Exhibit 10.1
2008 SENIOR PREFERRED STOCK
REDEMPTION AGREEMENT
          This 2008 Senior Preferred Stock Redemption Agreement (this
“Agreement”), effective as of December 1, 2010, is entered into by and between
CNA Financial Corporation, a Delaware corporation (the “Company”), and Loews
Corporation, a Delaware corporation (“Loews”).
          WHEREAS, Loews purchased 12,500 shares of the Company’s 2008 Senior
Preferred Stock (the “2008 Preferred”) for $1,250,000,000 from the Company on
November 7, 2008;
          WHEREAS, pursuant to Section 4 of the Certificate of Designation
creating the 2008 Preferred (the “Certificate of Designation”), the 2008
Preferred accrues dividends at the rate provided for therein;
          WHEREAS, Section 5 of the Certificate of Designation provides that the
2008 Preferred may be redeemed upon the mutual agreement of the Company and the
Holders (as defined in the Certificate of Designation) of a majority of the
outstanding shares of the 2008 Preferred, at any time and from time to time, at
the Redemption Price described below in Section 1(b);
          WHEREAS, Loews is the sole Holder of the 2008 Preferred;
          WHEREAS, the Company redeemed 2,500 shares of the 2008 Preferred from
Loews pursuant to the 2008 Senior Preferred Stock Redemption Agreement dated as
of November 10, 2009 between the Company and Loews;
          WHEREAS, the Company redeemed 5,000 shares of the 2008 Preferred from
Loews pursuant to the 2008 Senior Preferred Stock Redemption Agreement dated as
of August 5, 2010;
          WHEREAS, the Company desires to redeem the remaining 5,000 shares of
the 2008 Preferred from Loews and Loews desires to dispose of the remaining
5,000 shares of the 2008 Preferred to the Company.
          NOW THEREFORE, in consideration of the mutual promises set forth
herein, and other good and valuable consideration, it is hereby agreed by and
between the Company and Loews as follows:
          1.       Redemption of the 2008 Preferred.
                    a.       The Company hereby agrees to (i) call for
redemption 5,000 shares of the 2008 Preferred and (ii) pay to Loews the
Redemption Price (as defined below) for such shares (the “Redemption”) on
December 1, 2010.
                    b.       “Redemption Price” shall mean a per share
redemption price equal to (i) $100,000 plus (ii) an amount equal to all unpaid
dividends accrued on such shares

 

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up to but excluding the date of Redemption (which amount shall be calculated
pursuant to Section 4 of the Certificate of Designation), which amount is
calculated to be eight million three hundred thirty-three thousand three hundred
thirty-three and 33/100ths dollars ($8,333,333.33). Although Section 5 of the
Certificate of Designation provides that the per share Redemption price shall
include all unpaid dividends accrued thereon through and including the date of
Redemption, the parties acknowledge and agree that the Redemption Price shall
exclude dividends accruing on the date of Redemption.
          2.       Legal Opinion.    Prior to the Redemption, the Company shall
furnish to Loews an opinion of counsel from Jonathan D. Kantor, Esq., Executive
Vice President, Secretary and General Counsel of the Company, substantially in
the form attached hereto and made a part hereof as Exhibit A.
          3.       Amendment and Waiver.   This Agreement shall not be altered,
amended or supplemented except by written instruments. Any waiver of any term,
covenant, agreement or condition contained in this Agreement shall not be deemed
a waiver of any other term, covenant, agreement or condition, and any waiver of
any default in any such term, covenant, agreement or condition shall not be
deemed a waiver of any later default thereof or of any other term, covenant,
agreement or condition. No delay on the part of any party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof.
          4.       Severability.   In the event that any court or any
governmental authority or agency declares any provision of this Agreement to be
unlawful or invalid, such unlawfulness or invalidity shall not serve to
invalidate any other provisions of this Agreement, and in the event that only a
portion of any provision is so declared to be unlawful or invalid, such
unlawfulness or invalidity shall not serve to invalidate the balance of such
provision.
          5.       Successors and Assigns.   All representations, warranties,
covenants and agreements of the parties contained in this Agreement or made in
writing in connection herewith, shall, except as otherwise provided herein, be
binding upon and inure to the benefit of their respective nominees, successors
and assigns and, in the case of a natural person, of his or her heirs and
personal representatives.
          6.       Notices.   All communications provided for hereunder shall be
in writing and delivered by hand, by express delivery service with confirmed
receipt or by first-class or certified mail, postage prepaid, and, if to Loews
or its nominee, addressed to Loews at 667 Madison Avenue, New York, New York
10065-8087 or at such other address as Loews may designate to the Company in
writing, and if to the Company, addressed to the Company at 333 South Wabash
Avenue, Chicago, Illinois 60604; Attention: Treasurer, with a copy to or such
other address as the Company may designate to Loews in writing.
          7.       Governing Law.   The validity, meaning and effect of this
Agreement shall be determined in accordance with the domestic laws of the state
of Illinois applicable to contracts made and to be performed in that state
without giving effect to any choice or

