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EXHIBIT 10.9
PLAN AND AGREEMENT OF EXCHANGE
This Plan and Agreement of Exchange ("Agreement") is entered into
between and among CITIZENS INSURANCE COMPANY OF AMERICA, a Colorado-domiciled
insurance company ("CICA") and AMERICAN INVESTMENT NETWORK, INC., a Mississippi
corporation ("American").
WITNESSETH
WHEREAS, CICA, which was chartered on February 13, 1968 in Colorado as
Continental Investors Life Insurance Company, Inc. ("CILIC"), and by Articles
of Merger filed with the Secretary of State of Colorado on August 31, 1988,
CILIC changed its corporate name to Citizens Insurance Company of America is a
wholly owned subsidiary of Citizens, Inc., a Colorado corporation ("Citizens");
and
WHEREAS, American, which was chartered in 1987 in the State of
Mississippi as Great American Investment Network, Inc., and in 1995 changed its
name to American Investment Network, Inc., owns all of the issued and
outstanding capital stock of United Security Life Insurance Company, a
Mississippi-domiciled stock insurance company ("USLI"), which was chartered in
1967 in the State of Mississippi as American Empire Life Insurance Company,
which name was changed in 1973 to Financial Security Life of Mississippi, which
was in 1994 merged with United Security Life Insurance Company, a corporation
chartered in 1987 in the State of Mississippi, and at which time the name of
the merged corporation was changed to United Security Life Insurance Company;
and
WHEREAS, CICA and American desire to effect a share exchange pursuant
to Mississippi Code Ann. 79-4-11.01 et seq. and 83-19-99 et seq. (together the
"Exchange Act") in which all the outstanding shares of Class "A" Common Stock
and Class "B" Common Stock of American will be exchanged for shares of Class A
Common Stock of Citizens owned and held by CICA;
NOW, THEREFORE, it is agreed among the parties as follows:
ARTICLE I
The Exchange
1.1 Subject to the terms and conditions set forth herein, the
transactions contemplated by this Agreement shall be completed at a closing
("Closing") on a closing date ("Closing Date") to occur as soon as possible
after all regulatory approvals and shareholder approvals are obtained in
accordance with law and as required by this Agreement. On the Closing Date, all
of the documents to be furnished to American and CICA, including the documents
to be furnished pursuant to Article VII of this Agreement, shall be delivered
to Jones & Keller, P.C., counsel to CICA ("Jones & Keller") to be held in
escrow until the Effective Date or the date of termination of this Agreement,
whichever first occurs and thereafter shall be promptly distributed to the
parties as their interests may appear.
1.2 The terms of the Exchange shall be:
(i) The Exchange shall be effective ("Effective
Date") as of the filing of the Certificate of
Exchange by American and CICA with the
Secretary of State and the Commissioner of
Insurance of the State of Mississippi or, if
later, the date specified therein.
(ii) At and as of the Effective Date:
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(a) each shareholder of American prior to the
Effective Date shall cease to be a shareholder of
American;
(b) The ownership of all issued and outstanding
stock of American (other than shares for which
dissenter's rights are perfected in accordance with
the Exchange Act) shall vest in CICA automatically
without any physical transfer or deposit of the
certificates representing such shares, and CICA will
become the sole shareholder of American;
(c) the holders of each issued and outstanding
share of American Class A or Class B Common Stock
prior to the Effective Date (other than any shares
for which dissenter's rights are perfected in
accordance with the Exchange Act) shall have the
right to receive from CICA in accordance with Article
II of the Agreement one (1) share of Citizens Class A
common stock, no par value, for each seven and
two-tenths (7.2) shares of American Class A or Class
B Common Stock prior to the Effective Date, provided,
however, that all consideration to be received shall
be subject to equitable adjustment in the event of
any stock split, stock dividend, reverse stock split,
or other change in the number of American shares
outstanding; and
(d) the holders of each issued and outstanding
share of American Class A or Class B Common Stock
prior to the Effective Date for which dissenter's
rights are perfected in accordance with the Exchange
Act shall have the right to receive from American
payment therefor in accordance with the Exchange Act.
(iii) The directors and officers of American shall
be removed as of the Effective Date, and the
directors and officers of CICA shall become
the directors and officers of American as of
the Effective Date.
(iv) The Exchange shall have the effect set forth
in the Exchange Act.
1.3 On the Closing Date, American and CICA will file with the
Secretaries of State of Mississippi and Colorado Articles of Share Exchange in
the forms attached hereto as Exhibit A.
ARTICLE II
Exchange of Shares
2.1 At the Effective Date, the shares of Citizens Class A common
stock to be exchanged as provided in Section 1.2 shall be distributed by CICA
to shareholders of American (other than those shares as to which dissenters'
rights have been perfected in accordance with the Exchange Act).
2.2 The stock transfer books of American shall be closed on the
Effective Date, and thereafter no transfers of the stock of American shall be
made. CICA shall appoint an exchange agent ("Exchange Agent"), which is
expected to be Citizens' then stock transfer agent ("Stock Transfer Agent"), to
accept surrender of the certificates representing the shares of American and to
deliver for such surrendered certificates, shares of Class A common stock of
Citizens. If outstanding certificates for shares of American are not
surrendered or the payment for them is not claimed prior to such date on which
such payments would otherwise escheat to or become the property of any
governmental unit or agency, the unclaimed items shall, to the extent permitted
by abandoned property and other applicable law, become the property of CICA
(and to the extent not in its possession shall be paid over to it), free and
clear of all claims
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or interest of any persons previously entitled to such items. Notwithstanding
the foregoing, neither the Exchange Agent nor any party to this Agreement shall
be liable to any holder of American shares for any amount paid to any
governmental unit or agency having jurisdiction of such unclaimed item pursuant
to the abandoned property or other applicable law of such jurisdiction.
2.3 No fractional shares of Citizens stock shall be exchanged as a
result of the Agreement; rather, such shares shall evidence the right to
receive a cash value per fractional share of Citizens Class A common stock
which shall be the average closing price of the Class A common stock of
Citizens as reported on the American Stock Exchange for the five trading days
prior to the Effective Date. In the event the exchange of shares results in any
shareholder being entitled to a fraction less than a whole share of Citizens
stock, such shareholder shall be given a cash payment by American for such
fractional share at the rate per share as calculated in the previous sentence.
