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As filed with the Securities and Exchange Commission
on , 1996
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Registration Statement No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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AFLAC INCORPORATED
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(Exact Name of Registrant as Specified in Its Charter)
Georgia
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(State or Other Jurisdiction of Incorporation or Organization)
58-1167100
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(I.R.S. Employer Identification Number)
1932 Wynnton Road, Columbus, Georgia 31999 706-323-3431
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(Address, Including Zip Code, and Telephone Number, Including
Area Code, of Registrant's Principal Executive Offices)
AFLAC ASSOCIATE STOCK BONUS PLAN
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(Full Title of the Plan)
DANIEL P. AMOS
Chief Executive Officer
American Family Life Assurance Company of Columbus
1932 Wynnton Road, Columbus, Georgia 31999 706-323-3431
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(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent for Service)
Approximate date of commencement of proposed sale to the public from
time to time after the effective date of this Registration Statement, in
connection with the AFLAC Associate Stock Bonus Plan described herein.
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If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box.
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If any of the securities being registered on this form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection
with dividend or interest reinvestment plans, check the following box. X
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If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering.
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If this form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering.
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If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box.
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CALCULATION OF REGISTRATION FEE
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Proposed
Maximum Proposed
Title of Aggregate Maximum
Shares Amount Offering Aggregate Amount of
to be to be Price Offering Registration
Registered Registered Per Share* Price Fee
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Common Stock, 2,000,000 $42.0625 $84,125,000 $25,492.42
$.10 par value shares
("Common Stock")
*Based on the reported average high and low prices of the Common Stock of
AFLAC Incorporated as of November 18, 1996.
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The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the
Registrant shall file a further amendment which specifically states that
this Registration Statement shall thereafter become effective in accordance
with Section 8(a) of the Securities Act of 1933 or until the Registration
Statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
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PROSPECTUS DATED -------- --, 1996
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AFLAC INCORPORATED
1932 Wynnton Road
Columbus, Georgia 31999
Telephone No. (706) 323-3431
AFLAC Associate Stock Bonus Plan
2,000,000 Shares of Common Stock ($.10 Par Value)
This Prospectus relates to a maximum of 2,000,000 shares of common
stock, $.10 par value per share, of AFLAC Incorporated (the "Company").
Such shares are to be distributed to certain associates, soliciting brokers,
sales coordinators and special associates of American Family Life Assurance
Company of Columbus ("AFLAC"), a wholly-owned subsidiary of the Company,
pursuant to the AFLAC Associate Stock Bonus Plan (the "Bonus Plan"). Such
distributions are to be made out of shares held by the trust established
under the Bonus Plan (the "Trust"), on the terms and conditions set forth in
the Bonus Plan.
Neither the Company, AFLAC nor the Trust will receive any proceeds from
the distribution of shares of Company Common Stock under the Bonus Plan.
No underwriting discounts or commissions have been or will be paid in
connection with the distribution of shares of Company Common Stock under the
Bonus Plan. AFLAC will bear all expenses in connection with the
registration and distribution of shares under the Bonus Plan.
The Common Stock of the Company is traded on the New York Stock
Exchange, Pacific Stock Exchange and Tokyo Stock Exchange.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is -------- --, 1996.
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Neither the delivery of this Prospectus nor any distribution of
securities hereunder shall under any circumstances create any implication
that there has been no change in the affairs of the Company since the date
hereof. No person has been authorized to give any information or to make
any representations, other than as contained herein, in connection with the
distribution of securities described in this Prospectus, and if given or
made, such information or representations must not be relied upon. This
Prospectus does not constitute an offer or solicitation in any jurisdiction
in which such offer or solicitation is unlawful.
Table of Contents
------------------- Page No.
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Available Information...................................... 3
Information Incorporated by Reference...................... 3
Description of the AFLAC Associate
Stock Bonus Plan......................................... 5
General Information................................... 5
Administration........................................ 5
Eligibility and Enrollment............................ 6
Contributions......................................... 7
Charges Against Participant Accounts.................. 8
Investments........................................... 9
Participant Accounts.................................. 9
Vesting and Distribution of
Benefits; Forfeitures............................... 11
Restrictions on Resale................................ 12
Transferability....................................... 13
Amendment and Termination............................. 13
Tax Consequences........................................... 14
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AVAILABLE INFORMATION
AFLAC Incorporated (the "Company") has filed with the Securities and
Exchange Commission (the "Commission") a Registration Statement under the
Securities Act of 1933, as amended, with respect to securities to be
distributed pursuant to the AFLAC Associate Stock Bonus Plan (the "Bonus
Plan"). This Prospectus does not contain all the information set forth in
the Registration Statement and the exhibits thereto. For further
information with respect to the Company and the Bonus Plan, reference is
hereby made to the Registration Statement, including the exhibits thereto.
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934 (the "Exchange Act") and in accordance
therewith files certain reports, proxy statements and other information with
the Commission. The Registration Statement and all such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities of the Commission, 450 5th Street, N.W., Room 1024,
Washington, DC 20549 and at the Commission's regional offices at Citicorp
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511
and 7 World Trade Center, 13th Floor, New York, New York 10007. Copies of
such materials can be obtained by mail from the Public Reference Section of
the Commission, 450 5th Street, N.W., Washington, DC 20549, at prescribed
rates. The Commission maintains a Web site that contains reports, proxy and
information statements and other information regarding registrants that file
electronically with the Commission. The address of such Web site is
http://www.sec.gov. The Company's Common Stock is listed on the New York
Stock Exchange and the Pacific Stock Exchange, and such reports, proxy
statements and other information concerning the Company can be inspected at
the offices of such exchanges. The Company's Common Stock is also listed on
the Tokyo Stock Exchange.
INFORMATION INCORPORATED BY REFERENCE
The following documents previously filed by the Company with the
Commission hereby are incorporated by reference in this Prospectus:
a. The Company's Annual Report on Form 10-K for the year ended
December 31, 1995;
b. The Company's Quarterly Reports on Form 10-Q for the quarters
ended March 31, 1996, June 30, 1996 and September 30, 1996;
c. All other reports filed by the Company pursuant to Sections
13(a) or 15(d) of the Exchange Act since December 31, 1995;
and
d. The description of the Common Stock contained in a
registration statement filed under the Exchange Act, and any
amendments or reports filed with the Commission for the
purpose of updating such description.
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In addition, all documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act prior to the
filing of a post-effective amendment which indicates that all securities to
be distributed pursuant to the Bonus Plan have been distributed or which
deregisters all such securities not so distributed, shall be deemed to be
incorporated by reference in the Registration Statement and to be a part
thereof from the date of filing of such documents. Any statements contained
in a document incorporated or deemed to be incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus
to the extent that a statement contained herein or in any other subsequently
filed document which also is or is deemed to be incorporated by reference
herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon the written or
oral request of any such person, a copy of any or all of the documents
incorporated herein by reference (other than exhibits to such documents
which are not specifically incorporated by reference in such documents).
Written requests for such copies should be directed to Investor Relations
Department, AFLAC Incorporated, 1932 Wynnton Road, Columbus, Georgia 31999.
Telephone requests may be directed to (800) 235-2667.
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DESCRIPTION OF THE AFLAC ASSOCIATE STOCK BONUS PLAN
GENERAL INFORMATION:
The Bonus Plan was adopted by AFLAC's Board of Directors on November
20, 1967, effective as of October 1, 1967, and was most recently amended and
restated in its entirety on November 10, 1992, effective as of October 1,
1992. The purposes of the Bonus Plan are to provide an incentive to
associates, soliciting brokers, sales coordinators and special associates of
AFLAC to market AFLAC's specialized insurance policies, and to enable AFLAC
to retain experienced sales and supervisory personnel. The Bonus Plan
rewards such persons for sales of AFLAC insurance policies, and encourages
them to acquire and retain a proprietary interest in the success of AFLAC
and the Company.
The Bonus Plan is not subject to any provisions of the Employee
Retirement Income Security Act of 1974.
The following summary of the Bonus Plan does not purport to be complete
and is subject in all respects to the provisions of the Bonus Plan and the
related Trust Agreement.
ADMINISTRATION:
The Bonus Plan provides that it is to be administered by the Stock
Bonus Management Committee designated by AFLAC's Board of Directors. The
Stock Bonus Management Committee has complete control over the
administration of the Bonus Plan. To the extent permitted by law, the Stock
Bonus Management Committee's decisions on all matters within the scope of
its authority are final. The following persons currently serve as members
of the Stock Bonus Management Committee: E. Stephen Purdom, Executive Vice
President, U.S. Operations; Joseph P. Kuechenmeister, Senior Vice President,
Director of Marketing; and Michael E. Bartow, Second Vice President,
Financial. Members of the Stock Bonus Management Committee are designated,
and may be removed, by the AFLAC Board of Directors. The Stock Bonus
Management Committee may delegate its administrative duties and
responsibilities to such persons as it selects.
The assets of the Bonus Plan are held by a Trust established under the
Bonus Plan. The Trust is administered by three Trustees chosen by AFLAC's
Board of Directors. Trustees are chosen for four-year terms, and each is
subject to removal by AFLAC's Board of Directors. The Trustees have broad
powers in the management of the Trust, including authority to acquire and
dispose of stock or other assets. The Trustees receive no compensation for
their services as such. The present Trustees are: Paul S. Amos, Chairman
of the Board of the Company and AFLAC; Daniel P. Amos, President and Chief
Executive Officer of the Company and AFLAC; and Kriss Cloninger, III,
Executive Vice President and Chief Financial Officer of the Company and
AFLAC.
Under the Bonus Plan and the Trust, AFLAC has agreed to indemnify the
Trustees, the members of the Stock Bonus Management Committee and the AFLAC
Board of Directors, and any other party acting with respect to the Bonus
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Plan at the request of AFLAC or the Stock Bonus management Committee,
fromany liability for their acts, omissions or conduct in such capacities,
except to the extent that such liability results from their own willful
misconduct or gross negligence.
Any dispute arising under the Bonus Plan, to the maximum extent
permitted by applicable law, is subject to arbitration pursuant to the terms
of the Federal Arbitration Act.
Participants in the Bonus Plan receive quarterly reports of the
balances in their accounts if they have account activity during the subject
quarter. Upon request, Participants will also be provided with additional
copies of this Prospectus, Bonus Plan financial statements, copies of the
Bonus Plan and related Trust Agreement and other documents. AFLAC provides
all necessary forms, and accounting and other services required to carry out
the proper administration of the Bonus Plan. Additional information about
the Bonus Plan and its administrators may be obtained from the Stock Bonus
Department, 1932 Wynnton Road, Columbus, Georgia 31999. Telephone requests
may be directed to 1-800-99-AFLAC.
ELIGIBILITY AND ENROLLMENT:
Each associate, soliciting broker and sales coordinator is eligible to
participate in the Bonus Plan. Under the terms of the Bonus Plan, an
associate is defined as any person or entity associated with AFLAC pursuant
to an Associate's Contract pertaining to services in the United States, its
territories and possessions, and any other location or country designated by
AFLAC, who is paid on a commission basis and who is actively performing
sales and servicing functions for AFLAC. A soliciting broker is defined as
an associate who is also providing services to AFLAC pursuant to a
standardized Soliciting Broker Contract, and a sales coordinator is defined
as an associate who is also providing services to AFLAC pursuant to a
contract as a district, regional or state sales coordinator. Special
associates, which are defined in the Bonus Plan to mean persons or entities
associated with AFLAC pursuant to a special written agreement who are
engaged in the sale of insurance products for AFLAC and are paid on a
commission basis, are also eligible to participate in the Bonus Plan, but
only if the written agreement between AFLAC and the Special Associate so
provides.
Any individual or entity who was a participant in the Bonus Plan prior
to October 1, 1992, the effective date of the Amended and Restated Bonus
Plan document, shall continue to be a participant in the Bonus Plan. After
October 1, 1992, any associate, soliciting broker, sales coordinator or
eligible special associate shall become a participant on the day that he
first becomes an associate, soliciting broker, sales coordinator or special
associate, unless he notifies AFLAC in writing that he does not which to
become a participant. All persons or entities who participate in the Bonus
Plan are hereafter referred to as "Participants."
The Bonus Plan shall not be deemed to constitute a contract between
AFLAC and the Participant, or to be consideration, or an inducement, for the
association of any Participant with AFLAC. No provision of the Bonus Plan
shall be deemed to give any Participant the right to be retained in
association with AFLAC, or to interfere with the right of AFLAC to discharge
any Participant at any time regardless of the effect which such discharge
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will have upon him as a Participant. Each Participant, for himself and his
heirs, assigns and designated beneficiaries, shall be deemed conclusively by
his participation in the Bonus Plan to have agreed to and accepted the terms
and conditions of the Bonus Plan. A Participant may terminate his
participation in the Bonus Plan at any time by giving written notice to
AFLAC.
CONTRIBUTIONS:
All contributions to the Bonus Plan, if any, are made out of the
profits or accumulated profits of AFLAC; provided, however, that the Board
of Directors of AFLAC may authorize contributions from other sources. No
contributions may be made by any Participant.
Contributions are generally credited to Participant accounts for
certain insurance policies sold by a Participant, and such contributions are
based on (i) in the case of policies made effective prior to October 1,
1992, premiums which are scheduled to be received by AFLAC for the first
twelve months of coverage after a policy is made effective at AFLAC's home
office, and (ii) in the case of policies made effective on or after October
1, 1992, commissionable premiums which are actually collected by AFLAC
during the first twelve months of a policy. Contributions are made only
with respect to insurance policies designated as "Bonus Policies" by AFLAC.
A list of those policies which are designated as Bonus Policies is included
in the AFLAC Commission Structure which is distributed periodically to sales
coordinators who, in turn, communicate such information to associates and
soliciting brokers. Participants may obtain copies of the current list from
sales coordinators or the Marketing Department of AFLAC. AFLAC may, at any
time and in its sole discretion, change the insurance policies to be
designated as Bonus Policies.
