Exhibit 3.1
A467587
ENDORSED
FILED
In the office of the Secretary of State
Of the State of California
OCT 31 1995
BILL JONES; Secretary of State
AGREEMENT OF MERGER
AMONG
SIERRA HEALTH SERVICES, INC.
HEALTH ACQUISITION CORP.
AND
CII FINANCIAL, INC.
THIS AGREEMENT OF MERGER, is entered into to be effective on the
Effective Date set forth below by and among Sierra Health Services, Inc., a
Nevada corporation ("Sierra"), Health Acquisition Corp., a California
corporation and a wholly-owned subsidiary of Sierra ("Sierra Sub"), and
CII Financial, Inc., a California corporation ("CII").
W I T N E S S E T H
WHEREAS, the parties to this Agreement have determined that it is in
the best interests of each of them to merge Sierra Sub with and into CII.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants set forth below, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties to this
Agreement hereby agree as follows:
A G R E E M E N T
1. Merger. Upon the Effective Date, as defined below, Sierra Sub shall
be merged with and into CII (the "Merger") in accordance with the provisions of
the California General Corporation Law (California Corporations Code Section
1100 et seq. (the "Law")). For purposes of the Law and this Agreement, CII shall
be the surviving corporation, and Sierra Sub shall be the disappearing
corporation.
2. Name. The name of the surviving corporation shall be
"CII Financial, Inc."
3. Effective Date. The Merger shall become effective at
11:59 p.m. Pacific Standard Time on October 31, 1995 (the "Effective Date").
4. Compliance with Law. The parties shall take such steps as may be
necessary under the Law or otherwise to give effect to this Agreement, including
the filing of a copy of this Agreement in the offices of the Secretary of State
of the State of California, together with the certificates required by Section
1103 of the Law.
5. Articles of Incorporation. On the Effective Date, Article IV
of the Articles of Incorporation of the surviving corporation shall be amended
to read in its entirety as provided in Exhibit A attached hereto and
incorporated herein.
6. Effect on Outstanding Shares of Disappearing and Surviving
Corporation. On the Effective Date, by virtue of the Merger and without any
action on the part of the holder of any shares of common stock, stated value
$.50 per share, of CII (the "CII Common Stock") or capital stock of Sierra Sub,
except for shares of CII Common Stock as to which dissenters' rights are
perfected under the General Corporation Law of California:
(a) Each issued and outstanding share of the capital stock of
Sierra Sub shall be converted into and become one fully paid and nonassessable
share of common stock, stated value $.50 per share, of the surviving
corporation.
(b) All shares of CII Common Stock that are owned by Sierra,
Sierra Sub or any other wholly-owned subsidiary of Sierra shall be canceled and
retired and shall cease to exist and no stock of Sierra or other consideration
shall be delivered in exchange therefor.
(c) (i) Subject to Section 6(d), each issued and outstanding
share of CII Common Stock (other than shares to be cancelled in accordance with
Section 6(b) shall be converted into the right to receive .370 of a fully paid
and nonassessable share of common stock, par value $.005 per share, of Sierra
(the "Sierra Common Stock"), including the corresponding percentage of a right
(the "Right") to purchase shares of Series A Junior Participating Preferred
Stock of Sierra pursuant to the Rights Agreement (the "Rights Agreement") dated
as of June 14, 1994 between Sierra and Continental Stock Transfer & Trust
Company, as Rights Agent. Prior to the "distribution date" (as defined in the
Rights Agreement), all references in this Agreement to Sierra Common Stock to be
received pursuant to the Merger shall be deemed to include the Rights. All such
shares of CII Common stock shall no longer be outstanding and shall
automatically be cancelled and retired and shall cease to exist, and each holder
of a certificate representing any such shares shall cease to have any rights
with respect thereto, except the right to receive the shares of Sierra Common
Stock to be issued in consideration therefor upon the surrender of such
certificate, without interest.
