EXHIBIT 1(d)
AGREEMENT OF MERGER
EXHIBIT 1(d)
AGREEMENT OF MERGER
This Agreement of Merger ("Agreement") is made and entered into as of May __,
2003, by and between IL Annuity and Insurance Company ("IL"), a Kansas stock
life insurance company, whose executive offices and principal place of business
are located at 000 Xxxxx Xxxxxx Xxxxxx, Xxxxxx, Xxxxxx 00000, and Indianapolis
Life Insurance Company, ("the "Surviving Corporation") an Indiana stock life
insurance company, whose executive offices and principal place of business are
located at 0000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxx 00000.
RECITALS
A. The board of directors and sole shareholder of IL and the board of
directors of the Surviving Corporation, respectively, deem it in the
best interest of their respective corporations that IL be merged with
and into the Surviving Corporation (the "Merger").
B. IL and the Surviving Corporation desire to enter into this Agreement to
set forth their mutual understandings regarding the Merger.
C. IL and the Surviving Corporation intend that the Merger qualify as a
tax-free transaction under Section 332 of the Internal Revenue Code.
AGREEMENT
Now, therefore, in consideration of the premises and the mutual representations,
warranties, covenants, and agreements set forth herein, the parties to this
Agreement have agreed, and hereby agree subject to the terms and conditions
hereinafter set forth, as follows:
ARTICLE 1. THE MERGER
1.1 MERGER. Subject to the terms and conditions of this Agreement, at the
Effective Time of the Merger, IL shall be merged with and into the
Surviving Corporation in accordance with the applicable laws of the
States of Kansas and Indiana and the separate existence of IL shall
cease. The Surviving Corporation shall possess: (i) all assets and
property of every description, and every interest therein, wherever
located, and the rights, privileges, immunities, power, franchises, and
authority, of a public as well as of a private nature, of IL and all
obligations belonging to or due IL shall be vested in the Surviving
Corporation without further act or deed; (ii) title to any real estate
or any interest therein vested in IL shall not revert or in any way be
impaired by reason of the Merger; (iii) all rights of creditors and all
liens on any property of IL shall be preserved unimpaired; and (iv) the
Surviving Corporation shall be liable for all obligations of IL and any
claim existing, or action or proceeding pending, by or against IL, may
be prosecuted to judgment with the right of appeal, as if the Merger
had not taken place.
1.2 EFFECTIVE TIME OF MERGER. Unless otherwise agreed by the parties or
otherwise provided by law, the Merger shall become effective at 12:01
a.m., central daylight time, on July 1, 2003 (the "Effective Time").
1.3 GOVERNING LAW. The Surviving Corporation shall be governed by the laws
of the State of Indiana.
ARTICLE 2. MANNER OF EFFECTING MERGER
2.1 SHAREHOLDERS. The sole shareholder of IL, being the Surviving
Corporation, shall, upon the Effective Time, surrender its shares of
stock in IL which shares shall be cancelled without further action by
anyone. No additional stock in the Surviving Corporation shall be
issued.
2.2 IL CERTIFICATES OF AUTHORITY AND CORPORATE AUTHORITY. Prior to the
Effective Time, IL shall tender to the Kansas and Indiana Insurance
Departments its Certificates of Authority. The Kansas and Indiana
Insurance Departments shall hold and cancel such Certificates in
accordance with their respective procedures as a result of the Merger.
2.3 DISSENTING SHAREHOLDERS. The sole shareholder of IL has voted to
approve the Merger and this Agreement pursuant to a resolution dated
_____, 2003. As a result, there are no dissenting shareholders of IL.
Notwithstanding the above, any dissenting shareholder shall be entitled
to payment in cash of an amount equal to the fair value of the stock if
the stockholder shall refuse to assent to the merger.
2.4 REGULATORY APPROVAL. The Merger and this Agreement are subject to
approval by the Kansas and Indiana Insurance Departments and any other
required regulatory approvals.