2.4 At the Effective Date, each holder of a certificate or
certificates representing shares of American, upon presentation and surrender
of such certificate or certificates to the Exchange Agent, shall be entitled to
receive the consideration set forth herein, except that holders of those shares
as to which dissenters' rights shall have been asserted and perfected pursuant
to the Exchange Act shall not be converted into shares of Citizens Class A
common stock, but shall represent only such dissenters' rights. Upon such
presentation, surrender, and exchange as provided in this Section 2.4,
certificates representing shares of American previously held shall be canceled.
Until so presented and surrendered, each certificate or certificates which
represented issued and outstanding shares of American at the Effective Date
shall be deemed for all purposes to evidence the right to receive the
consideration set forth in Section 1.2 of this Agreement. If the certificates
representing shares of American have been lost, stolen, mutilated or destroyed,
the Exchange Agent shall require the submission of an indemnity agreement and
may require the submission of a bond in lieu of such certificate.
ARTICLE III
Representations, Warranties and Covenants of CICA
No representations or warranties are made by any director, officer,
employee or shareholder of CICA as individuals, except as and to the extent
stated in this Agreement or in a separate written statement (the "CICA
Disclosure Statement"). CICA hereby represents, warrants and covenants to
American, except as stated in the CICA Disclosure Statement, as follows:
3.1 Citizens and CICA are, respectively, a corporation and an
insurance company, each duly organized, validly existing and in good standing
under the laws of the State of Colorado, and each have the corporate power and
authority to own or lease its properties and to carry on its business as it is
now being conducted. The Articles of Incorporation and Bylaws of Citizens and
CICA, copies of which have been delivered to American, are complete and
accurate, and the minute books of Citizens and CICA contain a record, which is
complete and accurate in all material respects, of all meetings, and all
corporate actions of the shareholders and Board of Directors of Citizens and
CICA.
3.2 The aggregate number of shares which Citizens is authorized to
issue is 50,000,000 shares of Class A common stock, no par value, and 1,000,000
shares of Class B common stock, no par value; of which 21,651,161 shares of
such Class A common stock are issued and 19,572,614 shares are outstanding,
fully paid and nonassessable and 621,049 shares of Class B common stock are
issued and outstanding, fully paid and nonassessable. There are 1,955,457
shares of Class A common stock of Citizens owned and held by CICA that will be
used to satisfy the exchange obligations of CICA under the Agreement. Citizens
has no outstanding options, warrants, or other rights to purchase, or subscribe
to, or securities convertible into or exchangeable for any shares of capital
stock, except an option for
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76,000 shares of Class A common stock. The two (2) classes of stock of Citizens
are equal in all respects, except (a) the Class B common stock elects a simple
majority of the Board of Directors of Citizens, and the Class A common stock
elects the remaining directors; and (b) each Class A share receives twice the
cash dividends paid on a per share basis to the Class B common stock.
3.3 CICA has complete and unrestricted power to enter into and,
upon the appropriate approvals as required by law, to consummate the
transactions contemplated by this Agreement. None of Citizens, and its
subsidiaries have any liability or obligation to pay any fee or commission to
any broker, agent or finder with respect to the transaction contemplated hereby
except to Merger & Acquisition Profiles, Inc.
3.4 Neither the making of nor the compliance with the terms and
provisions of this Agreement and consummation of the transactions contemplated
herein by CICA will conflict with or result in a breach or violation of the
Articles of Incorporation or Bylaws of CICA.
3.5 The execution, delivery and performance of this Agreement have
been duly authorized and approved by the Board of Directors of CICA.
3.6 CICA has delivered to American consolidated financial
statements of Citizens and its subsidiaries, dated December 31, 1995 and June
30, 1996. All such statements, herein sometimes called "Citizens Financial
Statements," are complete and correct in all material respects and, together
with the notes to these financial statements, present fairly the financial
position and results of operations of Citizens and its subsidiaries for the
periods included. The December 31, 1995 and June 30, 1996 Citizens consolidated
financial statements have been prepared in accordance with generally accepted
accounting principles.
3.7 Since the dates of the Citizens Financial Statements there
have not been any material adverse changes in the business or condition,
financial or otherwise, of Citizens. Citizens and its subsidiaries do not have
any material liabilities or obligations, secured or unsecured (whether accrued,
absolute, contingent or otherwise) except as disclosed in the Citizens
Financial Statement.
3.8 CICA has delivered to American a list and description of all
pending legal proceedings involving Citizens, none of which will materially
adversely affect it, and, except for these proceedings, there are no legal
proceedings or regulatory proceedings involving material claims pending, or to
the knowledge of the officers of Citizen, threatened against Citizens or
affecting any of its assets or properties, and Citizens is not in any material
breach or violation of or default under any contract or instrument to which
Citizens is a party, and no event has occurred which with the lapse of time or
action by a third party could result in a material breach or violation of or
default by Citizens under any contract or other instrument to which Citizens is
a party or by which it or any of its properties may be bound or affected, or
under its respective Articles of Incorporation or Bylaws, nor is there any
court or regulatory order pending, applicable to Citizens or its subsidiaries.
3.9 Citizens shall not enter into or consummate any transactions
prior to the Effective Date other than (i) in the ordinary course of business
or (ii) business acquisitions, combinations and exchanges. Citizens will not
pay any dividend or, except in the ordinary course of business, enter into an
agreement or transaction which would adversely affect its financial condition.
3.10 Neither CICA nor Citizens is a party to any contract
performable in the future except insurance policies, customary agent contracts,
normal reinsurance agreements, agreements with subsidiaries, and those which
will not adversely affect it.
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3.11 The representations and warranties of CICA shall be true and
correct as of the date hereof and as of the Effective date.
3.12 CICA has delivered, or will deliver within two weeks of the
date of this Agreement, to American true and correct copies of Citizens Annual
Report to Shareholders for the years ended December 31, 1995 and 1994. CICA
will also deliver to American on or before the Closing Date any reports
relating to the financial and business condition of Citizens which are filed
with the SEC after the date of this Agreement and any other reports sent
generally to its shareholders after the date of this Agreement. Citizens has
duly filed all reports required to be filed by it under the Securities Act of
1933, as amended, and the Securities Exchange Act of 1934, as amended (the
"Federal Securities Laws"). No such reports, or any reports sent to the
shareholders of Citizens generally as of their respective dates, contained any
untrue statement of material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements in such
reports, in light of the circumstances under which they were made, not
misleading.
3.13 CICA has delivered to American a copy of each of the
consolidated federal income tax returns of Citizens and its subsidiaries for
the year ended December 31, 1994 and for any additional open years. The
provisions for taxes paid by Citizens are believed by Citizens to be sufficient
for payment of all accrued and unpaid federal, state, county and local taxes of
Citizens (including any penalties or interest payable) whether or not disputed
for the periods then ended and for all prior fiscal periods. All returns and
reports or other information required or requested by federal, state, county,
and local tax authorities have been filed or supplied in a timely fashion, and
all such information is true and correct in all material respects. Provision
has been made for the payment of all taxes due to date by Citizens.
