EXHIBIT 99.3
October __, 1997
EXCHANGE AGENT AGREEMENT
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
SAFECO Capital Trust I, a statutory business trust formed under the laws of
the state of Delaware (the "Trust"), proposes to make an offer (the "Exchange
Offer") to exchange up to $850,000,000 aggregate liquidation amount of its
8.072% Capital Securities (Liquidation Amount $1,000 per Capital Security) fully
and unconditionally guaranteed by SAFECO Corporation (the "Company") (the
"Exchange Capital Securities"), which have been registered under the Securities
Act of 1933, as amended (the "Securities Act"), for a like liquidation amount of
its outstanding 8.072% Capital Securities (Liquidation Amount $1,000 per Capital
Security) (the Original Capital Securities"), of which $850,000,000 aggregate
liquidation amount is outstanding. The terms and conditions of the Exchange
Offer as currently contemplated are set forth in a Prospectus (the
"Prospectus"), distributed to record holders of the Original Capital Securities
on October __, 1997. The Original Capital Securities and the Exchange Capital
Securities are collectively referred to herein as the "Capital Securities."
Capitalized terms used herein and not otherwise defined shall have the meanings
assigned to them in the Prospectus.
The Trust hereby appoints The Chase Manhattan Bank to act as exchange agent
(the "Exchange Agent") in connection with the Exchange Offer. References
hereinafter to "you" shall refer to The Chase Manhattan Bank.
The Exchange Offer is expected to be commenced by the Trust on or about
October __, 1997. The Letter of Transmittal accompanying the Prospectus is to
be used by the holders of the Original Capital Securities to accept the Exchange
Offer and contains certain instructions with respect to (i) the delivery of
certificates for Original Capital Securities tendered in connection therewith
and (ii) the book entry transfer of Capital Securities to the Exchange Agent's
account at The Depository Trust Company ("DTC").
The Exchange Offer shall expire at 5:00 p.m., New York City time, on
__________, 1997 or on such later date or time to which the Trust or the Company
may extend the Exchange Offer (the "Expiration Date"). Subject to the terms and
conditions set forth in the Prospectus, the Trust and the Company expressly
reserve the right to extend the Exchange Offer from time to time by giving oral
(to be confirmed in writing) or written notice to you no later than 5:00 p.m.,
New York City time, on the Business Day following the previously scheduled
Expiration Date.
The Trust and the Company expressly reserve the right to amend or terminate
the Exchange Offer, and not to accept for exchange any Original Capital
Securities not theretofore accepted for exchange, upon the occurrence of any of
the conditions of the Exchange Offer specified in the Prospectus under the
caption "The Exchange Offer--Conditions to the Exchange Offer." The Trust or
the Company will give oral (to be confirmed in writing) or written notice of any
amendment, termination or nonacceptance of Original Capital Securities to you as
promptly as practicable.
In carrying out your duties as Exchange Agent, you are to act in accordance
with the following instructions:
1. You will perform such duties and only such duties as are specifically
set forth herein and such duties which are necessarily incidental thereto;
provided, however, that in no way will your general duty to act in good faith be
discharged by the foregoing.
2. You will establish an account with respect to the Original Capital
Securities at DTC (the "Book-Entry Transfer Facility") for purposes of the
Exchange Offer within two Business Days after the date of the Prospectus, and
any financial institution that is a participant in the Book-Entry Transfer
Facility's systems may make book-entry delivery of the Original Capital
Securities by causing the Book-Entry Transfer Facility to transfer such Original
Capital Securities into your account in accordance with the Book-Entry Transfer
Facility's procedure for such transfer.
3. You are to examine each of the Letters of Transmittal, certificates
for Original Capital Securities (or confirmations of book-entry transfers into
your account at the Book-Entry Transfer Facility) and any Agent's Message or
other documents delivered or mailed to you by or for holders of the Original
Capital Securities to ascertain whether (i) the Letters of Transmittal and any
such other documents are duly executed and properly completed in accordance with
instructions set forth therein and (ii) the Original Capital Securities have
otherwise been properly tendered. In each case where the Letter of Transmittal
or any other document has been improperly completed or executed or any of the
certificates for Original Capital Securities are not in proper form for transfer
or some other irregularity in connection with the acceptance of the Exchange
Offer exists, you will endeavor to inform the presenters of the need for
fulfillment of all requirements and to take any other action as may be necessary
or advisable to cause such irregularity to be corrected.
