the parties hereto and their respective successors and
assigns.
"Closing Instrument" means the Closing Instrument in which this Assignment
of Funding Agreement(s) to the Funding Note Indenture Trustee is included as
Part A.
All capitalized terms not otherwise defined herein shall have the meanings
set forth in the Coordination Agreement set forth in Part F of the Series
Instrument (the "Coordination Agreement").
2
PART B
ACKNOWLEDGEMENT OF ASSIGNMENT OF FUNDING AGREEMENT(S)
TO THE FUNDING NOTE INDENTURE TRUSTEE
With respect to the Assignment of Funding Agreement(s) to the Funding Note
Indenture Trustee, set forth in Part A of the Closing Instrument (the
"Assignment"), executed by Allstate Life Global Funding (the "Funding Agreement
Buyer") and the Funding Note Indenture Trustee (as defined in the Funding Note
Indenture set forth in Part H of the Series Instrument (as defined in the second
recital to the Closing Instrument) for the Allstate Life Global Funding Trust
specified in the Closing Instrument (the "Trust") (such Funding Note Indenture,
the "Funding Note Indenture"), and acknowledged by Allstate Life Insurance
Company ("Allstate Life") regarding the assignment of the Funding Agreement(s)
(as defined in the third recital to the Closing Instrument), dated as of the
Original Issue Date identified in the Pricing Supplement attached as Annex A to
the Series Instrument for the Trust, and in order to induce the Trust to
purchase the Funding Note, and the Funding Note Indenture Trustee to accept the
Funding Agreement(s) as security for Global Funding's obligations under the
Funding Note, Allstate Life hereby (a) represents and warrants to the Funding
Agreement Buyer and the Funding Note Indenture Trustee that (i) it has changed
its books and records to reflect the Assignment as required by Section 5 of each
Funding Agreement, (ii) all other conditions precedent to the Assignment set
forth in Section 5 of each Funding Agreement have been satisfied and (iii) no
person or entity other than the Funding Agreement Buyer or the Funding Note
Indenture Trustee has been, and no person or entity other than the Funding Note
Indenture Trustee is, shown on Allstate Life's books and records as the owner of
or as having any interest in the Funding Agreement(s), (b) covenants and agrees
with the Funding Agreement Buyer and the Funding Note Indenture Trustee that it
will not hereafter (i) consent to the transfer or assignment of the Funding
Agreement(s) to any person or entity other than the Funding Agreement Buyer or
the Funding Note Indenture Trustee or (ii) change its books or records to show
any person or entity other than the Funding Note Indenture Trustee or the
Funding Agreement Buyer, as the owner of or as having any interest in the
Funding Agreement(s), except in each case pursuant to written instructions from
the Funding Agreement Buyer and the Funding Note Indenture Trustee or their
respective successors or as otherwise provided pursuant to the terms of the
Funding Note and the Coordination Agreement (as defined below) and (c) covenants
and agrees with the Funding Agreement Buyer and the Funding Note Indenture
Trustee to (i) consent to any request by the Funding Note Indenture Trustee to
transfer or assign the Funding Agreement(s) to any person or entity, (ii) change
its books or records to reflect any such transfer or assignment and (iii) take
such other action as may be required on its part to cause the conditions
precedent for such a transfer or assignment contained in Section 5 of the
Funding Agreement(s) to be satisfied with respect to such transfer or
assignment.
Allstate Life hereby also represents that Allstate Life did not receive any
notice of any adverse claim prior to (a) its acknowledgment and consent to the
Assignment or (b) taking the actions under Section 5 of the Funding Agreement(s)
to effect the Assignment.
This letter agreement shall be governed by, and shall be construed and
enforced in accordance with, the laws of the State of New York, without regard
to conflicts of laws principles, and shall be binding upon, and shall inure to
the benefit of, the parties hereto and their
3
respective successors and assigns.
"Closing Instrument" means the Closing Instrument in which this
Acknowledgement of Assignment of Funding Agreement(s) to the Funding Note
Indenture Trustee is included as Part B.
All capitalized terms not otherwise defined herein shall have the meanings
set forth in the Coordination Agreement set forth in Part F of the Series
Instrument (the "Coordination Agreement").
4
PART C
TERMINATION OF SECURITY INTEREST AND
TRANSFER OF FUNDING AGREEMENT(S) TO ALLSTATE LIFE GLOBAL FUNDING
In connection with the assignment of the Funding Agreement(s) (as defined
in the third recital to the Closing Instrument) by Allstate Life Global Funding
("Global Funding") to the Allstate Life Global Funding Trust specified in the
Closing Instrument (the "Trust"), and the surrender and cancellation of the
Funding Note, in accordance with the terms of the Funding Note and the
Coordination Agreement (as defined below), Global Funding hereby certifies, and
each of Global Funding and the Funding Note Indenture Trustee (as defined in the
Funding Note Indenture set forth in Part H of the Series Instrument (as defined
in the second recital to the Closing Instrument) for the Trust (the "Funding
Note Indenture") agrees, that the Security Interest (as defined in the Funding
Note Indenture) in the Collateral (as defined in the Funding Note Indenture) in
favor of the Funding Note Indenture Trustee has terminated and all rights to the
Collateral have reverted to Global Funding. The Funding Note Indenture Trustee
hereby transfers, as of the Original Issue Date specified in the Pricing
Supplement attached to the Series Instrument for the Trust as Annex A, to Global
Funding all of its rights and interests of every nature as the Owner (as defined
in the Funding Agreement(s)) under the Funding Agreement(s). Global Funding and
the Funding Note Indenture Trustee hereby notify Allstate Life Insurance Company
("Allstate Life") of the termination of the Security Interest and the transfer
of the Funding Agreement(s) to Global Funding effected hereby (the "Transfer")
and request that Allstate Life consent to the Transfer, and Allstate Life hereby
gives consents to the Transfer.
Each of the Funding Note Indenture Trustee, Global Funding and Allstate
Life hereby agrees that, upon giving effect to the Transfer, Global Funding
shall be a party to and the "Owner" under the Funding Agreement(s) and shall be
the transferee of the rights and interests of the Funding Note Indenture Trustee
under the Funding Agreement(s).
Global Funding hereby represents and covenants that the Funding
Agreement(s) will be held, on its behalf, by the Collateral Custodian in
Chicago, Illinois.
Each of the Funding Note Indenture Trustee, Global Funding and Allstate
Life hereby agrees that the Transfer shall not be effective until the conditions
precedent to transfer set forth in Section 5 of the Funding Agreement(s) (other
than the giving by Allstate Life of its consent to this Transfer) have been
complied with by the Funding Note Indenture Trustee, Global Funding and Allstate
Life, as the case may be. Each of the Funding Note Indenture Trustee and Global
Funding hereby undertakes to take all actions necessary to comply with such
conditions, and Allstate Life hereby affirms that it will promptly change its
books and records to reflect the Transfer upon receipt of documents required
under the Funding Agreement(s).
The Transfer and this letter shall be governed by, and shall be construed
and enforced in accordance with, the laws of the State of New York, without
regard to conflicts of laws principles, and shall be binding upon, and shall
inure to the benefit of, the parties hereto and their respective successors and
assigns.
"Closing Instrument" means the Closing Instrument in which this Termination
of
5
Security Interest and Transfer of Funding Agreement(s) to Allstate Life Global
Funding is included as Part C.
All capitalized terms not otherwise defined herein shall have the meanings
set forth in the Coordination Agreement set forth in Part F of the Series
Instrument (the "Coordination Agreement").
6
PART D
ACKNOWLEDGEMENT OF TERMINATION OF SECURITY INTEREST
AND TRANSFER OF FUNDING AGREEMENT(S)
With respect to the Termination of Security Interest and Transfer of
Funding Agreement(s) to Allstate Life Global Funding ("Global Funding"), set
forth in Part C of the Closing Instrument (the "Transfer"), executed by the
Funding Note Indenture Trustee (as defined in the Funding Note Indenture set
forth in Part H of the Series Instrument (as defined in the second recital to
the Closing Instrument) for the Trust (the "Funding Note Indenture") and Global
Funding, and acknowledged by Allstate Life Insurance Company ("Allstate Life")
regarding the termination of the Security Interest (as defined in the Funding
Note Indenture in the Collateral (as defined in the Funding Note Indenture) in
favor of the Funding Note Indenture Trustee and the transfer by the Funding Note
Indenture Trustee to Global Funding of the Funding Agreement(s) (as defined in
the third recital to the Closing Instrument) dated as of the Original Issue Date
identified in the Pricing Supplement attached as Annex A to the Series
Instrument, Allstate Life hereby represents and warrants to the Funding Note
Indenture Trustee and Global Funding that (a) it has changed its books and
records to reflect the Transfer as required by Section 5 of the Funding
Agreement(s), (b) all other conditions precedent to the Transfer set forth in
Section 5 of the Funding Agreement(s) have been satisfied and (c) no person or
entity other than Global Funding or the Funding Note Indenture Trustee has been,
and no person or entity other than Global Funding is, shown on Allstate Life's
books and records as the owner of or as having any interest in the Funding
Agreement(s).
Allstate Life hereby also represents that Allstate Life did not receive any
notice of any adverse claim prior to (a) its acknowledgment and consent to the
Transfer or (b) taking the actions under Section 5 of the Funding Agreement(s)
to effect the Transfer.
This letter agreement shall be governed by, and shall be construed and
enforced in accordance with, the laws of the State of New York, without regard
to conflicts of laws principles, and shall be binding upon, and shall inure to
the benefit of, the parties hereto and their respective successors and assigns.
"Closing Instrument" means the Closing Instrument in which this
Acknowledgement of Termination of Security Interest and Transfer of Funding
Agreement(s) is included as Part D.
All capitalized terms not otherwise defined herein shall have the meanings
set forth in the Coordination Agreement set forth in Part F of the Series
Instrument.
7
PART E
ASSIGNMENT OF FUNDING AGREEMENT(S) TO THE TRUST
With respect to (a) the Coordination Agreement among the Allstate Life
Global Funding Trust specified in the Closing Instrument (the "Trust") and the
other parties specified therein, set forth in Part F of the Series Instrument
(as defined in the second recital to the Closing Instrument) for the Trust (the
"Coordination Agreement") and (b) the Terms Agreement set forth in Part E of the
Series Instrument, Allstate Life Global Funding ("Global Funding") hereby
assigns absolutely to, and deposits into, the Trust, as of the Original Issue
Date specified in the Pricing Supplement attached to the Series Instrument as
Annex A, all of its rights and interests of every nature as the Owner (as
defined in the Funding Agreement(s)) under the Funding Agreement(s) (as defined
in the third recital to the Closing Instrument). Global Funding hereby notifies
Allstate Life Insurance Company ("Allstate Life") of the assignment of the
Funding Agreement(s) to the Trust effected hereby and requests that Allstate
Life consent to such assignment, and Allstate Life hereby gives consent to such
assignment.
Each of Global Funding, the Trust and Allstate Life hereby agrees that,
upon giving effect to the assignment described above (the "Assignment"), the
Trust shall be a party to and the "Owner" under the Funding Agreement(s) and
shall be the assignee of the rights and interests of Global Funding under the
Funding Agreement(s).
The Trust hereby represents and covenants that the Funding Agreement(s)
will be held, on its behalf, by the Collateral Custodian in Chicago, Illinois.
Each of Global Funding, the Trust and Allstate Life hereby agrees that the
Assignment shall not be effective until the conditions precedent to transfer set
forth in Section 5 of the Funding Agreement(s) (other than the giving by
Allstate Life of its consent to this Assignment) have been complied with by
Global Funding, the Trust and Allstate Life, as the case may be. Each of Global
Funding and the Trust hereby undertakes to take all actions necessary to comply
with such conditions, and Allstate Life hereby affirms that it will promptly
change its books and records to reflect the Assignment upon receipt of documents
required under the Funding Agreement(s).
The Assignment and this letter shall be governed by, and shall be
construed and enforced in accordance with, the laws of the State of New York,
without regard to conflicts of laws principles, and shall be binding upon, and
shall inure to the benefit of, the parties hereto and their respective
successors and assigns.
"Closing Instrument" means the Closing Instrument in which this Assignment
of Funding Agreement(s) to the Trust is included as Part E.
All capitalized terms not otherwise defined herein shall have the meanings
set forth in the Coordination Agreement.
8
PART F
ACKNOWLEDGEMENT OF ASSIGNMENT OF FUNDING AGREEMENT(S)
TO THE TRUST
With respect to the Assignment of Funding Agreement(s) to the Trust, set
forth in Part E of the Closing Instrument (the "Assignment"), executed by
Allstate Life Global Funding ("Global Funding") and the Allstate Life Global
Funding Trust specified in the Closing Instrument (the "Funding Agreement
Buyer"), and acknowledged by Allstate Life Insurance Company ("Allstate Life")
regarding the assignment of the Funding Agreement(s) (as defined in the third
recital to the Closing Instrument), dated as of the Original Issue Date
identified in the Pricing Supplement attached as Annex A to the Series
Instrument (as defined in the second recital to the Closing Instrument) for the
Trust, and in order to induce the Funding Agreement Buyer to purchase the
Funding Agreement(s), Allstate Life hereby (a) represents and warrants to Global
Funding and the Funding Agreement Buyer that (i) it has changed its books and
records to reflect the Assignment as required by Section 5 of each Funding
Agreement, (ii) all other conditions precedent to the Assignment set forth in
Section 5 of the Funding Agreement(s) have been satisfied and (iii) no person or
entity other than the Funding Agreement Buyer or Global Funding has been, and no
person or entity other than the Funding Agreement Buyer is, shown on Allstate
Life's books and records as the owner of or as having any interest in the
Funding Agreement(s) and (b) covenants and agrees with Global Funding and the
Funding Agreement Buyer that it will not hereafter (i) consent to the transfer
or assignment of the Funding Agreement(s) to any person or entity other than the
Funding Agreement Buyer and the Indenture Trustee or (ii) change its books or
records to show any person or entity other than the Indenture Trustee as the
owner of or as having any interest in the Funding Agreement(s), except in each
case pursuant to written instructions from the Funding Agreement Buyer and the
Indenture Trustee or its successors.
Allstate Life hereby also represents that Allstate Life did not receive any
notice of any adverse claim prior to (a) its acknowledgment and consent to the
Assignment or (b) taking the actions under Section 5 of the Funding Agreement(s)
to effect the Assignment.
This letter agreement shall be governed by, and shall be construed and
enforced in accordance with, the laws of the State of New York, without regard
to conflicts of laws principles, and shall be binding upon, and shall inure to
the benefit of, the parties hereto and their respective successors and assigns.
"Closing Instrument" means the Closing Instrument in which this
Acknowledgement of Assignment of Funding Agreement(s) to the Trust is included
as Part F.
All capitalized terms not otherwise defined herein shall have the meanings
set forth in the Coordination Agreement set forth in Part F of the Series
Instrument.
9
PART G
ASSIGNMENT OF FUNDING AGREEMENT(S)
TO THE INDENTURE TRUSTEE
With respect to (a) the Indenture set forth in Part G of the Series
Instrument (as defined in the second recital to the Closing Instrument) for the
Allstate Life Global Funding Trust specified in the Closing Instrument (the
"Trust", and, such Indenture, the "Indenture") and (b) the Terms Agreement set
forth in Part E of the Series Instrument, and in furtherance of the grant to the
Indenture Trustee of the Security Interest (as defined in the Indenture) for the
benefit of each Secured Party (as defined in the Indenture), the Trust hereby
assigns, as of the Original Issue Date specified in the Pricing Supplement
attached to the Series Instrument for the Trust as Annex A, to the Indenture
Trustee all of its rights and interests of every nature as the Owner (as defined
in the Funding Agreement(s)) under the Funding Agreement(s) (as defined in the
third recital to the Closing Instrument). The Trust hereby notifies Allstate
Life Insurance Company ("Allstate Life") of the assignment of the Funding
Agreement(s) to the Indenture Trustee effected hereby and requests that Allstate
Life consent to such assignment, and Allstate Life hereby gives consent to such
assignment.
Each of the Trust, the Indenture Trustee and Allstate Life hereby agrees
that, upon giving effect to the assignment described above (the "Assignment"),
the Indenture Trustee shall be a party to and the "Owner" under the Funding
Agreement(s) and shall be the assignee of the rights and interests of the Trust
under the Funding Agreement(s).
The Indenture Trustee hereby represents and covenants that the Funding
Agreement(s) will be held, on its behalf, by the Collateral Custodian in
Chicago, Illinois.
Each of the Trust, the Indenture Trustee and Allstate Life hereby agrees
that the Assignment shall not be effective until the conditions precedent to
assignment set forth in Section 5 of the Funding Agreement(s) (other than the
giving by Allstate Life of its consent to this Assignment) have been complied
with by the Trust, the Indenture Trustee and Allstate Life, as the case may be.
Each of the Trust and the Indenture Trustee hereby undertakes to take all
actions necessary to comply with such conditions, and Allstate Life hereby
affirms that it will promptly change its books and records to reflect the
Assignment upon receipt of documents required under the Funding Agreement(s).
The Assignment and this letter shall be governed by, and shall be construed
and enforced in accordance with, the laws of the State of New York, without
regard to conflicts of laws principles, and shall be binding upon, and shall
inure to the benefit of, the parties hereto and their respective successors and
assigns.
"Closing Instrument" means the Closing Instrument in which this Assignment
of Funding Agreement(s) to the Indenture Trustee is included as Part G.
All capitalized terms not otherwise defined herein shall have the meanings
set forth in the Coordination Agreement set forth in Part F of the Series
Instrument.
10
PART H
ACKNOWLEDGEMENT OF ASSIGNMENT OF FUNDING AGREEMENT(S)
TO THE INDENTURE TRUSTEE
With respect to the Assignment of Funding Agreement(s) to the Indenture
Trustee, set forth in Part G of the Closing Instrument (the "Assignment"),
executed by the Allstate Life Global Funding Trust specified in the Closing
Instrument (the "Trust" or the "Funding Agreement Buyer") and the Indenture
Trustee, and acknowledged by Allstate Life Insurance Company ("Allstate Life"),
regarding the assignment of the Funding Agreement(s) (as defined in the third
recital to the Closing Instrument), dated as of the Original Issue Date
identified in the Pricing Supplement attached as Annex A to the Series
Instrument (as defined in the second recital to the Closing Instrument) for the
Trust, and in order to induce the Funding Agreement Buyer to purchase the
Funding Agreement(s), and the Indenture Trustee to accept the Funding
Agreement(s) as security for the Funding Agreement Buyer's obligations under the
Notes, Allstate Life hereby (a) represents and warrants to the Funding Agreement
Buyer and the Indenture Trustee that (i) it has changed its books and records to
reflect the Assignment as required by Section 5 of the Funding Agreement(s),
(ii) all other conditions precedent to the Assignment set forth in Section 5 of
the Funding Agreement(s) have been satisfied and (iii) no person or entity other
than the Funding Agreement Buyer, Allstate Life Global Funding, the Funding Note
Indenture Trustee or the Indenture Trustee has been, and no person or entity
other than the Indenture Trustee is, shown on Allstate Life's books and records
as the owner of or as having any interest in the Funding Agreement(s), (b)
covenants and agrees with the Funding Agreement Buyer and the Indenture Trustee
that it will not hereafter (i) consent to the transfer or assignment of the
Funding Agreement(s) to any person or entity other than the Funding Agreement
Buyer and the Indenture Trustee or (ii) change its books or records to show any
person or entity other than the Indenture Trustee as the owner of or as having
any interest in the Funding Agreement(s), except in each case pursuant to
written instructions from the Funding Agreement Buyer and the Indenture Trustee
or its successors and (c) covenants and agrees with the Funding Agreement Buyer
and the Indenture Trustee to (i) consent to any request by the Indenture Trustee
to transfer or assign the Funding Agreement(s) to any person or entity, (ii)
change its books or records to reflect any such transfer or assignment and (iii)
take such other action as may be required on its part to cause the conditions
precedent for such a transfer or assignment contained in Section 5 of the
Funding Agreement(s) to be satisfied with respect to such transfer or
assignment.
Allstate Life hereby also represents that Allstate Life did not receive any
notice of any adverse claim prior to (a) its acknowledgment and consent to the
Assignment or (b) taking the actions under Section 5 of the Funding Agreement(s)
to effect the Assignment.
This letter agreement shall be governed by, and shall be construed and
enforced in accordance with, the laws of the State of New York, without regard
to conflicts of laws principles, and shall be binding upon, and shall inure to
the benefit of, the parties hereto and their respective successors and assigns.
"Closing Instrument" means the Closing Instrument in which this
Acknowledgement of Assignment of Funding Agreement(s) to the Indenture Trustee
is included as Part H.
11
All capitalized terms not otherwise defined herein shall have the meanings
set forth in the Coordination Agreement set forth in Part F of the Series
Instrument.
12
PART I
CERTIFICATE REGARDING CUSTODY OF FUNDING AGREEMENT(S)
Reference is hereby made to (i) the Indenture set forth in Part G of the
Series Instrument (as defined in the second recital to the Closing Instrument)
for the Allstate Life Global Funding Trust specified in the Closing Instrument
(the "Trust"); (ii) the Funding Note Indenture set forth in Part H of the Series
Instrument; and (iii) the Coordination Agreement set forth in Part F of the
Series Instrument (the "Coordination Agreement"). "Closing Instrument" means the
Closing Instrument in which this Certificate Regarding Custody of Funding
Agreement(s) is included as Part I. Capitalized terms used in this Certificate
and not otherwise defined have the meanings ascribed in the Coordination
Agreement.
In connection with: (i) the sale of the Funding Agreement(s) (as defined in
the third recital to the Closing Instrument), issued by Allstate Life Insurance
Company ("Allstate Life") to Allstate Life Global Funding ("Global Funding")
pursuant to Article 2 of the Coordination Agreement; (ii) the Assignment of
Funding Agreement(s) to the Funding Note Indenture Trustee set forth in Part A
of the Closing Instrument; (iii) the Assignment of Funding Agreement(s) to the
Trust set forth in Part E of the Closing Instrument; and (iv) the Assignment of
Funding Agreement(s) to the Indenture Trustee set forth in Part G of the Closing
Instrument, the Collateral Custodian hereby represents that:
(1) it is holding the instruments that constitute or evidence each
Funding Agreement in its custody: (i) from and after the issuance of such
Funding Agreement and prior to the creation of the Security Interest (as
defined in the Funding Note Indenture, the "Funding Note Security
Interest") pursuant to the terms of the Funding Note Indenture, on behalf
of Global Funding; (ii) from and after the creation of the Funding Note
Security Interest and prior to the termination of the Funding Note Security
Interest, solely on behalf of the Funding Note Indenture Trustee; (iii)
from and after the termination of the Funding Note Security Interest and
prior to the creation of the Security Interest (as defined in the
Indenture, the "Indenture Security Interest") pursuant to the terms of the
Indenture, solely on behalf of the Trust; and (iv) from and after the
creation of the Indenture Security Interest, solely on behalf of the
Indenture Trustee;
(2) the instruments that constitute or evidence each Funding Agreement
are in its possession at: -, or such other address in Chicago, Illinois
specified from time to time in writing by the Collateral Custodian to each
other party to the Coordination Agreement; and
(3) it has no claim against Global Funding or the Trust with respect
to the Funding Agreement(s) and, to the best of its knowledge, all liens,
if any, on the Funding Agreement(s) in favor of Global Funding or the Trust
have been satisfied.
13
PART J
INSTRUCTIONS OF THE FUNDING NOTE INDENTURE TRUSTEE
Reference is hereby made to the Funding Note Indenture set forth in Part H
of the Series Instrument (as defined in the second recital to the Closing
Instrument) among Allstate Life Global Funding ("Global Funding") and the other
parties specified therein (the "Funding Note Indenture"). "Closing Instrument"
means the Closing Instrument in which these Instructions to the Funding Note
Indenture Trustee are included as Part J. All capitalized terms not otherwise
defined herein shall have the meanings set forth in the Funding Note Indenture.
Global Funding herewith delivers to the Funding Note Indenture Trustee, or
has caused to be delivered to the Funding Note Indenture Trustee, pursuant to
the Funding Note Indenture, the Funding note Certificate representing the
Funding Note (referred to in the Pricing Supplement) attached as Annex A to the
Series Instrument (the "Pricing Supplement"), having an initial Principal Amount
identified in the Pricing Supplement, and the Standing Order (as defined below)
regarding payments to be made in respect of the Funding Note.
Global Funding hereby instructs the Funding Note Indenture Trustee to: (i)
authenticate the Funding Note Certificate; (ii) register the Funding Note
represented by the Funding Note Certificate in the name of the Allstate Life
Global Funding Trust specified in the Closing Instrument (the "Trust"); (iii)
accept the deposit of the Funding Note Certificate and hold in a safe custody
the Funding Note Certificate as custodian for the Trust; and (iv) take all such
other reasonable action as may be required to give effect to the foregoing.
Pursuant to Section 3.1(d) of the Amended and Restated Trust Agreement,
dated as of -, 2006 (the "Trust Agreement") among Wilmington Trust Company, as
Delaware Trustee (the "Delaware Trustee"), AMACAR Pacific Corp., as
Administrator, and AMACAR Pacific Corp., as Trust Beneficial Owner, the Delaware
Trustee, on behalf of Global Funding, hereby issues the Standing Order (as
defined in the Trust Agreement) to the Funding Note Indenture Trustee to, either
directly or through a Funding Note Paying Agent, distribute all amounts due and
unpaid under Section 3.1(b) of the Trust Agreement; provided, however, that all
payments to be made pursuant to Section 7.1 of the Trust Agreement shall be made
by the Delaware Trustee on behalf of Global Funding.
14
PART K
ACKNOWLEDGEMENT OF FUNDING NOTE INDENTURE TRUSTEE CONCERNING THE FUNDING NOTE
CERTIFICATE
J.P. Morgan Trust Company, National Association, in its capacities as
Funding Note Paying Agent, Funding Note Registrar and Funding Note Indenture
Trustee, certifies, as of the Original Issue Date identified in the Pricing
Supplement attached as Annex A to the Series Instrument (as defined in the
second recital to the Closing Instrument) for the Trust (the "Pricing
Supplement"), the following:
1. it has received the Funding Note Certificate and the Standing Order
set forth in Part J of the Closing Instrument regarding payments to be made
in respect of the Funding Note; and
2. (a) it has duly authenticated the Funding Note Certificate; (b)
registered the Funding Note represented by the Funding Note Certificate in
the name of the Trust; (c) it has accepted the deposit and will hold in
safe custody the Funding Note Certificate as custodian for the Trust; and
(d) it will take all such other reasonable action as may be required to
give effect to the foregoing; and
3. it will at all times comply with the Standing Order set forth in
Part J of the Closing Instrument.
"Closing Instrument" means the Closing Instrument in which this
Acknowledgement of Funding Note Indenture Trustee Concerning the Funding Note
Certificate is included as Part K.
All capitalized terms not otherwise defined herein shall have the meanings
ascribed in Part J of the Closing Instrument.
15
PART L
CERTIFICATE OF FUNDING NOTE INDENTURE TRUSTEE CONCERNING THE
FUNDING AGREEMENT(S)
Reference is hereby made to the Funding Note Indenture set forth in Part H
of the Series Instrument (as defined in the second recital to the Closing
Instrument) among Allstate Life Global Funding ("Global Funding") and the other
parties specified therein (the "Funding Note Indenture"). "Closing Instrument"
means the Closing Instrument in which this Certificate of Funding Note Indenture
Trustee Concerning the Funding Agreement(s) is included as Part L. All
capitalized terms not otherwise defined herein shall have the meanings set forth
in the Funding Note Indenture.
In connection with (i) the Funding Agreement(s) (as defined in the third
recital to the Closing Instrument) and (ii) the Assignment of Funding
Agreement(s) to the Funding Note Indenture Trustee set forth in Part A of the
Closing Instrument, the Funding Note Indenture Trustee hereby represents that
the Collateral Custodian (as defined in Part F of the Series Instrument) has
received delivery on behalf of the Funding Note Indenture Trustee of the Funding
Agreement(s) and the Collateral Custodian is holding such Funding Agreement(s)
on behalf of the Funding Note Indenture Trustee for the benefit and security of
the holders of the Funding Note specified in the Pricing Supplement attached as
Annex A to the Series Instrument and that each Funding Agreement(s) is in the
custody of the Collateral Custodian, on behalf of the Funding Note Indenture
Trustee, at the address specified in or pursuant to the Certificate Regarding
Custody of the Funding Agreement(s) set forth in Part I of the Closing
Instrument.
16
PART M
INSTRUCTIONS TO THE INDENTURE TRUSTEE
Reference is hereby made to the Indenture set forth in Part G of the Series
Instrument (as defined in the second recital to the Closing Instrument) for the
Allstate Life Global Funding Trust specified in the Closing Instrument (the
"Trust"), among the Trust and the other parties specified therein (the
"Indenture"). "Closing Instrument" means the Closing Instrument in which these
Instructions to the Indenture Trustee are included as Part M. All capitalized
terms not otherwise defined herein shall have the meanings set forth in the
Indenture.
The Trust herewith delivers to the Indenture Trustee, or has caused to be
delivered to the Indenture Trustee, pursuant to the Indenture, each Note
Certificate representing the Notes (each, a "Note Certificate"), bearing the
CUSIP No. identified in the Pricing Supplement attached as Annex A to the Series
Instrument (the "Pricing Supplement"), having an initial Principal Amount
identified in the Pricing Supplement, and the Standing Order (as defined below)
regarding payments to be made in respect of the Notes.
The Trust hereby instructs the Indenture Trustee to (i) authenticate each
Note Certificate, (ii) register the Notes represented by each Note Certificate
in the name of the Depositary identified on the Pricing Supplement (the
"Depositary") or its nominee, (iii) accept the deposit of each Note Certificate
and hold in safe custody each Note Certificate as custodian or common depositary
for the Depositary, and (iv) take all such other reasonable action as may be
required to give effect to the foregoing.
The Trust hereby further directs the Indenture Trustee to deposit the Net
Proceeds to the Trust (as identified in the Pricing Supplement) in respect of
the Notes to:
- Bank, Chicago
Illinois ABA # -
Credit: -
Account # -: Allstate Life Global Funding
Contract # -
or such other account as may be specified to the Indenture Trustee by or on
behalf of the Trust.
Pursuant to Section 3.1(d) of the Standard Trust Terms (the "Standard Trust
Terms") incorporated into the Trust Agreement set forth in Part A of the Series
Instrument (the "Trust Agreement"), the Delaware Trustee (as defined in the
Trust Agreement), on behalf of the Trust, hereby issues the Standing Order (as
defined in the Trust Agreement) to the Indenture Trustee to, either directly or
through a Paying Agent, distribute all amounts due and unpaid under Section
3.1(b) of the Standard Trust Terms; provided, however, that all payments to be
made pursuant to Section 7.1 of the Standard Trust Terms shall be made by the
Delaware Trustee on behalf of the Trust.
17
PART N
ACKNOWLEDGEMENT OF INDENTURE TRUSTEE
CONCERNING THE NOTE CERTIFICATE(S)
J.P. Morgan Trust Company, National Association, in its capacities as
Paying Agent, Registrar and Indenture Trustee, certifies, as of the Original
Issue Date identified in the Pricing Supplement attached as Annex A to the
Series Instrument (as defined in the second recital to the Closing Instrument)
for the Trust (the "Pricing Supplement"), the following:
1. it has received each Note Certificate and the Standing Order set
forth in Part M of the Closing Instrument regarding payments to be made in
respect of the Notes;
2. (a) it has duly authenticated each Note Certificate; (b) if
applicable, registered the Notes represented by each Note Certificate in
the name of the Depositary or its nominee; (c) it has accepted the deposit
and will hold in safe custody each Note Certificate as custodian or common
depositary for the Depositary; and (d) it will take all such other
reasonable action as may be required to give effect to the foregoing; and
3. it will at all times comply with the Standing Order set forth in
Part M of the Closing Instrument.
In connection with the above issue, it also hereby confirms that, by order
of the Agent(s) identified in the Pricing Supplement, it has made the following
irrevocable payment instruction:
Payment Date: Original Issue Date identified in the Pricing Supplement
Amount: Net Proceeds to the Trust identified in the Pricing Supplement
Payment to: Account specified in Part M of the Closing Instrument
All capitalized terms not otherwise defined herein shall have the meanings
ascribed in Part M of the Closing Instrument.
18
PART O
CERTIFICATE OF INDENTURE TRUSTEE CONCERNING
THE FUNDING AGREEMENT(S)
Reference is hereby made to the Indenture set forth in Part G of the Series
Instrument (as defined in the second recital to the Closing Instrument) for the
Trust for the Allstate Life Global Funding Trust specified in the Closing
Instrument (the "Trust"), among the Trust and the other parties specified
therein (the "Indenture"). "Closing Instrument" means the Closing Instrument in
which this Certificate of Indenture Trustee Concerning the Funding Agreement(s)
is included as Part O. Capitalized terms used in this Certificate and not
otherwise defined have the meanings ascribed in the Indenture.
In connection with (i) the Funding Agreement(s) (as defined in the third
recital to the Closing Instrument) and (ii) the Assignment of Funding
Agreement(s) to the Indenture Trustee set forth in Part G of the Closing
Instrument, the Indenture Trustee hereby represents that the Collateral
Custodian (as defined in Part F of the Series Instrument) has received delivery
on behalf of the Indenture Trustee of the Funding Agreement(s) and the
Collateral Custodian is holding such Funding Agreement(s) on behalf of the
Indenture Trustee for the benefit and security of the holders of the Notes
specified in the Pricing Supplement attached as Annex A to the Series Instrument
for the Trust and that the Funding Agreement(s) is/are in the custody of the
Collateral Custodian, on behalf of the Indenture Trustee at the address
specified in or pursuant to the Certificate Regarding Custody of the Funding
Agreement(s) set forth in Part I of the Closing Instrument.
19
PART P
CERTIFICATE
OF GLOBAL FUNDING
PURSUANT TO SECTION 7(c)
OF THE DISTRIBUTION AGREEMENT
Allstate Life Global Funding, a statutory trust organized under the laws of
the State of Delaware ("Global Funding"), does hereby certify to each Agent
identified in the Pricing Supplement attached as Annex A to the Series
Instrument (as defined in the second recital to the Closing Instrument) for the
Allstate Life Global Funding Trust specified in the Closing Instrument (the
"Trust") pursuant to Section 7(c) of the Distribution Agreement attached as
Exhibit E to the Series Instrument (the "Distribution Agreement") that, as of
the Original Issue Date (as specified in the Pricing Supplement attached to the
Series Instrument as Annex A, the "Original Issue Date"):
1. the representations and warranties of Global Funding and, if
applicable, the Trust in the Distribution Agreement are true and correct on
and as of the Original Issue Date and Global Funding and, if applicable,
the Trust have complied with all agreements and satisfied all the
conditions on its part to be performed or satisfied at or prior to the
Original Issue Date;
2. no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or, to Global Funding's knowledge, threatened; and
3. except as otherwise provided in the Terms Agreement set forth in
Part E of the Series Instrument, since the date of the Base Prospectus
there has occurred no event required to be set forth in an amendment or
supplement to the Registration Statement or Base Prospectus which has not
been filed, and there has been no document required to be filed under the
1933 Act, the 1933 Act Regulations, the 1934 Act or the 1934 Act
Regulations which, upon filing, would be deemed to be incorporated by
reference in the Prospectus which has not been so filed.
"Closing Instrument" means the Closing Instrument in which this Certificate
of Global Funding Pursuant to Section 7(c) of the Distribution Agreement is
included as Part P.
All capitalized terms not otherwise defined herein shall have the meanings
set forth in the Distribution Agreement.
20
PART Q
OFFICER'S CERTIFICATE
OF ALLSTATE LIFE INSURANCE COMPANY
PURSUANT TO SECTION 4(C)
OF THE REPRESENTATIONS AND INDEMNITY AGREEMENT
The signatory identified in Part Y of the Closing Instrument (the
"Officer"), a duly elected officer of Allstate Life Insurance Company, an
Illinois insurance company ("Allstate Life"), does hereby certify to each Agent
identified in the Pricing Supplement attached as Annex A to the Series
Instrument (as defined in the second recital to the Closing Instrument) for the
Allstate Life Global Funding Trust specified in the Closing Instrument (the
"Trust"), in such capacity and on behalf of Allstate Life, pursuant to Section
4(c) of the Representations and Indemnity Agreement, dated as of -, 2006, among
Allstate Life and the Agents specified therein (as amended, modified, restated,
supplemented and/or replaced from time to time, the "Representations and
Indemnity Agreement") that, to the knowledge of the Officer based upon
reasonable investigation, as of the Original Issue Date specified in the Pricing
Supplement attached to the Series Instrument as Annex A:
1. no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or, to Allstate Life's knowledge, threatened;
2. since the date of the Base Prospectus there has occurred no event
required to be set forth in an amendment or supplement to the Registration
Statement or Base Prospectus which has not been filed, and there has been
no document required to be filed under the 1933 Act, the 1933 Act
Regulations, the 1934 Act or the 1934 Act Regulations which, upon filing,
would be deemed to be incorporated by reference in the Prospectus which has
not been so filed; and
3. nothing has come to the attention of Allstate Life that would cause
it to believe that the priority status of the Funding Agreement(s) under
Section 5/205 of the Illinois Insurance Code has been adversely modified
since the date of the last delivery of the opinion issued by Lord, Bissell
& Brook LLP, substantially in the form of Exhibit C to the Distribution
Agreement.
"Closing Instrument" means the Closing Instrument in which this Officer's
Certificate of Allstate Life Insurance Company Pursuant to Section 4(c) of the
Representations and Indemnity Agreement is included as Part Q.
All capitalized terms not otherwise defined herein shall have the meanings
set forth in the Distribution Agreement.
21
PART R
SECRETARY'S CERTIFICATE OF
ALLSTATE LIFE INSURANCE COMPANY
The signatory identified in Part Y of the Closing Instrument, the duly
elected Secretary of Allstate Life Insurance Company, an Illinois insurance
company ("Allstate Life"), does hereby certify as of the Original Issue Date (as
specified in the Pricing Supplement attached to the Series Instrument (as
defined in the second recital to the Closing Instrument) for the Trust as Annex
A, the "Original Issue Date") that:
1. Attached hereto as Annex A is a true, complete and correct copy of
the Articles of Amendment to the Articles of Incorporation of Allstate Life
as amended to date and as in full force and effect on the Original Issue
Date; since-, no action has been taken by Allstate Life or any officers,
directors or shareholders of Allstate Life to effect or authorize any
amendment thereto;
2. Attached hereto as Annex B is a true, complete and correct copy of
the By-Laws of Allstate Life as amended to the Original Issue Date and as
in full force and effect on the Original Issue Date;
3. Attached hereto as Annex C is a true, complete and correct copy of
the resolutions of the Board of Directors of Allstate Life duly adopted on
- and such resolutions have not been amended, modified, annulled or
revoked, and are in full force and effect on the Original Issue Date; and
4. Each of the following individuals have been duly elected or
appointed to the position of Allstate Life shown opposite each of their
names along with a true specimen of each of their respective signatures:
Name Title Signature
- ----------------------- --------------------------- -------------------------
-------------------------
-------------------------
"Closing Instrument" means the Closing Instrument in which this Secretary's
Certificate of Allstate Life Insurance Company is included as Part R.
22
ANNEX A TO PART R
23
ANNEX B TO PART R
24
ANNEX C TO PART R
25
PART S
CERTIFICATE OF SERVICER CONCERNING CORPORATE MATTERS
Reference is made to: (i) the Indenture set forth in Part G of the Series
Instrument (as defined in the second recital to the Closing Instrument) for the
Allstate Life Global Funding Trust specified in the Closing Instrument (the
"Trust") among the Trust and the other parties specified therein, entered into
in connection with the issuance of the secured medium term notes of the Trust
(the "Notes"); (ii) the Funding Note Indenture set forth in Part H of the Series
Instrument, among Allstate Life Global Funding and the other parties specified
therein, entered into in connection with the issuance of the Funding Note
specified in the Pricing Supplement attached to the Series Instrument as Annex A
(the "Funding Note"); and (iii) the Coordination Agreement set forth in Part F
of the Series Instrument (the "Coordination Agreement") among the Trust and the
other parties specified therein. "Closing Instrument" means the Closing
Instrument in which this Certificate of Servicer Concerning Corporate Matters is
included as Part S. All capitalized terms not otherwise defined herein shall
have the meanings set forth in the Indenture.
J.P. Morgan Trust Company, National Association, in its capacity as: (i)
the Indenture Trustee, Registrar, Exchange Rate Agent, Paying Agent and
Calculation Agent; and (ii) the Funding Note Indenture Trustee, Funding Note
Registrar, Funding Note Exchange Rate Agent, Funding Note Paying Agent and
Funding Calculation Agent (as such terms are defined in the Funding Note
Indenture) (in such capacities, the "Servicer"), hereby certifies that:
1. Each of (i) the Indenture; (ii) the Funding Note Indenture; (iii)
the Coordination Agreement; (iv) the Assignment of Funding Agreement(s) to
the Funding Note Indenture Trustee set forth in Part A of the Closing
Instrument; (v) the Acknowledgement of Assignment of Funding Agreement(s)
to the Funding Note Indenture Trustee set forth in Part B of the Closing
Instrument; (vi) the Termination of Security Interest and Transfer of
Funding Agreement(s) to Global Funding set forth in Part C of the Closing
Instrument; (vii) the Acknowledgement of Termination of Security Interest
and Transfer of Funding Agreement(s) set forth in Part D of the Closing
Instrument; (viii) the Assignment of Funding Agreement(s) to the Indenture
Trustee set forth in Part G of the Closing Instrument; (ix) the
Acknowledgement of Assignment of Funding Agreement(s) to the Indenture
Trustee set forth in Part H of the Closing Instrument; (x) the Instructions
of Global Funding set forth in Part J of the Closing Instrument; (xi) the
Acknowledgement of Funding Note Indenture Trustee Concerning the Funding
Note Certificate set forth in Part K of the Closing instrument; (xii) the
Certificate of Funding Note Indenture Trustee Concerning the Funding
Agreement(s) set forth in Part L of the Closing Instrument (xiii) the
Instructions of the Trust set forth in Part M of the Closing Instrument;
(xiv) the Acknowledgement of Indenture Trustee Concerning the Note
Certificate(s) set forth in Part N of the Closing Instrument; and (xv) the
Certificate of Indenture Trustee Concerning the Funding Agreement(s) set
forth in Part O of the Closing Instrument (collectively, the "Transaction
Documents") has been duly executed and delivered on behalf of the Servicer
by an authorized officer of the Servicer.
26
2. Each person who, as an officer of the Servicer, signed any
Transaction Document, was duly elected or appointed, qualified and acting
as such officer at the respective time of the signing and delivery thereof
and was duly authorized to sign such Transaction Document on behalf of the
Servicer, and the signature of each such person is the genuine signature of
such officer.
3. Each person who, as an officer of the Servicer, in its capacity as
Indenture Trustee under the Indenture, authenticated certificates
representing the Notes issued under the Indenture was at the time of such
authentication and is now a duly elected or appointed officer of the
Servicer, in its capacity as Indenture Trustee under the Indenture,
authorized and empowered so to act and the signature of each such person
appearing on any such certificate is genuine. The Servicer, in its capacity
as Indenture Trustee under the Indenture, has examined the form of Notes
certificate so authenticated and delivered and has found the same to be in
substantially the form called for by the Indenture.
4. Each person who, as an officer of the Servicer, in its capacity as
Funding Note Indenture Trustee under the Funding Note Indenture,
authenticated certificates representing the Funding Note issued under the
Funding Note Indenture was at the time of such authentication and is now a
duly elected or appointed officer of the Servicer, in its capacity as
Funding Note Indenture Trustee under the Funding Note Indenture, authorized
and empowered so to act and the signature of each such person appearing on
any such certificate is genuine. The Servicer, in its capacity as Funding
Note Indenture Trustee under the Funding Note Indenture, has examined the
form of Funding Note certificate so authenticated and delivered and has
found the same to be in substantially the form called for by the Funding
Note Indenture.
5. Attached hereto as Exhibit A is a true, correct and complete copy
of an extract of the bylaws of the Servicer evidencing the authority of
certain officers of the Servicer to sign indentures and other documents and
instruments, and authenticate certificates representing securities, which
bylaws are in effect at the Original Issue Date specified in the Pricing
Supplement attached to the Series Instrument for the Trust as Annex A and
at all times since December 3, 2001.
6. The Indenture Trustee is eligible to act as Indenture Trustee under
the applicable provisions of the Indenture.
7. The Funding Note Indenture Trustee is eligible to act as Funding
Note Indenture Trustee under the applicable provisions of the Funding Note
Indenture.
"Closing Instrument" means the Closing Instrument in which this Certificate
of Servicer Concerning Corporate Matters is included as Part S.
27
EXHIBIT A TO PART S
EXTRACT FROM BY-LAWS
28
PART T
CERTIFICATE OF ADMINISTRATOR
The signatory identified in Part Y of the Closing Instrument, the duly
appointed Secretary of AMACAR Pacific Corp., a Delaware corporation (the
"Administrator"), does hereby certify as of the Original Issue Date identified
in the Pricing Supplement attached as Annex A to the Series Instrument (as
defined in the second recital to the Closing Instrument) for the Trust (the
"Original Issue Date") that:
1. Each of the persons named on Exhibit A hereto has been duly elected
or appointed and is duly qualified as an officer of the Administrator on
the Original Issue Date, holding the office or offices set forth opposite
his or her name, and the signature set forth opposite his or her name is a
specimen of his or her genuine signature.
2. Attached hereto as Exhibit B is a true and correct copy of the
Certificate of Incorporation of the Administrator as in effect on the
Original Issue Date.
3. Attached hereto as Exhibit C is a true and correct copy of the
By-Laws of the Administrator as in effect on the Original Issue Date.
4. Attached hereto as Exhibit D is a true and correct copy of a
resolution duly adopted by the Board of Directors of the Administrator at a
meeting thereof duly called and held on -, at which a quorum was present
and acting throughout. Such resolution has not been amended, modified,
rescinded or revoked and is in full force and effect on the Original Issue
Date.
5. Attached hereto as Exhibit E is a true and correct copy of a
resolution duly adopted by the Board of Directors of the Administrator at a
meeting thereof duly called and held on -, at which a quorum was present
and acting throughout. Such resolution has not been amended, modified,
rescinded or revoked and is in full force and effect on the Original Issue
Date.
6. The Administrator is a corporation existing and in good standing
under the laws of the State of Delaware.
7. There is no proceeding pending or, to the best of my knowledge,
threatened for the dissolution or liquidation of the Administrator.
"Closing Instrument" means the Closing Instrument in which this Certificate
of Administrator is included as Part T.
All capitalized terms not otherwise defined herein shall have the meanings
set forth in the Administrative Services Agreement set forth in Part B to the
Series Instrument.
29
EXHIBIT A TO PART T
Name Office Signature
- ----------------------- ------------------ --------------------------
--------------------------
--------------------------
30
EXHIBIT B TO PART T
31
EXHIBIT C TO PART T
32
EXHIBIT D TO PART T
33
EXHIBIT E TO PART T
34
PART U
CROSS-RECEIPT BETWEEN THE
TRUST AND THE AGENT(S)
Reference is hereby made to the Terms Agreement set forth in Part E of the
Series Instrument (as defined in the second recital to the Closing Instrument)
for the Allstate Life Global Funding Trust specified in the Closing Instrument
(the "Trust", and such Terms Agreement, the "Terms Agreement"). "Closing
Instrument" means the Closing Instrument in which this Cross Receipt Between the
Trust and the Agent(s) is included as Part U. All capitalized terms not
otherwise defined herein shall have the meanings set forth in the Terms
Agreement.
