EX-4.32






Exhibit 4.32



 




COMMON SECURITIES GUARANTEE AGREEMENT




TRAVELERS CAPITAL TRUST [II] [III] [IV] [V]




DATED AS OF                     , 200_




 















 








Table of Contents




	 	 	 	 	 
	 	 	Page	 
	ARTICLE I

	DEFINITIONS AND INTERPRETATION

	 
	 	 	 	 
	SECTION 1.1 Definitions and Interpretation
	 	 	1	 
	SECTION 1.2 Interpretation
	 	 	3	 
	 
	 	 	 	 
	ARTICLE II

	GUARANTEE

	 
	 	 	 	 
	SECTION 2.1 Guarantee
	 	 	3	 
	SECTION 2.2 Waiver of Notice and Demand
	 	 	3	 
	SECTION 2.3 Obligations Not Affected
	 	 	4	 
	SECTION 2.4 Rights of Holders
	 	 	5	 
	SECTION 2.5 Guarantee of Payment
	 	 	5	 
	SECTION 2.6 Subrogation
	 	 	5	 
	SECTION 2.7 Independent Obligations
	 	 	5	 
	 
	 	 	 	 
	ARTICLE III

	LIMITATION OF TRANSACTIONS; SUBORDINATION

	 
	 	 	 	 
	SECTION 3.1 Limitation of Transactions
	 	 	5	 
	SECTION 3.2 Ranking
	 	 	6	 
	 
	 	 	 	 
	ARTICLE IV

	TERMINATION

	 
	 	 	 	 
	SECTION 4.1 Termination 
	 	 	6	 
	 
	 	 	 	 
	ARTICLE V

	MISCELLANEOUS

	 
	 	 	 	 
	SECTION 5.1 Successors and Assigns
	 	 	7	 
	SECTION 5.2 Amendments
	 	 	7	 
	SECTION 5.3 Notices
	 	 	7	 
	SECTION 5.4 Benefit
	 	 	8	 
	SECTION 5.5 Governing Law
	 	 	8	 






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COMMON SECURITIES GUARANTEE AGREEMENT




     This GUARANTEE AGREEMENT (the “Common Securities Guarantee”), dated as of [                    ,
200 ], is executed and delivered by The Travelers Companies, Inc., a Minnesota corporation
(the “Guarantor”), for the benefit of the Holders (as defined herein) from time to time of the
Common Securities (as defined herein) of Travelers Capital Trust [II] [III] [IV] [V], a Delaware
statutory trust (the “Issuer”).



     WHEREAS, pursuant to a Second Amended and Restated Declaration of Trust (the “Declaration”),
dated as of [                    , 200 ], among the trustees of the Issuer named therein, the
Guarantor, as sponsor, and the Holders from time to time of undivided beneficial interests in the
assets of the Issuer, the Issuer is issuing on the date hereof up to $[                    ]
aggregate liquidation preference of its [ ]% Common Securities (stated liquidation amount [$ ] per
common security) (the “Common Securities”) representing undivided beneficial interests in the
assets of the Issuer and having the terms set forth in the Declaration;



     WHEREAS, as incentive for the Holders to purchase the Common Securities, the Guarantor desires
to irrevocably and unconditionally agree, to the extent set forth in this Common Securities
Guarantee, to pay to the Holders of the Common Securities the Guarantee Payments (as defined
herein) and to make certain other payments on the terms and conditions set forth herein; and



     WHEREAS, the Guarantor is also executing and delivering a guarantee agreement (the “Preferred
Securities Guarantee”) in substantially identical terms to this Common Securities Guarantee for the
benefit of the holders of the Preferred Securities (as defined herein), except that if an Event of
Default (as defined in the Indenture), has occurred and is continuing, the rights of Holders of the
Common Securities to receive Guarantee Payments under this Common Securities Guarantee are
subordinated to the rights of holders of Preferred Securities to receive Guarantee Payments under
the Preferred Securities Guarantee.



     NOW, THEREFORE, in consideration of the purchase by each Holder of Common Securities, which
purchase the Guarantor hereby acknowledges and agrees shall benefit the Guarantor, the Guarantor
executes and delivers this Common Securities Guarantee for the benefit of the Holders.



ARTICLE I




DEFINITIONS AND INTERPRETATION




     SECTION 1.1 Definitions and Interpretation.