Currently, the amount contributed with respect to Bonus Policies is as
follows: (i) for associates and soliciting brokers, 3.5% of the first year
premiums scheduled to be received (in the case of Bonus Policies made
effective prior to October 1, 1992) or actually received (in the case of
Bonus Policies made effective on or after October 1, 1992) on Bonus Policies
sold by the Participant; and (ii) for sales coordinators, .7% of the first
year premiums scheduled to be received (in the case of Bonus Policies made
effective prior to October 1, 1992) or actually received (in the case of
Bonus Policies made effective on or after October 1, 1992) on Bonus Policies
sold by each Participant who is assigned in writing to the sales
coordinator. The Stock Bonus Management Committee may, at any time and in
its sole discretion, change the amount to be contributed on behalf of
associates, soliciting brokers and sales coordinators. The amount
contributed with respect to Bonus Policies sold by special associates is
determined in accordance with the written agreement between the Special
Associate and AFLAC.
All contributions to the Bonus Plan are made to the Trust.
Contributions are made not later than the last business day of the month
(the "Allocation Date") following the month in which the Bonus Policy is
made effective at AFLAC's home office (in the case of Bonus Policies made
effective prior to October 1, 1992) or in which first-year commissionable
premiums are actually collected (in the case of Bonus Policies made
effective on or after October 1, 1992).
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AFLAC makes contributions based upon the first-year premiums scheduled
to be received on Bonus Policies made effective during the month to which
the Allocation Date relates if the effective date of the Bonus Policy is
prior to October 1, 1992. Such contributions are treated as advances by
AFLAC until AFLAC's actual collection of all such first-year premiums. If
the effective date of the Bonus Policy is on or after October 1, 1992, AFLAC
makes contributions based upon the first-year premiums actually collected by
AFLAC during the month to which the Allocation Date relates.
AFLAC bears all costs incurred in the operation of the Bonus Plan and
the Trust, other than brokerage and other fees directly related to the
purchase of shares of Company Common Stock or other permitted investments.
Such brokerage and other related fees are charged against the investments
prior to allocation to the Participant's accounts.
CHARGES AGAINST PARTICIPANT ACCOUNTS:
In the event that a Bonus Policy made effective prior to October 1,
1992 lapses or is cancelled before all first-year premiums are collected by
AFLAC, AFLAC is entitled to recover from the Trust, and there is charged
against the Participant's accounts, an amount equal to the amount previously
credited to the Participant for premiums on such Bonus Policy which were not
collected by AFLAC. If a lapsed or cancelled Bonus Policy made effective
prior to October 1, 1992 is reinstated during the twelve months immediately
following the date on which such Policy is first made effective, AFLAC
contributes to the Plan and credits to the Participant's accounts an amount
equal to the applicable percentage of first-year premiums scheduled to be
received during the months which remain from the date of reinstatement of
such Policy to the expiration of the initial twelve-month period in order to
allow for an offset only for the period of months that such Policy may have
actually lapsed during the initial twelve-month period. A Bonus Policy is
deemed to have lapsed at the time, and subject to the conditions, set forth
in such Policy; provided, however, that, subject to the terms of such
Policy, such time and conditions may be changed by AFLAC in its sole
discretion.
In the event that AFLAC, for any reason and acting in its sole
discretion, determines to refund all or a part of the first-year premiums
collected on a Bonus Policy, it is entitled to recover from the Trust, and
there may be charged against the Participant's accounts, an amount equal to
the amount previously credited to the Participant with respect to the first-
year premiums which were refunded.
To the extent that any amounts recoverable by AFLAC, as a result of
lapsed or cancelled Bonus Policies, refunds on such Policies or otherwise,
have been distributed to a Participant and cannot be recovered by a
reduction in the amount to be allocated in subsequent periods to a
Participant's accounts, then the amount of such distribution creates a
liability to AFLAC on the part of the Participant (i) to be charged back as
a first lien against future earned commissions on first year or renewal
business written by the Participant, or (ii) to be paid to AFLAC on demand
of the Participant.
Further, subject to any applicable legal limitations, AFLAC has the
right to charge against any benefits owed to a Participant under the Bonus
Plan the amount of certain obligations of such Participant to AFLAC. Under
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the terms of the Bonus Plan, "obligations" include any indebtedness of the
Participant to AFLAC including, but not limited to, any advances (including
advances pursuant to the Bonus Plan), loans, unearned commissions or credits
made by or from AFLAC to the Participant. In addition, AFLAC will have a
lien against Plan assets or benefits which have, or may become, due to such
Participant (or his beneficiary) under the Bonus Plan, which lien will be a
first lien in favor of AFLAC as to such assets or benefits. The Bonus Plan
provides that, in consideration of the right to participate in the Bonus
Plan and the benefits paid under such Plan to the Participant and each
beneficiary by AFLAC, each Participant and each beneficiary grants and
assigns to AFLAC a security interest in all assets, rights and benefits
which have, or may become, due to the Participant or beneficiary pursuant to
the Bonus Plan.
In addition, in the event of the insolvency of AFLAC, all assets
contributed to the Trust on or after October 1, 1992, including any
forfeited amount that is credited to a Participant's account on or after
October 1, 1992, and income thereon then held pursuant to the Trust shall be
available for satisfaction of the claims of the general creditors of AFLAC
in accordance with state and federal laws; provided, however, that any cash
and stock dividends on assets contributed to the Trust prior to October 1,
1992 and any contributions that are made as the result of stock splits of
shares of Company Common Stock held in the Trust prior to October 1, 1992
shall not be subject to such claims regardless of whether such dividends or
contributions occur on or after October 1, 1992. AFLAC shall be considered
insolvent if it is either (i) unable to pay its debts as they become due, or
(ii) subject to a pending proceeding as a debtor under the United States
Bankruptcy Code.
Except as set forth above, or in the event of a forfeiture or mistaken
contribution, no portion of the assets of the Bonus Plan will inure to the
benefit of or revert to AFLAC or the Company, and all assets of the Bonus
Plan must be held for the exclusive purpose of providing benefits to
Participants and their beneficiaries.
INVESTMENTS:
It is the express intent of the Bonus Plan, and the Trust established
thereunder, that contributions be invested in Company Common Stock, and all
funds in the Trust are currently so invested. The Trust Agreement provides
that, if shares of Company Common Stock are not available or cannot be
purchased under applicable law, the assets of the Trust may be invested in
cash or cash equivalents. The Trustees direct the Trust to acquire the
Company's Common Stock through purchases either in the public trading market
or from the treasury.
PARTICIPANT ACCOUNTS:
Under the Bonus Plan, an individual fund account and an individual
shares account are maintained for each Participant. Contributions to which
no Participant is initially entitled and forfeitures and other amounts
recoverable by AFLAC are designated as unallocated funds and unallocated
shares.
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AFLAC contributions are credited to each Participant's fund account as
of the Allocation Date, and the balance in the fund account is then reduced
(to as close to zero as possible) to reflect the allocation of shares of
Company Common Stock to the Participant's shares account. AFLAC generally
makes contributions to the Trust, and the Trust generally purchases shares
of Company Common Stock, either in the open market or from the treasury,
several times each month. For purposes of adjusting the accounts as of the
Allocation Date, the cost of shares of Company Common Stock to be charged
against each Participant's fund account is deemed to be the weighted average
purchase price (including any brokerage and other fees directly related
thereto) of all shares of Company Common Stock purchased for the reporting
month to which the Allocation Date relates. Shares of Company Common Stock
held as unallocated shares (as a result of forfeitures or for any other
reason) which are transferred to Participant share accounts are deemed to
have been purchased at a price equal to (i) the closing market price on the
last business day of the reporting month to which such forfeiture relates in
the case of shares of Company Common Stock which were held as unallocated
shares as a result of forfeiture, (ii) the closing market price on the date
of surrender in the case of shares of Company Common Stock surrendered as
the result of obligations owed to AFLAC or as the result of the distribution
of cash in lieu of fractional shares, and (iii) the weighted average
purchase price (including brokerage and other fees directly related thereto)
of all shares of Company Common Stock purchased for the reporting month to
which the event relates in the case of shares of Company Common Stock which
were held as unallocated shares as a result of any other event.
In the discretion of AFLAC, all cash and Company Common Stock held as
unallocated funds and unallocated shares will revert back to AFLAC, and
become the sole property of AFLAC, subject only to AFLAC's obligation to
recontribute amounts to the Bonus Plan upon a Participant's reassociation
with AFLAC. Alternatively, AFLAC may (i) offset all or a part of the
unallocated funds and unallocated shares against its contribution
obligations under the Bonus Plan, or (ii) request that the Bonus Plan
purchase shares of Company Common Stock held as unallocated shares; for
purposes of (i) or (ii), the shares of Company Common Stock held as
unallocated shares are valued at a price equal to (i) the closing market
price on the last business day of the reporting month to which the
forfeiture relates in the case of shares of Company Common Stock which were
held as unallocated shares as a result of forfeiture, (ii) the closing
market price on the date of surrender in the case of shares of Company
Common Stock surrendered as the result of obligations owed to AFLAC or as
the result of the distribution of cash in lieu of fractional shares, and
(iii) the weighted average purchase price (including brokerage and other
fees directly related thereto) of all shares of Company Common Stock
purchased for the reporting month to which the event relates in the case of
shares of Company Common Stock which were held as unallocated shares as a
result of any other event.
Cash and stock dividends on Company Common Stock held in share accounts
are allocated to such share accounts or the corresponding fund accounts.
Cash and stock dividends on Company Common Stock held as unallocated shares
are designated as unallocated funds or unallocated shares, respectively.
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VESTING AND DISTRIBUTION OF BENEFITS; FORFEITURES:
Set forth below is a description of the provisions of the Bonus Plan
relating to vesting, distribution and forfeiture of benefits for associates,
soliciting brokers and sales associates. Special associates are also
subject to these provisions unless the written agreement between AFLAC and
the special associate provides otherwise.
A Participant's interest in the Bonus Plan will vest to the extent of
25 percent after five years of credited service with AFLAC, and 100 percent
after ten years of credited service. A Participant's interest will vest 100
percent at death, retirement at age 65 or over, or total and permanent
disability while still in service with AFLAC. The Participant will be
credited with any amounts related to Bonus Policies prior to the end of the
calendar month in which the termination date occurs, and his accounts will
be reduced to reflect amounts recoverable by AFLAC with respect to lapsed or
cancelled policies and refunded premiums up to the last business day of the
calendar month in which the termination occurred. Vesting may also be
accelerated at the discretion of AFLAC.
In the event that a Participant's association with AFLAC is terminated
for cause in accordance with the terms and provisions of the written
contract or agreement between such Participant and AFLAC, the Participant is
entitled to receive all amounts which vested prior to the date of
termination, but neither the Participant nor his beneficiary (nor any person
claiming on behalf of such Participant or beneficiary) is entitled to
receive any other distribution or benefits under the Bonus Plan.
Service credited for purposes of vesting includes all periods for which
a Participant is actively performing services for AFLAC pursuant to a
written contract as an associate, soliciting broker, sales associate or
special associate, subject to certain special rules and exceptions. Length
of service for purposes of vesting is determined by the time elapsed from
commencement of service to severance from service, as determined under the
Bonus Plan, in years and fractions based on the number of days with 365 days
constituting a full year. If a Participant has a break in service, the
period of service before the break is credited as service for purposes of
vesting.
A Participant forfeits the portion of his accounts which is not vested
upon termination of his association with AFLAC. However, if a Participant
has a break in service of less than one year, then on the first Allocation
Date occurring after the break, the Participant's individual fund account
will be credited with the cash and the market value of the shares of Company
Common Stock held in the Participant's accounts on the last business day of
the month following the month in which the Participant's termination of
association previously occurred.
On the day on which a Participant completes five years of service, he
becomes vested in 25% of the balance of his shares account. The vested
amount of whole shares of Company Common Stock (which includes amounts
allocated to his shares account for the third month of the calendar quarter
in which the Participant vests) is distributed to the Participant within 45
days after the end of such calendar quarter, but no further distributions
will be made until the Participant becomes 100% vested, through years of
service or otherwise. On the day on which a Participant completes ten years
of service, he becomes vested in 100% of the balances of his accounts. The
11
<PAGE>
vested amount of whole shares of Company Common Stock (which includes
amounts allocated to his shares account for the third month of the calendar
quarter in which the Participant vests) is distributed to the Participant
within 45 days after the end of such calendar quarter. The Participant
shall thereafter be 100% vested at all times in the balances of his accounts
and, within 45 days after the end of each calendar year until the
Participant terminates his association with AFLAC, the Bonus Plan will
distribute to the Participant the balance of the Participant's shares
account as of the end of such year (including amounts allocated to the
account for the twelfth month of the calendar year). Final distribution of
balances of the Participant's accounts will be made within 45 days after the
end of the calendar quarter in which such termination occurs.
If a Participant becomes 100% vested upon termination at age 65 or
later, or as a result of death or total and permanent disability, the vested
amounts are distributed to the Participant or his beneficiary within 45 days
after the end of the calendar quarter in which the date of termination
occurs. If the Participant is a corporation, partnership or other legal
entity, the Stock Bonus Management Committee shall determine rights to
distribution under these circumstances.
If the distribution is a final distribution, the Participant or his
beneficiary will generally receive all whole shares of Company Common Stock
credited to the participant's shares account, cash in lieu of any fractional
shares of stock held in such account and the cash held in the Participant's
fund account. If the distribution is not a final distribution, the
Participant will receive only the whole shares of Company Common Stock
credited to his individual shares account. The Stock Bonus Management
Committee has absolute discretion to determine the form of distribution
under the Bonus Plan to a Participant or beneficiary who is at the time of
distribution an "affiliate" of the Company within the meaning of Rule 144
under the Securities Act of 1933 ("1933 Act"), as amended. Shares of
Company Common Stock acquired by affiliates will be subject to certain
restrictions on resale. See "Restrictions on Resale" below.