(ii) With respect to CII's 7 1/2% Convertible Subordinated
Debentures Due 2001 (the "CII Debentures") issued pursuant to the Indenture (the
"Indenture") dated as of September 15, 1991 between CII and Manufacturers
Hanover Trust Company, as Trustee (the "Trustee"), and pursuant to an indenture
supplemental thereto to be executed by and among CII, Sierra and the Trustee,
the CII Debentures will no longer be convertible into CII Common Stock and will
become convertible into Sierra Common Stock. The price at which such shares of
Sierra Common Stock shall be delivered upon conversion of the CII Debentures
shall be the quotient of the "conversion price" (as defined in the Indenture) in
effect immediately prior to the Effective Date divided by .370, subject to
further adjustment as provided in the Indenture.
(iii) With respect to CII's stock option plans (the "CII
Plans"), each outstanding option to purchase shares of CII Common Stock issued
pursuant to the CII Plans will be assumed by Sierra and will constitute an
option to acquire the same number of shares of Sierra Common Stock into which
such shares would have been converted pursuant to the Merger had such options
been exercised immediately prior to the Effective Date.
(d) No fractions of a share of Sierra Common Stock shall be issued in
the Merger, but in lieu thereof each holder of shares of CII Common Stock
otherwise entitled to a fraction of a share of Sierra Common Stock shall, upon
surrender of his or her certificate or certificates, be entitled to receive an
amount of cash (without interest) determined by multiplying the closing price
for Sierra Common Stock as reported on the New York Stock Exchange Composite
Transactions on the business day two days prior to the Effective date by the
fractional share interest to which such holder would otherwise be entitled.
7. Effect of Merger. The effect of the Merger shall be as
prescribed by the Law. Pursuant to Section 1107 of the Law, without any further
act of the parties:
(a) On the Effective Date, the separate existence of Sierra Sub shall
cease, and the surviving corporation shall succeed, without other transfer, to
all the rights and properties of Sierra Sub and shall be subject to all the
debts and liabilities of Sierra Sub in the same manner as if the surviving
corporation had itself incurred them.
(b) After the Effective Date, all rights of creditors and all liens
upon the property of Sierra Sub shall be preserved unimpaired, provided of
Sierra Sub shall be preserved unimpaired, provided that such liens of Sierra Sub
shall be limited to the property affected thereby immediately prior to the
Effective Date.
(c) After the Effective Date, any action or proceeding pending by or
against Sierra Sub may be prosecuted to judgment, which shall bind the surviving
corporation, or the surviving corporation may be proceeded against or
substituted in place of Sierra Sub.
8. Miscellaneous.
8.1 Governing Law. This Agreement, the transactions
contemplated hereby and the rights of the parties hereunder and under statutory
and common law with respect to the transactions contemplated hereby shall be
governed and construed in accordance with the laws of the State of California.
8.2 Headings. The headings and subheadings used in this
Agreement are for convenience of reference only and shall not be considered in
construing this Agreement.
8.3 Counterpart Execution. This Agreement may be executed in
two or more counterparts all of which shall be considered one and the same
agreement and shall become effective when two or more counterparts have been
signed by each of the parties and delivered to the other parties, it being
understood that all parties need not sign the same counterpart.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of October 20, 1995.
SIERRA HEALTH SERVICES, INC.
By:__________/s/_________________
Erin E. MacDonald
President
______/s/__________________
Frank E. Collins
Secretary
HEALTH ACQUISITION CORP.
By:____________/s/________________
Erin E. MacDonald
President
______/s/___________________
Frank E. Collins
Secretary
CII FINANCIAL, INC.
By:_____________________________
Joseph G. Havlick
Chairman of the Board, Chief
Executive Officer and President
- ------------------------
Richard E. Dobson
Secretary
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
October 20, 1995.
SIERRA HEALTH SERVICES, INC.
By:__________/s/_________________
Erin E. MacDonald
President
______/s/__________________
Frank E. Collins
Secretary
HEALTH ACQUISITION CORP.
By:____________/s/________________
Erin E. MacDonald
President
______/s/___________________
Frank E. Collins
Secretary
CII FINANCIAL, INC.
By:__________/s/___________________
Joseph G. Havlick
Chairman of the Board, Chief
Executive Officer and President
____/s/____________________
Richard E. Dobson
Secretary
EXHIBIT A
IV
"The corporation is authorized to issue only one class of shares of
stock which shall be designated as "Common Stock" and the total number of shares
which this corporation is authorized to issue is one thousand (1,000)."
CERTIFICATE OF APPROVAL
OF
AGREEMENT OF MERGER
OF
CII FINANCIAL, INC.
