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EXHIBIT 10.7
PLAN AND AGREEMENT OF MERGER
This Plan and Agreement of Merger ("Agreement") is entered into between
AMERICAN LIBERTY FINANCIAL CORPORATION, a corporation organized under the laws
of the State of Louisiana ("ALFC"), and CITIZENS, INC., a corporation organized
under the laws of the State of Colorado ("Citizens").
WITNESSETH
WHEREAS, Citizens and ALFC, a subsidiary of Citizens, desire to
streamline operations and corporate structure by merging ALFC into Citizens;
NOW, THEREFORE, the parties agree as follows.
ARTICLE I
The Merger
1.1 Subject to the terms and conditions set forth herein, ALFC will
be merged into Citizens (the "Merger") with Citizens being the corporation
surviving the Merger (the "Surviving Corporation"). The Articles of Merger and
Certificate of Merger, in the forms attached hereto subject to any
modifications as may be authorized or required in accordance with applicable
law (collectively the "Merger Filings"), shall be completed, executed and filed
as contemplated by this Agreement as soon as possible after all regulatory and
shareholder approvals are obtained in accordance with law.
1.2 The effect of the Merger shall be as follows:
(i) The Merger shall become effective (the
"Effective Time") upon the later of (i) the approval and
filing of the Merger Filings by and with the Departments
of Insurance and Secretaries of State of Colorado and
Louisiana, or (ii) the time and date specified in such
Merger Filings.
(ii) The Articles of Incorporation and Bylaws of
Citizens shall be the Articles of Incorporation and Bylaws
of the Surviving Corporation. The directors and officers
of Citizens shall be the directors and officers of the
Surviving Corporation.
(iii) At and as of the Effective Time, (a) all
treasury and outstanding shares of capital stock of ALFC
shall be canceled regardless of actual surrender of the
certificates therefor, and (b) all treasury and
outstanding shares of capital stock of Citizens shall
remain unchanged in all respects.
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1.3 This Agreement is subject in all respects to the provisions of
the applicable insurance laws and shall not become effective until approval is
obtained from the Departments of Insurance of the States of Colorado and
Louisiana in accordance with the provisions of the laws of said states.
Subject to such approval, this Agreement shall be effective for accounting
purposes as of 12:01 a.m., on January 1, 1997.
ARTICLE III
Pre-Merger Obligations
3.1 As soon as practicable, the parties shall file with the
Departments of Insurance in Colorado and Louisiana all of the documents
required by applicable law.
3.2 At the earliest practicable date therefor without objection by
applicable governmental authorities, this Agreement shall be duly submitted to
vote by the shareholders of the parties to the extent and in the manner
required by applicable law.
ARTICLE IV
Conditions to the Merger
The following are conditions precedent to the Merger:
4.1 This Agreement and the transactions contemplated herein shall
have been duly and validly authorized, approved and adopted at meetings of the
shareholders of Citizens and ALFC to the extent required by, and in accordance
with, the applicable laws.
4.2 This Agreement and the transactions contemplated herein shall
have been approved by the Departments of Insurance of the States of Colorado
and Louisiana in accordance with the provisions of the laws of said states.
4.3 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.
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ARTICLE V
Termination and Amendment
Subject to compliance with applicable laws, at any time (whether before
or after approval by shareholders of ALFC and/or Citizens):
5.1 The Board of Directors of Citizens or ALFC may terminate this
Agreement.
5.2 The Board of Directors of Citizens or ALFC may amend the terms
and conditions of this Agreement and/or the exhibits hereto.
ARTICLE VI
Miscellaneous
6.1 The Surviving Corporation may take any action (including
executing and delivering any document) after the Effective Time in the name and
on behalf of either Citizens or ALFC in order to carry out and effectuate the
transactions contemplated by this Agreement.
6.2 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. Any
reference to federal, state, local, or foreign statutes or laws 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. The exhibits identified in this Agreement are incorporated herein
by reference and made a part hereof. 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. Each of the parties
hereto will pay its own fees and expenses incurred in connection with the
transactions contemplated by this Agreement.
6.3 This Agreement shall be governed by and construed in accordance
with the domestic laws of the State of Colorado without giving effect to any
choice or conflict of law provision or rule (whether of the State of Colorado
or any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Colorado.
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IN WITNESS WHEREOF, the parties have set their hands and seals this 22nd
day of November, 1996.