ARTICLE 3. ARTICLES OF INCORPORATION AND BYLAWS
3.1 ARTICLES AND BYLAWS OF THE SURVIVING CORPORATION. The Articles of
Incorporation and Bylaws of the Surviving Corporation prior to the
merger shall be deemed to be the Articles of Incorporation and Bylaws
of the Surviving Corporation after the merger until further amendment.
ARTICLE 4. DIRECTORS AND OFFICERS
4.1 SURVIVING CORPORATION. The initial post-merger board of directors and
officers of the Surviving Corporation shall be the same persons as
those existing in the Surviving Corporation at the Effective Time, and
shall continue as directors and officers of the Surviving Corporation
until their successors are duly elected and qualified.
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ARTICLE 5. REPRESENTATIONS AND WARRANTIES OF IL
IL warrants and represents to the Surviving Corporation that:
5.1 GENERAL. IL is a stock life insurance company validly existing and in
good standing under the laws of the State of Kansas, and has the
requisite corporate power and authority to conduct its business as it
is currently being conducted.
5.2 LICENSES. IL is engaged in the business of life and annuity insurance
in the State of Kansas and elsewhere and holds valid licenses to
conduct such business, which are in full force and effect on the date
of this Agreement.
5.3 AUTHORITY RELATIVE TO THIS AGREEMENT. IL has all requisite corporate
power and authority to enter into and deliver this Agreement, and the
execution and delivery hereof has been duly approved and authorized by
IL's board of directors and its sole shareholder.
5.4 FINANCIAL STATEMENTS. IL has previously delivered to the Surviving
Corporation true and complete copies of its audited statutory basis
financial statements for the year 2002, and unaudited statutory basis
financial statements through March 31, 2003. Each of those financial
statements is correct and complete in all material respects and was
prepared in conformity with accounting practices prescribed or
permitted by the Kansas Insurance Department, and each presents fairly
in all material respects the financial position, results of operations
and changes in cash flow of IL as of the dates or periods covered
thereby, in conformity with accounting practices prescribed or
permitted by the Kansas Insurance Department. IL has previously made
available to the Surviving Corporation true and complete copies of all
filings made by IL within the past three years with the Kansas
Insurance Department. As of their respective dates, the IL filings did
not contain any untrue statement of a material fact or omit to state
any 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.
5.5 RESERVES. The aggregate actuarial reserves and other actuarial amounts
held in respect of liabilities with respect to IL as established or
reflected in the December 31, 2002, annual financial statement and the
quarterly financial statement as of March 31, 2003, were determined in
accordance with generally accepted actuarial standards consistently
applied, were fairly stated in accordance with sound actuarial
principles and were based on actuarial assumptions that meet the
requirements of the applicable insurance laws of the State of Kansas,
and, to the knowledge of IL, were adequate under generally accepted
actuarial standards consistently applied to cover the total amount of
all reasonably anticipated matured and unmatured liabilities of IL.
5.6 NO UNDISCLOSED LIABILITIES. Except as disclosed in the December 31,
2002, annual financial statement and the March 31, 2003, quarterly
financial statement of IL, IL had no liabilities other than liabilities
in respect to life and annuity insurance contracts, payroll, employee
benefits and other employee compensation, which would have been
required to
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be disclosed on such financial statements, that exceeded individually
or in aggregate the amount of $500,000.
5.7 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since March 31, 2003, except as
disclosed in writing by IL to the Surviving Corporation, IL has
conducted its affairs only in the ordinary course of business in all
material respects, consistent with past practices and there has been no
material adverse change in the business or financial condition of IL.
5.8 LITIGATION. Except as disclosed in writing to the Surviving
Corporation, there are no proceedings pending, nor, to the knowledge of
IL, any proceedings or investigations (other than claims in the
ordinary course of the insurance business) threatened against, relating
to, or involving or affecting IL which exceed individually or in
aggregate $500,000.
