AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 30, 2003
REGISTRATION NO. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
AMERICAN FINANCIAL GROUP, INC. OHIO 31-1544320
AMERICAN FINANCIAL CAPITAL TRUST II DELAWARE 31-6549738
AMERICAN FINANCIAL CAPITAL TRUST III DELAWARE 16-6543606
AMERICAN FINANCIAL CAPITAL TRUST IV DELAWARE 16-6543609
(Exact Name of Registrant as (State or Other Jurisdiction (I.R.S. Employer Identification
Specified in Its Charter) of Incorporation Number)
or Organization)
ONE EAST FOURTH STREET
CINCINNATI, OHIO 45202
(513) 579-2121
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of Registrants' Principal Executive Offices)
----------------------------
JAMES C. KENNEDY, ESQ.
VICE PRESIDENT, DEPUTY GENERAL COUNSEL AND SECRETARY
AMERICAN FINANCIAL GROUP, INC.
ONE EAST FOURTH STREET
CINCINNATI, OHIO 45202
(513) 579-2538
FACSIMILE (513) 579-0108
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent For Service)
WITH COPIES TO:
MARK A. WEISS, ESQ.
KEATING, MUETHING & KLEKAMP, P.L.L.
1400 PROVIDENT TOWER
ONE EAST FOURTH STREET
CINCINNATI, OHIO 45202
(513) 579-6599
FACSIMILE (513) 579-6956
(Cover continued on next page)
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to
time after the effective date of this Registration Statement as determined by
market conditions and other factors.
If the only securities being registered on this form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [ ]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, please 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. [ ]
CALCULATION OF REGISTRATION FEE
Proposed Maximum Proposed Maximum
Aggregate Offering Aggregate Amount of
Title of Each Class of Securities Amount to be Price Per Share Offering Price Registration Fee
to be Registered Registered (1) (2)(3) (2)(3) (4)
-------------------------------------------------------------------------------------------------------------------------
Debt Securities, Common Stock,
Preferred Stock, Warrants, Depositary
Shares, Stock Purchase Contracts and
Stock Purchase Units of American
Financial Group, Inc.
Preferred Securities of
American Financial Capital
Trust II
Preferred Securities of
American Financial Capital
Trust III
Preferred Securities of
American Financial Capital
Trust IV
Guarantee of Preferred
Securities of American
Financial Capital Trust II, American
Financial Capital Trust III and
American Financial Capital Trust IV
by American Financial Group, Inc.(5)
-------------------------------------------------------------------------------------------------------------------------
Total $600,000,000 100% $600,000,000 $21,358
-------------------------------------------------------------------------------------------------------------------------
(1) Such indeterminate number or principal amount of Debt Securities,
Common Stock, Preferred Stock, Warrants, Depositary Shares, Stock
Purchase Contracts and Stock Purchase Units of American Financial
Group, Inc., and Preferred Securities of American Financial Capital
Trust II, American Financial Capital Trust III and American Financial
Capital Trust IV as may from time to time be issued at indeterminate
prices. Debt Securities of American Financial Group, Inc. may be issued
and sold to American Financial Capital Trust II, American Financial
Capital Trust III and American Financial Capital Trust IV, in which
event such Debt Securities may later be distributed to the holders of
Preferred Securities of American Financial Capital Trust II, American
Financial Capital Trust III and American Financial Capital Trust IV
upon dissolution and the distribution of the assets thereof. The amount
registered is in United States dollars or the equivalent thereof in any
other currency, currency unit or units, or composite currency or
currencies.
(Cover continued on next page)
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457. The aggregate offering price of the Debt
Securities, Common Stock, Preferred Stock, Warrants, Depositary Shares,
Stock Purchase Contracts, Stock Purchase Units and Preferred Securities
registered hereby will not exceed $600,000,000.
(3) Excluding accrued interest and distributions, if any.
(4) A filing fee of $125,100 was previously paid in connection with
$450,000,000 of Debt Securities and Common Stock of American Financial
Group, Inc., and Preferred Securities of American Financial Capital
Trust II registered under the Registration Statement on Form S-3 (No.
333-81903) of which $93,512 of the fee is attributable to the
$336,376,562.50 of securities being carried forward. In connection with
this Registration Statement, the Registrants are paying a fee based
solely on the additional Debt Securities, Common Stock, Preferred
Stock, Warrants, Depositary Shares, Stock Purchase Contracts, Stock
Purchase Units and Preferred Securities being registered and having an
aggregate initial public offering price of $263,623,437.50.
(5) Includes back-up undertakings, consisting of obligations of American
Financial Group, Inc. to provide certain indemnities in respect of, and
pay and be responsible for certain expenses and debts of American
Financial Capital Trust II, American Financial Capital Trust III and
American Financial Capital Trust IV. No separate consideration will be
received for the Guarantee or any back-up undertakings.
Pursuant to Rule 429 of the Securities Act of 1933, the Prospectus contained in
this Registration Statement also relates to $336,376,562.50 of unissued Debt
Securities and Common Stock of American Financial Group, Inc., and Preferred
Securities of American Financial Capital Trust II registered pursuant to the
Registrants' Registration Statement on Form S-3 (No. 333-81903). This
Registration Statement, which is a new registration statement, also constitutes
a post-effective amendment to Registration Statement No. 333-81903. Such post-
effective amendment shall become effective concurrently with the effectiveness
of this Registration Statement in accordance with Section 8(a) of the Securities
Act of 1933.
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
Subject to Completion, Dated June 30, 2003
PROSPECTUS
$600,000,000
[AMERICAN FINANCIAL GROUP, INC. LOGO]
AMERICAN FINANCIAL GROUP, INC.
DEBT SECURITIES, COMMON STOCK, PREFERRED STOCK, WARRANTS,
DEPOSITARY SHARES, STOCK PURCHASE CONTRACTS AND STOCK PURCHASE UNITS
AND
AMERICAN FINANCIAL CAPITAL TRUST II
AMERICAN FINANCIAL CAPITAL TRUST III
AMERICAN FINANCIAL CAPITAL TRUST IV
PREFERRED SECURITIES
FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED IN THIS PROSPECTUS, BY
AMERICAN FINANCIAL GROUP, INC.
American Financial Group, Inc., American Financial Capital Trust II,
American Financial Capital Trust III and American Financial Capital Trust IV may
offer up to $600,000,000 of the securities listed above from time to time. This
prospectus contains general information about these securities.
When American Financial Group, Inc., American Financial Capital Trust
II, American Financial Capital Trust III or American Financial Capital Trust IV
offer securities, we will provide a prospectus supplement containing the
specific terms of that offering. You should read carefully this prospectus and
any supplement before you invest.
This prospectus may not be used to consummate sales of securities
unless accompanied by a prospectus supplement.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this prospectus is ______, 2003
TABLE OF CONTENTS
ABOUT THIS PROSPECTUS........................................................................................... i
WHERE YOU CAN FIND MORE INFORMATION............................................................................. ii
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE................................................................. ii
SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS............................................................... iii
AMERICAN FINANCIAL GROUP, INC................................................................................... 1
THE AMERICAN FINANCIAL CAPITAL TRUSTS........................................................................... 1
USE OF PROCEEDS................................................................................................. 3
RATIO OF EARNINGS TO FIXED CHARGES.............................................................................. 3
DESCRIPTION OF THE SECURITIES WE MAY OFFER...................................................................... 3
DESCRIPTION OF DEBT SECURITIES.................................................................................. 6
DESCRIPTION OF COMMON STOCK..................................................................................... 12
DESCRIPTION OF PREFERRED STOCK.................................................................................. 13
DESCRIPTION OF WARRANTS......................................................................................... 15
DESCRIPTION OF DEPOSITARY SHARES................................................................................ 16
DESCRIPTION OF THE STOCK PURCHASE CONTRACTS AND THE STOCK PURCHASE UNITS........................................ 20
DESCRIPTION OF THE TRUST PREFERRED SECURITIES................................................................... 20
DESCRIPTION OF THE TRUST PREFERRED SECURITIES GUARANTEE......................................................... 24
RELATIONSHIP AMONG THE TRUST PREFERRED SECURITIES, THE TRUST PREFERRED SECURITIES GUARANTEE AND THE JUNIOR
SUBORDINATED DEBT SECURITIES HELD BY THE TRUST.................................................................. 27
PLAN OF DISTRIBUTION............................................................................................ 28
LEGAL MATTERS................................................................................................... 30
EXPERTS......................................................................................................... 30
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement filed with the
Securities and Exchange Commission using a "shelf" registration process. Under
this shelf process, American Financial Group, Inc., American Financial Capital
Trust II, American Financial Capital Trust III and American Financial Capital
Trust IV may sell the securities described in this prospectus in one or more
offerings up to a total dollar amount of $600,000,000. This prospectus provides
you with a general description of the securities which may be offered. Each time
securities are offered for sale, we will provide a prospectus supplement that
contains specific information about the terms of that offering. The prospectus
supplement may also add, update or change information contained in this
prospectus. You should read both this prospectus and any prospectus supplement
together with additional information described below under the following
heading.
The registration statement that contains this prospectus (including the
exhibits) contains additional important information about American Financial
Group, Inc., American Financial Capital Trust II, American Financial Capital
Trust III and American Financial Capital Trust IV and the securities offered
under this prospectus. Specifically, we have filed certain legal documents that
control the terms of the securities offered by this prospectus as exhibits to
the registration statement. We will file certain other legal documents that
control the terms of the securities offered by this prospectus as exhibits to
reports we file with the SEC. That registration statement and the other reports
can be read at the SEC web site or at the SEC offices mentioned below under the
following heading.
i
WHERE YOU CAN FIND MORE INFORMATION
American Financial Group is subject to the information and reporting
requirements of the Securities Exchange Act of 1934, under which we file annual,
quarterly and special reports, proxy statements and other information with the
Securities and Exchange Commission. You may read and copy this information at
the following location of the Securities and Exchange Commission:
Public Reference Room
450 Fifth Street, N.W.
Room 1024
Washington, D.C. 20549
You may also obtain copies of this information by mail from the Public
Reference Section of the Securities and Exchange Commission, 450 Fifth Street,
N.W., Room 1024, Washington, DC 20549, at prescribed rates. Please call the
Securities and Exchange Commission at (800) 732-0330 for further information
about the Public Reference Room.
The Securities and Exchange Commission also maintains an internet
website that contains reports, proxy statements and other information about
issuers that file electronically with the Securities and Exchange Commission.
The address of that site is www.sec.gov.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
We are "incorporating by reference" into this prospectus certain
information that we file with the Securities and Exchange Commission, which
means that we are disclosing important information to you by referring you to
those documents. The information incorporated by reference is deemed to be part
of this prospectus, except for any information superseded by information
contained directly in this prospectus. This prospectus incorporates by reference
the documents set forth below that we have previously filed with the Securities
and Exchange Commission. These documents contain important information about us
and our finances.
AFG SEC FILINGS (FILE NO. 1-13653) PERIOD
---------------------------------- ------
Annual Report on Form 10-K, as amended Year Ended December 31, 2002
Quarterly Report on Form 10-Q, as amended Quarter Ended March 31, 2003
Current Reports on Form 8-K Dated February 19, 2003, May 1, 2003
and May 27, 2003
All documents that we file with the Securities and Exchange Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act
from the date of this prospectus to the end of the offering of the securities
under this document shall also be deemed to be incorporated herein by reference.
Any statement contained in this prospectus or in a document incorporated or
deemed to be incorporated by reference into this prospectus will be deemed to be
modified or superseded for purposes of this prospectus to the extent that a
statement contained in this prospectus or any other subsequently filed document
that is deemed to be incorporated by reference into this prospectus modifies or
supersedes the statement. Any statement so modified or superseded will not be
deemed, except as so modified or superseded, to constitute a part of this
prospectus.
ii
You may request a copy of these filings, at no cost, by writing or
calling us at the following address or telephone number:
James C. Kennedy
Vice President, Deputy General Counsel and Secretary
American Financial Group, Inc.
One East Fourth Street
Cincinnati, Ohio 45202
(513) 579-2538
Exhibits to the filings will not be sent, however, unless those
exhibits have specifically been incorporated by reference in this prospectus.
Information contained on our website is not intended to be incorporated
by reference in this prospectus and you should not consider that information a
part of this prospectus.
No separate financial statements of the three trusts have been included
and none are incorporated by reference in this prospectus. We do not believe
that financial statements of the trusts would be useful because the trusts have
had no historical operations and will not have any independent function other
than to issue securities representing undivided interests in its assets and
investing the proceeds in our debt securities. In addition, all obligations of
the trusts are fully and unconditionally guaranteed by us.