     In this Common Securities Guarantee, unless the context otherwise requires:




     (a) Capitalized terms used in this Common Securities Guarantee but not defined in the
preamble above have the respective meanings assigned to them in this Section 1.1;













 






     (b) terms defined in the Declaration as at the date of execution of this Common
Securities Guarantee have the same meaning when used in this Common Securities Guarantee
unless otherwise defined in this Common Securities Guarantee or unless otherwise required;




     (c) a term defined anywhere in this Common Securities Guarantee has the same meaning
throughout;




     (d) all references to “the Common Securities Guarantee” or “this Common Securities
Guarantee” are to this Common Securities Guarantee as modified, supplemented or amended
from time to time;




     (e) all references in this Common Securities Guarantee to Articles and Sections are to
Articles and Sections of this Common Securities Guarantee unless otherwise specified; and




     (f) a reference to the singular includes the plural and vice versa.



     “Affiliate” of any specified Person means any other Person directly or indirectly controlling
or controlled by or under direct or indirect common control with such specified Person. For the
purposes of this definition, “control” when used with respect to any specified Person means the
power to direct the management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms “controlling” and
“controlled” have meanings correlative to the foregoing.



     “Debentures” mean the series of [senior debt securities of the Guarantor designated the [ ]%
Senior Notes due [ ]][subordinated debt securities of the Guarantor designated the[ ]% Subordinated
Debentures due [ ]][junior subordinated debt securities of the Guarantor designated the [ ]% Junior
Subordinated Debentures due [ ]] held by the Institutional Trustee (as defined in the Declaration)
of the Issuer.



     “Guarantee Payments” shall mean the following payments or distributions, without duplication,
with respect to the Common Securities, to the extent not paid or made by the Issuer: (i) any
accrued and unpaid distributions which are required to be paid on such Common Securities to the
extent the Issuer shall have funds available therefor, (ii) the redemption price, including all
accrued and unpaid Distributions to the date of redemption (the “Redemption Price”) to the extent
the Issuer has funds available therefor, with respect to any Common Securities called for
redemption by the Issuer, and (iii) upon a voluntary or involuntary dissolution, winding-up or
termination of the Issuer (other than in connection with the distribution of Debentures to the
Holders in exchange for Common Securities as provided in the Declaration), the lesser of (a) the
aggregate of the liquidation amount and all accrued and unpaid distributions on the Common
Securities to the date of payment, to the extent the Issuer has funds available therefor, and (b)
the amount of assets of the Issuer remaining available for distribution to Holders in liquidation
of the Issuer (in either case, the “Liquidation Distribution”). If an Event of Default (as defined
in the Indenture), has occurred and is continuing, the rights of



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Holders of the Common Securities to receive Guarantee Payments under this Common Securities
Guarantee are subordinated to the rights of the Holders of Preferred Securities to receive
guarantee payments under the Preferred Securities Guarantee.



     “Holder” shall mean any holder, as registered on the books and records of the Issuer, of any
Common Securities.



     “Indenture” has the meaning specified in the Declaration.



     “Person” means any individual, corporation, partnership, joint venture, association,
joint-stock company, trust, limited liability company, unincorporated organization or government or
any agency or political subdivision thereof.



     “Preferred Securities” mean the securities representing preferred undivided beneficial
interests in the assets of the Issuer.



     “Regular Trustee” has the meaning specified in the Declaration.



     SECTION 1.2 Interpretation.



     Each definition in this Guarantee Agreement includes the singular and the plural, and
references to the neuter gender include the masculine and feminine where appropriate. Terms which
relate to accounting matters shall be interpreted in accordance with generally accepted accounting
principles in effect from time to time. All references to “the Guarantee Agreement” are to this
Guarantee Agreement as modified, supplemented or amended from time to time. References to any
statute mean such statute as amended at the time and include any successor legislation. The word
“or” is not exclusive, and the words “herein,” “hereof’ and “hereunder” refer to this Guarantee
Agreement as a whole. The headings to the Articles and Sections are for convenience of reference
and shall not affect the meaning or interpretation of this Guarantee Agreement. References to
Articles and Sections mean the Articles and Sections of this Guarantee Agreement unless otherwise
specified.



ARTICLE II




GUARANTEE




     SECTION 2.1 Guarantee.



     The Guarantor irrevocably and unconditionally agrees to pay in full to the Holders the
Guarantee Payments, as and when due, regardless of any defense, right of set-off or counterclaim
which the Issuer may have or assert. The Guarantor’s obligation to make a Guarantee Payment may be
satisfied by direct payment of the required amounts by the Guarantor to the Holders or by causing
the Issuer to pay such amounts to the Holders.



     SECTION 2.2 Waiver of Notice and Demand.



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     The Guarantor hereby waives notice of acceptance of this Common Securities Guarantee and of
any liability to which it applies or may apply, presentment, demand for payment, any right to
require a proceeding first against the Issuer or any other Person before proceeding against the
Guarantor, protest, notice of nonpayment, notice of dishonor, notice of redemption and all other
notices and demands.