3.14 Citizens has no employee benefit plan, except for a
noncontributory, qualified profit-sharing plan and a group accident and health
insurance plan.
3.15 No representation or warranty by CICA in this Agreement, the
CICA Disclosure Statement or any certificate delivered pursuant hereto
contains any untrue statement of a material fact or omits to state any
material fact necessary to make such representation or warranty not misleading.
ARTICLE IV
Representations, Warranties and Covenants of American
No representations or warranties are made by any director, officer,
employee or shareholder of American as individuals, except as and to the extent
stated in this Agreement or in a separate written statement (the "American
Disclosure Statement"). American hereby represents, warrants and covenants to
CICA, except as stated in the American Disclosure Statement, as follows:
4.1 American and USLI are, respectively, a corporation and an
insurance company duly organized, validly existing and in good standing under
the laws of the State of Mississippi, each having the corporate power and
authority to own or lease its properties and to carry on its business as it is
now being conducted. The Articles of Incorporation and Bylaws of American and
USLI, copies of which have been delivered to CICA, are complete and accurate,
and the minute books of American and USLI contain a record, which is complete
and accurate in all material respects, of all meetings, and all corporate
actions of the shareholders and Board of Directors of American and USLI.
4.2 The aggregate number of shares which American is authorized to
issue is 15,000,000 shares of Class A common stock, participating, no par
value, and 2,500 shares of Class B Common Stock,
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participating (by virtue of a 1994 amendment to the Articles of Incorporation),
$1.00 par value; of which 5,025,490 shares of such Class A Common Stock are
issued and 5,021,764 are outstanding, fully paid and nonassessable and 2,500
shares of Class B Common Stock are issued and outstanding, fully paid and
nonassessable. American has no outstanding options, warrants or other rights to
purchase or subscribe to, or securities convertible into or exchangeable for
any shares of capital stock, except as shown on the American Disclosure
Statement attached to and made a part of this Agreement. There are 3,726 shares
of Class A common stock owned and held by USLI.
The aggregate number of shares which USLI is authorized to issue is
4,000 shares of Common Stock, participating, $500.00 par value, of which 2,000
shares are issued and outstanding, fully paid and nonassessable. USLI has no
outstanding options, warrants or other rights to purchase or subscribe to, or
securities convertible into or exchangeable for any shares of capital stock.
All issued and outstanding shares of USLI stock are owned and held by American.
The subsidiaries of American are each an association, corporation, or
other entity duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation or association; each has the
power and authority to lease its properties and to carry on its business as now
being conducted and is qualified to do business; and each holds or shall hold
all licenses, franchises, permits or other governmental authorizations required
to enable it to conduct its business or own its properties in every
jurisdiction in which it currently conducts business or owns property and where
the failure to do so would have a material adverse effect on the business of
the subsidiary. All outstanding shares of capital stock of each subsidiary are
duly and validly authorized and issued, fully paid and nonassessable. American
directly or indirectly owns all of the issued and outstanding capital stock of
such subsidiaries, including USLI. There are no outstanding options, warrants
or other rights to purchase or subscribe to, or securities convertible into or
exchangeable for any shares of capital stock of any subsidiary of American or
USLI, except as shown on the American Disclosure Statement.
4.3 American and USLI each have complete and unrestricted power to
enter into and, upon the appropriate approvals as required by law, to
consummate the transactions contemplated by this Agreement. None of American
and its subsidiaries have any liability or obligation to pay any fee or
commission to any broker, agent or finder with respect to the transactions
contemplated hereby.
4.4 Neither the making of nor the compliance with the terms and
provisions of this Agreement and consummation of the transaction contemplated
herein by American will conflict with or result in a breach or violation of any
Articles of Incorporation or Bylaws of American or its subsidiaries.
4.5 The execution of this Agreement has been duly authorized and
approved by American's Board of Directors.
4.6 American has delivered to CICA consolidated financial
statements of American and its subsidiaries, dated December 31, 1995 and June
30, 1996, and the annual and quarterly convention statements of USLI as of
December 31, 1995 and the six months ended June 30, 1996, as filed with the
Mississippi Department of Insurance. All such statements, herein sometimes
called "American Financial Statements," are complete and correct in all
material respects and, together with the notes to these financial statements,
present fairly the financial position and results of operations of American and
USLI for the periods indicated. The December 31, 1995 and June 30, 1996
American consolidated financial statements have been prepared in accordance
with generally accepted accounting principles and the December 31, 1995 and
June 30, 1996 convention statements have been prepared in accordance with
statutory accounting practices.
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4.7 Since the dates of the American Financial Statements there
have not been any material adverse changes in the business or condition,
financial or otherwise, of American or any of its subsidiaries. None of
American or its subsidiaries have any material liabilities or obligations,
secured or unsecured (whether accrued, absolute, contingent or otherwise),
except as disclosed in the American Financial Statements
4.8 American has delivered to CICA a list and description of all
pending legal proceedings involving American or any of its subsidiaries, all of
which are listed on the American Disclosure Statement, none of which will
materially adversely affect American or such subsidiary, and, except for these
proceedings, there are no legal proceedings or regulatory proceedings involving
material claims pending, or to the knowledge of the officers of American,
threatened against American or USLI or affecting any of its assets or
properties, and American and USLI are not in any material breach or violation
of or default under any contract or instrument to which American or USLI is a
party, and no event has occurred which with the lapse of time or action by a
third party could result in a material breach or violation of or default by
American or USLI under any contract or other instrument to which American or
USLI is a party or by which either of them or any of their respective
properties may be bound or affected, or under their respective Articles of
Incorporation or Bylaws, nor is there any court or regulatory order pending,
applicable to American or USLI.
4.9 Neither American nor USLI shall enter into or consummate any
transactions prior to the Effective Date other than in the ordinary course of
business and will pay no dividend, or increase the compensation of officers and
will not enter into any agreement or transaction which would adversely affect
their financial condition in a material manner.
4.10 The assets of USLI had admissible values at least equal to
those attributed to them on its December 31, 1995 or June 30, 1996 convention
statements.
4.11 Neither American nor USLI nor any subsidiary of American or
USLI is a party to any contract performable in the future except insurance
policies, customary agent contracts, normal reinsurance agreements and those
which will not adversely affect them, except as set out on the American
Disclosure Statement attached to this Agreement.