Benefits under the Bonus Plan may, to the extent permitted by law, be
applied to satisfy a Participant's obligations to AFLAC, before any benefits
are distributed directly to such Participant, in which case the Trust pays
such amounts directly to AFLAC. See "Additional Charges Against Participant
Accounts."
Participants become entitled to exercise rights as stockholders of the
Company upon distribution to them of shares of Company Common Stock to which
they have vested rights under the Bonus Plan. Under its listing agreement
with the New York Stock Exchange, the Company has agreed that the shares of
Company Common Stock held by the Trust shall be voted by the Trustees of the
Trust, at all stockholders' meetings, in favor of or against proposals made
to stockholders in proportion to the vote of other holders of the Company's
Common Stock.
RESTRICTIONS ON RESALE:
Shares of Company Common Stock received upon distribution of
Participant accounts may, in general, be resold to the public without
registration or other restriction under the 1933 Act, if at the time of
resale the Participant (or his beneficiary) is not an "affiliate" of the
12
<PAGE>
Company within the meaning of the 1933 Act. Such shares may not, however,
be resold to the public by an "affiliate" without registration under the
1933 Act, except in compliance with the applicable requirements of Rule 144
under the 1933 Act, or pursuant to any other applicable exemption. An
"affiliate" is a person who directly or indirectly controls, or is
controlled by, or is under common control with, the Company. Generally,
Rule 144 requires that (i) there be available adequate current public
information about the issuer (which requirement is satisfied by the filing
of reports under the Securities Exchange Act of 1934); (ii) the amount of
all issued securities sold by the affiliate during any three-month period
may not exceed the greater of one percent of the outstanding shares or the
average weekly reported volume of trading in such securities on all national
securities exchanges during the four calendar weeks preceding the filing of
the required notice of proposed sale; and (iii) all securities be sold in
"brokers' transactions" (as defined in Rule 144).
TRANSFERABILITY:
The Bonus Plan provides that, except as provided therein or as
otherwise required by law, a Participant cannot assign or transfer his
interest in the Bonus Plan. Furthermore, a Participant's interest in the
Bonus Plan is not liable for or subject to his debts, contracts,
liabilities, engagements or torts other than obligations owed to AFLAC or to
the AFLAC Federal Credit Union (if the Participant secures a loan therefrom
with a pledge of his benefits).
AMENDMENT AND TERMINATION:
AFLAC expects the Bonus Plan to be continued indefinitely. However,
AFLAC has the right at any time to reduce or discontinue permanently its
contributions to the Bonus Plan or to amend or terminate the Bonus Plan by
action of its Board of Directors without the consent of the Trustees or
Participants. Nevertheless, unless necessary to meet the requirements of
any state or federal law or regulation, no modification or termination of
the Bonus Plan may (i) cause or permit any part of the Trust to be used for,
or diverted to, purposes other than the exclusive benefit of Participants in
the Bonus Plan or their beneficiaries (subject to the events described in
"Charges Against Participant Accounts" above), (ii) have the effect of
revesting in or causing to inure to the benefit of AFLAC any portion of the
Trust (subject to the events described in "Charges Against Participant
Accounts" and "Participant Accounts" above), or (iii) operate to deprive any
Participant or beneficiary of any vested right.
Upon termination of the Bonus Plan, AFLAC will deliver a written notice
of termination of the Plan to the Trustees and will direct the Trustees, as
soon as practicable, to bring the balance of all accounts up to date after
allowing for amounts necessary and proper to pay the expenses of the
distribution and other expenses and liquidation costs of the Bonus Plan and
Trust. Upon completion of such accounting, the Trustees shall disburse to
each Participant or beneficiary, as the case may be, the full amount then
standing to his credit in his fund account and the full number of shares in
his share account.
13
<PAGE>
TAX CONSEQUENCES
The Bonus Plan is not eligible for treatment as a "qualified" employee
pension, profit sharing or stock bonus plan under section 401(a) of the
Internal Revenue Code of 1986, as amended ("Code"), because the Bonus Plan
covers agents who are independent contractors.
Under section 83 of the Code and the Treasury regulations thereunder,
the value of the Company Common Stock is includible in the gross income of a
Participant when his ownership interest in such Stock becomes substantially
vested. Shares of Company Common Stock received by a Participant will have
a tax basis in his hands for computing future gain or loss equal to the
amount includible in his gross income attributable to such shares. Under
sections 404(d) and/or 83(h) of the Code and the Treasury regulations
thereunder, AFLAC generally receives deductions with respect to the Company
Common Stock at the time it is includible in the gross income of a
Participant.
Different rules may apply in the case of any Participant who is subject
to the reporting requirements of Section 16(a) of the Securities Exchange
Act of 1934, as amended.
The above is a summary only, and reference is made to the Code and
regulations thereunder, for a complete statement of the relevant provisions.
Each Participant is urged to consult his or her own tax advisor regarding
the consequences under federal, state, local, and other law of participation
in the Bonus Plan.
14
<PAGE>
PART II: INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The estimated expenses in connection with distribution of the
securities being registered, are as follows:
SEC registration fee ....................... $ 25,492.42
Legal fees and expenses..................... 7,500.00
Accounting fees and expenses................ 5,500.00
Miscellaneous............................... 15,000.00
-----------
Total $ 53,492.42
Item 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Georgia Business Corporation Code provides that, under certain
circumstances, directors, officers, employees and agents of a Georgia
corporation may be indemnified against expenses, judgments, fines and
amounts paid in settlement actually and reasonably incurred by them in
connection with settling, or otherwise disposing of, suits or threatened
suits to which they are a party or threatened to be named a party by reason
of acting in any of such capacities if such person acted in a manner such
person believed in good faith to be in, or not opposed to, the best
interests of the corporation. The By-Laws of the Company provide for
indemnification of officers and directors to the fullest extent permitted by
such Georgia law. The Company's Articles of Incorporation also limit the
potential personal monetary liability of the members of the Company's Board
of Directors to the Company or its stockholders for certain breaches of
their duty of care or other duties as a director.
The Company maintains (i) director and officer liability insurance that
provides for indemnification of the directors and officers of the Company
and of its majority-owned subsidiaries, and (ii) company reimbursement
insurance that provides for indemnification of the Company and its majority-
owned subsidiaries in those instances where the Company and/or its majority-
owned subsidiaries indemnified its directors and officers.
II-1
<PAGE>
Item 16. EXHIBITS
The following exhibits are filed with this registration statement:
Exhibit No.
(per Exhibit
Table in
Item 601 of
Regulation S-K) Description of Exhibit
- --------------- -------------------------------
5.1 Opinion of Joey M. Loudermilk, Esq.
15 Letter of KPMG Peat Marwick LLP
Re: Unaudited Interim Financial Information
23.1 Consent of Joey M. Loudermilk, Esq.
(included in Exhibit 5.1)
23.2 Consent of KPMG Peat Marwick LLP
99 AFLAC Associate Stock Bonus Plan and
Related Trust Agreement
Item 17. UNDERTAKINGS
a. RULE 415 OFFERING. The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration
statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate,
represents a fundamental change in the information set
forth in the registration statement;
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in
the registration statement or any material change to
such information in the registration statement;
provided, however, that paragraphs (i) and (ii) do not apply if the
registration statement is on Form S-3 or Form S-8 and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by the registrant pursuant to Section 13
or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
II-2
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
b. FILINGS INCORPORATING SUBSEQUENT EXCHANGE ACT REPORTS BY REFERENCE.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
the registrant's annual report pursuant to Section 13(a) or Section 15(d) of
the Securities Exchange Act of 1934 (and, where applicable, each filing of
an employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
c. REQUEST FOR ACCELERATION OF THE EFFECTIVE DATE OR FILING OF
REGISTRATION STATEMENT ON FORM S-8. Insofar as indemnification for
liabilities arising under the Securities Act of 1933 may be permitted to
directors, officers and controlling persons of the registrant pursuant to
the foregoing provisions, or otherwise, the registrant has been advised that
in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of
expenses incurred or paid by a director, officer or controlling person of
the registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in connection
with the securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of
Columbus, State of Georgia, on November 21, 1996.
AFLAC INCORPORATED
Dated: November 21, 1996 By: /s/ Daniel P. Amos
--------------------- -------------------------------------
Daniel P. Amos
Chief Executive Officer
Dated: November 21, 1996 By: /s/ Kriss Cloninger, III
--------------------- ------------------------------------
Kriss Cloninger, III
Executive Vice-President,
Chief Financial Officer and Treasurer
Dated: November 21, 1996 By: /s/ Norman P. Foster
--------------------- ------------------------------------
Norman P. Foster
Executive Vice-President,
Corporate Finance
II-4
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
Signature Title Date
------------- --------- --------
/s/ Paul S. Amos
- -------------------------- Chairman of the Board November 21, 1996
Paul S. Amos
/s/ Daniel P. Amos
- -------------------------- Vice Chairman of November 21, 1996
Daniel P. Amos the Board
/s/ John Shelby Amos, II
- -------------------------- Director November 21, 1996
John Shelby Amos, II
/s/ Michael H. Armacost
- -------------------------- Director November 21, 1996
Michael H. Armacost
/s/ M. Delmar Edwards, M.D.
- -------------------------- Director November 21, 1996
M. Delmar Edwards, M.D.
/s/ George W. Ford, Jr.
- -------------------------- Director November 21, 1996
George W. Ford, Jr.
/s/ Joe Frank Harris
- -------------------------- Director November 21, 1996
Joe Frank Harris
/s/ Elizabeth J. Hudson
- -------------------------- Director November 21, 1996
Elizabeth J. Hudson
/s/ Kenneth S. Janke, Sr.
- -------------------------- Director November 21, 1996
Kenneth S. Janke, Sr.
/s/ Charles B. Knapp, Ph.D.
- -------------------------- Director November 21, 1996
Charles B. Knapp, Ph.D.
II-5
<PAGE>
/s/ Hisao Kobayashi
- -------------------------- Director November 21, 1996
Hisao Kobayashi
/s/ Yoshiki Otake
- -------------------------- Director November 21, 1996
Yoshiki Otake
/s/ E. Stephen Purdom
- -------------------------- Director November 21, 1996
E. Stephen Purdom
/s/ Barbara K. Rimer
- -------------------------- Director November 21, 1996
Barbara K. Rimer
/s/ Henry C. Schwob
- -------------------------- Director November 21, 1996
Henry C. Schwob
/s/ J. Kyle Spencer
- -------------------------- Director November 21, 1996
J. Kyle Spencer
/s/ Glenn Vaughn, Jr.
- -------------------------- Director November 21, 1996
Glenn Vaughn, Jr.
II-6
<PAGE>
EXHIBIT INDEX
-------------
NUMBER DESCRIPTION
- ------ -----------------
5.1 Opinion of Joey M. Loudermilk, Esq.
15 Letter of KPMG Peat Marwick LLP
Re: Unaudited Interim Financial Information
23.1 Consent of Joey M. Loudermilk, Esq.
(included in Exhibit 5.1)
23.2 Consent of KPMG Peat Marwick LLP
99 AFLAC Associate Stock Bonus Plan and
Related Trust Agreement
II-7
<PAGE>
EXHIBIT 5.1
EXH 5.1
<PAGE>
EXHIBIT 5.1
November 20, 1996
AFLAC Incorporated
1932 Wynnton Road
Columbus, Georgia 31999
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
I am Senior Vice President and General Counsel of AFLAC Incorporated, a
Georgia corporation (the "Company"). The Company is filing a Registration
Statement on Form S-3 (the "Registration Statement") with the Securities and
Exchange Commission relating to 2,000,000 shares of common stock, par value
$.10 per share (the "Common Stock"), of the Company (the "Shares") issuable
pursuant to the AFLAC Associate Stock Bonus Plan (the "Plan").
This opinion is delivered in accordance with the requirements of Item
601(b)(5) of Regulation S-K under the Securities Act of 1933, as amended
(the "Act").
In connection with this opinion, I have reviewed such documents as I
have deemed necessary or appropriate as a basis for the opinion set forth
below. In my examination, I have assumed the genuineness of all signatures,
the legal capacity of all natural persons, the authenticity of all documents
submitted to me as originals, the conformity to original documents of all
documents submitted to me as certified or photostatic copies, and the
authenticity of the originals of such copies. As to any facts material to
this opinion that I did not independently establish or verify, I have relied
upon representations or certificates of the officers and directors of the
Company.
I am a member of the State Bar of Georgia and I express no opinion as
to the laws of any other jurisdiction.
Based upon the foregoing, and subject to the qualifications set forth
herein, I am of the opinion that the Shares have been duly and validly
authorized and when acquired from the Company by the Trust established under
the Plan as described in the Registration Statement, the Shares will be
validly issued, fully paid and nonassessable.
I hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement and to the use of my name in the Prospectus that is a
part of the Registration Statement.
Very truly yours,
/s/ Joey M. Loudermilk
Joey M. Loudermilk
Senior Vice President and General Counsel
EXH 5.1-1
<PAGE>
EXHIBIT 15
EXH 15
<PAGE>
KPMG Peat Marwick LLP
303 Peachtree Street, N.E.
Suite 2000
Atlanta, Georgia 30308
The Board of Directors
AFLAC Incorporated
Columbus, Georgia
Gentlemen:
Re: Registration Statement Form S-3
With respect to the subject registration statement dated November 21, 1996,
we acknowledge our awareness of the use therein of our reports dated April
23, 1996, July 23, 1996 and October 22, 1996 related to our reviews of
interim financial information.
Pursuant to Rule 436(c) under the Securities Act of 1933, such reports are
not considered a part of a registration statement prepared or certified by
an accountant or reports prepared or certified by an accountant within the
meaning of sections 7 and 11 of the Act.