1. The Trust hereby acknowledges receipt from the Agent(s) of
immediately available funds in the amount equal to the Net Proceeds to the
Trust identified in the Pricing Supplement attached as Annex A to the
Series Instrument, representing payment in full of the Notes sold to the
Agent(s) pursuant to the Terms Agreement.
2. The Agent(s) hereby acknowledge(s) receipt from the Trust of the
Notes sold to the Agent(s) by the Trust pursuant to the Terms Agreement.
35
PART V
CROSS-RECEIPT BETWEEN THE TRUST
AND ALLSTATE LIFE GLOBAL FUNDING
Reference is hereby made to the Coordination Agreement set forth in Part F
of the Series Instrument (as defined in the second recital to the Closing
Instrument) for the Allstate Life Global Funding Trust specified in the Closing
Instrument (the "Trust", and such Coordination Agreement, the "Coordination
Agreement"). "Closing Instrument" means the Closing Instrument in which this
Cross-Receipt Between the Trust and Allstate Life Global Funding is included as
Part V. All capitalized terms not otherwise defined herein shall have the
meanings set forth in the Coordination Agreement.
1. Allstate Life Global Funding ("Global Funding") hereby acknowledges
receipt from the Trust of immediately available funds in the amount equal
to the Net Proceeds to the Trust identified in the Pricing Supplement
attached as Annex A to the Series Instrument, representing payment in full
of the Funding Note sold to the Trust pursuant to the Coordination
Agreement.
2. The Trust hereby acknowledges receipt from Global Funding of the
Funding Note sold to the Trust pursuant to the Coordination Agreement.
36
PART W
CROSS-RECEIPT BETWEEN
ALLSTATE LIFE GLOBAL FUNDING AND
ALLSTATE LIFE INSURANCE COMPANY
Reference is hereby made to the Coordination Agreement set forth in Part F
of the Series Instrument (as defined in the second recital to the Closing
Instrument) for the Allstate Life Global Funding Trust specified in the Closing
Instrument (the "Trust", and such Coordination Agreement, the "Coordination
Agreement"). "Closing Instrument" means the Closing Instrument in which this
Cross-Receipt Between Allstate Life Global Funding and Allstate Life Insurance
Company is included as Part W. All capitalized terms not otherwise defined
herein shall have the meanings set forth in the Coordination Agreement.
1. Allstate Life Insurance Company ("Allstate Life") hereby
acknowledges receipt from Allstate Life Global Funding ("Global Funding")
of immediately available funds in the amount equal to the Net Proceeds to
the Trust identified in the Pricing Supplement attached as Annex A to the
Series Instrument, representing payment in full of the Funding Agreement(s)
sold to Global Funding pursuant to the Coordination Agreement.
2. Global Funding hereby acknowledges receipt from Allstate Life of
the Funding Agreement(s) sold to Global Funding pursuant to the
Coordination Agreement.
37
PART X
CROSS-RECEIPT BETWEEN
ALLSTATE LIFE GLOBAL FUNDING AND
THE TRUST
Reference is hereby made to the Coordination Agreement set forth in Part F
of the Series Instrument (as defined in the second recital to the Closing
Instrument) for the Allstate Life Global Funding Trust specified in the Closing
Instrument (the "Trust", and such Coordination Agreement, the "Coordination
Agreement"). "Closing Instrument" means the Closing Instrument in which this
Cross-Receipt Between Allstate Life Global Funding and the Trust is included as
Part X. All capitalized terms not otherwise defined herein shall have the
meanings set forth in the Coordination Agreement.
1. The Trust hereby acknowledges receipt from Allstate Life Global
Funding ("Global Funding") of the Funding Agreement(s).
2. Global Funding hereby acknowledges the Trust's surrender of the
Funding Note.
38
PART Y
MISCELLANEOUS AND EXECUTION PAGES
This Closing Instrument may be executed by each of the parties hereto in
any number of counterparts, and by each of the parties hereto on separate
counterparts, each of which counterparts, when so executed and delivered, shall
be deemed to be an original, but all such counterparts shall together constitute
but one and the same instrument. Facsimile signatures shall be deemed original
signatures.
Each signatory, by its execution hereof, does hereby become a party to, or
executes, each of the agreements and certificates identified below for such
signatory as of the date specified in such agreements and certificates.
It is expressly understood and agreed by the parties that (a) Wilmington
Trust Company (the "Delaware Trustee") is hereby instructed by Global Funding
and the Trust to execute the Closing Instrument on their behalf, (b) the Closing
Instrument is executed and delivered by the Delaware Trustee, not individually
or personally, but solely as Delaware Trustee, in the exercise of the powers and
authority conferred and vested in it, pursuant to the Trust Agreement set forth
in Part A to the Series Instrument (as defined in the second recital to the
Closing Instrument) for the Trust (the "Trust Agreement"), (c) each of the
representations, undertakings and agreements made on the part of the Trust in
the Closing Instrument is made and intended not as personal representations,
undertakings and agreements by the Delaware Trustee but is made and intended for
the purpose of binding only the Trust, (d) nothing contained herein shall be
construed as creating any liability on the Delaware Trustee individually or
personally, to perform any covenant either expressed or implied contained
herein, all such liability, if any, being expressly waived by the parties hereto
and by any person claiming by, through or under the parties hereto, and (e)
under no circumstances shall the Delaware Trustee be personally liable for the
payment of any indebtedness or expenses of the Trust or be liable for any breach
or failure of any obligation, representation, warranty or covenant to be made or
undertaken by the Trust under the Indenture set forth in Part G to the Series
Instrument or any other related documents; provided, however, that such waiver
shall not affect the liability of the Delaware Trustee (or any entity acting as
successor or additional trustee) to any person under any other agreement to the
extent expressly agreed to in its individual capacity under the Trust Agreement.
39
IN WITNESS WHEREOF, the undersigned have executed the Closing
Instrument.
ALLSTATE LIFE INSURANCE COMPANY (for
purposes of (i) the Assignment of
Funding Agreement(s) to the Funding
Note Indenture Trustee set forth in
Part A hereof, (ii) the
Acknowledgement of Assignment of
Funding Agreement(s) to the Funding
Note Indenture Trustee set forth in
Part B hereof, (iii) the Termination
of Security Interest and Transfer of
Funding Agreement(s) to Allstate Life Global Funding
set forth in Part C hereof, (iv) the
Acknowledgement of Termination of
Security Interest and Transfer of
Funding Agreement(s) set forth in Part
D hereof, (v) the Assignment of
Funding Agreement(s) to the Trust set
forth in Part E hereof, (vi) the
Acknowledgement of Assignment of
Funding Agreement(s) to the Trust set
forth in Part F hereof, (vii) the
Assignment of Funding Agreement(s) to
the Indenture Trustee set forth in
Part G hereof, (viii) the
Acknowledgement of Assignment of
Funding Agreement(s) to the Indenture
Trustee set forth in Part H hereof and
(ix) the Cross-Receipt Between Allstate Life Global
Funding and Allstate Life Insurance Company set forth in
Part W hereof)
By:
--------------------------------------------------------------------
Name:
Title:
SECRETARY OF ALLSTATE LIFE INSURANCE COMPANY (for purposes of the
Secretary's Certificate of Allstate Life Insurance Company set forth in
Part R hereof)
By:
--------------------------------------------------------------------
Name:
Title: Secretary
I, an authorized officer of Allstate
Life Insurance Company, do hereby
certify that the above signature is
the true and genuine signature of the
duly elected, qualified and acting
Secretary of Allstate Life Insurance
Company.
By:
--------------------------------------------------------------------
Name:
Title:
40
AUTHORIZED OFFICER OF ALLSTATE LIFE INSURANCE COMPANY (for purposes of
the Officer's Certificate of Allstate Life Insurance Company Pursuant to
Section 4(c) of the Representations and Indemnity Agreement set forth in
Part Q hereof)
By:
--------------------------------------------------------------------
Name:
Title:
ALLSTATE LIFE GLOBAL FUNDING (for
purposes of (i) the Assignment of
Funding Agreement(s) to the Funding
Note Indenture Trustee set forth in
Part A hereof, (ii) the
Acknowledgement of Assignment of
Funding Agreement(s) to the Funding
Note Indenture Trustee set forth in
Part B hereof, (iii) the Termination
of Security Interest and Transfer of
Funding Agreement(s) to Allstate Life Global Funding
set forth in Part C hereof, (iv) the
Acknowledgement of Termination of
Security Interest and Transfer of
Funding Agreement(s) set forth in Part
D hereof, (v) the Assignment of
Funding Agreement(s) to the Trust set
forth in Part E hereof, (vi) the
Acknowledgement of Assignment of
Funding Agreement(s) to the
Trust set forth in Part F hereof,
(vii) the Instructions to the
Funding Note Indenture Trustee set forth in Part J hereof,
(viii) the Certificate of Global
Funding Pursuant to Section 7(c) of
the Distribution Agreement set forth
in Part P hereof, (ix) the
Cross-Receipt Between the Trust and
Allstate Life Global Funding set forth in Part V
hereof, (x) the Cross-Receipt Between
Allstate Life Global Funding and Allstate Life Insurance Company set
forth in Part W hereof and (xi) the
Cross-Receipt Between Global Funding
and the Trust set forth in Part X
hereof)
By: Wilmington Trust Company,
solely in its capacity as Delaware
Trustee
By:
--------------------------------------------------------------------
Name:
Title:
41
THE ALLSTATE LIFE GLOBAL FUNDING TRUST
SPECIFIED ABOVE (for purposes of (i)
the Assignment of Funding Agreement(s)
to the Trust set forth in Part E
hereof, (ii) the Acknowledgement of
Assignment of Funding Agreement(s) to
the Trust set forth in Part F hereof,
(iii) the Assignment of Funding
Agreement(s) to the Indenture Trustee
set forth in Part G hereof, (iv) the
Acknowledgement of Assignment of
Funding Agreement(s) to the
Indenture Trustee set forth in Part H
hereof, (v) the Instructions to the
Indenture Trustee set forth in Part M hereof, (vi)
Cross-Receipt Between the Trust and
the Agent(s) set forth in Part U
hereof, (vii) the Cross-Receipt
Between the Trust and Allstate Life Global Funding
set forth in Part V hereof and (viii)
the Cross-Receipt Between Allstate Life Global
Funding and the Trust set forth in
Part X hereof)
By: Wilmington Trust Company, solely in its capacity as
Delaware Trustee
By:
--------------------------------------------------------------------
Name:
Title:
J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION (for
purposes of (i) the Assignment of Funding Agreement(s) to the
Funding Note Indenture Trustee set forth in Part A hereof,
(ii) the Acknowledgement of Assignment of Funding
Agreement(s) to the Funding Note Indenture Trustee set forth in
Part B hereof, (iii) the Termination of Security Interest and Transfer of
Funding Agreement(s) to Allstate Life Global Funding set forth in Part C hereof,
(iv) the Acknowledgement of Termination of Security Interest and Transfer
of Funding Agreement(s) set forth in Part D hereof,(v) the Assignment of
Funding Agreement(s) to the Indenture Trustee set forth in Part G hereof,
(vi) the Acknowledgement of Assignment of Funding Agreement(s) to the
Indenture Trustee set forth in Part H hereof, (vi) the Instructions to the
Funding Note Indenture Trustee set forth in Part J hereof, (vii) the Acknowledgement of
Funding Note Indenture Trustee Concerning the Funding Note Certificate
set forth in Part K hereof, (viii) the Certificate of Funding Note
Indenture Trustee Concerning the Funding Agreement(s) set forth in Part L
hereof, (ix) the Instructions to the Indenture Trustee set forth in Part M hereof,
(x) the Acknowledgement of Indenture Trustee Concerning the Note
Certificates set forth in Part N hereof, (xi) the Certificate of Indenture
Trustee Concerning the Funding Agreement(s) set forth in Part O hereof
and (xii) the Certificate of Servicer
42
Concerning Corporate Matters set forth in Part S hereof)
By:
--------------------------------------------------------------------
Name:
Title:
J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION,
Chicago, Illinois office (for purposes of the Certificate
Regarding Custody of Funding Agreement(s) set forth in Part I
hereof)
By:
--------------------------------------------------------------------
Name:
Title:
WILMINGTON TRUST COMPANY, solely in its capacity as the Delaware Trustee of Global
Funding (for purposes of the Instructions to the Funding Note Indenture Trustee set
forth in Part J hereof)
By:
---------------------------------------------------------------------
Name:
Title:
WILMINGTON TRUST COMPANY, solely in its capacity as the Delaware Trustee of the Trust
(for purposes of the Instructions to the Indenture Trustee set forth in
Part M hereof)
By:
---------------------------------------------------------------------
Name:
Title:
SECRETARY OF AMACAR PACIFIC CORP. (for purposes of the Certificate of
Administrator set forth in Part T hereof)
By:
--------------------------------------------------------------------
Name:
Title: Secretary
I, an authorized officer of AMACAR PACIFIC CORP., do hereby certify that
the above signature is the true and genuine signature of the duly
elected, qualified and acting Secretary of AMACAR PACIFIC CORP.
By:
--------------------------------------------------------------------
Name:
Title:
43
[MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED] (for purposes of the
Cross-Receipt Between the Trust and
the Agent(s) set forth in Part U
hereof)
By:
--------------------------------------------------------------------
Name:
Title:
44
Exhibit 5.1
[Allstate Life Letterhead]
February 27, 2006
Allstate Life Insurance Company
3100 Sanders Road
Northbrook, Illinois 60062
Re: Allstate Life Insurance Company
Funding Agreements
Ladies and Gentlemen:
In connection with the preparation and filing with the Securities and
Exchange Commission (the "Commission") under the Securities Act of 1933, as
amended (the "Act"), by Allstate Life Insurance Company, an Illinois life
insurance company (the "Company"), and Allstate Life Global Funding, a statutory
trust organized under the laws of the State of Delaware ("Global Funding"), of a
Registration Statement on Form S-3 (File No. 333-129157) originally filed with
the Commission on October 20, 2005, as amended by Amendment No. 1 filed with the
Commission on November 29, 2005 and Amendment No. 2 filed with the Commission on
February 27, 2006 (including the documents incorporated by reference therein,
the "Registration Statement"), including a prospectus (the "Prospectus")
relating to secured medium term notes (the "Notes") to be issued by newly
created separate and distinct Delaware statutory trusts (each, a "Trust" and
together the "Trusts"), a prospectus supplement relating to secured medium term
notes to be issued by the Trusts (the "Institutional Prospectus Supplement") and
a prospectus supplement relating to Allstate Life(R) CoreNotes(R) to be issued
by the Trusts (the "Retail Prospectus Supplement"), you have requested my
opinion with respect to the matters set forth below.
The Registration Statement provides for: (i) the registration of up to
$5,000,000,000, or the equivalent amount in one or more foreign currencies,
aggregate principal amount of Notes to be issued by the Trusts, with each Trust
to issue Notes, pursuant to an Indenture (each an "Indenture") to be entered
into among such Trust and the other parties specified therein, including J.P.
Morgan Trust Company, National Association or another entity specified in the
Indenture, as indenture trustee (the "Indenture Trustee"), substantially in the
form attached as an exhibit to the Registration Statement; (ii) the registration
of up to $5,000,000,000, or the equivalent amount in one or more foreign
currencies, aggregate principal amount of Funding Notes to be issued by Global
Funding (each in the form attached as an exhibit to the Registration Statement,
a "Funding Note") to be sold to the Trusts in connection with the sale of the
Notes and (iii) the registration of up to $5,000,000,000, or the equivalent
amount in one or more foreign currencies, of the Company's funding agreements
(each in the form attached as an exhibit to the Registration Statement, a
"Funding Agreement") to be sold to Global Funding, which will immediately grant
a security interest in, pledge and collaterally assign the relevant Funding
Agreement(s) to the Funding Note Indenture Trustee (as defined in the Standard
Funding Note Indenture Terms attached as an exhibit to the Registration
Statement) and will immediately thereafter assign absolutely to and deposit into
the relevant Trust the relevant Funding Agreement(s), and the relevant Funding
Note will be surrendered and cancelled by Global Funding upon such surrender, in
connection with the sale of Notes.
In my capacity as General Counsel to the Company, I, or other attorneys
in the Law Department of the Company under my direction, have examined the
Registration Statement.
In addition, I, or other attorneys in the Law Department of the Company
under my direction, have examined the originals (or copies certified or
otherwise identified to my satisfaction) of such other agreements, certificates,
documents and records and have reviewed such questions of law and made such
inquiries as I have deemed necessary or appropriate for the purpose of the
opinions rendered herein.
In such examination, I have assumed, without inquiry, the legal
capacity of all natural persons, the genuineness of all signatures on all
documents examined by me, the authenticity of all documents submitted to me as
originals, the conformity to the original documents of all such documents
submitted to me as copies and the authenticity of the originals of such latter
documents. As to any facts material to my opinion, I have, when relevant facts
were not independently established, relied upon the aforesaid agreements,
instruments, certificates, documents and records and upon statements and
certificates of officers and representative of the Company and public officials.
Based upon the foregoing, and subject to the limitations,
qualifications and assumptions stated here, I am of the opinion that:
The Funding Agreements have been duly authorized and when they have
been duly executed, issued and delivered, will constitute a valid and legally
binding obligation of the Company in accordance with their terms.
The opinions rendered herein are limited to the laws of the State of
Illinois and the Federal law of the United States.
I consent to the filing of this opinion letter as an exhibit to the
Registration Statement and to the use of my name under the heading "Legal
Opinions" in the Prospectus forming a part thereof and to the incorporation by
reference of this opinion and consent as exhibits to any Registration Statement
field in accordance with Rule 462(b) under the Act relating to the Notes. In
giving such consent, I do not thereby concede that I am within the category of
persons whose consent is required under Section 7 of the Act or the rules and
regulations of the Commission thereunder.
Very truly yours,
/s/ Michael J. Velotta
-----------------------
Michael J. Velotta
EXHIBIT 5.2
[Letterhead of Leboeuf, Lamb, Green & MacRae LLP]
February 27, 2006
Allstate Life Insurance Company
3100 Sanders Road
Northbrook, Illinois 60062
Allstate Life Global Funding
c/o AMACAR Pacific Corp.
6525 Morrison Boulevard, Suite 318
Charlotte, North Carolina 28211
Re: ALLSTATE LIFE INSURANCE COMPANY
ALLSTATE LIFE GLOBAL FUNDING
$5,000,000,000 SECURED MEDIUM TERM NOTES
REGISTRATION STATEMENT ON FORM S-3
Ladies and Gentlemen:
We have acted as special counsel to Allstate Life Insurance Company, a
stock life insurance company organized under the laws of the State of Illinois
("Allstate Life"), and Allstate Life Global Funding, a statutory trust organized
under the laws of the State of Delaware ("Global Funding"), in connection with
the preparation and filing with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Securities
Act"), by Allstate Life and Global Funding, of a Registration Statement on Form
S-3 (File No. 333-129157) on October 20, 2005, as amended by Amendment No. 1
filed with the Commission on November 29, 2005 and Amendment No. 2 filed with
the Commission on February 27, 2006 (including the documents incorporated by
reference therein, the "Registration Statement"), including: (i) a prospectus
(the "Prospectus") relating to secured medium term notes (the "Notes") to be
issued from time to time by newly established separate and distinct Delaware
statutory trusts (each, a "Trust" and together, the "Trusts"); (ii) a prospectus
supplement to the Prospectus relating to Notes to be issued from time to time by
the Trusts under the Secured Medium Term Note program described therein
primarily to institutional investors (the "Institutional Prospectus
Supplement"); and (iii) a prospectus supplement to the Prospectus relating to
Notes to be issued from time to time by the Trusts under the Allstate Life(R)
CoreNotes(R) program described therein primarily to retail investors (the
"Retail Prospectus Supplement").
The Registration Statement provides for: (i) the registration and issuance
of up to $5,000,000,000, or the equivalent amount in one or more foreign
currencies, aggregate principal amount of Notes to be issued by the Trusts, with
each Trust to issue Notes, pursuant to an Indenture (each an "Indenture") to be
entered into among such Trust and J.P. Morgan Trust Company, National
Association, or another entity specified therein, as indenture trustee (the
"Indenture Trustee"), substantially in the form attached as an exhibit to the
Registration Statement; (ii) the registration and issuance of up to
$5,000,000,000, or the equivalent amount in one or more foreign currencies,
aggregate principal amount of Funding Notes to be issued by Global Funding (each
a "Funding Note"), substantially in the form attached as an exhibit to the
Registration Statement, to be sold to the Trusts in connection with the sale of
the Notes; and (iii) the registration and issuance of up to $5,000,000,000, or
the equivalent amount in one or more foreign currencies, of Allstate Life's
funding agreements (each a "Funding Agreement"), substantially in the form
attached as an exhibit to the Registration Statement, to be sold to Global
Funding, which will immediately grant a security interest in, pledge and
collaterally assign the relevant Funding Agreement(s) to the Funding Note
Indenture Trustee and will immediately thereafter assign absolutely to and
deposit into the relevant Trust the relevant Funding Agreement(s), and the
relevant Funding Note will be surrendered and cancelled by Global Funding upon
such surrender, in connection with the sale of Notes. Capitalized terms used in
this opinion letter which are not otherwise defined herein have the meanings
ascribed to them in the Standard Indenture Terms attached as an exhibit to the
Registration Statement.
In furnishing this opinion, we have reviewed:
(i) the Registration Statement, the Prospectus, the Institutional
Prospectus Supplement and the Retail Prospectus Supplement;
(ii) the form of Amended and Restated Trust Agreement of Global
Funding, among Wilmington Trust Company, as Delaware trustee,
AMACAR Pacific Corp., as administrator, and AMACAR Pacific Corp.,
as trust beneficial owner, filed as an exhibit to the
Registration Statement;
(iii) the Standard Trust Terms, the Standard Indenture Terms and the
Standard Funding Note Indenture Terms, each filed as an exhibit
to the Registration Statement;
(iv) the form of Series Instrument for each Trust filed as an exhibit
to the Registration Statement;
(v) the form of Trust Agreement for each Trust included in the form
of Series Instrument;
(vi) the form of Indenture included in the form of Series Instrument;
(vii) the form of Funding Agreement filed as an exhibit to the
Registration Statement;
(viii) the form of Funding Note filed as an exhibit to the
Registration Statement; and
(ix) the form of Closing Instrument filed as an exhibit to the
Registration Statement.
We have also examined and relied upon originals or copies of originals
certified or otherwise identified to our satisfaction, of such records,
agreements, documents and other instruments, and such certificates or comparable
documents that, in our judgment, are necessary or appropriate to enable us to
render the opinions expressed below. In such examination, we have assumed the
authenticity of all documents submitted to us as originals, the genuineness of
all signatures, the legal capacity of all natural persons and the conformity to
authentic original documents of any copies submitted to us for our examination.
We have relied as to factual matters upon, and have assumed the accuracy of,
representations, statements and certificates of or from public officials and of
or from officers and representatives of all persons whom we have deemed
appropriate. With your permission, for purposes of the opinions expressed
herein, we have assumed that: (i) the Indenture Trustee has the power and
authority to authenticate the Notes; (ii) the terms of the Notes issued by any
Trust will be duly established so as not to violate applicable law or result in
a default under or breach of any agreement or instrument binding as to such
Trust and so as to comply with any requirement or restriction imposed by any
court or governmental body having jurisdiction over such Trust; (iii) the
Funding Note Indenture Trustee has the power and authority to authenticate each
applicable Funding Note; (iv) the terms of the Funding Notes issued by Global
Funding will be duly established so as not to violate applicable law or result
in a default under or breach of any agreement or instrument binding as to Global
Funding and so as to comply with any requirement or restriction imposed by any
court or governmental body having jurisdiction over Global Funding; (v) each
Trust (a) will be duly formed and validly existing as a statutory trust under
the laws of the state of Delaware, (b) will have the power to issue its Notes,
and (c) will have duly authorized the execution and delivery of the Notes prior
to their issuance; and (vi) Global Funding (a) has been duly formed and validly
existing as a statutory trust under the laws of the state of Delaware, (b) has
the power to issue each Funding Note, and (c) has duly authorized the execution
and delivery of each Funding Note prior to its issuance.
Based upon and subject to the foregoing, and subject to the further
qualifications and limitations set forth below, we are of the opinion that:
1. Upon (i) the execution of any Notes by a Trust in accordance with
the applicable Indenture; (ii) the authentication of such Notes
by the Indenture Trustee in accordance with the applicable
Indenture; and (iii) the issuance and delivery of such Notes
against payment therefor as contemplated by the Registration
Statement, such Notes will constitute valid and binding
obligations of such Trust, enforceable against such Trust in
accordance with their terms; and
2. Upon (i) the execution of any Funding Note by Global Funding in
accordance with the applicable Funding Note Indenture; (ii) the
authentication of such Funding Note by the Funding Note Indenture
Trustee in accordance with the applicable Funding Note Indenture;
and (iii) the issuance and delivery of such Funding Note against
payment therefor as contemplated by the Registration Statement,
such Funding Note will constitute a valid and binding obligation
of Global Funding, enforceable against Global Funding in
accordance with their terms.
The foregoing opinions with regard to the enforceability of the Notes and
the Funding Notes are: (i) subject to bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or affecting creditors' rights, and the
rights of creditors of insurers, generally, to the general supervisory powers of
insurance regulatory agencies, and to general principles of equity (regardless
of whether such principles are considered in a proceeding in equity or at law);
and (ii) subject to the further qualification that, to the extent that the
relevant Notes or relevant Funding Note are denominated in a currency other than
United States dollars, a claim thereunder (or foreign currency judgment in
respect to such claim) would be converted into United States dollars at a rate
of exchange prevailing on a date determined pursuant to applicable law.
We express no opinion as to the effect of any Federal or state laws
regarding fraudulent transfers or conveyances. We express no opinion as to the
laws of any jurisdiction other than the Federal laws of the United States and
the laws of the State of New York. In particular (and without limiting the
generality of the foregoing) we express no opinion concerning the effect, if
any, of any law of any jurisdiction (except the State of New York) in which any
holder of any Notes is located that limits the rate of interest that such holder
may charge or collect. Furthermore, we express no opinion as to: (i) whether a
United States Federal court would accept jurisdiction in any dispute, action,
suit or proceeding arising out of or relating to any Notes or any Indenture or
the transactions contemplated thereby; (ii) any waiver of inconvenient forum;
(iii) judgments in currencies other than United States dollars; or (iv) the
perfection or priority of any security interest in any collateral.
This opinion letter is rendered as of the date hereof based upon the facts
and law in existence on the date hereof. We assume no obligation to update or
supplement this opinion letter to reflect any circumstances that may come to our
attention after the date of effectiveness of the Registration Statement with
respect to the opinions and statements set forth above, including any changes in
applicable law that may occur after the date of effectiveness of the
Registration Statement.
Very truly yours,
/s/ Leboeuf, Lamb, Green & MacRae LLP
Exhibit 8
[Letterhead of Leboeuf, Lamb, Green & MacRae LLP]
February 27, 2006
Allstate Life Insurance Company
3100 Sanders Road
Northbrook, Illinois 60062
Allstate Life Global Funding
c/o AMACAR Pacific Corp.
6525 Morrison Boulevard, Suite 318
Charlotte, North Carolina 28211
Re: ALLSTATE LIFE INSURANCE COMPANY
ALLSTATE LIFE GLOBAL FUNDING
$5,000,000,000 SECURED MEDIUM TERM NOTES
REGISTRATION STATEMENT ON FORM S-3
Ladies and Gentlemen:
We have acted as special United States federal income tax counsel to
Allstate Life Insurance Company, a stock life insurance company organized under
the laws of the State of Illinois ("Allstate Life"), and Allstate Life Global
Funding, a statutory trust organized under the laws of the State of Delaware
("Global Funding"), in connection with the preparation and filing with the
Securities and Exchange Commission (the "Commission") under the Securities Act
of 1933, as amended (the "Securities Act"), by Allstate Life and Global Funding,
of a Registration Statement on Form S-3 (File No. 333-129157) on October 20,
2005, as amended by Amendment No. 1 filed with the Commission on November 29,
2005 and Amendment No. 2 filed with the Commission on February 27, 2006
(including the documents incorporated by reference therein, the "Registration
Statement"), including: (i) a prospectus (the "Prospectus") relating to secured
medium term notes (the "Notes") to be issued from time to time by newly
established separate and distinct Delaware statutory trusts (each, a "Trust" and
together, the "Trusts"); (ii) a prospectus supplement to the Prospectus relating
to Notes to be issued from time to time by the Trusts under the Secured Medium
Term Note program described therein primarily to institutional investors (the
"Institutional Prospectus Supplement"); and (iii) a prospectus supplement to the
Prospectus relating to Notes to be issued from time to time by the Trusts under
the Allstate Life(R) CoreNotes(R) program described therein primarily to retail
investors (the "Retail Prospectus Supplement").
The Registration Statement provides for: (i) the registration and issuance
of up to $5,000,000,000, or the equivalent amount in one or more foreign
currencies, aggregate principal amount of Notes to be issued by the Trusts, with
each Trust to issue Notes, pursuant to an Indenture (each an "Indenture") to be
entered into among such Trust and J.P. Morgan Trust Company, National
Association, or another entity specified therein, as indenture trustee (the
"Indenture Trustee"), substantially in the form attached as an exhibit to the
Registration Statement; (ii) the registration and issuance of up to
$5,000,000,000, or the equivalent amount in one or more foreign currencies,
aggregate principal amount of Funding Notes to be issued by Global Funding (each
a "Funding Note"), substantially in the form attached as an exhibit to the
Registration Statement, to be sold to the Trusts in connection with the sale of
the Notes; and (iii) the registration and issuance of up to $5,000,000,000, or
the equivalent amount in one or more foreign currencies, of Allstate Life's
funding agreements (each a "Funding Agreement"), substantially in the form
attached as an exhibit to the Registration Statement, to be sold to Global
Funding, which will immediately grant a security interest in, pledge and
collaterally assign the relevant Funding Agreement(s) to the Funding Note
Indenture Trustee and will immediately thereafter assign absolutely to and
deposit into the relevant Trust the relevant Funding Agreement(s), and the
relevant Funding Note will be surrendered and cancelled by Global Funding upon
such surrender, in connection with the sale of Notes and such cancellation shall
operate as a redemption and satisfaction of the Funding Note. The Funding Note
and the Funding Agreements will have a principal amount equal to the principal
amount of the Notes. The Funding Note and the Funding Agreements will otherwise
have payment and other terms substantially similar to the Notes. Capitalized
terms used in this opinion letter which are not otherwise defined herein have
the meanings ascribed to them in the Standard Indenture Terms attached as an
exhibit to the Registration Statement.
The payments under the relevant Funding Agreement(s) issued by Allstate
Life will be structured to meet in full the relevant Trust's scheduled payment
obligations under the Note issued by such Trust. Payment of principal and
interest on the Notes will be made solely from payments made by Allstate Life
under the applicable Funding Agreement(s). Capitalized terms used in this
opinion letter which are not otherwise defined herein have the meanings ascribed
to them in the Standard Indenture Terms.
In formulating our opinions in this letter, we have reviewed (i) the
Registration Statement, (ii) the Prospectus, (iii) the Institutional Prospectus
Supplement, (iv) the Retail Prospectus Supplement, (v) the Standard Trust
Agreement Terms and the Standard Indenture Terms, each filed as an exhibit to
the Registration Statement, (vi) the form of Series Instrument filed as an
exhibit to the Registration Statement that includes the Trust Agreement and the
Indenture to be executed through the execution of the Series Instrument, (vii)
the form of Funding Agreement filed as an exhibit to the Registration Statement,
(viii) the form of Funding Note filed as an exhibit to the Registration
Statement and (ix) such other certificates, records, and other documents as we
have deemed necessary or appropriate to enable us to render our opinions set
forth below.
In our examination, we have assumed the legal capacity of all natural
persons, the genuineness of all signatures, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as certified, conformed or other copies, and the
authenticity of the originals of such copies.
In rendering our opinions in this letter, we have assumed that the
transactions described in or contemplated by the foregoing documents have been
or will be consummated in accordance with the operative documents, and that such
documents accurately reflect the material facts of such transactions. Our
opinion is also based on the Internal Revenue Code of 1986, as amended (the
"Code"), Treasury regulations, administrative rulings, judicial decisions and
other applicable authorities. The statutory provisions, regulations and
interpretations on which our opinion is based are subject to change, possibly
retroactively. In addition, there can be no assurance that the Internal Revenue
Service will not take positions contrary to those stated in our opinion letter.
Subject to the foregoing, under current law and based upon the facts,
assumptions and qualifications contained herein, it is our opinion that:
1. Global Funding and each Trust will be ignored for United States
federal income tax purposes and will not be treated as an
association or a publicly traded partnership taxable as a
corporation; and
2. The Notes will be classified as indebtedness of Allstate Life for
United States federal income tax purposes.
The opinions we express herein are limited solely to matters governed by
the federal income tax laws of the United States. No opinion may be implied or
inferred beyond that which is expressly stated in this opinion letter. We
disclaim any obligation to update this opinion letter for events occurring or
coming to our attention after the date hereof.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving such consent, we do not admit that we are in
the category of persons whose consent is required under Section 7 of the Act.
Very truly yours,
/s/ Leboeuf, Lamb, Green & MacRae LLP
EXHIBIT 10.2
FORM OF SECURITY FOR
FUNDING NOTE RELATED TO SECURED MEDIUM TERM NOTES ISSUED
UNDER THE ALLSTATE LIFE(R) CORENOTES(R) PROGRAM
[FACE OF SECURITY]
CUSIP No.:
ALLSTATE LIFE GLOBAL FUNDING
FUNDING NOTE
Title of Funding Note: Stated Maturity Date:
Trust: Securities Exchange Listing: [ ] Yes [ ] No. If yes,
Principal Amount: $ indicate name(s) of Securities Exchange(s):
Original Issue Date:
Issue Price:
Interest Rate or Formula:
Floating Rate Note: [ ] Yes [ ] No. [ ] If
Fixed Rate Note: [ ] Yes [ ] No. If yes, yes,
Interest Rate: [ ] Regular Floating Rate Note: [ ]
Interest Payment Dates: Floating Rate/Fixed Rate Note: [ ]
Day Count Convention: Interest Rate:
Additional/Other Terms: Interest Rate Basis(es):
Discount Note: [ ] Yes [ ] No. If yes, CD Rate [ ]
Total Amount of Discount: CMT Rate [ ]
Initial Accrual Period of Discount: Commercial Paper Rate [ ]
Additional/Other Terms: Constant Maturity Swap Rate [ ]
Redemption Provisions: [ ] Yes [ ] No. If yes Federal Funds Open Rate [ ]
Initial Redemption Date: Federal Funds Rate [ ]
Initial Redemption Percentage LIBOR [ ]
Annual Redemption Percentage Reduction, Prime Rate [ ]
if any: Treasury Rate [ ]
Additional/Other Terms: [ ] If LIBOR:
Regular Interest Record Date(s): [ ] LIBOR Moneyline Telerate:
Sinking Fund: [ ] LIBOR Reuters:
Funding Note Calculation Agent: [ ] LIBOR Currency:
Authorized Denominations: If CMT Rate:
Collateral: The right, title and interest of the Trust in
and to: Designated CMT Telerate Page:
(i) Allstate Life Insurance Company Funding If CMT Moneyline Telerate Page
Agreement No(s). [ ]; (ii) all proceeds in respect of 7052:
such Funding Agreement(s); and (iii) all books and [ ] Weekly Average
records (including, without limitation, computer [ ] Monthly Average
programs, printouts, and other computer materials Designated CMT Maturity Index:
and files) pertaining to such Funding Agreement(s). Index Maturity:
Additional Amounts to be Paid for Withholding Tax: Spread (+/-), if any:
[ ] Yes [ ] No Spread Multiplier, if any:
Initial Interest Rate, if any:
Initial Interest Reset Date:
Interest Reset Dates:
Interest Determination Date(s):
Interest Payment Dates:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Fixed Rate Commencement Date, if any:
Floating Interest Rate, if any:
Fixed Interest Rate, if any:
Day Count Convention
Additional/Other Terms:
"Allstate Life(R)" is a registered servicemark of Allstate Insurance Company.
"CoreNotes(R)" is a registered servicemark of Merrill Lynch & Co., Inc.
This note certificate (the "Funding Note Certificate") represents a duly
authorized funding note (the "Funding Note") of Allstate Life Global Funding, a
statutory trust organized under the laws of the State of Delaware ("Global
Funding"). The Funding Note is being issued in connection with the issuance and
sale by the trust specified above (the "Trust") of the trust notes identified on
Annex A to that certain series instrument to which Global Funding and the Trust
are parties (the "Series Instrument") (the "Trust Notes"). The Funding Note is
being issued under the Funding Note Indenture, effective as of the date hereof
(as amended or supplemented from time to time, the "Funding Note Indenture")
between Global Funding and the other persons specified therein. Capitalized
terms used herein and not otherwise defined shall have the respective meanings
ascribed in the Standard Funding Note Indenture Terms, which are incorporated by
reference in and form a part of the Funding Note Indenture (as amended or
supplemented from time to time, the "Standard Funding Note Indenture Terms").
Subject to the immediately following paragraph, Global Funding, for value
received, hereby promises to pay to the Holder or Holders of the Funding Note on
the Maturity Date (as defined below) (or on the date of redemption or repayment
by Global Funding) the principal amount of the Funding Note and, if so specified
above, to pay interest from time to time on the Funding Note from the Original
Issue Date specified above (the "Original Issue Date") or from the most recent
Interest Payment Date to which interest has been paid or duly provided for at
the rate per annum determined in accordance with the provisions on the reverse
hereof and as specified above, until the principal of the Funding Note is paid
or made available for payment and to pay such other amounts due and owing with
respect to the Funding Note.
This Funding Note Certificate shall be surrendered for cancellation by or
on behalf of the Trust, and shall be cancelled by the Funding Note Indenture
Trustee, immediately upon the assignment by Global Funding to, or as directed
by, the Trust of each funding agreement identified on Exhibit A to the Closing
Instrument (each, a "Funding Agreement") in accordance with the terms of the
Funding Note and the Coordination Agreement, and such cancellation shall operate
as a redemption and satisfaction of the Funding Note.
On any exchange or purchase and cancellation of the Funding Note, details
of such exchange or purchase and cancellation shall be entered in the records of
2
Global Funding. Upon any such exchange or purchase and cancellation, the
principal amount of the Funding Note shall be charged by the principal amount so
exchanged or purchased and cancelled, as provided in the Standard Funding Note
Indenture Terms.
Unless otherwise set forth above, if the Funding Note is subject to an
Annual Redemption Percentage Reduction as specified above, the Redemption Price
of the portion of the Funding Note represented by this Funding Note Certificate
shall initially be the Initial Redemption Percentage of the principal amount of
the portion of the Funding Note represented by this Funding Note Certificate on
the Initial Redemption Date and shall decline at each anniversary of the Initial
Redemption Date (each such date, a "Redemption Date") by the Annual Redemption
Percentage Reduction of such principal amount until the Redemption Price is 100%
of such principal amount.
The Funding Note will mature on the earlier of the Stated Maturity Date and
the Maturity Date (as defined in the Trust Notes) of the Trust Notes (the "Trust
Notes Maturity Date"), unless its principal (or, any installment of its
principal) becomes due and payable prior to any such date, whether, as
applicable, by the declaration of acceleration of maturity, notice of redemption
at the option of Global Funding, notice of the Holder's option to elect
repayment or otherwise (the Stated Maturity Date, the Trust Notes Maturity Date
or any date prior to any such date on which the Funding Note becomes due and
payable, as the case may be, are referred to as the "Maturity Date" with respect
to principal of the Funding Note repayable on such date).
Unless otherwise provided above and except as provided in the following
paragraph, Global Funding will pay interest on each Interest Payment Date
specified above, commencing with the first Interest Payment Date next succeeding
the Original Issue Date, and on the Maturity Date; provided that any payment of
principal, premium, if any, interest or other amounts to be made on any Interest
Payment Date or on a Maturity Date that is not a Business Day shall be made in
accordance with the provision set forth on the reverse hereof.
Unless otherwise specified above, the interest payable on each Interest
Payment Date or on the Maturity Date will be the amount equal to the interest
accrued from and including the immediately preceding Interest Payment Date in
respect of which interest has been paid or from and including the date of issue,
if no interest has been paid, to but excluding the applicable Interest Payment
Date or the Maturity Date, as the case may be (each, an "Interest Period").
Reference is hereby made to the further provisions of the Funding Note set
forth on the reverse hereof and, if so specified on the face hereof, in an
Addendum hereto, which further provisions shall for all purposes have the same
force and effect as if set forth on the face hereof.
Notwithstanding the foregoing, if an Addendum is attached hereto or
"Other/Additional Provisions" apply to the Funding Note as specified above, the
Funding Note shall be subject to the terms set forth in such Addendum or such
"Other/Additional Provisions."
The Funding Note or the portion thereof represented by this Funding Note
Certificate shall not be valid or become obligatory for any purpose until the
certificate of authentication hereon shall have been executed by the Funding
Note Indenture Trustee pursuant to the Funding Note Indenture.
3
IN WITNESS WHEREOF, Global Funding has caused this instrument to be duly
executed on its behalf.
Dated: Original Issue Date ALLSTATE LIFE GLOBAL FUNDING,
as Issuer
By:
------------------------------------------------
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This Funding Note Certificate is one of the Funding Note Certificates
representing the Funding Note described in the within-mentioned Funding Note
Indenture.
Dated: Original Issue Date [J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION],
as Funding Note Indenture Trustee
By:
------------------------------------------------
Authorized Signatory
4
[REVERSE OF DEFINITIVE SECURITY]
SECTION 1. General. This Funding Note is being issued pursuant to the
Funding Note Indenture in connection with the issuance and sale by the Trust of
the Trust Notes. The Funding Note shall be surrendered for cancellation by or on
behalf of the Trust, and shall be cancelled by the Funding Note Indenture
Trustee, immediately upon the assignment by Global Funding to, or as directed
by, the Trust of each Funding Agreement, and such cancellation shall operate as
a redemption and satisfaction of the Funding Note.
SECTION 2. Currency. The Funding Note is denominated in, and payments of
principal, premium, if any, and/or interest, if any, will be made in U.S.
dollars.
SECTION 3. Determination of Interest Rate and Other Payment Provisions.
Fixed Rate Note. If the Funding Note is designated on the face hereof as a
"Fixed Rate Note", the Funding Note will bear interest from the Original Issue
Date until the Maturity Date. Unless otherwise specified on the face hereof, the
rate of interest payable on the Funding Note will not be adjusted; unless
otherwise specified on the face hereof, interest will be payable on the Interest
Payment Dates set forth on the face hereof and at the Maturity Date. Interest
will be computed on the basis of a 360-day year of twelve 30-day months. If any
Interest Payment Date or the Maturity Date of a Fixed Rate Note falls on a day
that is not a Business Day, any payments of principal, premium, if any, and/or
interest or other amounts required to be made, will be made on the next
succeeding Business Day, and no additional interest will accrue in respect of
the payment made on that next succeeding Business Day.
Discount Note. If the Funding Note is designated on the face hereof as a
"Discount Notes" (as defined below), payments in respect of the Funding Note
shall be made as set forth on the face hereof. In the event a Discount Note is
redeemed, repaid or accelerated, the amount payable to the Holder of the
Discount Note will be equal to the sum of: (1) the Issue Price (increased by any
accruals of discount) and, in the event of any redemption of such Discount Note,
if applicable, multiplied by the Initial Redemption Percentage (as adjusted by
the Annual Redemption Percentage Reduction, if applicable); and (2) any unpaid
interest accrued on the Discount Note to the date of redemption, repayment or
acceleration of maturity, as applicable. For purposes of determining the amount
of discount that has accrued as of any date on which a redemption, repayment or
acceleration of maturity of the Funding Note occurs for a Discount Note, the
discount will be accrued using a constant yield method. The constant yield will
be calculated using a 30-day month, 360-day year convention, a compounding
period that, except for the Initial Period (as defined below), corresponds to
the shortest period between Interest Payment Dates for a Discount Note (with
ratable accruals within a compounding period), a coupon rate equal to the
initial coupon rate applicable to a Discount Note and an assumption that the
maturity of such Discount Note will not be accelerated. If the period from the
date of issue to the first Interest Payment Date for a Discount Note (the
"Initial Period") is shorter than the compounding period for such Discount Note,
a proportionate amount of the yield for an entire compounding period will be
accrued. If the Initial Period is longer than the compounding period, then the
period will be divided into a regular compounding period and a short period with
the short period being treated as provided in the preceding sentence. The
accrual of the applicable discount may differ from the accrual of original issue
discount for purposes of the Code, certain Discount Notes may not be treated as
having original issue discount within the meaning of the Code, and certain
Funding Notes other than Discount Notes may be treated as issued with original
issue discount for federal income tax purposes. The Funding Note is a "Discount
Note" if its Issue Price is less than 100% of the principal amount thereof by
more than a percentage equal to the product of 0.25% and the number of full
years to the Stated Maturity Date. A Discount Note may not bear any interest
currently or may bear interest at a rate that is below market rates at the time
of issuance.
Floating Rate Note. If the Funding Note is specified on the face hereof as
"Floating Rate Note", interest on the Funding Note shall accrue and be payable
in accordance with this Section 3. A Floating Rate Note may be a CD Rate Note,
CMT Rate Note, Commercial Paper Rate Note, Constant Maturity Swap Rate Note,
Federal Funds Open Rate Note, Federal Funds Rate Note, LIBOR Note,
Prime Rate Note or Treasury Rate Note. If the Funding Note is designated on
the face hereof as Floating Rate Note, the face hereof will specify whether the
Funding Note is a Regular Floating Rate Note or Floating Rate/Fixed Rate Note.
For the period from the date of issue to, but not including, the first Interest
Reset Date set forth on the face hereof, the interest rate hereon shall be the
5
Initial Interest Rate specified on the face hereof. Thereafter, the interest
rate hereon will be reset as of and be effective as of each Interest Reset Date.
(A) If any Interest Reset Date would otherwise be a day that is not a
Business Day, such Interest Reset Date shall be postponed to the next
day that is a Business Day; provided, however, that if the Funding
Note is a LIBOR Note and such Business Day is in the next succeeding
calendar month, such Interest Reset Date shall be the Business Day
immediately preceding such Interest Reset Date.
(B) Unless specified otherwise on the face hereof, Interest Reset Dates
are as follows: (1) if the Funding Note resets daily, each Business
Day; (2) if the Funding Note resets weekly, other than a Treasury Rate
Note, the Wednesday of each week; (3) if the Funding Note is a
Treasury Rate Note that resets weekly, and except as provided below
under "Treasury Rate Note", the Tuesday of each week; (4) if the
Funding Note resets monthly, the third Wednesday of each month; (5) if
the Funding Note resets quarterly, the third Wednesday of every third
calendar month, beginning in the third calendar month following the
month in which the Notes were issued; (6) if the Funding Note resets
semiannually, the third Wednesday of each of the two months specified
on the face hereof; and (7) if the Funding Note resets annually, the
third Wednesday of the month specified on the face hereof; provided,
however, that with respect to a Floating Rate/Fixed Rate Note, the
rate of interest thereon will not reset after the particular Fixed
Rate Commencement Date specified on the face hereof (the "Fixed Rate
Commencement Date").