4.12 All policy and claim reserves of USLI have been properly
provided for and are adequate to comply with all regulatory requirements
regarding same.
4.13 The representations and warranties of American shall be true
and correct as of the date hereof and as of the Effective Date.
4.14 American has delivered, or will deliver within two weeks of
the date of this Agreement, to CICA true and correct copies of American's
Annual Report to Shareholders for the years ended December 31, 1995 and 1994
and each of its other reports to shareholders and filings with the Securities
and Exchange Commission ("SEC") for the years ended December 31, 1995, 1994 and
1993. American will also deliver to CICA on or before the Closing Date any
reports relating to the financial and business condition of American which are
filed with the SEC after the date of this Agreement and any other reports sent
generally to its shareholders after the date of this Agreement. American has
duly filed all reports required to be filed by it under the Securities Act of
1933, as amended, and the Securities Exchange Act of 1934, as amended (the
"Federal Securities Laws"). No such reports, or any reports sent to the
shareholders of American generally, contained any untrue statement of material
fact or omitted to state any material fact required to be stated therein or
necessary to make the statements in such report, in light of the circumstances
under which they were made, not misleading.
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4.15 American has delivered to CICA a copy of each of the federal
income tax returns of American for the years ended December 31, 1995, 1994 and
1993 and for any additional open years. The provisions for taxes paid by
American are believed by American to be sufficient for payment of all accrued
and unpaid federal, state, county and local taxes of American (including any
penalties or interest payable) whether or not disputed for the periods then
ended and for all prior fiscal periods. All returns and reports or other
information required or requested by federal, state, county and local tax
authorities have been filed or supplied in a timely fashion, and all such
information is true and correct in all material respects. Provision has been
made for the payment of all taxes due to date by American.
4.16 Neither American nor USLI have any employee benefit plans,
except for a noncontributory 401K plan and a group accident, health and life
insurance plans.
4.17 No representation or warranty by American in this Agreement,
the American Disclosure Statement or any certificate delivered pursuant hereto
contains any untrue statement of a material fact or omits to state any material
fact necessary to make such representation or warranty not misleading.
ARTICLE V
Obligations of the Parties Pending the Effective Date
5.1 This Agreement shall be duly submitted to the shareholders of
American for the purpose of considering and acting upon this Agreement in the
manner required by law at a meeting of shareholders on a date selected by
American, such date to be the earliest practicable date after the proxy
statement may first be sent to American shareholders without objection by
applicable governmental authorities. CICA will furnish to American the
information relating to Citizens required by the Federal Securities Laws to be
included in the proxy statement. CICA represents and warrants that at the time
of the American shareholders' meeting, the proxy statement, insofar as it
relates to Citizens and contains information furnished by CICA specifically for
use in such proxy statement, (a) will comply in all material respects with the
provisions of the Federal Securities Laws; and (b) will not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. The Board of
Directors of American, subject to its fiduciary obligations to shareholders,
shall use its best efforts to obtain the requisite approval of American
shareholders of this Agreement and the transactions contemplated herein.
American and CICA shall take all reasonable and necessary steps and actions to
comply with and to secure American shareholders approval of this Agreement and
the transactions contemplated herein as may be required by the statutes, rules
and regulations of such states.
5.2 At all times prior to the Effective Date, during regular
business hours each party will permit the other to examine its books and
records and the books and records of any subsidiaries and will furnish copies
thereof on request. It is recognized that, during the performance of this
Agreement, each party may provide the other parties with information which is
confidential or proprietary information. During the term of this Agreement, and
for four years following the termination of this Agreement, the recipient of
such information shall protect such information from disclosure to persons,
other than members of its own or affiliated organizations and its professional
advisors in the same manner as it protects its own confidential or proprietary
information from unauthorized disclosure, and not use such information to the
competitive detriment of the disclosing party. In addition, if this Agreement
is terminated for any reason, each party shall promptly return or cause to be
returned all documents or other written records of such confidential or
proprietary information, together with all copies of such writings and, in
addition, shall either furnish or cause to be furnished, or shall destroy, or
shall maintain with such standard of care as is exercised with respect to its
own confidential or proprietary information, all copies of all documents or
other written records developed or prepared by such party on the basis of such
confidential or proprietary information.
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No information shall be considered confidential or proprietary if it is (a)
information already in the possession of the party to whom disclosure is made;
(b) information acquired by the party to whom the disclosure is made from other
sources; or (c) information in the public domain or generally available to
interested persons or which at a later date passes into the public domain or
becomes available to the party to whom disclosure is made without any
wrongdoing by the party to whom the disclosure is made.
5.3 American and CICA shall promptly provide each other with
information as to any significant developments in the performance of this
Agreement, and shall promptly notify the other if it discovers that any of its
representations, warranties and covenants contained in this Agreement or in any
document delivered in connection with this Agreement was not true and correct
in all material respects or became untrue or incorrect in any material respect.
5.4 All parties to this Agreement shall take all such action as
may be reasonably necessary and appropriate and shall use their best efforts in
order to consummate the transactions contemplated hereby as promptly as
practicable.
ARTICLE VI
Procedure for Exchange
6.1 As soon as practical and in any event within 30 days after the
Execution of this Agreement, the parties shall file with the Insurance
Commissioner of Mississippi all of the documents required by Mississippi law.
ARTICLE VII
Conditions Precedent to the Consummation of the Exchange
The following are conditions precedent to the consummation of the
Agreement on or before the Effective Date:
7.1 CICA and American shall have performed and complied with all
of their respective obligations hereunder which are to be complied with or
performed on or before the Effective Date and American and CICA shall provide
one another at the Closing with a certificate to the effect that such party has
performed each of the acts and undertakings required to be performed by it on
or before the Closing Date pursuant to the terms of this Agreement.
7.2 This Agreement and the transactions contemplated herein shall
have been duly and validly authorized, approved and adopted, at a meeting of
the shareholders of American duly and properly called for such purposes in
accordance with the applicable laws.
7.3 This Agreement is in all things subject to the provisions of
the applicable insurance laws and the regulations promulgated thereunder, and
shall not become effective until all necessary approvals are obtained from the
Commissioners of Insurance of the States of Colorado and Mississippi in
accordance with the provisions of the laws of said states. CICA and American as
soon as practical after the execution and delivery of this Agreement, agree to
file and to use their best efforts to obtain such approvals of the transactions
contemplated by this Agreement. Neither CICA nor American shall be obligated to
file a suit or to appeal from any Commissioner's adverse ruling, nor shall CICA
or American be obligated to make any material changes in any lawful, good faith
management policy in order to gain such approval. In the event either approval
is denied, this Agreement shall terminate.