4. With the approval of any Administrator of the Trust or any person
designated in writing by the Company (a "Designated Officer") (such approval, if
given orally, to be confirmed in writing) or any other party designated by any
such Administrator or Designated Officer in writing, you are authorized to waive
any irregularities in connection with any tender of Original Capital Securities
pursuant to the Exchange Offer.
5. Tenders of Original Capital Securities may be made only as set forth
in the Letter of Transmittal and in the section of the Prospectus captioned "The
Exchange Offer--
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Procedures for Tendering Original Capital Securities" and Original Capital
Securities shall be considered properly tendered to you only when tendered in
accordance with the procedures set forth therein.
Notwithstanding the provisions of this paragraph 5, Original Capital
Securities which any Administrator of the Trust or Designated Officer of the
Company shall approve as having been properly tendered shall be considered to be
properly tendered (such approval, if given orally, shall be confirmed in
writing).
6. You shall advise the Trust and the Company with respect to any
Original Capital Securities delivered subsequent to the Expiration Date and
accept their instructions with respect to disposition of such Original Capital
Securities.
7. You shall accept tenders:
(a) in cases where the Original Capital Securities are registered in
two or more names only if signed by all named holders;
(b) in cases where the signing person (as indicated on the Letter of
Transmittal) is acting in a fiduciary or a representative capacity only when
proper evidence of such person's authority to so act is submitted; and
(c) from persons other than the registered holder of Original Capital
Securities provided that customary transfer requirements, including payment of
any applicable transfer taxes, are fulfilled.
You shall accept partial tenders of Original Capital Securities where so
indicated and as permitted in the Letter of Transmittal and deliver certificates
for Original Capital Securities to the transfer agent for split-up and return
any untendered Original Capital Securities to the holder (or to such other
person as may be designated in the Letter of Transmittal) as promptly as
practicable after expiration or termination of the Exchange Offer.
8. Upon satisfaction or waiver of all of the conditions to the Exchange
Offer, the Trust will notify you (such notice, if given orally, to be confirmed
in writing) of the Company's and the Trust's acceptance, promptly after the
Expiration Date, of all Original Capital Securities properly tendered and you,
on behalf of the Trust, will exchange such Original Capital Securities for
Exchange Capital Securities and cause such Original Capital Securities to be
canceled. Delivery of Exchange Capital Securities will be made on behalf of the
Trust by you at the rate of $1,000 Liquidation Amount at maturity of Exchange
Capital Securities for each $1,000 Liquidation Amount at maturity of the
Original Capital Securities tendered promptly after notice (such notices, if
given orally, to be confirmed in writing) of acceptance of said Original Capital
Securities by the Trust; PROVIDED, HOWEVER, that in all cases, Original Capital
Securities tendered pursuant to the Exchange Offer will be exchanged only after
timely receipt by you of certificates for such Original Capital Securities (or
confirmation of book-entry transfer into your account at the Book-Entry Transfer
Facility), a
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properly completed and duly executed Letter of Transmittal (or facsimile
thereof) with any required signature guarantees (or an Agent's Message in lieu
thereof) and any other required documents. You shall issue Exchange Capital
Securities only in denominations of $1,000 or any integral multiple thereof.
Original Capital Securities may be tendered in whole or in part in denominations
of $100,000 and integral multiples of $1,000 in excess thereof provided that if
any Original Capital Securities are tendered for exchange in part, the untended
liquidation amount thereof must be $100,000 or any integral multiple of $1,000
in excess thereof.
9. Tenders pursuant to the Exchange Offer are irrevocable, except that,
subject to the terms and upon the conditions set forth in the Prospectus and the
Letter of Transmittal, Original Capital Securities tendered pursuant to the
Exchange Offer may be withdrawn at any time on or prior to the Expiration Date.
10. The Company and the Trust shall not be required to exchange any
Original Capital Securities tendered if any of the conditions set forth in the
Exchange Offer are not met. Notice of any decision by the Company and the Trust
not to exchange any Original Capital Securities tendered shall be given (such
notice, if given orally, shall be confirmed in writing) by the Company or the
Trust to you.