(C) Accrued interest is calculated by multiplying the principal amount of
the Floating Rate Note by an accrued interest factor. The accrued
interest factor is computed by adding the interest factor calculated
for each day in the particular Interest Period. The interest factor
for each day will be computed by dividing the interest rate applicable
to such day by 360, in the case of a Floating Rate Note as to which
the CD Rate, the Commercial Paper Rate, the Federal Funds Open Rate,
the Federal Funds Rate, LIBOR or the Prime Rate is an applicable
Interest Rate Basis (as defined below), or by the actual number of
days in the year, in the case of a Floating Rate Note as to which the
CMT Rate or the Treasury Rate is an applicable Interest Rate Basis. In
the case of a Floating Rate Note as to which the Constant Maturity
Swap Rate is the Interest Rate Basis, the interest factor will be
computed by dividing the number of days in the interest period by 360
(the number of days to be calculated on the basis of a year of 360
days with 12 30-day months (unless (i) the last day of the interest
period is the 31st day of a month but the first day of the interest
period is a day other than the 30th or 31st day of a month, in which
case the month that includes that last day shall not be considered to
be shortened to a 30-day month, or (ii) the last day of the interest
period is the last day of the month of February, in which case the
month of February shall not be considered to be lengthened to a 30-day
month)). The interest factor for a Floating Rate Note as to which the
interest rate is calculated with reference to two or more Interest
Rate Bases will be calculated in each period in the same manner as if
only the applicable Interest Rate Basis specified on the face hereof
applied. The interest rate shall be set forth on the face hereof. For
purposes of making the foregoing calculation, the interest rate in
effect on any Interest Reset Date will be the applicable rate as reset
on that date. Unless otherwise specified on the face hereof, the
interest rate that is effective on the applicable Interest Reset Date
will be determined on the applicable Interest Determination Date and
calculated on the applicable Funding Note Funding Note Calculation
Date (as defined below). "Funding Note Calculation Date" means the
date by which the Funding Note Calculation Agent designated on the
face hereof, is to calculate the interest rate which will be the
earlier of (1) the tenth calendar day after the particular Interest
Determination Date or, if such day is not a Business Day, the next
succeeding Business Day; or (2) the Business Day immediately preceding
the applicable Interest Payment Date or the Maturity Date, as the case
may be.
(D) Unless otherwise specified on the face hereof, all percentages
resulting from any calculation on a Floating Rate Note will be rounded
to the nearest one hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upwards. All dollar
amounts used in or resulting from any calculation on a Floating Rate
Note will be rounded to the nearest cent.
(E) Unless otherwise specified on the face hereof, if the Funding Note is
designated on the face hereof as a Floating Rate Note, if any Interest
6
Payment Date (other than the Maturity Date for the Funding Note) would
otherwise be a day that would not be a Business Day, such Interest
Payment Date would be postponed to the next succeeding Business Day;
provided, however, that if the Funding Note is a LIBOR Note and such
Business Day is in the next succeeding calendar month, such Interest
Payment Date shall be the immediately preceding Business Day. Unless
otherwise specified on the face hereof, if the Funding Note is
designated on the face hereof as a Floating Rate Note, if the Maturity
Date of the Funding Note falls on a day this is not a Business Day,
Global Funding will make the required payment of principal, premium,
if any, and interest or other amounts on the next succeeding Business
Day, and no additional interest will accrue in respect of the payment
made on that next succeeding Business Day.
Unless otherwise specified on the face hereof and except as provided below,
interest will be payable as follows: (1) if the Interest Reset Date for the
Funding Note is daily, weekly or monthly, interest will be payable on the third
Wednesday of each month or on the third Wednesday of every third calendar month,
beginning in the third calendar month following the month in which the Notes
were issued, as specified on the face hereof; (2) if the Interest Reset Date for
the Funding Note is quarterly, interest will be payable on the third Wednesday
every third calendar month, beginning in the third calendar month following the
month in which the Notes were issued; (3) if the Interest Reset Date for the
Funding Note is semiannually, interest will be payable on the third Wednesday of
each of two months of each year specified on the face hereof; (4) if the
Interest Reset Date for the Funding Note is annually, interest will be payable
on the third Wednesday of the month of each year specified on the face hereof.
In each of these cases, the Maturity Date will also be an Interest Payment Date.
If specified on the face hereof, the Funding Note may have either or both
of a Maximum Interest Rate or Minimum Interest Rate. If a Maximum Interest Rate
is so designated, the interest rate that may accrue during any Interest Period
for a Floating Rate Note cannot ever exceed such Maximum Interest Rate and in
the event that the interest rate on any Interest Reset Date would exceed such
Maximum Interest Rate (as if no Maximum Interest Rate were in effect) then the
interest rate on such Interest Reset Date shall be the Maximum Interest Rate. If
a Minimum Interest Rate is so designated, the interest rate that may accrue
during any Interest Period for a Floating Rate Note cannot ever be less than
such Minimum Interest Rate and in the event that the interest rate on any
Interest Reset Date would be less than such Minimum Interest Rate (as if no
Minimum Interest Rate were in effect) then the interest rate on such Interest
Reset Date shall be the Minimum Interest Rate. Notwithstanding anything to the
contrary contained herein, if the Funding Note is designated on the face hereof
as a Floating Rate Note, the interest rate on the Funding Note shall not exceed
the maximum interest rate permitted by applicable law.
All determinations of interest by the Funding Note Calculation Agent
designated on the face hereof will, in the absence of manifest error, be
conclusive for all purposes and binding on the Holder of the Funding Note and
neither the Funding Note Indenture Trustee nor the Funding Note Calculation
Agent shall have any liability to the Holder of the Funding Note in respect of
any determination, calculation, quote or rate made or provided by the Funding
Note Calculation Agent. Upon request of the Holder of the Funding Note, the
Funding Note Calculation Agent will provide the interest rate then in effect
and, if determined, the interest rate that will become effective on the next
Interest Reset Date with respect to the Funding Note. If the Funding Note
Calculation Agent is incapable or unwilling to act as such or if the Funding
Note Calculation Agent fails duly to establish the interest rate for any
interest accrual period or to calculate the interest amount or any other
requirements, Global Funding will appoint a successor to act as such in its
place. The Funding Note Calculation Agent may not resign its duties until a
successor has been appointed and such successor has accepted its appointment.
Subject to applicable provisions of law and except as specified herein, on
each Interest Reset Date, the rate of interest on the Funding Note on and after
the first Interest Reset Date shall be the interest rate determined in
accordance with the provisions of the heading below which has been designated as
the Interest Rate Basis on the face hereof (the "Interest Rate Basis"), the base
rate, plus or minus the Spread, if any, specified on the face hereof and/or
multiplied by the Spread Multiplier, if any, specified on the face hereof.
(A) CD Rate Note. If the Interest Rate Basis is the CD Rate, the Funding
Note shall be deemed to be a "CD Rate Note." A CD Rate Note will bear
interest at the interest rate calculated with reference to the CD Rate
and the Spread or Spread Multiplier, if any. The Funding Note
Calculation Agent will determine the CD Rate on each Interest
Determination Date. The Interest Determination Date is the second
7
Business Day preceding the related Interest Reset Date.
"CD Rate" means: (1) the rate on the particular Interest
Determination Date for negotiable United States dollar
certificates of deposit having the Index Maturity specified on
the face hereof as published in H.15(519) (as defined below)
under the caption "CDs (secondary market)"; or (2) if the rate
referred to in clause (1) is not so published by 3:00 P.M., New
York City time, on the related Funding Note Calculation Date, the
rate on the particular Interest Determination Date for negotiable
United States dollar certificates of deposit of the particular
Index Maturity as published in the H.15 Daily Update (as defined
below) or other recognized electronic source used for the purpose
of displaying the applicable rate under the heading "CDs
(secondary market)"; (3) if the rate referred to in clause (2) is
not yet published in either H.15(519) or the H.15 Daily Update by
3:00 P.M., New York City time, on the related Funding Note
Calculation Date, then the CD Rate will be the rate on the
particular Interest Determination Date calculated by the Funding
Note Calculation Agent as the arithmetic mean of the secondary
market offered rates as of 10:00 A.M., New York City time on that
Interest Determination Date of three leading nonbank dealers in
negotiable United States dollar certificates of deposit in The
City of New York (which may include the Agents or their
affiliates) selected by the Funding Note Calculation Agent for
negotiable United States dollar certificates of deposit of major
United States money market banks for negotiable United States
certificates of deposit with a remaining maturity closest to the
particular Index Maturity in an amount that is representative for
a single transaction in that market at that time; or (4) if the
dealers so selected by the Funding Note Calculation Agent are not
quoting as mentioned in clause (3), the CD Rate in effect on the
particular Interest Determination Date; provided that if no CD
Rate is then in effect, the interest rate that will be effective
as of the next Interest Reset Date will be the Initial Interest
Rate.
"H.15(519)" means the weekly statistical release designated as
H.15(519), or any successor publication, published by the Board
of Governors of the Federal Reserve System.
"H.15 Daily Update" means the daily update of H.15(519),
available through the world-wide-web site of the Board of
Governors of the Federal Reserve System at
http://www.federalreserve.gov/releases/H15/update, or any
successor site or publication.
(B) CMT Rate Note. If the Interest Basis is the CMT Rate, the Funding Note
shall be deemed to be a "CMT Rate Note." A CMT Rate Note will bear
interest at the interest rate calculated with reference to the CMT
Rate and the Spread or Spread Multiplier, if any. The Funding Note
Calculation Agent will determine the CMT Rate on each applicable
Interest Determination Date. The applicable Interest Determination
Date is the second Business Day prior to the Interest Reset Date.
"CMT Rate" means: (1) if CMT Moneyline Telerate Page 7051 is
specified on the face hereof: (a) the percentage equal to the
yield for United States Treasury securities at "constant
maturity" having the Index Maturity specified on the face hereof
as published in H.15(519) under the caption "Treasury Constant
Maturities", as the yield is displayed on Moneyline Telerate (or
any successor service) on page 7051 (or any other page as may
replace the specified page on that service) ("Moneyline Telerate
Page 7051"), for the particular Interest Determination Date; or
(b) if the rate referred to in clause (a) does not so appear on
Moneyline Telerate Page 7051, the percentage equal to the yield
for United States Treasury securities at "constant maturity"
having the particular Index Maturity and for the particular
Interest Determination Date as published in H.15(519) under the
caption "Treasury Constant Maturities"; or (c) if the rate
referred to in clause (b) does not so appear in H.15(519), the
rate on the particular Interest Determination Date for the period
of the particular Index Maturity as may then be published by
either the Federal Reserve System Board of Governors or the
8
United States Department of the Treasury that the Funding Note
Calculation Agent determines to be comparable to the rate which
would otherwise have been published in H.15(519); or (d) if the
rate referred to in clause (c) is not so published, the rate on
the particular Interest Determination Date calculated by the
Funding Note Calculation Agent as a yield to maturity based on
the arithmetic mean of the secondary market bid prices at
approximately 3:30 P.M., New York City time, on that Interest
Determination Date of three leading primary United States
government securities dealers in The City of New York (which may
include the Agents or their affiliates) (each, a "Reference
Dealer"), selected by the Funding Note Calculation Agent from
five Reference Dealers selected by the Funding Note Calculation
Agent and eliminating the highest quotation, or, in the event of
equality, one of the highest, and the lowest quotation or, in the
event of equality, one of the lowest, for United States Treasury
securities with an original maturity equal to the particular
Index Maturity, a remaining term to maturity no more than one
year shorter than that Index Maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at that time; or (e) if fewer than five but more
than two of the prices referred to in clause (d) are provided as
requested, the rate on the particular Interest Determination Date
calculated by the Funding Note Calculation Agent based on the
arithmetic mean of the bid prices obtained and neither the
highest nor the lowest of the quotations shall be eliminated; or
(f) if fewer than three prices referred to in clause (d) are
provided as requested, the rate on the particular Interest
Determination Date calculated by the Funding Note Calculation
Agent as a yield to maturity based on the arithmetic mean of the
secondary market bid prices as of approximately 3:30 P.M., New
York City time, on that Interest Determination Date of three
Reference Dealers selected by the Funding Note Calculation Agent
from five Reference Dealers selected by the Funding Note
Calculation Agent and eliminating the highest quotation or, in
the event of equality, one of the highest and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity
greater than the particular Index Maturity, a remaining term to
maturity closest to that Index Maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at that time; or (g) if fewer than five but more
than two prices referred to in clause (f) are provided as
requested, the rate on the particular Interest Determination Date
calculated by the Funding Note Calculation Agent based on the
arithmetic mean of the bid prices obtained and neither the
highest nor the lowest of the quotations will be eliminated; or
(h) if fewer than three prices referred to in clause (f) are
provided as requested, the CMT Rate in effect on the particular
Interest Determination Date; provided that if no CMT Rate is then
in effect, the interest rate that will be effective as of the
next Interest Reset Date will be the Initial Interest Rate; or
(2) if CMT Moneyline Telerate Page 7052 is specified on the face
hereof: (a) the percentage equal to the one-week or one-month, as
specified on the face hereof, average yield for United States
Treasury securities at "constant maturity" having the Index
Maturity specified on the face hereof as published in H.15(519)
opposite the caption "Treasury Constant Maturities", as the yield
is displayed on Moneyline Telerate (or any successor service) (on
page 7052 or any other page as may replace the specified page on
that service) ("Moneyline Telerate Page 7052"), for the week or
month, as applicable, ended immediately preceding the week or
month, as applicable, in which the particular Interest
Determination Date falls; or (b) if the rate referred to in
clause (a) does not so appear on Moneyline Telerate Page 7052,
the percentage equal to the one-week or one-month, as specified
on the face hereof, average yield for United States Treasury
securities at "constant maturity" having the particular Index
Maturity and for the week or month, as applicable, preceding the
particular Interest Determination Date as published in H.15(519)
opposite the caption "Treasury Constant Maturities"; or (c) if
the rate referred to in clause (b) does not so appear in
H.15(519), the one-week or one-month, as specified on the face
hereof, average yield for United States Treasury securities at
"constant maturity" having the particular Index Maturity as
otherwise announced by the Federal Reserve Bank of New York for
the week or month, as applicable, ended immediately preceding the
week or month, as applicable, in which the particular Interest
Determination Date falls; or (d) if the rate referred to in
clause (c) is not so published, the rate on the particular
9
Interest Determination Date calculated by the Funding Note
Calculation Agent as a yield to maturity based on the arithmetic
mean of the secondary market bid prices at approximately 3:30
P.M., New York City time, on that Interest Determination Date of
three Reference Dealers selected by the Funding Note Calculation
Agent from five Reference Dealers selected by the Funding Note
Calculation Agent and eliminating the highest quotation, or, in
the event of equality, one of the highest, and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity equal
to the particular Index Maturity, a remaining term to maturity no
more than one year shorter than that Index Maturity and in a
principal amount that is representative for a single transaction
in the securities in that market at that time; or (e) if fewer
than five but more than two of the prices referred to in clause
(d) are provided as requested, the rate on the particular
Interest Determination Date calculated by the Funding Note
Calculation Agent based on the arithmetic mean of the bid prices
obtained and neither the highest nor the lowest of the quotations
shall be eliminated; or (f) if fewer than three prices referred
to in clause (d) are provided as requested, the rate on the
particular Interest Determination Date calculated by the Funding
Note Calculation Agent as a yield to maturity based on the
arithmetic mean of the secondary market bid prices as of
approximately 3:30 P.M., New York City time, on that Interest
Determination Date of three Reference Dealers selected by the
Funding Note Calculation Agent from five Reference Dealers
selected by the Funding Note Calculation Agent and eliminating
the highest quotation or, in the event of equality, one of the
highest and the lowest quotation or, in the event of equality,
one of the lowest, for United States Treasury securities with an
original maturity greater than the particular Index Maturity, a
remaining term to maturity closest to that Index Maturity and in
a principal amount that is representative for a single
transaction in the securities in that market at the time; or (g)
if fewer than five but more than two prices referred to in clause
(f) are provided as requested, the rate on the particular
Interest Determination Date calculated by the Funding Note
Calculation Agent based on the arithmetic mean of the bid prices
obtained and neither the highest nor the lowest of the quotations
will be eliminated; or (h) if fewer than three prices referred to
in clause (f) are provided as requested, the CMT Rate in effect
on that Interest Determination Date; provided that if no CMT Rate
is then in effect, the interest rate that will be effective as of
the next Interest Reset Date will be the Initial Interest Rate.
If two United States Treasury securities with an original
maturity greater than the Index Maturity specified on the face
hereof have remaining terms to maturity equally close to the
particular Index Maturity, the quotes for the United States
Treasury security with the shorter original remaining term to
maturity will be used.
(C) Commercial Paper Rate Note. If the Interest Rate Basis is the
Commercial Paper Rate, the Funding Note shall be deemed to be a
"Commercial Paper Rate Note." A Commercial Paper Rate Note will bear
interest for each Interest Reset Date at the interest rate calculated
with reference to the Commercial Paper Rate and the Spread or Spread
Multiplier, if any. The Funding Note Calculation Agent will determine
the Commercial Paper Rate on each applicable Interest Determination
Date. The Interest Determination Date is the second Business Day
preceding the related Interest Reset Date.
"Commercial Paper Rate" means: (1) the Money Market Yield
(calculated as described below) on the Interest Determination
Date of the rate for commercial paper having the applicable Index
Maturity as such rate is published in H.15(519) under the heading
"Commercial Paper--Nonfinancial"; or (2) if the rate referred to
in clause (1) is not published by 3:00 P.M., New York City time,
on the Funding Note Calculation Date pertaining to such Interest
Determination Date, then the Commercial Paper Rate shall be the
Money Market Yield on the particular Interest Determination Date
of the rate for commercial paper having the particular Index
Maturity as published on H.15 Daily Update or such other
10
recognized electronic source used for the purposes of displaying
the applicable rate, under the caption "Commercial
Paper--Nonfinancial"; or (3) if the rate referred to in clause
(3) is not published by 3:00 P.M., New York City time, on the
Funding Note Calculation Date, then the Commercial Paper Rate as
calculated by the Funding Note Calculation Agent shall be the
Money Market Yield of the arithmetic mean of the offered rates at
approximately 11:00 A.M., New York City time, on that Interest
Determination Date of three leading dealers of United States
dollar commercial paper in The City of New York (which may
include the Agents or their affiliates) selected by the Funding
Note Calculation Agent for commercial paper having the particular
Index Maturity placed for industrial issuers whose bond rating is
"Aa" by Moody's or the equivalent from another nationally
recognized statistical rating organization; or (4) if the dealers
so selected by the Funding Note Calculation Agent are not quoting
as mentioned in clause (3) above, the Commercial Paper Rate in
effect on the particular Interest Determination Date; provided
that if no Commercial Paper Rate is then in effect, the interest
rate that will be effective as of the next Interest Reset Date
will be the Initial Interest Rate.
"Money Market Yield" shall be a yield (expressed as a percentage)
calculated in accordance with the following formula:
Money Market Yield = D x 360 x 100
----------------------
360 - (D x M)
where "D" refers to the per annum rate for the commercial paper,
quoted on a bank discount basis and expressed as a decimal; and
"M" refers to the actual number of days in the applicable
Interest Period.
(D) Constant Maturity Swap Rate Notes. If the Interest Basis is the
Constant Maturity Swap Rate, the Notes shall be deemed to be "Constant
Maturity Swap Rate Notes." Constant Maturity Swap Rate Notes will bear
interest at the interest rate calculated with reference to the
Constant Maturity Swap Rate and the Spread or Spread Multiplier, if
any. The Funding Note Calculation Agent will determine the Constant
Maturity Swap Rate on each applicable Interest Determination Date. The
Interest Determination Date is the second U.S. Government Securities
Business Day (as defined below) preceding the related Interest Reset
Date; provided, however, that if, after attempting to determine the
Constant Maturity Swap Rate (as described below), such rate is not
determinable for a particular Interest Determination Date (the
"Original Interest Determination Date"), then such Interest
Determination Date shall be the first U.S. Government Securities
Business Day preceding the Original Interest Determination Date for
which the Constant Maturity Swap Rate can be determined as described
below.
Constant Maturity Swap Rate" means: (1) the rate for U.S. Dollar
swaps with the designated maturity specified on the face hereof,
expressed as a percentage, which appears on the Reuters Screen
ISDAFIX1 Page as of 11:00 A.M., New York City time, on the
particular Interest Determination Date; or (2) if the rate
referred to in clause (1) does not appear on the Reuters Screen
ISDAFIX1 Page by 2:00 P.M., New York City time, on such Interest
Determination Date, a percentage determined on the basis of the
mid-market semi-annual swap rate quotations provided by the
Reference Banks (as defined below) as of approximately 11:00
A.M., New York City time, on such Interest Determination Date,
and, for this purpose, the semi-annual swap rate means the mean
of the bid and offered rates for the semi-annual fixed leg,
calculated on a 30/360 day count basis, of a fixed-for-floating
U.S. Dollar interest rate swap transaction with a term equal to
the designated maturity specified in the face hereof commencing
on the Interest Reset Date and in a Representative Amount (as
defined below) with an acknowledged dealer of good credit in the
swap market, where the floating leg, calculated on an Actual/360
day count basis, is equivalent to USD-LIBOR-BBA with a designated
maturity specified on the face hereof. The Funding Note
Calculation Agent will request the principal New York City office
11
of each of the Reference Banks to provide a quotation of its
rate. If at least three quotations are provided, the rate for
that Interest Determination Date will be the arithmetic mean of
the quotations, eliminating the highest quotation (or, in the
event of equality, one of the highest) and the lowest quotation
(or, in the event of equality, one of the lowest).
"U.S. Government Securities Business Day" means any day except
for Saturday, Sunday, or a day on which The Bond Market
Association recommends that the fixed income departments of its
members be closed for the entire day for purposes of trading in
U.S. government securities.
"Representative Amount" means an amount that is representative
for a single transaction in the relevant market at the relevant
time.
"Reference Banks" mean five leading swap dealers in the New York
City interbank market, selected by the Funding Note Calculation
Agent, after consultation with Allstate Life Insurance Company.
(E) Federal Funds Open Rate Notes. If the Interest Basis is the Federal
Funds Open Rate, the Notes shall be deemed to be "Federal Funds Open
Rate Notes." Federal Funds Open Rate Notes will bear interest at the
interest rate calculated with reference to the Federal Funds Open Rate
and the Spread or Spread Multiplier, if any. The Funding Note
Calculation Agent will determine the Federal Funds Open Rate on each
applicable Interest Determination Date. The Interest Determination
Date is the related Interest Reset Date.
"Federal Funds Open Rate" means the rate set forth on Moneyline
Telerate Page 5 for an Interest Reset Date underneath the caption
"FEDERAL FUNDS" in the row titled "OPEN". If the rate is not
available for an Interest Reset Date, the rate for that Interest
Reset Date shall be the Federal Funds Rate as determined below.
(F) Federal Funds Rate Note. If the Interest Rate Basis is the Federal
Funds Rate, the Funding Note shall be deemed to be a "Federal Funds
Rate Note." A Federal Funds Rate Note will bear interest for each
Interest Reset Date at the interest rate calculated with reference to
the Federal Funds Rate and the Spread or Spread Multiplier, if any.
The Funding Note Calculation Agent will determine the Federal Funds
Rate on each applicable Interest Determination Date. The Interest
Determination Date is the Business Day immediately preceding the
related Interest Reset Date. "Federal Funds Rate" means: (1) the rate
on the particular Interest Determination Date for United States dollar
federal funds as published in H.15(519) under the caption "Federal
Funds (Effective)" and displayed on Moneyline Telerate (or any
successor service) on page 120 (or any other page as may replace the
specified page on that service) ("Moneyline Telerate Page 120"); or
(2) if the rate referred to in clause (1) does not so appear on
Moneyline Telerate Page 120 or is not so published by 3:00 P.M., New
York City time, on the related Funding Note Calculation Date, the rate
on the particular Interest Determination Date for United States dollar
federal funds as published in H.15 Daily Update, or such other
recognized electronic source used for the purpose of displaying the
applicable rate, under the caption "Federal Funds (Effective)"; or (3)
if the rate referred to in clause (2) is not so published by 3:00
P.M., New York City time, on the related Funding Note Calculation
Date, the rate on the particular Interest Determination Date
calculated by the Funding Note Calculation Agent as the arithmetic
mean of the rates for the last transaction in overnight United States
dollar federal funds arranged by three leading brokers of United
States dollar federal funds transactions in The City of New York
(which may include the Agents or their affiliates), selected by the
Funding Note Calculation Agent prior to 9:00 A.M., New York City time,
on the business day following that Interest Determination Date; or (4)
if the brokers so selected by the Funding Note Calculation Agent are
not quoting as mentioned in clause (3), the Federal Funds Rate in
effect on the particular Interest Determination Date; provided that if
no Federal Funds Rate is then in effect, the interest rate that will
be effective as of the next Interest Reset Date will be the Initial
Interest Rate.
(G) LIBOR Note. If the Interest Rate Basis is LIBOR (as defined below),
the Funding Note shall be deemed to be a "LIBOR Note." A LIBOR Note
will bear interest for each Interest Period at the
12
interest rate calculated with reference to LIBOR and the Spread or
Spread Multiplier, if any. On each applicable Interest Determination
Date the Funding Note Calculation Agent will determine LIBOR. The
applicable Interest Determination Date is the second London Banking
Day (as defined below) preceding the related Interest Reset Date.
LIBOR means: (1) if "LIBOR Moneyline Telerate" is specified on
the face hereof or if neither "LIBOR Reuters" nor "LIBOR
Moneyline Telerate" is specified on the face hereof as the method
for calculating LIBOR, the rate for deposits in the LIBOR
Currency (as defined below) having the Index Maturity specified
on the face hereof, commencing on the related Interest Reset
Date, that appears on the LIBOR Page (as defined below) as of
11:00 A.M., London time, on the particular Interest Determination
Date; or (2) if "LIBOR Reuters" is specified on the face hereof,
the arithmetic mean of the offered rates, calculated by the
Funding Note Calculation Agent, or the offered rate, if the LIBOR
Page by its terms provides only for a single rate, for deposits
in the LIBOR Currency having the particular Index Maturity,
commencing on the related Interest Reset Date, that appear or
appears, as the case may be, on the LIBOR Page as of 11:00 A.M.,
London time, on the particular Interest Determination Date; or
(3) if fewer than two offered rates appear, or no rate appears,
as the case may be, on the particular Interest Determination Date
on the LIBOR Page as specified in clause (1) or (2), as
applicable, the rate calculated by the Funding Note Calculation
Agent of at least two offered quotations obtained by the Funding
Note Calculation Agent after requesting the principal London
offices of each of four major reference banks (which may include
affiliates of the Agents), in the London interbank market to
provide the Funding Note Calculation Agent with its offered
quotation for deposits in the LIBOR Currency for the period of
the particular Index Maturity, commencing on the related Interest
Reset Date, to prime banks in the London interbank market at
approximately 11:00 A.M., London time, on that Interest
Determination Date and in a principal amount that is
representative for a single transaction in the LIBOR Currency in
that market at that time; or (4) if fewer than two offered
quotations referred to in clause (3) are provided as requested,
the rate calculated by the Funding Note Calculation Agent as the
arithmetic mean of the rates quoted at approximately 11:00 A.M.,
in the applicable Principal Financial Center, on the particular
Interest Determination Date by three major banks (which may
include affiliates of the Agents), in that Principal Financial
Center selected by the Funding Note Calculation Agent for loans
in the LIBOR Currency to leading European banks, having the
particular Index Maturity and in a principal amount that is
representative for a single transaction in the LIBOR Currency in
that market at that time; or (5) if the banks so selected by the
Funding Note Calculation Agent are not quoting as mentioned in
clause (4), LIBOR in effect on the particular Interest
Determination Date; provided that if no LIBOR is then in effect,
the interest rate that will be effective as of the next Interest
Reset Date will be the Initial Interest Rate.
"LIBOR Currency" means United States dollars.
"LIBOR Page" means either: (1) if "LIBOR Reuters" is specified on
the face hereof, the display on the Reuter Monitor Money Rates
Service (or any successor service) on the page specified on the
face hereof (or any other page as may replace that page on that
service) for the purpose of displaying the London interbank rates
of major banks for the LIBOR Currency; or (2) if "LIBOR Moneyline
Telerate" is specified on the face hereof or neither "LIBOR
Reuters" nor "LIBOR Moneyline Telerate" is specified on the face
hereof as the method for calculating LIBOR, the display on
Moneyline Telerate (or any successor service) on the page
specified on the face hereof (or any other page as may replace
such page on such service) for the purpose of displaying the
London interbank rates of major banks for the LIBOR Currency.
"London Banking Day" means a day on which commercial banks are
open for business (including dealing in the LIBOR Currency) in
London.
13
(H) Prime Rate Note. If the Interest Rate Basis is the Prime Rate, the
Funding Note shall be deemed to be "Prime Rate Note." Prime Rate Note
will bear interest for each Interest Reset Date calculated with
reference to the Prime Rate and the Spread or Spread Multiplier, if
any, subject to the Minimum Interest Rate and/or Maximum Interest
Rate, if any, specified on the face hereof. The Funding Note
Calculation Agent will determine the Prime Rate for each Interest
Reset Date on each applicable Interest Determination Date. The
Interest Determination Date is the Business Day immediately preceding
the related Interest Reset Date.
"Prime Rate" means: (1) the rate on the particular Interest
Determination Date as published in H.15(519) under the caption
"Bank Prime Loan"; or (2) if the rate referred to in clause (1)
is not so published by 3:00 P.M., New York City time, on the
related Funding Note Calculation Date, the rate on the particular
Interest Determination Date as published in H.15 Daily Update, or
such other recognized electronic source used for the purpose of
displaying the applicable rate, under the caption "Bank Prime
Loan"; or (3) if the rate referred to in clause (2) is not so
published by 3:00 P.M., New York City time, on the related
Funding Note Calculation Date, the rate on the particular
Interest Determination Date calculated by the Funding Note
Calculation Agent as the arithmetic mean of the rates of interest
publicly announced by each bank that appears on the Reuters
Screen US PRIME 1 Page (as defined below) as the applicable
bank's prime rate or base lending rate as of 11:00 A.M., New York
City time, on that Interest Determination Date; or (4) if fewer
than four rates referred to in clause (3) are so published by
3:00 P.M., New York City time, on the related Funding Note
Calculation Date, the rate on the particular Interest
Determination Date calculated by the Funding Note Calculation
Agent as the arithmetic mean of the prime rates or base lending
rates quoted on the basis of the actual number of days in the
year divided by a 360-day year as of the close of business on
that Interest Determination Date by three major banks (which may
include affiliates of the Agents) in The City of New York
selected by the Funding Note Calculation Agent; or (5) if the
banks so selected by the Funding Note Calculation Agent are not
quoting as mentioned in clause (4), the Prime Rate in effect on
the particular Interest Determination Date; provided that if no
Prime Rate is then in effect, the interest rate that will be
effective as of the next Interest Reset Date will be the Initial
Interest Rate.
"Reuters Screen US PRIME 1 Page" means the display on the Reuter
Monitor Money Rates Service (or any successor service) on the "US
PRIME 1" page (or any other page as may replace that page on that
service) for the purpose of displaying prime rates or base
lending rates of major United States banks.
(I) Treasury Rate Note. If the Interest Rate Basis is the Treasury Rate,
the Funding Note shall be deemed to be a "Treasury Rate Note." A
Treasury Rate Note will bear interest for each Interest Reset Date at
the interest rate calculated with reference to the Treasury Rate and
the Spread or Spread Multiplier, if any. The Funding Note Calculation
Agent will determine the Treasury Rate on each Treasury Rate
Determination Date (as defined below).
"Treasury Rate" means: (1) the rate from the auction held on the
Treasury Rate Interest Determination Date (the "Auction") of
direct obligations of the United States ("Treasury Bills") having
the Index Maturity specified on the face hereof under the caption
"INVESTMENT RATE" on the display on Moneyline Telerate (or any
successor service) on page 56 (or any other page as may replace
that page on that service) ("Moneyline Telerate Page 56") or page
57 (or any other page as may replace that page on that service)
("Moneyline Telerate Page 57"); or (2) if the rate referred to in
clause (1) is not so published by 3:00 P.M., New York City time,
on the related Funding Note Calculation Date, the Bond Equivalent
Yield (as defined below) of the rate for the applicable Treasury
Bills as published in H.15 Daily Update, or another recognized
electronic source used for the purpose of displaying the
applicable rate, under the caption "U.S. Government
Securities/Treasury Bills/Auction High"; or (3) if the rate
referred to in clause (2) is not so published by 3:00 P.M., New
York City time, on the related Funding
14
Note Calculation Date, the Bond Equivalent Yield of the auction
rate of the applicable Treasury Bills as announced by the United
States Department of the Treasury; or (4) if the rate referred to
in clause (3) is not so announced by the United States Department
of the Treasury, or if the Auction is not held, the Bond
Equivalent Yield of the rate on the particular Interest
Determination Date of the applicable Treasury Bills as published
in H.15(519) under the caption "U.S. Government
Securities/Treasury Bills/Secondary Market"; or (5) if the rate
referred to in clause (4) is not so published by 3:00 P.M., New
York City time, on the related Funding Note Calculation Date, the
rate on the particular Interest Determination Date of the
applicable Treasury Bills as published in H.15 Daily Update, or
another recognized electronic source used for the purpose of
displaying the applicable rate, under the caption "U.S.
Government Securities/Treasury Bills/Secondary Market"; or (6) if
the rate referred to in clause (5) is not so published by 3:00
P.M., New York City time, on the related Funding Note Calculation
Date, the rate on the particular Interest Determination Date
calculated by the Funding Note Calculation Agent as the Bond
Equivalent Yield of the arithmetic mean of the secondary market
bid rates, as of approximately 3:30 P.M., New York City time, on
that Interest Determination Date, of three primary United States
government securities dealers (which may include the Agents or
their affiliates) selected by the Funding Note Calculation Agent,
for the issue of Treasury Bills with a remaining maturity closest
to the Index Maturity specified on the face hereof; or (7) if the
dealers so selected by the Funding Note Calculation Agent are not
quoting as mentioned in clause (6), the Treasury Rate in effect
on the particular Interest Determination Date; provided that if
no Treasury Rate is then in effect, the interest rate that will
be effective as of the next Interest Reset Date will be the
Initial Interest Rate.
"Bond Equivalent Yield" means a yield (expressed as a percentage)
calculated in accordance with the following formula:
Bond Equivalent Yield = D x N x 100
----------------------
360 - (D x M)
where "D" refers to the applicable per annum rate for Treasury
Bills quoted on a bank discount basis and expressed as a decimal,
"N" refers to 365 or 366, as the case may be, and "M" refers to
the actual number of days in the applicable Interest Period.
The "Treasury Rate Determination Date" for each Interest Reset
Date means the day in the week in which the related Interest
Reset Date falls on which day Treasury Bills are normally
auctioned (i.e., Treasury Bills are normally sold at auction on
Monday of each week, unless that day is a legal holiday, in which
case the auction is normally held on the following Tuesday,
except that the auction may be held on the preceding Friday);
provided, however, that if an auction is held on the Friday of
the week preceding the related Interest Reset Date, the Interest
Determination Date will be the preceding Friday.
(J) Regular Floating Rate Note. Unless the Funding Note is designated as a
Floating Rate/Fixed Rate Note or as having an Addendum attached or
having other/additional provisions apply, in each case relating to a
different interest rate formula, such Note that bears interest at
floating rates will be a Regular Floating Rate Note and will bear
interest at the rate determined by reference to the applicable
Interest Rate Basis or Bases plus or minus the applicable Spread, if
any, and/or multiplied by the applicable Spread Multiplier, if any.
Commencing on the first Interest Reset Date, as specified on the face
hereof, the rate at which interest on a Regular Floating Rate Note is
payable will be reset as of each Interest Reset Date; provided,
however, that the interest rate in effect for the period, if any, from
the date of issue to the first Interest Reset Date will be the Initial
Interest Rate.
(K) Floating Rate/Fixed Rate Note. If the Funding Note is designated as a
"Floating Rate/Fixed Rate Note" on the face hereof, such Note that
bears interest at floating rates will bear interest at the rate
determined by reference to the applicable Interest Rate Basis or Bases
plus or minus the applicable
15
Spread, if any, and/or multiplied by the applicable Spread Multiplier,
if any. Commencing on the first Interest Reset Date, the rate at which
interest on a Floating Rate/Fixed Rate Note is payable will be reset
as of each Interest Reset Date; provided, however, that the interest
rate in effect for the period, if any, from the date of issue to the
first Interest Reset Date will be the Initial Interest Rate, as
specified on the face hereof; and the interest rate in effect
commencing on the Fixed Rate Commencement Date will be the Fixed
Interest Rate, if specified on the face hereof, or, if not so
specified, the interest rate in effect on the day immediately
preceding the Fixed Rate Commencement Date.
SECTION 4. Optional Redemption. If any Initial Redemption Date is specified
on the face hereof, Global Funding may redeem the Funding Note prior to the
Stated Maturity Date at its option on any Business Day on or after the Date
Initial Redemption in whole or from time to time in part in increments of $1,000
or any other integral multiple of an authorized denomination specified on the
face hereof at the applicable Redemption Price (as defined below) together with
any unpaid interest accrued on the Funding Note, any Additional Amounts and
other amounts payable with respect thereto, as of the Redemption Date. Unless
otherwise specified in the Funding Note Indenture or on the face hereof, Global
Funding shall give a notice of such redemption to the Holder of any portion of
the Funding Note to be redeemed not more than 60 nor less than 30 days prior to
the Redemption Date. "Redemption Price" means an amount equal to the Initial
Redemption Percentage specified on the face hereof (as adjusted by the Annual
Redemption Percentage Reduction, if applicable) multiplied by the unpaid
principal amount of the Funding Note to be redeemed. The Initial Redemption
Percentage, if any, shall decline at each anniversary of the Initial Redemption
Date by an amount equal to the applicable Annual Redemption Percentage
Reduction, if any, until the Redemption Price is equal to 100% of the unpaid
amount the Funding Note to be redeemed.
SECTION 5. Sinking Fund. Unless otherwise specified on the face hereof, the
Funding Note will not be subject to, or entitled to the benefit of, any sinking
fund.
SECTION 6. Modifications and Amendments. The Funding Note Indenture
contains provisions permitting Global Funding and the Funding Note Indenture
Trustee (1) without the consent of any Holder, to execute Supplemental Funding
Note Indentures for limited purposes and take other actions set forth in the
Funding Note Indenture, and (2) with the consent of the Holder or Holders of not
less than 66(2)/3% of the outstanding principal amount of the Funding Note,
evidenced as provided in the Funding Note Indenture, to execute Supplemental
Funding Note Indentures adding any provisions to or changing in any manner or
eliminating any of the provisions of the Funding Note Indenture or any
Supplemental Funding Note Indenture or modifying in any manner the rights of the
Holder or Holders of the Funding Note subject to specified limitations.
SECTION 7. Obligations Unconditional. No reference herein to the Funding
Note Indenture and no provision of the Funding Note or of the Funding Note
Indenture shall alter or impair the obligation of Global Funding, which is
absolute and unconditional, to pay the principal of, interest on, or any other
amount due and owing with respect to, the Funding Note at the places, at the
respective times, at the rate, and in the coin or currency, herein prescribed.
SECTION 8. Collateral. Pursuant to the Funding Note Indenture, Global
Funding will grant a security interest in, pledge and collaterally assign the
Collateral specified on the face hereof to the Funding Note Indenture Trustee.
The Funding Note will be secured by the Security Interest in the Collateral in
favor of the Funding Note Indenture Trustee for the benefit of each Holder of
the Funding Note and each other person for whose benefit the Funding Note
Indenture Trustee is or will be holding the Collateral (the "Secured Parties").
SECTION 9. Security; Limited Recourse. The Funding Note is solely the
obligation of Global Funding, and will not be guaranteed by any person,
including but not limited to the Funding Agreement Provider, any Allstate Life
Global Funding Trust, any Agent, the Global Funding Trust Beneficial Owner, the
Delaware Trustee, the Funding Note Indenture Trustee or any of their affiliates.
Global Funding's obligations under the Funding Note will be secured by all of
Global Funding's rights and title in one or more Funding Agreement(s) issued by
the Funding Agreement Provider and other rights and assets included in the
applicable Collateral. The Holder or Holders of the Funding Note have no direct
contractual rights against the Funding Agreement Provider under the Funding
Agreement(s). Under the terms of each Funding Agreement, recourse rights to the
Funding Agreement Provider will belong to Global Funding, its successors and
permitted assignees. Global Funding has pledged and collaterally
16
assigned each Funding Agreement to the Funding Note Indenture Trustee and has
granted the Security Interest in the Collateral to the Funding Note Indenture
Trustee for the benefit of the Secured Parties. Recourse to the Funding
Agreement Provider under each Funding Agreement will be enforceable only by the
Funding Note Indenture Trustee on behalf of the Secured Parties.
SECTION 10. Events of Default. If one or more Events of Default, as defined
in the Funding Note Indenture, shall have occurred and be continuing with
respect to the Funding Note, then, and in every such event, unless the principal
of the Funding Note shall have already become due and payable, the entire
principal and premium (if any) of the Funding Note, any interest accrued
thereon, and any Additional Amounts due and owing and any other amounts payable
with respect thereto, may be declared to be, and upon any such declaration the
same shall become immediately, due and payable; provided that, with respect to
certain Events of Default, without any notice to Global Funding or any other act
by the Funding Note Indenture Trustee or any Holder of the Funding Note, the
entire principal and premium (if any) of the Funding Note, any interest accrued
thereon, and any Additional Amounts due and owing, and any other amounts payable
with respect thereto, shall become immediately due and payable without
presentment, demand, protest or other notice of any kind. If the Funding Note is
a Discount Note, the amount of principal of the Funding Note that becomes due
and payable upon such acceleration shall be equal to the amount calculated as
set forth in Section 3 hereof.
SECTION 11. Withholding; Additional Amounts. All amounts due in respect of
the Funding Note will be made without withholding or deduction for or on account
of any present or future taxes, duties, levies, assessments or other
governmental charges of whatever nature imposed or levied by or on behalf of any
governmental authority in the United States having the power to tax payments on
the Funding Note unless the withholding or deduction is required by law. Unless
otherwise specified on the face hereof, Global Funding will not pay any
Additional Amounts to the Holders of the Funding Note in the event that any
withholding or deduction is so required by law, regulation or official
interpretation thereof, and the imposition of a requirement to make any such
withholding or deduction will not give rise to any independent right or
obligation to redeem or repay the Funding Note and shall not constitute an Event
of Default.
SECTION 12. Listing. Unless otherwise specified on the face hereof, the
Funding Note will not be listed on any securities exchange.
SECTION 13. No Recourse. Notwithstanding anything to the contrary contained
in the Funding Note Indenture, or the Funding Note Certificate or Supplemental
Funding Note Indenture, none of the Funding Agreement Provider, its officers,
directors, affiliates, employees or agents, or any of the Delaware Trustee, the
Funding Note Indenture Trustee or the Global Funding Trust Beneficial Owner, or
any of their officers, directors, affiliates, employees or agents (the
"Non-recourse Parties") will be personally liable for the payment of any
principal, interest or any other sums at any time owing under the terms of the
Funding Note. If any Event of Default shall occur with respect to the Funding
Note, the right of the Holders of the Funding Note and the Funding Note
Indenture Trustee on behalf of such Holders in connection with a claim on the
Funding Note shall be limited solely to a proceeding against the Collateral.
Neither the Holders nor the Funding Note Indenture Trustee on behalf of the
Holders will have the right to proceed against the Non-recourse Parties to
enforce the Funding Note (except that to the extent they exercise their rights,
if any, to seize the relevant Funding Agreement, they may enforce the relevant
Funding Agreement against the Funding Agreement Provider) or for any deficiency
judgment remaining after foreclosure of any property included in the Collateral.
SECTION 14. Governing Law. Pursuant to Section 5-1401 of the General
Obligations Law of the State of New York, the Funding Note shall be governed by,
and construed in accordance with, the laws of the State of New York.
17
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto Please Insert Social Security or Other Identifying Number of
Assignee
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE
the within Security of ALLSTATE LIFE GLOBAL FUNDING and does hereby irrevocably
constitute and appoint attorney to transfer said Security on the books of the
Issuer, with full power of substitution in the premises.
Dated:
NOTICE: The signature to this assignment must correspond with the name as
written upon the face of the within instrument in every particular, without
alteration or enlargement or any change whatsoever.
18
EXHIBIT 10.3
FORM OF SECURITY FOR
FUNDING NOTE RELATED TO SECURED MEDIUM TERM NOTES ISSUES UNDER THE
SECURED MEDIUM TERM NOTES PROGRAM
[FACE OF SECURITY]
CUSIP No.:
ALLSTATE LIFE GLOBAL FUNDING
FUNDING NOTE
Title of Funding Note: Stated Maturity Date:
Trust: Securities Exchange Listing: [ ] Yes [ ] No. If yes,
indicate name(s) of Securities Exchange(s):
Principal Amount: $
(or principal amount of foreign or composite
currency)
Original Issue Date:
Issue Price:
Interest Rate or Formula:
Fixed Rate Note: [ ] Yes [ ] No. If yes, Floating Rate Note: [ ] Yes [ ] No. If yes,
Interest Rate: Regular Floating Rate Note: [ ]
Interest Payment Dates: Floating Rate/Fixed Rate Note: [ ]
Day Count Convention: Inverse Floating Rate Note: [ ]
Additional/Other Terms: Interest Rate:
Amortizing Note: [ ] Yes [ ] No. If yes, Interest Rate Basis(es):
Amortization Schedule: CD Rate [ ]
Additional/Other Terms: CMT Rate [ ]
Discount Note: [ ] Yes [ ] No. If yes, Commercial Paper Rate [ ]
Total Amount of Discount: Constant Maturity Swap Rate [ ]
Initial Accrual Period of Discount: Eleventh District Cost of Funds Rate [ ]
Interest Payment Dates: Federal Funds Open Rate [ ]
Additional/Other Terms: Federal Funds Rate [ ]
Redemption Provisions: [ ] Yes [ ] No. If yes, LIBOR [ ]
Initial Redemption Date: EURIBOR [ ]
Initial Redemption Percentage: Prime Rate [ ]
Annual Redemption Percentage Reduction, Treasury Rate [ ]
if any: If LIBOR:
Additional/Other Terms: [ ] LIBOR Moneyline Telerate:
Repayment Provisions: [ ] Yes [ ] No. If yes, [ ] LIBOR Reuters:
Optional Repayment Date(s): LIBOR Currency:
Optional Repayment Price: If CMT Rate:
Additional/Other Terms: Designated CMT MoneylineTelerate Page:
Regular Interest Record Date(s): If CMT MoneylineTelerate Page 7052:
Sinking Fund, if any: [ ] Weekly Average
Specified Currency: [ ] Monthly Average
Exchange Rate Agent: Designated CMT Maturity Index:
Funding Note Calculation Agent: Index Maturity:
Authorized Denominations: Spread (+/-), if any:
Collateral: The right, title and interest of the Trust in and
to: Spread Multiplier, if any:
(i) Allstate Life Insurance Company Funding Initial Interest Rate, if any:
Agreement No(s). [ ]; (ii) all proceeds in respect of such Initial Interest Reset Date:
Funding Agreement(s); and (iii) all books and records Interest Reset Dates:
(including, without limitation, computer programs, Interest Determination Date(s):
printouts, and other computer materials and files) Interest Payment Dates:
pertaining to such Funding Agreement(s). Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Additional Amounts to be Paid for Withholding Tax:
[ ] Yes [ ] No Fixed Rate Commencement Date, if any:
Floating Interest Rate, if any:
Fixed Interest Rate, if any:
Day Count Convention:
Additional/Other Terms:
This note certificate (the "Funding Note Certificate") represents a duly
authorized funding note (the "Funding Note") of Allstate Life Global Funding, a
statutory trust organized under the laws of the State of Delaware ("Global
Funding"). The Funding Note is being issued in connection with the issuance and
sale by the trust specified above (the "Trust") of the trust notes identified on
Annex A to that certain series instrument to which Global Funding and the Trust
are parties (the "Series Instrument") (the "Trust Notes"). The Funding Note is
being issued under the Funding Note Indenture, effective as of the date hereof
(as amended or supplemented from time to time, the "Funding Note Indenture")
among Global Funding and the other persons specified therein. Capitalized terms
used herein and not otherwise defined shall have the respective meanings
ascribed in the Standard Funding Note Indenture Terms, which are incorporated by
reference in and form a part of the Funding Note Indenture (as amended or
supplemented from time to time, the "Standard Funding Note Indenture Terms").