CITIZENS, INC. AMERICAN LIBERTY FINANCIAL
CORPORATION
By: /s/ HAROLD E. RILEY By: /s/ HAROLD E. RILEY
Harold E. Riley, Chairman Harold E. Riley, President
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CERTIFICATE OF MERGER
Pursuant to the provisions of the Louisiana Business Corporation Law,
AMERICAN LIBERTY FINANCIAL CORPORATION, a corporation organized under the laws
of the State of Louisiana ("ALFC"), and CITIZENS, INC., a corporation organized
under the laws of the State of Colorado ("Citizens"), adopt the following
Certificate of Merger:
First: In accordance with Section 12:112 of the Louisiana Business
Corporation Law, a plan and agreement of merger has been approved, adopted,
certified, executed and acknowledged by ALFC and Citizens.
Second: At and as of the effective time set forth below, (a) ALFC will
be merged into Citizens with Citizens being the corporation surviving the
merger (the "Surviving Corporation"), (b) all treasury and outstanding shares
of capital stock of ALFC shall be canceled regardless of actual surrender of
the certificates therefor, and (c) all treasury and outstanding shares of
capital stock of Citizens shall remain unchanged in all respects.
Third: The Articles of Incorporation of Citizens shall be the Articles
of Incorporation of the Surviving Corporation.
Fourth: The executed plan and agreement of merger is on file at
Surviving Corporation's principal place of business located at 400 East
Anderson Lane, Austin, Texas 78752. A copy of the plan and agreement of merger
will be furnished by Citizens, on request and without cost, to any shareholder
of any corporation that is a party to the merger.
Fifth: The merger will become effective on January 1, 1997 at 12:01 a.m.
unless the merger is abandoned and a statement of abandonment is filed in
accordance with applicable law.
IN WITNESS WHEREOF, the undersigned officers of each corporation, duly
authorized by the Boards of Directors of each corporation, have signed this
Certificate of Merger as of November 22, 1996.
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CITIZENS, INC.
By: /s/ HAROLD E. RILEY
Harold E. Riley, Chairman
AMERICAN LIBERTY FINANCIAL
CORPORATION
By: /s/ HAROLD E. RILEY
Harold E. Riley, President
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CERTIFICATE OF SECRETARY
The undersigned duly elected and qualified Secretary of American Liberty
Financial Corporation does hereby certify that the plan and agreement of merger
referred to herein, after being first duly signed by the President on behalf of
American Liberty Financial Corporation, as authorized by its Board of
Directors, was approved by the shareholder of the merged corporation in the
manner required by the Louisiana Business Corporation Law.
AMERICAN LIBERTY FINANCIAL CORPORATION
November 22, 1996 By: /s/ MARK A. OLIVER
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Mark A. Oliver, Secretary
CERTIFICATE OF SECRETARY
The undersigned duly elected and qualified Secretary of Citizens, Inc.
does hereby certify that the plan and agreement of merger referred to herein
was duly signed by the Chairman on behalf of Citizens, Inc., as authorized by
its Board of Directors. As the surviving corporation, shareholder approval was
not required due to satisfaction of all conditions of Section 12:112E(1) of the
Louisiana Business Corporation Law.
CITIZENS, INC.
November 22, 1996 By: /s/ MARK A. OLIVER
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Mark A. Oliver, Secretary
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SIGNATURE OF OFFICERS
Pursuant to the Louisiana Business Corporation Law, the undersigned,
Harold E. Riley, the duly elected and qualified President of American Liberty
Financial Corporation, hereby executes this Certificate of Merger on behalf of
American Liberty Financial Corporation.
AMERICAN LIBERTY FINANCIAL CORPORATION
November 22, 1996 By: /s/ HAROLD E. RILEY
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Harold E. Riley, President
STATE OF TEXAS
COUNTY OF TRAVIS
BEFORE ME, the undersigned authority, personally came and appeared,
Harold E. Riley, duly authorized to act on behalf of American Liberty Financial
Corporation, who declared he is duly authorized and did execute the foregoing
Certificate of Merger on behalf of American Liberty Financial Corporation.
IN WITNESS WHEREOF, the appearer, witnesses and I have hereunto affixed
our signatures on November 22, 1996.
WITNESSES: AMERICAN LIBERTY FINANCIAL
CORPORATION
By: /s/ HAROLD E. RILEY
Harold E. Riley, President
/s/ BRIDGET CANTWELL
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Bridget Cantwell, Notary Public
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SIGNATURE OF OFFICERS
Pursuant to the Louisiana Business Corporation Law, the undersigned,
Harold E. Riley, the duly elected and qualified Chairman of Citizens, Inc.,
hereby executes this Certificate of Merger on behalf of Citizens, Inc..