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7.4 No action, suit or proceeding shall have been instituted or
shall have been threatened before any court or other governmental body or by
any public authority to restrain, enjoin or prohibit the transactions
contemplated herein, or which might subject any of the parties hereto or their
directors or officers to any material liability, fine, forfeiture or penalty on
the grounds that the transactions contemplated hereby, the parties hereto or
their directors or officers, have violated any applicable law or regulation, or
have otherwise acted improperly in connection with the transactions
contemplated hereby, and the parties hereto have been advised by counsel that,
in the opinion of such counsel, such action, suit or proceeding raises
substantial questions of law or fact which could reasonably be decided
adversely to any party hereto or its directors or officers.
7.5 All actions, proceedings, instruments and documents required
to carry out this Agreement and the transactions contemplated hereby and the
form and substance of all legal proceedings and related matters shall have been
approved by counsel for CICA and American.
7.6 The representations and warranties by CICA and American in
this Agreement shall be true as though such representations and warranties had
been made or given on and as of the Effective Date, except to the extent that
such representations and warranties may be untrue on and as of the Effective
Date because of (1) changes caused by transactions suggested or approved in
writing by CICA; or (2) events or changes (which shall not in the aggregate,
have materially and adversely affected the business, assets, or financial
condition of American or Citizens) during or arising after the date of this
Agreement.
7.7 American shall have furnished CICA with:
(1) a certified copy of a resolution or resolutions duly
adopted by the Board of Directors of American
approving this Agreement and the transactions
contemplated by it in accordance with applicable law
and directing the submission thereof to a vote of the
shareholders of American;
(2) a certified copy of a resolution or resolutions duly
adopted by the shareholders of American approving
this Agreement and the transactions contemplated by
it in accordance with applicable law;
(3) an opinion of Spencer, Tyra & Crecink, counsel for
American, dated as of the Closing Date as set forth
in "Exhibit B" attached hereto;
(4) an agreement from each "affiliate" of American as
defined in the rules adopted under the Securities Act
of 1933, as amended, to the effect that (a) the
affiliate is familiar with SEC Rule 144; (b) none of
the shares of Citizens Class A common stock will be
transferred by or through the affiliate in violation
of the Federal Securities Laws; (c) the affiliate
will not sell or in any way reduce his risk relative
to any Citizens Class A common stock received
pursuant to this Agreement until such time as
financial results covering at least 30 days of
post-closing date combined operations shall have been
published by Citizens on SEC Form 10-Q or otherwise.
7.8 CICA shall furnish American with:
(1) a certified copy of a resolution or resolutions duly
adopted by the Board of Directors approving this
Agreement and the transactions contemplated by it;
and
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(2) an opinion dated the Effective Date of Jones &
Keller, P.C., counsel for CICA, as set forth in
"Exhibit C" attached hereto.
ARTICLE VIII
Termination and Abandonment
8.1 Anything contained in this Agreement to the contrary
notwithstanding, the Agreement may be terminated and abandoned at any time
(whether before or after the approval and adoption thereof by the shareholders
of American and/or CICA) prior to the Effective date.
(a) By mutual consent of the Boards of Directors of CICA
and American:
(b) By CICA or American, if any condition set forth in
Article VII relating to the other party has not been
satisfied or has not been waived;
(c) By CICA or American, if any suit, action or other
proceeding shall be pending or threatened by the
federal or a state government before any court or
governmental agency, in which it is sought to
restrain, prohibit or otherwise affect the
consummation of the transactions contemplated hereby;
(d) By any party, if there is discovered any material
error, misstatement or omission in the
representations and warranties of another party; or
(e) By CICA, if dissenters' rights are perfected in
accordance with the Exchange Act for more than 2.5 of
the outstanding shares of American; or
(f) By either party if the Effective Date does not occur
within ninety (90) days from the date hereof.
(g) By any party, if it is determined by counsel of
either party that the transaction will not constitute
a reorganization within the meaning of Section 368(a)
of the Internal Revenue Code of 1986, as amended.
8.2 Any of the terms or conditions of the Agreement may be waived
at any time by the party which is entitled to the benefit thereof, by action by
its Board of Directors; provided, however, that such action shall be taken only
if, in the judgment of the Board of Directors taking the action, such waiver
will not have a materially adverse effect on the benefits intended under this
Agreement to the party waiving such term or condition.
ARTICLE IX
Termination of Representation and
Warranties and Certain Agreements
9.1 The respective representations and warranties of the parties
hereto shall expire with, and be terminated and extinguished by consummation of
the Agreement; provided, however, that the covenants and agreements of the
parties hereto shall survive in accordance with their terms.
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ARTICLE X
Miscellaneous
10.1 This Agreement embodies the entire agreement between the
parties, and there have been and are no agreements, representations or
warranties among the parties other than those set forth herein or those
provided for herein.
10.2 To facilitate the execution of this Agreement, any number of
counterparts hereof may be executed, and each such counterpart shall be deemed
to be an original instrument, but all such counterparts together shall
constitute but one instrument.
10.3 Each of the parties hereto will pay its own fees and expenses
incurred in connection with the transactions contemplated by this Agreement.
Except as otherwise disclosed in their respective Disclosure Statements, CICA
and American each represent to the other that it has not employed any
investment bankers, brokers, finders, or intermediaries in connection with the
transaction contemplated hereby who might be entitled to any fee or other
payment from American or Citizens or any of their respective subsidiaries upon
consummation of the transactions contemplated by this Agreement.
10.4 All parties to this Agreement agree that if it becomes
necessary or desirable to execute further instruments or to make such other
assurances as are deemed necessary, the party requested to do so will use its
best efforts to provide such executed instruments or do all things necessary of
proper to carry out the purpose of this Agreement.
10.5 This Agreement may be amended upon approval of the Board of
Directors of each party provided that the share exchange ratio hereunder shall
not be amended without approval of the requisite shareholders of American.