Subject to the immediately following paragraph, Global Funding, for value
received, hereby promises to pay to the Holder or Holders of the Funding Note on
the Maturity Date (as defined below) (or on the date of redemption or repayment
by Global Funding) the principal amount of the Funding Note and, if so specified
above, to pay interest from time to time on the Funding Note from the Original
Issue Date specified above (the "Original Issue Date") or from the most recent
Interest Payment Date to which interest has been paid or duly provided for at
the rate per annum determined in accordance with the provisions on the reverse
hereof and as specified above, until the principal of the Funding Note is paid
or made available for payment and to pay such other amounts due and owing with
respect to the Funding Note.
This Funding Note Certificate shall be surrendered for cancellation by or
on behalf of the Trust, and shall be cancelled by the Funding Note Indenture
Trustee, immediately upon the assignment by Global Funding to, or as directed
by, the Trust of each funding agreement identified on Exhibit A to the Closing
Instrument (each, a "Funding Agreement") in accordance with the terms of the
Funding Note and the Coordination Agreement, and such cancellation shall operate
as a redemption and satisfaction of the Funding Note.
On any exchange or purchase and cancellation of the Funding Note, details
of such exchange or purchase and cancellation shall be entered in the records of
Global Funding. Upon any such exchange or purchase and cancellation, the
principal amount of the Funding Note shall be charged by the principal amount so
exchanged or purchased and cancelled, as provided in the Standard Funding Note
Indenture Terms.
2
Unless otherwise set forth above, if the Funding Note is subject to an
Annual Redemption Percentage Reduction as specified above, the Redemption Price
of the portion of the Funding Note represented by this Funding Note Certificate
shall initially be the Initial Redemption Percentage of the principal amount of
the portion of the Funding Note represented by this Funding Note Certificate on
the Initial Redemption Date and shall decline at each anniversary of the Initial
Redemption Date (each such date, a "Redemption Date") by the Annual Redemption
Percentage Reduction of such principal amount until the Redemption Price is 100%
of such principal amount.
The Funding Note will mature on the earlier of the Stated Maturity Date and
the Maturity Date (as defined in the Trust Notes) of the Trust Notes (the "Trust
Notes Maturity Date"), unless its principal (or, any installment of its
principal) becomes due and payable prior to any such date, whether, as
applicable, by the declaration of acceleration of maturity, notice of redemption
at the option of Global Funding, notice of the Holder's option to elect
repayment or otherwise (the Stated Maturity Date, the Trust Notes Maturity Date
or any date prior to any such date on which the Funding Note becomes due and
payable, as the case may be, are referred to as the "Maturity Date" with respect
to principal of the Funding Note repayable on such date).
Unless otherwise provided above and except as provided in the following
paragraph, Global Funding will pay interest on each Interest Payment Date
specified above, commencing with the first Interest Payment Date next succeeding
the Original Issue Date, and on the Maturity Date; provided that any payment of
principal, premium, if any, interest or other amounts to be made in accordance
with the provisions set forth on the reverse hereof.
Unless otherwise specified above, the interest payable on each Interest
Payment Date or on the Maturity Date will be the amount equal to the interest
accrued from and including the immediately preceding Interest Payment Date in
respect of which interest has been paid or from and including the date of issue,
if no interest has been paid, to but excluding the applicable Interest Payment
Date or the Maturity Date, as the case may be (each, an "Interest Period").
Reference is hereby made to the further provisions of the Funding Note set
forth on the reverse hereof and, if so specified on the face hereof, in an
Addendum hereto, which further provisions shall for all purposes have the same
force and effect as if set forth on the face hereof.
Notwithstanding the foregoing, if an Addendum is attached hereto or
"Other/Additional Provisions" apply to the Funding Note as specified above, the
Funding Note shall be subject to the terms set forth in such Addendum or such
"Other/Additional Provisions."
The Funding Note or the portion thereof represented by this Funding Note
Certificate shall not be valid or become obligatory for any purpose until the
certificate of authentication hereon shall have been executed by the Funding
Note Indenture Trustee pursuant to the Funding Note Indenture.
3
IN WITNESS WHEREOF, Global Funding has caused this instrument to be
duly executed on its behalf.
Dated: Original Issue Date ALLSTATE LIFE GLOBAL FUNDING,
as Issuer
By:
--------------------------------------------
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This Funding Note Certificate is one of the Funding Note Certificates
representing the Funding Note described in the within-mentioned Funding Note
Indenture.
Dated: Original Issue Date [J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION],
as Funding Note Indenture Trustee
By:
-------------------------------------------
Authorized Signatory
4
[REVERSE OF DEFINITIVE SECURITY]
SECTION 1. General. This Funding Note is being issued pursuant to the
Funding Note Indenture in connection with the issuance and sale by the Trust of
the Trust Notes. The Funding Note shall be surrendered for cancellation by or on
behalf of the Trust, and shall be cancelled by the Funding Note Indenture
Trustee, immediately upon the assignment by Global Funding to, or as directed
by, the Trust of each Funding Agreement, and such cancellation shall operate as
a redemption of the Funding Note.
SECTION 2. Currency. The Funding Note is denominated in, and payments of
principal of, premium, if any, and interest on, if any, and other amounts in
respect of, the Funding Note will be in the Specified Currency designated on the
face hereof. If the specified currency of the Funding Note is other than U.S.
Dollars (or "Foreign Currency Note"), any amounts so payable by Global Funding
in the Specified Currency will be converted by the exchange rate agent
designated on the face hereof (the "Exchange Rate Agent") into United States
dollars for payment to the registered holders hereof unless otherwise specified
on the face hereof or a registered holder elects, in the manner described below,
to receive payments in the Specified Currency.
If the Specified Currency for a Foreign Currency Note is not available for
any required payment of principal, premium, if any, and/or interest, if any, due
to the imposition of exchange controls or other circumstances beyond the control
of Global Funding, Global Funding will be entitled to satisfy the obligations to
the registered holders of the Foreign Currency Note by making payments in United
States dollars based on the highest bid quotation in The City of New York
received by the Exchange Rate Agent at approximately 11:00 A.M., New York City
time, on the second Business Day preceding the applicable payment date from
three recognized foreign exchange dealers (one of whom may be the Exchange Rate
Agent) selected by the Exchange Rate Agent and approved by Global Funding for
the purchase by the quoting dealer of the Specified Currency for United States
dollars for settlement on that payment date in the aggregate amount of the
Specified Currency payable to all registered holders of the Foreign Currency
Note scheduled to receive United States dollar payments and at which the
applicable dealer commits to execute a contract. All currency exchange costs
will be borne by the relevant registered holders of the Foreign Currency Note by
deductions from any payments. If three bid quotations are not available,
payments will be made in the Specified Currency.
Registered holders of a Foreign Currency Note may elect to receive all or a
specified portion of any payment of principal, premium, if any, and/or interest,
if any, in the Specified Currency by submitting a written request to the Funding
Note Indenture Trustee at its corporate trust office in The City of New York on
or prior to the applicable Regular Interest Record Date or at least fifteen
calendar days prior to the Maturity Date, as the case may be. This written
request may be mailed or hand delivered or sent by cable, telex or other form of
facsimile transmission. This election will remain in effect until revoked by
written notice delivered to the Funding Note Indenture Trustee on or prior to a
Regular Interest Record Date or at least fifteen calendar days prior to the
Maturity Date, as the case may be. Registered holders of a Foreign Currency Note
to be held in the name of a broker or nominee should contact their broker or
nominee to determine whether and how an election to receive payments in the
Specified Currency may be made.
Unless otherwise specified on the face hereof, if the Specified Currency is
other than United States dollars, if the Holder hereof elects to receive
payments of principal, premium, if any, and/or interest, if any, in the
Specified Currency, the Holder must notify the Funding Note Indenture Trustee of
that election on or prior to the fifth Business Day after the applicable Regular
Interest Record Date or at least ten calendar days prior to the Maturity Date,
as the case may be. If complete instructions are received by the Funding Note
Indenture Trustee on or prior to such dates, then the Holder will receive
payments in the Specified Currency.
Unless otherwise specified on the face hereof, if payment in the Specified
Currency hereon is not available to Global Funding for any required payment of
principal, premium, if any, and/or interest, if any, due to the imposition of
exchange controls or other circumstances beyond Global Funding's control, then
Global Funding will be entitled to satisfy its obligations by making payments in
United States dollars on the basis of the Market Exchange Rate, computed by the
Exchange Rate Agent as described above, on the second Business Day prior to the
particular payment or, if the Market Exchange Rate is not then available, on the
basis of the most recently available Market Exchange Rate. The "Market Exchange
Rate" for a Specified Currency other than United States dollars means the noon
dollar buying rate in The City of New York for cable transfers for the Specified
Currency as certified for customs purposes (or, if not so certified, as
otherwise determined) by the Federal Reserve Bank of New York. Any payment in
5
respect hereof made under such circumstances in U.S. Dollars will not constitute
an Event of Default under the Funding Note Indenture.
In the event that a member state of the European Union in whose national
currency the Funding Note is denominated becomes a participant member in the
third stage of the European economic and monetary union, Global Funding may on
or after the date of such occurrence, without the consent of any Holder hereof,
redenominate all, but not less than all, of the Principal amount of the Funding
Note represented hereby.
All determinations referred to above made by the Exchange Rate Agent shall
be at its sole discretion and, in the absence of manifest error, shall be
conclusive for all purposes and binding on any Holder hereof.
All currency exchange costs will be borne by the Holder hereof by deduction
from the payments made hereon.
SECTION 3. Determination of Interest Rate and Other Payment Provisions.
Fixed Rate Note. If the Funding Note is designated on the face hereof as a
"Fixed Rate Note," the Funding Note will bear interest from the Original Issue
Date until the Maturity Date. Unless otherwise specified on the face hereof, the
rate of interest payable on the Funding Note will not be adjusted; unless
otherwise specified on the face hereof, interest will be payable on the Interest
Payment Dates set forth on the face hereof and at the Maturity Date. Interest
will be computed on the basis of a 360-day year of twelve 30-day months. If any
Interest Payment Date or the Maturity Date of a Fixed Rate Note falls on a day
that is not a Business Day, any payments of principal, premium, if any, and/or
interest or other amounts required to be made, will be made on the next
succeeding Business Day, and no additional interest will accrue in respect of
the payment made on that next succeeding Business Day.
Discount Note. If the Funding Note is designated on the face hereof as a
"Discount Note" (as defined below), payments in respect of the Funding Note
shall be made as set forth on the face hereof. In the event a Discount Note is
redeemed, repaid or accelerated, the amount payable to the Holder of the
Discount Note will be equal to the sum of: (1) the Issue Price (increased by any
accruals of discount) and, in the event of any redemption of the Discount Note,
if applicable, multiplied by the Initial Redemption Percentage (as adjusted by
the Annual Redemption Percentage Reduction, if applicable); and (2) any unpaid
interest accrued on the Discount Note to the date of redemption, repayment or
acceleration of maturity, as applicable. For purposes of determining the amount
of discount that has accrued as of any date on which a redemption, repayment or
acceleration of maturity of the Funding Note occurs for a Discount Note, the
discount will be accrued using a constant yield method. The constant yield will
be calculated using a 30-day month, 360-day year convention, a compounding
period that, except for the Initial Period (as defined below), corresponds to
the shortest period between Interest Payment Dates for a Discount Note (with
ratable accruals within a compounding period), a coupon rate equal to the
initial coupon rate applicable to a Discount Note and an assumption that the
maturity of such Discount Note will not be accelerated. If the period from the
date of issue to the first Interest Payment Date for a Discount Note (the
"Initial Period") is shorter than the compounding period for such Discount Note,
a proportionate amount of the yield for an entire compounding period will be
accrued. If the Initial Period is longer than the compounding period, then the
period will be divided into a regular compounding period and a short period with
the short period being treated as provided in the preceding sentence. The
accrual of the applicable discount may differ from the accrual of original issue
discount for purposes of the Code, certain Discount Notes may not be treated as
having original issue discount within the meaning of the Code, and certain
Funding Notes other than Discount Notes may be treated as issued with original
issue discount for federal income tax purposes. The Funding Note is a "Discount
Note" if its Issue Price is less than 100% of the principal amount thereof by
more than a percentage equal to the product of 0.25% and the number of full
years to the Stated Maturity Date. A Discount Note may not bear any interest
currently or may bear interest at a rate that is below market rates at the time
of issuance.
Amortizing Note. If the Funding Note is specified on the face hereof as an
"Amortizing Note," the Funding Note shall bear interest at the rate set forth on
the face hereof, and payments of principal and interest shall be made as set
forth on the face hereof and/or in accordance with SCHEDULE I attached hereto.
Unless otherwise specified on the face hereof, interest on the Funding Note will
be computed on the basis of a 360-day year of twelve 30-day months. Payments
with respect to an Amortizing Note will be applied first to interest due and
payable on the Funding Note and then to the reduction of the unpaid principal
amount of the Funding Note.
Floating Rate Note. If the Funding Note is specified on the face hereof as
a "Floating Rate Note," interest on the Funding Note shall accrue and be payable
in accordance with this Section 3. A Floating Rate Note may be a CD Rate Note,
CMT Rate Note, Commercial Paper Rate Note, Constant Maturity Swap Rate Note,
6
Eleventh District Cost of Funds Rate Note, Federal Funds Open Rate Note, Federal
Funds Rate Note, LIBOR Note, EURIBOR Note, Prime Rate Note or Treasury Rate
Note. If the Funding Note is designated on the face hereof as a Floating Rate
Note, the face hereof will specify whether the Funding Note is a Regular
Floating Rate Note, Inverse Floating Rate Note or Floating Rate/Fixed Rate Note.
For the period from the date of issue to, but not including, the first Interest
Reset Date set forth on the face hereof, the interest rate hereon shall be the
Initial Interest Rate specified on the face hereof. Thereafter, the interest
rate hereon will be reset as of and be effective as of each Interest Reset Date.
(A) If any Interest Reset Date would otherwise be a day that is not a
Business Day, such Interest Reset Date shall be postponed to the next
day that is a Business Day; provided, however, that if the Funding
Note is a LIBOR Note or a EURIBOR Note and such Business Day is in the
next succeeding calendar month, such Interest Reset Date shall be the
Business Day immediately preceding such Interest Reset Date.
(B) Unless specified otherwise on the face hereof, Interest Reset Dates
are as follows: (1) if the Funding Note resets daily, each Business
Day; (2) if the Funding Note resets weekly, other than Treasury Rate
Note, the Wednesday of each week; (3) if the Funding Note is a
Treasury Rate Note that resets weekly, and except as provided below
under "Treasury Rate Note," the Tuesday of each week; (4) if the
Funding Note resets monthly, the third Wednesday of each month, unless
the Eleventh District Cost of Funds Rate is the Interest Rate Basis
(as defined below) applicable to the Funding Note, in which case the
Funding Note will reset the first calendar day of the month; (5) if
the Funding Note resets quarterly, the third Wednesday of every third
calendar month, beginning in the third calendar month following the
month in which the Notes were issued; (6) if the Funding Note resets
semiannually, the third Wednesday of each of the two months specified
on the face hereof; and (7) if the Funding Note resets annually, the
third Wednesday of the month specified on the face hereof; provided,
however, that with respect to a Floating Rate/Fixed Rate Note, the
rate of interest thereon will not reset after the particular Fixed
Rate Commencement Date specified on the face hereof (the "Fixed Rate
Commencement Date").
(C) Accrued interest is calculated by multiplying the principal amount of
the Floating Rate Note by an accrued interest factor. The accrued
interest factor is computed by adding the interest factor calculated
for each day in the particular Interest Period. The interest factor
for each day will be computed by dividing the interest rate applicable
to such day by 360, in the case of a Floating Rate Note as to which
the CD Rate, the Commercial Paper Rate, the Eleventh District Cost of
Funds Rate, the Federal Funds Open Rate, the Federal Funds Rate,
LIBOR, EURIBOR or the Prime Rate is an applicable Interest Rate Basis,
or by the actual number of days in the year, in the case of a Floating
Rate Note as to which the CMT Rate or the Treasury Rate is an
applicable Interest Rate Basis. In the case of a Floating Rate Note as
to which the Constant Maturity Swap Rate is the Interest Rate Basis,
the interest factor will be computed by dividing the number of days in
the interest period by 360 (the number of days to be calculated on the
basis of a year of 360 days with 12 30-day months (unless (i) the last
day of the interest period is the 31st day of a month but the first
day of the interest period is a day other than the 30th or 31st day of
a month, in which case the month that includes that last day shall not
be considered to be shortened to a 30-day month, or (ii) the last day
of the interest period is the last day of the month of February, in
which case the month of February shall not be considered to be
lengthened to a 30-day month)). The interest factor for a Floating
Rate Note as to which the interest rate is calculated with reference
to two or more Interest Rate Bases will be calculated in each period
in the same manner as if only the applicable Interest Rate Basis
specified on the face hereof applied. The interest rate shall be set
forth on the face hereof. For purposes of making the foregoing
calculation, the interest rate in effect on any Interest Reset Date
will be the applicable rate as reset on that date. Unless otherwise
specified on the face hereof, the interest rate that is effective on
the applicable Interest Reset Date will be determined on the
applicable Interest Determination Date and calculated on the
applicable Funding Note Calculation Date (as defined below). "Funding
Note Calculation Date" means the date by which the Funding Note
Calculation Agent designated on the face hereof, is to calculate the
interest rate which will be the earlier of (1) the tenth calendar day
after the particular Interest Determination Date or, if such day is
not a Business Day, the next succeeding Business Day; or (2) the
Business Day immediately preceding the applicable Interest Payment
Date or the Maturity Date, as the case may be.
(D) Unless otherwise specified on the face hereof, all percentages
resulting from any calculation on a Floating Rate Note will be rounded
to the nearest one hundred-thousandth of a percentage point, with five
7
one-millionths of a percentage point rounded upwards. All dollar
amounts used in or resulting from any calculation on a Floating Rate
Note will be rounded, in the case of United States dollars, to the
nearest cent or, in the case of a foreign currency, to the nearest
unit (with one-half cent or unit being rounded upwards).
(E) Unless otherwise specified on the face hereof, if the Funding Note is
designated on the face hereof as a Floating Rate Note, if any Interest
Payment Date (other than the Maturity Date for the Funding Note) would
otherwise be a day that would not be a Business Day, such Interest
Payment Date would be postponed to the next succeeding Business Day;
provided, however, that if the Funding Note is a LIBOR Note or a
EURIBOR Note and such Business Day is in the next succeeding calendar
month, such Interest Payment Date shall be the immediately preceding
Business Day. Unless otherwise specified on the face hereof, if the
Funding Note is designated on the face hereof as a Floating Rate Note,
if the Maturity Date of the Funding Note falls on a day this is not a
Business Day, Global Funding will make the required payment of
principal, premium, if any, and interest or other amounts on the next
succeeding Business Day, and no additional interest will accrue in
respect of the payment made on that next succeeding Business Day.
Unless otherwise specified on the face hereof and except as provided below,
interest will be payable as follows: (1) if the Interest Reset Date for the
Funding Note is daily, weekly or monthly, interest will be payable on the third
Wednesday of each month or on the third Wednesday of every third calendar month,
beginning in the third calendar month following the month in which the Notes
were issued, as specified on the face hereof, (2) if the Interest Reset Date for
the Funding Note is quarterly, interest will be payable on the third Wednesday
of every third calendar month, beginning in the third calendar month following
the month in which the Notes were issued, (3) if the Interest Reset Date for the
Funding Note is semiannually, interest will be payable on the third Wednesday of
each of two months of each year specified on the face hereof, (4) if the
Interest Reset Date for the Funding Note is annually, interest will be payable
on the third Wednesday of the month of each year specified on the face hereof.
In each of these cases, the Maturity Date will also be an Interest Payment Date.
If specified on the face hereof, the Funding Note may have either or both
of a Maximum Interest Rate or Minimum Interest Rate. If a Maximum Interest Rate
is so designated, the interest rate that may accrue during any Interest Period
for a Floating Rate Note cannot ever exceed such Maximum Interest Rate and in
the event that the interest rate on any Interest Reset Date would exceed such
Maximum Interest Rate (as if no Maximum Interest Rate were in effect) then the
interest rate on such Interest Reset Date shall be the Maximum Interest Rate. If
a Minimum Interest Rate is so designated, the interest rate that may accrue
during any Interest Period for a Floating Rate Note cannot ever be less than
such Minimum Interest Rate and in the event that the interest rate on any
Interest Reset Date would be less than such Minimum Interest Rate (as if no
Minimum Interest Rate were in effect) then the interest rate on such Interest
Reset Date shall be the Minimum Interest Rate. Notwithstanding anything to the
contrary contained herein, if the Funding Note is designated on the face hereof
as a Floating Rate Note, the interest rate on the Funding Note shall not exceed
the maximum interest rate permitted by applicable law.
All determinations of interest by the Funding Note Calculation Agent
designated on the face hereof will, in the absence of manifest error, be
conclusive for all purposes and binding on the Holder of the Funding Note and
neither the Funding Note Indenture Trustee nor the Funding Note Calculation
Agent shall have any liability to the Holder of the Funding Note in respect of
any determination, calculation, quote or rate made or provided by the Funding
Note Calculation Agent. Upon request of the Holder of the Funding Note, the
Funding Note Calculation Agent will provide the interest rate then in effect
and, if determined, the interest rate that will become effective on the next
Interest Reset Date with respect to the Funding Note. If the Funding Note
Calculation Agent is incapable or unwilling to act as such or if the Funding
Note Calculation Agent fails duly to establish the interest rate for any
interest accrual period or to calculate the interest amount or any other
requirements, Global Funding will appoint a successor to act as such in its
place. The Funding Note Calculation Agent may not resign its duties until a
successor has been appointed and such successor has accepted its appointment.
Subject to applicable provisions of law and except as specified herein, on
each Interest Reset Date, the rate of interest on the Funding Note on and after
the first Interest Reset Date shall be the interest rate determined in
accordance with the provisions of the heading below which has been designated as
the Interest Rate Basis on the face hereof (the "Interest Rate Basis"), the base
rate, plus or minus the Spread, if any, specified on the face hereof and/or
multiplied by the Spread Multiplier, if any, specified on the face hereof.
(A) CD Rate Note. If the Interest Rate Basis is the CD Rate, the Funding
Note shall be deemed to be a "CD Rate Note". A CD Rate Note will bear
interest at the interest rate calculated with reference to the CD Rate
and the Spread or Spread Multiplier, if any. The Funding Note
Calculation Agent will determine the CD
8
Rate on each Interest Determination Date. The Interest Determination
Date is the second Business Day preceding the related Interest Reset
Date.
"CD Rate" means: (1) the rate on the particular Interest
Determination Date for negotiable United States dollar
certificates of deposit having the Index Maturity specified on
the face hereof as published in H.15(519) (as defined below)
under the caption "CDs (secondary market)"; or (2) if the rate
referred to in clause (1) is not so published by 3:00 P.M., New
York City time, on the related Funding Note Calculation Date, the
rate on the particular Interest Determination Date for negotiable
United States dollar certificates of the particular Index
Maturity as published in the H.15 Daily Update (as defined below)
or other recognized electronic source used for the purpose of
displaying the applicable rate under the heading "CDs (secondary
market)"; or (3) if the rate referred to in clause (2) is not yet
published in either H.15(519) or the H.15 Daily Update by 3:00
P.M., New York City time, on the related Funding Note Calculation
Date, then the CD Rate will be the rate on the particular
Interest Determination Date calculated by the Funding Note
Calculation Agent as the arithmetic mean of the secondary market
offered rates as of 10:00 A.M., New York City time on that
Interest Determination Date of three leading nonbank dealers in
negotiable United States dollar certificates of deposit in The
City of New York (which may include the Agents or their
affiliates) selected by the Funding Note Calculation Agent for
negotiable United States dollar certificates of deposit of major
United States money market banks for negotiable United States
certificates of deposit with a remaining maturity closest to the
particular Index Maturity in an amount that is representative for
a single transaction in that market at that time; or (4) if the
dealers so selected by the Funding Note Calculation Agent are not
quoting as mentioned in clause (3), the CD Rate in effect on the
particular Interest Determination Date; provided that if no CD
Rate is then in effect, the interest rate that will be effective
as of the next Interest Reset Date will be the Initial Interest
Rate.
"H.15(519)" means the weekly statistical release designated as
H.15(519), or any successor publication, published by the Board
of Governors of the Federal Reserve System.
"H.15 Daily Update" means the daily update of H.15(519),
available through the world-wide-web site of the Board of
Governors of the Federal Reserve System at
http://www.federalreserve.gov/releases/H15/update, or any
successor site or publication.
(B) CMT Rate Note. If the Interest Basis is the CMT Rate, the Funding Note
shall be deemed to be a "CMT Rate Note". A CMT Rate Note will bear
interest at the interest rate calculated with reference to the CMT
Rate and the Spread or Spread Multiplier, if any. The Funding Note
Calculation Agent will determine the CMT Rate on each applicable
Interest Determination Date. The applicable Interest Determination
Date is the second Business Day prior to the Interest Reset Date.
"CMT Rate" means: (1) if CMT Moneyline Telerate Page 7051 is
specified on the face hereof: (a) the percentage equal to the
yield for United States Treasury securities at "constant
maturity" having the Index Maturity specified on the face hereof
as published in H.15(519) under the caption "Treasury Constant
Maturities", as the yield is displayed on Moneyline Telerate (or
any successor service) on page 7051 (or any other page as may
replace the specified page on that service) ("Moneyline Telerate
Page 7051"), for the particular Interest Determination Date; or
(b) if the rate referred to in clause (a) does not so appear on
Moneyline Telerate Page 7051, the percentage equal to the yield
for United States Treasury securities at "constant maturity"
having the particular Index Maturity and for the particular
Interest Determination Date as published in H.15(519) under the
caption "Treasury Constant Maturities"; or (c) if the rate
referred to in clause (b) does not so appear in H.15(519), the
rate on the particular Interest Determination Date for the period
of the particular Index Maturity as may then be published by
either the Federal Reserve System Board of Governors or the
United States Department of the Treasury that the Funding Note
Calculation Agent determines to be comparable to the rate which
would otherwise have been published in H.15(519); or (d) if the
rate referred to in clause (c) is not so published, the rate on
the particular Interest Determination Date calculated by the
Funding Note Calculation Agent as a yield to maturity based on
the arithmetic mean of the secondary market bid prices at
approximately
9
3:30 P.M., New York City time, on that Interest Determination
Date of three leading primary United States government securities
dealers in The City of New York (which may include the Agents or
their affiliates) (each, a "Reference Dealer"), selected by the
Funding Note Calculation Agent from five Reference Dealers
selected by the Funding Note Calculation Agent and eliminating
the highest quotation, or, in the event of equality, one of the
highest, and the lowest quotation or, in the event of equality,
one of the lowest, for United States Treasury securities with an
original maturity equal to the particular Index Maturity, a
remaining term to maturity no more than one year shorter than
that Index Maturity and in a principal amount that is
representative for a single transaction in the securities in that
market at that time; or (e) if fewer than five but more than two
of the prices referred to in clause (d) are provided as
requested, the rate on the particular Interest Determination Date
calculated by the Funding Note Calculation Agent based on the
arithmetic mean of the bid prices obtained and neither the
highest nor the lowest of the quotations shall be eliminated; or
(f) if fewer than three prices referred to in clause (d) are
provided as requested, the rate on the particular Interest
Determination Date calculated by the Funding Note Calculation
Agent as a yield to maturity based on the arithmetic mean of the
secondary market bid prices as of approximately 3:30 P.M., New
York City time, on that Interest Determination Date of three
Reference Dealers selected by the Funding Note Calculation Agent
from five Reference Dealers selected by the Funding Note
Calculation Agent and eliminating the highest quotation or, in
the event of equality, one of the highest and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity
greater than the particular Index Maturity, a remaining term to
maturity closest to that Index Maturity and in a principal amount
that is representative for a single transaction in the securities
in that market at that time; or (g) if fewer than five but more
than two prices referred to in clause (f) are provided as
requested, the rate on the particular Interest Determination Date
calculated by the Funding Note Calculation Agent based on the
arithmetic mean of the bid prices obtained and neither the
highest nor the lowest of the quotations will be eliminated; or
(h) if fewer than three prices referred to in clause (f) are
provided as requested, the CMT Rate in effect on the particular
Interest Determination Date; provided that if no CMT Rate is then
in effect, the interest rate that will be effective as of the
next Interest Reset Date will be the Initial Interest Rate; or
(2) if CMT Moneyline Telerate Page 7052 is specified on the face
hereof: (a) the percentage equal to the one-week or one-month, as
specified on the face hereof, average yield for United States
Treasury securities at "constant maturity" having the Index
Maturity specified on the face hereof as published in H.15(519)
opposite the caption "Treasury Constant Maturities", as the yield
is displayed on Moneyline Telerate (or any successor service) (on
page 7052 or any other page as may replace the specified page on
that service) ("Moneyline Telerate Page 7052"), for the week or
month, as applicable, ended immediately preceding the week or
month, as applicable, in which the particular Interest
Determination Date falls; or (b) if the rate referred to in
clause (a) does not so appear on Moneyline Telerate Page 7052,
the percentage equal to the one-week or one-month, as specified
on the face hereof, average yield for United States Treasury
securities at "constant maturity" having the particular Index
Maturity and for the week or month, as applicable, preceding the
particular Interest Determination Date as published in H.15(519)
opposite the caption "Treasury Constant Maturities"; or (c) if
the rate referred to in clause (b) does not so appear in
H.15(519), the one-week or one-month, as specified on the face
hereof, average yield for United States Treasury securities at
"constant maturity" having the particular Index Maturity as
otherwise announced by the Federal Reserve Bank of New York for
the week or month, as applicable, ended immediately preceding the
week or month, as applicable, in which the particular Interest
Determination Date falls; or (d) if the rate referred to in
clause (c) is not so published, the rate on the particular
Interest Determination Date calculated by the Funding Note
Calculation Agent as a yield to maturity based on the arithmetic
mean of the secondary market bid prices at approximately 3:30
P.M., New York City time, on that Interest Determination Date of
three Reference Dealers selected by the Funding Note Calculation
Agent from five Reference Dealers selected by the Funding Note
Calculation Agent and eliminating the highest quotation, or, in
the event of equality, one of the highest, and the lowest
quotation or, in the event of equality, one of the lowest, for
United States Treasury securities with an original maturity equal
to the particular Index Maturity, a remaining term to maturity no
more than one year shorter than that Index Maturity and in a
principal amount that is representative for a single transaction
in the securities in that market at that time; or (e) if fewer
than five but more than two of the prices referred to in clause
10
(d) are provided as requested, the rate on the particular
Interest Determination Date calculated by the Funding Note
Calculation Agent based on the arithmetic mean of the bid prices
obtained and neither the highest nor the lowest of the quotations
shall be eliminated; or (f) if fewer than three prices referred
to in clause (d) are provided as requested, the rate on the
particular Interest Determination Date calculated by the Funding
Note Calculation Agent as a yield to maturity based on the
arithmetic mean of the secondary market bid prices as of
approximately 3:30 P.M., New York City time, on that Interest
Determination Date of three Reference Dealers selected by the
Funding Note Calculation Agent from five Reference Dealers
selected by the Funding Note Calculation Agent and eliminating
the highest quotation or, in the event of equality, one of the
highest and the lowest quotation or, in the event of equality,
one of the lowest, for United States Treasury securities with an
original maturity greater than the particular Index Maturity, a
remaining term to maturity closest to that Index Maturity and in
a principal amount that is representative for a single
transaction in the securities in that market at the time; or (g)
if fewer than five but more than two prices referred to in clause
(f) are provided as requested, the rate on the particular
Interest Determination Date calculated by the Funding Note
Calculation Agent based on the arithmetic mean of the bid prices
obtained and neither the highest nor the lowest of the quotations
will be eliminated; or (h) if fewer than three prices referred to
in clause (f) are provided as requested, the CMT Rate in effect
on that Interest Determination Date; provided that if no CMT Rate
is then in effect, the interest rate that will be effective as of
the next Interest Reset Date will be the Initial Interest Rate.
If two United States Treasury securities with an original
maturity greater than the Index Maturity specified on the face
hereof have remaining terms to maturity equally close to the
particular Index Maturity, the quotes for the United States
Treasury security with the shorter original remaining term to
maturity will be used.
11
(C) Commercial Paper Rate Note. If the Interest Rate Basis is the
Commercial Paper Rate, the Funding Note shall be deemed to be a
"Commercial Paper Rate Note". A Commercial Paper Rate Note will bear
interest for each Interest Reset Date at the interest rate calculated
with reference to the Commercial Paper Rate and the Spread or Spread
Multiplier, if any. The Funding Note Calculation Agent will determine
the Commercial Paper Rate on each applicable Interest Determination
Date. The Interest Determination Date is the second Business Day
preceding the related Interest Reset Date.
"Commercial Paper Rate" means: (1) the Money Market Yield
(calculated as described below) on the Interest Determination
Date of the rate for commercial paper having the applicable Index
Maturity as such rate is published in H.15(519) under the heading
"Commercial Paper--Nonfinancial"; or (2) if the rate referred to
in clause (1) is not published by 3:00 P.M., New York City time,
on the Funding Note Calculation Date pertaining to such Interest
Determination Date, then the Commercial Paper Rate shall be the
Money Market Yield on the particular Interest Determination Date
of the rate for commercial paper having the particular Index
Maturity as published on H.15 Daily Update or such other
recognized electronic source used for the purposes of displaying
the applicable rate, under the caption "Commercial
Paper--Nonfinancial"; or (3) if the rate referred to in clause
(2) is not published by 3:00 P.M., New York City time, on the
Funding Note Calculation Date, then the Commercial Paper Rate as
calculated by the Funding Note Calculation Agent shall be the
Money Market Yield of the arithmetic mean of the offered rates at
approximately 11:00 A.M., New York City time, on that Interest
Determination Date of three leading dealers of United States
dollar commercial paper in The City of New York (which may
include the Agents or their affiliates) selected by the Funding
Note Calculation Agent for commercial paper having the particular
Index Maturity placed for industrial issuers whose bond rating is
"Aa" by Moody's or the equivalent from another nationally
recognized statistical rating organization; or (4) if the dealers
so selected by the Funding Note Calculation Agent are not quoting
as mentioned in clause (3), the Commercial Paper Rate in effect
on the particular Interest Determination Date; provided that if
no Commercial Paper Rate is then in effect, the interest rate
that will be effective as of the next Interest Reset Date will be
the Initial Interest Rate.
"Money Market Yield" shall be a yield (expressed as a percentage)
calculated in accordance with the following formula:
Money Market Yield = D x 360 x 100
------------------------
360 - (D x M)
where "D" refers to the per annum rate for the commercial paper,
quoted on a bank discount basis and expressed as a decimal; and
"M" refers to the actual number of days in the applicable
Interest Period.
(D) Constant Maturity Swap Rate Notes. If the Interest Basis is the
Constant Maturity Swap Rate, the Notes shall be deemed to be "Constant
Maturity Swap Rate Notes." Constant Maturity Swap Rate Notes will bear
interest at the interest rate calculated with reference to the
Constant Maturity Swap Rate and the Spread or Spread Multiplier, if
any. The Funding Note Calculation Agent will determine the Constant
Maturity Swap Rate on each applicable Interest Determination Date. The
Interest Determination Date is the second U.S. Government Securities
Business Day (as defined below) preceding the related Interest Reset
Date; provided, however, that if, after attempting to determine the
Constant Maturity Swap Rate (as described below), such rate is not
determinable for a particular Interest Determination Date (the
"Original Interest Determination Date"), then such Interest
Determination Date shall be the first U.S. Government Securities
Business Day preceding the Original Interest Determination Date for
which the Constant Maturity Swap Rate can be determined as described
below. Constant Maturity Swap Rate" means (1) the rate for U.S. Dollar
swaps with the designated maturity specified on the face hereof,
expressed as a percentage, which appears on the Reuters Screen
ISDAFIX1 Page as of 11:00 A.M., New York City time, on the particular
Interest Determination Date, or (2) if the rate referred to in clause
(1) does not appear on the Reuters Screen ISDAFIX1 Page by 2:00 P.M.,
New York City time, on such Interest Determination Date, a percentage
determined on the basis of the mid-market semi-annual swap rate
quotations provided by the Reference Banks (as defined below) as of
approximately 11:00 A.M., New York City time, on such Interest
12
Determination Date, and, for this purpose, the semi-annual swap rate
means the mean of the bid and offered rates for the semi-annual fixed
leg, calculated on a 30/360 day count basis, of a fixed-for-floating
U.S. Dollar interest rate swap transaction with a term equal to the
designated maturity specified in the face hereof commencing on the
Interest Reset Date and in a Representative Amount (as defined below)
with an acknowledged dealer of good credit in the swap market, where
the floating leg, calculated on an Actual/360 day count basis, is
equivalent to USD-LIBOR-BBA with a designated maturity specified on
the face hereof. The Funding Note Calculation Agent will request the
principal New York City office of each of the Reference Banks to
provide a quotation of its rate. If at least three quotations are
provided, the rate for that Interest Determination Date will be the
arithmetic mean of the quotations, eliminating the highest quotation
(or, in the event of equality, one of the highest) and the lowest
quotation (or, in the event of equality, one of the lowest).
"U.S. Government Securities Business Day" means any day except
for Saturday, Sunday, or a day on which The Bond Market
Association recommends that the fixed income departments of its
members be closed for the entire day for purposes of trading in
U.S. government securities.
"Representative Amount" means an amount that is representative
for a single transaction in the relevant market at the relevant
time.
"Reference Banks" mean five leading swap dealers in the New York
City interbank market, selected by the Funding Note Calculation
Agent, after consultation with Allstate Life.
(E) Eleventh District Cost of Funds Rate Note. If the Interest Basis is
the Eleventh District Costs of Funds Rate, the Funding Note shall be
deemed to be a "Eleventh District Cost of Funds Rate Note". An
Eleventh District Cost of Funds Note will bear interest at the
interest rate calculated with reference to the Eleventh District Cost
of Funds Rate and the Spread or Spread Multiplier, if any. The Funding
Note Calculation Agent will determine the Eleventh District Cost of
Rate on each applicable Interest Determination Date. The applicable
Interest Determination Date is the last working day of the month
immediately preceding the related Interest Reset Date on which the
Federal Home Loan Bank of San Francisco publishes the Eleventh
District Index. The "Eleventh District Cost of Funds Rate" means (1)
the rate equal to the monthly weighted average cost of funds for the
calendar month immediately preceding the month in which the particular
Interest Determination Date falls as set forth under the caption "11th
District" on the display on Moneyline Telerate (or any successor
service) on page 7058 (or any other page as may replace the specified
page on that service) ("Moneyline Telerate Page 7058") as of 11:00
A.M., San Francisco time, on that Interest Determination Date, or (2)
if the rate referred to in clause (1) does not so appear on Moneyline
Telerate Page 7058, the monthly weighted average cost of funds paid by
member institutions of the Eleventh Federal Home Loan Bank District
that was most recently announced (the "Eleventh District Index") by
the Federal Home Loan Bank of San Francisco as the cost of funds for
the calendar month immediately preceding that Interest Determination
Date, or (3) if the Federal Home Loan Bank of San Francisco fails to
announce the Eleventh District Index on or prior to the particular
Interest Determination Date for the calendar month immediately
preceding that Interest Determination Date, the Eleventh District Cost
of Funds Rate in effect on the particular Interest Determination Date;
provided that if no Eleventh District Cost of Funds Rate is then in
effect, the interest rate that will be effective as of the next
Interest Reset Date will be the Initial Interest Rate.
(F) Federal Funds Open Rate Notes. If the Interest Basis is the Federal
Funds Open Rate, the Notes shall be deemed to be "Federal Funds Open
Rate Notes." Federal Funds Open Rate Notes will bear interest at the
interest rate calculated with reference to the Federal Funds Open Rate
and the Spread or Spread Multiplier, if any. The Funding Note
Calculation Agent will determine the Federal Funds Open Rate on each
applicable Interest Determination Date. The Interest Determination
Date is the related Interest Reset Date. "Federal Funds Open Rate"
means the rate set forth on Moneyline Telerate Page 5 for an Interest
Reset Date underneath the caption "FEDERAL FUNDS" in the row titled
"OPEN". If the rate is not available for an Interest Reset Date, the
rate for that Interest Reset Date shall be the Federal Funds Rate as
13
determined below.
(G) Federal Funds Rate Note. If the Interest Rate Basis is the Federal
Funds Rate, the Funding Note shall be deemed to be a "Federal Funds
Rate Note". A Federal Funds Rate Note will bear interest for each
Interest Reset Date at the interest rate calculated with reference to
the Federal Funds Rate and the Spread or Spread Multiplier, if any.
The Funding Note Calculation Agent will determine the Federal Funds
Rate on each applicable Interest Determination Date. The Interest
Determination Date is the Business Day immediately preceding the
related Interest Reset Date. "Federal Funds Rate" means (1) the rate
on the particular Interest Determination Date for United States dollar
federal funds as published in H.15(519) under the caption "Federal
Funds (Effective)" and displayed on Moneyline Telerate (or any
successor service) on page 120 (or any other page as may replace the
specified page on that service) ("Moneyline Telerate Page 120"), or
(2) if the rate referred to in clause (1) does not so appear on
Moneyline Telerate Page 120 or is not so published by 3:00 P.M., New
York City time, on the related Funding Note Calculation Date, the rate
on the particular Interest Determination Date for United States dollar
federal funds as published in H.15 Daily Update, or such other
recognized electronic source used for the purpose of displaying the
applicable rate, under the caption "Federal Funds (Effective)", or (3)
if the rate referred to in clause (2) is not so published by 3:00
P.M., New York City time, on the related Funding Note Calculation
Date, the rate on the particular Interest Determination Date
calculated by the Funding Note Calculation Agent as the arithmetic
mean of the rates for the last transaction in overnight United States
dollar federal funds arranged by three leading brokers of United
States dollar federal funds transactions in The City of New York
(which may include the Agents or their affiliates), selected by the
Funding Note Calculation Agent prior to 9:00 A.M., New York City time,
on that Interest Determination Date, or (4) if the brokers so selected
by the Funding Note Calculation Agent are not quoting as mentioned in
clause (3), the Federal Funds Rate in effect on the particular
Interest Determination Date; provided that if no Federal Funds Rate is
then in effect, the interest rate that will be effective as of the
next Interest Reset Date will be the Initial Interest Rate.
(H) LIBOR Note. If the Interest Rate Basis is LIBOR (as defined below),
the Funding Note shall be deemed to be a "LIBOR Note". A LIBOR Note
will bear interest for each Interest Period at the interest rate
calculated with reference to LIBOR and the Spread or Spread
Multiplier, if any. On each applicable Interest Determination Date the
Funding Note Calculation Agent will determine LIBOR. The applicable
Interest Determination Date is the second London Banking Day preceding
the related Interest Reset Date.
LIBOR means: (1) if "LIBOR Moneyline Telerate" is specified on
the face hereof or if neither "LIBOR Reuters" nor "LIBOR
Moneyline Telerate" is specified on the face hereof as the method
for calculating LIBOR, the rate for deposits in the LIBOR
Currency (as defined below) having the Index Maturity specified
on the face hereof, commencing on the related Interest Reset
Date, that appears on the LIBOR Page (as defined below) as of
11:00 A.M., London time, on the particular Interest Determination
Date, or (2) if "LIBOR Reuters" is specified on the face hereof,
the arithmetic mean of the offered rates, calculated by the
Funding Note Calculation Agent, or the offered rate, if the LIBOR
Page by its terms provides only for a single rate, for deposits
in the LIBOR Currency having the particular Index Maturity,
commencing on the related Interest Reset Date, that appear or
appears, as the case may be, on the LIBOR Page as of 11:00 A.M.,
London time, on the particular Interest Determination Date, or
(3) if fewer than two offered rates appear, or no rate appears,
as the case may be, on the particular Interest Determination Date
on the LIBOR Page as specified in clause (1) or (2), as
applicable, the rate calculated by the Funding Note Calculation
Agent of at least two offered quotations obtained by the Funding
Note Calculation Agent after requesting the principal London
offices of each of four major reference banks (which may include
affiliates of the Agents), in the London interbank market to
provide the Funding Note Calculation Agent with its offered
quotation for deposits in the LIBOR Currency for the period of
the particular Index Maturity, commencing on the related Interest
Reset Date, to prime banks in the London interbank market at
approximately 11:00 A.M., London time, on that Interest
Determination Date and in a principal amount that is
representative for a single transaction in the LIBOR Currency in
that market at that time, or (4) if fewer than two offered
quotations referred to in clause (3) are provided as requested,
the rate calculated by the Funding Note Calculation Agent as the
arithmetic mean of the rates quoted at approximately 11:00 A.M.,
in the applicable Principal Financial Center, on the
14
particular Interest Determination Date by three major banks
(which may include affiliates of the Agents), in that Principal
Financial Center selected by the Funding Note Calculation Agent
for loans in the LIBOR Currency to leading European banks, having
the particular Index Maturity and in a principal amount that is
representative for a single transaction in the LIBOR Currency in
that market at that time, or (5) if the banks so selected by the
Funding Note Calculation Agent are not quoting as mentioned in
clause (4), LIBOR in effect on the particular Interest
Determination Date; provided that if no LIBOR is then in effect,
the interest rate that will be effective as of the next Interest
Reset Date will be the Initial Interest Rate.
"LIBOR Currency" means the currency specified on the face hereof
as to which LIBOR shall be calculated or, if no currency is
specified on the face hereof, United States dollars.
"LIBOR Page" means either: if "LIBOR Reuters" is specified on the
face hereof as the method for calculating LIBOR, the display on
the Reuter Monitor Money Rates Service (or any successor service)
on the page specified on the face hereof (or any other page as
may replace that page on that service) for the purpose of
displaying the London interbank rates of major banks for the
LIBOR Currency; or if "LIBOR Moneyline Telerate" is specified on
the face hereof or neither "LIBOR Reuters" nor "LIBOR Moneyline
Telerate" is specified on the face hereof as the method for
calculating LIBOR, the display on Moneyline Telerate (or any
successor service) on the page specified on the face hereof (or
any other page as may replace such page on such service) for the
purpose of displaying the London interbank rates of major banks
for the LIBOR Currency.
"London Banking Day" means a day on which commercial banks are
open for business (including dealings in the LIBOR Currency) in
London.
(I) EURIBOR Note. If the Interest Rate Basis is EURIBOR (as defined
below), the Funding Note shall be deemed to be a "EURIBOR Note". A
EURIBOR Note will bear interest at the rates (calculated with
references to the European inter-bank offered rate for deposits in
Euro, or "EURIBOR", and the Spread and/or Spread Multiplier, if any)
specified on the face hereof.