5.9 COMPLIANCE WITH LAW. To the best of its knowledge, IL is not in
violation in any material respect (or, with notice or lapse of time or
both, would be in violation in any material respect) of any term or
provision of any applicable law, regulation, rule, ordinance, order,
judgment, writ or injunction of any federal, state, or local government
or instrumentality or agency thereof, or of any court, which violation
may reasonably be expected to have a material adverse effect on the
business or financial condition of IL. IL is not a party to any
contract with or other undertaking to or is subject to any order by or
is a recipient of any supervisory or any other oral or written
communication of any kind from any governmental entity which materially
and adversely affects or is reasonably likely to materially and
adversely affect the business or financial condition of IL.
ARTICLE 6. REPRESENTATIONS AND WARRANTIES OF THE SURVIVING CORPORATION
The Surviving Corporation warrants and represents to IL that:
6.1 GENERAL. The Surviving Corporation is a stock life insurance company,
duly organized, validly existing and in good standing under the laws of
the State of Indiana, and has the requisite corporate power and
authority to conduct its business as it is currently being conducted.
6.2 LICENSES. The Surviving Corporation is engaged in the business of life
and annuity insurance in Indiana and elsewhere, and holds valid
licenses to conduct such business which are in full force and effect on
the date of this Agreement.
6.3 AUTHORITY RELATIVE TO THIS AGREEMENT. The Surviving Corporation has all
requisite corporate power and authority to enter into and deliver this
Agreement, and the execution and delivery hereof has been duly approved
and authorized by the Surviving Corporation's board of directors.
6.4 FINANCIAL STATEMENTS. The Surviving Corporation has previously
delivered to IL true and complete copies of its audited statutory basis
financial statement for the year 2002,
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and an unaudited statutory basis quarterly financial statement through
March 31, 2003. Each of those financial statements is correct and
complete in all material respects and was prepared in conformity with
accounting practices prescribed or permitted by the Indiana Insurance
Department, and each presents fairly in all material respects the
financial position, results of operations and changes in cash flow of
the Surviving Corporation as of the dates or further periods covered
thereby, in conformity with accounting practices prescribed or
permitted by the Indiana Insurance Department. The Surviving
Corporation has previously made available to IL true and complete
copies of all filings made by the Surviving Corporation within the past
three years with the Indiana Insurance Department. As of their
respective dates, the Surviving Corporation filings did not contain any
untrue statement of a material fact or omit to state any 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.
6.5 RESERVES. The aggregate actuarial reserves and other actuarial amounts
held in respect of liabilities with respect to the Surviving
Corporation as established or reflected in the December 31, 2002,
annual financial statement and the quarterly financial statement as of
March 31, 2003, were determined in accordance with generally accepted
actuarial standards consistently applied, were fairly stated in
accordance with sound actuarial principles and were based on actuarial
assumptions that meet the requirements of the applicable insurance laws
of the State of Indiana, and, to the knowledge of the Surviving
Corporation, were adequate under generally accepted actuarial standards
consistently applied to cover the total amount of all reasonably
anticipated matured and unmatured liabilities of the Surviving
Corporation.
6.6 NO UNDISCLOSED LIABILITIES. Except as disclosed in the December 31,
2002, annual financial statement and the March 31, 2003, quarterly
financial statement of the Surviving Corporation, the Surviving
Corporation had no liabilities other than liabilities in respect to
life and annuity insurance contracts, payroll, employee benefits and
other employee compensation, which would have been required to be
disclosed on such financial statements, that exceeded individually or
in aggregate the amount of $500,000.
6.7 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since March 31, 2003, except as
disclosed in writing by the Surviving Corporation to IL, the Surviving
Corporation has conducted its affairs only in the ordinary course of
business in all material respects, consistent with past practices and
there has been no material adverse change in the business or financial
condition of the Surviving Corporation.
6.8 LITIGATION. Except as disclosed in writing to IL, there are no
proceedings pending, nor, to the knowledge of the Surviving
Corporation, any proceedings or investigations (other than claims in
the ordinary course of the insurance business) threatened against,
relating to, or involving or affecting the Surviving Corporation which
exceed individually or in aggregate $500,000.