10.6 Any notices, requests, or other communications required or
permitted hereunder shall be delivered personally or sent by overnight courier
service, fees prepaid, addressed as follows:
To CICA, Inc.: and to American:
Citizens Insurance Company American Investment Network, Inc.
of America United Security Life Insurance
Post Office Box 149151 Company
Austin, Texas 78714-9159 660 Lakeland East Drive
Attn: Harold E. Riley Flowood, Mississippi 39208
Chairman Attn: John S. Camara, President
Phone: (512) 837-7100 Phone: (601) 936-2090
Fax: (512) 836-9334 Fax: (691) 939-4372
with copies to: with copies to:
Jones & Keller, P.C. Spencer, Tyra & Crecink
1625 Broadway, Ste 1600 660 Lakeland East Drive, Ste 100
Denver, Colorado 80202 Jackson, Mississippi 39208
Attn: Reid A. Godbolt, Esq. Attn: Ernest O. Spencer, III, Esq.
Phone: (303) 573-1600 Phone: (601) 939-9193
Fax: (303) 573-0769 Fax: (601) 939-9195
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or such other addresses as shall be furnished in writing by any party, and any
such notice or communication shall be deemed to have been given as of the date
received.
10.7 No press release or public statement will be issued relating
to the transactions contemplated by this Agreement without prior approval of
CICA and American. However, either CICA or American may issue at any time any
press release or other public statement it believes on the advise of its
counsel it is obligated to issue to avoid liability under the law relating to
disclosures to itself or any of its affiliates, but the party issuing such
press release or public statement shall make a reasonable effort to give the
other party prior notice of and opportunity to participate in h release or
statement.
10.8 The parties have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any of the provisions of
this Agreement. Any references to any federal, state, local, or foreign statute
or law shall be deemed also to refer to all rules and regulations promulgated
thereunder, unless the context otherwise requires. The word "including" shall
mean including without limitation.
10.9 The Exhibits and Schedules identified in this Agreement are
incorporated herein by reference and made a part hereof.
10.10 This Agreement shall be governed by and construed in
accordance with the domestic laws of the State of Mississippi without giving
effect to any choice or conflict of law provision or rule (whether of the State
of Mississippi or any other jurisdiction) that would cause the application of
the laws or any jurisdiction other than the State of Mississippi.
IN WITNESS WHEREOF, the parties have set their hands and seals this
28th day of October, 1996.
CITIZENS INSURANCE COMPANY AMERICAN INVESTMENT NETWORK,
OF AMERICA INC.
By:/s/ Mark A. Oliver By:/s/ John S. Camara
------------------- -------------------
Mark A. Oliver John S. Camara, President
Executive Vice-President
and Treasurer
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EXHIBIT A
OFFICE OF THE MISSISSIPPI SECRETARY OF STATE
P.O. BOX 136, JACKSON, MS 39205-0135, (601) 359-1333
ARTICLES OF MERGER OR SHARE EXCHANGE
PROFIT CORPORATION
The undersigned corporation pursuant to Section 79-1-1.05, as amended, hereby
executes the following document and sets forth:
1. Name of Corporation 1: American Investment Network, Inc.
2. Name of Corporation 2: Citizens Insurance Company of America.
3. Name of Corporation 3:
4. The future effective date is January 1, 1997.
5. The plan of merger or share exchange (attach page).
6. Mark appropriate box.
(a) Shareholder approval of the plan of merger or share exchange
- ------ was not required.
X (b) If approval of the shareholders of one or more corporations
- ------ party to the merger or share exchange was required
(i) the designation, number of outstanding shares, and number
of votes entitled to be cast by each class entitled to vote
separately on the plan as to each corporation were
Name of corporation Designation No. of outstanding shares No. of votes entitled to be cast
- ------------------------------------------------------------------------------------------------------------------------------------
American Investment Class A Common
Network, Inc. Stock 5,021,764 5,021,764
American Investment Class B Common
Network, Inc. Stock 2,500 2,500
AND the total number of votes cast for and against the plan by each class entitled to vote separately on the plan was
Name of corporation Class Total No. of votes cast for plan No. of votes cast against plan
- ------------------------------------------------------------------------------------------------------------------------------------
American Investment Class A Common
Network, Inc. Stock
American Investment Class B Common
Network, Inc. Stock
and the number of votes cast for the plan by each class was sufficient for
approval by that class.
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Name of Corporation 1
AMERICAN INVESTMENT NETWORK, INC.
By:/s/ John S. Camara
- --------------------------------------
President
Name of Corporation 2
AMERICAN INVESTMENT NETWORK, INC.
By:/s/ Mark A. Oliver
- --------------------------------------
Executive Vice President and Treasurer
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ATTACHMENT TO ARTICLES OF SHARE EXCHANGE
OF
AMERICAN INVESTMENT NETWORK, INC.
AND
CITIZENS INSURANCE COMPANY OF AMERICA
In accordance with Mississippi Code Ann. 79-4-11.01 et seq. and
83-19-99 et. seq. (together the "Exchange Act"), a plan and agreement of
exchange ("Plan of Exchange") has been approved, adopted and executed by
American Investment Network, Inc. and Citizens Insurance Company of America as
follows:
1. The Exchange shall be effective as of January 1, 1997
("Effective Date").
2. At and as of the Effective Date:
(a) each shareholder of American prior to the Effective
Date shall cease to be a shareholder of American:
(b) the ownership of all issued and outstanding stock of
American (other than shares for which dissenter's rights are
perfected in accordance with the Exchange Act) shall vest in
CICA automatically without any physical transfer or deposit of
the certificates representing such shares, and CICA will
become the sole shareholder of American;
(c) the holders of each issued and outstanding share of
American Class A or Class B Common Stock prior to the
Effective Date (other than any shares for which dissenter's
rights are perfected in accordance with the Exchange Act)
shall have the right to receive from CICA in accordance with
Article II of the Plan of Exchange one (1) share of Citizens
Class A common stock, no par value, for each seven and
two-tenths (7.2) shares of American Class A or Class B Common
Stock; provided, however, that all consideration to be
received shall be subject to equitable adjustment in the event
of any stock split, stock dividend, reverse stock split, or
other change in the number of American shares outstanding; and
(d) the holders of each issued and outstanding share of
American Class A or Class B Common Stock prior to the
Effective Date for which dissenter's rights are perfected in
accordance with the Exchange Act shall have the right to
receive from American payment therefor in accordance with the
Exchange Act.
3. The Exchange shall have the effect set forth in the Exchange
Act.
4. The Plan of Share Exchange has been approved by the
Shareholders of American. No shareholder approval by the shareholders CICA,
Colorado stock insurance company, was required, pursuant to Section
7-111-103(7) of the Colorado Business Corporation Act and Sections 79-4-11.01
et seq. of the Mississippi Code of 1972, as amended.