You should rely only on the information incorporated by reference or
provided in this prospectus and the prospectus supplement. No one else is
authorized to provide you with any other information or any different
information. Neither we nor the trusts are making an offer of securities in any
state where an offer is not permitted. You should not assume that the
information in this prospectus is accurate as of any date other than the date on
the front of this document.
SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS
This prospectus (including the information incorporated by reference)
contains forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
Forward-looking statements are subject to numerous assumptions, risks or
uncertainties. The Private Securities Litigation Reform Act of 1995 provides a
safe harbor for forward-looking statements. Some of the forward-looking
statements can be identified by the use of forward-looking words such as
"anticipates", "believes", "expects", "estimates", "intends", "plans", "seeks",
"could", "may", "should", "will" or the negative version of those words or other
comparable terminology. Examples of such forward-looking statements include
statements relating to: expectations concerning market and other conditions and
their effect on future premiums, revenues, earnings and investment activities;
expected losses and the adequacy of reserves for asbestos, environmental
pollution and mass tort claims, rate increases, improved loss experience and
expected expense savings resulting from recent initiatives.
Actual results could differ materially from those contained in or
implied by such forward-looking statements for a variety of factors including:
- changes in economic conditions, including interest rates,
performance of securities markets and the availability of
capital;
- regulatory actions;
iii
- changes in legal environment;
- tax law changes;
- levels of natural catastrophes, terrorist events, incidents of
war and other major losses;
- the ultimate amount of liabilities associated with certain
asbestos and environmental-related claims;
- the unpredictability of possible future litigation if certain
settlements do not become effective;
- adequacy of insurance reserves;
- trends in mortality and morbidity;
- availability of reinsurance and ability of reinsurers to pay
their obligations;
- competitive pressures, including the ability to obtain rate
increases; and
- changes in debt and claims paying ratings.
All forward-looking statements address matters that involve risks and
uncertainties. Accordingly, there are or will be important factors that could
cause actual results to differ materially from those indicated in these
statements. Neither we nor any trust undertake any obligation to publicly update
or review any forward-looking statement.
iv
AMERICAN FINANCIAL GROUP, INC.
We are a holding company which, through subsidiaries, is engaged
primarily in property and casualty insurance, focusing on specialized commercial
products for businesses, and in the sale of retirement annuities, life, and
supplemental health insurance products. We were incorporated as an Ohio
corporation in 1997 for the purpose of merging predecessor holding companies
which had originated in 1955. Our insurance subsidiaries have been operating as
far back as the 1800's. Our address is One East Fourth Street, Cincinnati, Ohio
45202; our phone number is (513) 579-2121. SEC filings, news releases and other
information may be accessed free of charge through our Internet site at:
www.amfnl.com.
Our predecessor had been formed in 1994 for the purpose of acquiring
American Financial Corporation and American Premier Underwriters, Inc. in merger
transactions completed in 1995.
Over the years, we and our predecessors have owned, operated, and
invested in businesses in a variety of industries and geographic areas,
culminating in today's group of insurance companies. Generally, our interests
have been in the following areas: insurance, savings and loan, leasing, banking,
real estate, communications/entertainment and food distribution. A small number
of opportunistic investments have been made in troubled and other undervalued
assets.
THE AMERICAN FINANCIAL CAPITAL TRUSTS
American Financial Capital Trust II, American Financial Capital Trust
III and American Financial Capital Trust IV are statutory business trusts formed
under Delaware law pursuant to three separate declarations of trust executed by
us, as sponsor, and the trustees (described below) for the trusts and the filing
of three separate certificates of trust with the Delaware Secretary of State.
Each trust's declaration will be amended and restated as of the date the
securities of such trust are initially issued. The amended declaration will be
qualified as an indenture under the Trust Indenture Act of 1939. Unless the
context otherwise indicates, all references to the "trust" or the "trusts" in
this prospectus shall mean the American Financial Capital Trust II, American
Financial Capital Trust III and American Financial Capital Trust IV.
Each trust exists solely to:
- issue its preferred securities and common securities
representing undivided beneficial interests in the assets of
that trust;
- invest the proceeds from the issuance of those securities in
our junior subordinated debt securities; and
- engage only in incidental activities.
The rights of the holders of each trust's securities, including
economic rights, rights to information and voting rights, are set forth in the
trust's amended declaration of the trust, the Delaware Business Trust Act and
the Trust Indenture Act.
We will own, directly or indirectly, all of the common securities of
each trust, which will have an aggregate liquidation amount equal to 3% of the
total capital of each trust. The common securities will generally rank equally
in right of payment with the preferred securities, and payments on both will be
made pro rata. However, upon an event of default under a trust's amended
declaration, the rights of the holders of the common securities to payment of
distributions and payments upon liquidation, redemption and otherwise will be
subordinated to the rights of the holders of the preferred securities. We will
pay all fees and expenses related to the trusts and the offering of each trust's
securities.
1
We, as holder of all of the common securities, will be entitled to
appoint, remove or replace any of, or increase or reduce the number of, the
trustees of the trusts. The business and affairs of the trusts will be conducted
by the trustees, and the duties and obligations of the trustees will be governed
by the applicable amended declarations of the trusts.
At least two of the trustees of each trust will be persons who are
employees or officers of, or otherwise affiliated with, us. These persons are
sometimes referred to herein as "regular" trustees. One trustee of each trust
will be a financial institution which will be unaffiliated with us and which
will act as property trustee and as indenture trustee for purposes of the Trust
Indenture Act under the terms of the applicable amended declaration and as may
be further described in a prospectus supplement. The property trustee will hold
title to the junior subordinated debt securities for the benefit of the holders
of each trust's securities. In addition, unless the property trustee maintains a
principal place of business in the State of Delaware and otherwise meets the
requirements of applicable law, one trustee of each trust will be a legal entity
having a principal place of business in, or an individual resident of, the State
of Delaware.
Unless otherwise indicated in a prospectus supplement, The Bank of New
York will be the property trustee and The Bank of New York (Delaware) will be
the Delaware trustee. The address of the principal corporate trust office of The
Bank of New York is 101 Barclay Street, New York, New York, 10286 and for The
Bank of New York (Delaware) is 502 White Clay Center, Route 273, Newark,
Delaware, 19711. The principal place of business of the trusts will be c/o
American Financial Group, Inc., One East Fourth Street, Cincinnati, Ohio, 45202,
telephone number (513) 579-2121.
2
USE OF PROCEEDS
Unless otherwise indicated in an accompanying prospectus supplement, we
expect to use the net proceeds from the sale of any securities offered hereby
for general corporate purposes, which may include investment in insurance
businesses and the repayment of our outstanding debt and the debt of our
subsidiaries. Until the net proceeds are used for these purposes, we may deposit
them in interest-bearing accounts or invest them in short-term marketable
securities. The specific allocations, if any, of the proceeds of any of the
securities will be described in the prospectus supplement. The proceeds from any
sale of preferred securities by any trust will be invested in our debt
securities.
RATIO OF EARNINGS TO FIXED CHARGES
Fixed charges are computed on a "total enterprise" basis. For purposes
of calculating the ratios, "earnings" have been computed by adding to pretax
earnings the fixed charges and the minority interest in earnings of subsidiaries
having fixed charges and the undistributed equity in losses of investees. Fixed
charges include interest (including or excluding interest credited to annuity
policyholders' accounts as indicated), amortization of debt premium/discount and
expense, preferred dividend and distribution requirements of subsidiaries and a
portion of rental expense deemed to be representative of the interest factor.
Although the ratio of earnings to fixed charges excluding interest on annuities
is not required or encouraged to be disclosed under Securities and Exchange
Commission rules, some investors and lenders may not consider interest credited
to annuity policyholders' accounts a borrowing cost for an insurance company,
and accordingly, believe this ratio is meaningful.
THREE MONTHS ENDED
MARCH 31, YEAR ENDED DECEMBER 31,
-------------------- -----------------------------------------------------
2003 2002 2002 2001 2000 1999 1998
-------- ------- ------- -------- ------- ------- -------
Including Annuity Benefits 1.31 1.43 1.37 1.06 1.18 1.71 1.65
Excluding Annuity Benefits 2.25 2.72 2.42 1.21 1.63 3.36 3.22
DESCRIPTION OF THE SECURITIES WE MAY OFFER
GENERAL
We may issue, in one or more offerings, any combination of senior or
subordinated debt securities, common stock, preferred stock, warrants,
depositary shares, stock purchase contracts and stock purchase units. The trusts
may issue in one or more offerings, trust preferred securities that will be
unconditionally guaranteed by us.
This prospectus contains a summary of the general terms of the various
securities that we or the trusts may offer. The prospectus supplement relating
to any particular securities offered will describe the specific terms of the
securities, which may be in addition to or different from the general terms
summarized in this prospectus. The summary in this prospectus and in any
prospectus supplement does not describe every aspect of the securities and is
subject to and qualified in its entirety by reference to all applicable
provisions of the documents relating to the securities offered. These documents
are or will be filed as exhibits to or incorporated by reference in the
registration statement.
In addition, the prospectus supplement will set forth the terms of the
offering, the initial public offering price and net proceeds to us or the
trusts. Where applicable, the prospectus supplement will also describe any
material United States federal income tax considerations relating to the
securities offered and indicate whether the securities offered are or will be
listed on any securities exchange.
3
BOOK-ENTRY SYSTEM
Unless otherwise indicated in a prospectus supplement, the debt
securities and preferred securities offered by us and the trusts will be issued
in the form of one or more fully registered global securities. These global
securities will be deposited with, or on behalf of, the Depository Trust Company
and registered in the name of its nominee. Except as described below, the global
securities may be transferred, in whole and not in part, only to DTC or to
another nominee of DTC.
DTC has advised us that it 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 Securities Exchange Act of 1934.
DTC was created to hold securities for institutions that have accounts
with DTC ("participants") and to facilitate the clearance and settlement of
securities transactions among its participants through electronic book-entry
changes in participants' accounts. Participants include securities brokers and
dealers, banks, trust companies, clearing corporations and certain other
organizations, some of whom (and/or their representatives) own DTC. Access to
DTC's book-entry system is also available to others that clear through or
maintain a custodial relationship with a participant, either directly or
indirectly. DTC administers its book-entry system in accordance with its rules
and bylaws and legal requirements.
Upon issuance of a global security representing offered securities, DTC
will credit on its book-entry registration and transfer system the principal
amount to participants' accounts. Ownership of beneficial interests in the
global security will be limited to participants or to persons that hold
interests through participants. Ownership of interests in the global security
will be shown on, and the transfer of those ownership interests will be effected
only through, records maintained by DTC (with respect to participants'
interests) and the participants (with respect to the owners of beneficial
interests in the global security). The laws of some jurisdictions may require
that certain purchasers of securities take physical delivery of those securities
in definitive form. These limits and laws may impair the ability to transfer
beneficial interests in a global security.
So long as DTC (or its nominee), is the registered holder and owner of
a global security, DTC (or its nominee) will be considered, for all purposes
under the applicable indenture, the sole owner and holder of the related offered
securities. Except as described below, owners of beneficial interests in a
global security will not:
- be entitled to have the offered securities registered in their
names; or
- receive or be entitled to receive physical delivery of
certificated offered securities in definitive form.
4
Each person owning a beneficial interest in a global security must rely
on DTC's procedures (and, if that person holds through a participant, on the
participant's procedures) to exercise any rights of a holder of offered
securities under the global security or any applicable indenture, or otherwise.
The indentures provide that DTC may grant proxies and otherwise authorize
participants to take any action which it (as the holder of a global security) is
entitled to take under the indentures or the global security. We understand that
under existing industry practice, if we or a trust request any action of holders
or an owner of a beneficial interest in a global security desires to take any
action that DTC (as the holder of the global security) is entitled to take, DTC
would authorize the participants to take that action and the participants would
authorize their beneficial owners to take the action or would otherwise act upon
the instructions of their beneficial owners.
We or the trusts will make payments with respect to offered securities
represented by a global security to DTC. We expect that DTC, upon receipt of any
payments, will immediately credit participants' accounts with payments in
amounts proportionate to their respective beneficial interests. We also expect
that payments by participants to owners of beneficial interests in a global
security held through them will be governed by standing instructions and
customary practices (as is the case with securities held for customers' accounts
in "street name") and will be the responsibility of the participants. None of
us, the trusts or any trustee will have any responsibility or liability for:
- any aspect of the records relating to, or payments made on
account of, beneficial ownership interests in a global
security for any securities;
- maintaining, supervising, or reviewing any records relating to
any beneficial ownership interests;
- any other aspect of the relationship between DTC and its
participants; or
- the relationship between the participants and the owners of
beneficial interests in a global security.