6.9 COMPLIANCE WITH LAW. To the best of its knowledge, the Surviving
Corporation is not in violation in any material respect (or, with
notice or lapse of time or both, would be in
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violation in any material respect) of any term or provision of any
applicable law, regulation, rule, ordinance, order, judgment, writ or
injunction of any federal, state, or local government or
instrumentality or agency thereof, or of any court, which violation may
reasonably be expected to have a material adverse effect on the
business or financial condition of the Surviving Corporation. The
Surviving Corporation is not a party to any contract with or other
undertaking to or is subject to any order by or is a recipient of any
supervisory or any other oral or written communication of any kind from
any governmental entity which materially and adversely affects or is
reasonably likely to materially and adversely affect the business or
financial condition of the Surviving Corporation.
ARTICLE 7. CERTAIN COVENANTS
7.1 CONDUCT OF BUSINESS PENDING THE MERGER. IL and the Surviving
Corporation covenant and agree with each other that from the date
hereof to the Effective Time, unless the other party shall otherwise
agree in writing or as otherwise expressly permitted or contemplated
under the Agreement or required by law:
A. The business of each party shall be conducted only in the
ordinary course in a manner not materially different from the
manner in which the party conducted business since March 31,
2003.
B. No party shall make or propose to make any change in its
underwriting, investment or other practices in any respect
which is materially adverse to the condition of such party.
None of the parties hereto shall, between the date of this
agreement and the Effective Time, dispose of any of its assets
except as agreed to by the parties or in the normal course of
business and for adequate value.
7.2 ACCESS AND INFORMATION. IL and the Surviving Corporation shall afford
to the other and the other's accountants, counsel and other
representatives, full access during normal business hours from the date
hereof to the Effective Time, to all of their respective assets, books,
contracts, commitments, correspondence, and records (including, without
limitation, tax returns, insurance policies and accountants' work
papers) and, during such period, shall furnish promptly to one another
a copy of each material report, schedule or other document filed or
received by it pursuant to the requirements of law and all such other
information concerning its business, assets and personnel as the other
may reasonably request.
7.3 NOTICE OF PROCEEDINGS. IL and the Surviving Corporation shall promptly
notify the other of and provide all information relating to any
proceedings or investigations commenced or threatened against, relating
to or involving or otherwise affecting IL or the Surviving Corporation
which, if concluded adversely, would have a material adverse effect on
the business or financial condition of IL or the Surviving Corporation.
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7.4 NOTIFICATION OF CERTAIN OTHER MATTERS. IL and the Surviving Corporation
shall promptly notify each other and provide each other with all
material information relating to any notice or other communication from
or to any rating agency in connection with this Agreement or the
transactions contemplated hereby or otherwise and from or to any
governmental entity in connection with this Agreement or the
transactions contemplated hereby and any change or other event which
may have a material adverse effect on the condition of such party or
the occurrence of an event or development which, so far as reasonably
can be foreseen at the time of its occurrence, could result in any such
change other than general economic or financial conditions which do not
materially affect such party uniquely.
7.5 CONDUCT OF BUSINESS. As of the Effective Time, the Surviving
Corporation shall issue to policyholders of IL which exist at the
Effective Time, a Merger Certificate reflecting the undertaking of risk
on such policies by the Surviving Corporation in the place of IL. The
Surviving Corporation shall, prior to the Effective Time, have approved
by the Kansas and Indiana Insurance Departments such endorsements and
other materials necessary for the Surviving Corporation to conduct the
business previously conducted by IL within the States of Kansas and
Indiana. IL shall assure that each and all of the reinsurance contracts
under which IL now operates are assignable to and have been assigned to
the Surviving Corporation as of the Effective Time.