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ARTICLES OF SHARE EXCHANGE
Pursuant to the provisions of the Colorado Business Corporation Act,
AMERICAN INVESTMENT NETWORK, INC., a Mississippi corporation ('American"), and
CITIZENS INSURANCE COMPANY OF AMERICA, a stock insurance company organized
under the laws of the State of Colorado ("CICA"), adopt the following articles
of share exchange:
FIRST: The plan of share exchange (the "Plan of Exchange") is
summarized as follows: At and as of the effective time set forth below (the
"Effective Date"):
(a) each shareholder of American Prior to the Effective
Date shall cease to be a shareholder of American;
(b) the ownership of all issued and outstanding stock of
American (other than shares for which dissenter's rights are perfected
in accordance with applicable law) shall vest in CICA automatically
without any physical transfer or deposit of the certificates
representing such shares, and CICA will become the sole shareholder of
American;
(c) the holders of each issued and outstanding share of
American Class A or Class B Common Stock prior to the Effective Date
(other than any shares for which dissenter's rights are perfected in
accordance with applicable law) shall have the right to receive form
CICA in accordance with Article II of the Plan of Exchange one (1)
share of Citizens Class A common stock, no par value, for each seven
and two-tenths (7.2) shares of American Class A or Class B Common
Stock; provided, however, that all consideration to be received shall
be subject to equitable adjustment in the event of any stock split,
stock dividend, reverse stock split, or other change in the number of
American shares outstanding; and
(d) the holders of each issued and outstanding share of
American Class A or Class B Common Stock prior to the Effective Date
for which dissenter's rights are perfected in accordance with
applicable law shall have the right to received from American payment
therefor in accordance with applicable law.
SECOND: The plan of share exchange was approved by the shareholders of
American. Approval by the shareholders of CICA was not required.
THIRD: As to American, whose shareholders were required to vote for
approval, the number of votes cast for the plan by each voting group entitled
to vote separately on the share exchange was sufficient for approval by that
voting group.
FOURTH: These articles are to become effective on January 1, 1997 at
12:01 a.m., unless prior to the effective date they are abandoned and a
statement of abandonment if filed prior to the effective date.
Dated: __________, 1996
AMERICAN INVESTMENT NETWORK, INC. CITIZENS INSURANCE COMPANY
OF AMERICA, INC.
By: By:
------------------------------ --------------------------------
Title: President Title: Executive Vice President
and Treasurer
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EXHIBIT B
Opinion of Counsel for American
At the Closing, American shall deliver to CICA an opinion, in form and
substance satisfactory to CICA and its counsel, dated the Closing Date, of
Spencer, Tyra & Crecink, counsel to American, to the effect that:
(i) The execution, delivery, and performance of the Agreement by
American shall not result in a breach of, or constitute a
default (or an event which, with or without notice or lapse of
time or both, would constitute a default) under any contract,
commitment, agreement, indenture, mortgage, pledge agreement,
note, bond, license, or other instrument or obligation to
which American is a party or by which American is bound or the
charter or bylaws of American or other governing instruments
of American
(ii) The Agreement has been duly authorized, executed and delivered
by American and is a legal, valid and binding obligation of
American enforceable against American in accordance with its
terms (subject to the applicability of equitable principles or
the effect of bankruptcy or creditors' rights laws on the
enforceability of the Agreement);
(iii) American and USLI are, respectively, a corporation and a stock
insurance company duly organized, validly existing and in good
standing under the laws of the State of Mississippi;
(iv) American has full corporate power and authority to enter into
Agreement and to carry out the transactions contemplated by
the Agreement;
(v) To such counsel's knowledge, after due inquiry, there are no
civil or criminal actions, suits, arbitrations, administrative
or other proceedings or governmental investigations pending or
threatened against American or its subsidiaries which will
constitute a breach of the representations, warranties or
covenant under the Agreement or will prevent American from
consummating the transactions contemplated by the Agreement;
(vi) The authorized and outstanding capital stock of American and
USLI are as stated in Section 4.2 of the Agreement, and such
shares have been duly authorized, are fully paid and
nonassessable and were not issued in violation of the
preemptive rights of any party;
(vii) To such counsel's knowledge, after due inquiry, except as set
forth in the Agreement, there are no outstanding
subscriptions, options, warrants, rights, convertible
securities, calls, commitments, privileges or other
arrangements, preemptive or contractual, calling for or
requiring the acquisition of, or the issuance, transfer, sale,
or other disposition of any shares of the capital stock of
American or USLI, or calling for or requiring the issuance of
any securities or rights convertible into or exchangeable for
shares of capital stock of American or USLI, except as
disclosed in the Agreement; and
(viii) The execution, delivery, and performance of the Agreement, and
the performance by American of its obligations thereunder, is
not in contravention of any law, ordinance, rule, or
regulation, or contravene any order, writ, judgment,
injunction, decree, determination, or award of any court or
other authority having jurisdiction, will not cause the
suspension or revocation of any authorization, consent,
approval, or license, presently in effect, which affects or
binds, American, USLI or any of their material properties.