Unless and until they are exchanged in whole or in part for
certificated securities in definitive form, the global securities may not be
transferred except as a whole by DTC to its nominee or by its nominee to DTC or
another nominee.
The securities of any series represented by a global security may be
exchanged for certificated securities in definitive form if:
- DTC notifies us that it is unwilling or unable to continue as
depositary for the global security or if at any time it ceases
to be a clearing agency registered under the Securities
Exchange Act of 1934;
- we decide at any time not to have the securities of that
series represented by a global security and so notifies DTC;
or
- in the case of debt securities, an event of default has
occurred and is continuing with respect to the debt
securities.
If there is such an exchange, we will issue certificated securities in
authorized denominations and registered in such names as DTC directs. Subject to
the foregoing, a global security is not exchangeable, except for a global
security of the same aggregate denomination to be registered in DTC's or its
nominee's name.
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DESCRIPTION OF DEBT SECURITIES
GENERAL
The debt securities are governed by documents called "indentures." An
indenture is a contract between American Financial Group and the trustee named
in the applicable prospectus supplement, which acts as trustee for the debt
securities. There may be more than one trustee under each indenture for
different series of debt securities. The trustee has two main roles. First, the
trustee can enforce your rights against us if we default. There are some
limitations on the extent to which the trustee acts on your behalf, described
under "Remedies If An Event of Default Occurs." Second, the trustee may perform
administrative duties for us, such as sending you interest payments,
transferring your debt securities to a new buyer if you sell, and sending you
notices. We anticipate that we will perform these duties with respect to the
debt securities.
The debt securities will be unsecured general obligations of us and may
include:
- senior debt securities, to be issued under the senior
indenture;
- subordinated debt securities, to be issued under the
subordinated indenture; and
- junior subordinated debt securities, to be issued under the
junior subordinated indenture in conjunction with the issuance
of preferred securities of the trusts.
If issued, the junior subordinated debt securities will be purchased by a trust
using proceeds from issuances of the preferred securities of such trust. When we
refer to the indenture we mean the senior indenture, the subordinated indenture
and the junior subordinated indenture collectively, unless we indicate
otherwise. When we refer to the trustee we mean the senior trustee, the
subordinated trustee and the junior subordinated trustee collectively, unless we
indicate otherwise.
This section summarizes the general terms of the debt securities we may
offer. The prospectus supplement relating to any particular debt securities
offered will indicate whether the debt securities are senior debt securities,
subordinated debt securities or junior subordinated debt securities and will
describe the specific terms of the debt securities, which may be in addition to
or different from the general terms summarized in this section. The summary in
this section and in any prospectus supplement does not describe every aspect of
the senior, subordinated or junior subordinated indenture or the debt
securities, and is subject to and qualified in its entirety by reference to all
the provisions of the applicable indenture and the debt securities. The forms of
the senior indenture, subordinated indenture and junior subordinated indenture
and the forms of the debt securities are or will be filed as exhibits to or
incorporated by reference in the registration statement. See "Where You Can Find
More Information" for information on how to obtain a copy.
The prospectus supplement relating to any series of debt securities
will describe the following specific financial, legal and other terms particular
to such series of debt securities:
- the title of the debt securities;
- any limit on the aggregate principal amount of the debt
securities;
- the date or dates on which the debt securities will mature;
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- the rate or rates (which may be fixed or variable) at which
the debt securities will bear interest, if any, and the date
or dates from which the interest will accrue;
- the dates on which interest on the debt securities will be
payable and the regular record dates for those interest
payment dates;
- the place or places where the principal of and premium, if
any, and interest shall be payable, where the debt securities
may be surrendered for transfer or exchange, and where notices
may be served;
- the date, if any, after which and the price or prices at which
the debt securities may, in accordance with any option or
mandatory redemption provisions, be redeemed and the other
detailed terms and provisions of any such optional or
mandatory redemption provision;
- any mandatory or optional sinking funds or analogous
provisions or provisions for redemption at the holder's
option;
- if other than denominations of $1,000 and any integral
multiple thereof, the denomination in which the debt
securities will be issuable;
- if other than the principal amount thereof, the portion of the
principal amount of the debt securities which will be payable
upon the declaration of acceleration of the maturity of those
debt securities;
- any addition to, or modification or deletion of, any events of
default or covenants with respect to the securities;
- any index or formula used to determine the amount of payment
of principal of, premium, if any, and interest on the debt
securities;
- any provision relating to the defeasance of our obligations in
connection with the debt securities;
- any provision regarding exchangeability or conversion of the
debt securities into our common stock or other securities;
- whether any debt securities will be issued in the form of a
global security, and, if different than described above under
"Description of the Securities We May Offer--Book Entry
System," any circumstances under which a global security may
be exchanged for debt securities registered in the names of
persons other than the depositary for the global security or
its nominee;
- whether the debt securities are senior, subordinated or junior
subordinated debt securities;
- the subordination provisions applicable to the subordinated
debt securities or junior subordinated debt securities; and
- any other material terms of the debt securities.
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The terms of any series of debt securities may vary from the terms
described here. Thus, this summary also is subject to and qualified by reference
to the description of the particular terms of your debt securities to be
described in the prospectus supplement. The prospectus supplement relating to
the debt securities will be attached to the front of this prospectus.
The indenture and its associated documents contain the full legal text
of the matters described in this section. The indenture and the debt securities
are governed by Ohio law.
EVENTS OF DEFAULT
General
You will have special rights if an "event of default" occurs, with
respect to any series, and is not cured, as described later in this subsection.
Under the indenture, the term "event of default" means any of the following:
- we do not pay interest on a debt security, in the case of
senior debt securities or subordinated debt securities, within
30 days of its due date and, in the case of junior
subordinated debt securities, within 60 days of its due date;
- we do not pay the principal or any premium on a debt security
on its due date;
- we remain in breach of any covenant or warranty described in
the indenture for 60 days after we receive a notice stating we
are in breach. In the case of senior debt securities or
subordinated debt securities, the notice must be sent by
either the trustee or direct holders of at least 25% of the
principal amount of outstanding debt securities, and in the
case of the junior subordinated debt securities, the notice
must be sent by the trustee;
- we fail to pay an amount of debt (other than the debt
securities) totaling more than $10,000,000 ($15,000,000 in the
case of junior subordinated debt securities), our obligation
to repay is accelerated by our lenders, and this payment
obligation remains accelerated for 10 days after we receive
notice of default as described in the previous paragraph;
- we become subject to final, non-appealable judgments, orders
or decrees requiring payments of more than $10,000,000
($15,000,000 in the case of junior subordinated debt
securities) and such judgment, order or decree remains
unsatisfied for 60 days (30 days in the case of junior
subordinated debt securities) during which a stay of
enforcement has not been in effect after we receive notice as
described two paragraphs above; or
- certain events of bankruptcy, insolvency or reorganization of
us.
Remedies if an Event of Default Occurs
If an event of default has occurred and has not been cured, the trustee
or the direct holders of 25% in principal amount of the outstanding debt
securities of the affected series, or any holder of preferred securities in the
case of an event of default with respect to the junior subordinated debt
securities, may declare the entire principal amount of all the debt securities
of that series to be due and immediately payable. This is called a "declaration
of acceleration of maturity."
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Except in cases of default, where a trustee has some special duties, a
trustee is not required to take any action under the indenture at the request of
any direct holders unless the direct holders offer the trustee reasonable
protection from expenses and liability (called an "indemnity"). If reasonable
indemnity is provided, the direct holders of a majority in principal amount of
the outstanding debt securities of the relevant series may direct the time,
method and place of conducting any lawsuit or other formal legal action seeking
any remedy available to the trustee. These majority direct holders may also
direct the trustee in performing any other action under the indenture.
In general, before you bypass the trustee and bring your own lawsuit or
other formal legal action or take other steps to enforce your rights or protect
your interests relating to the debt securities, the following must occur:
- you must give the trustee written notice that an event of
default has occurred and remains uncured;
- the direct holders of 25% in principal amount of all
outstanding debt securities of the relevant series must make a
written request that the trustee take action because of the
default, and must offer reasonable indemnity to the trustee
against the cost and other liabilities of taking that action;
- the trustee must have not taken action for 60 days after
receipt of the above notice and offer of indemnity; and
- the trustee must not have received from direct holders of a
majority in principal amount of the outstanding debt
securities of that series a direction inconsistent with the
written notice during the 60 day period after receipt of the
above notice.
However, you are entitled at any time to bring a lawsuit for the
payment of money due on your debt security on or after its due date.
MODIFICATION
There are three types of changes we can make to the indentures and the
debt securities.
Changes Requiring Your Approval
First, there are changes that cannot be made to the indentures or your
debt securities without your specific approval. Following is a list of those
types of changes:
- change the payment due date of the principal or interest on a
debt security;
- reduce any amounts due on a debt security;
- reduce the amount of principal payable upon acceleration of
the maturity of a debt security following a default;
- change the place of payment on a debt security;
- impair your right to sue for payment;
- reduce the percentage in principal amount of debt securities,
the consent of whose holders is required to modify or amend
the indenture;
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- reduce the percentage in principal amount of debt securities,
the consent of whose holders is required to waive compliance
with certain provisions of the indenture or to waive certain
defaults; and
- modify any other aspect of the provisions dealing with
modification and waiver of the indenture.
Changes Requiring a Majority Vote
The second type of change to the indentures and the debt securities is
the kind that requires consent of the holders of a majority in principal amount
of the outstanding debt securities of the particular series affected. With a
majority vote, the holders may waive past defaults, provided that such defaults
are not of the type described previously under "Changes Requiring Your
Approval".
Changes Not Requiring Approval
The third type of change does not require any vote by direct holders of
debt securities. This type is limited to clarifications and certain other
changes that would not adversely affect holders of the debt securities.
CONSOLIDATION, MERGER AND SALE OF ASSETS
We may consolidate or merge with or into another entity, and we may
sell or lease substantially all of our assets to another corporation if the
following conditions, among others, are met:
- where we merge out of existence or sell or lease substantially
all our assets, the other entity must be a corporation,
partnership or trust organized under the laws of a State or
the District of Columbia or under federal law, and it must
agree to be legally responsible for the debt securities; and
- the merger, sale of assets or other transaction must not cause
a default or an event of default on the debt securities.
FORM, EXCHANGE, REGISTRATION AND TRANSFER
Generally, we will issue debt securities only in registered global
form. However, if specified in the prospectus supplement or in the certain
instances described in "Description of the Securities We May Offer -- Book-Entry
System", we may issue certificated securities in definitive form.
You may have your debt securities broken into more debt securities of
smaller denominations or combined into fewer debt securities of larger
denominations, as long as the total principal amount is not changed. This is
called an "exchange."
You may exchange or transfer debt securities at the office of the
trustee. The trustee acts as our agent for registering debt securities in the
names of holders and transferring debt securities. We may appoint another entity
or perform this role ourselves. The entity performing the role of maintaining
the list of registered direct holders is called the "security registrar." It
will also perform transfers. You will not be required to pay a service charge to
transfer or exchange debt securities, but you may be required to pay for any tax
or other governmental charge associated with the exchange or transfer. The
transfer or exchange will only be made if the security registrar is satisfied
with your proof of ownership.
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If the debt securities are redeemable and we redeem less than all of
the debt securities of a particular series, we may block the transfer or
exchange of those debt securities during the period beginning 15 days before the
day we mail the notice of redemption and ending on the day of that mailing, in
order to freeze the list of holders to prepare the mailing. We may also refuse
to register transfers or exchanges of debt securities selected for redemption,
except that we will continue to permit transfers and exchanges of the unredeemed
portion of any debt security being partially redeemed.
PAYMENT AND PAYING AGENTS
We will pay interest to you if you are a direct holder listed in the
trustee's records at the close of business on a particular day in advance of
each due date for interest, even if you no longer own the debt security on the
interest due date. That particular day, usually about two weeks in advance of
the interest due date, is called the "regular record date" and will be stated in
the prospectus supplement. Holders buying and selling debt securities must work
out between them how to compensate for the fact that we will pay all the
interest for an interest period to the one who is the registered holder on the
regular record date. The most common manner is to adjust the sales price of the
debt securities to prorate interest fairly between buyer and seller. This
prorated interest amount is called "accrued interest."
In the past, we have chosen to pay interest by mailing checks. We may
also choose to pay interest, principal and any other money due on the debt
securities at the corporate trust office of the trustee. You must make
arrangements to have your payments picked up at or wired from the trust office.