Very truly yours,
KPMG PEAT MARWICK LLP
Atlanta, Georgia
November 21, 1996
EXH 15-1
<PAGE>
EXHIBIT 23.2
EXH 23.2
<PAGE>
KPMG Peat Marwick LLP
303 Peachtree Street, N.E.
Suite 2000
Atlanta, Georgia 30308
The Board of Directors
AFLAC Incorporated
Columbus, Georgia
We consent to incorporation by reference in the registration statement dated
November 21, 1996, on Form S-3 of AFLAC Incorporated of our report dated
January 29, 1996, relating to the consolidated balance sheets of AFLAC
Incorporated and subsidiaries as of December 31, 1995 and 1994, and the
related consolidated statements of earnings, stockholders' equity, and cash
flows and related schedules for each of the years in the three-year period
ended December 31, 1995 which report appears in the December 31, 1995,
annual report on Form 10-K of AFLAC Incorporated.
KPMG PEAT MARWICK LLP
Atlanta, Georgia
November 21, 1996
EXH 23.2-1
<PAGE>
EXHIBIT 99
EXH 99
<PAGE>
AFLAC ASSOCIATE
STOCK BONUS PLAN
WITH RELATED
TRUST AGREEMENT
AMENDED AND RESTATED AS OF OCTOBER 1, 1992
EXH 99-1
<PAGE>
AFLAC ASSOCIATE STOCK BONUS PLAN
The AFLAC Associate Stock Bonus Plan is hereby amended and restated,
effective as of October 1, 1992, as follows:
ARTICLE 1
DEFINITIONS
As used herein, the following words and phrases shall have the meaning
indicated unless otherwise defined or required by the context:
1.1 "Active Association" shall mean the performance of services by an
Associate, Soliciting Broker, Sales Coordinator or Special Associate
pursuant to a written contract with the Plan Sponsor for the solicitation of
applications for certain insurance products of the Plan Sponsor, and the
servicing of accounts, prior to the effective date of any termination of
such contract whether for cause or without cause.
1.2 "Allocation Date" shall mean, with respect to each month, a day,
determined in the discretion of the Stock Bonus Management Committee, not
later than the last day of the following month.
1.3 "Associate" shall mean any person or entity associated with the
Plan Sponsor pursuant to an Associate's contract pertaining to services in
the United States, its territories and possessions, and any other location
or country designated by the Plan Sponsor, who is paid on a commission basis
and whose Active Association with the Plan Sponsor has not been terminated.
1.4 "Beneficiary" shall mean the recipient or recipients last
designated by a Participant in writing on forms provided by the Plan Sponsor
to receive any benefits payable under the Plan upon the death of the
Participant.
1.5 "Board" shall mean the Board of Directors of American Family Life
Assurance Company of Columbus.
1.6 "Bonus Policy/Policies" shall mean those insurance policies issued
by the Plan Sponsor which the Plan Sponsor, acting in its sole discretion,
designates as "Bonus Policies."
1.7 "Break in Service" shall mean the period of time commencing on the
date on which a Participant's contract or agreement with the Plan Sponsor
has been terminated for any reason whatsoever, and ending on the day before
the Participant's subsequent Commencement Date.
1.8 "Commencement Date" shall mean the date on which one first becomes
an Associate, Soliciting Broker, Sales Coordinator or Special Associate, or,
in the case of a Participant who has incurred a Break in Service, the first
date following such Break in Service on which he or she again becomes an
Associate, Soliciting Broker, Sales Coordinator or Special Associate.
1.9 "First Year Premiums" shall mean premiums scheduled to be received
for the first twelve months of coverage after a Bonus Policy sold by a
Participant is made effective at the home office of the Plan Sponsor.
EXH 99-2
<PAGE>
1.10 "Forfeited Amount" shall mean (i) the cash held in a
Participant's Individual Fund Account, and (ii) the number of shares of
Stock held in the Participant's Individual Shares Account, all determined on
the last business day of the month following the month in which the
Participant's Active Association with the Plan Sponsor is terminated.
1.11 "Individual Accounts" shall mean Participants' Individual Fund
Accounts and/or Individual Shares Accounts.
1.12 "Individual Fund Account" shall mean the Individual Fund Account
for a Participant as described in Section 4.1(b).
1.13 "Individual Shares Account" shall mean the Individual Shares
Account for a Participant as described in Section 4.1(a).
1.14 "Participant" shall mean any Associate, Soliciting Broker, Sales
Coordinator or Special Associate participating in this Plan.
1.15 "Plan" shall mean the AFLAC Associate Stock Bonus Plan, as
contained herein and as amended from time to time.
1.16 "Plan Sponsor" shall mean the American Family Life Assurance
Company of Columbus, a Georgia corporation, and any subsidiary or affiliate
corporation which may hereafter adopt the Plan with the permission of the
Board.
1.17 "Reporting Month" shall mean a period of time beginning on the
day following the close of the previous reporting month and ending on the
day that policy accounting is performed for such month.
1.18 "Sales Coordinator" shall mean any Associate who is also
providing services to the Plan Sponsor pursuant to a contract as a District
Sales Coordinator, Regional Sales Coordinator, or State Sales Coordinator,
and who is paid on a commission basis.
1.19 "Soliciting Broker" shall mean any Associate who is also
providing services to the Plan Sponsor pursuant to a standardized Soliciting
Broker contract and who is paid on a commission basis.
1.20 "Special Associate" shall mean any person or entity associated
with the Plan Sponsor pursuant to a special written agreement, who is
engaged in the sale of the products of the Plan Sponsor and is paid on a
commission basis, and whose Active Association with the Plan Sponsor has not
been terminated.
1.21 "Stock" or "Shares of Stock" shall mean the common stock of AFLAC
Incorporated.
1.22 "Stock Bonus Management Committee" shall mean the Committee which
shall oversee the operation of this Plan and shall be composed of the Plan
Sponsor's Executive Vice President in charge of domestic operations, its
Director of Marketing and its Controller, and/or such other persons as
designated from time to time by the Board. The Board may remove any member
of this Committee at any time in its absolute discretion.
1.23 "Trust" shall mean the trust created and existing pursuant to
this Plan and designated as the Amended and Restated Trust Agreement dated
October 1, 1992, as such Agreement may be amended from time to time.
EXH 99-3
<PAGE>
1.24 "Trustees" shall mean the Trustees of the Trust.
1.25 "Year of Service" shall mean a period of time in which a
Participant has accumulated 365 days of Active Association. Nonsuccessive
and less than whole year periods of Active Association shall be aggregated
on the basis that 365 days of Active Association equals one whole Year of
Service, and a Year of Service shall be expressed as a number of whole years
plus a fraction of a year, if any, computed on the same basis. In no event
will a Participant accumulate more than one Year of Service for any 12
consecutive-month period.
1.26 "Years of Credited Service" shall mean the Participant's Years of
Service (including whole years plus fractions of a year) during the period
from the Participant's Commencement Date until such Participant's Active
Association with the Plan Sponsor is terminated, subject to and computed in
accordance with the rules on computing Years of Credited Service upon
reassociation after a Break in Service as set forth in Section 5.6 of this
Plan.
ARTICLE 2
ELIGIBILITY AND PARTICIPATION
2.1 CONDITIONS OF ELIGIBILITY. Each Associate, Soliciting Broker and
Sales Coordinator is eligible to become a Participant in the Plan. Special
Associates shall be eligible to participate in this Plan only if so provided
in the written agreement between the Special Associate and the Plan Sponsor.
2.2 PARTICIPATION. An individual or entity who was a Participant
prior to the effective date of this Plan shall continue to be a Participant.
After October 1, 1992, any Associate, Soliciting Broker, Sales Coordinator
or, subject to Section 2.1, any Special Associate, shall immediately become
a Participant on his or her Commencement Date, unless he or she notifies the
Plan Sponsor in writing that he or she will not become a Participant.
2.3 ACCEPTANCE. The Plan shall not be deemed to constitute a contract
between the Plan Sponsor and the Participant or to be consideration, or an
inducement, for the association of any Participant. No provision of the
Plan shall be deemed to give any Participant the right to be retained in
association with the Plan Sponsor, or to interfere with the right of the
Plan Sponsor to discharge any Participant at any time regardless of the
effect which such discharge will have upon him as a Participant. Each
Participant for himself or herself and his or her heirs, assigns and
beneficiaries shall be deemed conclusively by his or her act of
participation herein, to have agreed to and accepted the terms and
conditions of this Plan.
ARTICLE 3
CONTRIBUTIONS, INVESTMENTS AND EXPENSES
3.1 CONTRIBUTIONS BY PLAN SPONSOR. All contributions, if any, shall
be made out of profits or accumulated profits of the Plan Sponsor; provided,
however, that the Board may authorize contributions from other sources. No
contributions will be made by any Participant.
EXH 99-4
<PAGE>
3.2 COMPUTATION OF CONTRIBUTIONS FOR BONUS POLICIES MADE EFFECTIVE
PRIOR TO OCTOBER 1, 1992.
(a) Subject to this Section 3.2 and Section 3.4, with respect to
Bonus Policies made effective prior to October 1, 1992, the amount of Plan
Sponsor contributions made on or before each Allocation Date were equal to
the applicable percentage of aggregate First Year Premiums scheduled to be
received by the Plan Sponsor on Bonus Policies made effective at the Plan
Sponsor's home office during the month to which such Allocation Date
related. Such contributions shall be treated as advances by the Plan
Sponsor to the Trust until the Plan Sponsor's actual collection of all of
such First Year Premiums.
(b) In the event that a Bonus Policy made effective prior to
October 1, 1992 is lapsed or cancelled before all First Year Premiums are
collected by the Plan Sponsor, then the Plan Sponsor shall be entitled to
recover from the Trust, and there shall be charged against the Participant's
Individual Accounts, an amount equal to the applicable percentage of such
First Year Premiums which were not collected by the Plan Sponsor.
(c) In the event a lapsed or cancelled Bonus Policy made
effective prior to October 1, 1992 is reinstated during the twelve (12)
months immediately following the date on which such Policy was first made
effective, the Plan Sponsor shall contribute to the Plan and credit to the
Participant's Individual Fund Account an amount for such Bonus Policy equal
to the applicable percentage of First Year Premiums scheduled to be received
during the months which remain from the date of reinstatement of such Policy
to the expiration of the initial twelve (12) month period in order to allow
for an offset only for the period of months that such Policy may have
actually lapsed during the initial twelve (12) month period.
(d) For purposes of this Section 3.2, a Bonus Policy shall be
deemed to have lapsed at the time, and subject to the conditions, set forth
in such Policy; provided, however, that, subject to the terms of such
Policy, such time and conditions may be changed by the Plan Sponsor in its
sole discretion.
3.3 COMPUTATION OF CONTRIBUTIONS FOR BONUS POLICIES MADE EFFECTIVE ON
OR AFTER OCTOBER 1, 1992. Subject to Section 3.4, with respect to Bonus
Policies made effective on or after October 1, 1992, the amount of Plan
Sponsor contributions to be made on or before each Allocation Date shall be
equal to the applicable percentage of First Year Premiums actually collected
by the Plan Sponsor during the month to which such Allocation Date relates.
3.4 ADDITIONAL CONTRIBUTIONS. In addition to the contributions
required pursuant to Section 3.2 or 3.3, the Plan Sponsor shall contribute
amounts required pursuant to Section 5.6 relating to crediting of Forfeited
Amounts following a Break in Service of less than 12 months.
3.5 REFUNDS. In the event that the Plan Sponsor, for any reason and
acting in its sole discretion, determines to refund all or a part of the
First Year Premiums collected on a Bonus Policy, the Plan Sponsor shall be
entitled to recover from the Trust, and there may be charged against the
Participant's Individual Accounts, an amount equal to the applicable
percentage of such First Year Premiums which were refunded.
EXH 99-5
<PAGE>
3.6 OFFSET AGAINST CONTRIBUTIONS; RECOVERY OF CREDITED AMOUNTS.
(a) Notwithstanding the provisions of Sections 3.2, 3.3 and 3.4,
the amount to be contributed by the Plan Sponsor may, in the sole discretion
of the Plan Sponsor, be reduced to reflect (1) the amounts recoverable by
the Plan Sponsor with respect to lapsed or cancelled Bonus Policies as
provided for in Section 3.2(b); (2) the amounts recoverable by the Plan
Sponsor with respect to refunded First Year Premiums as provided for in
Section 3.5; or (3) amounts forfeited by Participants as provided in Section
5.5. Alternatively, the Plan Sponsor may, with respect to all or part of
such reductions, request that the Plan pay to the Plan Sponsor an amount
equal to such reductions.
(b) On each Allocation Date, the amount to be allocated to a
Participant's Individual Fund Account shall be reduced by the sum of amounts
recoverable by the Plan Sponsor (1) pursuant to Section 3.2(b) for advances
relating to lapsed or cancelled Bonus Policies, and (2) pursuant to Section
3.5 relating to refunded First Year Premiums, for the month to which such
Allocation Date relates. If the amount of such reduction exceeds the amount
otherwise allocable to the Participant's Individual Fund Account, then the
excess shall be applied first to reduce the balance in the Individual Fund
Account to zero and then against the balance of the Participant's Individual
Shares Account. For purposes of reducing the balance of the Participant's
Individual Shares Account, the cost of Shares of Stock shall be deemed to be
the weighted average purchase price (including brokerage and other fees
directly related thereto) of all Shares of Stock purchased for the Reporting
Month to which the Allocation Date relates. If the Participant's Individual
Shares Account is thus reduced to zero and the full amount of the reduction
has not yet been made, the Participant's Individual Fund Account shall have
a negative balance equal to the remaining reduction amount.
(c) To the extent that the amounts recoverable by the Plan
Sponsor have been distributed to a Participant and cannot be recovered
pursuant to the procedures set forth in paragraph (b) above, then the amount
of such distribution shall create a liability to the Plan Sponsor on the
part of the Participant (1) to be charged back as a first lien against
future earned commissions on first year or renewal business written by the
Participant, or (2) to be paid to the Plan Sponsor on demand of the
Participant.