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EXHIBIT C
Opinion of Counsel for CICA
At the Closing, CICA shall deliver to American, an opinion, in form
and substance satisfactory to American and its counsel, dated the Closing Date,
of Jones & Keller, P.C., counsel to CICA, to the effect that:
(i) The execution, delivery, and performance of the Agreement by
CICA shall not result in a breach of, or constitute a default
(or an event which, with or without notice or lapse of time or
both, would constitute a default) under any contract,
commitment, agreement, indenture, mortgage, pledge agreement,
note, bond, license, or other instrument or obligation to
which CICA is a party or by which CICA is bound or the charter
or bylaws of CICA or other governing instruments of CICA;
(ii) The Agreement has been duly authorized, executed and delivered
by CICA and is a legal, valid and binding obligation of CICA
enforceable against CICA in accordance with its terms (subject
to the applicability of equitable principles or the effect of
bankruptcy or creditors' rights laws on the enforceability of
the Agreement);
(iii) Citizens and CICA respectively are a corporation and a stock
insurance company, duly organized, validly existing and in
good standing under the laws of the State of Colorado;
(iv) CICA has full corporate power and authority to enter into the
Agreement and to carry out the transactions contemplated by
the Agreement;
(v) To such counsel's knowledge, after due inquiry, there are no
civil or criminal actions, suits, arbitrations, administrative
or other proceedings or governmental investigations pending or
threatened against CICA which will constitute a breach of the
representations, warranties or covenants under the Agreement
or will prevent CICA from consummating the transactions
contemplated by the Agreement;
(vi) The authorized and outstanding capital stock of Citizens is as
stated in Section 3.2 of the Agreement, and each of the shares
of Class A common stock to be issued pursuant to the agreement
has been duly authorized and when issued pursuant to the terms
of the Agreement shall be validly issued and fully paid and
non-assessable and issued in violation of the preemptive
rights of any party;
(vii) To such counsel's knowledge, after due inquiry, except as set
forth in the Agreement or CICA's Disclosure Statement, there
are no outstanding subscriptions, options, warrants, rights,
convertible securities, calls, commitments, privileges or
other arrangements, preventive or contractual, calling for or
requiring the acquisition of, or the issuance, transfer, sale,
or other disposition of any shares of the capital stock of
Citizens, or calling for or requiring the issuance of any
securities or rights convertible into or exchangeable for
shares of capital stock of Citizens;
(viii) The execution, delivery, and performance of the Agreement, and
the performance by CICA of its obligations thereunder, is not
in contravention of any law, ordinance, rule, or regulation,
or contravene any order, writ, judgment, injunction, decree,
determination, or award of any court or other authority having
jurisdiction, will not cause the suspension or revocation of
any authorization, consent, approval, or license presently in
effect, which affects or binds CICA or any of its subsidiaries
or any of its or their material properties;
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(xi) Consummation of the transaction in accordance with the terms
of the Agreement will constitute a reorganization within the
meaning of the Internal Revenue Code of 1986, as amended (the
"Code"); American and CICA will each be a party to the
reorganization; no gain or loss will be recognized pursuant to
the Code by American as a consequence of the transactions
contemplated hereby; CICA will succeed to and take into
account the items of American described in the Code; when a
American shareholder receives solely Citizens Class A common
stock in accordance with the transactions contemplated hereby,
such American shareholder will not recognize gain or loss; the
basis for the Citizens Class A common stock to be received by
American shareholders will be the same as the basis for the
shares of American stock they surrender in connection with the
transactions contemplated hereby; the holding period for any
American shareholder of the Citizens Class A common stock
received in the transactions contemplated hereby will include
the period during which the shares of the American stock
surrendered were held provided that the American stock was a
capital asset in the hands of such American shareholder on the
Effective Date; and the payment of cash to any American
shareholder in lieu of a fractional share of Citizens Class A
common stock will be treated as received as a distribution and
redemption of the fractional share interest, subject to the
limitations of Section 302 of the Code; and
(x) The exchange of Citizens Class A common stock for shares of
American stock is exempt from registration under the
Securities Act of 1933, as amended, pursuant to Section
3(a)(10) thereof and, with respect to state securities laws
and the securities laws of other applicable jurisdictions, if
any, is either exempt from qualification or registration
thereunder or such qualification or registration requirements
have been satisfied.
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CICA DISCLOSURE STATEMENT
Pursuant to the provisions of Article III of the Plan and Agreement of
Exchange between and among CICA and American, CICA hereby makes the following
disclosures respecting the similarly numbered sections in the Plan and
Agreement of Exchange:
3.3 At the Effective Date, brokerage commissions will be owed to
Merger & Acquisition Profiles, Inc.
3.7 Citizens has the liabilities disclosed in the Citizens
Financial Statements and those incurred thereafter in the
ordinary course of business.
3.10 Computer Maintenance Agreement between Computing Technology,
Inc. and Wang Laboratories, effective 7/1/91 and amended
8/26/91.
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AMERICAN DISCLOSURE STATEMENT
Pursuant to the provisions of Article IV of the Plan and Agreement of
Exchange between and among CICA and American, American hereby makes the
following disclosures respecting the similarly numbered sections in the Plan
and Agreement of Exchange:
4.2 Outstanding warrants, options, or other rights to purchase or
subscribe to, or securities convertible into, or exchangeable
for, shares of capital stock of American:
(1) Stock Incentives issued to certain key employees of
Great American Investment Network, Inc. and USLI
pursuant to the 1994 Stock Incentive Plan, adopted by
the Board of Directors on November 30, 1994, and
approved by the Shareholders on May 3, 1994.
4.7 American has liabilities disclosed in their financial
statements and those incurred thereafter in the ordinary
course of business.
4.8 Pending litigation: As of the date of execution hereof, the
following litigation against American and/or USLI was ending:
(1) David Anderson and Marty Stanford, D/B/A Premiere
Insurance Agency, and Chiropractic National
Association, Plaintiffs, versus United Security Life
Insurance Company, Defendant, Civil Action No.
96-002(r)L, in the Circuit Court of Lee County,
Mississippi.
(2) Donald and Karen Mayo, Plaintiffs, versus United
Security Life Insurance Company, Defendant, Civil
Action No. 95-268(f)L, in the Circuit Court of Lee
County, Mississippi.
4.11 American is subject to the following contracts and agreements
which are, or may be, performable in the future, copies of
which have heretofore been furnished to CICA:
(1) Settlement Agreement dated March 2, 1995, among
Robert Tillman and Tillman Insurance Agency, Inc.
("Plaintiffs"), and The Gain Agency, Inc., Great
American Investment Network, Inc., Walter L. Shelton
and Jesse Byrd (Defendants).
(2) Executive Compensation Plan and Agreement adopted
November 11, 1994 by the Directors, and approved by
the Shareholders on May 2, 1995, between Great
American Investment Network, Inc. and Walter L.
Shelton and Jesse L. Byrd.
(3) Employment Agreement dated August 23, 1996, between,
American, USLI and John S. Camara.
(4) Employment Agreement dated August 23, 1996, between,
American, USLI and H. Harold Crumpler.
(5) Employment Agreement dated August 23, 1996, between,
American, USLI and Phillip E. Faller.
(6) Employment Agreement dated August 23, 1996, between,
American, USLI and Linda M. Pepper.
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(7) Contract Agreements between Great American Investment
Network, Inc. and the individual members of Magnolia
Consulting Group, an unincorporated
(8) Promissory Note dated December 19, 1994, in favor of
Merchants and Farmers Bank, in the original principal
amount of $535,562.62, with a final maturity date of
December 15, 1999. The Promissory Note is secured by
a Deed of Trust between the parties dated as of the
same date, and recorded in the Office of the Chancery
Clerk of Rankin County, Mississippi in Book 1018 at
Page 89.
(9) Second Deed of Trust dated March 2, 1995, securing
the Settlement Agreement referenced as Item No. (1),
above, among Great American Investment Network, Inc.,
Mark T. Davis as Trustee, and Dale Hubbard, Tillman
Insurance Agency, Inc. and Robert Tillman,
beneficiaries. This instrument is recorded in the
Office of the Chancery Clerk of Rankin County,
Mississippi in Book 1031 at Page 649.
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