We may also arrange for additional payment offices, and may cancel or
change these offices, including our use of the trustee's corporate trust office.
These offices are called "paying agents" We may also choose to act as our own
paying agent. We must notify you of changes in the paying agents for any
particular series of debt securities.
NOTICES
Notices to holders of debt securities will be given by mail to the
addresses of such holders as they appear in the security register.
PROVISIONS APPLICABLE TO JUNIOR SUBORDINATED DEBT SECURITIES
The following provisions will apply solely to junior subordinated debt
securities.
Events of Default
In addition to the events described above under "Description of Debt
Securities -- Events of Default" applicable to all debt securities, the
voluntary or involuntary dissolution, winding up or termination of a trust that
owns the series of junior subordinated debt securities will constitute an event
of default for any series of junior subordinated debt securities, except in
connection with:
- the distribution of such junior subordinated debt securities
to holders of the trust's securities;
- the redemption of all of the trust's securities; and
- mergers, consolidations or similar events permitted by the
amended declaration of the trust.
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The holders of at least a majority in aggregate liquidation amount of
the trust preferred securities of a trust may waive any default or event of
default with respect to such series and its consequences, except defaults or
events of default that are not waivable under the junior subordinated indenture
(such as defaults regarding payment of principal, premium, if any, or interest).
Any waiver will cure the default or event of default. If, under the
amended declaration of the trust, an event of default has occurred and is
attributable to the failure of us to pay principal, premium, if any, or interest
on, such junior subordinated debt securities, then each holder of the preferred
securities of the trust may sue us or seek other remedies, to force payment to
such holder of the principal of, premium, if any, or interest on, such junior
subordinated debt securities having a principal amount equal to the aggregate
liquidation amount of the preferred securities held by such holder.
Subordination of Junior Subordinated Debt Securities
The junior subordinated debt securities will be unsecured and will be
subordinate and junior in priority of payment to certain of our other
indebtedness to the extent described in a prospectus supplement. The junior
subordinated indenture will not limit the amount of junior subordinated debt
securities which we may issue, nor does it limit us from issuing any other
secured or unsecured debt.
DESCRIPTION OF COMMON STOCK
This section summarizes the general terms of the common stock that we
may offer. The prospectus supplement relating to the common stock offered will
set forth the number of shares offered, the initial offering price and recent
market prices, dividend information and any other relevant information. The
summary in this section and in the prospectus supplement does not describe every
aspect of the common stock and is subject to and qualified in its entirety by
reference to all the provisions of our Amended and Restated Articles of
Incorporation and Code of Regulations and to the provisions of the Ohio General
Corporation Law.
The total number of authorized shares of common stock is 200,000,000.
Holders of common stock are entitled to one vote for each share held of record
on all matters submitted to a vote of shareholders. Holders of common stock have
the right to cumulate their votes in the election of directors but are not
entitled to any preemptive rights.
Subject to restrictions under agreements related to our indebtedness
and to preferences which may be granted to holders of preferred stock, holders
of common stock are entitled to the share of such dividends as board of
directors, in its discretion, may validly declare from funds legally available.
In the event of liquidation, each outstanding share of common stock entitles its
holder to participate ratably in the assets remaining after the payment of
liabilities and any preferred stock liquidation preferences.
As of March 31, 2003, there were 69,527,781 shares of common stock
issued and outstanding, including 1,361,711 shares held by a subsidiary for
distribution to certain creditors. Shares of common stock carry no conversion
subscription rights and are not subject to redemption. All outstanding shares of
common stock are, and any shares of common stock issued upon conversion of any
convertible securities will be, fully paid and nonassessable.
The outstanding shares of our common stock are listed on the New York
Stock Exchange and trade under the symbol "AFG." We act as our own transfer
agent and registrar.
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DESCRIPTION OF PREFERRED STOCK
The following briefly summarizes the material terms of the preferred
stock that we may offer, other than pricing and related terms disclosed in a
prospectus supplement. You should read the particular terms of any series of
preferred stock that we offer which we will describe in more detail in any
prospectus supplement relating to such series. You should also read the more
detailed provisions of our Amended and Restated Articles of Incorporation and
the statement with respect to shares relating to each particular series of
preferred stock for provisions that may be important to you. The statement with
respect to shares relating to each particular series of preferred stock offered
by the accompanying prospectus supplement and this prospectus will be filed as
an exhibit to a document incorporated by reference in the registration
statement. The prospectus supplement will also state whether any of the terms
summarized below do not apply to the series of preferred stock being offered.
GENERAL
Our board of directors is authorized to issue up to 12,500,000 shares
of voting preferred stock and up to 12,500,000 shares of non-voting preferred
stock. Our board of directors can issue shares of preferred stock in one or more
series and can specify the following terms for each series:
- the number of shares;
- the designation, powers, preferences and rights of the shares;
and
- the qualifications, limitations or restrictions, except as
otherwise stated in the articles of incorporation.
Before issuing any series of preferred stock, our board of directors
will adopt resolutions creating and designating the series as a series of
preferred stock, and the resolutions will be filed in a statement with respect
to shares as an amendment to the articles of incorporation.
The rights of holders of the preferred stock offered may be adversely
affected by the rights of holders of any shares of preferred stock that may be
issued in the future. Our board of directors may cause shares of preferred stock
to be issued in public or private transactions for any proper corporate purpose.
Examples include issuances to obtain additional financing in connection with
acquisitions or otherwise, and issuances to our officers, directors and
employees and our subsidiaries pursuant to benefit plans or otherwise. The
preferred stock could have the effect of acting as an anti-takeover device to
prevent a change in control of us.
Unless the particular prospectus supplement states otherwise, holders
of each series of preferred stock will not have any preemptive or subscription
rights to acquire more of our stock.
The transfer agent, registrar, dividend disbursing agent and redemption
agent for shares of each series of preferred stock will be named in the
prospectus supplement relating to such series.
RANK
Unless otherwise specified in the prospectus supplement relating to the
shares of any series of preferred stock, the shares will rank on an equal basis
with each other series of preferred stock and prior to the common stock as to
dividends and distributions of assets.
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DIVIDENDS
Unless the particular prospectus supplement states otherwise, holders
of each series of preferred stock will be entitled to receive cash dividends,
when, as and if declared by our board of directors out of funds legally
available for dividends. The rates and dates of payment of dividends will be set
forth in the prospectus supplement relating to each series of preferred stock.
Dividends will be payable to holders of record of preferred stock as they appear
on our books. Dividends on any series of preferred stock may be cumulative or
noncumulative.
We may not declare, pay or set apart for payment dividends on the
preferred stock unless full dividends on any other series of preferred stock
that ranks on an equal or senior basis have been paid or sufficient funds have
been set apart for payment for:
- all prior dividend periods of the other series of preferred
stock that pay dividends on a cumulative basis; or
- the immediately preceding dividend period of the other series
of preferred stock that pay dividends on a noncumulative
basis.
Partial dividends declared on shares of preferred stock and any other
series of preferred stock ranking on an equal basis as to dividends will be
declared pro rata. A pro rata declaration means that the ratio of dividends
declared per share to accrued dividends per share will be the same for all such
series of preferred stock.
Similarly, we may not declare, pay or set apart for payment non-stock
dividends or make other payments on the common stock or any other stock of ours
ranking junior to the preferred stock unless full dividends on all series of
preferred stock have been paid or set apart for payment for:
- all prior dividend periods if the preferred stock pays
dividends on a cumulative basis; or
- the immediately preceding dividend period if the preferred
stock pays dividends on a noncumulative basis.
CONVERSION AND EXCHANGE
The prospectus supplement for any series of preferred stock will state
the terms, if any, on which shares of that series are convertible into or
exchangeable for shares of our common stock.
REDEMPTION
If so specified in the applicable prospectus supplement, a series of
preferred stock may be redeemable at any time, in whole or in part, at our
option or at the option of the holders, or may be mandatorily redeemed.
Any partial redemptions of preferred stock will be made in a way that
our board of directors decides is equitable.
Unless we default in the payment of the redemption price, dividends
will cease to accrue after the redemption date on shares of preferred stock
called for redemption and all rights of holders of such shares will terminate
except for the right to receive the redemption price.
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LIQUIDATION PREFERENCE
Upon our voluntary or involuntary liquidation, dissolution or winding
up, holders of each series of preferred stock will be entitled to receive
distributions upon liquidation in the amount set forth in the prospectus
supplement relating to such series of preferred stock, plus an amount equal to
any accrued and unpaid dividends. Such distributions will be made before any
distribution is made on any securities ranking junior to the preferred stock
with respect to liquidation, including common stock.
If the liquidation amounts payable relating to the preferred stock of
any series and any other securities ranking on a parity regarding liquidation
rights are not paid in full, the holders of the preferred stock of such series
and such other securities will share in any such distribution of our available
assets on a ratable basis in proportion to the full liquidation preferences.
Holders of such series of preferred stock will not be entitled to any other
amounts from us after they have received their full liquidation preference.
VOTING RIGHTS
If we issue voting preferred stock, holders of preferred stock will be
entitled to one vote per share on each matter submitted to our shareholders. If
we issue non-voting preferred stock, holders of preferred stock will have no
voting rights, except as required by applicable law. The prospectus supplement
will state the voting rights, if any, applicable to any particular series of
preferred stock.
DESCRIPTION OF WARRANTS
We may issue warrants for the purchase common stock, debt securities or
other securities registered pursuant to this registration statement and
described in this prospectus. We may issue warrants independently or together
with other securities that may be attached to or separate from the warrants. We
will issue each series of warrants under a separate warrant agreement that will
be entered into between us and a bank or trust company, as warrant agent, and
will be described in the prospectus supplement relating to the particular issue
of warrants. The warrant agent will act solely as our agent in connection with
the warrant of such series and will not assume any obligation or relationship of
agency for or with holders or beneficial owners of warrants. The following
describes certain general terms and provisions of debt warrants or common stock
warrants we may offer. We will set forth further terms of the debt warrants,
common stock warrants or warrants to purchase other securities and the
applicable warrant agreement in the applicable prospectus supplement.
DEBT WARRANTS
The applicable prospectus supplement will describe the terms of any
debt warrants, including the following:
- the title of the debt warrants;
- the offering price for the debt warrants;
- the aggregate number of the debt warrants;
- the designation and terms of the debt securities purchasable
upon exercise of such debt warrants;
- if applicable, the designation and terms of the securities
with which such debt warrants are issued and the number of
such debt warrants issued with each security;
- if applicable, the date from and after which such debt
warrants and any securities issued therewith will be
separately transferable;
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- the principal amount of debt securities purchasable upon
exercise of a debt warrant and the price at which such
principal amount of debt securities may be purchased upon
exercise;
- the date on which the right to exercise such debt warrants
shall commence and the date on which such right shall expire;
- if applicable, the minimum or maximum amount of such debt
warrants which may be exercised at any one time;
- whether the debt warrants represented by the debt warrant
certificates or debt securities that may be issued upon
exercise of the debt warrants will be issued in registered
form;
- information with respect to book-entry procedures, if any;
- the currency, currencies or currency units in which the
offering price, if any, and the exercise price are payable;
- if applicable, a discussion of certain United States federal
income tax considerations;
- the identity of the warrant agent for the warrants;
- the antidilution provisions of such debt warrants, if any;
- the redemption or call provisions, if any, applicable to such
debt warrant; and
- any additional terms of the debt warrants, including terms,
procedures and limitations relating to the exchange and
exercise of such debt warrants.
COMMON STOCK WARRANTS
The applicable prospectus supplement will describe the terms of any
common stock warrants, including the following:
- the title of such warrants;
- the offering price of such warrants;
- the aggregate number of such warrants;
- the designation and terms of the common stock issued by us
purchasable upon exercise of such warrants;
- if applicable, the designation and terms of the securities
with which such warrants are issued and the number of such
warrants issued with each such security;
- if applicable, the date from and after which such warrants and
any securities issued therewith will be separately
transferable;
- the number of shares of common stock issued by us purchasable
upon exercise of the warrants and the price at which such
shares may be purchased upon exercise;
- the date on which the right to exercise such warrants shall
commence and the date on which such right shall expire;
- if applicable, the minimum or maximum amount of such warrants
which may be exercised at any one time;
- the currency, currencies or currency units in which the
offering price, if any, and the exercise price are payable;
- if applicable, a discussion of certain United States federal
income tax considerations;
- the identity of the warrant agent for the warrants; and
- the antidilution provisions of the warrants, if any.
DESCRIPTION OF DEPOSITARY SHARES
The following briefly summarizes the provisions of the depositary
shares and depositary receipts that we may issue from time to time and which
would be important to holders of depositary receipts, other than pricing and
related terms which will be disclosed in the applicable prospectus supplement.
