SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Western National Corporation
(Name of Issuer)
Common Stock
(Title of Class of Securities)
958845109
(CUSIP Number)
Peter V. Tuters, Senior Vice President and Chief Investment Officer
American General Corporation, 2929 Allen Parkway, Houston TX 77019
(713) 522-1111
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
December 2, 1994
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box .
Check the following box if a fee is being paid with the statement X
is not required only if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.
See Rule 13d-7.)
(Continued on following pages)
Page 1 of 8 Pages
<PAGE>
13D CUSIP No. 958845109 Page 2 of 8 Pages
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
AMERICAN GENERAL CORPORATION
IRS #74-0483432
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a)
(b)
3 SEC USE ONLY
4 SOURCE OF FUNDS
WC, OO
5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Texas
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 24,947,500
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
10 SHARED DISPOSITIVE POWER
WITH
24,947,500
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
24,947,500
12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES X
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
40%
14 TYPE OF REPORTING PERSON
HC, CO <PAGE>
13D CUSIP No. 958845109 Page 3 of 8 Pages
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
AGC LIFE INSURANCE COMPANY
IRS #76-0030921
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a)
(b)
3 SEC USE ONLY
4 SOURCE OF FUNDS
WC, OO
5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Missouri
NUMBER OF 7 SOLE VOTING POWER
SHARES 0
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 24,947,500
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 0
PERSON
10 SHARED DISPOSITIVE POWER
WITH
24,947,500
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
24,947,500
12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES X
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
40%
14 TYPE OF REPORTING PERSON
IC <PAGE>
Page 4 of 8 Pages
Item 1. Security and Issuer
This statement relates to the Common Stock of Western National
Corporation ("Western"), located at 5555 San Felipe Road, Suite
900, Houston, Texas 77056.
Item 2. Identity and Background.
(a)-(c) American General Corporation ("American General"), located at 2929
Allen Parkway, Houston, Texas 77019, is a general business
corporation incorporated in the State of Texas on February 26,
1980, and is the successor to American General Insurance Company,
a Texas fire and casualty insurer incorporated in 1926.
AGC Life Insurance Company ("AGC Life"), located at American
General Center, Nashville, Tennessee, 37250, is an insurance
company incorporated in the State of Missouri on September 1,
1982.
A list of the executive officers and directors of American General
is attached hereto as Exhibit 1 in response to Item 2 (a)-(c). A
list of the executive officers and directors of AGC Life is
attached hereto as Exhibit 2 in response to Item 2 (a)-(c).
(d)-(e) Neither American General or AGC Life or, to the best knowledge of
American General or AGC Life, any of the executive officers or
directors of American General or AGC Life have during the last
five years (i) been convicted in a criminal proceeding (excluding
traffic violations or similar misdemeanors) or (ii) been a party
to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or
is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to,
federal or state securities laws or finding any violation with
respect to such laws.
(f) Each of the executive officers and directors of American General
is a citizen of the United States of America, with the exception
of the Senior Vice President and Chief Investment Officer who is a
citizen of Canada.
Each of the executive officers and directors of AGC Life is a
citizen of the United States of America, with the exception of the
Vice President and Chief Investment Officer who is a citizen of
Canada.
Item 3. Source and Amount of Funds or Other Consideration
(1) The acquisition consideration to be paid by AGC Life at the
closing of the proposed acquisition of 24,947,500 shares or 40% of
Western's issued and outstanding common stock is $264,422,500 cash <PAGE>
Page 5 of 8 Pages
(or $11.00 per share). The source of the cash consideration for
AGC Life would be: (i) a $65 million cash contribution from
American General; (ii) $133.5 million of cash dividends to be
received by AGC Life on or after December 15, 1994 from its
subsidiaries American General Life and Accident Insurance Company,
Gulf Life Insurance Company and American General Life Insurance
Company; and (iii) subject to the approval of the Missouri
Department of Insurance, a loan for the remaining $75,922,500 from
American General pursuant to the American General Corporation
Liquidity Program.