3.7 APPLICABLE PERCENTAGE FOR BONUS POLICIES. Subject to Sections
3.2, 3.3, 3.5 and 3.6, the applicable percentage of First Year Premiums
received on Bonus Policies shall be as follows:
(a) ASSOCIATES AND SOLICITING BROKERS. The Plan Sponsor shall
contribute three and one-half percent (3.5%) (or such other percentage as is
determined to be appropriate by the Stock Bonus Management Committee) of the
First Year Premiums scheduled to be received (for purposes of Section
3.2(a)) or actually received (for purposes of Section 3.3) for each Bonus
Policy sold by a Participant.
(b) SALES COORDINATORS. The Plan Sponsor shall contribute seven-
tenths of one percent (.7%) (or such other percentage as is determined to be
appropriate by the Stock Bonus Management Committee) of the First Year
Premiums scheduled to be received (for purposes of Section 3.2(a)) or
actually received (for purposes of Section 3.3) for each Bonus Policy sold
by a Participant who is assigned in writing to a Sales Coordinator.
EXH 99-6
<PAGE>
(c) SPECIAL ASSOCIATES. The applicable percentage of First Year
Premiums to be contributed with respect to Bonus Policies sold by a Special
Associate shall be determined in accordance with the written agreement
between the Special Associate and the Plan Sponsor.
3.8 DESIGNATION OF BONUS POLICIES. All Participants shall be informed
as to those policies that are designated as Bonus Policies for purposes of
the Plan.
3.9 INVESTMENT OF CONTRIBUTIONS; TRUST. All contributions or advances
made to the Plan shall be made to the Trust. The Trustees of the Trust
shall be appointed by the Board and may consist of one or more in number.
Trustees may be employees of the Plan Sponsor. Unless otherwise determined
by the Trustees, all amounts held by the Trust shall be invested in Stock or
in as much Stock as is available, and all Stock purchased by the Trust shall
be purchased in the open market. Pending investment in Stock, amounts in
the Trust shall be held in cash or cash equivalents. The Trustees, in their
sole discretion, shall purchase Stock at such time and in such amounts as
they deem to be reasonable and practicable, provided all such purchases
shall be in accordance with applicable provisions of the federal securities
law.
3.10 EXPENSES. Subject to the provisions of Section 7.3, the Plan
Sponsor shall bear all costs incurred in the operation of the Plan other
than brokerage and other fees directly related to the purchase of Shares of
Stock or other permitted investments. Such brokerage and other related fees
shall be charged against the investments prior to allocation to the
Participant's Individual Accounts.
ARTICLE 4
PLAN ASSETS
4.1 INDIVIDUAL ACCOUNTS. Each Participant shall have two (2)
Individual Accounts in his name, designated and described as follows:
(a) INDIVIDUAL SHARES ACCOUNT. The balance in this Account
represents the number of Shares of Stock that have been allocated to the
Participant in accordance with the Plan, including Stock paid for with
amounts from the Participant's Individual Fund Account and Stock received as
a result of Stock dividends or Stock splits on Stock allocated to the
Individual Shares Account.
(b) INDIVIDUAL FUND ACCOUNT. The balance in this Account
represents the portion of Plan Sponsor contributions allocated to the
Participant on account of his sale of Bonus Policies, any Plan Sponsor
contribution allocated to this Account in accordance with Section 5.6(a)(1),
and cash dividends on Shares of Stock which are allocated to the
Participant's Individual Shares Account, less any amounts used to pay for
Shares of Stock.
4.2 UNALLOCATED AMOUNTS. Amounts not allocated to Individual Accounts
shall be designated and described as follows:
(a) UNALLOCATED FUNDS. The balance of Unallocated Funds at any
time represents Plan Sponsor contributions prior to allocation to Individual
EXH 99-7
<PAGE>
Accounts, forfeited portions of Individual Fund Accounts and cash dividends
on Unallocated Shares, less any amounts used to pay for Shares of Stock.
(b) UNALLOCATED SHARES. The balance of Unallocated Shares at any
time represents the number of Shares of Stock that have been (i) forfeited
from Individual Shares Accounts or paid for with amounts from Unallocated
Funds, (ii) received as a result of Stock dividends or Stock splits on
Unallocated Shares, (iii) surrendered pursuant to the provisions of Section
3.6(b), (iv) surrendered as a result of a distribution of cash in lieu of
fractional Shares of Stock pursuant to Section 5.3, or (v) surrendered as a
result of obligations owed to the Plan Sponsor pursuant to Section 8.1.
4.3 EXPRESSED IN DOLLARS OR SHARES. Individual Fund Accounts and
Unallocated Funds shall be expressed in dollars and cents. Individual
Shares Accounts and Unallocated Shares shall be expressed in the number of
Shares of Stock held calculated to three decimal places.
4.4 DIVIDENDS. In the event that cash or Stock is paid to the Trust
as a dividend or Stock split with respect to Stock held by the Trust, the
amount of such cash or Stock (a) with respect to Stock allocated to
Individual Shares Accounts shall be allocated to Individual Accounts, cash
dividends to Individual Fund Accounts and Stock to Individual Shares
Accounts, in proportion to the number of Shares of Stock held for the
Participants in their Individual Shares Accounts, and (b) with respect to
Unallocated Shares shall be allocated to Unallocated Funds and Unallocated
Shares, respectively.
4.5 MONTHLY ADJUSTMENT OF ACCOUNTS. As of the Allocation Date for
each month, the accounts in the Trust shall be adjusted as follows:
(a) Plan Sponsor contributions made during the month shall be
credited to each Individual Fund Account based on the applicable percentage
of First Year Premiums scheduled to be received (for purposes of Section
3.2(a)) or actually received (for purposes of Section 3.3) on Bonus Policies
sold by the Participant, subject to reduction as provided in Sections 3.2,
3.5 and 3.6.
(b) Each Participant's Individual Fund Account shall then be
reduced by the cost of the Shares of Stock which are purchased with funds
from such Account. Similarly, the Unallocated Funds shall be reduced by the
cost of the Shares of Stock which are purchased with Unallocated Funds or,
in the event of a distribution of cash pursuant to Section 5.3, the cost of
the fractional Shares of Stock which are transferred out of Individual
Shares Accounts thus becoming Unallocated Shares. For purposes of adjusting
the accounts, the cost of Shares of Stock shall be deemed to be the weighted
average purchase price (including brokerage and other fees directly related
thereto) of all Shares of Stock purchased for the Reporting Month to which
the Allocation Date relates. Shares of Stock held as Unallocated Shares (as
a result of forfeitures or for any other reason) which are transferred to
Individual Shares Accounts shall be deemed to have been purchased by the
Plan at a price equal to (1) the closing market value on the last business
day of the Reporting Month to which the forfeiture relates in the case of
Shares of Stock which were held as Unallocated Shares as a result of
forfeiture, (2) the closing market value on the date of surrender in the
case of Shares of Stock which were held as Unallocated Shares as a result of
surrender pursuant to Section 5.3 or 8.1, and (3) the weighted average
purchase price (including brokerage and other fees directly related thereto)
EXH 99-8
<PAGE>
of all Shares of Stock purchased for the Reporting Month to which the event
relates in the case of Shares of Stock which were held as Unallocated Shares
as a result of an event other than forfeiture or surrender pursuant to
Section 5.3 or 8.1.
(c) Cash and Stock paid to the Trust during the month as a
dividend or Stock split with respect to Stock held by the Trust shall be
credited and allocated to accounts in accordance with Section 4.4.
(d) The forfeited portions of the Individual Fund Accounts and
Individual Shares Accounts of Participants who terminated Active Association
with the Plan Sponsor during the previous month shall become Unallocated
Funds and Unallocated Shares, respectively.
(e) All cash held as Unallocated Funds and all Shares of Stock
held as Unallocated Shares shall, in the discretion of the Plan Sponsor,
revert back to the Plan Sponsor, and upon transfer to the Plan Sponsor shall
thereupon become the sole property of the Plan Sponsor, subject only to the
Plan Sponsor's obligation to recontribute amounts to the Plan upon a
Participant's reassociation as a Participant as provided in Section 5.6.
Alternatively, the Plan Sponsor may (1) offset all or a part of the cash
held as Unallocated Funds and/or Shares of Stock held as Unallocated Shares
against the Plan Sponsor's contribution obligations under the Plan, or (2)
request that the Plan purchase Shares of Stock held as Unallocated Shares;
for purposes of (1) or (2), the Shares of Stock held as Unallocated Shares
shall be valued at a price equal to (1) the closing market value on the last
business day of the Reporting Month to which the forfeiture relates in the
case of Shares of Stock which were held as Unallocated Shares as a result of
forfeiture, (2) the closing market value on the date of surrender in the
case of Shares of Stock which were held as Unallocated Shares as a result of
surrender pursuant to Section 5.3 or 8.1, and (3) the weighted average
purchase price (including brokerage and other fees directly related thereto)
of all Shares of Stock purchased for the Reporting Month to which the event
relates in the case of Shares of Stock which were held as Unallocated Shares
as a result of an event other than forfeiture or surrender pursuant to
Section 5.3 or 8.1.
4.6 REPORTING. The Plan Sponsor shall report to each Participant the
cash and total number of Shares of Stock held in the Participant's
Individual Accounts. Such reporting shall be made quarterly, and shall be
mailed, first class mail, to each Participant who has account activity
during the subject quarter.
ARTICLE 5
VESTING, DISTRIBUTION AND FORFEITURES
5.1 VESTING AND TIMING OF DISTRIBUTIONS. Upon completing the number
of Years of Credited Service specified in paragraphs (a) and (b) below or
upon the occurrence of the events specified in paragraphs (c), (d) or (e)
below, and subject to the provisions of Sections 5.3 and 5.6, a Participant
shall become vested (subject to the provisions of Sections 3.6, 8.1, 9.1 and
10.4) in the percentage specified below of the balances, if any, of the
Participant's Individual Accounts, including any portion of such balances
deemed to be advances.
EXH 99-9
<PAGE>
(a) FIVE YEARS OF CREDITED SERVICE. On the day on which a
Participant completes five Years of Credited Service, he or she shall become
vested in 25% of the balance, if any, of his or her Individual Shares
Account. The vested amount of whole Shares (which shall include amounts
allocated to the Account for the third month of the calendar quarter in
which a Participant vests) shall be distributed to the Participant within 45
days after the end of such calendar quarter. Following such distribution,
the Participant shall have no vested interest in his or her Individual
Accounts, except as vesting may occur under paragraphs (b), (c), (d), and
(e) below.
(b) TEN YEARS OF CREDITED SERVICE. On the day on which a
Participant completes ten Years of Credited Service, he or she shall become
vested in 100% of the then existing balances, if any, of his or her
Individual Accounts. The vested amount of whole Shares (which shall include
amounts allocated to a Participant's Individual Shares Account for the third
month of the calendar quarter in which a Participant vests) shall be
distributed to the Participant within 45 days after the end of such calendar
quarter. The Participant shall thereafter be 100% vested at all times in
the balances of his or her Individual Accounts and, within 45 days after the
end of each calendar year until the Participant terminates his or her Active
Association with the Plan Sponsor, the Plan shall distribute to the
Participant the balance of the Participant's Individual Shares Account as of
the end of such year (including amounts allocated to the Account for the
twelfth month of the calendar year). Final distribution of balances of the
Participant's Individual Accounts shall be made within 45 days after the end
of the calendar quarter in which such termination occurs.
(c) AGE 65. Each Participant who, on or after the Participant's
65th birthday, terminates his or her Active Association with the Plan
Sponsor, shall be 100% vested in the balances of the Participant's
Individual Accounts on the date of termination. The vested amounts shall be
distributed to the Participant within 45 days after the end of the calendar
quarter in which the date of termination occurs.
(d) DEATH. In the event of the death of a Participant, the
Participant shall be deemed to be 100% vested in the balances of his or her
Individual Accounts on the day prior to the day of such death. The vested
amounts shall be distributed to the Participant's surviving Beneficiary, if
any, and otherwise to the Participant's estate, within 45 days after the end
of the calendar quarter in which the death of the Participant occurs.
(e) TOTAL AND PERMANENT DISABILITY. In the event of a
Participant's termination of Active Association with the Plan Sponsor by
reason of the Participant's total and permanent disability, such Participant
shall be 100% vested in the balances of his or her Individual Accounts on
the date of such termination. Disability shall mean any medically
determinable physical or mental impairment which totally disables the
Participant from performing any "compensable work" as defined by the Social
Security Act, as amended. The determination as to the existence of any
Participant's total and permanent disability shall be made solely by the
Stock Bonus Management Committee which may require such medical and other
evidence as in its judgment is necessary to make the determination. The
vested amounts shall be distributed to the Participant within 45 days after
the end of the calendar quarter in which (1) the date of termination occurs,
or (2) if later, the date on which the Stock Bonus Management Committee
determines that the Participant is totally and permanently disabled.
EXH 99-10
<PAGE>
(f) In the event of a termination pursuant to this Section 5.1,
the Participant will be credited with First-Year Premiums on Bonus Policies
prior to the end of the calendar month in which the termination date occurs,
and the Participant's Accounts will be reduced to reflect amounts
recoverable by the Plan Sponsor with respect to lapsed or cancelled Bonus
Policies (as provided for in Section 3.4(a)) and refunded First Year
Premiums (as provided for in Section 3.5) up to the last business day of the
calendar month in which the date of termination occurs.
(g) The Stock Bonus Management Committee shall determine whether
vesting has occurred under paragraphs (c), (d) and (e) of this Section 5.1
if the Participant is a corporation, partnership or other legal entity.
5.2 SPECIAL DISTRIBUTIONS. Nothing set forth in this Article 5 shall
prevent the Plan Sponsor from distributing at any time, in addition to the
distributions set forth in Section 5.1, any part or all of the balances in
the Individual Accounts of one or more Participants, subject to whatever
conditions the Plan Sponsor, in its discretion, may impose.
5.3 FORM OF DISTRIBUTIONS. In the event of a final distribution, the
Participant or Beneficiary shall receive all whole Shares of Stock credited
to the Participant's Individual Shares Account, cash in lieu of any
fractional Shares of Stock held in such Account, and the cash held in the
Participant's Individual Fund Account. If the distribution is not a final
distribution, the Participant shall receive only the whole Shares of Stock
credited to his Individual Shares Account.