11. If, pursuant to the Exchange Offer, the Company or the Trust does not
accept for exchange all or part of the Original Capital Securities tendered
because of an invalid tender, the occurrence of certain other events set forth
in the Prospectus under the caption "The Exchange Offer--Conditions to the
Exchange Offer" or otherwise, you shall as soon as practicable after the
expiration or termination of the Exchange Offer return those certificates for
unaccepted Original Capital Securities (or effect the appropriate book-entry
transfer of the unaccepted Original Capital Securities), together with any
related required documents and the Letter of Transmittal relating thereto that
are in your possession, to the persons who deposited them.
12. All certificates for reissued Original Capital Securities, unaccepted
Original Capital Securities or for Exchange Capital Securities shall be
forwarded by (a) first-class mail, return receipt requested, under a blanket
surety bond protecting you, the Trust and the Company from loss or liability
arising out of the nonreceipt or nondelivery of such certificates or (b) by
registered mail insured separately for the replacement value of each of such
certificates.
13. You are not authorized to pay or offer to pay any concessions,
commissions or solicitation fees to any broker, dealer, bank or other persons or
to engage or utilize any person to solicit tenders.
14. As Exchange Agent hereunder, you
(a) will be regarded as making no representations and having no
responsibilities at to the validity, sufficiency, value or genuineness of any of
the certificates or the Original Capital Securities represented thereby
deposited with you pursuant to the
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Exchange Offer, and will not be required to and will make no representation as
to the validity, value or genuineness of the Exchange Offer; PROVIDED, HOWEVER,
that in no way will your general duty to act in good faith be discharged by the
foregoing;
(b) shall not be obligated to take any legal action hereunder which
might in your reasonable judgment involve any expense or liability, unless you
shall have been furnished with reasonable indemnity satisfactory to you;
(c) may conclusively rely on and shall be fully protected in acting
in good faith in reliance upon any certificate, instrument, opinion, notice,
letter, facsimile or other document or security delivered to you and reasonably
believed by you to be genuine and to have been signed by the proper party or
parties;
(d) may conclusively act upon any tender, statement, request,
agreement or other instrument whatsoever not only as to its due execution and
validity and effectiveness of its provisions, but also as to the truth and
accuracy of any information contained therein, which you shall in good faith
reasonably believe to be genuine or to have been signed or represented by a
proper person or persons;
(e) may conclusively rely on and shall be fully protected in acting
upon written or oral instructions from any Administrator of the Trust or from
any Designated Officer of the Company with respect to the Exchange Offer;
(f) shall not advise any person tendering Original Capital Securities
pursuant to the Exchange Offer as to the wisdom of making such tender or as to
the market value or decline or appreciation in market value of any Original
Capital Securities; and
(g) may consult with your counsel with respect to any questions
relating to your duties and responsibilities, and the written opinion or advice
of such counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by you hereunder in good faith
and in accordance with such written opinion of such counsel.
15. You shall take such action as may from time to time be requested by
any Administrator of the Trust or any Designated Officer of the Company (and
such other action as you may reasonably deem appropriate) to furnish copies of
the Prospectus, Letter of Transmittal and the Notice of Guaranteed Delivery, or
such other forms as may be approved from time to time by the Company or the
Trust, to all persons requesting such documents and to accept and comply with
telephone requests for information relating to the Exchange Offer, provided that
such information shall relate only to the procedures for accepting (or
withdrawing from) the Exchange Offer. The Company or the Trust shall furnish
you with copies of such documents at your request.
16. You shall advise by facsimile transmission or telephone, and promptly
thereafter confirm in writing to Xxxxxx X. Xxxxxx, Vice President--Finance of
the Company, and such other person or persons as the Trust or the Company may
request, daily (and more
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frequently during the week immediately preceding the Expiration Date and if
otherwise requested) up to and including the Expiration Date, as to the
liquidation amount of the Original Capital Securities which have been tendered
pursuant to the Exchange Offer and the items received by you pursuant to this
Agreement, separately reporting and giving cumulative totals as to items
properly received and items improperly received and items covered by Notices of
Guaranteed Delivery. In addition, you will also inform, and cooperate in making
available to, the Company and the Trust or any such other person or persons as
the Company or the Trust requests from time to time prior to the Expiration Date
of such other information as they or such person reasonably request. Such
cooperation shall include, without limitation, the granting by you to the
Company, the Trust and such person as the Company or the Trust may request of
access to those persons on your staff who are responsible for receiving tenders,
in order to ensure that immediately prior to the Expiration Date, the Company
and the Trust shall have received information in sufficient detail to enable
them to decide whether to extend the Exchange Offer. You shall prepare a list
of persons who failed to tender or whose tenders were not accepted and the
aggregate Liquidation Amount of Original Capital Securities not tendered or
Original Capital Securities not accepted and deliver said list to the Company
and the Trust at least seven days prior to the Expiration Date. You shall also
prepare a final list of all persons whose tenders were accepted, the Aggregate
Liquidation Amount of Original Capital Securities tendered and the Aggregate
Liquidation Amount of Original Capital Securities accepted and deliver said list
to the Company.