7.6 SERVICE OF PROCESS. Indianapolis Life does hereby agree that it may be
served with process in the State of Kansas in any proceeding for
enforcement of any obligation of IL Annuity, as well as for enforcement
of any obligation of Indianapolis Life arising from the merger,
including any suit or proceeding to enforce the right of any
shareholder. Indianapolis Life does hereby irrevocably appoint the
Kansas Commissioner of Insurance as its agent to accept service of
process in any such suit or other proceedings and shall also appoint
the Secretary of State of Kansas for such purposes; and does hereby
specify the following address to which a copy of such process may be
mailed by the Kansas Commissioner of Insurance, and, if applicable, the
Secretary of State of Kansas: Indianapolis Life Insurance Company, 0000
Xxxxx Xxxxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxx 00000.
ARTICLE 8. CONDITIONS
8.1 CONDITIONS TO EACH PARTY'S OBLIGATION TO EFFECT THE MERGER. The
respective obligations of each party to effect the Merger shall be
subject to the fulfillment at or prior to the Effective Time of the
following conditions:
A. This Agreement and the Merger shall have been approved by the
board of directors and sole shareholder of IL and the board of
directors of the Surviving Corporation;
B. All required regulatory approvals shall have been obtained
prior to the Effective Time.
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8.2 CONDITION TO OBLIGATION OF THE SURVIVING CORPORATION TO EFFECT THE
MERGER. The obligations of the Surviving Corporation to effect the
Merger shall be subject to the fulfillment at or prior to the Effective
Time of the following additional conditions:
A. All corporate action on the part of IL necessary to authorize
the execution, delivery and consummation of this Agreement or
any agreement or instrument contemplated hereby to which IL
is or is to be party and the Merger and any other
transactions contemplated hereby or thereby shall have been
duly and validly taken. IL shall have performed and complied
in all material respects with all obligations and agreements
required to be performed and complied with by it under this
Agreement at or prior to the Effective Time and the
representations and warranties of IL contained in Article 5
of this Agreement shall be true and correct in all material
respects at and as of the date of this Agreement and at and
as of the Effective Time as if made at and as of such date
and time.
B. The Surviving Corporation shall have received a Certificate of
the Chief Executive Officer of IL as to the satisfaction of
the conditions set forth in 8.2A. substantially as set forth
in Exhibit A hereto.
8.3 CONDITIONS TO OBLIGATION OF IL TO EFFECT THE MERGER. The obligations of
IL to effect the Merger shall be subject to the fulfillment at or prior
to the Effective Time of the following additional conditions:
A. All corporate action on the part of the Surviving Corporation
necessary to authorize the execution, delivery and
consummation of this Agreement or any agreement or instrument
contemplated hereby to which the Surviving Corporation is or
is to be party and the Merger and any other transactions
contemplated hereby or thereby shall have been duly and
validly taken. The Surviving Corporation shall have performed
and complied in all material respects with all obligations
and agreements required to be performed and complied with by
it under this Agreement at or prior to the Effective Time and
the representations and warranties of the Surviving
Corporation contained in Article 6 of this Agreement shall be
true and correct in all material respects at and as of the
date of this Agreement and at and as of the Effective Time as
if made at and as of such date and time.
B. IL shall have received a Certificate of the Chief Executive
Officer of the Surviving Corporation as to the satisfaction of
the conditions set forth in 8.3A. substantially as set forth
in Exhibit B hereto.
ARTICLE 9. TERMINATION AND ABANDONMENT
METHODS OF TERMINATION. This Agreement may be terminated and the Merger
abandoned at any time prior to the Effective Date:
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(a) by mutual written consent of IL and the Surviving Corporation,
(b) by either IL or the Surviving Corporation, if there shall be
any law or regulation that makes consummation of the Merger
illegal or otherwise prohibited, or if a judgment, injunction,
order or decree enjoining IL or the Surviving Corporation from
consummating the Merger is entered and such judgment,
injunction, order or decree shall become final and
nonappealable,
(c) by the Surviving Corporation if any of the representations and
warranties set forth in Article 5 or covenants set forth in
Article 7 have been breached by IL, or shall not have been
performed or complied with by IL, in any material respect, at
or before the Effective Time and such breach, non-performance,
or non-compliance have not been cured or eliminated within 30
calendar days after written notice thereof has been given by
the Surviving Corporation to IL, or
(d) by IL if any of the representations and warranties set forth
in Article 6 or covenants set forth in Article 7 have been
breached by the Surviving Corporation, or shall not have been
performed or complied with by the Surviving Corporation, in
any material respect, at or before the Effective Time and such
breach, non-performance, or non-compliance have not been cured
or eliminated within 30 calendar days after written notice
thereof has been given by IL to the Surviving Corporation.