"EURIBOR" means, with respect to any Interest Determination Date
relating to a EURIBOR Note or if the Funding Note bears interest
at a floating rate for which the interest rate is determined with
reference to EURIBOR (a "EURIBOR Interest Determination Date"),
the rate for deposits in Euros as sponsored, calculated and
published jointly by the European Banking Federation and ACI--The
Financial Market Association, or any company established by the
joint sponsors for purposes of compiling and publishing those
rates, having the Index Maturity specified on the face hereof,
commencing on the applicable Interest Reset Date, as the rate
appears on Moneyline Telerate, Inc., or any successor service, on
page 248 (or any other page as may replace that specified page on
the service) ("Moneyline Telerate Page 248") as of 11:00 A.M.,
Brussels time, on the applicable EURIBOR Interest Determination
Date. If such rate does not appear on Moneyline Telerate Page
248, or is not so published by 11:00 A.M., Brussels time, on the
applicable EURIBOR Interest Determination Date, such rate will be
calculated by the Funding Note Calculation Agent and will be the
arithmetic mean of at least two quotations obtained by the
Funding Note Calculation Agent after requesting the principal
Euro-zone (as defined below) offices of four major banks in the
Euro-zone interbank market to provide the Funding Note
Calculation Agent with its offered quotation for deposits in
Euros for the period of the Index Maturity specified on the face
hereof, commencing on the applicable Interest Reset Date, to
prime banks in the Euro-zone interbank market at approximately
11:00 A.M., Brussels time, on the applicable EURIBOR Interest
Determination Date and in a principal amount not less than the
equivalent of $1 million in Euros that is representative for a
single transaction in Euro in the market at that time. If fewer
than two such quotations are so provided, the rate on the
applicable EURIBOR Interest Determination Date will be calculated
by the Funding Note Calculation Agent and will be the arithmetic
mean of the rates quoted at approximately 11:00 A.M., Brussels
time, on such EURIBOR Interest Determination Date by four major
banks in the Euro-zone for loans in Euro to leading European
banks, having the
15
Index Maturity specified on the face hereof, commencing on the
applicable Interest Reset Date and in a principal amount not less
than the equivalent of $1 million in Euros that is representative
for a single transaction in Euros in the market at that time. If
the banks so selected by the Funding Note Calculation Agent are
not quoting as mentioned above, EURIBOR will be EURIBOR in effect
on the applicable EURIBOR Interest Determination Date; provided
that if no EURIBOR is then in effect, the interest rate that will
be effective as of the next Interest Reset Date will be the
Initial Interest Rate.
"Euro-zone" means the region comprised of member states of the
European Union that have adopted the single currency in
accordance with the Treaty Establishing the European Community,
as amended by the Treaty on European Union.
(J) Prime Rate Note. If the Interest Rate Basis is the Prime Rate, the
Funding Note shall be deemed to be a "Prime Rate Note". A Prime Rate
Note will bear interest for each Interest Reset Date calculated with
reference to the Prime Rate and the Spread or Spread Multiplier, if
any, subject to the Minimum Interest Rate and/or Maximum Interest
Rate, if any, specified on the face hereof. The Funding Note
Calculation Agent will determine the Prime Rate for each Interest
Reset Date on each applicable Interest Determination Date. The
Interest Determination Date is the Business Day immediately preceding
the related Interest Reset Date. "Prime Rate" means (1) the rate on
the particular Interest Determination Date as published in H.15(519)
under the caption "Bank Prime Loan", or (2) if the rate referred to in
clause (1) is not so published by 3:00 P.M., New York City time, on
the related Funding Note Calculation Date, the rate on the particular
Interest Determination Date as published in H.15 Daily Update, or such
other recognized electronic source used for the purpose of displaying
the applicable rate, under the caption "Bank Prime Loan", or (3) if
the rate referred to in clause (2) is not so published by 3:00 P.M.,
New York City time, on the related Funding Note Calculation Date, the
rate on the particular Interest Determination Date calculated by the
Funding Note Calculation Agent as the arithmetic mean of the rates of
interest publicly announced by each bank that appears on the Reuters
Screen US PRIME 1 Page (as defined below) as the applicable bank's
prime rate or base lending rate as of 11:00 A.M., New York City time,
on that Interest Determination Date, or (4) if fewer than four rates
referred to in clause (3) are so published by 3:00 P.M., New York City
time, on the related Funding Note Calculation Date, the rate on the
particular Interest Determination Date calculated by the Funding Note
Calculation Agent as the arithmetic mean of the prime rates or base
lending rates quoted on the basis of the actual number of days in the
year divided by a 360-day year as of the close of business on that
Interest Determination Date by three major banks (which may include
affiliates of the Agents) in The City of New York selected by the
Funding Note Calculation Agent, or (5) if the banks so selected by the
Funding Note Calculation Agent are not quoting as mentioned in clause
(4), the Prime Rate in effect on the particular Interest Determination
Date; provided that if no Prime Rate is then in effect, the interest
rate that will be effective as of the next Interest Reset Date will be
the Initial Interest Rate. "Reuters Screen US PRIME 1 Page" means the
display on the Reuter Monitor Money Rates Service (or any successor
service) on the "US PRIME 1" page (or any other page as may replace
that page on that service) for the purpose of displaying prime rates
or base lending rates of major United States banks.
(K) Treasury Rate Note. If the Interest Rate Basis is the Treasury Rate,
the Funding Note shall be deemed to be a "Treasury Rate Note". A
Treasury Rate Note will bear interest for each Interest Reset Date at
the interest rate calculated with reference to the Treasury Rate and
the Spread or Spread Multiplier, if any. The Funding Note Calculation
Agent will determine the Treasury Rate on each Treasury Rate
Determination Date (as defined below). "Treasury Rate" means (1) the
rate from the auction held on the Treasury Rate Interest Determination
Date (the "Auction") of direct obligations of the United States
("Treasury Bills") having the Index Maturity specified on the face
hereof under the caption "INVESTMENT RATE" on the display on Moneyline
Telerate (or any successor service) on page 56 (or any other page as
may replace that page on that service) ("Moneyline Telerate Page 56")
or page 57 (or any other page as may replace that page on that
service) ("Moneyline Telerate Page 57"), or (2) if the rate referred
to in clause (1) is not so published by 3:00 P.M., New York City time,
on the related Funding Note Calculation Date, the Bond Equivalent
Yield (as defined below) of the rate for the applicable Treasury Bills
as published in H.15 Daily Update, or another recognized electronic
source used for the purpose of displaying the applicable rate,
16
under the caption "U.S. Government Securities/Treasury Bills/Auction
High", or (3) if the rate referred to in clause (2) is not so
published by 3:00 P.M., New York City time, on the related Funding
Note Calculation Date, the Bond Equivalent Yield of the auction rate
of the applicable Treasury Bills as announced by the United States
Department of the Treasury, or (4) if the rate referred to in clause
(3) is not so announced by the United States Department of the
Treasury, or if the Auction is not held, the Bond Equivalent Yield of
the rate on the particular Interest Determination Date of the
applicable Treasury Bills as published in H.15(519) under the caption
"U.S. Government Securities/Treasury Bills/Secondary Market", or (5)
if the rate referred to in clause (4) is not so published by 3:00
P.M., New York City time, on the related Funding Note Calculation
Date, the rate on the particular Interest Determination Date of the
applicable Treasury Bills as published in H.15 Daily Update, or
another recognized electronic source used for the purpose of
displaying the applicable rate, under the caption "U.S. Government
Securities/Treasury Bills/Secondary Market", or (6) if the rate
referred to in clause (5) is not so published by 3:00 P.M., New York
City time, on the related Funding Note Calculation Date, the rate on
the particular Interest Determination Date calculated by the Funding
Note Calculation Agent as the Bond Equivalent Yield of the arithmetic
mean of the secondary market bid rates, as of approximately 3:30 P.M.,
New York City time, on that Interest Determination Date, of three
primary United States government securities dealers (which may include
the Agents or their affiliates) selected by the Funding Note
Calculation Agent, for the issue of Treasury Bills with a remaining
maturity closest to the Index Maturity specified on the face hereof,
or (7) if the dealers so selected by the Funding Note Calculation
Agent are not quoting as mentioned in clause (6), the Treasury Rate in
effect on the particular Interest Determination Date; provided that if
no Treasury Rate is then in effect, the interest rate that will be
effective as of the next Interest Reset Date will be the Initial
Interest Rate.
"Bond Equivalent Yield" means a yield (expressed as a percentage)
calculated in accordance with the following formula:
Bond Equivalent Yield = D x N x 100
-----------------------
360 - (D x M)
where "D" refers to the applicable per annum rate for Treasury
Bills quoted on a bank discount basis and expressed as a decimal,
"N" refers to 365 or 366, as the case may be, and "M" refers to
the actual number of days in the applicable Interest Period.
The "Treasury Rate Determination Date" for each Interest Reset
Date means the day in the week in which the related Interest
Reset Date falls on which day Treasury Bills are normally
auctioned (i.e., Treasury Bills are normally sold at auction on
Monday of each week, unless that day is a legal holiday, in which
case the auction is normally held on the following Tuesday,
except that the auction may be held on the preceding Friday);
provided, however, that if an auction is held on the Friday of
the week preceding the related Interest Reset Date, the Interest
Determination Date will be the preceding Friday.
(L) Regular Floating Rate Note. Unless the Funding Note is designated as a
Floating Rate/Fixed Rate Note or an Inverse Floating Rate Note, or as
having an Addendum attached or having other/additional provisions
apply, in each case relating to a different interest rate formula, the
Funding Note that bears interest at floating rates will be a Regular
Floating Rate Note and will bear interest at the rate determined by
reference to the applicable Interest Rate Basis or Bases plus or minus
the applicable Spread, if any, and/or multiplied by the applicable
Spread Multiplier, if any. Commencing on the first Interest Reset
Date, as specified on the face hereof, the rate at which interest on a
Regular Floating Rate Note is payable will be reset as of each
Interest Reset Date; provided, however, that the interest rate in
effect for the period, if any, from the date of issue to the first
Interest Reset Date will be the Initial Interest Rate.
(M) Floating Rate/Fixed Rate Note. If the Funding Note is designated as a
"Floating Rate/Fixed Rate Note" on the face hereof, the Funding Note
that bears interest at floating rates will bear interest at the rate
determined by reference to the applicable Interest Rate Basis or Bases
plus or minus the applicable Spread, if any, and/or multiplied by the
applicable Spread Multiplier, if any. Commencing on the first Interest
Reset Date, the rate at which interest on a Floating Rate/Fixed Rate
17
Note is payable will be reset as of each Interest Reset Date;
provided, however, that the interest rate in effect for the period, if
any, from the date of issue to the first Interest Reset Date will be
the Initial Interest Rate, as specified on the face hereof; and the
interest rate in effect commencing on the Fixed Rate Commencement Date
will be the Fixed Interest Rate, if specified on the face hereof, or,
if not so specified, the interest rate in effect on the day
immediately preceding the Fixed Rate Commencement Date.
(N) Inverse Floating Rate Note. If the Funding Note is designated as an
"Inverse Floating Rate Note" on the face hereof, the Inverse Floating
Rate shall be equal to the Fixed Interest Rate minus the rate
determined by reference to the applicable Interest Rate Basis or Bases
plus or minus the applicable Spread, if any, and/or multiplied by the
applicable Spread Multiplier, if any; provided, however, that interest
on an Inverse Floating Rate Note will not be less than zero.
Commencing on the first Interest Reset Date, the rate at which
interest on an Inverse Floating Rate Note is payable will be reset as
of each Interest Reset Date; provided, however, that the interest rate
in effect for the period, if any, from the date of issue to the first
Interest Reset Date will be the Initial Interest Rate.
SECTION 4. Optional Redemption. If any Initial Redemption Date is specified
on the face hereof, Global Funding may redeem the Funding Note prior to the
Stated Maturity Date at its option on any Business Day on or after the Date
Initial Redemption in whole or from time to time in part in increments of $1,000
or any other integral multiple of an authorized denomination specified on the
face hereof at the applicable Redemption Price (as defined below) together with
any unpaid interest accrued on the Funding Note, any Additional Amounts and
other amounts payable with respect thereto, as of the Redemption Date. Unless
otherwise specified in the Funding Note Indenture or on the face hereof, Global
Funding shall give a notice of such redemption to the Holder of any portion of
the Funding Note to be redeemed not more than 60 nor less than 30 days prior to
the Redemption Date. "Redemption Price" means an amount equal to the Initial
Redemption Percentage specified on the face hereof (as adjusted by the Annual
Redemption Percentage Reduction, if applicable) multiplied by the unpaid
principal amount of the Funding Note to be redeemed. The Initial Redemption
Percentage, if any, shall decline at each anniversary of the Initial Redemption
Date by an amount equal to the applicable Annual Redemption Percentage
Reduction, if any, until the Redemption Price is equal to 100% of the unpaid
amount the Funding Note to be redeemed.
SECTION 5. Sinking Funds and Amortizing Note. Unless otherwise specified on
the face hereof or unless the Funding Note is an Amortizing Note, the Funding
Note will not be subject to, or entitled to the benefit of, any sinking fund. If
it is specified on the face hereof that the Funding Note is an Amortizing Note,
Global Funding will make payments combining principal and interest on the dates
and in the amounts set forth in the table appearing in SCHEDULE I, attached to
this Funding Note Certificate. If the Funding Note is an Amortizing Note,
payments made on the Funding Note will be applied first to interest due and
payable on each such payment date and then to the reduction of the unpaid
principal amount.
SECTION 6. Optional Repayment. If so specified on the face hereof, the
Holder or Holders of the Funding Note may require Global Funding to repay the
Funding Note on the Optional Repayment Date(s) specified on the face hereof, in
whole or from time to time, in part, in increments of U.S.$1,000 or any other
integral multiple of an authorized denomination specified on the face hereof
(provided that any remaining principal amount of the Funding Note shall be at
least U.S.$1,000 or any other integral multiple of an authorized denomination
specified on the face hereof), at a repayment price equal to 100% of the unpaid
principal amount of the Funding Note to be repaid, together with unpaid interest
accrued thereon to the Repayment Date (as defined below) and any other amounts
then due and owing. For the Funding Note or any portion thereof to be so repaid,
the Funding Note Indenture Trustee must receive at its Corporate Trust Office
not more than 60 nor less than 30 calendar days prior to the applicable
Repayment Date, a properly completed Option to Elect Repayment form, which is
attached hereto as Annex A, forwarded by the Holder or Holders of the Funding
Note. Exercise of such repayment option shall be irrevocable. As used herein,
the term "Repayment Date" shall mean the date fixed for repayment in accordance
with the repayment provisions specified above.
SECTION 7. Tax Redemption. If (i) Global Funding is required at any time to
pay Additional Amounts (as defined below) or if Global Funding is obligated to
withhold or deduct any United States taxes with respect to any payment under the
Funding Note, as set forth in the Funding Note Certificate, or if there is a
material probability that Global Funding will become obligated to withhold or
deduct any such United States taxes or otherwise pay Additional Amounts (in the
opinion of independent legal counsel selected by the Funding Agreement
Provider), in each case pursuant to any change in or amendment to any United
States tax laws (or any regulations or rulings thereunder) or any change in
position of the Internal Revenue Service regarding the application or
interpretation thereof (including, but not limited to, the Funding Agreement
Provider's or Global Funding's receipt of a written adjustment from the Internal
18
Revenue Service in connection with an audit) (a "Tax Event"), and (ii) the
Funding Agreement Provider, pursuant to the terms of the relevant Funding
Agreement, has delivered to the Owner notice that the Funding Agreement Provider
intends to terminate the relevant Funding Agreement pursuant to the terms of
such Funding Agreement, then Global Funding will redeem the Funding Note on the
Redemption Date at the Redemption Price together with any unpaid interest
accrued thereon, any Additional Amounts and other amounts payable with respect
thereto, as of the Redemption Date.
Unless otherwise specified in the Funding Note Indenture or on the face
hereof, Global Funding shall give a notice of such redemption to the Holder of
the Funding Note to be redeemed not more than 75 days nor less than 30 days
prior to the Redemption Date; provided, that no such notice of redemption may be
given earlier than 90 days prior to the earliest day on which Global Funding
would become obligated to pay the applicable Additional Amounts were a payment
in respect of the Funding Note then due. Failure to give such notice to the
Holder of any portion of the Funding Note designated for redemption in whole or
in part, or any defect in the notice to any such Holder, shall not affect the
validity of the proceedings for the redemption of any other portion of the
Funding Note.
SECTION 8. Modifications and Amendments. The Funding Note Indenture
contains provisions permitting Global Funding and the Funding Note Indenture
Trustee (1) without the consent of any Holder, to execute Supplemental Funding
Note Indentures for limited purposes and take other actions set forth in the
Funding Note Indenture, and (2) with the consent of the Holder or Holders of not
less than 66(2)/3% of the outstanding principal amount of the Funding Note,
evidenced as provided in the Funding Note Indenture, to execute Supplemental
Funding Note Indentures adding any provisions to or changing in any manner or
eliminating any of the provisions of the Funding Note Indenture or any
Supplemental Funding Note Indenture or modifying in any manner the rights of the
Holder or Holders of the Funding Note subject to specified limitations.
SECTION 9. Obligations Unconditional. No reference herein to the Funding
Note Indenture and no provision of the Funding Note or of the Funding Note
Indenture shall alter or impair the obligation of Global Funding, which is
absolute and unconditional, to pay the principal of, interest on, or any other
amount due and owing with respect to, the Funding Note at the places, at the
respective times, at the rate, and in the coin or currency, herein prescribed.
SECTION 10. Collateral. Pursuant to the Funding Note Indenture, Global
Funding will grant a security interest in, pledge and collaterally assign the
relevant Funding Agreement(s) issued by the Funding Agreement Provider in
connection with the issuance of the Funding Note (each, a "Funding Agreement")
to the Funding Note Indenture Trustee. The Funding Note will be secured by the
Security Interest in the Collateral in favor of the Funding Note Indenture
Trustee for the benefit of each Holder of the Funding Note and each other person
for whose benefit the Funding Note Indenture Trustee is or will be holding the
Collateral (the "Secured Parties").
SECTION 11. Security; Limited Recourse. The Funding Note is solely the
obligation of Global Funding, and will not be guaranteed by any person,
including but not limited to the Funding Agreement Provider, any Allstate Life
Global Funding Trust, any Agent, the Global Funding Trust Beneficial Owner, the
Delaware Trustee, the Funding Note Indenture Trustee or any of their affiliates.
Global Funding's obligations under the Funding Note will be secured by all of
Global Funding's rights and title in one or more Funding Agreement(s) issued by
the Funding Agreement Provider and other rights and assets included in the
applicable Collateral. The Holder or Holders of the Funding Note have no direct
contractual rights against the Funding Agreement Provider under the Funding
Agreement(s). Under the terms of each Funding Agreement, recourse rights to the
Funding Agreement Provider will belong to Global Funding, its successors and
permitted assignees. Global Funding has pledged and collaterally assigned each
Funding Agreement to the Funding Note Indenture Trustee and has granted the
Security Interest in the Collateral to the Funding Note Indenture Trustee for
the benefit of the Secured Parties. Recourse to the Funding Agreement Provider
under each Funding Agreement will be enforceable only by the Funding Note
Indenture Trustee on behalf of the Secured Parties.
SECTION 12. Events of Default. If one or more Events of Default, as defined
in the Funding Note Indenture, shall have occurred and be continuing with
respect to the Funding Note, then, and in every such event, unless the principal
of the Funding Note shall have already become due and payable, the entire
principal and premium (if any) of the Funding Note, any interest accrued
thereon, and any Additional Amounts due and owing and any other amounts payable
with respect thereto, may be declared to be, and upon any such declaration the
same shall become immediately, due and payable; provided that, with respect to
certain Events of Default, without any notice to Global Funding or any other act
19
by the Funding Note Indenture Trustee or any Holder of the Funding Note, the
entire principal and premium (if any) of the Funding Note, any interest accrued
thereon, and any Additional Amounts due and owing, and any other amounts payable
with respect thereto, shall become immediately due and payable without
presentment, demand, protest or other notice of any kind. If the Funding Note is
a Discount Note, the amount of principal of the Funding Note that becomes due
and payable upon such acceleration shall be equal to the amount calculated as
set forth in Section 3 hereof.
SECTION 13. Withholding; Additional Amounts. All amounts due in respect of
the Funding Note will be made without withholding or deduction for or on account
of any present or future taxes, duties, levies, assessments or other
governmental charges of whatever nature imposed or levied by or on behalf of any
governmental authority in the United States having the power to tax payments on
the Funding Note unless the withholding or deduction is required by law. Unless
otherwise specified on the face hereof, Global Funding will not pay any
Additional Amounts to the Holders of the Funding Note in the event that any
withholding or deduction is so required by law, regulation or official
interpretation thereof, and the imposition of a requirement to make any such
withholding or deduction will not give rise to any independent right or
obligation to redeem or repay the Funding Note and shall not constitute an Event
of Default.
SECTION 14. Listing. Unless otherwise specified on the face hereof, the
Funding Note will not be listed on any securities exchange.
SECTION 15. No Recourse. Notwithstanding anything to the contrary contained
in the Funding Note Indenture, or the Funding Note Certificate or Supplemental
Funding Note Indenture, none of the Funding Agreement Provider, its officers,
directors, affiliates, employees or agents, or any of the Delaware Trustee, the
Funding Note Indenture Trustee or the Global Funding Trust Beneficial Owner, or
any of their officers, directors, affiliates, employees or agents (the
"Non-recourse Parties") will be personally liable for the payment of any
principal, interest or any other sums at any time owing under the terms of the
Funding Note. If any Event of Default shall occur with respect to the Funding
Note, the right of the Holders of the Funding Note and the Funding Note
Indenture Trustee on behalf of such Holders in connection with a claim on the
Funding Note shall be limited solely to a proceeding against the Collateral.
Neither the Holders nor the Funding Note Indenture Trustee on behalf of the
Holders will have the right to proceed against the Non-recourse Parties to
enforce the Funding Note (except that to the extent they exercise their rights,
if any, to seize the relevant Funding Agreement, they may enforce the relevant
Funding Agreement against the Funding Agreement Provider) or for any deficiency
judgment remaining after foreclosure of any property included in the Collateral.
SECTION 16. Governing Law. Pursuant to Section 5-1401 of the General
Obligations Law of the State of New York, the Funding Note shall be governed by,
and construed in accordance with, the laws of the State of New York.
20
ANNEX A
OPTION TO ELECT REPAYMENT
The undersigned Holder of the Funding Note hereby irrevocably elects to
have Global Funding repay the principal amount of the Funding Note or portion
hereof at the optional repayment price in accordance with the terms of the
Funding Note.
Date: __________________________
Signature
Sign exactly as name
appears on the front
of this Note
Certificate
[SIGNATURE GUARANTEED
- required only if
Funding Note is to be
issued and delivered
to other than the
registered Holder]
Fill in for
registration of
Funding Note if to be
issued otherwise than
to the registered
Principal amount to be repaid, if Holder:
amount to be repaid is less than the
principal amount of the Funding Note
represented by this Note Certificate
(principal amount remaining must be an
authorized denomination)
$
------------------------
Name: _____________________
Address: _____________________
---------------------
(Please print name and address
including zip code)
Social Security or Other Taxpayer ID Number
A-1
SCHEDULE I
AMORTIZATION TABLE
Date Payment
------------------------ -------------------
I-1
EXHIBIT 10.4
==============================================================================
FORM OF AMENDED AND RESTATED
SUPPORT AND EXPENSES AGREEMENT
between
ALLSTATE LIFE INSURANCE COMPANY
and
ALLSTATE LIFE GLOBAL FUNDING
Dated as of -, 2006
===============================================================================
TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS; OTHER DEFINITIONAL PROVISIONS
SECTION 1.1 Definitions......................................................................1
SECTION 1.2 Other Definitional Provisions....................................................4
ARTICLE 2
CONTINUATION OF THE BASE SUPPORT AGREEMENT; REPRESENTATIONS AND WARRANTIES
SECTION 2.1 Continuation of the Base Support Agreement.......................................5
SECTION 2.2 Representations and Warranties...................................................5
ARTICLE 3
SUPPORT OBLIGATIONS
SECTION 3.1 Payment of Support Obligations...................................................6
SECTION 3.2 Amended or Additional Arrangements...............................................6
SECTION 3.3 Waiver of Notice.................................................................6
SECTION 3.4 No Impairment....................................................................7
SECTION 3.5 Enforcement......................................................................7
SECTION 3.6 Subrogation......................................................................8
SECTION 3.7 Actions; Notification............................................................8
SECTION 3.8 Settlement Without Consent.......................................................9
SECTION 3.9 Third Party Beneficiaries........................................................9
ARTICLE 4
GENERAL PROVISIONS
SECTION 4.1 Binding Effect...................................................................9
SECTION 4.2 Amendments; Assignments..........................................................9
SECTION 4.3 Term of Support Agreement........................................................9
SECTION 4.4 Notices.........................................................................10
SECTION 4.5 Governing Law...................................................................10
SECTION 4.6 Consent to Jurisdiction.........................................................10
SECTION 4.7 Waiver of Jury Trial............................................................11
SECTION 4.8 Counterparts....................................................................11
SECTION 4.9 Severability....................................................................11
SECTION 4.10 Entire Agreement................................................................11
SECTION 4.11 No Waiver.......................................................................11
SECTION 4.12 Remedies Cumulative.............................................................12
SECTION 4.13 Limitation of Delaware Trustee Liability........................................12
i
This AMENDED AND RESTATED SUPPORT AND EXPENSES AGREEMENT, dated as of -,
2006 (this "Amended and Restated Support Agreement"), between Allstate Life
Insurance Company, an Illinois stock life insurance company ("Allstate Life")
and Allstate Life Global Funding, a statutory trust organized under the laws of
the State of Delaware ("Global Funding"),
W I T N E S S E T H:
WHEREAS, Allstate Life and Global Funding entered into that certain Support
and Expenses Agreement, dated as of June 27, 2002, as amended and restated by
the Amended and Restated Support and Expenses Agreement, dated as of April 27,
2004, and as further amended and restated by the Amended and Restated Support
and Expenses Agreement, dated as of August 16, 2005 (as so amended and restated,
the "Base Support Agreement"), and the parties hereto desire to amend and
restate the Base Support Agreement in its entirety;
WHEREAS, since August 27, 2004, Global Funding has been facilitating, and
desires to continue to facilitate, a program (the "Program") for the issuance,
from time to time, of Secured Medium Term Notes and Allstate Life(R)
CoreNotes(R) (collectively, the "Notes"), as more fully described in the
Registration Statement;
WHEREAS, the Notes outstanding under the Program have been, and any Notes
to be issued under the Program will be, issued by a newly created Delaware
statutory trust (each, a "Trust"), as more fully described in the Registration
Statement; and
WHEREAS, each existing Trust has acquired, and each Trust to be formed will
acquire, one or more funding agreement(s) (each, a "Funding Agreement") issued
by Allstate Life;
NOW THEREFORE, in consideration of the premises and covenants set forth in
this Amended and Restated Support Agreement, the parties agree as follows:
ARTICLE 1
DEFINITIONS; OTHER DEFINITIONAL PROVISIONS
SECTION 1.1 Definitions. Unless the context otherwise requires, the
following terms, as used in this Amended and Restated Support Agreement, have
the following meanings:
"Additional Amounts", with respect to any Trust, has the meaning set forth
in the applicable Indenture or Funding Note Indenture.
"Administrator" means AMACAR Pacific Corp., a Delaware corporation, in its
capacity as the sole administrator of Global Funding, and its permitted
successors and assigns.
1
"Amended and Restated Support Agreement" means this instrument, as
originally executed, and as the same may be amended, supplemented, modified,
restated or replaced from time to time.
"Agents" has the meaning ascribed in the Distribution Agreement.
"Allstate Life" means Allstate Life Insurance Company, an Illinois stock
life insurance company, and its successors.
"Base Support Agreement" has the meaning ascribed in the first recital.
"Business Day" means a day (other than a Saturday, Sunday or legal holiday)
on which commercial banks in the City of New York, the Borough of Manhattan and
Cook County, State of Illinois, are open for business.
"Commission" means the Securities and Exchange Commission.
"Delaware Trustee" means Wilmington Trust Company, a Delaware banking
corporation, not in its individual capacity but solely as trustee of Global
Funding, and its successors.
"Distribution Agreement" means that certain Distribution Agreement dated
- -, 2006, by and among Global Funding and the Agents named therein, as the same
may be amended, supplemented, modified, restated or replaced from time to time.
"Excluded Amounts" means (i) any obligation of Global Funding or any Trust
to make any payment in accordance with the terms of any Funding Note or any
Notes, (ii) any obligation or expense of Global Funding or any Trust to the
extent that such obligation or expense has actually been paid utilizing funds
from payments under any Funding Agreement or any Funding Note, as applicable,
(iii) any cost, loss, damage, claim, action, suit, expense, disbursement, tax,
penalty and liability of any kind or nature whatsoever resulting from or
relating to any insurance regulatory or other governmental authority asserting
that: (a) any Funding Note or any Notes are, or are deemed to be, (1)
participations in any Funding Agreement or (2) contracts of insurance, or (b)
the offer, purchase, sale or transfer of any Funding Notes or any Notes, or the
pledge and collateral assignment of, or the grant of a security interest in, any
Funding Agreement, (1) constitute the conduct of the business of insurance or
reinsurance in any jurisdiction or (2) require Global Funding, any Trust or any
Holder to be licensed as an insurer, insurance agent or broker in any
jurisdiction, (iv) any cost, loss, damage, claim, action, suit, expense,
disbursement, tax, penalty and liability of any kind imposed on a Service
Provider resulting from the bad faith, misconduct or negligence of such Service
Provider, (v) any income taxes or overhead expenses of any Service Provider,
(vi) any withholding taxes imposed with respect to payments made under any
Funding Agreement, any Funding Note or any Notes, or (viii) any Additional
Amounts paid to any Holder.
2
With respect to any Support Obligation owed to the Delaware Trustee and the
Administrator, clause (iii) of the definition of "Excluded Amounts" shall not
apply.
"Funding Agreement" has the meaning ascribed in the fourth recital.
"Funding Note", with respect to any Trust, has the meaning ascribed in the
applicable Funding Note Indenture.
"Funding Note Indenture" means, with respect to any Funding Note sold by
Global Funding to a Trust, that certain Funding Note Indenture included in Part
H of the Series Instrument for the Trust, among Global Funding and the other
parties specified therein, as the same may be amended, supplemented, modified,
restated or replaced from time to time.
"Funding Note Indenture Trustee", with respect to any Funding Note, has the
meaning ascribed in the applicable Funding Note Indenture.
"Global Funding" means Allstate Life Global Funding, a statutory trust
formed under the laws of the State of Delaware.
"Holder" means any holder of the Notes.
"Indenture" means, with respect to any Trust, that certain Indenture
included in Part G of the Series Instrument for the Trust, among the Trust and
the other parties specified therein, as the same may amended, supplemented,
modified, restated or replaced from time to time.
"Indenture Trustee", with respect to any Trust, has the meaning ascribed in
the applicable Indenture.
"Notes" has the meaning ascribed in the second recital.
"Notice of Obligation" means the instrument evidencing a Support Obligation
of Global Funding in, or substantially in, the form attached as Exhibit A.
"Proceeding" has the meaning ascribed in Section 3.7(a).
"Program" has the meaning ascribed in the second recital.
"Registration Statement" means the Registration Statement relating to the
Program (File No. 333-129157), filed with the Commission by Allstate Life and
Global Funding on October 20, 2005, as amended by Amendment No. 1 filed with the
Commission on November 29, 2005, and Amendment No. 2 filed with the Commission
on -, 2006, and as it may further be amended, supplemented, modified, restated
or replaced from time to time.
3
"Series Instrument" means, with respect to any Trust, the Series Instrument
of the Trust, pursuant to which the Funding Note Indenture, the Indenture and
certain other agreements are entered into, and certain other documents are
executed, in connection with the issuance of the Notes by the Trust.
"Service Provider" means each of the Delaware Trustee, any Funding Note
Indenture Trustee, any Indenture Trustee, the Administrator and any other agent
or provider of services to Global Funding (other than the Agents).
"Standard Indenture Terms" means the Standard Indenture Terms relating to
the Program for the issuance of Notes, substantially in the form filed as an
exhibit to the Registration Statement.
"Support Obligations" means, without duplication, any and all (i)
reasonable costs and expenses reasonably incurred (including the reasonable fees
and expenses of any Service Provider), relating to the offering, sale and
issuance of the Funding Notes and the Notes and (ii) costs, expenses and taxes
of Global Funding; in each case except the Excluded Amounts.
"Trust" has the meaning ascribed in the third recital.
SECTION 1.2 Other Definitional Provisions. For all purposes of this Amended
and Restated Support Agreement, except as otherwise expressly provided or unless
the context otherwise requires:
(a) the terms defined in this Article shall have the meanings ascribed to
them in this Article and shall include the plural as well as the
singular;
(b) the words "include", "includes" and "including" shall be construed to
be followed by the words "without limitation";
(c) Article and Section headings are for the convenience of the reader and
shall not be considered in interpreting this Amended and Restated
Support Agreement or the intent of the parties to this Amended and
Restated Support Agreement; and
(d) capitalized terms not otherwise defined in this Amended and Restated
Support Agreement will have the respective meanings set forth in the
Standard Indenture Terms.
4
ARTICLE 2
CONTINUATION OF THE BASE SUPPORT AGREEMENT; REPRESENTATIONS AND
WARRANTIES
SECTION 2.1 Continuation of the Base Support Agreement. The parties hereto
agree that, upon the execution of this Amended and Restated Support Agreement:
(a) the Base Support Agreement shall continue in full force and effect as
amended and restated by this Amended and Restated Support Agreement;
and
(b) the rights and obligations of the parties hereto shall be as provided
in this Amended and Restated Support Agreement.
SECTION 2.2 Representations and Warranties. Each party to this Amended and
Restated Support Agreement represents and warrants to the other that as of the
date of this Amended and Restated Support Agreement:
(a) it has the power to enter into this Amended and Restated Support
Agreement and to consummate the transactions contemplated by this
Amended and Restated Support Agreement;
(b) it has duly authorized, executed and delivered this Amended and
Restated Support Agreement;
(c) assuming the due authorization, execution and delivery of this Amended
and Restated Support Agreement by the other party, this Amended and
Restated Support Agreement constitutes a legal, valid and binding
obligation of the representing party;
(d) this Amended and Restated Support Agreement is enforceable against the
representing party in accordance with its terms, subject to applicable
bankruptcy, insolvency and similar laws affecting creditors' rights,
and subject as to enforceability to general principles of equity,
regardless of whether enforcement is sought in a proceeding in equity
or at law;
(e) its execution and delivery of this Amended and Restated Support
Agreement, consummation by it of the transactions contemplated by this
Amended and Restated Support Agreement and the performance of its
obligations under this Amended and Restated Support Agreement do not
and will not constitute or result in a default, breach or violation of
the terms or provisions of its organizational documents or any
material indenture, contract, agreement, instrument, mortgage,
judgment, injunction or
5
order applicable to which it is a party or by which any of its
properties may be bound; and
(f) no filing with or authorization, order, consent, permit or approval of
any federal or state governmental authority or agency or political
subdivision thereof is required for the execution, delivery and
performance of this Amended and Restated Support Agreement that has
not been already obtained or acquired.
ARTICLE 3
SUPPORT OBLIGATIONS
SECTION 3.1 Payment of Support Obligations.
(a) Allstate Life irrevocably and unconditionally agrees to: (i) indemnify
Global Funding against, and pay, all Support Obligations; and (ii)
without duplication, indemnify each Service Provider against, and pay,
all Support Obligations due and payable by Global Funding to such
Service Provider, in each case within two Business Days of receipt of
the applicable Notice of Obligation, subject only to the terms and
conditions of this Amended and Restated Support Agreement.
(b) Allstate Life agrees to pay any amount due under this Amended and
Restated Support Agreement in the currency in which the related
Support Obligation originated.
(c) Allstate Life and Global Funding agree that all payments due under
this Section 3.1 in respect of any Support Obligation shall be
effected, and any responsibility of Allstate Life to pay such Support
Obligation pursuant to the indemnity provided to Global Funding in
this Amended and Restated Support Agreement shall be discharged, by
the payment by Allstate Life, at the order of Global Funding, to the
account of the person to whom such Support Obligation is owed, as
specified in the applicable Notice of Obligation.
SECTION 3.2 Amended or Additional Arrangements. Global Funding will not,
without the prior written approval of Allstate Life: (a) enter into or amend,
modify, restate, and/or supplement any compensation or indemnification
arrangements with respect to the Program; or (b) waive any of its rights under
any compensation or indemnification provisions under the Program.
SECTION 3.3 Waiver of Notice. Allstate Life waives notice of any fact or
circumstance that could give rise to the payment of any Support Obligation under
6
Section 3.1 and, except as otherwise provided in this Amended and Restated
Support Agreement, Allstate Life also waives presentment, demand for payment,
protest, notice of nonpayment, notice of dishonor, notice of redemption and all
other notices and demands.
SECTION 3.4 No Impairment. The obligations, covenants, agreements and
duties of Allstate Life under this Amended and Restated Support Agreement will
in no way be affected or impaired by reason of the happening from time to time
of any of:
(a) the extension of time for the payment of all or any portion of any
Support Obligation or for the performance of any other obligation
arising under, out of, or in connection with, any Support Obligation;
(b) any failure, omission, delay or lack of diligence on the part of
Global Funding to enforce, assert or exercise any right, privilege,
power or remedy conferred on Global Funding with respect to any
Support Obligation or any action on the part of Global Funding
granting indulgence or extension of any kind;
(c) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or
readjustment of debt of, or other similar proceedings affecting,
Global Funding or any of the assets of Global Funding;
(d) the existence of any claim, set-off or other rights that Allstate Life
may have at any time against Global Funding; provided, that nothing in
this Amended and Restated Support Agreement shall prevent the
assertion of any such claim by separate suit or compulsory
counterclaim; or
(e) any other act or omission to act or delay of any kind by Global
Funding or any other Person or any other circumstance whatsoever which
might, but for the provisions of this Section 3.4(e), constitute a
legal or equitable discharge of or defense to Allstate Life's
obligations under this Amended and Restated Support Agreement.
SECTION 3.5 Enforcement. Notwithstanding any rights granted to Allstate
Life under Section 3.7, Allstate Life waives any right or remedy to require that
any action be brought against any Person prior to the assertion of a claim under
this Amended and Restated Support Agreement.
7
SECTION 3.6 Subrogation. Upon, and subject to, the payment by Allstate Life
of any Support Obligation:
(a) Allstate Life shall be subrogated to all of the rights, interests and
remedies, if any, of Global Funding in respect of such Support
Obligation; and
(b) Global Funding will: (i) from time to time execute all such
instruments and other agreements and take all such other actions as
may be necessary or desirable, or that Allstate Life may request, to
protect any interest of Allstate Life with respect to any Support
Obligation or to enable Allstate Life to exercise or enforce any
right, interest or remedy it may have with respect to any such Support
Obligation; and (ii) release to Allstate Life any amount received
relating to any Support Obligation, or any portion of any Support
Obligation, immediately after any such amount relating to such Support
Obligation, or any portion of any such Support Obligation, is received
by Global Funding.
SECTION 3.7 Actions; Notification.
(a) Global Funding shall give prompt written notice to Allstate Life of
any litigation, or any investigation or proceeding by any governmental
agency or body or other Person, whether commenced or threatened,
against Global Funding that may give rise to any Support Obligation
(each, a "Proceeding"), but Global Funding's failure to so notify
Allstate Life shall not relieve Allstate Life from any liability which
it may have otherwise under this Amended and Restated Support
Agreement unless the failure to so notify had an adverse impact on
Allstate Life.
(b) Allstate Life may, in its sole discretion, elect to assume the defense
of Global Funding in any Proceeding that could give rise to any
Support Obligation, and if it so elects, Allstate Life shall select
counsel reasonably acceptable to Global Funding to represent Global
Funding in such Proceeding and pay the fees and expenses of such
counsel. In any Proceeding, Global Funding shall have the right to
retain its own counsel, but the fees and disbursements of such counsel
shall not constitute a Support Obligation unless: (i) Allstate Life
and Global Funding shall have mutually agreed to the retention of such
counsel; or (ii) the named parties to any such Proceeding (including
any impleaded parties) include both Allstate Life and Global Funding,
and representation of both parties by the same counsel would be
8
inappropriate due to actual or potential differing interests between
them. In no event shall Allstate Life be liable for fees and expenses
of more than one counsel (in addition to any local counsel) for Global
Funding 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.
SECTION 3.8 Settlement Without Consent. Global Funding may not settle any
Proceeding without the consent of Allstate Life.
SECTION 3.9 Third Party Beneficiaries. Allstate Life understands and agrees
that each Service Provider (including such parties in their respective
individual capacity) shall be a third party beneficiary of the indemnity
provided under this Amended and Restated Support Agreement, subject to the
limitations on such indemnity provided in this Amended and Restated Support
Agreement. No other Person shall have any legal or equitable right, remedy or
claim under or in respect of this Amended and Restated Support Agreement or any
covenants, conditions or provisions contained in this Amended and Restated
Support Agreement.
ARTICLE 4
GENERAL PROVISIONS
SECTION 4.1 Binding Effect. All obligations, covenants, agreements and
duties contained in this Amended and Restated Support Agreement shall bind the
permitted successors and assigns, and receivers, trustees and representatives of
each of Allstate Life and Global Funding.
SECTION 4.2 Amendments; Assignments.
(a) This Amended and Restated Support Agreement will not be amended,
supplemented, modified, restated or replaced in any manner, except
with the unanimous written consent of Global Funding, Allstate Life,
the Administrator, the Delaware Trustee, each Funding Note Indenture
Trustee and each Indenture Trustee.
(b) Neither this Amended and Restated Support Agreement nor any title,
right or interest in this Amended and Restated Support Agreement may
be sold, transferred, assigned, hypothecated or alienated in any
manner whatsoever, except with the express written consent of Global
Funding and Allstate Life.
SECTION 4.3 Term of Support Agreement. This Amended and Restated Support
Agreement shall terminate and be of no further force and effect upon the date on
which the Amended and Restated Trust Agreement terminates. Unless and until this
Amended and Restated Support Agreement is terminated as specified in this
9
Section 4.3, this Amended and Restated Support Agreement will be continuing,
irrevocable, unconditional and absolute.
SECTION 4.4 Notices. All demands, notices, instructions or other
communications required or permitted to be given under this Amended and Restated
Support Agreement shall be given in writing by delivering the same against
receipt by facsimile transmission (confirmed by registered or certified mail,
postage prepaid, return receipt requested), or by registered or certified mail,
postage prepaid, return receipt requested, addressed as follows (and if so
given, shall be deemed given when mailed or upon receipt of a confirmation, if
sent by facsimile):
If to Global Funding, to:
c/o AMACAR Pacific Corp.
6525 Morrison Boulevard, Suite 318
Charlotte, North Carolina 28211
Attention: Douglas K. Johnson
Facsimile: (704) 365-1632
If to Allstate Life, to:
Allstate Life Insurance Company
3100 Sanders Road, Suite M3A
Northbrook, Illinois 60062
Attention: Assistant Vice President, Institutional Markets
Facsimile: (847) 326-6289
or such other address previously furnished in writing to the other party.
SECTION 4.5 Governing Law. Pursuant to Section 5-1401 of the General
Obligations Law of the State of New York, this Amended and Restated Support
Agreement shall be governed by, and construed in accordance with, the laws of
the State of New York.
SECTION 4.6 Consent to Jurisdiction. Each party to this Amended and
Restated Support Agreement submits for itself and in connection with its
properties, generally and unconditionally, to the nonexclusive jurisdiction of
the United States Federal court located in the City of New York, the Borough of
Manhattan for purposes of any legal proceeding arising out of or relating to
this Amended and Restated Support Agreement or the transactions contemplated by
this Amended and Restated Support Agreement. Each party to this Amended and
Restated Support Agreement irrevocably waives, to the fullest extent permitted
by law, any objection which it may have to the laying of the venue of any such
proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum. Each party to
this Amended and Restated Support Agreement consents to process being served in
10
any suit, action or proceeding with respect to this Amended and Restated Support
Agreement, or any document delivered pursuant to this Amended and Restated
Support Agreement by the mailing of a copy thereof by registered or certified
mail, postage prepaid, return receipt requested, to its respective address
specified at the time for notices under this Amended and Restated Support
Agreement or to any other address of which it shall have given written notice to
the other party. The foregoing shall not limit the ability of any party to this
Amended and Restated Support Agreement to bring suit in the courts of any other
jurisdiction.
SECTION 4.7 Waiver of Jury Trial. Each of the parties to this Amended and
Restated Support Agreement irrevocably and expressly waives any and all right to
a trial by jury with respect to any legal proceeding arising out of or relating
to this Amended and Restated Support Agreement or any claims or transactions in
connection with this Amended and Restated Support Agreement. Each of the parties
to this Amended and Restated Support Agreement acknowledges that such waiver is
made with full understanding and knowledge of the nature of the rights and
benefits waived.
SECTION 4.8 Counterparts. This Amended and Restated Support Agreement and
any amendments, supplements, modifications, restatements or replacements of this
Amended and Restated Support Agreement, or waivers or consents to this Amended
and Restated Support Agreement, may be executed in any number of counterparts,
and by parties to this Amended and Restated Support Agreement in separate
counterparts, each of which, when so executed and delivered, shall be deemed to
be an original and all of which counterparts, when taken together shall
constitute one and the same instrument. This Amended and Restated Support
Agreement shall become effective upon the execution of a counterpart by each of
the parties to this Amended and Restated Support Agreement.
SECTION 4.9 Severability. In the event any provision or obligation of this
Amended and Restated Support Agreement shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining provisions or obligations, or of such provision or obligation in
any other jurisdiction, shall not in any way be affected or impaired thereby to
the fullest extent permitted under applicable law.
SECTION 4.10 Entire Agreement. This Amended and Restated Support Agreement
constitutes the entire agreement between the parties relating to its subject
matter, and supersedes all previous agreements between the parties, whether
written or oral.
SECTION 4.11 No Waiver. No failure on the part of the parties to this
Amended and Restated Support Agreement to exercise, and no delay in exercising,
and no course of dealing with respect to, any right, power or privilege under
this Amended and Restated Support Agreement shall operate as a waiver thereof,
nor shall any single or partial exercise thereof or the exercise of any other
right, power or privilege operate as such a waiver.
11
SECTION 4.12 Remedies Cumulative. No right, power or remedy of the parties
under this Amended and Restated Support Agreement shall be exclusive of any
other right, power or remedy, but shall be cumulative and in addition to any
other right, power or remedy thereunder or existing by law or in equity.
SECTION 4.13 Limitation of Delaware Trustee Liability. Notwithstanding any
provision of this Amended and Restated Support Agreement to the contrary, it is
expressly understood and agreed by the parties that: (a) this Amended and
Restated Support Agreement is executed and delivered by Wilmington Trust
Company, not individually or personally, but solely as Delaware Trustee, in the
exercise of the powers and authority conferred and vested in it pursuant to the
Amended and Restated Trust Agreement; (b) each of the representations,
undertakings and agreements in this Amended and Restated Support Agreement made
on the part of Global Funding is made and intended not as personal
representations, undertakings and agreements by Wilmington Trust Company, but is
made and intended for the purpose of binding only Global Funding; (c) nothing
contained in this Amended and Restated Support Agreement shall be construed as
creating any liability on Wilmington Trust Company, individually or personally,
to perform any covenant either expressed or implied in this Amended and Restated
Support Agreement, all such liability, if any, being expressly waived by the
parties to this Amended and Restated Support Agreement and by any person
claiming by, through or under the parties to this Amended and Restated Support
Agreement; and (d) under no circumstances shall Wilmington Trust Company be
personally liable for the payment of any indebtedness or expenses of Global
Funding or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by Global Funding under
this Amended and Restated Support Agreement or any other related documents.