The
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prospectus supplement will also state whether any of the general provisions
summarized below do not apply to the depositary shares or depositary receipts
being offered and provide any additional provisions applicable to the depositary
shares or depositary receipts being offered. The following description and any
description in a prospectus supplement may not be complete and is subject to,
and qualified in its entirety by reference to the terms and provisions of the
form of deposit agreement filed as an exhibit to the registration statement
which contains this prospectus.
DESCRIPTION OF DEPOSITARY SHARES
We may offer depositary shares evidenced by depositary receipts. Each
depositary share represents a fraction or a multiple of a share of a particular
series of preferred stock that we issue and deposit with a depositary. The
fraction or the multiple of a share of preferred stock which each depositary
share represents will be set forth in the applicable prospectus supplement.
We will deposit the shares of any series of preferred stock represented
by depositary shares according to the provisions of a deposit agreement to be
entered into between us and a bank or trust company which we will select as our
preferred stock depositary. We will name the depositary in the applicable
prospectus supplement. Each holder of a depositary share will be entitled to all
the rights and preferences of the underlying preferred stock in proportion to
the applicable fraction or multiple of a share of preferred stock represented by
the depositary share. These rights include any applicable dividend, voting,
redemption, conversion and liquidation rights. The depositary will send the
holders of depositary shares all reports and communications that we deliver to
the depositary and which we are required to furnish to the holders of depositary
shares.
DEPOSITARY RECEIPTS
The depositary shares will be evidenced by depositary receipts issued
pursuant to the deposit agreement. Depositary receipts will be distributed to
anyone who is buying the fractional shares of preferred stock in accordance with
the terms of the applicable prospectus supplement.
WITHDRAWAL OF PREFERRED STOCK
Unless the related depositary shares have previously been called for
redemption, a holder of depositary shares may receive the number of whole shares
of the related series of preferred stock and any money or other property
represented by the holder's depositary receipts after surrendering the
depositary receipts at the corporate trust office of the depositary, paying any
taxes, charges and fees provided for in the deposit agreement and complying with
any other requirement of the deposit agreement. Partial shares of preferred
stock will not be issued. If the surrendered depositary shares exceed the number
of depositary shares that represent the number of whole shares of preferred
stock the holder wishes to withdraw, then the depositary will deliver to the
holder at the same time a new depositary receipt evidencing the excess number of
depositary shares. Once the holder has withdrawn the preferred stock, the holder
will not be entitled to re-deposit that preferred stock under the deposit
agreement or to receive depositary shares in exchange for such preferred stock.
DIVIDENDS AND OTHER DISTRIBUTIONS
The depositary will distribute to record holders of depositary shares
any cash dividends or other cash distributions it receives on preferred stock.
Each holder will receive these distributions in proportion to the number of
depositary shares owned by the holder. The depositary will distribute only whole
U.S. dollars and cents. The depositary will add any fractional cents not
distributed to the next sum received for distribution to record holders of
depositary shares.
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In the event of a non-cash distribution, the depositary will distribute
property to the record holders of depositary shares, unless the depositary
determines that it is not feasible to make such a distribution. If this occurs,
the depositary may, with our approval, sell the property and distribute the net
proceeds from the sale to the holders.
The amounts distributed to holders of depositary shares will be reduced
by any amounts required to be withheld by the preferred stock depositary or by
us on account of taxes or other governmental charges.
REDEMPTION OF DEPOSITARY SHARES
If the series of preferred stock represented by depositary shares is
subject to redemption, then we will give the necessary proceeds to the
depositary. The depositary will then redeem the depositary shares using the
funds they received from us for the preferred stock. The redemption price per
depositary share will be equal to the redemption price payable per share for the
applicable series of the preferred stock and any other amounts per share payable
with respect to the preferred stock multiplied by the fraction of a share of
preferred stock represented by one depositary share. Whenever we redeem shares
of preferred stock held by the depositary, the depositary will redeem the
depositary shares representing the shares of preferred stock on the same day
provided we have paid in full to the depositary the redemption price of the
preferred stock to be redeemed and any accrued and unpaid dividends. If fewer
than all the depositary shares of a series are to be redeemed, the depositary
shares will be selected by lot or ratably or by any other equitable method as
the depositary will decide.
After the date fixed for redemption, the depositary shares called for
redemption will no longer be considered outstanding. Therefore, all rights of
holders of the depositary shares will cease, except that the holders will still
be entitled to receive any cash payable upon the redemption and any money or
other property to which the holder was entitled at the time of redemption. To
receive this amount or other property, the holders must surrender the depositary
receipts evidencing their depositary shares to the preferred stock depositary.
Any funds that we deposit with the preferred stock depositary for any depositary
shares that the holders fail to redeem will be returned to us after a period of
two years from the date we deposit the funds.
VOTING THE PREFERRED STOCK
Upon receipt of notice of any meeting at which the holders of preferred
stock are entitled to vote, the depositary will notify holders of depositary
shares of the upcoming vote and arrange to deliver our voting materials to the
holders. The record date for determining holders of depositary shares that are
entitled to vote will be the same as the record date for the preferred stock.
The materials the holders will receive will describe the matters to be voted on
and explain how the holders, on a certain date, may instruct the depositary to
vote the shares of preferred stock underlying the depositary shares. For
instructions to be valid, the depositary must receive them on or before the date
specified. To the extent possible, the depositary will vote the shares as
instructed by the holder. We agree to take all reasonable actions that the
depositary determines are necessary to enable it to vote as a holder as
instructed. The depositary will abstain from voting shares of preferred stock
deposited under a deposit agreement if it has not received specific instructions
from the holder of the depositary shares representing those shares.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
We may agree with the depositary to amend the deposit agreement and the
form of depositary receipt at any time. However, any amendment that materially
and adversely alters the rights of the holders of depositary receipts will not
be effective unless it has been approved by the holders of at least a
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majority of the affected depositary shares then outstanding. We will make no
amendment that impairs the right of any holder of depositary shares, as
described above under "-- Withdrawal of Preferred Stock", to receive shares of
preferred stock and any money or other property represented by those depositary
shares, except in order to comply with mandatory provisions of applicable law.
If an amendment becomes effective, holders are deemed to agree to the amendment
and to be bound by the amended deposit agreement if they continue to hold their
depositary receipts.
The deposit agreement automatically terminates if a final distribution
in respect of the preferred stock has been made to the holders of depositary
receipts in connection with our liquidation, dissolution or winding-up. We may
also terminate the deposit agreement at any time we wish with at least 60 days
prior written notice to the depositary. If we do so, the depositary will give
notice of termination to the record holders not less than 30 days before the
termination date. Once depositary receipts are surrendered to the depositary, it
will send to each holder the number of whole or fractional shares of the series
of preferred stock underlying that holder's depositary receipts.
CHARGES OF DEPOSITARY AND EXPENSES
We will pay all transfer and other taxes and governmental charges
arising solely from the existence of the depositary arrangements. We will pay
all charges of the depositary in connection with the initial deposit of the
related series of offered preferred stock, the initial issuance of the
depositary shares, all withdrawals of shares of the related series of offered
preferred stock by holders of the depositary shares and the registration of
transfers of title to any depositary shares. However, holders of depositary
receipts will pay other taxes and governmental charges and any other charges
provided in the deposit agreement to be payable by them.
LIMITATIONS ON OUR OBLIGATIONS AND LIABILITY TO HOLDERS OF DEPOSITARY RECEIPTS
The deposit agreement expressly limits our obligations and the
obligations of the depositary. It also limits our liability and the liability of
the depositary as follows:
- we and the depositary are only liable to the holders of
depositary receipts for negligence or willful misconduct; and
- we and the depositary have no obligation to become involved in
any legal or other proceeding related to the depositary
receipts or the deposit agreement on your behalf or on behalf
of any other party, unless you provide us with satisfactory
indemnity.
RESIGNATION AND REMOVAL OF DEPOSITARY
The depositary may resign at any time by notifying us of its election
to do so. In addition, we may remove the depositary at any time. Within 60 days
after the delivery of the notice of resignation or removal of the depositary, we
will appoint a successor depositary.
REPORTS TO HOLDERS
We will deliver all required reports and communications to holders of
the offered preferred stock to the depositary, and it will forward those reports
and communications to the holders of depositary shares.
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DESCRIPTION OF THE STOCK PURCHASE CONTRACTS
AND THE STOCK PURCHASE UNITS
We may issue stock purchase contracts, representing contracts
obligating holders to purchase from us, and obligating us to sell to the
holders, a specified number of shares of our common stock at a future date or
dates. The price per share and the number of shares of our common stock may be
fixed at the time the stock purchase contracts are issued or may be determined
by reference to a specific formula set forth in the stock purchase contracts.
The stock purchase contracts may be issued separately or as a part of stock
purchase units consisting of a stock purchase contract and, as security for the
holder's obligations to purchase the shares under the stock purchase contracts,
either:
- senior debt securities or subordinated debt securities;
- shares of preferred stock;
- preferred securities of American Financial Capital Trust II,
American Financial Capital Trust III or American Financial
Capital Trust IV; or
- debt obligations of third parties, including U.S. Treasury
securities.
The stock purchase contracts may require us to make periodic payments
to the holders thereof or vice versa, and such payments may be unsecured or
prefunded on some basis. The stock purchase contracts may require holders to
secure their obligations in a specified manner and, in certain circumstances, we
may deliver newly issued prepaid stock purchase contracts upon release to a
holder of any collateral securing such holder's obligations under the original
stock purchase contract.
The applicable prospectus supplement will describe the terms of any
stock purchase contracts or stock purchase units and, if applicable, prepaid
stock purchase contracts. The description in the prospectus supplement will not
purport to be complete and will be qualified in its entirety by reference to:
- the stock purchase contracts;
- the collateral arrangements and depositary arrangements, if
applicable, relating to such stock purchase contracts or stock
purchase units; and
- if applicable, the prepaid stock purchase contracts and the
document pursuant to which such prepaid stock purchase
contracts will be issued.
DESCRIPTION OF THE TRUST PREFERRED SECURITIES
GENERAL
The amended declarations of American Financial Capital Trust II,
American Financial Capital Trust III and American Financial Capital Trust IV
authorize each trust to issue one series of trust preferred securities and one
series of trust common securities, the terms of which will be described in a
prospectus supplement. The trusts will use the proceeds from the sale of the
trust preferred securities and trust common securities to purchase a series of
junior subordinated debt securities issued by us. The property trustee will hold
the junior subordinated debt securities in trust for the benefit of the holders
of the trust preferred securities. We, as sponsor of the trusts, will purchase
all of the common securities of each trust.
This section summarizes the general terms of the preferred securities
that the trusts may offer. The prospectus supplement relating to any particular
preferred securities offered by the trusts will describe the specific terms of
the trust preferred securities, which may be in addition to or different from
the general terms summarized in this section. The summary in this section and in
any prospectus
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supplement does not describe every aspect of the trust preferred securities
offered and is subject to and qualified in its entirety by reference to all the
provisions of the amended declaration and the trust preferred securities. The
forms of the amended declarations and the trust preferred securities are or will
be filed as exhibits to or incorporated by reference in the registration
statement.
We will guarantee the payments of distributions and payments on
redemption or liquidation with respect to the trust preferred securities, but
only to the extent the applicable trust has funds available to make those
payments and has not made the payments. The trust preferred securities guarantee
by us is described in more detail below under "Description of the Trust
Preferred Securities Guarantee."
The assets of each trust available for distribution to the holders of
its trust preferred securities will be limited to payments from us under the
series of junior subordinated debt securities held by such trust. If we fail to
make a payment on the junior subordinated debt securities, the trust will not
have sufficient funds to make related payments, including distributions, on
their respective trust preferred securities.
The trust preferred securities guarantee, when taken together with our
obligations under the series of junior subordinated debt securities, the junior
subordinated indenture and the amended declaration of trusts, will provide a
full and unconditional guarantee of amounts due on the trust preferred
securities issued by such trust.