     SECTION 2.3 Obligations Not Affected



     The obligations, covenants, agreements and duties of the Guarantor under this Common
Securities Guarantee shall in no way be affected or impaired by reason of the happening from time
to time of any of the following:




     (a) the release or waiver, by operation of law or otherwise, of the performance or
observance by the Issuer of any express or implied agreement, covenant, term or condition
relating to the Common Securities to be performed or observed by the Issuer;




     (b) the extension of time for the payment by the Issuer of all or any portion of the
Distributions, Redemption Price, Liquidation Distribution or any other sums payable under
the terms of the Common Securities or the extension of time for the performance of any
other obligation under, arising out of, or in connection with, the Common Securities (other
than an extension of time for payment of Distributions, Redemption Price, Liquidation
Distribution or other sum payable that results from the extension of any interest payment
period on the Debentures as permitted by the Indenture);




     (c) any failure, omission, delay or lack of diligence on the part of the Holders to
enforce, assert or exercise any right, privilege, power or remedy conferred on the Holders
pursuant to the terms of the Common Securities, or any action on the part of the Issuer
granting indulgence or extension of any kind;




     (d) the voluntary or involuntary liquidation, dissolution, sale of any collateral,
receivership, insolvency, bankruptcy, assignment for the benefit of creditors,
reorganization, arrangement, composition or readjustment of debt of, or other similar
proceedings affecting, the Issuer or any of the assets of the Issuer;




     (e) any invalidity of, or defect or deficiency in, the Common Securities;




     (f) the settlement or compromise of any obligation guaranteed hereby or hereby
incurred; or




     (g) any other circumstance whatsoever that might otherwise constitute a legal or
equitable discharge or defense of a guarantor, it being the intent of this Section 2.3 that
the obligations of the Guarantor hereunder shall be absolute and unconditional under any
and all circumstances.



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     There shall be no obligation of the Holders to give notice to, or obtain consent of, the
Guarantor with respect to the happening of any of the foregoing.



     SECTION 2.4 Rights of Holders.



     The Guarantor expressly acknowledges that any Holder of Common Securities may institute a
legal proceeding directly against the Guarantor to enforce its rights under this Common Securities
Guarantee, without first instituting a legal proceeding against the Issuer or any other Person.



     SECTION 2.5 Guarantee of Payment.



     This Common Securities Guarantee creates a guarantee of payment and not of collection.



     SECTION 2.6 Subrogation.



     The Guarantor shall be subrogated to all (if any) rights of the Holders of Common Securities
against the Issuer in respect of any amounts paid to such Holders by the Guarantor under this
Common Securities Guarantee; provided, however, that the Guarantor shall not (except to the extent
required by mandatory provisions of law) be entitled to enforce or exercise any rights which it may
acquire by way of subrogation or any indemnity, reimbursement or other agreement, in all cases as a
result of payment under this Common Securities Guarantee, if, at the time of any such payment, any
amounts are due and unpaid under this Common Securities Guarantee. If any amount shall be paid to
the Guarantor in violation of the preceding sentence, the Guarantor agrees to hold such amount in
trust for the Holders and to pay over such amount of the Holders.



     SECTION 2.7 Independent Obligations.



     The Guarantor acknowledges that its obligations hereunder are independent of the obligations
of the Issuer with respect to the Common Securities and that the Guarantor shall be liable as
principal and as debtor hereunder to make Guarantee Payments pursuant to the terms of this Common
Securities Guarantee notwithstanding the occurrence of any event referred to in subsections (a)
through (g), inclusive, of Section 2.3 hereof.



ARTICLE III


LIMITATION OF TRANSACTIONS; SUBORDINATION




     SECTION 3.1 Limitation of Transactions.



     So long as any Common Securities remain outstanding, if there shall have occurred any event
that would constitute an Event of Default or an event of default under the Declaration, then (a)
the Guarantor shall not declare or pay any dividend on, make any distributions with respect to, or
redeem, purchase, acquire or make a liquidation payment with respect to, any of its capital stock
(other than (i) repurchases, redemptions or other acquisitions of shares of capital stock of the
Guarantor in connection with any



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employment contract, benefit plan or other similar arrangement with or for the benefit of
employees, officers, directors or consultants, (ii) as a result of a reclassification of the
Guarantor’s capital stock, or the exchange or conversion of any class or series of the Guarantor’s
capital stock for any other class or series of the Guarantor’s capital stock, (iii) the purchase of
fractional interests in shares of the Guarantor’s capital stock pursuant to the conversion or
exchange provisions of such capital stock or the security being converted or exchanged, or (iv)
distributions of rights under any shareholders rights plan adopted by the Guarantor) or make any
guarantee payment with respect thereto and (b) the Guarantor shall not make any payment of interest
on, or principal of (or premium, if any, on), or repay, repurchase or redeem, any debt securities
issued by the Guarantor which rank pari passu with or junior to the Debentures and the Guarantor
shall not make any guarantee payments with respect thereto (other than pursuant to the Preferred
Securities Guarantee); provided, however, the Guarantor may declare and pay a stock dividend where
the dividend stock is the same stock as that on which the dividend is being paid.