12
IN WITNESS WHEREOF, the parties have caused this Amended and Restated
Support Agreement to be executed by duly authorized representatives as of the
day and year first above written.
ALLSTATE LIFE INSURANCE COMPANY
By:
---------------------------------------
Name:
Title:
ALLSTATE LIFE GLOBAL FUNDING
By: WILMINGTON TRUST COMPANY,
not in its individual capacity,
but solely as Delaware Trustee
By:
-----------------------------------------
Name:
Title:
EXHIBIT A
NOTICE OF OBLIGATION
Date: -
By [Hand or Overnight] Delivery and/or Facsimile
Allstate Life Insurance Company
Office of the General Counsel
3100 Sanders Road
Northbrook, Illinois 60062
Telephone: -
Facsimile: -
Ladies and Gentlemen:
Reference is hereby made to the Amended and Restated Support and Expenses
Agreement dated as of -, 2006 (the "Amended and Restated Support
Agreement") entered into between Allstate Life Insurance Company, an Illinois
stock life insurance company ("Allstate Life") and Allstate Life Global Funding,
a statutory trust organized under the laws of the State of Delaware ("Global
Funding"). Capitalized terms used in this notice (this "Notice of Obligation")
and not otherwise defined have the respective meanings ascribed in this Amended
and Restated Support Agreement.
Global Funding hereby represents to Allstate Life that:
(a) on -, Global Funding incurred a Support Obligation in an amount of
$-;
(b) the Support Obligation resulted from -; and
(c) all documents and instruments evidencing the Support Obligation are
attached to this Notice of Obligation.
Global Funding hereby requests Allstate Life to pay the Support Obligation
in accordance with this Amended and Restated Support Agreement to the following
account:
[Name of Bank:
Account No.:
Reference No.:]
A-1
IN WITNESS WHEREOF, Global Funding has executed and delivered this Notice
of Obligation as of the date first written above.
ALLSTATE LIFE GLOBAL FUNDING
By: WILMINGTON TRUST COMPANY,
not in its individual capacity,
but solely as Delaware Trustee
By:
--------------------------------------
Name:
Title:
A-2
EXHIBIT 10.5
===============================================================================
STANDARD SUPPORT AND EXPENSES AGREEMENT TERMS
with respect to
ALLSTATE LIFE GLOBAL FUNDING TRUSTS
===============================================================================
TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS; OTHER DEFINITIONAL PROVISIONS
SECTION 1.1 Definitions......................................................................1
SECTION 1.2 Other Definitional Provisions....................................................4
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
SECTION 2.1 Representations and Warranties...................................................4
ARTICLE 3
SUPPORT OBLIGATIONS
SECTION 3.1 Payment of Support Obligations...................................................5
SECTION 3.2 Amended or Additional Arrangements...............................................6
SECTION 3.3 Waiver of Notice.................................................................6
SECTION 3.4 No Impairment....................................................................6
SECTION 3.5 Enforcement......................................................................6
SECTION 3.6 Subrogation......................................................................7
SECTION 3.7 Actions; Notification............................................................7
SECTION 3.8 Settlement Without Consent.......................................................8
SECTION 3.9 Third Party Beneficiaries........................................................8
ARTICLE 4
GENERAL PROVISIONS
SECTION 4.1 Binding Effect...................................................................8
SECTION 4.2 Amendments; Assignments..........................................................8
SECTION 4.3 Term of Support Agreement........................................................8
SECTION 4.4 Notices..........................................................................8
SECTION 4.5 Governing Law....................................................................9
SECTION 4.6 Consent to Jurisdiction..........................................................9
SECTION 4.7 Waiver of Jury Trial............................................................10
SECTION 4.8 Counterparts....................................................................10
SECTION 4.9 Severability....................................................................10
SECTION 4.10 Entire Agreement................................................................10
SECTION 4.11 No Waiver.......................................................................10
SECTION 4.12 Remedies Cumulative.............................................................10
SECTION 4.13 Limitation of Delaware Trustee Liability........................................10
EXHIBIT A Notice of Obligation...........................................................A-1
i
This document constitutes the Standard Support and Expenses Agreement
Terms, which will be incorporated by reference in, and form a part of, the
Support Agreement (as defined below) by and between Allstate Life Insurance
Company, an Illinois stock life insurance company (including any successor,
"Allstate Life") and the Trust (as defined below).
These Standard Support and Expenses Terms shall be of no force and effect
unless and until incorporated by reference in and then only to the extent not
modified by, the Support Agreement.
The following terms and provisions shall govern the reimbursement
arrangement and terms of indemnity with respect to the Trust, subject to
contrary terms and provisions expressly adopted in the Support Agreement, which
contrary terms shall be controlling.
ARTICLE I
DEFINITIONS; OTHER DEFINITIONAL PROVISIONS
SECTION 1.1 Definitions. The following terms, as used in the Support
Agreement, have the following meanings:
"Additional Amounts" has the meaning set forth in the Indenture.
"Administrative Services Agreement" means that certain Administrative
Services Agreement included in Part B of the Series Instrument, by and between
the Trust and the Administrator, as the same may be amended, supplemented,
modified, restated or replaced from time to time.
"Administrator" means the party named as such in the Administrative
Services Agreement, and its successors.
"Agents" has the meaning set forth in the Distribution Agreement.
"Allstate Life" has the meaning ascribed in the introductory paragraph.
"Business Day" means a day (other than a Saturday, Sunday or legal holiday)
on which commercial banks in the City of New York, the Borough of Manhattan and
Cook County, State of Illinois, are open for business.
"Coordination Agreement" means that certain Coordination Agreement included
in Part F of the Series Instrument, among the Trust and the other parties
specified therein, as the same may be amended, supplemented, modified, restated
or replaced from time to time.
"Delaware Trustee" means the party named as such in the Trust Agreement,
not in its individual capacity but solely as trustee of the Trust, and its
successors.
1
"Distribution Agreement" means that certain Distribution Agreement dated
- -, 2006, by and among Global Funding and the Agents named therein, as the
same may be amended, supplemented, modified, restated or replaced from time to
time.
"Excluded Amounts" means (i) any obligation of Global Funding or the Trust
to make any payment in accordance with the terms of the Funding Note or the
Notes, (ii) any obligation or expense of Global Funding or the Trust to the
extent that such obligation or expense has actually been paid utilizing funds
from payments under the Funding Agreement(s) or the Funding Note, as applicable,
(iii) any cost, loss, damage, claim, action, suit, expense, disbursement, tax,
penalty and liability of any kind or nature whatsoever resulting from or
relating to any insurance regulatory or other governmental authority asserting
that: (a) the Funding Note or the Notes are, or are deemed to be, (1)
participations in the Funding Agreement(s) or (2) contracts of insurance, or (b)
the offer, purchase, sale or transfer of the Funding Notes or the Notes, or the
pledge and collateral assignment of, or the grant of a security interest in, the
Funding Agreement(s), (1) constitute the conduct of the business of insurance or
reinsurance in any jurisdiction or (2) require Global Funding, the Trust or any
Holder to be licensed as an insurer, insurance agent or broker in any
jurisdiction, (iv) any cost, loss, damage, claim, action, suit, expense,
disbursement, tax, penalty and liability of any kind imposed on a Service
Provider resulting from the bad faith, misconduct or negligence of such Service
Provider, (v) any income taxes or overhead expenses of any Service Provider,
(vi) any withholding taxes imposed with respect to payments made under any
Funding Agreement(s), the Funding Note or the Notes, or (viii) any obligation to
pay Additional Amounts.
With respect to any Support Obligation owed to the Delaware Trustee and the
Administrator, clause (iii) of the definition of "Excluded Amounts" shall not
apply.
"Funding Agreement" means each funding agreement issued by Allstate Life to
Global Funding, which is immediately pledged and collaterally assigned by Global
Funding to the Funding Note Indenture Trustee, and immediately thereafter
assigned absolutely to, and deposited into, the Trust by Global Funding, as the
same may be amended, supplemented, modified, restated or replaced from time to
time.
"Funding Note" has the meaning set forth in the Funding Note Indenture.
"Funding Note Indenture" means that certain Funding Note Indenture included
in Part H of the Series Instrument, among Global Funding and the other parties
specified therein, as the same may be amended, supplemented, modified, restated
or replaced from time to time.
"Funding Note Indenture Trustee" means the party specified as such in the
Funding Note Indenture, solely as the Funding Note Indenture Trustee, and its
successors.
2
"Global Funding" means Allstate Life Global Funding, a statutory trust
formed under the laws of the State of Delaware.
"Holder" means any holder of the Notes.
"Indenture" means that certain Indenture included in Part G of the Series
Instrument, among the Trust and the other parties specified therein, as the same
may be amended, supplemented, modified, restated or replaced from time to time.
"Indenture Trustee" means the party specified as such in the Indenture,
solely as the Indenture Trustee, and its successors.
"Name Licensing Agreement" means that certain Name Licensing Agreement
included in Part D of the Series Instrument, as the same may be amended,
supplemented, modified, restated or replaced from time to time.
"Notes" has the meaning ascribed in the Indenture.
"Notice of Obligation" means the instrument evidencing a Support Obligation
of the Trust in, or substantially in, the form attached as Exhibit A.
"Proceeding" has the meaning ascribed in Section 3.7(a).
"Program" means the program for the issuance, from time to time, of secured
medium term notes of the Allstate Life Global Funding Trusts.
"Series Instrument" means the Series Instrument of the Trust, pursuant to
which the Administrative Services Agreement, the Coordination Agreement, the
Funding Note Indenture, the Indenture, the Name Licensing Agreement, the Support
Agreement, the Terms Agreement and the Trust Agreement are entered into, and
certain other documents are executed, in connection with the issuance of the
Notes by the Trust.
"Service Provider" means each of the Delaware Trustee, the Funding Note
Indenture Trustee, the Indenture Trustee, the Administrator and any other agent
or provider of services to the Trust (other than the Agents), in each case
acting in such capacity with respect to the Notes.
"Support Agreement" means the Support and Expenses Agreement with respect
to the Trust included in Part C of the Series Instrument, as the same may be
amended, supplemented, modified, restated or replaced from time to time, which
Support Agreement incorporates by reference these Standard Support and Expenses
Agreement Terms.
"Support Obligations" means any and all (i) reasonable costs and expenses
reasonably incurred (including the reasonable fees and expenses of counsel),
relating to
3
the offering, sale and issuance of the Notes by the Trust and (ii) costs,
expenses and taxes of the Trust; in each case except the Excluded Amounts.
"Terms Agreement" means that certain Terms Agreement related to the
offering of the Notes included in Part E of the Series Instrument, by and among
Global Funding, the Trust and each Agent named therein, which will incorporate
by reference the terms of the Distribution Agreement.
"Trust" means the Allstate Life Global Funding Trust specified in the
Series Instrument, together with its permitted successors and assigns.
"Trust Agreement" means that certain Trust Agreement included in Part A of
the Series Instrument, pursuant to which the Trust is created.
SECTION 1.2 Other Definitional Provisions. For all purposes of the Support
Agreement, except as otherwise expressly provided or unless the context
otherwise requires:
(a) the terms defined in this Article shall have the meanings ascribed to
them in this Article and shall include the plural as well as the
singular;
(b) the words "include", "includes" and "including" shall be construed to
be followed by the words "without limitation";
(c) Article and Section headings are for the convenience of the reader and
shall not be considered in interpreting the Support Agreement or the
intent of the parties to the Support Agreement; and
(d) capitalized terms not otherwise defined in the Support Agreement will
have the respective meanings set forth in the Indenture.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
SECTION 2.1 Representations and Warranties. Each party to the Support
Agreement represents and warrants to the other that as of the date of the
Support Agreement:
(a) it has the power to enter into the Support Agreement and to consummate
the transactions contemplated by the Support Agreement;
(b) it has duly authorized, executed and delivered the Support Agreement;
(c) assuming the due authorization, execution and delivery of the Support
Agreement by the other party, the Support Agreement constitutes a
legal, valid and binding obligation of the representing party;
4
(d) the Support Agreement is enforceable against the representing party in
accordance with its terms, subject to applicable bankruptcy,
insolvency and similar laws affecting creditors' rights, and subject
as to enforceability to general principles of equity, regardless of
whether enforcement is sought in a proceeding in equity or at law;
(e) its execution and delivery of the Support Agreement, consummation by
it of the transactions contemplated by the Support Agreement and the
performance of its obligations under the Support Agreement do not and
will not constitute or result in a default, breach or violation of the
terms or provisions of its organizational documents or any material
indenture, contract, agreement, instrument, mortgage, judgment,
injunction or order applicable to which it is a party or by which any
of its properties may be bound; and
(f) no filing with or authorization, order, consent, permit or approval of
any federal or state governmental authority or agency or political
subdivision thereof is required for the execution, delivery and
performance of the Support Agreement that has not been already
obtained or acquired.
ARTICLE 3
SUPPORT OBLIGATIONS
SECTION 3.1 Payment of Support Obligations.
(a) Allstate Life irrevocably and unconditionally agrees to (i) indemnify
the Trust against, and pay, all Support Obligations and (ii) without
duplication, indemnify each Service Provider against, and pay, all
Support Obligations due and payable by the Trust to such Service
Provider, in each case within two Business Days of receipt of the
applicable Notice of Obligation, subject only to the terms and
conditions of the Support Agreement.
(b) Allstate Life agrees to pay any amount due under the Support Agreement
in the currency in which the related Support Obligation originated.
(c) Allstate Life and the Trust agree that all payments due under this
Section 3.1 in respect of any Support Obligation shall be effected,
and any responsibility of Allstate Life to pay such Support Obligation
pursuant to the indemnity provided to the Trust in the Support
Agreement shall be discharged, by the payment by Allstate Life, at the
order of the Trust, to the account of the person to whom such Support
Obligation is owed, as specified in the applicable Notice of
Obligation.
5
SECTION 3.2 Amended or Additional Arrangements. The Trust will not, without
the prior written approval of Allstate Life (a) enter into or amend, modify,
restate, and/or supplement any compensation or indemnification arrangements with
respect to the Program or (b) waive any of its rights under any compensation or
indemnification provisions under the Program.
SECTION 3.3 Waiver of Notice. Allstate Life waives notice of any fact or
circumstance that could give rise to the payment of any Support Obligation under
Section 3.1 and, except as otherwise provided in the Support Agreement, Allstate
Life also waives presentment, demand for payment, protest, notice of nonpayment,
notice of dishonor, notice of redemption and all other notices and demands.
SECTION 3.4 No Impairment. The obligations, covenants, agreements and
duties of Allstate Life under the Support Agreement will in no way be affected
or impaired by reason of the happening from time to time of any of:
(a) the extension of time for the payment of all or any portion of any
Support Obligation or for the performance of any other obligation
arising under, out of, or in connection with, any Support Obligation;
(b) any failure, omission, delay or lack of diligence on the part of the
Trust to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Trust with respect to any Support Obligation
or any action on the part of the Trust granting indulgence or
extension of any kind;
(c) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or
readjustment of debt of, or other similar proceedings affecting, the
Trust or any of the assets of the Trust;
(d) the existence of any claim, set-off or other rights that Allstate Life
may have at any time against the Trust; provided, that nothing in the
Support Agreement shall prevent the assertion of any such claim by
separate suit or compulsory counterclaim; or
(e) any other act or omission to act or delay of any kind by the Trust or
any other Person or any other circumstance whatsoever which might, but
for the provisions of this Section 3.4(e), constitute a legal or
equitable discharge of or defense to Allstate Life's obligations under
the Support Agreement.
SECTION 3.5 Enforcement. Notwithstanding any rights granted to Allstate
Life under Section 3.7, Allstate Life waives any right or remedy to require that
6
any action be brought against any Person prior to the assertion of a claim under
the Support Agreement.
SECTION 3.6 Subrogation. Upon, and subject to, the payment by Allstate Life
of any Support Obligation:
(a) Allstate Life shall be subrogated to all of the rights, interests and
remedies, if any, of the Trust in respect of such Support Obligation;
and
(b) the Trust will (i) from time to time execute all such instruments and
other agreements and take all such other actions as may be necessary
or desirable, or that Allstate Life may request, to protect any
interest of Allstate Life with respect to any Support Obligation or to
enable Allstate Life to exercise or enforce any right, interest or
remedy it may have with respect to any such Support Obligation and
(ii) release to Allstate Life any amount received relating to any
Support Obligation, or any portion of any Support Obligation,
immediately after any such amount relating to such Support Obligation,
or any portion of any such Support Obligation, is received by the
Trust.
SECTION 3.7 Actions; Notification.
(a) The Trust shall give prompt written notice to Allstate Life of any
litigation, or any investigation or proceeding by any governmental
agency or body or other Person, whether commenced or threatened,
against the Trust that may give rise to any Support Obligation (each,
a "Proceeding"), but the Trust's failure to so notify Allstate Life
shall not relieve Allstate Life from any liability which it may have
otherwise under the Support Agreement unless the failure to so notify
had an adverse impact on Allstate Life.
(b) Allstate Life may, in its sole discretion, elect to assume the defense
of the Trust in any Proceeding that could give rise to any Support
Obligation, and if it so elects, Allstate Life shall select counsel
reasonably acceptable to the Trust to represent the Trust in such
Proceeding and pay the fees and expenses of such counsel. In any
Proceeding, the Trust shall have the right to retain its own counsel,
but the fees and disbursements of such counsel shall not constitute a
Support Obligation unless (i) Allstate Life and the Trust shall have
mutually agreed to the retention of such counsel or (ii) the named
parties to any such Proceeding (including any impleaded parties)
include both Allstate Life and the Trust, and representation of both
parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. In no event shall Allstate
Life be liable for fees and expenses of more than one counsel (in
addition to any local counsel) for the Trust in connection with any
7
one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or
circumstances.
SECTION 3.8 Settlement Without Consent. The Trust may not settle any
Proceeding without the consent of Allstate Life.
SECTION 3.9 Third Party Beneficiaries. Allstate Life understands and agrees
that each Service Provider (including such parties in their respective
individual capacity) shall be a third party beneficiary of the indemnity
provided under the Support Agreement, subject to the limitations on such
indemnity provided in the Support Agreement. No other Person shall have any
legal or equitable right, remedy or claim under or in respect of the Support
Agreement or any covenants, conditions or provisions contained in the Support
Agreement.
ARTICLE 4
GENERAL PROVISIONS
SECTION 4.1 Binding Effect. All obligations, covenants, agreements and
duties contained in the Support Agreement shall bind the permitted successors
and assigns, and receivers, trustees and representatives of each of Allstate
Life and the Trust.
SECTION 4.2 Amendments; Assignments.
(a) The Support Agreement will not be amended, supplemented, modified,
restated or replaced in any manner, except with the unanimous written
consent of the Trust, Allstate Life, the Administrator, the Delaware
Trustee and the Indenture Trustee.
(b) Neither the Support Agreement nor any title, right or interest in the
Support Agreement may be sold, transferred, assigned, hypothecated or
alienated in any manner whatsoever, except with the express written
consent of the Trust and Allstate Life.
SECTION 4.3 Term of Support Agreement. The Support Agreement shall
terminate and be of no further force and effect upon the later of (a) the date
on which full payment has been made of all amounts payable to each Holder in
accordance with the terms of the Notes, whether upon maturity, redemption or
otherwise, and (b) the date on which the Trust Agreement and the Trust created
by the Trust Agreement terminate. Unless and until the Support Agreement is
terminated as specified in this Section 4.3, the Support Agreement will be
continuing, irrevocable, unconditional and absolute.
SECTION 4.4 Notices. All demands, notices, instructions or other
communications required or permitted to be given under the Support Agreement
8
shall be given in writing by delivering the same against receipt by facsimile
transmission (confirmed by registered or certified mail, postage prepaid, return
receipt requested), or by registered or certified mail, postage prepaid, return
receipt requested, addressed as follows (and if so given, shall be deemed given
when mailed or upon receipt of a confirmation, if sent by facsimile):
If to the Trust, to:
c/o AMACAR Pacific Corp.
6525 Morrison Boulevard, Suite 318
Charlotte, North Carolina 28211
Attention: Douglas K. Johnson
Facsimile: (704) 365-1632
If to Allstate Life, to:
Allstate Life Insurance Company
3100 Sanders Road, Suite M3A
Northbrook, Illinois 60062
Attention: Assistant Vice President, Institutional Markets
Facsimile: (847) 326-6289
or such other address previously furnished in writing to the
other party.
SECTION 4.5 Governing Law. Pursuant to Section 5-1401 of the General
Obligations Law of the State of New York, the Support Agreement shall be
governed by, and construed in accordance with, the laws of the State of New
York.
SECTION 4.6 Consent to Jurisdiction. Each party to the Support Agreement
submits for itself and in connection with its properties, generally and
unconditionally, to the nonexclusive jurisdiction of the United States Federal
court located in the City of New York, the Borough of Manhattan for purposes of
any legal proceeding arising out of or relating to the Support Agreement or the
transactions contemplated by the Support Agreement. Each party to the Support
Agreement irrevocably waives, to the fullest extent permitted by law, any
objection which it may have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in such a
court has been brought in an inconvenient forum. Each party to the Support
Agreement consents to process being served in any suit, action or proceeding
with respect to the Support Agreement, or any document delivered pursuant to the
Support Agreement by the mailing of a copy thereof by registered or certified
mail, postage prepaid, return receipt requested, to its respective address
specified at the time for notices under the Support Agreement or to any other
address of which it shall have given written notice to the other party. The
foregoing shall not limit the ability of any party to the Support Agreement to
bring suit in the courts of any other jurisdiction.
9
SECTION 4.7 Waiver of Jury Trial. Each of the parties to the Support
Agreement irrevocably and expressly waives any and all right to a trial by jury
with respect to any legal proceeding arising out of or relating to the Support
Agreement or any claims or transactions in connection with the Support
Agreement. Each of the parties to the Support Agreement acknowledges that such
waiver is made with full understanding and knowledge of the nature of the rights
and benefits waived.
SECTION 4.8 Counterparts. The Support Agreement and any amendments,
supplements, modifications, restatements or replacements of the Support
Agreement, or waivers or consents to the Support Agreement, may be executed in
any number of counterparts, and by parties to the Support Agreement in separate
counterparts, each of which, when so executed and delivered, shall be deemed to
be an original and all of which counterparts, when taken together shall
constitute one and the same instrument. The Support Agreement shall become
effective upon the execution of a counterpart by each of the parties to the
Support Agreement.
SECTION 4.9 Severability. In the event any provision or obligation of the
Support Agreement shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby to the
fullest extent permitted under applicable law.
SECTION 4.10 Entire Agreement. The Support Agreement constitutes the entire
agreement between the parties relating to its subject matter, and supersedes all
previous agreements between the parties, whether written or oral.
SECTION 4.11 No Waiver. No failure on the part of the parties to the
Support Agreement to exercise, and no delay in exercising, and no course of
dealing with respect to, any right, power or privilege under the Support
Agreement shall operate as a waiver thereof, nor shall any single or partial
exercise thereof or the exercise of any other right, power or privilege operate
as such a waiver.
SECTION 4.12 Remedies Cumulative. No right, power or remedy of the parties
under the Support Agreement shall be exclusive of any other right, power or
remedy, but shall be cumulative and in addition to any other right, power or
remedy thereunder or existing by law or in equity.
SECTION 4.13 Limitation of Delaware Trustee Liability. Notwithstanding any
provision of the Support Agreement to the contrary, it is expressly understood
and agreed by the parties that (a) the Support Agreement is executed and
delivered by Wilmington Trust Company, not individually or personally, but
solely as Delaware Trustee, in the exercise of the powers and authority
conferred and vested in it pursuant to the Trust Agreement, (b) each of the
representations, undertakings and agreements in the Support Agreement made on
the part of the Trust is made and intended not as personal representations,
undertakings and agreements by Wilmington Trust Company, but is made and
10
intended for the purpose of binding only the Trust, (c) nothing contained in the
Support Agreement shall be construed as creating any liability on Wilmington
Trust Company, individually or personally, to perform any covenant either
expressed or implied in the Support Agreement, all such liability, if any, being
expressly waived by the parties to the Support Agreement and by any person
claiming by, through or under the parties to the Support Agreement and (d) under
no circumstances shall Wilmington Trust Company be personally liable for the
payment of any indebtedness or expenses of the Trust or be liable for the breach
or failure of any obligation, representation, warranty or covenant made or
undertaken by the Trust under the Support Agreement or any other related
documents.
11
EXHIBIT A
NOTICE OF OBLIGATION
DATE: -
BY [HAND OR OVERNIGHT] DELIVERY AND/OR FACSIMILE
Allstate Life Insurance Company
Office of the General Counsel
3100 Sanders Road
Northbrook, Illinois 60062
Telephone: -
Facsimile: -
Ladies and Gentlemen:
Reference is hereby made to the Support and Expenses Agreement dated as of
- - (the "Support Agreement") entered into between Allstate Life Insurance
Company, an Illinois stock life insurance company ("Allstate Life") and Allstate
Life Global Funding Trust -, a statutory trust organized under the laws of
the State of Delaware (the "Trust"). Capitalized terms used in this notice (this
"Notice of Obligation") and not otherwise defined have the respective meanings
ascribed in the Support Agreement.
The Trust hereby represents to Allstate Life that:
(a) on -, the Trust incurred a Support Obligation in an amount
of $-;
(b) the Support Obligation resulted from -; and
(c) all documents and instruments evidencing the Support Obligation
are attached to this Notice of Obligation.
The Trust hereby requests Allstate Life to pay the Support Obligation in
accordance with the Support Agreement to the following account:
[Name of Bank:
Account No.:
Reference No.:]
A-1
IN WITNESS WHEREOF, the Trust has executed and delivered this Notice of
Obligation as of the date first written above.
ALLSTATE LIFE GLOBAL FUNDING TRUST -
By: WILMINGTON TRUST COMPANY, not in its
individual capacity, but solely as Delaware
Trustee
By:
---------------------------------------------
Name:
Title:
A-2
EXHIBIT 10.7
===============================================================================
FORM OF AMENDED AND RESTATED
ADMINISTRATIVE SERVICES AGREEMENT
between
ALLSTATE LIFE GLOBAL FUNDING
and
AMACAR PACIFIC CORP.
Dated as of -, 2006
==============================================================================
===============================================================================
TABLE OF CONTENTS
Page
ARTICLE 1
DEFINITIONS
SECTION 1.1. Definitions.................................................................2
ARTICLE 2
CONTINUATION OF APPOINTMENT; ADMINISTRATIVE SERVICES
SECTION 2.1. Appointment.................................................................6
SECTION 2.2. Administrative Services.....................................................6
SECTION 2.3. Continuation of the Base Administrative Services Agreement.................10
ARTICLE 3
ACTIVITIES OF GLOBAL FUNDING; EMPLOYEES; OFFICES.
SECTION 3.1. Activities of Global Funding...............................................10
SECTION 3.2. Employees..................................................................10
SECTION 3.3. Offices....................................................................10
ARTICLE 4
COMPENSATION; INDEMNITIES
SECTION 4.1. Compensation...............................................................11
SECTION 4.2. Indemnities................................................................11
ARTICLE 5
TERM
SECTION 5.1. Term ....................................................................11
ARTICLE 6
OBLIGATION TO SUPPLY INFORMATION
SECTION 6.1. Obligation to Supply Information...........................................11
SECTION 6.2. Reliance on Information....................................................12
ARTICLE 7
LIABILITY OF ADMINISTRATOR; STANDARD OF CARE
SECTION 7.1. Liability of Administrator.................................................12
i
SECTION 7.2. No Implied Obligations.....................................................12
SECTION 7.3. Standard of Care...........................................................12
ARTICLE 8
LIMITED RECOURSE
SECTION 8.1. Limited Recourse to Global Funding.........................................13
SECTION 8.2. No Recourse to Trustees and Agents.........................................13
ARTICLE 9
TAX MATTERS
SECTION 9.1. Income Tax Treatment.......................................................13
ARTICLE 10
MISCELLANEOUS
SECTION 10.1. Amendments.................................................................14
SECTION 10.2. No Joint Venture...........................................................14
SECTION 10.3. Assignment.................................................................14
SECTION 10.4. Governing Law; Consent to Jurisdiction; Waiver of Jury Trial...............14
SECTION 10.5. Counterparts...............................................................15
SECTION 10.6. Limitation of Delaware Trustee Liability...................................15
SECTION 10.7. No Petition................................................................16
SECTION 10.8. Severability...............................................................16
SECTION 10.9. Entire Agreement...........................................................16
SECTION 10.10. Administrator to Provide Access to Books and Records.......................16
SECTION 10.11. No Waiver..................................................................17
SECTION 10.12. Remedies Cumulative........................................................17
SECTION 10.13. Notices....................................................................17
ii
This AMENDED AND RESTATED ADMINISTRATIVE SERVICES AGREEMENT (this "Amended
and Restated Administrative Services Agreement") dated as of -, 2006,
between Allstate Life Global Funding, a statutory trust organized under the laws
of the State of Delaware ("Global Funding") and AMACAR Pacific Corp., a Delaware
Corporation, as administrator (in such capacity, including its successors, the
"Administrator"),
W I T N E S S E T H:
WHEREAS, Global Funding and the Administrator entered into that certain
Administrative Services Agreement, dated as of June 27, 2002, as amended and
restated by the Amended and Restated Administrative Services Agreement dated as
of April 27, 2004, and as further amended and restated by the Amended and
Restated Administrative Services Agreement dated as of August 16, 2005 (as so
amended and restated, the "Base Administrative Services Agreement"), and the
parties hereto desire to amend and restate the Base Administrative Services
Agreement in its entirety;
WHEREAS, since April 27, 2004, Global Funding has been facilitating, and
desires to continue to facilitate, a program (the "Program") for the issuance,
from time to time, of Secured Medium Term Notes and Allstate Life(R)
CoreNotes(R) (collectively, the "Notes"), as more fully described in the
Registration Statement (as defined herein);
WHEREAS, each outstanding series of Notes under the Program has been, and
each series of Notes to be issued under the Program will be, issued by a newly
created Delaware statutory trust beneficially owned by Global Funding (each, a
"Trust"), as more fully described in the Registration Statement;
WHEREAS, the Administrator has in the past provided, and Global Funding
desires that the Administrator continue to provide, advice and assistance to
Global Funding and perform various services for Global Funding generally and
with respect to the Program; and
WHEREAS, Global Funding desires to continue to avail itself of the
experience, advice and assistance of the Administrator and to have the
Administrator continue to perform various financial, statistical, accounting and
other services for Global Funding, and the Administrator is willing to furnish
such services on the terms and conditions herein set forth;
NOW THEREFORE, in consideration of the premises and covenants set forth in
this Amended and Restated Administrative Services Agreement, the parties agree
as follows:
1
ARTICLE 1
DEFINITIONS
SECTION 1.1. Definitions. The following terms have the meanings set forth
below:
"Administrator" has the meaning ascribed in the first paragraph of this
Amended and Restated Administrative Services Agreement.
"Affiliate" means, as applied to any Person, any other Person directly or
indirectly controlling, controlled by, or under common control with, that Person
and, in the case of an individual, any spouse or other member of that
individual's immediate family. For the purposes of this definition, "control"
(including with correlative meanings, the terms "controlling", "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of that Person, whether through the
ownership of voting securities or by contract or otherwise.
"Agents" has the meaning set forth in the Distribution Agreement.
"Allstate Life" means Allstate Life Insurance Company, a stock life
insurance company organized and licensed under the laws of the State of
Illinois, and any successor.
"Amended and Restated Administrative Services Agreement" means this
instrument, as originally executed, and as the same may be amended,
supplemented, modified, restated or replaced from time to time.
"Amended and Restated Name Licensing Agreement" means that certain Amended
and Restated Name Licensing Agreement dated as of -, 2006, between Allstate
Insurance Company and Global Funding, as the same may be amended, supplemented,
modified, restated or replaced from time to time.
"Amended and Restated Trust Agreement" means that certain Amended and
Restated Trust Agreement of Global Funding, dated as of -, 2006, as the
same may be amended, supplemented, modified, restated or replaced from time to
time.
"Amended and Restated Support Agreement" means that certain Amended and
Restated Support Agreement dated as of -, 2006, between Allstate Life and
Global Funding, as the same may be amended, supplemented, modified, restated or
replaced from time to time.
"Base Administrative Services Agreement" has the meaning ascribed in the
first recital.
"Calculation Agent", with respect to any Trust, has the meaning ascribed in
the applicable Indenture.
2
"Closing Instrument" means, with respect to any Trust, the Closing
Instrument of the Trust, pursuant to which certain documents are executed in
connection with the issuance of the Notes by the Trust.
"Commission" has the meaning ascribed in Section 2.2(c).
"Coordination Agreement" means, with respect to any Trust, that certain
Coordination Agreement included in Part F of the Series Instrument, among the
Trust and the other parties specified therein, as the same may be amended,
supplemented, modified, restated or replaced from time to time.
"Delaware Trustee" means Wilmington Trust Company, a Delaware banking
corporation, in its capacity as the Delaware trustee of Global Funding, and its
successors in such capacity.
"Distribution Agreement" means that certain Distribution Agreement dated
- -, 2006, by and among Global Funding and the Agents named therein, as the
same may be amended, supplemented, modified, restated or replaced from time to
time.
"Exchange Rate Agent", with respect to any Trust, has the meaning ascribed
in the applicable Indenture.
"Funding Note" means each funding note issued, or to be issued from time to
time, by Global Funding in connection with the Program.
"Funding Note Calculation Agent", in respect of any Funding Note, has the
meaning ascribed in the applicable Funding Note Indenture.
"Funding Note Exchange Rate Agent", with respect to any Funding Note, has
the meaning ascribed in the applicable Funding Note Indenture.
"Funding Note Indenture" means, with respect to any Funding Note sold by
Global Funding to a Trust, that certain Funding Note Indenture included in Part
H of the Series Instrument for the Trust, among Global Funding and the parties
specified therein, as the same may be amended, supplemented, modified, restated,
or replaced from time to time.
"Funding Note Indenture Trustee", with respect to any Funding Note, has the
meaning ascribed in the applicable Funding Note Indenture.
"Funding Note Paying Agent", with respect to any Funding Note, has the
meaning ascribed in the applicable Funding Note Indenture.
"Funding Note Registrar", with respect to any Funding Note, has the meaning
3
ascribed in the applicable Funding Note Indenture.
"Global Funding" has the meaning ascribed in the first paragraph.
"Indenture" means, with respect to any Trust, that certain Indenture
included in Part G of the Series Instrument, among the Trust and the other
parties specified therein, as the same may be amended, supplemented, modified,
restated or replaced from time to time.
"Indenture Trustee", with respect to the Notes of any Trust, has the
meaning ascribed in the applicable Indenture.
"Loss and Expense" has the meaning ascribed in Section 4.2.
"Moody's" means Moody's Investors Service, Inc.
"Name Licensing Agreement" means, with respect to any Trust, that certain
Name Licensing Agreement included in Part D of the Series Instrument for the
Trust, as the same may be amended, supplemented, modified, restated or replaced
from time to time.
"Notes" has the meaning ascribed in the second recital.
"Paying Agent", with respect to the Notes of any Trust, has the meaning set
forth in the applicable Indenture.
"Person" means any natural person, corporation, limited partnership,
general partnership, joint stock company, joint venture, association, company,
limited liability company, trust (including any beneficiary thereof), bank,
trust company, land trust, business trust or other organization, whether or not
a legal entity, and any government or any agency or political subdivision
thereof.
"Program" has the meaning ascribed in the second recital.
"Program Documents" means the Amended and Restated Trust Agreement, this
Amended and Restated Administrative Services Agreement, the Amended and Restated
Support Agreement, the Amended and Restated Name Licensing Agreement, the
Distribution Agreement, each Terms Agreement, each Funding Note, each Funding
Note Indenture, each Series Instrument and each Closing Instrument (including
all documents and instruments included therein), and any other documents or
instruments entered into by, or with respect to, or on behalf of, Global
Funding.
"Rating Agency" means each of Moody's, S&P and any other rating agency
which provides a rating of any Notes.
"Registrar", with respect to the Notes of any Trust, has the meaning set
forth in the applicable Indenture.
4
"Registration Statement" means the Registration Statement relating to the
Program (File No. 333-129157), filed with the Commission by Allstate Life and
Global Funding on October 20, 2005, as amended by Amendment No. 1 filed with the
Commission on November 29, 2005, and Amendment No. 2 filed with the Commission
on -, 2006, and as it may further be amended, supplemented, modified,
restated or replaced from time to time.
"Responsible Officer" means, with respect to any Funding Note Indenture
Trustee, any Indenture Trustee or the Delaware Trustee, any vice president,
assistant vice president, any assistant secretary, any assistant treasurer, any
trust officer or assistant trust officer, or any other officer of such Funding
Note Indenture Trustee, such Indenture Trustee or the Delaware Trustee, as the
case may be, customarily performing functions similar to those performed by any
of the above designated officers and also, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his or her knowledge of and familiarity with the particular subject,
and also, with respect to such Funding Note Indenture Trustee and such Indenture
Trustee, having direct responsibility for the administration of the applicable
Funding Note Indenture or the applicable Indenture, as the case may be.
"Securities Laws" has the meaning ascribed in Section 2.2(c).
"Series Instrument" means, with respect to any Trust, the Series Instrument
of the Trust, pursuant to which the Administrative Services Agreement, the
Coordination Agreement, the Name Licensing Agreement, the Support Agreement, the
Terms Agreement, the Trust Agreement, the Indenture and the Funding Note
Indenture are entered into, and certain other documents are executed, in
connection with the issuance of the Notes by the Trust.
"Service Provider" has the meaning set forth in the Amended and Restated
Support Agreement.
"Standard Indenture Terms" means those certain Standard Indenture Terms
relating to the Program in the form filed as Exhibit 4.4 to the Registration
Statement.
"Support Agreement" means, with respect to any Trust, that certain Support
and Expenses Agreement included in Part C of the Series Instrument for the
Trust, as the same may be amended, supplemented, modified, restated or replaced
from time to time.
"Support Obligations" has the meaning ascribed in the Amended and Restated
Support Agreement.
"S&P" means Standard & Poor's Ratings Services, a Division of The
McGraw-Hill Companies, Inc.
5
"Terms Agreement" means, with respect to any Trust, that certain Terms
Agreement related to the offering of the Notes of such Trust, included in Part E
of the Series Instrument for the Trust, by and among Global Funding, the Trust
and each Agent named therein, which will incorporate by reference the terms of
the Distribution Agreement.
"Trust" has the meaning ascribed in the third recital.
"Trust Agreement" means, with respect to any Trust, that certain Trust
Agreement, included in Part A of the Series Instrument for the Trust, pursuant
to which the Trust is created.
SECTION 1.2. Other Definitional Provisions. For all purposes of this
Amended and Restated Administrative Services Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article shall have the meanings ascribed to
them in this Article and shall include the plural as well as the
singular;
(b) the words "include", "includes" and "including" shall be construed to
be followed by the words "without limitation";
(c) Article and Section headings are for the convenience of the reader and
shall not be considered in interpreting this Amended and Restated
Administrative Services Agreement or the intent of the parties to this
Amended and Restated Administrative Services Agreement; and
(d) capitalized terms not otherwise defined in this Amended and Restated
Administrative Services Agreement will have the respective meanings
set forth in the Standard Indenture Terms.
ARTICLE 2
CONTINUATION OF APPOINTMENT; ADMINISTRATIVE SERVICES
SECTION 2.1. Appointment. Pursuant to Section 3806(b)(7) of the Delaware
Statutory Trust Act, the Administrator has previously been appointed, and will
continue to be appointed, hereunder as an agent of Global Funding with full
power and authority to carry out, and the Administrator has carried out, and
agrees to continue to carry out, all of the duties and responsibilities (a) of
Global Funding under the Program Documents and any other document to which
Global Funding is a party from time to time and (b) of the Administrator under
this Amended and Restated Administrative Services Agreement.
SECTION 2.2. Administrative Services. Without limiting the generality of
Section 2.1, Global Funding authorizes and empowers the Administrator, as its
agent, to
6
continue to perform, and the Administrator agrees to continue to
perform, the following services:
(a) subject to the timely receipt of all necessary information, providing,
or causing to be provided, all clerical, and bookkeeping services
necessary and appropriate for the administration of Global Funding,
including, without limitation, the following services as well as those
other services specified in the following subsections:
(i) maintenance of all books and records of Global Funding relating
to the fees, costs and expenses of Global Funding which books and
records shall be maintained separately from those of the
Administrator;
(ii) maintenance of records of cash payments and disbursements of
Global Funding in accordance with generally accepted accounting
principles, and preparation for audit of such periodic financial
statements as may be necessary or appropriate;
(iii) upon request, preparation for execution by Global Funding,
through a Responsible Officer, of amendments to and waivers under
the Program Documents and any other documents or instruments
deliverable by Global Funding thereunder or in connection
therewith;
(iv) holding, maintaining, and preserving executed copies of the
Program Documents and other documents or instruments executed by
Global Funding thereunder or in connection therewith, which shall
be maintained separately from those of the Administrator;
(v) upon receipt of notice, taking such action as may be reasonably
necessary to enforce the performance by the other parties to
agreements to which Global Funding is a party, and enforce the
obligations of those parties to Global Funding under such
agreements;
(vi) upon request, preparing for execution by a Responsible Officer
such notices, consents, instructions and other communications
that Global Funding may from time to time be required or
permitted to give under the Program Documents or any other
document executed by Global Funding;
(vii) obtaining services of outside counsel, accountants and other
Service Providers on behalf of Global Funding;
7
(viii) preparing for execution by a Responsible Officer any
instruction for payment of any amounts due and owing by Global
Funding under theProgram Documents to which Global Funding is a
party or any other document to which Global Funding is a party;
provided that the foregoing shall not obligate the Administrator
to advance any of its own monies for such purpose, it being
understood that such amounts shall be payable only to the extent
assets held in Global Funding are available therefor and at such
times and in such amounts as shall be permitted by the Program
Documents;
(ix) preparing for execution by a Responsible Officer any instruction
for payment of any amounts due and owing by Global Funding to any
Indenture Trustee, any Funding Note Indenture Trustee, any
Exchange Rate Agent, any Funding Note Exchange Rate Agent, any
Paying Agent, any Funding Note Paying Agent, any Registrar, any
Funding Note Registrar, any Calculation Agent, any Funding Note
Calculation Agent, any other Service Providers and any other
Person on request for all expenses, disbursements and advances to
the extent not paid pursuant to the Amended and Restated Support
Agreement; provided that the foregoing shall not obligate the
Administrator to advance any of its own monies for such purpose,
it being understood that such amounts shall be payable only to
the extent assets held in Global Funding are available therefor
and at such times and in such amounts as shall be permitted by
the Program Documents; and
(x) taking such other actions as may be incidental or reasonably
necessary (A) to the accomplishment of the actions of the
Administrator authorized in this subsection (a) or (B) upon
receipt of notice from a Responsible Officer directing
specifically the Administrator to do so, to the accomplishment of
the duties and responsibilities, and compliance with the
obligations, of Global Funding, under the Program Documents and
under any other document to which Global Funding is or may be a
party to the extent not otherwise performed by an Indenture
Trustee, a Funding Note Indenture Trustee, an Exchange Rate
Agent, a Funding Note Exchange Rate Agent, a Paying Agent, a
Funding Note Paying Agent, a Registrar, a Funding Note Registrar,
a Calculation Agent, a Funding Note Calculation Agent or the
Delaware Trustee; provided that no such duties or
responsibilities shall materially enlarge the duties and
responsibilities of the Administrator which are set forth
specifically in this Amended and Restated Administrative Services
Agreement;
8
(b) performing the administrative services to ensure compliance with all
of the obligations, representations, covenants and agreements ofGlobal
Funding set forth in the Program Documents and any other document to
which Global Funding is a party;
(c) subject to the timely receipt of all necessary information or notices
from the Delaware Trustee, and based on the advice of counsel, on
behalf of Global Funding: (i) the preparation and filing with the
Securities and Exchange Commission (the "Commission") and, if
necessary, executing, in each case solely on behalf of Global Funding
or any Trust and not in the Administrator's individual capacity such
documents, forms, certifications or filings as may be required by the
Securities Act of 1933, as amended, the Securities Exchange Act of
1934, as amended, the Trust Indenture Act of 1939, as amended, or
other securities laws (collectively, the "Securities Laws"), in
accordance with the requirements of the applicable Securities Laws and
regulations pursuant to such Securities Laws in connection with the
Program; (ii) the preparation and filing of any documents or forms
required to be filed by any rules or regulations of any securities
exchange, including without limitation, the New York Stock Exchange,
or market quotation dealer system or the National Association of
Securities Dealers, Inc. in connection with the listing of any Funding
Note and/or Notes thereon; and (iii) the preparation, filing and
execution, solely on behalf of Global Funding or any Trust and not in
the Administrator's individual capacity, such filings, applications,
reports, surety bonds, irrevocable consents, appointments of attorney
for service of process and other papers and documents as may be
necessary or desirable under the securities or "Blue Sky" laws of any
relevant jurisdictions; and
(d) undertaking such other administrative services as may be reasonably
requested by Global Funding or the Delaware Trustee, including causing
the preparation by Global Funding of any prospectus, prospectus
supplement, pricing supplement, registration statement, amendments,
including any exhibits and schedules thereto relating to the Program,
any reports or other filings or documents, or supplement thereto or
complying with the securities or "Blue Sky" laws of any relevant
jurisdictions in connection with the performance by Global Funding of
its obligations under the Program Documents or any other document to
which Global Funding is a party or other documents executed thereunder
or in connection therewith.
Any of the above services (other than those described in Sections 2.2(b),
2.2(c) and 2.2(d)) may, if the Administrator or Global Funding deems it
necessary or desirable, be subcontracted by the Administrator; provided that
notice is given to Global Funding (with a copy to Allstate Life) of such
subcontract and, notwithstanding such
9
subcontract, the Administrator shall remain responsible for performance of the
services set forth above unless such services are subcontracted to accountants
or legal counsel selected with due care by the Administrator and reasonably
satisfactory to Global Funding and Allstate Life and in which case the
Administrator shall not remain responsible for the performance of such services
and the Administrator shall not, in any event, be responsible for the costs,
fees or expenses in connection therewith.
SECTION 2.3. Continuation of the Base Administrative Services Agreement.
The parties hereto agree that, upon the execution of this Amended and Restated
Administrative Services Agreement:
(a) the Base Administrative Services Agreement shall continue in full
force and effect as amended and restated by this Amended and Restated
Administrative Services Agreement; and
(b) the rights and obligations of the parties hereto shall be as provided
in this Amended and Restated Administrative Services Agreement.
ARTICLE 3
ACTIVITIES OF GLOBAL FUNDING; EMPLOYEES; OFFICES.
SECTION 3.1. Activities of Global Funding. The Administrator agrees to
continue to carry out and perform the administrative activities of Global
Funding set forth in Article 2 in the name and on behalf of Global Funding as
its agent.
SECTION 3.2. Employees. All services to be furnished by the Administrator
under this Amended and Restated Administrative Services Agreement may be
furnished by an officer or employee of the Administrator, an officer or employee
of any Affiliate of the Administrator, or, subject to Article 2, any other
person or agent designated or retained by it; provided that the Administrator
shall remain ultimately responsible for the provision of such services by an
officer or employee of the Administrator or any of its Affiliates or any other
person or agent designated or retained by it, unless selected with due care and
reasonably satisfactory to Global Funding and Allstate Life in accordance with
the last paragraph of Article 2. No director, officer or employee of the
Administrator or any Affiliate of the Administrator shall receive from Global
Funding a salary or other compensation.