The prospectus supplement relating to any particular trust preferred
securities will describe the specific terms of the trust preferred securities,
which may be in addition to or different from the general terms summarized in
this section. In particular, the prospectus supplement will describe:
- the name of the trust preferred securities;
- the designation of the trust preferred securities;
- the dollar amount and number of trust preferred securities
issued by such trust;
- the annual distribution rate(s) or method of determining such
rate(s), the payment date(s) and the record dates used to
determine the holders who are to receive distributions;
- the date(s) or the method to determine the date(s) from which
distributions shall be cumulative;
- the optional redemption provisions, if any, including the
prices, time periods and other terms and conditions for which
such trust preferred securities shall be purchased or
redeemed, in whole or in part;
- the optional right of the trust to defer quarterly
distributions on the preferred securities;
- the terms and conditions, if any, upon which the applicable
series of junior subordinated debt securities and the related
trust preferred securities guarantee may be distributed to
holders of the trust preferred securities upon liquidation,
dissolution, termination or winding up of the trust;
- any voting rights of the trust preferred securities other than
those described in this section;
- any securities exchange on which the trust preferred
securities will be listed;
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- whether the trust preferred securities are to be issued in
book-entry form and represented by one or more global
certificates, and if so, the depositary for the global
certificates and the specific terms of the depositary
arrangements;
- any other relevant rights, preferences, privileges,
limitations or restrictions of such trust preferred
securities; and
- any applicable United States Federal income tax
considerations.
LIQUIDATION DISTRIBUTION UPON DISSOLUTION
The amended declaration of each trust will state that such trust shall
be dissolved:
- on the expiration of the term of the trust;
- upon the bankruptcy, dissolution or liquidation of us;
- upon a change in law requiring the trust to register as an
investment company under the Investment Company Act of 1940;
- unless we take certain actions, upon a change in the law
resulting in the trust being subject to United States Federal
income tax on income received from the junior subordinated
debt securities held by the trust, the interest payable by us
on the junior subordinated debt securities not being
deductible for United State Federal income tax purposes, or
the trust being subject to more than a de minimus amount of
other taxes;
- upon the redemption, conversion or exchange of all of the
trust securities of the trust;
- upon the repayment of all of the junior subordinated debt
securities held by the trust or at the time that no such
junior subordinated debt securities are outstanding;
- upon entry of a court order for the dissolution of the trust;
or
- upon our election to terminate the trust and distribute the
related junior subordinated debt securities directly to the
holders of the trust securities.
Upon dissolution, after the applicable trust pays all amounts owed to
creditors, the holders of the trust securities will be entitled to receive:
- cash equal to the aggregate liquidation amount of each trust
security specified in an accompanying prospectus supplement,
plus accumulated and unpaid distributions to the date of
payment; or
- junior subordinated debt securities in an aggregate principal
amount equal to the aggregate liquidation amount of the trust
securities.
If the trust cannot pay the full amount due on its trust securities
because insufficient assets are available for payment, then the amounts payable
by the trust on its trust securities shall be paid pro rata. However, if an
event of default under the related indenture has occurred, the total amounts due
on the trust preferred securities will be paid before any distribution on the
trust common securities.
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EVENTS OF DEFAULT
An event of default under the junior subordinated indenture relating to
a series of junior subordinated debt securities is an event of default under the
amended declaration of the trust. We have described these events of default
under the sections entitled "Description of Debt Securities -- Provisions
Applicable to All Debt Securities -- Events of Default" and " -- Provisions
Applicable to Junior Subordinated Debt Securities Events of Default".
We and the regular trustees of each trust must file annually with the
property trustee for each trust a certificate stating whether or not they are in
compliance with all the applicable conditions and covenants under the related
amended declaration.
Upon the occurrence of an event of default, the property trustee of the
trust, as the sole holder of the junior subordinated debt securities held by the
trust, will have the right under the junior subordinated indenture to declare
the principal of, premium, if any, and interest on such junior subordinated debt
securities to be immediately due and payable.
If a property trustee fails to enforce its rights under the amended
declaration or the junior subordinated indenture then, to the fullest extent
permitted by law, and subject to the terms of the amended declaration and the
junior subordinated indenture, any holder of trust preferred securities may sue
us, or seek other remedies, to enforce the property trustee's rights under the
amended declaration or the junior subordinated indenture without first
instituting a legal proceeding against such property trustee or any other
person.
If we fail to pay principal, premium, if any, or interest on a series
of junior subordinated debt securities when payable, then a holder of such trust
preferred securities may directly sue us or seek other remedies, to collect its
pro rata share of payments owned.
REMOVAL AND REPLACEMENT OF TRUSTEES
Only the holders of trust common securities may remove or replace the
trustees of any trust. The resignation or removal of any trustee and the
appointment of a successor trustee will be effective only on the acceptance of
appointment by the successor trustee in accordance with the provisions of the
amended declaration for the trust.
MERGERS, CONSOLIDATIONS, CONVERSIONS OR AMALGAMATIONS OF THE TRUSTS
No trust may consolidate, amalgamate, merge with or into, or be
converted into or replaced by or convey, transfer or lease their properties and
assets substantially as an entirety to any other corporation or other body,
except as described below. Each trust may, with the consent of a majority of its
regular trustees and without the consent of the holders of its trust securities
or the other trustees, engage in any of the merger events referred to above
under the conditions set forth in the amended declaration and described in a
prospectus supplement.
In addition, unless all of the holders of the trust preferred
securities and trust common securities approve otherwise, a trust may not
consent to or engage in a merger event if that event would cause the trust or
the successor entity to be classified other than as a grantor trust for United
States federal income tax purposes.
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INFORMATION CONCERNING DUTIES OF THE PROPERTY TRUSTEE
For matters relating to compliance with the Trust Indenture Act, the
property trustee of each trust will have all of the duties and responsibilities
of an indenture trustee under the Trust Indenture Act. The property trustee
undertakes to perform only such duties as are specifically set forth in the
amended declaration and, upon an event of default, must use the same degree of
care and skill as a prudent person would exercise or use in the conduct of his
or her own affairs. Subject to this provision, the property trustee is under no
obligation to exercise any of the powers given it by the applicable amended
declaration at the request of any holder of trust preferred securities unless it
is offered reasonable security or indemnity against the costs, expenses and
liabilities that it might incur. However, the holders of the trust preferred
securities will not be required to offer such an indemnity where the holders, by
exercising their voting rights, direct the property trustee to take any action
following an event of default under the junior subordinated indenture.
MISCELLANEOUS
The regular trustees of each trust are authorized and directed to
conduct the affairs of each trust and to operate each trust in such a way that:
- it will not be deemed to be an "investment company" required
to be registered under the Investment Company Act;
- it will be classified as a grantor trust for United States
federal income tax purposes; and
- the junior subordinated debt securities held by it will be
treated as indebtedness of us for United States federal income
tax purposes.
We and the regular trustees of each trust are authorized to take any
action (so long as it is consistent with applicable law or the applicable
certificate of trust or amended declaration) that we and the regular trustees of
the trust determine to be necessary or desirable for such purposes.
Holders of trust preferred securities have no preemptive or similar
rights.
No trust may borrow money, issue debt, execute mortgages or pledge any
of its assets.
GOVERNING LAW
The amended declaration and the related trust preferred securities will
be governed by and construed in accordance with the laws of the State of
Delaware and the Trust Indenture Act.
DESCRIPTION OF THE TRUST PREFERRED SECURITIES GUARANTEE
GENERAL
We will execute a trust preferred securities guarantee, which benefits
the holders of trust preferred securities, at the time that the trust issues the
trust preferred securities. The trust preferred securities guarantee will be
qualified as an indenture under the Trust Indenture Act and will be held for the
benefit of holders of trust preferred securities by a guarantee trustee meeting
the requirements of the Trust Indenture Act. Unless otherwise indicated in a
prospectus supplement, Bank of New York (Delaware) will be the guarantee
trustee.
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GUARANTEE PAYMENT
This section summarizes the general terms of the guarantees that we
will provide in respect of the preferred securities that the trusts may offer.
The summary in this section does not describe every aspect of the guarantee and
is subject to and qualified in its entirety by reference to the description in
the related prospectus supplement and to all the provisions of the guarantee
agreements. The form of the guarantee agreement is filed as an exhibit to the
registration statement.
We will irrevocably agree, as described in the trust preferred
securities guarantee, to pay in full, to the holders of the trust preferred
securities issued by the trusts, the following trust preferred securities
guarantee payments when due to the extent not paid by the trusts, regardless of
any defense, right of set-off or counterclaim which the trusts may have or
assert:
- any accrued and unpaid distributions required to be paid on
the trust preferred securities, to the extent that the trust
has funds available to make the payment;
- the redemption price, to the extent that the trust has funds
available to make the payment; and
- upon a voluntary or involuntary dissolution and liquidation of
the trust (other than in connection with a distribution of
junior subordinated debt securities to holders of such trust
preferred securities or the redemption of all such trust
preferred securities), the lesser of
(1) the aggregate of the liquidation amount specified in
the prospectus supplement for each trust preferred security plus all
accrued and unpaid distributions on the trust preferred securities to
the date of payment, to the extent the trust has funds available to
make the payment and
(2) the amount of assets of the trust remaining available
for distribution to holders of its trust preferred securities upon a
dissolution and liquidation of the trust.
Our obligation to make a trust preferred securities guarantee payment
may be satisfied by directly paying the required amounts to the holders of the
trust preferred securities or by causing the trust to pay the amounts to the
holders.
The combined operation of our obligations under the junior subordinated
indenture and the trust preferred securities guarantee and amended declaration
has the effect of providing a full, irrevocable and unconditional guarantee of
the trust's obligations under its trust preferred securities.
STATUS OF THE TRUST PREFERRED SECURITIES GUARANTEE
The trust preferred securities guarantee will constitute an unsecured
obligation of us and will rank:
- subordinated and junior in right of payment to all our other
liabilities except those liabilities made equal or subordinate
to the guarantee by their terms; and
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- senior to the following:
(1) all capital stock (other than the most senior
preferred shares issued, from time to time, by us, which will rank
equally with the guarantee) issued by us; and
(2) any guarantee entered into by us relating to its
capital stock (other than the most senior preferred shares issued, from
time to time, by us).
The trust preferred securities guarantee will rank equally with
obligations under other guarantee agreements that we may enter into from time to
time if both:
- the agreements are in substantially the form of the preferred
securities guarantee and provide for comparable guarantees by
us of payment on preferred securities issued by our other
trusts or financing vehicles; and
- the debt relating to those preferred securities are our
subordinated, unsecured indebtedness.
By acceptance of the trust preferred securities, holders accept the
subordination provisions and other terms of the trust preferred securities
guarantee. The trust preferred securities guarantee will constitute a guarantee
of payment and not of collection. In other words, the holder of the guaranteed
security may sue us, or seek other remedies, to enforce its rights under the
trust preferred securities guarantee without first suing any other person or
entity. The trust preferred securities guarantee will not be discharged except
by payment of the guarantee payments in full to the extent not previously paid
or upon distribution of the corresponding series of junior subordinated debt
securities to the holders of trust preferred securities pursuant to the amended
declaration.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes which do not adversely affect the
rights of holders of trust preferred securities in any material respect (in
which case no consent of such holders will be required), a trust preferred
securities guarantee may only be amended with the prior approval of the holders
of a majority in aggregate liquidation amount of such trust preferred
securities. All guarantees and agreements contained in the trust preferred
securities guarantee will be binding on our successors, assigns, receivers,
trustees and representatives and are for the benefit of the holders of the
applicable trust preferred securities.
TRUST PREFERRED SECURITIES GUARANTEE EVENTS OF DEFAULT
An event of default under the trust preferred securities guarantee
occurs if we fail to make any of our required payments or perform its
obligations under the trust preferred securities guarantee.
The holders of at least a majority in aggregate liquidation amount of
the trust preferred securities will have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the guarantee
trustee or to direct the exercise of any trust or power given to the guarantee
trustee under the trust preferred securities guarantee.
INFORMATION CONCERNING DUTIES OF THE TRUST PREFERRED GUARANTEE TRUSTEE
The guarantee trustee under the trust preferred securities guarantee,
other than during the occurrence and continuance of an event of default under
the trust preferred securities guarantee, will only
26
perform the duties that are specifically described in the trust preferred
securities guarantee. After such a default, the trust preferred guarantee
trustee will exercise the same degree of care and skill as a prudent person
would exercise or use in the conduct of his or her own affairs. Subject to this
provision, the guarantee trustee is under no obligation to exercise any of its
powers as described in the trust preferred securities guarantee at the request
of any holder of covered trust preferred securities unless it is offered
reasonable indemnity against the costs, expenses and liabilities that it might
incur.
TERMINATION OF THE TRUST PREFERRED SECURITIES GUARANTEE
The trust preferred securities guarantee will terminate once the trust
preferred securities are paid in full or upon distribution of the corresponding
series of junior subordinated debt securities to the holders of the trust
preferred securities. The trust preferred securities guarantee will continue to
be effective or will be reinstated if at any time any holder of trust preferred
securities must restore payment of any sums paid under such trust preferred
securities or such trust preferred securities guarantee.