CITIZENS, INC.
November 22, 1996 By: /s/ HAROLD E. RILEY
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Harold E. Riley, Chairman
STATE OF TEXAS
COUNTY OF TRAVIS
BEFORE ME, the undersigned authority, personally came and appeared,
Harold E. Riley, duly authorized to act on behalf of Citizens, Inc., who
declared he is duly authorized and did execute the foregoing Certificate of
Merger on behalf of Citizens, Inc..
IN WITNESS WHEREOF, the appearer, witnesses and I have hereunto affixed
our signatures on November 22, 1996.
WITNESSES: CITIZENS, INC.
By: /s/ HAROLD E. RILEY
Harold E. Riley, Chairman
/s/ BRIDGET CANTWELL
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Bridget Cantwell, Notary Public
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ARTICLES OF MERGER
Pursuant to the provisions of the Colorado Business Corporation Act (the
"Act"), AMERICAN LIBERTY FINANCIAL CORPORATION, a corporation organized under
the laws of the State of Louisiana ("ALFC"), and CITIZENS, INC., a corporation
organized under the laws of the State of Colorado ("Citizens"), adopt the
following Articles of Merger:
First: In accordance with Section 7-111-103 of the Act, a plan and
agreement of merger has been approved, adopted and executed by ALFC and
Citizens.
Second: Pursuant to Section 7-111-103(7) of the Act, approval by the
shareholders of Citizens, the surviving corporation, is not required. The plan
and agreement of merger was approved by the shareholders of ALFC with the
number of votes cast for the plan by each voting group entitled to vote
separately on the merger being sufficient for approval by that voting group.
Third: At and as of the effective time set forth below, (a) ALFC will
be merged into Citizens with Citizens being the corporation surviving the
merger (the "Surviving Corporation"), (b) all treasury and outstanding shares
of capital stock of ALFC shall be canceled regardless of actual surrender of
the certificates therefor, and (c) all treasury and outstanding shares of
capital stock of Citizens shall remain unchanged in all respects.
Fourth: The Articles of Incorporation of Citizens shall be the Articles
of Incorporation of the Surviving Corporation.
Fifth: The merger shall become effective on January 1, 1997 at 12:01
a.m. unless prior to such time the merger is abandoned and a statement of
abandonment is filed in accordance with applicable law.
Dated: November 22, 1996
CITIZENS, INC. AMERICAN LIBERTY FINANCIAL
CORPORATION
By: /s/ HAROLD E. RILEY By: /s/ HAROLD E. RILEY
Harold E. Riley, Chairman Harold E. Riley, President
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AMENDMENT NO. 1 TO
PLAN AND AGREEMENT OF MERGER
This Amendment No. 1 ("Amendment") to the Plan and Agreement of Merger
("Agreement") is entered into between AMERICAN LIBERTY FINANCIAL CORPORATION, a
corporation organized under the laws of the State of Louisiana ("ALFC"), and
CITIZENS, INC., a corporation organized under the laws of the State of Colorado
("Citizens").
WITNESSETH
WHEREAS, Article V of the Agreement permits the Citizens and ALFC
Boards of Directors to amend the terms and conditions of the Agreement and the
exhibits thereto;
NOW, THEREFORE, the parties agree as follows.
1. AMENDMENT OF SECTION 1.2. Sections 1.2(i) is amended in its
entirety to read as follows:
"(i) For accounting purposes, the effective time ("Effective Time") of
the Merger shall be as of 12:01 a.m., on January 1, 1997."
2. DELETION OF SECTION 1.3. Section 1.3 is deleted.
3. AMENDMENT OF CERTIFICATE OF MERGER AND ARTICLES OF MERGER. The
Articles and Certificate of Merger attached to the Agreement are amended to
delete all provisions defining the effective time of the merger. All remaining
references to dates in the Certificate of Merger and the Articles of Merger are
amended to reflect January 23, 1997.
4. SCOPE OF AMENDMENT. This Amendment embodies all of the changes to
the Agreement as of the date hereof. Except as modified hereby, the Agreement
remains in full force and effect. To facilitate execution, 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.
IN WITNESS WHEREOF, the parties have executed this Amendment as of
January 23, 1997.
CITIZENS, INC. AMERICAN LIBERTY FINANCIAL
CORPORATION
By: /s/ HAROLD E. RILEY By: /s/ HAROLD E. RILEY
Harold E. Riley, Chairman Harold E. Riley, President
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