SECTION 3.3. Offices. The Administrator agrees to provide its own office
space, together with appropriate materials and any necessary support personnel,
for the day to day activities of Global Funding set forth in Article 2 to be
carried out and performed by the Administrator, all for the compensation
specified in Article 4. Unless otherwise agreed in writing, all services to be
furnished by the Administrator under this Amended and Restated Administrative
Services Agreement shall be performed from the Administrator's office in North
Carolina.
10
ARTICLE 4
COMPENSATION; INDEMNITIES
SECTION 4.1. Compensation. For services provided under this Amended and
Restated Administrative Services Agreement by the Administrator, Global Funding
agrees to pay the Administrator the fees as set forth in a separate fee letter
executed by Global Funding and the Administrator.
SECTION 4.2. Indemnities. To the fullest extent permitted under applicable
law and subject to limitations imposed by public policy, Global Funding agrees
to indemnify the Administrator, and hold the Administrator harmless, from and
against any and all losses, liabilities (including liabilities for penalties),
actions, suits, judgments, demands, damages, out-of-pocket costs and expenses
(including, without limitation, interest and reasonable attorneys fees, but
excluding costs and expenses attributable solely to administrative overhead)
arising out of, in connection with, or resulting from the exercise of the
Administrator's rights and/or the performance of the Administrator's duties, by
the Administrator or its agents and employees, under this Amended and Restated
Administrative Services Agreement (collectively, "Loss and Expense"); provided,
however, Global Funding shall not be liable to indemnify the Administrator, or
hold the Administrator harmless, from and against any and all Loss and Expense
resulting from or attributable to the negligence, bad faith or willful
misconduct of the Administrator.
ARTICLE 5
TERM
SECTION 5.1. Term. The Administrator may terminate this Amended and
Restated Administrative Services Agreement upon at least 30 days' written notice
to Global Funding and Allstate Life and Global Funding may terminate this
Amended and Restated Administrative Services Agreement upon at least 30 days'
notice to the Administrator (copies of any notice of termination shall also be
sent to Allstate Life, the Delaware Trustee, each Funding Note Indenture Trustee
and each Indenture Trustee). Such termination will not become effective until:
(i) Global Funding appoints a successor Administrator; (ii) the successor
Administrator accepts such appointment; (iii) the Administrator has obtained the
prior written confirmation of any Rating Agency that such action will not result
in a reduction or withdrawal of its then current ratings, if any, of the Program
and/or any Notes, as applicable; and (iv) Global Funding has paid all accrued
and unpaid amounts owed to the Administrator under this Amended and Restated
Administrative Services Agreement.
ARTICLE 6
OBLIGATION TO SUPPLY INFORMATION
SECTION 6.1. Obligation to Supply Information. The Delaware Trustee shall
forward to the Administrator such information (which is in the possession of
11
Global Funding) in connection with the Program, the Program Documents and this
Amended and Restated Administrative Services Agreement as the Administrator may
from time to time reasonably request in connection with the performance of its
obligations under this Amended and Restated Administrative Services Agreement.
The Administrator will: (a) hold and safely maintain all records, files, Program
Documents and other material of Global Funding, and (b) permit Global Funding,
the Delaware Trustee, and each of their respective officers, directors, agents
and consultants on reasonable notice at any time and from time to time during
normal business hours to inspect, audit, check and make abstracts from the
accounts, records, correspondence, documents and other materials of Global
Funding, or relating to the provision of services and facilities under this
Amended and Restated Administrative Services Agreement.
SECTION 6.2. Reliance on Information. Global Funding recognizes that the
accuracy and completeness of the records maintained and the information supplied
by the Administrator under this Amended and Restated Administrative Services
Agreement is dependent upon the accuracy and completeness of the information
obtained by the Administrator from the parties to the Program Documents and
other sources and the Administrator shall not be responsible for any inaccurate
or incomplete information so obtained or for any inaccurate or incomplete
records maintained by the Administrator under this Amended and Restated
Administrative Services Agreement that may result therefrom. The Administrator
shall have no duty to investigate the accuracy or completeness of any
information provided to it and shall be entitled to fully rely on all such
information provided to it.
ARTICLE 7
LIABILITY OF ADMINISTRATOR; STANDARD OF CARE
SECTION 7.1. Liability of Administrator. The Administrator assumes no
liability for anything other than the services rendered by it pursuant to
Articles 2, 3, 6 and 9, and neither the Administrator nor any of its directors,
officers, employees or Affiliates shall be responsible for any action of Global
Funding, the Delaware Trustee or the officers or employees thereof taken outside
the scope of Articles 2, 3, 6 and 9 and without direction from the
Administrator. Without limiting the generality of the foregoing, it is agreed
that the Administrator assumes no liability with respect to any of Global
Funding's obligations under the Program Documents.
SECTION 7.2. No Implied Obligations. Unless otherwise agreed in writing,
the Administrator shall not perform, endeavor to perform or agree to perform any
act on behalf of Global Funding not specifically required or permitted under the
Program Documents.
SECTION 7.3. Standard of Care. The Administrator shall perform its duties
under this Amended and Restated Administrative Services Agreement diligently, in
conformity with Global Funding's obligations under the Program Documents and
12
applicable laws and regulations and in accordance with the same standard of care
exercised by a prudent person in connection with the performance of the same or
similar duties and, in no event with less care than the Administrator exercises
or would exercise in connection with the same or similar obligations if those
obligations were the direct obligations of the Administrator.
ARTICLE 8
LIMITED RECOURSE
SECTION 8.1. Limited Recourse to Global Funding. Notwithstanding anything
to the contrary contained in this Amended and Restated Administrative Services
Agreement, all obligations of Global Funding under this Amended and Restated
Administrative Services Agreement shall be payable: (i) to the extent any such
obligation constitutes a Support Obligation, by Allstate Life pursuant to and in
accordance with the terms of the Amended and Restated Support Agreement; and
(ii) to the extent any such obligation does not constitute a Support Obligation,
by Global Funding, only to the extent of funds available therefor under and in
accordance with the terms of each applicable Funding Note Indenture and, to the
extent such funds are not available or are insufficient for the payment thereof,
such unavailability or insufficiency of funds shall not constitute a claim
against Global Funding to the extent of such unavailability or insufficiency.
This Section 8.1 shall survive the termination of this Amended and Restated
Administrative Services Agreement.
SECTION 8.2. No Recourse to Trustees and Agents. The obligations of Global
Funding under this Amended and Restated Administrative Services Agreement are
solely the obligations of Global Funding and no recourse shall be had with
respect to this Amended and Restated Administrative Services Agreement or any of
the obligations of Global Funding under this Amended and Restated Administrative
Services Agreement or for the payment of any fee or other amount payable under
this Amended and Restated Administrative Services Agreement or for any claim
based on, arising out of or relating to any provision of this Amended and
Restated Administrative Services Agreement against any trustee, employee,
settlor, Affiliate, agent or servant of Global Funding. This Section 8.2 shall
survive the termination of this Amended and Restated Administrative Services
Agreement.
ARTICLE 9
TAX MATTERS
SECTION 9.1. Income Tax Treatment. The Administrator agrees that for all
United States Federal, state and local income and franchise tax purposes: (a)
the Notes are intended to be treated as indebtedness of Allstate Life; and (b)
it is intended that Global Funding and each Trust will be ignored and will not
be treated as an association or a publicly traded partnership taxable as a
corporation. The Administrator agrees to not take any action inconsistent with
the treatment described in clauses (a) and (b) of the immediately preceding
sentence unless otherwise required by law.
13
ARTICLE 10
MISCELLANEOUS
SECTION 10.1. Amendments. No waiver, alteration, modification, amendment or
supplement of the terms of this Amended and Restated Administrative Services
Agreement shall be effective unless: (a) accomplished by written instrument
signed by the parties to this Amended and Restated Administrative Services
Agreement; and (b) for so long as any Notes remain outstanding, each of Moody's
and S&P has confirmed in writing that such action will not result in reduction
or withdrawal of its then current ratings, if any, of the Program and/or any
Notes, as applicable. Global Funding shall provide each of Moody's and S&P with
a copy of each such waiver, alteration, modification, amendment or supplement.
Notwithstanding anything in this Section 10.1 to the contrary, no waiver,
alteration, modification, amendment or supplement to the terms of this Amended
and Restated Administrative Services Agreement shall be effective without the
prior written consent of Allstate Life.
SECTION 10.2. No Joint Venture. Nothing contained in this Amended and
Restated Administrative Services Agreement shall constitute Global Funding and
the Administrator as members of any partnership, joint venture, association,
syndicate or unincorporated business.
SECTION 10.3. Assignment. Except as set forth in this Section 10.3, and
subject to the rights of the Administrator to subcontract its services under
this Amended and Restated Administrative Services Agreement pursuant to Article
2, this Amended and Restated Administrative Services Agreement may not be
assigned by either party without: (i) the prior written consent of the other
party and Allstate Life; and (ii) the prior written confirmation of each of
Moody's and S&P that such action will not result in a reduction or withdrawal of
its then current ratings, if any, of the Program or any Notes, as applicable.
Subject to the foregoing, this Amended and Restated Administrative Services
Agreement shall be binding upon and inure to the benefit of the parties to this
Amended and Restated Administrative Services Agreement and their respective
successors and assigns. Any party's transfer or assignment of this Amended and
Restated Administrative Services Agreement in violation of this Section 10.3
shall be void as to the other party.
SECTION 10.4. Governing Law; Consent to Jurisdiction; Waiver of Jury Trial.
(a) Pursuant to Section 5-1401 of the General Obligations Law of the State
of New York, this Amended and Restated Administrative Services
Agreement shall be governed by and construed in accordance with the
laws of the State of New York. Each party to this Amended and Restated
Administrative Services Agreement submits to the nonexclusive
jurisdiction of the United States District Court for the Southern
District of New York and of any New York State Court sitting in New
14
York City for purposes of all legal proceedings arising out of or
relating to this Amended and Restated Administrative Services
Agreement or the transactions contemplated by this Amended and
Restated Administrative Services Agreement. Each party to this Amended
and Restated Administrative Services Agreement irrevocably waives, to
the fullest extent permitted by law, any objection which it may have
to the laying of the venue of any such proceeding brought in such a
court and any claim that any such proceeding brought in such a court
has been brought in an inconvenient forum. Each party to this Amended
and Restated Administrative Services Agreement consents to process
being served in any suit, action or proceeding with respect to this
Amended and Restated Administrative Services Agreement, or any
document delivered pursuant to this Amended and Restated
Administrative Services Agreement by the mailing of a copy thereof by
registered or certified mail, postage prepaid, return receipt
requested, to its respective address specified at the time for notices
under this Amended and Restated Administrative Services Agreement or
to any other address of which it shall have given written notice to
the other party. The foregoing shall not limit the ability of any
party to this Amended and Restated Administrative Services Agreement
to bring suit in the courts of any other jurisdiction.
(b) Each of the parties irrevocably waives any and all right to a trial by
jury with respect to any legal proceeding arising out of or relating
to this Amended and Restated Administrative Services Agreement or any
transaction contemplated hereby. Each of the parties to this Amended
and Restated Administrative Services Agreement acknowledges that such
waiver is made with full understanding and knowledge of the nature of
the rights and benefits waived.
SECTION 10.5. Counterparts. This Amended and Restated Administrative
Services Agreement and any amendments, supplements, modifications, restatements
and replacements of this Amended and Restated Administrative Services Agreement,
or waivers or consents to this Amended and Restated Administrative Services
Agreement, may be executed in any number of counterparts, and by different
parties to this Amended and Restated Administrative Services Agreement in
separate counterparts, each of which, when so executed and delivered, shall be
deemed to be an original and all of which counterparts, when taken together,
shall constitute one and the same instrument. This Amended and Restated
Administrative Services Agreement shall become effective upon the execution of a
counterpart by each of the parties.
SECTION 10.6. Limitation of Delaware Trustee Liability. Notwithstanding any
provision of this Amended and Restated Administrative Services Agreement to the
contrary, it is expressly understood and agreed by the parties that: (a) this
Amended and Restated Administrative Services Agreement is executed and delivered
by the Delaware Trustee, not individually or personally, but solely as trustee,
15
as applicable, in the exercise of the powers and authority conferred and vested
in it, pursuant to the Amended and Restated Trust Agreement; (b) each of the
representations, undertakings and agreements in this Amended and Restated
Administrative Services Agreement made on the part of Global Funding is made and
intended not as personal representations, undertakings and agreements by the
Delaware Trustee but is made and intended for the purpose of binding only Global
Funding; (c) nothing contained in this Amended and Restated Administrative
Services Agreement shall be construed as creating any liability on the Delaware
Trustee, individually or personally, to perform any covenant either expressed or
implied contained in this Amended and Restated Administrative Services
Agreement, all such liability, if any, being expressly waived by the parties to
this Amended and Restated Administrative Services Agreement and by any person
claiming by, through or under the parties to this Amended and Restated
Administrative Services Agreement; and (d) under no circumstances shall the
Delaware Trustee be personally liable for the payment of any indebtedness or
expenses of Global Funding or be liable for the breach or failure of any
obligation, representation, warranty or covenant made or undertaken by Global
Funding under this Amended and Restated Administrative Services Agreement or any
other related documents.
SECTION 10.7. No Petition. The Administrator covenants and agrees that it
will not institute against, or join with any other Person in instituting
against, Global Funding any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceedings, or other proceedings under any federal or state
bankruptcy or similar law. This Section 10.7 shall survive termination of this
Amended and Restated Administrative Services Agreement.
SECTION 10.8. Severability. If any provision in this Amended and Restated
Administrative Services Agreement shall be invalid, illegal or unenforceable,
such provisions shall be deemed severable from the remaining provisions of this
Amended and Restated Administrative Services Agreement and shall in no way
affect the validity or enforceability of such other provisions of this Amended
and Restated Administrative Services Agreement.
SECTION 10.9. Entire Agreement. This Amended and Restated Administrative
Services Agreement constitutes the entire agreement between the parties with
respect to matters covered by this Amended and Restated Administrative Services
Agreement and supersedes all prior agreements and understandings with respect to
such matters between the parties whether written or oral.
SECTION 10.10. Administrator to Provide Access to Books and Records. The
Administrator shall provide each Funding Note Indenture Trustee and each
Indenture Trustee with access to the books and records of Global Funding,
without charge, but only: (a) upon the reasonable request of such Funding Note
Indenture Trustee or Indenture Trustee (for which purpose one Business Day shall
be deemed reasonable); (b) during normal business hours; (c) subject to the
Administrator's normal security and confidentiality procedures; and (d) at
offices designated by the Administrator.
16
SECTION 10.11. No Waiver. No failure on the part of the parties to this
Amended and Restated Administrative Services Agreement to exercise, and no delay
in exercising, and no course of dealing with respect to, any right, power or
privilege under this Amended and Restated Administrative Services Agreement
shall operate as a waiver thereof, nor shall any single or partial exercise
thereof or the exercise of any other right, power or privilege operate as such a
waiver.
SECTION 10.12. Remedies Cumulative. No right, power or remedy of the
parties under this Amended and Restated Administrative Services Agreement shall
be exclusive of any other right, power or remedy, but shall be cumulative and in
addition to any other right, power or remedy thereunder or existing by law or in
equity.
SECTION 10.13. Notices. All notices, demands, instructions and other
communications required or permitted to be given to or made upon either party to
this Amended and Restated Administrative Services Agreement shall be in writing
(including by facsimile transmission) and shall be personally delivered or sent
by guaranteed overnight delivery or by facsimile transmission (to be followed by
personal or guaranteed overnight delivery) and shall be deemed to be given for
purposes of this Amended and Restated Administrative Services Agreement on the
day that such writing is received by the intended recipient thereof in
accordance with the provisions of this Section 10.13. Unless otherwise specified
in a notice sent or delivered in accordance with the foregoing provisions of
this Section 10.13, notices, demands, instructions and other communications in
writing shall be given to or made upon the respective parties thereto at their
respective addresses (or their respective telecopy numbers) indicated below:
If to Global Funding:
c/o Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, DE 19890
Attention: Corporate Trust Administration
Facsimile: (302) 636-4140
If to the Administrator:
AMACAR Pacific Corp.
6525 Morrison Blvd., Suite 318
Charlotte, North Carolina 28211
Attention: Douglas K. Johnson
Facsimile: (704) 365-1632
or at such address as shall be designated by any party in a written notice to
the other party.
17
IN WITNESS WHEREOF, the parties hereto have caused this Amended and
Restated Administrative Services Agreement to be duly executed as of the day and
year first above written.
ALLSTATE LIFE GLOBAL FUNDING
By: WILMINGTON TRUST COMPANY, not in
its individual capacity,
but solely as Delaware Trustee
By:
---------------------------------------
Name:
Title:
AMACAR PACIFIC CORP.,
in its individual capacity
By:
---------------------------------------
Name:
Title:
18
EXHIBIT 10.8
===============================================================================
STANDARD ADMINISTRATIVE SERVICES AGREEMENT TERMS
with respect to
ALLSTATE LIFE GLOBAL FUNDING TRUSTS
===============================================================================
TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS; OTHER DEFINITIONAL PROVISIONS
SECTION 1.1 Definitions....................................................................1
SECTION 1.2 Other Definitional Provisions..................................................4
ARTICLE 2
APPOINTMENT; ADMINISTRATIVE SERVICES
SECTION 2.1 Appointment....................................................................5
SECTION 2.2 Administrative Services........................................................5
ARTICLE 3
ACTIVITIES OF THE TRUST; EMPLOYEES; OFFICES.
SECTION 3.1 Activities of the Trust........................................................8
SECTION 3.2 Employees......................................................................8
SECTION 3.3 Offices........................................................................9
ARTICLE 4
COMPENSATION; INDEMNITIES
SECTION 4.1 Compensation...................................................................9
SECTION 4.2 Indemnities....................................................................9
ARTICLE 5
TERM
SECTION 5.1 Term...........................................................................9
ARTICLE 6
OBLIGATION TO SUPPLY INFORMATION; RELIANCE ON INFORMATION; COVENANTS
SECTION 6.1 Obligation to Supply Information..............................................10
SECTION 6.2 Reliance on Information.......................................................10
SECTION 6.3 Covenants.....................................................................10
ARTICLE 7
LIABILITY OF ADMINISTRATOR; STANDARD OF CARE
SECTION 7.1 Liability of Administrator....................................................10
SECTION 7.2 No Implied Obligations........................................................11
i
SECTION 7.3 Standard of Care..............................................................11
ARTICLE 8
LIMITED RECOURSE
SECTION 8.1 Limited Recourse to Trust.....................................................11
SECTION 8.2 No Recourse Against Certain Persons...........................................11
ARTICLE 9
TAX MATTERS
SECTION 9.1 Income Tax Treatment..........................................................11
ARTICLE 10
MISCELLANEOUS
SECTION 10.1 Amendments....................................................................12
SECTION 10.2 No Joint Venture..............................................................12
SECTION 10.3 Assignment....................................................................12
SECTION 10.4 Governing Law, Consent to Jurisdiction; Waiver of Jury Trial..................12
SECTION 10.5 Counterparts..................................................................13
SECTION 10.6 Limitation of Delaware Trustee Liability......................................13
SECTION 10.7 No Petition...................................................................14
SECTION 10.8 Severability..................................................................14
SECTION 10.9 Entire Agreement..............................................................14
SECTION 10.10 Administrator to Provide Access to Books and Records..........................14
SECTION 10.11 No Waiver.....................................................................14
SECTION 10.12 Remedies Cumulative...........................................................15
SECTION 10.13 Notices.......................................................................15
ii
This document constitutes the Standard Administrative Services Agreement
Terms, which will be incorporated by reference in, and form a part of, the
Administrative Services Agreement (as defined below).
These Standard Administrative Services Agreement Terms shall be of no force
and effect unless and until incorporated by reference in, and then only to the
extent not modified by, the Administrative Services Agreement.
These Standard Administrative Services Agreement Terms shall govern the
administration of the activities of the Trust, subject to contrary terms and
provisions expressly adopted in the Administrative Services Agreement, which
contrary terms shall be controlling.
ARTICLE 1
DEFINITIONS; OTHER DEFINITIONAL PROVISIONS
SECTION 1.1 Definitions.
"Administration Fee" has the meaning ascribed in Section 4.1.
"Administrative Services Agreement" means that certain Administrative
Services Agreement included in Part B of the Series Instrument, and which
incorporates by reference these Standard Administrative Services Agreement
Terms, by and between the Trust and the Administrator, as the same may be
amended, supplemented, modified, restated or replaced from time to time.
"Administrator" means AMACAR Pacific Corp., a Delaware corporation, in its
capacity as the sole administrator of the Trust pursuant to the Administrative
Services Agreement, or another entity specified as the Administrator in the
Administrative Services Agreement, and, in each case, its successors.
"Affiliate" means, as applied to any Person, any other Person directly or
indirectly controlling, controlled by, or under common control with, that Person
and, in the case of an individual, any spouse or other member of that
individual's immediate family. For the purposes of this definition, "control"
(including with correlative meanings, the terms "controlling", "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of that Person, whether through the
ownership of voting securities or by contract or otherwise.
"Agents" has the meaning set forth in the Distribution Agreement.
"Allstate Life" means Allstate Life Insurance Company, a stock life
insurance company organized and licensed under the laws of the State of
Illinois, and any successor.
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"Calculation Agent" has the meaning ascribed in the Indenture.
"Closing Instrument" means the Closing Instrument of the Trust, pursuant to
which certain documents are executed in connection with the issuance of the
Notes by the Trust.
"Commission" has the meaning ascribed in Section 2.2(d).
"Coordination Agreement" means that certain Coordination Agreement included
in Part F of the Series Instrument, among the Trust and the other parties
specified therein, as the same may be amended, supplemented, modified, restated
or replaced from time to time.
"Delaware Trustee" means Wilmington Trust Company, a Delaware banking
corporation, in its capacity as the sole Delaware trustee of the Trust, or
another entity specified as the Delaware Trustee in the Trust Agreement, and, in
each case, its successors.
"Distribution Agreement" means that certain Distribution Agreement dated as
of -, 2006, by and among Global Funding and the other parties specified
therein, as the same may be amended, supplemented, modified, restated or
replaced from time to time.
"Exchange Rate Agent" has the meaning ascribed in the Indenture.
"Funding Agreement" means each funding agreement issued by Allstate Life to
Global Funding, which is immediately pledged and collaterally assigned by Global
Funding to the Funding Note Indenture Trustee, and immediately thereafter
assigned absolutely to and deposited into the Trust by Global Funding, as the
same may be amended, supplemented, modified, restated or replaced from time to
time.
"Funding Note Indenture" means that certain Funding Note Indenture included
in Part H of the Series Instrument, among the Trust and the other parties
specified therein, as the same may be amended, restated, modified, supplemented
or replaced from time to time.
"Global Funding" means Allstate Life Global Funding, a statutory trust
formed under the laws of the State of Delaware.
"Indenture" means that certain Indenture included in Part G of the Series
Instrument, among the Trust and the other parties specified therein, as the same
may be amended, restated, modified, supplemented or replaced from time to time.
"Indenture Trustee" means J.P. Morgan Trust Company, National Association,
in its capacity as the Indenture Trustee, or another entity specified as the
Indenture Trustee in the Indenture, and, in each case, its successors.
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"Loss and Expense" has the meaning ascribed in Section 4.2.
"Moody's" means Moody's Investors Service, Inc.
"Name Licensing Agreement" means that certain Name Licensing Agreement
included in Part D of the Series Instrument, between Allstate Insurance Company
and the Trust, as the same may be amended, supplemented, modified, restated or
replaced from time to time.
"Notes" has the meaning set forth in the Indenture.
"Paying Agent" has the meaning set forth in the Indenture.
"Person" means any natural person, corporation, limited partnership,
general partnership, joint stock company, joint venture, association, company,
limited liability company, trust (including any beneficiary thereof), bank,
trust company, land trust, business trust or other organization, whether or not
a legal entity, and any government or any agency or political subdivision
thereof.
"Pricing Supplement" means the pricing supplement included as Annex A to
the Series Instrument.
"Program" means the program for the issuance, from time to time, of secured
medium term notes of the Allstate Life Global Funding Trusts.
"Program Documents" means the Notes, the Series Instrument, the Closing
Instrument, the Indenture, the Trust Agreement, the Administrative Services
Agreement, the Support Agreement, the Name Licensing Agreement, the Distribution
Agreement, the Terms Agreement, each Funding Agreement and any other documents
or instruments entered into by, or with respect to, or on behalf of, the Trust.
"Rating Agency" means each of Moody's, S&P, and any other rating agency
which provides a rating of the Notes.
"Registrar" has the meaning set forth in the Indenture.
"Responsible Officer" when used with respect to any Person means the
chairman of the board of directors or any vice chairman of the board of
directors or the president or any vice president (whether or not designated by a
number or numbers or a word or words added before or after the title "vice
president") of such Person. With respect to the Trust, Responsible Officer means
any Responsible Officer (as defined in the preceding sentence) plus any
assistant secretary and any financial services officer of the Delaware Trustee,
and with respect to the Delaware Trustee, Responsible Officer means any
Responsible Officer (as defined in the first sentence of this definition) plus
the chairman of the trust committee, the chairman of the executive committee,
any vice chairman of the executive committee, the cashier, the secretary, the
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treasurer, any trust officer, any assistant trust officer, any assistant vice
president, any assistant cashier, any assistant secretary, any assistant
treasurer, or any other authorized officer of the Delaware Trustee customarily
performing functions similar to those performed by the Persons who at the time
shall be such officers, respectively, or to whom any corporate trust matter is
referred because of his knowledge of and familiarity with the particular
subject.
"S&P" means Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc.
"Series Instrument" means the Series Instrument of the Trust, pursuant to
which the Administrative Services Agreement, the Coordination Agreement, the
Funding Note Indenture, the Indenture, the Name Licensing Agreement, the Support
Agreement, the Terms Agreement and the Trust Agreement are entered into, and
certain other documents are executed, in connection with the issuance of the
Notes by the Trust.
"Service Provider" has the meaning set forth in the Support Agreement.
"Support Agreement" means that certain Support and Expenses Agreement
included in Part C of the Series Instrument, by and between Allstate Life and
the Trust, as the same may be amended, restated, modified, supplemented or
replaced from time to time.
"Support Obligation" has the meaning ascribed in the Support Agreement.
"Survivor's Option" means the provision, if any, in the Notes permitting
optional repayment of such Notes prior to maturity, if requested, following the
death of the beneficial owner of such Notes, in accordance with the terms of the
Notes.
"Terms Agreement" means that certain Terms Agreement related to the
offering of the Notes, included in Part E of the Series Instrument, by and among
Global Funding, the Trust and each Agent specified therein, which will
incorporate by reference the terms of the Distribution Agreement.
"Trust" means the Allstate Life Global Funding Trust specified in the
Series Instrument, together with its permitted successors and assigns.
"Trust Agreement" means that certain Trust Agreement, included in Part A of
the Series Instrument, pursuant to which the Trust is created.
SECTION 1.2 Other Definitional Provisions. For all purposes of the
Administrative Services Agreement, except as otherwise expressly provided or
unless the context otherwise requires:
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(a) the terms defined in this Article shall have the meanings ascribed to
them in this Article and shall include the plural as well as the
singular; provided, that all capitalized terms used in and not
otherwise defined in the Administrative Services Agreement will have
the meanings set forth in the Indenture;
(b) the words "include", "includes" and "including" shall be construed to
be followed by the words "without limitation";
(c) Article and Section headings are for the convenience of the reader and
shall not be considered in interpreting the Administrative Services
Agreement or the intent of the parties to the Administrative Services
Agreement; and
(d) capitalized terms not otherwise defined in the Administrative Services
Agreement will have the respective meanings set forth in the
Indenture.
ARTICLE 2
APPOINTMENT; ADMINISTRATIVE SERVICES
SECTION 2.1 Appointment. Pursuant to Section 3806(b)(7) of the Delaware
Statutory Trust Act, the Administrator is hereby appointed, as an agent of the
Trust with full power and authority, and agrees to carry out all of the duties
and responsibilities: (a) of the Trust under the Program Documents and any other
document to which the Trust is a party; and (b) of the Administrator under the
Administrative Services Agreement.
SECTION 2.2 Administrative Services. Without limiting the generality of
Section 2.1, the Trust authorizes and empowers the Administrator, as its agent,
to perform, and the Administrator agrees to perform, the following services:
(a) subject to the timely receipt of all necessary information, providing,
or causing to be provided, all clerical, and bookkeeping services
necessary and appropriate for the administration of the Trust,
including, without limitation, the following services as well as those
other services specified in the following subsections:
(i) maintenance of all books and records of the Trust relating to the
fees, costs and expenses of the Trust which books and records
shall be maintained separately from those of the Administrator;
(ii) maintenance of records of cash payments and disbursements
(excluding principal and interest on any Funding Agreement) of
the Trust in accordance with generally accepted accounting
principles, and preparation for audit of such periodic financial
statements as may be necessary or appropriate;
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(iii) upon request, preparing for, and causing, execution by the
Trust, through a Responsible Officer, of the Program Documents,
any amendments to and waivers under the Program Documents and any
other documents or instruments deliverable by the Trust
thereunder or in connection therewith;
(iv) holding, maintaining, and preserving executed copies of the
Program Documents and other documents or instruments executed by
the Trust thereunder or in connection therewith, which shall be
maintained separately from those of the Administrator;
(v) upon receipt of notice, taking such action as may be reasonably
necessary to enforce the performance by the other parties to
agreements to which the Trust is a party, and enforce the
obligations of those parties to the Trust under such agreements;
(vi) upon request, preparing for execution by a Responsible Officer
such notices, consents, instructions and other communications
that the Trust may from time to time be required or permitted to
give under the Program Documents or any other document executed
by the Trust;
(vii) obtaining services of outside counsel, accountants and other
Service Providers on behalf of the Trust;
(viii) preparing for execution by a Responsible Officer any
instruction for payment of any amounts due and owing by the Trust
under the Program Documents to which the Trust is a party or any
other document to which the Trust is a party; provided that the
foregoing shall not obligate the Administrator to advance any of
its own monies for such purpose, it being understood that such
amounts shall be payable only to the extent assets held in the
Trust are available therefor and at such times and in such
amounts as shall be permitted by the Program Documents;
(ix) preparing for execution by a Responsible Officer any instruction
for payment of any amounts due and owing by the Trust to the
Indenture Trustee, any Paying Agent, the Registrar, the Exchange
Agent, the Calculation Agent, other Service Providers and any
other Person on request for all expenses, disbursements and
advances to the extent not paid pursuant to the Support
Agreement; provided, however, that the foregoing shall not
obligate the Administrator to advance any of its own monies for
such purpose, it being understood that such amounts shall be
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payable only to the extent assets held in the Trust are available
therefor and at such times and in such amounts as shall be
permitted by the Program Documents; and
(x) taking such other actions as may be incidental or reasonably
necessary: (A) to the accomplishment of the actions of the
Administrator authorized in this subsection (a); or (B) upon
receipt of notice from a Responsible Officer directing
specifically the Administrator to do so, to the accomplishment of
the duties and responsibilities, and compliance with the
obligations, of the Trust, under the Program Documents and under
any other document to which the Trust is or may be a party to the
extent not otherwise performed by the Indenture Trustee, a Paying
Agent, the Registrar, the Exchange Rate Agent, the Calculation
Agent or the Delaware Trustee; provided that no such duties or
responsibilities shall materially enlarge the duties and
responsibilities of the Administrator which are set forth
specifically in the Administrative Services Agreement;
(b) upon the issuance of the Notes, directing the Indenture Trustee to pay
the expenses of the Trust relating to the Notes to the extent not paid
under the Support Agreement;
(c) performing the administrative services to ensure compliance with all
of the obligations, representations, covenants and agreements of the
Trust set forth in the Program Documents;
(d) subject to the timely receipt of all necessary information or notices
from the Delaware Trustee, and based on the advice of counsel, on
behalf of the Trust, (i) the preparation and filing with the
Securities and Exchange Commission (the "Commission") and, if
necessary, executing, in each case solely on behalf of the Trust and
not in the Administrator's individual capacity such documents, forms,
certifications and filings as may be required by the Securities Act of
1933, as amended, the Securities Exchange Act of 1934, as amended, the
Trust Indenture Act of 1939, as amended, or other securities laws, in
each case relating to the Program and/or the Notes; (ii) the
preparation and filing of any documents or forms required to be filed
by any rules or regulations of any securities exchange, including
without limitation, the New York Stock Exchange, or market quotation
dealer system or the National Association of Securities Dealers, Inc.
in connection with the listing of the Notes thereon; (iii) preparing,
filing and executing solely on behalf of the Trust and not in the
Administrator's individual capacity, such filings, applications,
reports, surety bonds, irrevocable consents, appointments of attorney
for service of process and other papers and documents as may be
7
necessary or desirable to register, or establish the exemption from
registration of, the Notes under the securities or "Blue Sky" laws of
any relevant jurisdictions; and (iv) executing and delivering, solely
on behalf of the Trust and not in the Administrator's individual
capacity, letters or documents to, or instruments for filing with, a
depositary relating to the Notes;
(e) if the Pricing Supplement relating to the Notes provides for a
Survivor's Option, taking such actions as may be incidental or
reasonably necessary to administer the Survivor's Option; and
(f) undertaking such other administrative services as may be reasonably
requested by the Trust or the Delaware Trustee, including: (i) causing
the preparation by the Trust of any prospectus, prospectus supplement,
pricing supplement, registration statement, amendments, including any
exhibits and schedules thereto, any reports or other filings or
documents, or supplement thereto; or (ii) securing and maintaining the
listing of the Notes on any securities exchange or complying with the
securities or "Blue Sky" laws of any relevant jurisdictions, in
connection with the performance by the Trust of its obligations under
the Program Documents or any other document to which the Trust is a
party or other documents executed thereunder or in connection
therewith.
Any of the above services (other than those described in Sections 2.2(c),
2.2(d) and 2.2(e)) may, if the Administrator or the Trust deems it necessary or
desirable, be subcontracted by the Administrator; provided that notice is given
to the Trust of such subcontract and, notwithstanding such subcontract, the
Administrator shall remain responsible for performance of the services set forth
above unless such services are subcontracted to accountants or legal counsel
selected with due care by the Administrator and reasonably satisfactory to the
Trust and in which case the Administrator shall not remain responsible for the
performance of such services and the Administrator shall not, in any event, be
responsible for the costs, fees or expenses in connection therewith.
ARTICLE 3
ACTIVITIES OF THE TRUST; EMPLOYEES; OFFICES.
SECTION 3.1 Activities of the Trust. The Administrator agrees to carry out
and perform the administrative activities of the Trust set forth in Article 2 in
the name and on behalf of the Trust as its agent.
SECTION 3.2 Employees. All services to be furnished by the Administrator
under the Administrative Services Agreement may be furnished by an officer or
employee of the Administrator, an officer or employee of any Affiliate of the
Administrator, or, subject to Article 2, any other person or agent designated or
retained
8
by it; provided that the Administrator shall remain ultimately responsible for
the provision of such services by an officer or employee of the Administrator or
any of its Affiliates or any other person or agent designated or retained by it,
unless selected with due care and reasonably satisfactory to the Trust in
accordance with the last paragraph of Article 2. No director, officer or
employee of the Administrator or any Affiliate of the Administrator shall
receive from the Trust a salary or other compensation.
SECTION 3.3 Offices. The Administrator agrees to provide its own office
space, together with appropriate materials and any necessary support personnel,
for the day to day activities of the Trust set forth in Article 2 to be carried
out and performed by the Administrator, all for the compensation specified in
Article 4. Unless otherwise specified in the Administrative Services Agreement,
all services to be furnished by the Administrator under the Administrative
Services Agreement shall be performed from the Administrator's office in North
Carolina.
ARTICLE 4
COMPENSATION; INDEMNITIES
SECTION 4.1 Compensation. The Trust agrees to pay the Administrator the
fees set forth in or pursuant to the Administrative Services Agreement (the
"Administration Fee").
SECTION 4.2 Indemnities. To the fullest extent permitted under applicable
law and subject to limitations imposed by public policy, the Trust agrees to
indemnify the Administrator, and hold the Administrator harmless, from and
against any and all losses, liabilities (including liabilities for penalties),
actions, suits, judgments, demands, damages, out-of-pocket costs and expenses
(including, without limitation, interest and reasonable attorneys fees, but
excluding costs and expenses attributable solely to administrative overhead)
arising out of, in connection with, or resulting from the exercise of the
Administrator's rights and/or the performance of the Administrator's duties, by
the Administrator or its agents and employees, under the Administrative Services
Agreement (collectively, "Loss and Expense"); provided, however, that the Trust
shall not be liable to indemnify the Administrator, or hold the Administrator
harmless, from and against any and all Loss and Expense resulting from or
attributable to the negligence, bad faith or willful misconduct of the
Administrator.
ARTICLE 5
TERM
SECTION 5.1 Term. The Administrator may terminate the Administrative
Services Agreement upon at least 30 days' written notice to the Trust and
Allstate Life and the Trust may terminate the Administrative Services Agreement
upon at least 30 days' notice to the Administrator (copies of any notice of
termination shall also be sent to the Indenture Trustee). Such termination will
not become effective until (a) the Trust appoints a successor Administrator; (b)
the successor Administrator accepts such appointment; (c) the Administrator has
9
obtained the prior written confirmation of each Rating Agency that such action
will not result in a reduction or withdrawal of its then current ratings, if
any, of the Program and/or the Notes, as applicable; and (d) the Trust has paid
all accrued and unpaid amounts owed to the Administrator under the
Administrative Services Agreement.
ARTICLE 6
OBLIGATION TO SUPPLY INFORMATION; RELIANCE ON INFORMATION; COVENANTS
SECTION 6.1 Obligation to Supply Information. The Delaware Trustee shall
forward to the Administrator such information (which is in the possession of the
Trust) in connection with the Program Documents and the Administrative Services
Agreement as the Administrator may from time to time reasonably request in
connection with the performance of its obligations under the Administrative
Services Agreement. The Administrator will: (a) hold and safely maintain all
records, files, Program Documents and other material of the Trust; and (b)
permit the Trust, the Delaware Trustee, and each of their respective officers,
directors, agents and consultants on reasonable notice at any time and from time
to time during normal business hours to inspect, audit, check and make abstracts
from the accounts, records, correspondence, documents and other materials of the
Trust, or relating to the provision of services and facilities under the
Administrative Services Agreement.
SECTION 6.2 Reliance on Information. The Trust recognizes that the accuracy
and completeness of the records maintained and the information supplied by the
Administrator under the Administrative Services Agreement is dependent upon the
accuracy and completeness of the information obtained by the Administrator from
the parties to the Program Documents and other sources and the Administrator
shall not be responsible for any inaccurate or incomplete information so
obtained or for any inaccurate or incomplete records maintained by the
Administrator under the Administrative Services Agreement that may result
therefrom. The Administrator shall have no duty to investigate the accuracy or
completeness of any information provided to it and shall be entitled to fully
rely on all such information provided to it.
SECTION 6.3 Covenants. The Trust repeats and reaffirms to the Administrator
the covenants of the Trust set forth in Article 4 of the Indenture.
ARTICLE 7
LIABILITY OF ADMINISTRATOR; STANDARD OF CARE
SECTION 7.1 Liability of Administrator. The Administrator assumes no
liability for anything other than the services rendered by it pursuant to
Articles 2, 3, 6 and 9, and neither the Administrator nor any of its directors,
officers, employees or Affiliates shall be responsible for any action of the
Trust, the Delaware Trustee or the officers or employees thereof taken outside
the scope of Articles 2, 3, 6 and 9 and without direction from the
Administrator. Without limiting the generality of the foregoing, it is agreed
10
that the Administrator assumes no liability with respect to any of the Trust's
obligations under the Program Documents.
SECTION 7.2 No Implied Obligations. The Administrator shall not perform,
endeavor to perform or agree to perform any act on behalf of the Trust not
specifically required or permitted under the Program Documents.
SECTION 7.3 Standard of Care. The Administrator shall perform its duties
under the Administrative Services Agreement diligently, in conformity with the
Trust's obligations under the Program Documents and applicable laws and
regulations and in accordance with the same standard of care exercised by a
prudent person in connection with the performance of the same or similar duties
and, in no event with less care than the Administrator exercises or would
exercise in connection with the same or similar obligations if those obligations
were the direct obligations of the Administrator.
ARTICLE 8
LIMITED RECOURSE
SECTION 8.1 Limited Recourse to Trust. Notwithstanding anything to the
contrary contained in the Administrative Services Agreement, all obligations of
the Trust under the Administrative Services Agreement shall be payable: (i) to
the extent any such obligation constitutes a Support Obligation, by Allstate
Life pursuant to and in accordance with the terms of the Support Agreement; and
(ii) to the extent any such obligation does not constitute a Support Obligation,
by Global Funding, only to the extent of funds available therefor under and in
accordance with the terms of the Indenture and, to the extent such funds are not
available or are insufficient for the payment thereof, such unavailability or
insufficiency of funds shall not constitute a claim against the Trust to the
extent of such unavailability or insufficiency. This Section 8.1 shall survive
the termination of the Administrative Services Agreement.
SECTION 8.2 No Recourse Against Certain Persons. The obligations of the
Trust under the Administrative Services Agreement are solely the obligations of
the Trust and no recourse shall be had with respect to the Administrative
Services Agreement or any of the obligations of the Trust under the
Administrative Services Agreement or for the payment of any fee or other amount
payable under the Administrative Services Agreement or for any claim based on,
arising out of or relating to any provision of the Administrative Services
Agreement against any trustee, employee, settlor, Affiliate, agent or servant of
the Trust. This Section 8.2 shall survive the termination of the Administrative
Services Agreement.
ARTICLE 9
TAX MATTERS
SECTION 9.1 Income Tax Treatment. The Administrator agrees that for all
United States Federal, state and local income and franchise tax purposes: (i)
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the Notes will be treated as indebtedness of Allstate Life; and (ii) Global
Funding and the Trust will be ignored and will not be treated as an association
or a publicly traded partnership taxable as a corporation. The Administrator
will not take any action inconsistent with the treatment described in the
immediately preceding sentence unless otherwise required by applicable law.
ARTICLE 10
MISCELLANEOUS
SECTION 10.1 Amendments. No waiver, alteration, modification, amendment or
supplement of the terms of the Administrative Services Agreement shall be
effective unless: (a) accomplished by written instrument signed by the parties
to the Administrative Services Agreement; and (b) for so long as any Notes
remain outstanding, each of Moody's and S&P has confirmed in writing that such
action will not result in reduction or withdrawal of its then current ratings,
if any, of the Program and/or the Trust's Notes, as applicable. The Trust shall
provide each of Moody's and S&P with a copy of each such waiver, alteration,
modification, amendment or supplement. Notwithstanding anything in this Section
10.1 to the contrary, no waiver, alteration, modification, amendment or
supplement to the terms of the Administrative Services Agreement shall be
effective without the prior written consent of Allstate Life.
SECTION 10.2 No Joint Venture. Nothing contained in the Administrative
Services Agreement shall constitute the Trust and the Administrator as members
of any partnership, joint venture, association, syndicate or unincorporated
business.
SECTION 10.3 Assignment. Except as set forth in this Section 10.3, and
subject to the rights of the Administrator to subcontract its services under the
Administrative Services Agreement pursuant to Article 2, the Administrative
Services Agreement may not be assigned by either party without: (i) the prior
written consent of the other party and Allstate Life; and (ii) the prior written
confirmation of each of Moody's and S&P that such action will not result in a
reduction or withdrawal of its then current ratings, if any, of the Program
and/or the Notes, as applicable. Subject to the foregoing, the Administrative
Services Agreement shall be binding upon and inure to the benefit of the parties
to the Administrative Services Agreement and their respective successors and
assigns. Any party's transfer or assignment of the Administrative Services
Agreement in violation of this Section 10.3 shall be void as to the other party.
SECTION 10.4 Governing Law, Consent to Jurisdiction; Waiver of Jury Trial.
(a) Pursuant to Section 5-1401 of the General Obligations Law of the State
of New York, the Administrative Services Agreement shall be governed
by and construed in accordance with the laws of the State of New York.
Each party to the Administrative Services Agreement submits to the
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nonexclusive jurisdiction of the United States District Court for the
Southern District of New York and of any New York State Court sitting
in New York City for purposes of all legal proceeding arising out of
or relating to the Administrative Services Agreement or the
transactions contemplated by the Administrative Services Agreement.
Each party to the Administrative Services Agreement irrevocably
waives, to the fullest extent permitted by law, any objection which it
may have to the laying of the venue of any such proceeding brought in
such a court and any claim that any such proceeding brought in such a
court has been brought in an inconvenient forum. Each party to the
Administrative Services Agreement consents to process being served in
any suit, action or proceeding with respect to the Administrative
Services Agreement, or any document delivered pursuant to the
Administrative Services Agreement by the mailing of a copy thereof by
registered or certified mail, postage prepaid, return receipt
requested, to its respective address specified at the time for notices
under the Administrative Services Agreement or to any other address of
which it shall have given written notice to the other party. The
foregoing shall not limit the ability of any party to the
Administrative Services Agreement to bring suit in the courts of any
other jurisdiction.
(b) Each of the parties irrevocably waives any and all right to a trial by
jury with respect to any legal proceeding arising out of or relating
to the Administrative Services Agreement or any transaction. Each of
the parties to the Administrative Services Agreement acknowledges that
such waiver is made with full understanding and knowledge of the
nature of the rights and benefits waived.
SECTION 10.5 Counterparts. The Administrative Services Agreement and any
amendments, supplements, modifications, restatements or replacements of the
Administrative Services Agreement, or waivers or consents to the Administrative
Services Agreement, may be executed in any number of counterparts, and by
different parties to the Administrative Services Agreement in separate
counterparts, each of which, when so executed and delivered, shall be deemed to
be an original and all of which counterparts, when taken together, shall
constitute one and the same instrument. The Administrative Services Agreement
shall become effective upon the execution of a counterpart by each of the
parties.
SECTION 10.6 Limitation of Delaware Trustee Liability. Notwithstanding any
provision of the Administrative Services Agreement to the contrary, it is
expressly understood and agreed by the parties that: (a) the Administrative
Services Agreement is executed and delivered by the Delaware Trustee, not
individually or personally, but solely as trustee, as applicable, in the
exercise of the powers and authority conferred and vested in it, pursuant to the
Trust Agreement; (b) each of the representations, undertakings and agreements in
the Administrative Services Agreement made on the part
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of the Trust is made and intended not as personal representations, undertakings
and agreements by the Delaware Trustee but is made and intended for the purpose
of binding only the Trust; (c) nothing contained in the Administrative Services
Agreement shall be construed as creating any liability on the Delaware Trustee,
individually or personally, to perform any covenant either expressed or implied
contained in the Administrative Services Agreement, all such liability, if any,
being expressly waived by the parties to the Administrative Services Agreement
and by any person claiming by, through or under the parties to the
Administrative Services Agreement; and (d) under no circumstances shall the
Delaware Trustee be personally liable for the payment of any indebtedness or
expenses of the Trust or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Trust under the
Administrative Services Agreement or any other related documents.
SECTION 10.7 No Petition. To the extent permitted by applicable law, the
Administrator covenants and agrees that it will not institute against, or join
with any other Person in instituting against, the Trust any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any applicable bankruptcy or similar law. This Section 10.7
shall survive termination of the Administrative Services Agreement.