GOVERNING LAW
The trust preferred securities guarantee will be governed by and
construed in accordance with the laws of the State of Ohio and the Trust
Indenture Act.
RELATIONSHIP AMONG THE TRUST PREFERRED SECURITIES,
THE TRUST PREFERRED SECURITIES GUARANTEE AND THE
JUNIOR SUBORDINATED DEBT SECURITIES HELD BY THE TRUST
Payments of distributions and redemption and liquidation payments due
on the trust preferred securities, to the extent the trust has funds available
for the payments, will be guaranteed by us to the extent described above under
"Description of the Trust Preferred Securities Guarantee." The combined
operation of our obligations under the trust preferred securities guarantee,
amended declaration and the junior subordinated indenture has the effect of
providing a full, irrevocable and unconditional guarantee of the trust's
obligations under its trust preferred securities.
As long as we make payments of interest and other payments when due on
the junior subordinated debt securities held by the trust, the payments will be
sufficient to cover the payment of distributions and redemption and liquidation
payments due on the trust preferred securities issued by the trust because:
- the aggregate principal amount of the junior subordinated debt
securities will be equal to the sum of the aggregate
liquidation amount of the trust securities;
- the interest rate and interest and other payment dates on the
junior subordinated debt securities will match the
distribution rate and distribution and other payment dates for
the trust preferred securities;
- we will pay for any and all costs, expenses and liabilities of
the trust except the trust's obligations under its trust
preferred securities; and
- the amended declaration provides that the trust will not
engage in any activity that is not consistent with the limited
purposes of the trust.
If and to the extent that we do not make payments on the junior
subordinated debt securities, the trust will not have funds available to make
payments of distributions or other amounts due on its trust
27
preferred securities. In those circumstances, you will not be able to rely upon
the trust preferred securities guarantee for payment of these amounts. Instead,
you may directly sue us or seek other remedies to collect your pro rata share of
payments owed. If you sue us to collect payment, then we will assume your rights
as a holder of trust preferred securities under the amended declaration to the
extent we make a payment to you in any such legal action.
A holder of any trust preferred security may sue us, or seek other remedies, to
enforce its rights under the trust preferred securities guarantee without first
suing the guarantee trustee, the trust or any other person or entity.
PLAN OF DISTRIBUTION
We and each trust may sell the securities through underwriters or
dealers, directly to one or more purchasers, through agents, through remarketing
firms, through direct sales or auctions performed by using the internet or a
bidding or ordering system, or through a combination of these methods. The
prospectus supplement will include the names of underwriters, dealers, agents or
remarketing firms that we retain. The prospectus supplement also will include
the purchase price of the securities, our and each trust's proceeds from the
sale, any underwriting discounts or commissions and other items constituting
underwriters' compensation, and any securities exchanges on which the securities
may be listed.
Because the National Association of Securities Dealers, Inc. ("NASD")
views securities such as the preferred securities as interest in a direct
participation program, any offering of preferred securities by any trust will be
made in compliance with Rule 2810 of the NASD's Conduct Rules.
In some cases, we and the trusts may also repurchase the securities and
reoffer them to the public by one or more of the methods described above. This
prospectus may be used in connection with any offering of securities through any
of these methods or other methods described in the applicable prospectus
supplement.
The securities we and the trusts distribute by any of these methods may
be sold to the public, in one or more transactions, either:
- at a fixed price or prices, which may be changed;
- at market prices prevailing at the time of sale;
- at prices related to prevailing market prices; or
- at negotiated prices.
We and the trusts may solicit offers to purchase securities directly
from the public from time to time. We and the trusts may also designate agents
from time to time to solicit offers to purchase securities from the public on
our or the trusts' behalf. The prospectus supplement relating to any particular
offering of securities will name any agents designated to solicit offers, and
will include information about any commissions we or the trusts may pay the
agents, in that offering. Agents may be deemed to be "underwriters" as that term
is defined in the Securities Act.
In connection with the sale of securities, underwriters may receive
compensation from us or the trusts or from purchasers of the securities, for
whom they may act as agents, in the form of discounts, concessions or
commissions. Underwriters may sell the securities to or through dealers, and
such dealers may receive compensation in the form of discounts, concessions or
commissions from the underwriters
28
and/or commissions from the purchasers for whom they may act as agents.
Underwriters, dealers and agents that participate in the distribution of the
securities may be deemed to be underwriters, and any discounts or commissions
they receive from us or the trusts, and any profit on the resale of the
securities they realize may be deemed to be underwriting discounts and
commissions under the Securities Act. Any such underwriter, dealer or agent will
be identified, and any such compensation received will be described, in the
applicable prospectus supplement.
Unless otherwise specified in the related prospectus supplement, each
series of the securities will be a new issue with no established trading market,
other than the common stock. Any common stock sold pursuant to a prospectus
supplement will be listed on the NYSE, subject to official notice of issuance.
We and the trusts may elect to list any of the other securities on an exchange,
but are not obligated to do so. It is possible that one or more underwriters may
make a market in a series of the securities, but will not be obligated to do so
and may discontinue any market making at any time without notice. Therefore, no
assurance can be given as to the liquidity of the trading market for the
securities.
If dealers are utilized in the sale of the securities, we and the
trusts will sell the securities to the dealers as principals. The dealers may
then resell the securities to the public at varying prices to be determined by
such dealers at the time of resale. The names of the dealers and the terms of
the transaction will be set forth in the applicable prospectus supplement.
We and the trusts may enter into agreements with underwriters, dealers
and agents who participate in the distribution of the securities which may
entitle these persons to indemnification by us and the trusts against certain
liabilities, including liabilities under the Securities Act, or to contribution
with respect to payments which such underwriters, dealers or agents may be
required to make in respect thereof. Any agreement in which we or the trusts
agree to indemnify underwriters, dealers and agents against civil liabilities
will be described in the applicable prospectus supplement.
In connection with an offering, the underwriters may purchase and sell
securities in the open market. These transactions may include short sales,
stabilizing transactions and purchases to cover positions created by short
sales. Short sales involve the sale by the underwriters of a greater number of
securities than they are required to purchase in an offering. Stabilizing
transactions consist of certain bids or purchases made for the purpose of
preventing or retarding a decline in the market price of the securities while an
offering is in progress.
The underwriters also may impose a penalty bid. This occurs when a
particular underwriter repays to the underwriters a portion of the underwriting
discount received by it because the underwriters have repurchased securities
sold by or for the account of that underwriter in stabilizing or short-covering
transactions.
These activities by the underwriters may stabilize, maintain or
otherwise affect the market price of the securities. As a result, the price of
the securities may be higher than the price that otherwise might exist in the
open market. If these activities are commenced, they may be discontinued by the
underwriters at any time. These transactions may be effected on an exchange or
automated quotation system, if the securities are listed on that exchange or
admitted for trading on that automated quotation system, or in the
over-the-counter market or otherwise.
We have not authorized any dealer, salesperson or other person to give
any information or represent anything not contained in this prospectus. You must
not rely on any unauthorized information. This prospectus does not offer to sell
or buy any securities in any jurisdiction where it is unlawful.
29
Underwriters, dealers and agents may engage in transactions with or
perform services for us or the trusts, or be customers of ours or the trusts, in
the ordinary course of business.
LEGAL MATTERS
The validity of the securities offered hereby other than the preferred
securities will be passed upon for us and each trust by Keating, Muething &
Klekamp, P.L.L., Cincinnati, Ohio. Certain matters of Delaware law relating to
the validity of the preferred securities will be passed upon for the Trust by
Morris, Nichols, Arsht & Tunnell, Wilmington, Delaware.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements and schedules included in our Annual Report on Form 10-K
for the year ended December 31, 2002, as set forth in their report, which is
incorporated by reference in this prospectus and elsewhere in the registration
statement. Our financial statements and schedules are incorporated by reference
in reliance on Ernst & Young LLP's report, given on their authority as experts
in accounting and auditing.
30
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the expenses in connection with the
offering described in this Registration Statement:
Securities and Exchange Commission registration fee* $ 21,358
Legal fees and expenses $ 50,000
Accounting fees and expenses $ 4,000
Printing and engraving expenses $ 50,000
Miscellaneous $174,642
--------
Total $300,000
========
------------------------
* Actual; other expenses are estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Ohio Revised Code, Section 1701.13(E), allows indemnification by us to
any person made or threatened to be made a party to any proceedings, other than
a proceeding by or in the right of us, by reason of the fact that he is or was a
director, officer, employee or agent of ours, against expenses, including
judgment and fines, if he acted in good faith and in a manner reasonably
believed to be in or not opposed to our best interests and, with respect to
criminal actions, in which he had no reasonable cause to believe that his
conduct was unlawful. Similar provisions apply to actions brought by or in the
right of us, except that no indemnification shall be made in such cases when the
person shall have been adjudged to be liable for negligence or misconduct to us
unless deemed otherwise by the court. Indemnifications are to be made by a
majority vote of a quorum of disinterested directors or the written opinion of
independent counsel or by the shareholders or by the court. Our Code of
Regulations extends such indemnification.
We maintain, at our expense, Directors and Officers Liability and
Company Reimbursement Liability Insurance. The Directors and Officers Liability
portion of such policy covers all of our directors and officers and of the
companies which are, directly or indirectly, more than 50% owned by us. The
policy provides for payment on behalf of the directors and officers, up to the
policy limits and after expenditure of a specified deductible, of all Loss (as
defined) from claims made against them during the policy period for defined
wrongful acts, which include errors, misstatements or misleading statements,
acts or omissions and neglect or breach of duty by directors and officers in the
discharge of their individual or collective duties as such. The insurance
includes the cost of investigations and defenses, appeals and bonds and
settlements and judgments, but not fines or penalties imposed by law. The
insurance does not cover any claims arising out of acts alleged to have been
committed prior to October 24, 1978. The insurer limit of liability under the
policy is $175,000,000 in the aggregate for all losses each year subject to
certain individual and aggregate deductibles. The policy contains various
exclusions and reporting requirements.
We also have entered into indemnification agreements with our executive
officers and directors providing for indemnification against certain liabilities
to the fullest extent permitted under Ohio law.
The Declarations will provide that no Property Trustee or any of its
Affiliates, Delaware Trustee or any of its Affiliates, or any officer, director,
shareholder, member, partner, employee, representative, custodian, nominee or
agent of the Property Trustee or the Delaware Trustee (each a "Fiduciary
Indemnified Person"), and no Regular Trustee, Affiliate of any Regular Trustee,
or any officer, director, shareholder, member, partner, employee, representative
or agent of any regular Trustee or any Affiliate thereof, or any employee or
agent of the trust or its Affiliates (each a "Company Indemnified Person") shall
be liable, responsible or accountable in damages or otherwise to the trust or
any officer, director, shareholder, partner, member, representative, employee or
agent of the trust or its Affiliates or to any holder of Preferred Securities
for any loss, damage or claim incurred by reason of any act or omission
performed or omitted by such Fiduciary Indemnified Person or Company Indemnified
Person in good faith on behalf of the trust and in a manner such Fiduciary
Indemnified Person or Company Indemnified Person reasonably believed to be
within the scope of the authority conferred on such Fiduciary Indemnified Person
or Company Indemnified Person by such Declaration or by law, except that a
Fiduciary Indemnified Person or Company Indemnified Person shall be liable for
any such loss, damage or claim incurred by reason of such Fiduciary Indemnified
Person's or Company Indemnified Person's gross negligence or willful misconduct
with respect to such acts or omissions.
The Amended and Restated Declaration of the Trusts (the "Declarations")
will also provide that to the full extent permitted by law, we shall indemnify
any Company Indemnified Person who was or is a party or is threatened to be made
a party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or in the right of the trust) by reason of the fact that he is or was a
Company Indemnified Person against expense (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by him in connection with such action, suit or proceeding if he acted in good
faith and in a manner he reasonably believed to be in or not opposed to the best
interest of the trusts, and, with respect to any criminal action or proceeding,
had no reasonable cause to believe his conduct was unlawful. The Declarations
will also provide that to the full extent permitted by law, we shall indemnify
any Company Indemnified Person who was or is a party or is threatened to be made
a party to any threatened, pending or completed action or suit by or in the
right of the trust to procure a judgment in its favor by reason of the fact that
he is or was a Company Indemnified Person against expenses (including attorneys'
fees) actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the trust
and except that no such indemnification shall be made in respect of any claim,
issue or manner as to which such Company Indemnified Person shall have been
adjudged to be liable to the trust unless and only to the extent that the Court
of Chancery of Delaware or the court in which such action or suit was brought
shall determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which Court of Chancery or
such other court shall deem proper. The Declarations will further provide that
expenses (including attorneys' fees) incurred by a Company Indemnified Person in
defending a civil, criminal, administrative or investigative action, suit or
proceeding referred to in the immediately preceding two sentences shall be paid
by us in advance of the final disposition of such action, suit or proceeding
upon receipt of an undertaking by or on behalf of such Company Indemnified
Person to repay such amount if it shall ultimately be determined that he is not
entitled to be indemnified by us as authorized in the Declarations.