5.4 DISTRIBUTIONS TO AFFILIATES. The Stock Bonus Management Committee
shall have absolute discretion to determine the form of distribution under
the Plan to a Participant or Beneficiary who is at the time of distribution
an "affiliate" of AFLAC Incorporated within the meaning of Rule 144 under
the Securities Act of 1933, as amended. The Stock Bonus Management
Committee shall determine which Participants and Beneficiaries are covered
by this provision. In so doing, the Stock Bonus Management Committee shall
take into account any information and conclusions furnished to it by the
Plan Sponsor and AFLAC Incorporated, and may in its discretion seek advice
of counsel.
5.5 FORFEITURES.
(a) Subject to the provisions of Section 5.1, any portion of a
Participant's Individual Accounts which is not vested on the date the
Participant's Active Association with the Plan Sponsor is terminated, shall
be forfeited.
(b) Notwithstanding any provision to the contrary in this Plan,
in the event that a Participant's Active Association with the Plan Sponsor
is terminated for cause in accordance with the terms and provisions of the
written contract or agreement between such Participant and the Plan Sponsor,
neither the Participant nor the Beneficiary of the Participant (nor any
person claiming on behalf of such Participant or Beneficiary) shall be
entitled to receive any distribution or other benefits under this Plan.
5.6 VESTING UPON REASSOCIATION. If a Participant's Active Association
with the Plan Sponsor is terminated, and the Participant subsequently again
enters into Active Association with the Plan Sponsor, the following rules
shall apply:
EXH 99-11
<PAGE>
(a) BREAK OF LESS THAN 12 MONTHS. In the event that the
Participant's Break in Service is for a period of less than twelve (12)
consecutive months, then:
(1) On the first Allocation Date occurring after the
Participant again enters into Active Association with the Plan Sponsor, the
Participant's Individual Fund Account shall be credited with the
Participant's Forfeited Amount, and
(2) All of the Participant's Years of Credited Service prior
to the Break in Service shall be counted for purposes of computing Years of
Credited Service.
(b) BREAK OF 12 MONTHS OR MORE. In the event the Participant's
Break in Service is equal to or greater than twelve (12) consecutive months,
then:
(1) When the Participant again enters into Active
Association with the Plan Sponsor, his or her Individual Accounts shall not
be credited with the Forfeited Amount, and
(2) All of the Participant's Years of Credited Service prior
to the Break in Service shall be counted for purposes of computing Years of
Credited Service.
5.7 VESTING, DISTRIBUTION AND FORFEITURES FOR SPECIAL ASSOCIATES.
Notwithstanding anything to the contrary in this Article 5, if the written
agreement between the Plan Sponsor and a Special Associate includes
provisions regarding vesting, distribution and forfeiture of benefits which
are inconsistent with the provisions of this Article 5, the provisions of
such written agreement shall govern with respect to such Special Associate.
ARTICLE 6
ADMINISTRATION OF PLAN
6.1 ADMINISTRATION.
(a) The Stock Bonus Management Committee shall administer and
have complete control of the Plan, subject to the provisions hereof, with
all powers necessary to enable it properly to carry out its duties in that
respect. Not in limitation, but in amplification of the foregoing, the
Stock Bonus Management Committee shall have the power to construe the Plan
and to determine all questions that may arise hereunder, including all
questions relating to the eligibility of Associates, Soliciting Brokers,
Sales Coordinators or Special Associates to participate in the Plan and the
amount of benefit to which any Participant or Beneficiary may become
entitled hereunder. The decision of the Stock Bonus Management Committee
upon all matters within the scope of its authority shall be final.
(b) The Stock Bonus Management Committee may establish uniform
rules and procedures to be followed by Participants and their Beneficiaries
regarding any matter required to administer the Plan.
(c) The Stock Bonus Management Committee shall prepare and
distribute information concerning the Plan to the Participants in such
manner as it shall deem appropriate and as required by law.
EXH 99-12
<PAGE>
(d) The Stock Bonus Management Committee shall be entitled to
rely upon all certificates and reports, if any, furnished by the consultant
or actuary of the Plan Sponsor, and upon all opinions given by any legal
counsel, accountant or doctor selected or approved by the Plan Sponsor; any
action taken or suffered by the Stock Bonus Management Committee in good
faith in reliance upon the advice or opinion of such consultant, actuary,
legal counsel, accountant or doctor shall be conclusive upon each of them
and upon all Participants, Beneficiaries or other persons interested in the
Plan.
6.2 RECORDS. All material acts and determinations of the Stock Bonus
Management Committee shall be duly recorded and all such records, together
with such other documents as may be necessary for the administration of the
Plan, shall be preserved in the custody of the Plan Sponsor. The Plan
Sponsor shall provide all necessary forms, and accounting, clerical and
other such services required to carry out the proper administration of the
Plan.
6.3 FINANCIAL STATEMENTS. The Trustees shall cause financial
statements of the Trust to be prepared annually and at such other times as
they deem appropriate. All accounting for the Trust shall be on an accrual
basis.
6.4 DELEGATION OF AUTHORITY AND EXEMPTION FROM LIABILITY. The
administrative duties and responsibilities set forth in this Article 6 may
be delegated by the Stock Bonus Management Committee in whatever manner and
to whatever extent it chooses to such persons as the Stock Bonus Management
Committee selects. To the extent permitted by law, the Plan Sponsor shall
indemnify and hold harmless the Trustees, each member of the Stock Bonus
Management Committee, any member of the Board of Directors of the Plan
Sponsor, and any other party acting with respect to the Plan at the request
of the Plan Sponsor or the Stock Bonus Management Committee, against any and
all claims, demands, suits, loss, damages, expense and liability arising
from any act or failure to act with respect to the Plan, including any act
or failure to act which is deemed to be a breach of such individual's
fiduciary responsibilities, unless the same is determined to be due to gross
negligence or willful misconduct.
ARTICLE 7
AMENDMENT AND TERMINATION OF PLAN
7.1 AMENDMENT OF THE PLAN. The Plan Sponsor shall have the right at
any time to modify, alter, or amend the Plan in whole or in part by
instrument in writing duly executed; provided, however, that unless it is
necessary to meet the requirements of any state or federal law or
regulation, no amendment shall (i) cause or permit any part of the Trust to
be used for, or diverted to, purposes other than the exclusive benefit of
the Participants or their Beneficiaries (subject to the provisions of
Section 9.1 hereof), (ii) have the effect of revesting in or causing to
inure to the benefit of the Plan Sponsor any portion of the Trust (subject
to the provisions of Sections 4.5(e), 8.1 and 9.1 hereof), or (iii) operate
to deprive any Participant or Beneficiary of any vested right under this
Plan.
7.2 TERMINATION OF THE PLAN. The Plan Sponsor has adopted this Plan
with the intent that it be continued indefinitely; however, the Plan Sponsor
EXH 99-13
<PAGE>
reserves the right at any time to reduce or to discontinue permanently the
Plan Sponsor contributions to the Plan or to terminate the Plan by action of
the Board. Such reduction or permanent discontinuance of Plan Sponsor
contributions or termination may be made without the consent of the
Trustees, the Participants or their Beneficiaries, or any other persons.
7.3 DISTRIBUTION ON TERMINATION. The distribution of Plan assets on
termination of the Plan shall be determined as follows. Upon termination of
the Plan, the Plan Sponsor shall deliver a written notice of termination of
the Plan to the Trustees and shall direct the Trustees, as soon as
practicable and not later than the last day of the calendar quarter in which
the Trustees are so notified, to reduce to cash the assets of the Trust, if
any, other than the Shares of Stock held by the Trust, and to pay or provide
for all liabilities and obligations of the Trust, including the expenses of
the distribution and other expenses and liquidation costs of the Plan and
Trust. If the amount of Unallocated Funds is insufficient to pay or provide
for any liabilities and expenses, such liabilities and expenses shall be
paid or provided for out of Unallocated Shares. If Unallocated Funds and
Unallocated Shares are exhausted, liabilities and expenses may be paid first
from the Individual Fund Accounts, on a pro rata basis, and, if necessary,
then from the Individual Shares Accounts, on a pro rata basis. The balance
of all Individual Accounts shall be brought up to date in accordance with
Section 4.5 as of the last day of the calendar quarter in which the Trustees
are notified of the termination, after payment or provision for all
liabilities and expenses as aforesaid. Upon completion of such accounting,
the Trustees shall disburse to each Participant or Beneficiary, as the case
may be, the full amount then standing to his credit in his Individual Fund
Account and the full number of Shares of Stock then standing to his credit
in his Individual Shares Account, including any portion of such balances
deemed to be advances; provided that cash shall be distributed in lieu of
any fractional Shares of Stock held in any Individual Shares Account.
ARTICLE 8
PLAN SPONSOR'S RIGHT OF SETOFF AGAINST
PARTICIPANT'S VESTED BENEFITS
8.1 RIGHT OF SETOFF; GRANT OF SECURITY INTEREST. Subject to any
applicable legal limitations, the Plan Sponsor shall have the right to
charge against any benefits owed to a Participant under this Plan the amount
of certain obligations of such Participant to the Plan Sponsor. The Plan
Sponsor may exercise such right by notifying the Trustees of the claim and
the exercise of such right, and directing that the Trustees promptly deliver
to the Plan Sponsor all or a part of the Plan assets held in the Trust for
such Participant (or his Beneficiary). The Trustees shall thereupon, and
without further notice to such Participant (or his Beneficiary), deliver
such Plan assets to the Plan Sponsor for application against obligations
owed to the Plan Sponsor by the Participant. For purposes of this Section
8.1, "obligations" shall include any indebtedness of the Participant to the
Plan Sponsor including, but not limited to, any advances (including advances
pursuant to Section 3.2 of this Plan), loans, unearned commissions or
credits made by or from the Plan Sponsor to the Participant. In addition,
the Plan Sponsor shall have a lien against Plan assets or benefits which
have, or may become, due to such Participant (or his Beneficiary) under this
Plan, which lien shall be a first lien in favor of the Plan Sponsor as to
such assets or benefits. In consideration of the right to participate in
this Plan and for the benefits paid hereunder to the Participant and each
EXH 99-14
<PAGE>
Beneficiary by the Plan Sponsor, each Participant and each Beneficiary
grants and assigns the Plan Sponsor a security interest in all assets,
rights and benefits which have, or may become, due to the Participant or
Beneficiary pursuant to this Plan.
ARTICLE 9
RIGHTS OR CREDITORS OF PLAN SPONSOR AND AFLAC INCORPORATED
9.1 CREDITORS' RIGHTS UPON INSOLVENCY. Notwithstanding anything to
the contrary herein, in the event of the insolvency of the Plan Sponsor, all
assets contributed to the Trust on or after October 1, 1992, including any
Forfeited Amount that is credited to a Participant's Individual Fund Account
on or after October 1, 1992, and income thereon then held pursuant to the
Trust shall be available for satisfaction of the claims of the general
creditors of the Plan Sponsor in accordance with state and federal laws;
provided, however, that any cash and stock dividends on assets contributed
to the Trust prior to October 1, 1992 and any contributions that are made as
the result of stock splits of Shares of Stock held in the Trust prior to
October 1, 1992 shall not be subject to such claims regardless of whether
such dividends or contributions occur on or after October 1, 1992. For
purposes of this Section, the Plan Sponsor shall be considered insolvent if
it is either (i) unable to pay its debts as they become due, or (ii) subject
to a pending proceeding as a debtor under the United States Bankruptcy Code.
ARTICLE 10
MISCELLANEOUS
10.1 HEADINGS. The headings and subheadings in the Plan have been
inserted for convenience of reference only and are to be ignored in any
construction of the provisions hereof.
10.2 CONSTRUCTION. In the construction of the Plan, the masculine
shall include the feminine and the singular the plural in all cases where
such meanings would be appropriate. The Plan shall be construed in
accordance with the laws of the State of Georgia.
10.3 INCORPORATION, ETC. In the event that an individual
Participant's business as an Associate is transferred to a corporation,
partnership, or other legal entity that becomes an Associate and Participant
hereunder, such entity shall, if the Stock Bonus Management Committee so
determines, succeed to the individual Participant's benefits and rights
hereunder, and the entity's Years of Credited Service may, at the Stock
Bonus Management Committee's discretion, include the individual's service as
an Associate. Conversely, in the event that an Associate that is a
corporation, partnership, or other legal entity ceases to be an Associate,
any individual Associate who succeeds to the business of that entity shall,
if the Stock Bonus Management Committee so determines, succeed to the
benefits and rights of that entity hereunder, and such individual
Associate's Years of Credited Service may, at the Stock Bonus Management
Committee's discretion, include the entity's service as an Associate.
10.4 SPENDTHRIFT CLAUSE. Except as provided in the Plan or as
otherwise required by law, no benefits under the Plan shall be subject in
any manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance or charge and any attempt to so anticipate, alienate, sell,
EXH 99-15
<PAGE>
transfer, assign, pledge, encumber or charge shall be void; provided,
however, that an Associate may pledge his benefits to the AFLAC Federal
Credit Union to secure a loan. No such benefit shall in any manner be
liable for or subject to the debts, contracts, liabilities, engagements, or
torts of the person entitled to such benefit except as specifically provided
in the Plan.
10.5 LEGALLY INCOMPETENT. If any Participant or Beneficiary is a
minor, or is in the judgment of the Stock Bonus Management Committee
otherwise legally incapable of personally receiving and giving a valid
receipt for any payment due him hereunder, the Stock Bonus Management
Committee may, unless and until claim shall have been made by a guardian of
such person duly appointed by a court of competent jurisdiction, direct that
payment or any part thereof be made to such person or to such person's
spouse, child, parent, brother or sister, or other person deemed by the
Stock Bonus Management Committee to be a proper person to receive such
payment. If the Stock Bonus Management Committee is unable, after
reasonable effort, to ascertain the identity, whereabouts or existence of
any Participant or Beneficiary to whom a benefit is payable under this Plan,
the benefits otherwise payable to such person shall be forfeited, anything
to the contrary contained elsewhere in this Plan notwithstanding. However,
if a claim is subsequently made by such person, or if satisfactory proof of
death of such person is received by the Stock Bonus Management Committee,
the Plan Sponsor shall make a contribution to the Plan which,
notwithstanding any provision of this Plan to the contrary, shall be for and
so as to enable such benefit to be paid to such person or his Beneficiary,
as the case may be. Any benefits lost by reason of escheat under applicable
state law shall also be forfeited, but shall not be subject to
reinstatement.