SECTION 10.8 Severability. If any provision in the Administrative Services
Agreement shall be invalid, illegal or unenforceable, such provisions shall be
deemed severable from the remaining provisions of the Administrative Services
Agreement and shall in no way affect the validity or enforceability of such
other provisions of the Administrative Services Agreement.
SECTION 10.9 Entire Agreement. The Administrative Services Agreement
constitutes the entire agreement between the parties with respect to matters
covered by the Administrative Services Agreement and supersedes all prior
agreements and understandings with respect to such matters between the parties
whether written or oral.
SECTION 10.10 Administrator to Provide Access to Books and Records. The
Administrator shall provide the Indenture Trustee with access to the books and
records of the Trust, without charge, but only: (a) upon the reasonable request
of the Indenture Trustee (for which purpose one Business Day shall be deemed
reasonable); (b) during normal business hours; (c) subject to the
Administrator's normal security and confidentiality procedures; and (d) at
offices designated by the Administrator.
SECTION 10.11 No Waiver. No failure on the part of the parties to the
Administrative Services Agreement to exercise, and no delay in exercising, and
no course of dealing with respect to, any right, power or privilege under the
Administrative Services Agreement shall operate as a waiver thereof, nor shall
any single or partial exercise thereof or the exercise of any other right, power
or privilege operate as such a waiver.
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SECTION 10.12 Remedies Cumulative. No right, power or remedy of the parties
under the Administrative Services Agreement shall be exclusive of any other
right, power or remedy, but shall be cumulative and in addition to any other
right, power or remedy thereunder or existing by law or in equity.
SECTION 10.13 Notices. All notices, demands, instructions and other
communications required or permitted to be given to or made upon either party to
the Administrative Services Agreement shall be in writing (including by
facsimile transmission) and shall be personally delivered or sent by guaranteed
overnight delivery or by facsimile transmission (to be followed by personal or
guaranteed overnight delivery) and shall be deemed to be given for purposes of
the Administrative Services Agreement on the day that such writing is received
by the intended recipient thereof in accordance with the provisions of this
Section 10.13. Unless otherwise specified in a notice sent or delivered in
accordance with the foregoing provisions of this Section 10.13, notices,
demands, instructions and other communications in writing shall be given to or
made upon the respective parties thereto at their respective addresses (or their
respective telecopy numbers) indicated below:
If to the Trust:
c/o Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, DE 19890
Attention: Corporate Trust Administration
Facsimile: (302) 636-4140
If to the Administrator:
AMACAR Pacific Corp.
6525 Morrison Blvd., Suite 318
Charlotte, North Carolina 28211
Attention: Douglas K. Johnson
Facsimile: (704) 365-1632
or at such other address as shall be designated by any party in a written notice
to the other party.
15
EXHIBIT 10.10
===============================================================================
FORM OF AMENDED AND RESTATED NAME LICENSING AGREEMENT
between
ALLSTATE INSURANCE COMPANY
and
ALLSTATE LIFE GLOBAL FUNDING
Dated as of -, 2006
===============================================================================
TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS
SECTION 1.1 Definitions....................................................................1
SECTION 1.2 Other Definitional Provisions..................................................2
ARTICLE 2
CONTINUATION OF GRANT OF LICENSE; INDEPENDENT CONTRACTORS
SECTION 2.1 Continuation of Grant of License...............................................3
SECTION 2.2 Independent Contractors........................................................3
SECTION 2.3 Continuation of the Base Name Licensing Agreement..............................3
ARTICLE 3
AGREEMENTS AND ACKNOWLEDGEMENTS OF LICENSEE
SECTION 3.1 Agreements and Acknowledgements of Licensee....................................3
ARTICLE 4
INFRINGEMENT PROCEEDINGS
SECTION 4.1 Notification of Unauthorized Use...............................................5
SECTION 4.2 Payments for Damages...........................................................5
ARTICLE 5
TERM AND TERMINATION
SECTION 5.1 Term...........................................................................5
SECTION 5.2 Automatic Termination..........................................................6
SECTION 5.3 Immediate Termination..........................................................6
SECTION 5.4 Termination on Notice..........................................................6
ARTICLE 6
EFFECT OF TERMINATION
SECTION 6.1 Discontinuation of Use of Licensed Marks.......................................6
SECTION 6.2 Licensee Cooperation...........................................................6
SECTION 6.3 Rights in Licensed Marks.......................................................7
i
ARTICLE 7
MISCELLANEOUS
SECTION 7.1 Enforcement....................................................................7
SECTION 7.2 Severability...................................................................7
SECTION 7.3 Entire Agreement...............................................................7
SECTION 7.4 Amendments.....................................................................7
SECTION 7.5 Governing Law..................................................................7
SECTION 7.6 Consent to Jurisdiction........................................................7
SECTION 7.7 Waiver of Jury Trial...........................................................8
SECTION 7.8 No Waiver......................................................................8
SECTION 7.9 Remedies Cumulative............................................................8
SECTION 7.10 Notices........................................................................8
SECTION 7.11 Counterparts...................................................................9
SECTION 7.12 Limitation of Delaware Trustee Liability.......................................9
Appendix A Licensed Marks
ii
This AMENDED AND RESTATED NAME LICENSING AGREEMENT dated as of -, 2006
(this "Amended and Restated Name Licensing Agreement"), between Allstate
Insurance Company ("Licensor"), an Illinois stock insurance company, and
Allstate Life Global Funding ("Licensee"), a statutory trust organized under the
laws of the State of Delaware,
W I T N E S S E T H:
WHEREAS, Licensor and Licensee entered into that certain Name Licensing
Agreement, dated as of April 27, 2004, as amended and restated by the Amended
and Restated Name Licensing Agreement, dated as of August 16, 2005 (as so
amended and restated, the "Base Name Licensing Agreement"), and the parties
hereto desire to amend and restate the Base Name Licensing Agreement in its
entirety;
WHEREAS, Licensor is the owner of the Licensed Marks (as defined below);
WHEREAS, Licensee desires to use the Licensed Marks and use Allstate as
part of its company name; and
WHEREAS, Licensor and Licensee wish to formalize the agreement between them
regarding Licensee's use of the Licensed Marks;
NOW, THEREFORE, in consideration of the mutual promises set forth in this
Amended and Restated Name Licensing Agreement and other good and valuable
consideration, the sufficiency and receipt of which is hereby acknowledged, the
parties agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.1 Definitions. The following terms, as used herein, have the
following meanings:
"Amended and Restated Name Licensing Agreement" means this instrument, as
originally executed, and as the same may be amended, supplemented, modified,
restated or replaced from time to time.
"Amended and Restated Trust Agreement" means that certain Amended and
Restated Trust Agreement of Licensee, dated as of -, 2006, as the same may
be amended, supplemented, modified, restated or replaced from time to time.
"Base Name Licensing Agreement" has the meaning ascribed in the first
recital.
"Delaware Trustee" has the meaning ascribed in Section 7.12.
1
"Licensed Marks" shall include all marks listed on Appendix A attached
hereto as the same may be amended, supplemented, modified, restated or replaced
from time to time.
"Licensed Services" means the activities necessary to accomplish all
purposes of Licensee as set forth in the Amended and Restated Trust Agreement.
"Licensee" means Allstate Life Global Funding, a statutory trust organized
under the laws of the State of Delaware.
"Licensor" means Allstate Insurance Company, an Illinois stock insurance
company, and its successors.
"Person" means any natural person, corporation, limited partnership,
general partnership, joint stock company, limited liability company, joint
venture, association, company, trust (including any beneficiary thereof), bank,
trust company, land trust, business trust or other organization, whether or not
a legal entity, and governments and agencies and political subdivisions thereof.
"Territory" shall mean worldwide.
SECTION 1.2 Other Definitional Provisions. For all purposes of this Amended
and Restated Name Licensing Agreement except as otherwise expressly provided or
unless the context otherwise requires:
(a) the terms defined in this Article shall have the meanings ascribed to
them in this Article and shall include the plural as well as the
singular;
(b) the words "include", "includes" and "including" shall be construed to
be followed by the words "without limitation";
(c) Article and Section headings are for the convenience of the reader and
shall not be considered in interpreting this Amended and Restated Name
Licensing Agreement or the intent of the parties to this Amended and
Restated Name Licensing Agreement;
(d) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Amended and Restated Name Licensing
Agreement as a whole and not to any particular Article, Section,
Appendix or other subdivision; and
(e) references herein to Articles, Sections and Appendices shall, unless
otherwise specified, refer respectively to Articles, Sections and
Appendices hereof.
2
ARTICLE 2
CONTINUATION OF GRANT OF LICENSE; INDEPENDENT CONTRACTORS
SECTION 2.1 Continuation of Grant of License. Licensor has previously
granted to Licensee, and Licensor hereby agrees to continue to grant to Licensee
for the term of this Amended and Restated Name Licensing Agreement, a
nonexclusive, nontransferable right and license to use the Licensed Marks for
the Licensed Services within the Territory. Licensor is not representing that it
has rights with respect to Licensed Marks or the Licensed Marks in every
jurisdiction within the Territory.
SECTION 2.2 Independent Contractors. Licensor and Licensee are independent
contractors and are not, and shall not, represent themselves as principal and
agent, partners or joint venturers.
SECTION 2.3 Continuation of the Base Name Licensing Agreement. The parties
hereto agree that, upon the execution of this Amended and Restated Name
Licensing Agreement:
(a) the Base Name Licensing Agreement shall continue in full force and
effect as amended and restated by this Amended and Restated Name
Licensing Agreement; and
(b) the rights and obligations of the parties hereto shall be as provided
in this Amended and Restated Name Licensing Agreement.
ARTICLE 3
AGREEMENTS AND ACKNOWLEDGEMENTS OF LICENSEE
SECTION 3.1 Agreements and Acknowledgements of Licensee. Licensee
acknowledges and agrees that:
(a) Licensor is the sole owner of the Licensed Marks;
(b) Licensee shall do nothing inconsistent with the ownership of the
Licensed Marks by Licensor;
(c) all use of the Licensed Marks by Licensee shall inure only to the
benefit of and be on behalf of Licensor;
(d) Licensee shall assist Licensor in executing any additional documents
that may be necessary or desirable to effect the protection of
Licensor's interests in Licensed Marks, including, but not limited to,
the execution of any and all documents required by governmental
agencies in order to register or maintain trademark and service mark
registrations; in addition, Licensee shall not oppose Licensor's
registration of the
3
Licensed Marks nor take action that jeopardizes Licensor's rights in
Licensed Marks;
(e) nothing in this Amended and Restated Name Licensing Agreement shall
give Licensee any right, title or interest in Licensed Marks other
than the license granted in this Amended and Restated Name Licensing
Agreement;
(f) Licensee shall not attack or challenge in any way Licensor's rights in
and to Licensed Marks or the validity or enforceability of this
Amended and Restated Name Licensing Agreement;
(g) Licensee shall not assign any of the rights granted under this Amended
and Restated Name Licensing Agreement without the prior express
written consent of Licensor;
(h) Licensee shall not grant to any Person a right and license to use the
Licensed Marks without the prior express written consent of Licensor;
(i) Licensee shall not use any Licensor's Mark not covered by this Amended
and Restated Name Licensing Agreement which is the property or is
claimed as the property of Licensor or Licensor's subsidiaries or
affiliates, except with the prior express written consent of Licensor;
(j) Licensee shall comply with all applicable law, rules and regulations
pertaining to its business;
(k) Licensor has the sole and exclusive right to control the appearance of
the Licensed Marks, including the quality of the mark in the Licensed
Marks;
(l) the nature and quality of the business conducted by Licensee under the
Licensed Marks, and all related advertising, promotional and other
uses of Licensed Marks by Licensee shall conform to standards set by
and under the control of Licensor and communicated to Licensee from
time to time;
(m) except as otherwise agreed in writing by Licensor from time to time,
Licensee shall submit to Casey Mangan, or successor in the Corporate
Law Division of Licensor for Licensor's prior approval representative
samples of all proposed materials bearing the Licensed Marks, to the
extent that such materials are not contained in the Registration
Statement on Form S-3 (File No. 333-112249), as amended and the
exhibits thereto, the Registration Statement on Form S-3 (File No.
4
333-125937), as amended and the exhibits thereto or the Registration
Statement on Form S-3 (File No. 333-129157), as amended and the
exhibits thereto;
(n) Licensor shall have the right to inspect, upon reasonable notice, the
business facilities of Licensee and to request submission of written
materials at any time during the term of this Amended and Restated
Name Licensing Agreement so that Licensor may satisfy itself that
quality standards are being appropriately complied with and will
immediately modify or discontinue any use of Licensed Marks that
Licensor deems not to be in compliance with its quality standards;
(o) the standards of conduct of Licensee's business shall be equivalent to
the high standards of quality and ethics characteristic of the
businesses conducted by Licensor;
(p) the value and goodwill of the Licensed Marks accrues solely to
Licensor; and
(q) Licensee will not act or use Licensed Marks in any manner which may,
in Licensor's judgment, be in bad taste, be inconsistent with
Licensor's public image or which may in any way disparage Licensor or
its reputation including, but not limited to, types and placement of
advertising, or take any action which will harm or jeopardize the
Licensed Marks or Licensor's ownership thereof.
ARTICLE 4
INFRINGEMENT PROCEEDINGS
SECTION 4.1 Notification of Unauthorized Use. Licensee agrees to promptly
notify Licensor of any unauthorized use of any of Licensed Marks as such
unauthorized use comes to Licensee's attention. Licensor shall have the sole
right and discretion to take any action relating to Licensed Marks; provided,
that Licensee agrees to cooperate fully, should Licensor decide to take any such
action.
SECTION 4.2 Payments for Damages. If infringement proceedings result in an
award of damages or the payment of any sums to Licensor, any such damages or
payments shall belong solely to Licensor.
ARTICLE 5
TERM AND TERMINATION
SECTION 5.1 Term. This Amended and Restated Name Licensing Agreement shall
continue in force and effect for so long as Licensee continues to exist in
accordance with the terms of the Amended and Restated Trust Agreement, unless it
5
is sooner terminated as provided for in this Amended and Restated Name Licensing
Agreement.
SECTION 5.2 Automatic Termination. This Amended and Restated Name Licensing
Agreement shall automatically terminate upon the happening of any of the
following events:
(a) Licensee is ordered or adjudged bankrupt, is placed under the
supervision of a receiver, or enters into any scheme or composition
with creditors to make an assignment for the benefit of creditors;
(b) any assets of Licensee are seized or attached in conjunction with any
action against Licensee by a third party; or
(c) any of the assets of Licensee are seized or appropriated by any
governmental authority, whether or not compensation for such action is
offered to Licensee.
SECTION 5.3 Immediate Termination. Licensor shall have the right, but not
the obligation, to immediately terminate this Amended and Restated Name
Licensing Agreement and all rights granted under this Amended and Restated Name
Licensing Agreement in the event that Licensee (a) ceases to conduct business as
a statutory trust, (b) breaches any of its representations, agreements,
covenants and undertakings in this Amended and Restated Name Licensing
Agreement, (c) fails to comply with laws, rules and regulations applicable to it
or the conduct of its business to the complete satisfaction of Licensor, (d)
acts in a manner that impugns Licensor's reputation or (e) uses the Licensed
Marks in a manner that is inconsistent with or beyond the scope of the license
granted herein.
SECTION 5.4 Termination on Notice. Licensor may terminate this Amended and
Restated Name Licensing Agreement without cause upon the provision of ten days'
prior written notice to Licensee.
ARTICLE 6
EFFECT OF TERMINATION
SECTION 6.1 Discontinuation of Use of Licensed Marks. Upon termination of
this Amended and Restated Name Licensing Agreement, Licensee agrees to
immediately change Licensee's name as to not include any Licensed Marks, and to
discontinue and not to use in the future any of the Licensed Marks, any trade
name incorporating any of the Licensed Marks, or any terms confusingly similar
to any of Licensed Marks.
SECTION 6.2 Licensee Cooperation. Upon termination of this Amended and
Restated Name Licensing Agreement, Licensee agrees to cooperate fully with
6
Licensor to amend or cancel any governmental recordations or approvals
pertaining to any trade names, trademarks or service marks which consist of or
include any of Licensed Marks.
SECTION 6.3 Rights in Licensed Marks. Upon termination of this Amended and
Restated Name Licensing Agreement, any and all rights in the Licensed Marks
heretofor granted to Licensee and the goodwill connected therewith shall remain
the property of Licensor.
ARTICLE 7
MISCELLANEOUS
SECTION 7.1 Enforcement. The parties agree that any breaches of this
Amended and Restated Name Licensing Agreement shall cause irreparable injury to
the nonbreaching party and that an injunction shall be an appropriate remedy.
SECTION 7.2 Severability. In the event any provision of, or obligation
under, this Amended and Restated Name Licensing Agreement shall be invalid,
illegal or unenforceable, in any jurisdiction, the validity, legality and
enforceability of the remaining provisions or obligations, or of such provision
or obligation in any other jurisdiction, shall not in any way be affected or
impaired thereby to the fullest extent permitted under applicable law.
SECTION 7.3 Entire Agreement. This Amended and Restated Name Licensing
Agreement constitutes the entire agreement between the parties hereto relating
to the subject matter of this Amended and Restated Name Licensing Agreement, and
supersedes all previous agreements between the parties, whether written or oral.
SECTION 7.4 Amendments. Any amendments, supplements, modifications,
restatements or replacements of this Amended and Restated Name Licensing
Agreement, or waivers or consents to this Amended and Restated Name Licensing
Agreement, shall be in writing signed by the parties.
SECTION 7.5 Governing Law. This Amended and Restated Name Licensing
Agreement shall be governed by, and construed in accordance with, the laws of
the State of Illinois, without regard to its choice of law principles.
SECTION 7.6 Consent to Jurisdiction. Each party to this Amended and
Restated Name Licensing Agreement submits to the nonexclusive jurisdiction of
the United States Federal court located in Cook County, Illinois, for purposes
of any legal proceeding arising out of or relating to this Amended and Restated
Name Licensing Agreement or the transactions contemplated by this Amended and
Restated Name Licensing Agreement. Each party to this Amended and Restated Name
Licensing Agreement irrevocably waives, to the fullest extent permitted by law,
7
any objection which it may now or hereafter have to the laying of the venue of
any such proceeding brought in such a court and any claim that any such
proceeding brought in such a court has been brought in an inconvenient forum.
Each party to this Amended and Restated Name Licensing Agreement consents to
process being served in any suit, action or proceeding with respect to this
Amended and Restated Name Licensing Agreement, or any document delivered
pursuant to this Amended and Restated Name Licensing Agreement by the mailing of
a copy thereof by registered or certified mail, postage prepaid, return receipt
requested, to its respective address specified at the time for notices under
this Amended and Restated Name Licensing Agreement or to any other address of
which it shall have given written notice to the other party. The foregoing shall
not limit the ability of any party to this Amended and Restated Name Licensing
Agreement to bring suit in the courts of any other jurisdiction.
SECTION 7.7 Waiver of Jury Trial. Each of the parties to this Amended and
Restated Name Licensing Agreement irrevocably waives any and all right to a
trial by jury with respect to any legal proceeding arising out of or relating to
this Amended and Restated Name Licensing Agreement or any claims or transactions
in connection with this Amended and Restated Name Licensing Agreement. Each of
the parties to this Amended and Restated Name Licensing Agreement hereby
acknowledges that such waiver is made with full understanding and knowledge of
the nature of the rights and benefits waived hereby.
SECTION 7.8 No Waiver. No failure on the part of Licensor to exercise, and
no delay in exercising, and no course of dealing with respect to, any right,
power or privilege under this Amended and Restated Name Licensing Agreement
shall operate as a waiver thereof, nor shall any single or partial exercise
thereof or the exercise of any other right, power or privilege operate as such a
waiver.
SECTION 7.9 Remedies Cumulative. No right, power or remedy of Licensor
under this Amended and Restated Name Licensing Agreement shall be exclusive of
any other right, power or remedy, but shall be cumulative and in addition to any
other right, power or remedy thereunder or existing by law or in equity.
SECTION 7.10 Notices. All notices, demands, or other communications
required or permitted to be given under this Amended and Restated Name Licensing
Agreement shall be given in writing by delivering the same against receipt
thereof by facsimile transmission (confirmed by registered or certified mail,
postage prepaid, return receipt requested), or by registered or certified mail,
postage prepaid, return receipt requested, addressed as follows (and if so
given, shall be deemed given when mailed or upon receipt of a confirmation, if
sent by facsimile):
8
If to Licensor: Allstate Insurance Company
3100 Sanders Road
Northbrook, Illinois 60062
Attention: Michael J. Velotta, Vice President, Deputy
General Counsel and Assistant Secretary
Facsimile: (847) 326-6742
If to Licensee: Allstate Life Global Funding
c/o AMACAR Pacific Corp.
6525 Morrison Boulevard, Suite 318
Charlotte, North Carolina 28211
Attention: President
Facsimile: (704) 365-1362
or at such other address as shall be designated by any party in a written notice
to the other party.
SECTION 7.11 Counterparts. This Amended and Restated Name Licensing
Agreement and any amendments, supplements, modifications, restatements or
replacements of this Amended and Restated Name Licensing Agreement, or waivers
or consents to this Amended and Restated Name Licensing Agreement, may be
executed in any number of counterparts, and by different parties to this Amended
and Restated Name Licensing Agreement in separate counterparts, each of which,
when so executed and delivered, shall be deemed to be an original and all of
which counterparts, when taken together shall constitute one and the same
instrument. This Amended and Restated Name Licensing Agreement shall become
effective upon the execution of a counterpart by each of the parties.
SECTION 7.12 Limitation of Delaware Trustee Liability. Notwithstanding any
provision of this Amended and Restated Name Licensing Agreement to the contrary,
it is expressly understood and agreed by the parties that (a) this Amended and
Restated Name Licensing Agreement is executed and delivered by Wilmington Trust
Company (The "Delaware Trustee") not individually or personally, but solely as
trustee, as applicable, in the exercise of the powers and authority conferred
and vested in it, pursuant to the Amended and Restated Trust Agreement of the
Licensee, (b) each of the representations, undertakings and agreements in this
Amended and Restated Name Licensing Agreement made on the part of the Licensee
is made and intended not as personal representations, undertakings and
agreements by the Delaware Trustee but is made and intended for the purpose of
binding only the Licensee, (c) nothing contained in this Amended and Restated
Name Licensing Agreement shall be construed as creating any liability on the
Delaware Trustee, individually or personally, to perform any covenant either
expressed or implied contained in this Amended and Restated Name Licensing
Agreement, all such liability, if any, being expressly waived by the parties to
this Amended and Restated Name Licensing Agreement and by any person claiming
by, through or under the parties to this Amended and Restated Name Licensing
9
Agreement, and (d) under no circumstances shall the Delaware Trustee be
personally liable for the payment of any indebtedness or expenses of the
Licensee or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Licensee under
this Amended and Restated Name Licensing Agreement of any other related
documents.
10
IN WITNESS WHEREOF, the parties have caused this Amended and Restated Name
Licensing Agreement to be executed by duly authorized representatives on the
date first written above.
ALLSTATE INSURANCE COMPANY
By:
----------------------------------------------
Name:
Title:
ALLSTATE LIFE GLOBAL FUNDING
By: WILMINGTON TRUST COMPANY, not in its
individual capacity, but solely as Delaware
Trustee
By:
----------------------------------------------
Name:
Title:
11
APPENDIX A
LICENSED MARKS
o Allstate
o Allstate Life
o [ALLSTATE(R) LOGO]
A-1
EXHIBIT 10.12
===============================================================================
STANDARD NAME LICENSING AGREEMENT TERMS
with respect to
ALLSTATE LIFE GLOBAL FUNDING TRUSTS
===============================================================================
TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS
SECTION 1.1 Definitions......................................................................1
SECTION 1.2 Other Definitional Provisions....................................................3
ARTICLE 2
GRANT OF LICENSE; INDEPENDENT CONTRACTORS
SECTION 2.1 Grant of License.................................................................4
SECTION 2.2 Independent Contractors..........................................................4
ARTICLE 3
AGREEMENTS AND ACKNOWLEDGEMENTS OF LICENSEE
SECTION 3.1 Agreements and Acknowledgements of Licensee......................................4
ARTICLE 4
INFRINGEMENT PROCEEDINGS
SECTION 4.1 Notification of Unauthorized Use.................................................6
SECTION 4.2 Payments for Damages.............................................................6
ARTICLE 5
TERM AND TERMINATION
SECTION 5.1 Term.............................................................................6
SECTION 5.2 Automatic Termination............................................................6
SECTION 5.3 Immediate Termination............................................................7
SECTION 5.4 Termination on Notice............................................................7
ARTICLE 6
EFFECT OF TERMINATION
SECTION 6.1 Change of Licensee Marks.........................................................7
SECTION 6.2 Licensee Cooperation.............................................................7
SECTION 6.3 Rights in Licensed Marks.........................................................7
ARTICLE 7
MISCELLANEOUS
SECTION 7.1 Enforcement......................................................................7
i
SECTION 7.2 Severability.....................................................................7
SECTION 7.3 Entire Agreement.................................................................8
SECTION 7.4 Amendment of Name Licensing Agreement............................................8
SECTION 7.5 Governing Law....................................................................8
SECTION 7.6 Consent to Jurisdiction..........................................................8
SECTION 7.7 Waiver of Jury Trial.............................................................8
SECTION 7.8 No Waiver........................................................................8
SECTION 7.9 Remedies Cumulative..............................................................9
SECTION 7.10 Notices..........................................................................9
SECTION 7.11 Counterparts.....................................................................9
APPENDIX A LICENSED MARKS.................................................................A-1
ii
This document constitutes the STANDARD NAME LICENSING AGREEMENT TERMS which
will be incorporated by reference in the Name Licensing Agreement (as defined
below) between Allstate Insurance Company (the "Licensor") and the Trust (as
defined below) (the "Licensee").
These Standard Name Licensing Agreement Terms shall be of no force and
effect unless and until incorporated by reference in, and then only to the
extent not modified by, the Name Licensing Agreement.
The following terms and provisions shall govern the use of the Licensor's
Licensed Marks (as defined below) by the Licensee, subject to contrary terms and
provisions expressly adopted in the Name Licensing Agreement, which contrary
terms shall be controlling.
ARTICLE 1
DEFINITIONS
SECTION 1.1.......Definitions. The following terms, as used herein, have
the following meanings:
"Administrative Services Agreement" means that certain Administrative
Services Agreement included in Part B of the Series Instrument, by and between
the Trust and the Administrator, as the same may be amended, supplemented,
modified, restated or replaced from time to time.
"Administrator" means AMACAR Pacific Corp., a Delaware corporation, in its
capacity as the sole administrator of the Trust, or another entity specified in
the Indenture as the Administrator, and, in each case, its permitted successors
and assigns.
"Agents" has the meaning ascribed in the Distribution Agreement.
"Coordination Agreement" means that certain Coordination Agreement included
in Part F of the Series Instrument, among the Trust and the other parties
specified therein, as the same may be amended, supplemented, modified, restated
or replaced from time to time.
"Delaware Trustee" means Wilmington Trust Company, a Delaware banking
corporation, or another entity specified in the Indenture as the Delaware
Trustee, in each case not in its individual capacity but solely as trustee, and
its successors.
"Distribution Agreement" means that certain Distribution Agreement dated as
of -, 2006, by and among Allstate Life Global Funding and the Agents named
therein, as the same may be amended, restated, modified or supplemented from
time to time.
"Funding Note Indenture" means that certain Funding Note Indenture included
in Part H of the Series Instrument, among Global Funding and the other parties
1
specified therein, as the same may be amended, supplemented, modified, restated
or replaced from time to time.
"Indenture" means that certain Indenture included in Part G of the Series
Instrument, among the Trust and the other parties specified therein, as the same
may be amended, supplemented, modified, restated or replaced from time to time.
"Licensed Marks" shall include all marks listed on Appendix A attached
hereto as the same may be amended, supplemented, modified, restated or replaced
from time to time.
"Licensed Services" means the activities necessary to accomplish all
purposes of the Trust as set forth in the Trust Agreement.
"Licensee" means the Trust.
"Licensor" means Allstate Insurance Company, an Illinois stock insurance
company, and its successors.
"Name Licensing Agreement" means that certain Name Licensing Agreement
included in Part D of the Series Instrument, between Licensor and Licensee, as
the same may be amended, supplemented, modified, restated or replaced from time
to time.
"Note" means each medium term note issued by the Trust under the Indenture,
each in an authorized denomination and represented, individually or
collectively, by a Note Certificate authenticated by the Indenture Trustee
pursuant to the terms of the Indenture.
"Note Certificate" means a security certificate representing one or more
Notes.
"Person" means any natural person, corporation, limited partnership,
general partnership, joint stock company, limited liability company, joint
venture, association, company, trust (including any beneficiary thereof), bank,
trust company, land trust, business trust or other organization, whether or not
a legal entity, and governments and agencies and political subdivisions thereof.
"Series Instrument" means the series instrument of the Trust, pursuant to
which the Administrative Services Agreement, the Coordination Agreement, the
Funding Note Indenture, the Indenture, the Name Licensing Agreement, the Support
Agreement, the Terms Agreement and the Trust Agreement are entered into, and
certain other documents are executed, in connection with the issuance of the
Notes by the Trust.
"Support Agreement" means that certain Support and Expenses Agreement
included in Part C of the Series Instrument, by and between Allstate Life
Insurance
2
Company and the Trust, as the same may be amended, supplemented, modified,
restated or replaced from time to time.
"Terms Agreement" means that certain Terms Agreement included in Part E of
the Series Instrument, by and among Allstate Life Global Funding, the Trust and
each Agent named therein, which will incorporate by reference the terms of the
Distribution Agreement.
"Territory" shall mean worldwide.
"Trust" means the Allstate Life Global Funding Trust specified in the
Series Instrument, together with its permitted successors and assigns.
"Trust Agreement" means that certain Trust Agreement included in Part A of
the Series Instrument, among the Trust Beneficial Owner, the Administrator and
the Delaware Trustee, as the same may be amended, supplemented, modified,
restated or replaced from time to time.
"Trust Beneficial Owner" means Allstate Life Global Funding, a Delaware
statutory trust, in its capacity as trust beneficial owner.
SECTION 1.2.......Other Definitional Provisions. For all purposes of the
Name Licensing Agreement except as otherwise expressly provided or unless the
context otherwise requires:
(a) the terms defined in this Article shall have the meanings
ascribed to them in this Article and shall include the plural as
well as the singular;
(b) the words "include", "includes" and "including" shall be
construed to be followed by the words "without limitation";
(c) Article and Section headings are for the convenience of the
reader and shall not be considered in interpreting the Name
Licensing Agreement or the intent of the parties to the Name
Licensing Agreement;
(d) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to the Name Licensing Agreement as a whole
and not to any particular Article, Section, Appendix or other
subdivision; and
(e) references herein to Articles, Sections and Appendices shall,
unless otherwise specified, refer respectively to Articles,
Sections and Appendices
3
ARTICLE 2
GRANT OF LICENSE; INDEPENDENT CONTRACTORS
SECTION 2.1.......Grant of License. Licensor hereby grants to Licensee for
the term of the Name Licensing Agreement a nonexclusive, nontransferable right
and license to use the Licensed Marks for the Licensed Services within the
Territory. Licensor is not representing that it has rights with respect to
Licensed Marks or the Licensed Marks in every jurisdiction within the Territory.
SECTION 2.2.......Independent Contractors. Licensor and Licensee are
independent contractors and are not, and shall not, represent themselves as
principal and agent, partners or joint venturers.
ARTICLE 3
AGREEMENTS AND ACKNOWLEDGEMENTS OF LICENSEE
SECTION 3.1.......Agreements and Acknowledgements of Licensee. Licensee
acknowledges and agrees that:
(a) Licensor is the sole owner of the Licensed Marks;
(b) Licensee shall do nothing inconsistent with the ownership of the
Licensed Marks by Licensor;
(c) all use of the Licensed Marks by Licensee shall inure only to the
benefit of and be on behalf of Licensor;
(d) Licensee shall assist Licensor in executing any additional
documents that may be necessary or desirable to effect the
protection of Licensor's interests in Licensed Marks, including,
but not limited to, the execution of any and all documents
required by governmental agencies in order to register or
maintain trademark and service mark registrations; in addition,
Licensee shall not oppose Licensor's registration of the Licensed
Marks nor take action that jeopardizes Licensor's rights in
Licensed Marks;
(e) nothing in the Name Licensing Agreement shall give Licensee any
right, title or interest in Licensed Marks other than the license
granted in the Name Licensing Agreement;
(f) Licensee shall not attack or challenge in any way Licensor's
rights in and to Licensed Marks or the validity or enforceability
of the Name Licensing Agreement;
4
(g) Licensee shall not assign any of the rights granted under the
Name Licensing Agreement without the prior express written
consent of Licensor;
(h) Licensee shall not grant to any Person a right and license to use
the Licensed Marks without the prior express written consent of
Licensor;
(i) Licensee shall not use any Licensor's Mark not covered by the
Name Licensing Agreement which is the property or is claimed as
the property of Licensor or Licensor's subsidiaries or
affiliates, except with the prior express written consent of
Licensor;
(j) Licensee shall comply with all applicable law, rules and
regulations pertaining to its business;
(k) Licensor has the sole and exclusive right to control the
appearance of the Licensed Marks, including the quality of the
mark in the Licensed Marks;
(l) the nature and quality of the business conducted by Licensee
under the Licensed Marks, and all related advertising,
promotional and other uses of Licensed Marks by Licensee shall
conform to standards set by and under the control of Licensor and
communicated to Licensee from time to time;
(m) except as otherwise agreed in writing by Licensor from time to
time, Licensee shall submit to Casey Mangan, or successor in the
Corporate Law Division of Licensor for Licensor's prior approval
representative samples of all proposed materials bearing the
Licensed Marks, to the extent that such materials are not
contained in the Registration Statement on Form S-3 (File No.
333-129157), as amended and exhibits thereto;
(n) Licensor shall have the right to inspect, upon reasonable notice,
the business facilities of Licensee and to request submission of
written materials at any time during the term of the Name
Licensing Agreement so that Licensor may satisfy itself that
quality standards are being appropriately complied with and will
immediately modify or discontinue any use of Licensed Marks that
Licensor deems not to be in compliance with its quality
standards;
5
(o) the standards of conduct of Licensee's business shall be
equivalent to the high standards of quality and ethics
characteristic of the businesses conducted by Licensor;
(p) the value and goodwill of the Licensed Marks accrues solely to
Licensor; and
(q) Licensee will not act or use Licensed Marks in any manner which
may, in Licensor's judgment, be in bad taste, be inconsistent
with Licensor's public image or which may in any way disparage
Licensor or its reputation including, but not limited to, types
and placement of advertising, or take any action which will harm
or jeopardize the Licensed Marks or Licensor's ownership thereof.
ARTICLE 4
INFRINGEMENT PROCEEDINGS
SECTION 4.1.......Notification of Unauthorized Use. Licensee agrees to
promptly notify Licensor of any unauthorized use of any of Licensed Marks as
such unauthorized use comes to Licensee's attention. Licensor shall have the
sole right and discretion to take any action relating to Licensed Marks;
provided, that Licensee agrees to cooperate fully, should Licensor decide to
take any such action.
SECTION 4.2.......Payments for Damages. If infringement proceedings result
in an award of damages or the payment of any sums to Licensor, any such damages
or payments shall belong solely to Licensor.
ARTICLE 5
TERM AND TERMINATION
SECTION 5.1.......Term. The Name Licensing Agreement shall continue in
force and effect for so long as Licensee continues to exist in accordance with
the terms of the Trust Agreement, unless it is sooner terminated as provided for
in the Name Licensing Agreement.
SECTION 5.2.......Automatic Termination. The Name Licensing Agreement shall
automatically terminate upon the happening of any of the following events:
(a) Licensee is ordered or adjudged bankrupt, is placed under the
supervision of a receiver, or enters into any scheme or
composition with creditors to make an assignment for the benefit
of creditors;
(b) any assets of Licensee are seized or attached in conjunction with
any action against Licensee by a third party; or
6
(c) any of the assets of Licensee are seized or appropriated by any
governmental authority, whether or not compensation for such
action is offered to Licensee.
SECTION 5.3.......Immediate Termination. Licensor shall have the right, but
not the obligation, to immediately terminate the Name Licensing Agreement and
all rights granted under the Name Licensing Agreement in the event that Licensee
(a) ceases to conduct business as a statutory trust, (b) breaches any of its
representations, agreements, covenants and undertakings in the Name Licensing
Agreement, (c) fails to comply with laws, rules and regulations applicable to it
or the conduct of its business to the complete satisfaction of Licensor, (d)
acts in a manner that impugns Licensor's reputation or (e) uses the Licensed
Marks in a manner that is inconsistent with or beyond the scope of the license
granted herein.
SECTION 5.4.......Termination on Notice. Licensor may terminate the Name
Licensing Agreement without cause upon the provision of ten days' prior written
notice to Licensee.
ARTICLE 6
EFFECT OF TERMINATION
SECTION 6.1.......Change of Licensee Marks. Upon termination of the Name
Licensing Agreement, Licensee agrees to immediately change Licensee's name as to
not include any Licensed Marks, and to discontinue and not to use in the future
any of the Licensed Marks, any trade name incorporating any of the Licensed
Marks, or any terms confusingly similar to any of Licensed Marks.
SECTION 6.2.......Licensee Cooperation. Upon termination of the Name
Licensing Agreement, Licensee agrees to cooperate fully with Licensor to amend
or cancel any governmental recordations or approvals pertaining to any
tradenames, trademarks or servicemarks which consist of or include any of
Licensed Marks.
SECTION 6.3.......Rights in Licensed Marks. Upon termination of the Name
Licensing Agreement, any and all rights in the Licensed Marks heretofor granted
to Licensee and the goodwill connected therewith shall remain the property of
Licensor.
ARTICLE 7
MISCELLANEOUS
SECTION 7.1.......Enforcement. The parties agree that any breaches of the
Name Licensing Agreement shall cause irreparable injury to the nonbreaching
party and that an injunction shall be an appropriate remedy.
SECTION 7.2.......Severability. In the event any provision of, or
obligation under, the Name Licensing Agreement shall be invalid, illegal or
unenforceable, in any jurisdiction, the validity, legality and enforceability of
the remaining provisions or
7
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby to the fullest extent permitted
under applicable law.
SECTION 7.3.......Entire Agreement. The Name Licensing Agreement
constitutes the entire agreement between the parties hereto relating to the
subject matter of the Name Licensing Agreement, and supersedes all previous
agreements between the parties, whether written or oral.
SECTION 7.4.......Amendment of Name Licensing Agreement. Any amendments,
supplements, modifications, restatements or replacements of the Name Licensing
Agreement, or waivers or consents to the Name Licensing Agreement, shall be in
writing signed by the parties.
SECTION 7.5.......Governing Law. The Name Licensing Agreement shall be
governed by, and construed in accordance with, the laws of the State of
Illinois, without regard to its choice of law principles.
SECTION 7.6.......Consent to Jurisdiction. Each party to the Name Licensing
Agreement submits to the nonexclusive jurisdiction of the United States Federal
court located in Cook County, Illinois, for purposes of any legal proceeding
arising out of or relating to the Name Licensing Agreement or the transactions
contemplated by the Name Licensing Agreement. Each party to the Name Licensing
Agreement irrevocably waives, to the fullest extent permitted by law, any
objection which it may now or hereafter have to the laying of the venue of any
such proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum. Each party to
the Name Licensing Agreement consents to process being served in any suit,
action or proceeding with respect to the Name Licensing Agreement, or any
document delivered pursuant to the Name Licensing Agreement by the mailing of a
copy thereof by registered or certified mail, postage prepaid, return receipt
requested, to its respective address specified at the time for notices under the
Name Licensing Agreement or to any other address of which it shall have given
written notice to the other party. The foregoing shall not limit the ability of
any party to the Name Licensing Agreement to bring suit in the courts of any
other jurisdiction.
SECTION 7.7.......Waiver of Jury Trial. Each of the parties to the Name
Licensing Agreement irrevocably waives any and all right to a trial by jury with
respect to any legal proceeding arising out of or relating to the Name Licensing
Agreement or any claims or transactions in connection with the Name Licensing
Agreement. Each of the parties to the Name Licensing Agreement hereby
acknowledges that such waiver is made with full understanding and knowledge of
the nature of the rights and benefits waived hereby.
SECTION 7.8.......No Waiver. No failure on the part of Licensor to
exercise, and no delay in exercising, and no course of dealing with respect to,
any right, power or privilege under the Name Licensing Agreement shall operate
as a waiver thereof, nor
8
shall any single or partial exercise thereof or the exercise of any other right,
power or privilege operate as such a waiver.
SECTION 7.9.......Remedies Cumulative. No right, power or remedy of
Licensor under the Name Licensing Agreement shall be exclusive of any other
right, power or remedy, but shall be cumulative and in addition to any other
right, power or remedy thereunder or existing by law or in equity.
SECTION 7.10......Notices. All notices, demands, or other communications
required or permitted to be given under the Name Licensing Agreement shall be
given in writing by delivering the same against receipt thereof by facsimile
transmission (confirmed by registered or certified mail, postage prepaid, return
receipt requested), or by registered or certified mail, postage prepaid, return
receipt requested, addressed as follows (and if so given, shall be deemed given
when mailed or upon receipt of a confirmation, if sent by facsimile):
If to Licensor:
Allstate Insurance Company
3100 Sanders Road
Northbrook, Illinois 60062
Attention: Michael J. Velotta, Vice President, Deputy
General Counsel and Assistant Secretary
Facsimile: (847) 326-6742
If to Licensee:
Allstate Life Global Funding
c/o AMACAR Pacific Corp.
6525 Morrison Boulevard, Suite 318
Charlotte, North Carolina 28211
Attention: President
Facsimile: (704) 365-1362
or at such other address as shall be designated by any party in a written notice
to the other party.
SECTION 7.11......Counterparts. The Name Licensing Agreement and any
amendments, supplements, modifications, restatements or replacements of the Name
Licensing Agreement, or waivers or consents to the Name Licensing Agreement, may
be executed in any number of counterparts, and by different parties to the Name
Licensing Agreement in separate counterparts, each of which, when so executed
and delivered, shall be deemed to be an original and all of which counterparts,
when taken together shall constitute one and the same instrument. The Name
Licensing Agreement shall become effective upon the execution of a counterpart
by each of the parties.
9
APPENDIX A
LICENSED MARKS
Allstate
Allstate Life
[ALLSTATE(R) LOGO]
A-1
Exhibit 12
ALLSTATE LIFE INSURANCE COMPANY AND SUBSIDIARIES
COMPUTATION OF EARNINGS TO FIXED CHARGES RATIO
For the nine-month
periods ended For the year ended
September 30, December 31,
--------------------- --------------------------------------------------------
(in millions) 2005 2004 2004 2003 2002 2001 2000
--------- --------- --------- --------- --------- --------- ---------
1. Income from operations before income
taxes and cumulative effect of changes
in acounting principle, after-tax $ 434 $ 342 $ 545 $ 453 $ 302 $ 553 $ 711
--------- --------- --------- --------- --------- --------- ---------
Fixed Charges:
2. Interest on indebtedness $ 1 $ - $ - $ - $ - $ - $ -
3. Interest factor of annual rental expense - - - - 2 4 4
--------- --------- --------- --------- --------- --------- ---------
4. Total fixed charges (2+3) $ 1 $ - $ - $ - $ 2 $ 4 $ 4
--------- --------- --------- --------- --------- --------- ---------
5. Income from operations before income
taxes and fixed charges (1+4) $ 435 $ 342 $ 545 $ 453 $ 304 $ 557 $ 715
========= ========= ========= ========= ========= ========= =========
6. Ratio of earnings to fixed charges
before dividends on redeemable preferred
securities and interest credited to
contracholder funds (5/4) 435.0X - - - 152.0X 139.3X 178.8X
========= ========= ========= ========= ========= ========= =========
7. Dividends on redeemable preferred
securities 2 2 2 2 3 20 20
8. Total fixed charges and dividends on
redeemable preferred securities(4+7) $ 3 $ 2 $ 2 $ 2 $ 5 $ 24 $ 24
--------- --------- --------- --------- --------- --------- ---------
9. Income from continuing operations before
income taxes, fixed charges and redeemable
preferred securities (1+4+7) $ 437 $ 344 $ 547 $ 455 $ 307 $ 577 $ 735
========= ========= ========= ========= ========= ========= =========
10. Ratio of earnings to fixed charges,
excluding interest credited to contractholder
funds (A) (9/8) 145.7X 172.0X 273.5X 227.5X 61.4X 24.0X 30.6X
========= ========= ========= ========= ========= ========= =========
11. Interest credited to contractholder funds $ 1,736 $ 1,397 $ 1,923 $ 1,764 $ 1,691 $ 1,670 $ 1,519
12. Total fixed charges including dividends on
redeemable preferred securities and interest
credited to contractholder funds (8+11) $ 1,739 $ 1,399 $ 1,925 $ 1,766 $ 1,696 $ 1,694 $ 1,543
--------- --------- --------- --------- --------- --------- ---------
13. Income from continuing operations before
income taxes and fixed charges including
interest credited to contractholder
funds (1+12) $ 2,173 $ 1,741 $ 2,470 $ 2,219 $ 1,998 $ 2,2472 $ 2,254
========= ========= ========= ========= ========= ========= =========
14. Ratio of earnings to fixed charges (13/12) 1.2X 1.2X 1.3X 1.3X 1.2X 1.3X 1.5X
========= ========= ========= ========= ========= ========= =========
(A) In this presentation, interest credited to contractholder funds is excluded
to promote transparency and allows users of this exhibit to quantify the impact
of interest credited to contractholder funds on the ratio of earnings to fixed
charges.
[LETTERHEAD OF LEBOEUF, LAMB, GREEN & MACRAE LLP]
February 27, 2006
Securities and Exchange Commission
100 F Street, N.E.
Washington, DC 20549
Re: Allstate Life Global Funding
Allstate Life Insurance Company
Amendment No. 2 to Registration Statement on Form S-3
(File No. 333-129157), Filed on October 20, 2005
Ladies and Gentlemen:
On behalf of Allstate Life Global Funding, a statutory trust organized
under the laws of the State of Delaware, and Allstate Life Insurance Company, an
Illinois life insurance company ("Allstate Life"), transmitted herewith for
filing with the Securities and Exchange Commission (the "Commission") is
Amendment No. 2 to the Registration Statement on Form S-3 (File No. 333-129157)
in connection with the registration under the Securities Act of 1933, as amended
(the "Securities Act"), of $5,000,000,000 of: (i) Secured Medium Term Notes (the
"Notes"), (ii) Funding Notes and (iii) Funding Agreements, under two programs
for the issuance of Notes secured by Funding Agreements issued by Allstate Life
(the "Programs"). The Programs have been effective since April 27, 2004
(Registration Statement on Form S-3 (File No. 333-112249) and Registration
Statement on Form S-3 (File No. 333-125937)).
Pursuant to Rule 429 under the Securities Act, $1,650,000,000 of: (i)
Notes, (ii) Funding Notes and (iii) Funding Agreements registered under
Registration Statement No. 333-125937 and not previously sold has been
consolidated into this Registration Statement.
Of the total registration fee of $577,265, $194,205 was paid in connection
with Registration Statement No. 333-125937. Registration fees in the amount of
$270,710 were paid on October 20, 2005 in connection with the initial filing of
the Registration Statement, and an additional filing fee in the amount of
$112,350 has been wire transferred to the Commission's account with Mellon Bank.
Please contact me at (212) 424-8710 with any questions.
Very truly yours,
/s/ Vladimir Nicenko
--------------------
Vladimir Nicenko