     SECTION 3.2 Ranking.



     This Common Securities Guarantee will constitute an unsecured obligation of the Guarantor and
will rank (i) subordinate and junior in right of payment to all Senior Indebtedness (as defined in
the Indenture) of the Guarantor, (ii) pari passu with the most senior preferred or preference stock
now or hereafter issued by the Guarantor and with any guarantee now or hereafter entered into by
the Guarantor in respect of any preferred or preference stock of any Affiliate of the Guarantor,
and (iii) senior to the Guarantor’s common stock. If an Event of Default has occurred and is
continuing under the Declaration, the rights of the Holders of the Common Securities to receive
Guarantee Payments under this Common Securities Guarantee shall be subordinated to the rights of
the holders of the Preferred Securities to receive payment of all amounts due and owing under the
terms of the Preferred Guarantee.



ARTICLE IV




TERMINATION




     SECTION 4.1 Termination.



     This Common Securities Guarantee shall terminate upon full payment of the Redemption Price of
all Common Securities, upon the distribution of the Debentures to the Holders of all of the Common
Securities or upon full payment of the amounts payable in accordance with the Declaration upon
liquidation of the Issuer. Notwithstanding the foregoing, this Common Securities Guarantee will
continue to be effective or will be reinstated, as the case may be, if at any time any Holder of
Common Securities must restore payment of any sums paid under the Common Securities or under this
Common Securities Guarantee.



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ARTICLE V




MISCELLANEOUS




     SECTION 5.1 Successors and Assigns.



     All guarantees and agreements contained in this Common Securities Guarantee shall bind the
successors, assigns, receivers, trustees and representatives of the Guarantor and shall inure to
the benefit of the Holders of the Common Securities then outstanding.



     SECTION 5.2 Amendments.



     Except with respect to any changes which do not adversely affect the rights of Holders (in
which case no consent of Holders will be required), this Common Securities Guarantee may only be
amended with the prior approval of the Holders of at least a majority in liquidation amount of all
the outstanding Common Securities. The provisions of Section 12.2 of the Declaration with respect
to meetings of Holders of the Securities (as defined in the Declaration) apply to the giving of
such approval.



     SECTION 5.3 Notices.



     All notices provided for in this Common Securities Guarantee shall be in writing, duly signed
by the party giving such notice, and shall be delivered, telecopied or mailed by registered or
certified mail, as follows:




     (a) if given to the Issuer, in care of the Regular Trustee at the Issuer’s mailing
address set forth below (or such other address as the Issuer may give notice of to the
Holders of the Common Securities):


Travelers Capital Trust [II] [III] [IV] [V]

c/o The Travelers Companies, Inc.

385 Washington Street

St. Paul, Minnesota 55102

Attention: Matthew S. Furman





     (b) if given to the Guarantor, at the Guarantor’s mailing address set forth below (or
such other address as the Guarantor may give notice of to the Holders of the Common
Securities):


The Travelers Companies, Inc.

385 Washington Street

St. Paul, Minnesota 55102

Attention: Matthew S. Furman





     (c) if given to any Holder of the Common Securities, at the address set forth on the
books and records of the Issuer.



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     All such notices shall be deemed to have been given when received in person, telecopied with
receipt confirmed, or mailed by first class mail, postage prepaid except that if a notice or other
document is refused delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered on the date of such
refusal or inability to deliver.



     SECTION 5.4 Benefit.



     This Common Securities Guarantee is solely for the benefit of the Holders of the Common
Securities and is not separately transferable from the Common Securities.



     SECTION 5.5 Governing Law.



     THIS COMMON SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.



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     IN WITNESS WHEREOF, the parties hereto have caused this Common Securities Guarantee Agreement
to be duly executed as of the date hereof.



	 	 	 	 	 
	 	THE TRAVELERS COMPANIES, INC.,

as Guarantor

 	 
	 	By:  	 	 
	 	 	Name:  	Matthew S. Furman 	 
	 	 	Title:  	Senior Vice President 	 
	 
	 	TRAVELERS CAPITAL TRUST [II]

[III] [IV] [V],

as Issuer

 	 
	 	By:  	 	 
	 	 	Name:  	Matthew S. Furman 	 
	 	 	Title:  	Regular Trustee 	 
	 




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