10.6 ARBITRATION. Any dispute arising under this Plan, to the maximum
extent allowed by applicable law, shall be subject to arbitration, and prior
to commencing any court action the Trustees, Participants or Beneficiaries,
as the case may be, shall submit all controversies to arbitration. The
arbitration shall be conducted pursuant to the terms of the Federal
Arbitration Act. The award of the arbitrator(s) shall be binding and
conclusive on the parties, in the absence of fraud or corruption, and each
party shall have the right to have the award made the judgment of a court of
competent jurisdiction.
10.7 CORRECTION OF ERRORS. If any change in records or error results
in any Participant or Beneficiary being credited with or receiving from the
Plan more or less than the person would have been entitled to had the
records been correct or had the error not been made, the Stock Bonus
Management Committee, upon discovery of such error, shall adjust, as far as
practicable, the account or payments, as the case may be, in such a manner
as to correct the error. Any Plan Sponsor contribution made by mistake of
fact shall be returned to the Plan Sponsor.
10.8 EXCLUSIVE BENEFIT. Except as otherwise specifically provided in
this Plan, all assets of the Plan and Trust and all contributions of the
Plan Sponsor under the Plan shall be held and used for the exclusive purpose
of providing benefits for Participants and Beneficiaries, and no portion of
the Trust shall inure to the benefit of or revert to the Plan Sponsor.
10.9 LIABILITY OF PLAN SPONSOR AND AFLAC INCORPORATED.
Notwithstanding any provision to the contrary in this Plan or the Amended
EXH 99-16
<PAGE>
and Restated Trust Agreement, the Plan Sponsor shall at all times remain
liable to each Participant and his Beneficiary for the payment of any vested
amounts distributable pursuant to the terms of this Plan to such Participant
or his Beneficiary which are not so distributed by the Trust in accordance
with the terms of this Plan. In addition, AFLAC Incorporated hereby
guarantees the payment of such amounts.
10.10 PARTIAL INVALIDITY. If any provision of this Plan is held
invalid or unenforceable, its invalidity or unenforceability shall not
affect any other provision and this Plan shall be construed and enforced as
if such provision had not been included.
EXH 99-17
<PAGE>
IN WITNESS WHEREOF, the Plan Sponsor has caused the Plan to be signed
and adopted, as amended and restated, this 10th day of November, 1992,
effective as of October 1, 1992.
AMERICAN FAMILY LIFE ASSURANCE
COMPANY OF COLUMBUS
By: /s/ Daniel P. Amos
-----------------------------------
President
Attest: /s/ Joey M. Loudermilk
--------------------------------
Secretary
IN WITNESS WHEREOF, AFLAC Incorporated hereby agrees and consents to
the provisions of Section 10.9 hereof as of this 10th day of November, 1992,
effective as of October 1, 1992.
AFLAC INCORPORATED
By: /s/ Daniel P. Amos
-----------------------------------
President
Attest: /s/ Joey M. Loudermilk
--------------------------------
Secretary
IN WITNESS WHEREOF, the Trustees of the AFLAC Associate Stock Bonus
Plan acknowledge receipt of the Plan as signed and adopted, as amended and
restated, the day affixed next to their name, effective as of October 1,
1992.
November 10, 1992 /s/ Paul S. Amos
- ----------------------------- --------------------------------
Date Paul S. Amos, Trustee
November 10, 1992 /s/ Louis A. Hazouri, Jr.
- ----------------------------- --------------------------------
Date Louis A. Hazouri, Jr., Trustee
November 10, 1992 /s/ Daniel P. Amos
- ----------------------------- --------------------------------
Date Daniel P. Amos, Trustee
EXH 99-18
<PAGE>
TRUST AGREEMENT
THIS AMENDED AND RESTATED TRUST AGREEMENT (the "Agreement"), dated
October 1, 1992, entered into by and between American Family Life Assurance
Company of Columbus ("Plan Sponsor"), an insurance corporation organized
under the laws of the State of Georgia with its principal office in
Columbus, Georgia and Paul S. Amos, Louis A. Hazouri, Jr. and Daniel P.
Amos, the Trustees (hereinafter called individually "Trustee" and
collectively the "Trustees"),
W I T N E S S E T H T H A T:
WHEREAS, the Plan Sponsor has adopted the AFLAC Associate Stock Bonus
Plan for the benefit of Participants and their Beneficiaries as defined in
said Plan;
WHEREAS, said Plan provides that investment of all contributions made
to said Plan and payment of benefits thereunder will be accomplished by a
Trust Agreement, as it may be amended from time to time, which shall
constitute a part of said Plan, and
WHEREAS, the Plan Sponsor has amended and restated, as of October 1,
1992, said Plan (hereinafter, as so amended and restated, called the
"Plan"), and it is desired to so amend and restate the related Trust
Agreement between the Plan Sponsor and the Trustees.
NOW THEREFORE, in consideration of the premises and the further
obligations and undertakings hereinafter set forth, it is agreed as follows:
ARTICLE 1
THE TRUST
(a) The Plan Sponsor, in accordance with the terms of the Plan, which
Plan is made a part of this Agreement, hereby establishes with the Trustees,
a trust which shall be designated the AFLAC Associate Stock Bonus Trust
(hereinafter called the "Trust"), in which the Trustees shall hold such
cash, securities and other property as shall from time to time constitute
the assets of the Plan (hereinafter called the "Fund"). The Fund shall be
held, managed, and administered by the Trustees in trust for the purpose of
discharging the Plan Sponsor's legal obligations under the Plan and in
accordance with the Plan and the provisions of this Agreement. The Trust is
intended to be a grantor trust, of which the Plan Sponsor is the grantor,
within the meaning of subpart E, part I, subchapter J, chapter 1, subtitle
A, of the Internal Revenue Code of 1986, as amended from time to time, and
shall be construed accordingly.
(b) Subject to the right of the Plan Sponsor as set forth in the Plan
to charge against the Trust assets in order to satisfy obligations owed to
the Plan Sponsor by a Participant (whether arising under this Plan or
otherwise) and to the right of creditors of the Plan Sponsor to assert
claims against assets of the Trust that were contributed to the Trust on or
after October 1, 1992 and the income thereon held pursuant to the Trust in
the case of the Insolvency of the Plan Sponsor (as herein defined), the
Trustees shall discharge their duties hereunder solely in the interests of
EXH 99-19
<PAGE>
the Participants and Beneficiaries of the Plan, for the exclusive purpose of
providing benefits to Participants and Beneficiaries and defraying certain
specified expenses of the Plan. Such duties shall be discharged with the
care, skill, prudence and due diligence under the circumstances then
prevailing that a prudent man acting in the like capacity and familiar with
such matters would use in the conduct of an enterprise with like aims.
Prior to the satisfaction of all liabilities with respect to benefits of
Participants and Beneficiaries, no part of the corpus or income of the Fund
other than (i) such part as is required to pay taxes and expenses as set
forth in Article 9 hereof, (ii) such part as is permitted to be reached by
the creditors of the Plan Sponsor in the event of Insolvency as set forth in
Article 6 hereof, or (iii) such part as is permitted to be paid to the Plan
Sponsor or to charge against amounts owed by the Participant to the Plan
Sponsor pursuant to the provisions of the Plan, shall be used for, or
diverted to, purposes other than the exclusive benefit of such Participants
and Beneficiaries.
(c) To the extent permitted by law, the Trustees shall not be liable
for the making, retention, or sale of any investment or reinvestment of
assets of the Fund made by them nor for any loss to or diminution of the
Fund, and the Trustees, and each Trustee, shall be free from all liability,
joint or several, for their acts, omissions and conduct, and for the acts,
omissions and conduct of their duly constituted agents, in the
administration of the Trust. The Plan Sponsor shall indemnify and save
them, and each of them, harmless from effects and consequences of their
acts, omissions and conduct in their official capacity, except to the extent
that such effects and consequences shall result from their own willful
misconduct or gross negligence.
(d) In addition to every power and discretion conferred upon the
Trustees by any other provisions of this Agreement, the Trustees will have
all the usual powers conferred by law on trustees; provided, however, that
if an insurance policy is held as an asset of the Trust, the Trustees shall
have no power to name a beneficiary of the policy other than the Trust, to
assign the policy (as distinct from conversion of the policy to a different
form) other than to a successor Trustee, or to loan to any person the
proceeds of any borrowing against such policy. The duties and obligations
of the Trustees with respect to the Plan and Trust are limited to those
assumed by the Trustees by the terms of this Agreement and imposed by
applicable law or regulation. The Trustees shall not be deemed by virtue
hereof to be Administrator or Sponsor of the Plan, and shall not be
responsible for receiving any order or consent of any court, for filing any
reports, returns or disclosures with any government agency, for reporting to
any court, or for giving any bond.
(e) Each Trustee, by accepting this Trust, hereby acknowledges that he
has received notification of the Plan Sponsor's lien and security interest
in the Trust assets for the purpose of satisfying obligations the
Participant may owe the Plan Sponsor.
ARTICLE 2
CONTRIBUTIONS TO TRUSTEES
Contributions shall be paid by the Plan Sponsor into the Fund from time
to time in accordance with the terms of the Plan. It shall be the duty of
the Trustees to receive, hold, invest and reinvest the assets of the
EXH 99-20
<PAGE>
Fund, to collect all interest, dividend and other income thereon, to hold
the assets from time to time constituting the Fund under such conditions of
custody and safekeeping as the Trustees shall deem appropriate for the
particular type of asset, to make payments to the Plan Sponsor as permitted
pursuant to the Plan or this Agreement, to make payments to creditors of the
Plan Sponsor as permitted pursuant to the Plan or this Agreement, and to
make payments and distributions from the Fund, all in accordance with the
provisions of this Agreement and the Plan. The Trustees shall be under no
duty to enforce payment of any contribution to the Fund, and shall be
accountable only for money, securities and other property actually received
by them.
ARTICLE 3
MANAGEMENT OF FUND
(a) In accordance with the provisions of the Plan, the funding policy
of the Trust shall be to invest wholly in shares of Common Stock of AFLAC
Incorporated (the "Stock"), but in the event that Stock is not available or
cannot be purchased, temporarily, under any applicable law, then and in that
event the Trustees shall invest the assets of the Fund in cash or cash
equivalents.
(b) Neither by way of limitation nor in derogation but in
amplification of any powers granted herein, the Trustees are further
authorized:
(1) to hold cash awaiting investment and to keep such portion of
the Fund in cash or cash balances in such amounts as the Trustees may from
time to time deem to be reasonable and necessary to meet anticipated
distributions or costs without liability for interest or to be otherwise in
the best interest of the Trust;
(2) to sell for cash or credit, redeem, exchange for other
property, convey, transfer or otherwise dispose of any property held in the
Fund in any manner and at any time, by private contract or at public auction
or otherwise;
(3) to enter into contracts for or to make commitments either
alone or in company with others to purchase or sell at any future date any
property acquired for the Fund;
(4) to vote or to refrain from voting upon any stocks, bonds or
other securities held in the Fund, to give general or special proxies or
powers of attorney with or without power of substitution with respect to
such securities (provided, however, that if the Plan Sponsor or AFLAC
Incorporated has entered into any binding agreement with respect to the
manner in which shares of Stock held in the Plan shall be voted, the
Trustees shall vote such shares of Stock in accordance with such agreement),
to exercise any conversion privileges, subscription rights or other options
or privileges with respect to such securities and make any payments
incidental thereto, to oppose or consent to or otherwise participate in
corporate reorganizations or other changes affecting corporate securities
held in the Fund, delegate discretionary powers, deposit securities under a
deposit agreement, pay any assessments or charges in connection therewith,
and accept, hold and retain any securities or other property which may be so
acquired, and generally to exercise, personally or by general or limited
EXH 99-21
<PAGE>
power of attorney, any of the powers of an owner with respect to stocks,
bonds, securities or other property held in the fund at any time;
(5) to register any investment of the Fund in their own name or
in the name of a nominee or nominees and to hold any investment in bearer
form, to deposit or arrange for the deposit of such securities in a
qualified central depository even though, when so deposited, such securities
may be merged and held in bulk in the name of the nominee of such depository
with other securities deposited therein by any other person, but the books
and records of the Trustees shall at all times show that all such
investments are part of the Fund;
(6) to enforce by suit or otherwise or to waive any right or
claim on behalf of the Trustees or the Fund, to extend the time of payments
of any obligation at any time owing to the Fund, to sell, compromise, adjust
or submit to arbitration any claim or right in favor of or against the
Trustees or the Fund, to commence or defend suits or legal proceedings
whenever in the Trustees' judgment any interest of the Fund requires it, and
to represent the Fund in all suits or legal proceedings in any court of law
or equity or before any body or tribunal;
(7) to employ suitable consultants, depositories, agents, legal
counsel and auditors, provided that the reasonable expenses and compensation
incurred in connection therewith shall be paid by the Plan Sponsor;
(8) to construe this Agreement and determine all questions that
may arise hereunder, and to establish such rules, regulations and procedures
as they deem to be required to administer the Trust in accordance with
provisions of the Plan and the Trust and applicable laws; and
(9) to do any and all acts and things, including but not limited
to making, executing, acknowledging and delivering any and all documents of
transfer and conveyance and any and all other instruments, such as
contracts, waivers, or releases, which they may deem necessary or proper and
to exercise any and all powers herein granted.