17. Letters of Transmittal and Notices of Guaranteed Delivery shall be
stamped by you as to the date and the time of receipt thereof and shall be
preserved by you for a period of time at least equal to the period of time you
preserve other records pertaining to the transfer of securities. You shall
dispose of unused Letters of Transmittal and other surplus materials by
returning them to the Company at the address set forth below for notices.
18. For services rendered as Exchange Agent hereunder, you shall be
entitled to such compensation and reimbursement of reasonable out-of-pocket
expenses as set forth on Schedule I attached hereto.
19. You hereby acknowledge receipt of the Prospectus and the Letter of
Transmittal and further acknowledge that you have examined each of them to the
extent necessary to perform your duties hereunder. Any inconsistency between
this Agreement, on the one hand, and the Prospectus and the Letter of
Transmittal (as they may be amended from time to time), on the other hand, shall
be resolved in favor of the latter two documents except with respect to the
duties, liabilities and indemnification of you as Exchange Agent, which shall be
controlled by this Agreement.
20. The Company agrees to indemnify and hold you (and your officers,
directors, employees and agents) harmless in your capacity as Exchange Agent
hereunder against any liability, cost or expense, including reasonable
attorneys' fees, arising out of or in connection with the performance of your
duties hereunder, other than those losses resulting from your negligence or
willful misconduct.
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21. This Agreement and your appointment as Exchange Agent hereunder shall
be construed and enforced in accordance with the laws of the State of New York
applicable to agreements made and to be performed entirely within such state,
and without regard to conflicts of law principles, and shall inure to the
benefit of, and the obligations created hereby shall be binding upon, the
successors and assigns of each of the parties hereto.
22. All communications, including notices, required or permitted to be
given hereunder shall be in writing and shall be deemed to have been duly given
if (i) delivered personally with receipt acknowledged, (ii) sent by registered
or certified mail, return receipt requested, (iii) transmitted by facsimile
(which shall be confirmed by telephone and by a writing sent by registered or
certified mail on the business day that such facsimile is sent) or (iv) sent by
recognized overnight courier for next business day delivery, addressed to the
parties at the addresses or facsimile numbers as any party shall hereafter
specify by communication to the other parties in the manner provided herein:
Company: SAFECO Corporation
0000 Xxxxxxxx Xxxxxx X.X.
Xxxxxxx, Xxxxxxxxxx 00000
Fax No.: (000) 000-0000
Attention: Xxxxx X. Xxxxx and
Xxxxxx X. Xxxxxx
with a copy to: Xxxxxxx Coie
0000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxxxx 00000-0000
Fax No.: (000) 000-0000
Attention: Xxxxxx Xxxx Xxxxxx
Exchange Agent: The Chase Manhattan Bank
c/o Chase Trust Company of California
Suite 2725
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Fax No.: (000) 000-0000
Attention: Xxxxx X. Xxxxx
with a copy to: Xxxxxx & Xxxxxx
Xxx Xxxxxxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax No.: (000) 000-0000
Attention: Xxxxxx Xxx, Esq.
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23. This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
24. In case any provision of this Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
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Please acknowledge receipt of this Agreement and confirm the arrangements
herein provided by signing and returning the enclosed copy.
SAFECO Capital Trust I
By:
-------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Administrative Trustee
SAFECO CORPORATION
By:
-------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President--Finance
Accepted as of the date
first above written:
THE CHASE MANHATTAN BANK,
as Exchange Agent
By:
-------------------------------
Name:
Title:
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