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conflict of law provision or rule (whether in the state of Illinois or any other
jurisdiction) that would cause the application of the laws of any jurisdiction
other than the state of Illinois.
          8.       Counterparts.   This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original but all of which shall
together constitute one and the same document.
          9.       Headings.   The headings used herein are solely for the
convenience of the parties and shall not constitute a part hereof or serve to
modify or interpret the text.
          10.       Entire Agreement and Exhibit.   This Agreement and the
Exhibit hereto constitute and encompass the entire agreement and understanding
of the parties hereto with regard to the transactions contemplated or provided
for herein.
[Signature Page Follows]

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          IN WITNESS WHEREOF, this Agreement has been executed and deemed
effective as of the date first above written.

                CNA FINANCIAL CORPORATION

      By:        /s/ Lawrence J. Boysen       Name:  Lawrence J. Boysen     
Title:  Senior Vice President & Corporate Controller   

[Signature Page to Redemption Agreement]

 

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            LOEWS CORPORATION

      By: /s/ Peter W. Keegan      Name:   Peter W. Keegan      Title:   Senior
Vice President & Chief Financial Officer     

[Signature Page to Redemption Agreement]

 

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EXHIBIT A
[CNA Financial Corporation Letterhead]
December 1, 2010
Loews Corporation
667 Madison Avenue
New York, New York 10065-8087
Attn:  General Counsel
Ladies and Gentlemen:
           I am providing this opinion as Executive Vice President, General
Counsel and Secretary of CNA Financial Corporation, a Delaware corporation (the
“Company”), in connection with the transactions contemplated by that certain
2008 Senior Preferred Stock Redemption Agreement (the “Redemption Agreement”),
dated as of December 1, 2010, by and between the Company and Loews Corporation
(“Loews”), pursuant to which the Company will redeem the remaining 5,000 shares
of the Company’s 2008 Senior Preferred Stock, no par value (the “Shares”), owned
by Loews and, in consideration for which, the Company will pay the Redemption
Price. Capitalized terms used herein, but not otherwise defined, shall have the
meanings provided for such terms in the Redemption Agreement.
          In connection with the foregoing, I have examined the minute books and
stock records of the Company; the Certificate of Incorporation and By-Laws of
the Company; copies of the resolutions of the Board of Directors of the Company
relating to the redemption of the Shares. In addition, I have reviewed such
other documents and instruments, investigated such matters of law and have
conferred with such officers and directors of the Company and have ascertained
or verified to my satisfaction, such additional facts with respect to the
Company which I have deemed necessary or appropriate for the purposes of
rendering this opinion.
          In connection with this opinion, I have examined originals, or copies
identified to my satisfaction as being true copies, of the Redemption Agreement.
I do not express any opinion as to any matters governed by any laws other than
the laws of the State of Illinois and the General Corporation Law of the State
of Delaware.
          Based upon and qualified by the foregoing, I am of the opinion that:

  1.   The Company is a corporation duly organized, validly existing as a
corporation in good standing under the laws of the State of Delaware;     2.  
The Redemption Agreement has been duly authorized, executed and delivered by the
Company;

 

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  3.   The execution and delivery by the Company of, and the performance by the
Company of its obligations under, the Redemption Agreement will not contravene
the Certificate of Incorporation or By-Laws of the Company or, to my knowledge,
any provision of applicable law;     4.   The Redemption Agreement constitutes a
legal, valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms, except as may be limited by (i) any
applicable bankruptcy, insolvency, reorganization, receivership, moratorium,
fraudulent conveyance, equitable subordination, readjustment of debt and other
similar laws now or hereafter in effect affecting creditors’ rights generally,
(ii) general principles of equity, including, without limitation, concepts of
materiality, reasonableness, public policy, good faith, fair dealing and the
possible unavailability of specific performance, injunctive relief or other
equitable relief (regardless of whether applied in a proceeding at law or in
equity) and (iii) public policy considerations; and     5.   The redemption of
the Shares in accordance with the terms and conditions of the Redemption
Agreement has been duly authorized by the Board of Directors of the Company or a
Committee thereof.

          This opinion is being furnished pursuant to Section 2 of the
Redemption Agreement and is for the sole benefit of the addressee hereto in
connection with the above-described matter. This opinion may not be relied upon
by you for any other purpose, or relied upon by any other person, firm or
corporation or quoted, filed with any governmental authority or other regulatory
agency or otherwise circulated or used for any other purpose without my prior
consent. This opinion is limited to the matters set forth herein; no opinion may
be inferred or implied beyond the matters expressly stated in this opinion. This
opinion is rendered on the date hereof and I have no continuing obligation
hereunder to inform you of changes of law or fact subsequent to the date hereof
or facts of which I become aware after the date hereof.
Very truly yours,
Jonathan D. Kantor
Executive Vice President,
General Counsel and Secretary