(c) Notwithstanding any powers granted to the Trustees pursuant to
this Trust Agreement or applicable law, the Trustees shall not have any
power that could give this Trust the objective of carrying on a business and
dividing the gains therefrom, within the meaning of Section 301.7701-2 of
the Procedure and Administrative Regulations promulgated pursuant to the
Internal Revenue Code.
ARTICLE 4
VALUATION
For each calendar quarter, as the Plan Sponsor may request in writing,
and as may be required by law, the Trustees shall report to the Plan Sponsor
in writing the value of the Fund and the balances of all accounts maintained
under the Plan in terms of the number of shares of Stock, the fair market
value, as determined by the Trustees, of the balance of other investments,
including any cash, and the amount of any liabilities or obligations of the
Trust.
EXH 99-22
<PAGE>
ARTICLE 5
DISBURSEMENTS
The Trustees shall make payments from the Fund to such persons, in such
manner and in such amounts as the Plan Sponsor may direct in writing from
time to time. The Trustees shall be fully protected in acting upon any such
written direction without inquiry or investigation, and shall have no duty
or authority to determine the rights or benefits of any Participant and
Beneficiary under the Plan, or to inquire into the right or power of the
Plan Sponsor to direct any payment from the Fund. If any check in payment
of a benefit hereunder, which had been mailed by regular U.S. mail to the
last address of the payee, is returned undelivered, the Trustees shall so
notify the Plan Sponsor and shall discontinue further payments to such payee
until they receive further instructions from the Plan Sponsor. The Trustees
shall have no duty to locate Participants and Beneficiaries.
ARTICLE 6
INSOLVENCY
(a) The Plan Sponsor shall be considered "Insolvent" for purposes of
this Trust Agreement if it is (i) unable to pay its debts as they become
due, or (ii) subject to a pending proceeding as a debtor under the United
States Bankruptcy Code.
(b) At all times during the continuance of this Trust, as provided in
Article 1(f) hereof, the assets contributed to the Trust on or after October
1, 1992 and the income thereon held pursuant to the Trust shall be subject
to claims of general creditors of the Plan Sponsor under federal and state
law as set forth below.
(1) The Board of Directors and the Chief Executive Officer of the
Plan Sponsor shall have the duty to inform the Trustees in writing of the
Insolvency of the Plan Sponsor. If a person claiming to be a creditor of
the Plan Sponsor alleges in writing to the Trustees that the Plan Sponsor
has become Insolvent, the Trustees shall determine whether the allegation is
true and, pending such determination, the Trustees shall discontinue payment
of benefits to Participants and Beneficiaries of assets contributed on or
after October 1, 1992 and the income thereon held pursuant to the Trust.
(2) Unless the Trustees have actual knowledge of the Insolvency
of the Plan Sponsor, or have received notice from the Plan Sponsor or a
person claiming to be a creditor alleging the insolvency of the Plan Sponsor
or AFLAC Incorporated, the Trustees shall have no duty to inquire whether
the Plan Sponsor is Insolvent. The Trustees may in all events rely on such
evidence concerning solvency as may be furnished to the Trustees and that
provides the Trustees with a reasonable basis for making a determination
concerning solvency.
(3) If at any time the Trustees have determined that the Plan
Sponsor is Insolvent, the Trustees shall (i) discontinue payments to
Participants and Beneficiaries under this Trust Agreement of assets
contributed on or after October 1, 1992 and the income thereon held pursuant
to the Trust and (ii) hold such assets together with the accumulated income
thereon then held pursuant to the Trust for the benefit of the Plan
Sponsor's general creditors. Nothing in this Trust Agreement shall in any
way diminish any rights of Participants or their Beneficiaries to pursue
their rights as general creditors of the Plan Sponsor with respect to
benefits due under the Plan or otherwise.
EXH 99-23
<PAGE>
(4) The Trustees shall resume the payment of benefits to
Participants and Beneficiaries of assets contributed on or after October 1,
1992 and the income thereon held pursuant to the Trust in accordance with
the terms of this Trust Agreement only after the Trustees have determined
that the Plan Sponsor is not Insolvent (or is no longer Insolvent).
(c) Provided there are sufficient assets, if the Trustees discontinue
the payment of benefits from the Trust pursuant to Article 6(b) hereof and
subsequently resume such payments, the first payment following such
discontinuance shall include the aggregate amount of all payments due to
Participants or Beneficiaries under the terms of the Plan for the period of
such discontinuance that were not made, less the aggregate amount of any
payments made to Participants or Beneficiaries by the Plan Sponsor or AFLAC
Incorporated in lieu of the payments provided for hereunder during any such
period of discontinuance.
ARTICLE 7
SPENDTHRIFT CLAUSE
Except for obligations which may be owed to the Plan Sponsor, as to
which obligations benefits may, subject to any applicable legal limitations,
be applied by the Plan Sponsor, no benefits under the Plan shall be subject
in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance, or charge, and any attempt to so anticipate, alienate,
sell, transfer, assign, pledge, encumber or charge shall be void. No such
benefit shall in any manner be liable for or subject to the debts, contract,
liabilities, engagements or torts of the person entitled to such benefit
except as specifically provided in the Plan.
ARTICLE 8
ACCOUNTING BY TRUSTEES
(a) The Trustees shall keep accurate and detailed accounts of all
investments, receipts, disbursements and other transactions hereunder,
including all transactions in all accounts maintained under the Plan, and
all accounts, books and records relating thereto shall be open to inspection
and audit at all reasonable times by any person designated by the Plan
Sponsor. For each calendar year, the Trustees shall file with the Plan
Sponsor a written statement setting forth all investments, receipts,
disbursements and other transactions, and all adjustments to all the
accounts maintained under the Plan, effected since the previous statement.
Such a statement setting forth all investments, receipts, disbursements and
other transactions shall also be filed within 60 days after the death,
removal or resignation of all the Trustees at one time. The Plan Sponsor
shall, upon request, be entitled to further statements or statements at more
frequent intervals from the Trustees, provided that such additional
accounting is reasonable or is necessary to enable the Plan Sponsor to
determine compliance of the Trustees with applicable laws and regulations.
(b) Except to the extent otherwise provided by applicable law, no one
other than the Plan Sponsor may require the Trustees to account or may
institute an action or proceeding to account against the Trustees or the
Fund, provided, however, that nothing herein shall in any way limit the
Trustees' right to bring any action or proceeding to settle their account or
for such other relief as they may deem appropriate.
EXH 99-24
<PAGE>
(c) Upon the expiration of 90 days from the date of filing by the
Trustee with the Plan Sponsor of a statement of accounting with respect to
the Trust, the Trustees shall, to the extent permitted by law, be forever
released and discharged from all liability and accountability to anyone with
respect to the propriety of their acts and transactions shown in such
statement, except with respect to any acts or transactions as to which the
Plan Sponsor shall file with the Trustees written objection within such 90-
day period.
ARTICLE 9
EXPENSES
The expenses incurred by the Plan Sponsor in the installation,
administration and revision of the Plan and in the installation and revision
of this Agreement, including fees for legal, accounting, actuarial or other
professional services rendered to the Trustees in connection therewith, and
such compensation, if any, to the Trustees as may be agreed upon in writing
from time to time between the Plan Sponsor and the Trustees, shall be paid
by the Plan Sponsor. Expenses incurred by the Trustees in the performance
of their duties and all other proper charges and disbursements of the
Trustees, authorized by the Trustees, shall be paid for by the Plan Sponsor.
All commissions and fees on acquisitions or dispositions of securities and
similar expenses of investment and reinvestment of the Fund, and all taxes
of any and all kinds whatsoever that may be levied or assessed under
existing or future laws upon or in respect of the Fund or the income thereof
shall be paid from the Fund.
ARTICLE 10
TRUSTEES
(a) The Trustees shall be three in number and shall be elected by the
Board of Directors of the Plan Sponsor. Each Trustee shall serve a term of
four years.
(b) A Trustee may resign at any time upon 60 days written notice
delivered to the other Trustees and the Board. A Trustee may be removed by
the Board upon written notice to the Trustee by the Board.
(c) Upon the resignation, death or removal of a Trustee, the Board
shall elect a Successor Trustee to serve the unexpired term. Upon the
expiration of the term of a Trustee, the Board shall elect a Successor
Trustee to serve a term of eight years. Upon acceptance in writing of
appointment as a Successor Trustee, such Successor Trustee shall succeed to
the powers, duties and responsibilities of the former Trustee as fully as if
he had been originally named as a Trustee hereunder.
(d) In the event that all of the Trustees die, are removed or resign
at any one time, and successors are appointed hereunder, the Trustees shall
assign, transfer and pay over to such successors the funds and properties
then constituting the Fund, or the Plan Sponsor shall promptly establish an
alternative funding medium and the Trustees shall assign, transfer and pay
over the Fund, as then constituted, upon the directions of the Plan Sponsor.
The Trustees shall continue to have the powers and duties as set forth in
this Agreement until the assets constituting the Fund have been forwarded to
Successor Trustees or an alternative funding medium.
EXH 99-25
<PAGE>
(e) Action by the Trustees shall be upon the majority vote of all the
Trustees, and the Trustees shall maintain minutes of all meetings of the
Trustees; provided, however, that a Trustee who is also a Participant or
Beneficiary under the Plan shall not vote upon matters relating specifically
to his or her benefits under the Plan.
ARTICLE 11
AMENDMENT AND TERMINATION
(a) The Plan Sponsor reserves the right at any time and from time to
time to amend, in whole or part, any or all of the provisions of this
Agreement by written instrument signed by the Plan Sponsor and delivered to
and acknowledged by the Trustees, provided that no amendment which affects
the rights, duties or responsibilities of the Trustees may be made without
their written consent, and provided further that unless it is necessary to
meet the requirements of any state or federal law or regulation, no
amendment shall authorize or permit, at any time prior to the satisfaction
of all liabilities with respect to benefits of Participants and their
Beneficiaries, any part of the corpus or income of the Fund, other than as
specifically provided in the Plan or in this Agreement, to be used for, or
diverted to, purposes other than for the exclusive benefit of such
Participants and Beneficiaries.
(b) The Plan Sponsor reserves the right at any time to terminate the
Plan as to any or all of the companies constituting the Plan Sponsor, upon
written notice to the Trustees. Upon receipt of such notice, the Trustees
shall continue to administer the Fund as herein provided and shall
distribute the Fund at such time and manner as the Plan Sponsor shall
determine in accordance with the terms of the Plan and notify the Trustees
in writing. Following distribution of the entire Fund, this Agreement shall
terminate.
ARTICLE 12
MISCELLANEOUS
(a) Unless the context of this Agreement clearly indicates otherwise,
all terms defined in the Plan shall have the same meaning herein.
(b) If any provision of this Agreement shall be held legally invalid
or unenforceable, such invalidity or unenforceability shall not affect any
other provisions hereof, and the remainder of this Agreement shall continue
in effect and be construed and enforced as if such provision had not been
included.
(c) This Agreement shall be administered, construed and enforced
according to the laws of the State of Georgia.
(d) Whenever the words "Plan Sponsor" are used herein, they shall be
construed to include the Stock Bonus Management Committee appointed in
accordance with the provisions of the Plan.
(e) When the Plan Sponsor gives instructions, requests, directions,
requisitions or moneys or certificates to the Trustees, said communications
shall be in writing, signed by such person as may have been previously
designated in writing by the Plan Sponsor to sign on its behalf, unless
EXH 99-26
<PAGE>
otherwise agreed by the Trustees. When receiving a communication as
provided for in the preceding sentence, the Trustees shall be entitled to
rely thereon as the authorized action of the Plan Sponsor, and the Plan
Sponsor shall hold harmless, indemnify and defend the Trustees in respect of
any action taken by them in reliance thereon. The Trustees shall incur no
liability for failure to act without such a written communication.
(f) Notwithstanding any other provisions of this Agreement, the
Trustees may condition their delivery, transfer or distribution of any
assets of the Fund, or any other action which they may take or are directed
to take with respect to the Plan, Trust or Fund, upon the Trustees receiving
assurances satisfactory to them that the approval of appropriate
governmental or other authorities has been secured, that such action has
been properly approved and authorized in accordance with the Plan and this
Agreement, and that all notices or other procedures required by the Plan,
this Agreement, or applicable law have been complied with.
(g) No person dealing with the Trustees will be obligated to see to
the application for any property paid or delivered to the Trustees or to
inquire into the validity, expediency or propriety of any transaction or the
Trustees' authority to consummate the same, except as may specifically be
required by law.
(h) The persons executing this Agreement on behalf of the Plan Sponsor
certify thereby that they are authorized by the Plan Sponsor consistent with
the terms of the Plan to do so. The Plan Sponsor, by executing this
Agreement, certifies that no provision hereof is inconsistent with the terms
of the Plan, that all conditions and limitations in the Plan which would
limit the actions of the Trustees are expressly contained herein, and that
the Plan Sponsor will promptly notify the Trustees of any amendments made to
the Plan.
EXH 99-27
<PAGE>
IN WITNESS WHEREOF, the Plan Sponsor, by its duly authorized officers,
has caused this Agreement to be executed, on this 10th day of November,
1992, effective as of October 1, 1992.
AMERICAN FAMILY LIFE ASSURANCE
COMPANY OF COLUMBUS
By: /s/ Daniel P. Amos
-----------------------------------
Daniel P. Amos, CEO
Attest:
/s/ Joey M. Loudermilk
- ----------------------------------
Secretary
IN WITNESS WHEREOF, the Trustees of the AFLAC Associate Stock Bonus
Plan, by execution hereof, do hereby accept appointment as a Trustee of said
Plan the day affixed next to their name, effective as of the 1st day of
October, 1992.
November 10, 1992 /s/ Paul S. Amos
- ----------------------------- --------------------------------
Date Paul S. Amos, Trustee
November 10, 1992 /s/ Louis A. Hazouri, Jr.
- ----------------------------- --------------------------------
Date Louis A. Hazouri, Jr., Trustee
November 10, 1992 /s/ Daniel P. Amos
- ----------------------------- --------------------------------
Date Daniel P. Amos, Trustee
EXH 99-28