Joseph G. Havlick and Richard E. Dobson do hereby certify that:
1. They are the President and Secretary, respectively, of CII
Financial, Inc., A California corporation (the "Corporation").
2. The principal Terms of the agreement of merger in the form
attached hereto were duly approved by the Board of Directors of the Corporation.
3. There is only one class of shares of the Corporation and the
total number of outstanding shares entitled to vote on the agreement of merger
is 7,187,721 shares.
4. The principal terms of the agreement of merger in the form attached
hereto were duly approved by the Corporation by the vote of a number of shares
that equaled or exceeded the vote required.
5. The percentage vote required is ore than 50% of the
outstanding shares.
We further declare under penalty of perjury under the laws of the State
of California that the matters set forth in this Certificate are true and
correct of our own knowledge.
DATE: October 31, 1995
__________/s/________________________
Joseph G. Havlick, President
__________/s/________________________
Richard E. Dobson, Secretary
CERTIFICATE OF APPROVAL
OF
AGREEMENT OF MERGER
OF
HEALTH ACQUISITION CORP.
Erin E. MacDonald and Frank E. Collins do hereby certify that:
1. They are the president and the secretary, respectively, of
Health Acquisition Corp., a California corporation (the "Corporation").
2. The principal Terms of the agreement of merger in the form
attached hereto were duly approved by the board of directors of the corporation.
3. There is only one class of shares of the Corporation and the
total number of outstanding shares entitled to vote on the agreement of merger
is 100.
4. The principal terms of the agreement of merger in the form attached
hereto were duly approved by the Corporation by the vote of a number of shares
which equaled or exceeded the vote required.
5. The percentage vote required is ore than 50% of the
outstanding shares.
6. The vote required of the shareholders of Sierra Health
Services, Inc., the parent of the Corporation, was obtained.
We further declare under penalty of perjury under the laws of the State
of California that the matters set forth in this certificate are true and
correct of our own knowledge.
Date: October 31, 1995.
--
__________/s/__________________
Erin E. MacDonald, President
__________/s/__________________
Frank E. Collins, Secretary
1622843
ENDORSED
FILED
In the office of the Secretary of State
Of the State of California
SEP 15 1998
MARCH FONG EU; Secretary of State
ARTICLES OF INCORPORATION
OF
CII FINANCIAL, INC.
I
The name of this corporation is CII FINANCIAL, INC.
II
The purpose of this corporation is to engage in any lawful act or
activity for which a corporation may be organized under the General Corporation
Law of California other than the banking business, the trust company business or
the practice of a profession permitted to be incorporated.
III
The name and address in the State of California of this corporation's initial
agent for service of process is: Joseph G. Havlick, 4001 West Alameda Avenue,
Suite 301, Burbank, California 91505.
IV
The corporation is authorized to issue only one class of shares of
stock which shall be designated as "Common Stock"; and the total number of
shares which this corporation is authorized to issue is one hundred million
(100,000,000).
V
Section 1. The liability of the directors of the corporation for
monetary damages shall be eliminated to the fullest extent permissible under
California law.
Section 2. The corporation is authorized to provide indemnification of
agents (as defined in Section 317 of the California Corporations Code) through
bylaw provisions, agreements with the agents, vote of shareholders or
disinterested directors, or otherwise, in excess of the indemnification
otherwise permitted by limits set forth in Section 204 of the California
Corporations Code with respect to actions for breach of duty to the corporation
or its shareholders. The corporation is further authorized to provide insurance
for agents as set forth in Section 317 of the California Corporations Code,
provided that, in cases where the corporation owns all or a portion of the
shares of the company issuing the insurance policy, the company and/or the
policy must meet one of the two sets of conditions set forth in Section 317, as
amended.
CIIF ARTICLES
PAGE 2
Section 3. Any repeal or modification of the foregoing provisions of
this Article V by the shareholders of this corporation shall not adversely
affect any right or protection of an agent of this corporation existing at the
time of such repeal or modification.
DATED: September 13, 1988.
___________/s/____________________
Trude A. Tsujimoto
Incorporator
I hereby declare that I am the person who executed the foregoing
Articles of Incorporation, which execution is my act and deed.
_________/s/______________________
Trude A. Tsujimoto