Our directors and officers and the Regular Trustees are covered by
insurance policies indemnifying them against certain liabilities, including
certain liabilities arising under the Securities Act of 1933 which might be
incurred by them in such capacities and against which they cannot be indemnified
by us or the trusts. Any agents, dealers or underwriters who execute any of the
agreements filed as or incorporated by reference as Exhibit 1 to this
Registration Statement will agree to indemnify our directors and their officers
and the Trustees who signed the Registration Statement against certain
II-2
liabilities that may arise under the Securities Act of 1933 with respect to
information furnished to us or the trust by or on behalf of any such
indemnifying party.
The Declarations will also provide that we shall indemnify each
Fiduciary Indemnified Person against any loss, liability or expense incurred
with out negligence or bad faith on its part, arising out of or in connection
with the acceptance or administration of the trust, including the costs and
expenses (including reasonable legal fees and expenses) of defending itself
against or investigating any claim or liability in connection with the exercise
or performance of any of its powers or duties thereunder.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
Exhibit No. Description Of Document
----------- ------------------------------------------------------------
1* Form of Underwriting Agreement
4.1** Amended and Restated Articles of Incorporation of American
Financial Group, Inc. (incorporated by reference to Exhibit
3(a) of American Financial Group, Inc.'s Annual Report on
Form 10-K for 1997)
4.2** Code of Regulations of American Financial Group, Inc.
(incorporated by reference to Exhibit 3(b) of American
Financial Group, Inc.'s Annual Report on Form 10-K for 1997)
4.3** Form of Senior Indenture (incorporated by reference to
Exhibit 4.3 to the Registrants' Registration Statement on
Form S-3, Registration No. 333-21995)
4.4** Form of Junior Subordinated Indenture (incorporated by
reference to Exhibit 4.4 to the Registrants' Registration
Statement on Form S-3, Registration No. 333-21995)
4.5** Form of Subordinated Indenture (incorporated by reference to
Exhibit 4.5 to the Registrants' Registration Statement on
Form S-3, Registration No. 333-81903)
4.6* Form of Preferred Securities Guarantee Agreement by American
Financial Group, Inc. with respect to American Financial
Capital Trust II
4.7* Form of Preferred Securities Guarantee Agreement by American
Financial Group, Inc. with respect to American Financial
Capital Trust III
4.8* Form of Preferred Securities Guarantee Agreement by American
Financial Group, Inc. with respect to American Financial
Capital Trust IV
4.9* Form of Debt Security
4.10* Form of Preferred Security
4.11** Certificate of Trust of American Financial Capital Trust II
(incorporated by reference to Exhibit 4.9 to the
Registrants' Registration Statement on Form S-3,
Registration No. 333-81903)
4.12 Certificate of Trust of American Financial Capital Trust III
4.13 Certificate of Trust of American Financial Capital Trust IV
4.14** Declaration of Trust of American Financial Capital Trust II
(incorporated by reference to Exhibit 4.10 to the
Registrants' Registration Statement on Form S-3,
Registration No. 333-81903)
4.15 Declaration of Trust of American Financial Capital Trust III
4.16 Declaration of Trust of American Financial Capital Trust IV
4.17* Form of Deposit Agreement
4.18* Form of Depositary Receipt
4.19* Form of Warrant Agreement
4.20* Form of Amended and restated Declaration of Trust of
American Financial Capital Trust II
4.21* Form of Amended and restated Declaration of Trust of
American Financial Capital Trust III
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4.22* Form of Amended and restated Declaration of Trust of
American Financial Capital Trust IV
5.1 Opinion of Keating, Muething & Klekamp, P.L.L.
5.2 Opinion of Morris, Nichols, Arsht & Tunnell
8* Opinion of tax counsel.
12 Statement Regarding Computation of Earnings to Fixed Charges
23.1 Consent of Independent Auditors
23.2 Consent of Keating, Muething & Klekamp, P.L.L. (contained in
Exhibit 5.1)
23.3 Consent of Morris, Nichols, Arsht & Tunnell (contained in
Exhibit 5.2)
24 Powers of Attorney (contained on the signature pages)
25.1** Statement of Eligibility on Form T-1 under the Trust
Indenture Act of 1939, as amended, of U.S. Bank National
Association (formerly known as Firstar Bank, N.A.), as
Trustee under the Senior Indenture (incorporated by
reference to Exhibit 25.1 of the Registrants' Registration
Statement on Form S-3, Registration No. 333-21995)
25.2** Statement of Eligibility on Form T-1 under the Trust
Indenture Act of 1939, as amended, of Bank of New York, as
Trustee under the Junior Subordinated Indenture
(incorporated by reference to Exhibit 25.2 of the
Registrants' Registration Statement on Form S-3,
Registration No. 333-21995)
25.3** Statement of Eligibility on Form T-1 under the Trust
Indenture Act of 1939, as amended, of Bank of New York, as
Trustee under the Declaration of American Financial Capital
Trust II (incorporated by reference to Exhibit 25.3 of the
Registrants' Registration Statement on Form S-3,
Registration No. 333-21995)
25.4** Statement of Eligibility on Form T-1 under the Trust
Indenture Act of 1939, as amended, of Bank of New York, as
Trustee of the Trust Preferred Securities Guarantee for the
benefit of the holders of Preferred Securities of American
Financial Capital Trust II (incorporated by reference to
Exhibit 25.4 of the Registrants' Registration Statement on
Form S-3, Registration No. 333-21995)
25.5** Statement of Eligibility on Form T-1 under the Trust
Indenture Act of 1939, as amended, of U.S. Bank National
Association (formerly known as Firstar Bank, N.A.), as
Trustee under the Subordinated Indenture (incorporated by
reference to Exhibit 25.5 to the Registrants' Registration
Statement on Form S-3, Registration No. 333-81903)
---------------
*To be filed as an exhibit to a Current Report on Form 8-K.
**Incorporated by reference from other documents filed with the Commission as
indicated.
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrants hereby undertake:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of the Registration
Statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the
Registration Statement. Notwithstanding the foregoing, any
II-4
increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected
in the form of prospectus filed with the Commission pursuant
to Rule 424(b) under the Securities Act if, in the aggregate,
the changes in volume and price represent no more than a 20%
change in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the effective
Registration Statement.
(iii) To include any material information with
respect to the plan of distribution not previously disclosed
in the Registration Statement or any material change to such
information in the Registration Statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) above do not apply
if the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the registrants
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) The undersigned registrants hereby undertake that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrants' annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 that is incorporated by reference
in the Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) If the securities to be registered are to be offered at
competitive bidding, the undersigned registrants hereby undertake: (1) to use
their best efforts to distribute prior to the opening of bids, to prospective
bidders, underwriters, and dealers, a reasonable number of copies of a
prospectus which at that time meets the requirements of Section 10(a) of the
Act, and relating to the securities offered at competitive bidding, as contained
in the Registration Statement, together with any supplements thereto, and (2) to
file an amendment to the Registration Statement reflecting the results of
bidding, the terms of the reoffering and related matters to the extent required
by the applicable form, not later than the first use, authorized by the issuer
after the opening of bids, of a prospectus relating to the securities offered at
competitive bidding, unless no further public offering of such securities by the
issuer and no reoffering of such securities by the purchasers is proposed to be
made.
(d) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrants pursuant to the foregoing provisions, or otherwise,
the registrants have been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrants of expenses incurred or paid by a director, officer or controlling
person of the registrants 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, the registrants will, unless
II-5
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
(e) The undersigned registrants hereby undertakes that
(1) for purposes of determining any liability under the
Securities Act of 1933, the information omitted from the form of
prospectus filed as part of this Registration Statement in reliance
upon Rule 430A and contained in a form of prospectus filed by the
registrants pursuant to Rule 424(b)(1) or (4) or 497(h) under the
Securities Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective; and
(2) for the purpose of determining any liability under
the Securities Act of 1933, each post-effective amendment that contains
a form of prospectus shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
(f) The undersigned registrants hereby undertake to file, if
necessary, an application for the purpose of determining the eligibility of the
Trustee to act under subsection (a) of Section 310 of the Trust Indenture Act of
1939 in accordance with the rules and regulations prescribed by the Securities
and Exchange Commission under Section 305(b)(2) of such Act.
II-6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, American
Financial Group, Inc. 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
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized in the City of Cincinnati, State of Ohio, as of the 30th day of
June, 2003.
AMERICAN FINANCIAL GROUP, INC.
By: /s/ Carl H. Lindner
-----------------------------
Carl H. Lindner
Chairman of the Board
(Principal Executive Officer)
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated. Each person below whose signature is
preceded by an (*) hereby constitutes and appoints Fred J. Runk and James C.
Kennedy, or either of them, his true and lawful attorney and agent, to sign all
amendments to this Registration Statement as well as any related registration
statement (or amendment thereto) filed pursuant to Rule 462(b) promulgated under
the Securities Act of 1933.
SIGNATURE CAPACITY DATE
/s/ Carl H. Lindner Chairman of the Board of Directors June 30, 2003
------------------------------------ (Principal Executive Officer)
*Carl H. Lindner
/s/ Carl H. Lindner III Director June 30, 2003
------------------------------------
*Carl H. Lindner III
/s/ S. Craig Lindner Director June 30, 2003
------------------------------------
*S. Craig Lindner
/s/ James E. Evans Director June 30, 2003
------------------------------------
*James E. Evans
/s/ Theodore H. Emmerich Director June 30, 2003
------------------------------------
*Theodore H. Emmerich
/s/ Terry S. Jacobs Director June 30, 2003
------------------------------------
*Terry S. Jacobs
/s/ William R. Martin Director June 30, 2003
------------------------------------
*William R. Martin
II-7
/s/ William A. Shuzer Director June 30, 2003
----------------------------------
*William A. Shuzer
/s/ William W. Verity Director June 30, 2003
----------------------------------
*William W. Verity
/s/ Fred J. Runk Senior Vice President and Treasurer June 30, 2003
---------------------------------- (Principal Financial and Accounting
Fred J. Runk Officer)
II-8
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, American
Financial Capital Trust II 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 Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized in the City of Cincinnati, State of Ohio, as of June
30, 2003.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated. Each person below whose signature is
preceded by an (*) hereby constitutes and appoints Fred J. Runk and Karl J.
Grafe, or either of them, his true and lawful attorney and agent, to sign all
amendments to this Registration Statement as well as any related registration
statement (or amendment thereto) filed pursuant to Rule 462(b) promulgated under
the Securities Act of 1933.
AMERICAN FINANCIAL CAPITAL TRUST II
By:* /s/ James C. Kennedy
---------------------------------
James C. Kennedy, as Trustee
By:* /s/ Thomas E. Mischell
---------------------------------
Thomas E. Mischell, as Trustee
II-9
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, American
Financial Capital Trust III 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 Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized in the City of Cincinnati, State of Ohio, as of June
30, 2003.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated. Each person below whose signature is
preceded by an (*) hereby constitutes and appoints Fred J. Runk and Karl J.
Grafe, or either of them, his true and lawful attorney and agent, to sign all
amendments to this Registration Statement as well as any related registration
statement (or amendment thereto) filed pursuant to Rule 462(b) promulgated under
the Securities Act of 1933.
AMERICAN FINANCIAL CAPITAL TRUST III
By:* /s/ James C. Kennedy
---------------------------------
James C. Kennedy, as Trustee
By:* /s/ Thomas E. Mischell
---------------------------------
Thomas E. Mischell, as Trustee
II-10
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, American
Financial Capital Trust IV 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 Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized in the City of Cincinnati, State of Ohio, as of June
30, 2003.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated. Each person below whose signature is
preceded by an (*) hereby constitutes and appoints Fred J. Runk and James C.
Kennedy, or either of them, his true and lawful attorney and agent, to sign all
amendments to this Registration Statement as well as any related registration
statement (or amendment thereto) filed pursuant to Rule 462(b) promulgated under
the Securities Act of 1933.
AMERICAN FINANCIAL CAPITAL TRUST IV
By:* /s/ James C. Kennedy
---------------------------------
James C. Kennedy, as Trustee
By:* /s/ Thomas E. Mischell
---------------------------------
Thomas E. Mischell, as Trustee
II-11