ARTICLE 10. AMENDMENT AND MODIFICATION
Subject to Kansas and Indiana laws, this Agreement may be amended, modified and
supplemented only by written agreement of the parties hereto.
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IN WITNESS WHEREOF, each of the parties hereto have caused this Agreement to be
executed on _____________________, 2003.
IL ANNUITY AND INSURANCE COMPANY
By: _______________________________________
Xxxx X. Xxxxx, President
and Chief Executive Officer
Attest: ___________________________________
Xxxxxxx X. Xxxxxx, Secretary
INDIANAPOLIS LIFE INSURANCE COMPANY
By: _______________________________________
Xxxx X. XxXxxxx, President
and Chief Executive Officer
Attest: ___________________________________
Xxxx Xxxxxxxxx-Xxxxxx, Secretary
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AGREEMENT OF MERGER
BETWEEN
INDIANAPOLIS LIFE INSURANCE COMPANY
AND
IL ANNUITY AND INSURANCE COMPANY
OFFICER'S CERTIFICATE OF IL ANNUITY AND INSURANCE COMPANY PURSUANT
TO SECTION 8.2B. OF THE AGREEMENT
The undersigned, Xxxx X Xxxxx, as the duly elected President and Chief Executive
Officer of IL Annuity and Insurance Company (the "Company"), does hereby certify
on behalf of the Company, in connection with the requirements of Section 8.2B.
of the Agreement of Merger between the Company and Indianapolis Life Insurance
Company, dated as of May _____, 2003, that to the best of his knowledge and
belief:
All corporate action on the part of the Company necessary to authorize
the execution, delivery and consummation of this Agreement has been
taken. The Company has performed or complied in all material respect
with the obligations and agreements required to be performed and
complied with by it under this Agreement at or prior to the Effective
Time of the Merger and the representations and warranties of the
Company contained in Section 8.2A. of the Agreement are true and
correct in all material respects at and as of the date of this
Agreement and at and as of the Effective Time of the Merger as if made
at and as of such date and time.
Certified this _____ day of __________________, 2003.
IL Annuity and Insurance Company
By_________________________________
Xxxx X. Xxxxx, President and
Chief Executive Officer
EXHIBIT A
AGREEMENT OF MERGER
BETWEEN
INDIANAPOLIS LIFE INSURANCE COMPANY
AND
IL ANNUITY AND INSURANCE COMPANY
OFFICER'S CERTIFICATE OF INDIANAPOLIS LIFE INSURANCE COMPANY
PURSUANT TO SECTION 8.3B. OF THE AGREEMENT
The undersigned, Xxxx X XxXxxxx, as the duly elected President and Chief
Executive Officer of Indianapolis Life Insurance Company (the "Company"), does
hereby certify on behalf of the Company, in connection with the requirements of
Section 8.3B. of the Agreement of Merger between the Company and IL Annuity and
Insurance Company, dated as of May _____, 2003, that to the best of his
knowledge and belief:
All corporate action on the part of the Company necessary to authorize
the execution, delivery and consummation of this Agreement has been
taken. The Company has performed or complied in all material respect
with the obligations and agreements required to be performed and
complied with by it under this Agreement at or prior to the Effective
Time of the Merger and the representations and warranties of the
Company contained in Section 8.3A. of the Agreement are true and
correct in all material respects at and as of the date of this
Agreement and at and as of the Effective Time of the Merger as if made
at and as of such date and time.
Certified this _____ day of __________________, 2003.
Indianapolis Life Insurance Company
By_________________________________
Xxxx X. XxXxxxx, President and
Chief Executive Officer
EXHIBIT B
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