(2) The nature (cash) and amount ($11.00 per share or, in the
aggregate, $274,422,500) of the consideration were arrived at
through arms' length negotiations.
Item 4. Purpose of Transaction
American General and AGC Life intend to acquire the common stock
for investment and not with the purpose nor with the effect of
changing or influencing the control of Western, nor in connection
with or as a participant in any transaction having such purpose or
effect. American General and Western executed a Shareholder's
Agreement dated December 2, 1994 (see Item 7., Exhibit 4) which is
a four-year agreement that, among other things, limits American
General's and AGC Life's ability to take certain actions which
could influence control of Western, provides for American General
and AGC Life to either vote its shares in the election of
directors pro rata with the votes cast by other holders, or vote
for the slate of directors nominated by Western's board; limits
the form of share dispositions by American General and AGC Life;
and limits additional purchases of shares by American General and
AGC Life to not more than 20% per year, with a total position
limit of 79%. American General and AGC Life also have been
granted certain registration rights with respect to the common
stock and have the optional right to name two directors to the
Western board.
Item 5. Interest in Securities of the Issuer
(a) American General may be deemed to beneficially own, through its
wholly owned subsidiary, AGC Life, 24,947,500 shares or 40% of
Western's issued and outstanding common stock, upon completion of
the proposed acquisition contemplated by the execution of the
Stock Purchase Agreement dated December 2, 1994 between American
General and Conseco Investment Holding Company (see Item 7.,
Exhibit 3) and the execution of the Shareholder's Agreement dated
December 2, 1994 between American General and Western (see Item
7., Exhibit 4). Pursuant to the Stock Purchase Agreement, such
proposed acquisition may be terminated by either party if the
closing shall not have occurred by January 31, 1995.
<PAGE>
Page 6 of 8 Pages
A poll of the executive officers and directors of American General
and AGC Life indicates that, with the exception of Mr. Robert M.
Devlin (executive officer and director of American General) and
Mr. Brady F. Carruth (director of American General), none of them
owns any of Western's common stock. Mr. Devlin has advised
American General that he beneficially owns directly an aggregate
of 10,000 shares or approximately .0002% of the 62,300,000 issued
and outstanding shares of Western's common. Mr. Carruth has
advised American General that he beneficially owns 1,000 shares or
approximately .00002% of the 62,300,000 issued and outstanding
shares of Western's common stock.
(b) Upon completion of the acquisition, American General and AGC Life
may be deemed to have shared power to vote or to direct the vote
and to dispose or to direct the disposition of the securities
reported herein, subject to the terms of the Shareholder's
Agreement (see Item 7., Exhibit 4). American General and AGC Life
know of no other person who will have the power to vote or to
direct the vote and to dispose or to direct the disposition of the
securities reported herein.
Mr. Devlin and Mr. Carruth have advised American General that they
have the sole power to vote or to direct the vote and to dispose
or to direct the disposition of their respective shares reported
in Item 5(a) above.
(c) Upon completion of the acquisition, American General's wholly
owned subsidiary AGC Life will own 24,947,500 shares of Western's
common stock pursuant to the terms of the Stock Purchase Agreement
dated December 2, 1994.
(d) American General and AGC Life know of no other person who has the
right to receive or the power to direct the receipt of dividends
from, or the proceeds from the sale of, any of the securities
reported herein.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings of Relationships with
Respect to Securities of the Issuer
Stock Purchase Agreement dated December 2, 1994 between American
General Corporation and Conseco Investment Holding Company (see
Item 7., Exhibit 3). See response to Item 4.
Shareholder's Agreement dated December 2, 1994 between Western
National Corporation and American General Corporation (see Item
7., Exhibit 4). See response to Item 4.
<PAGE>
Page 7 of 8 Pages
Item 7. Material to be Filed as Exhibits
Exhibit 1 Executive Officer and Director List for American
General in response to Item 2(a)-(c).
Exhibit 2 Executive Officer and Director List for AGC Life in
response to Item 2 (a)-(c).
Exhibit 3 Stock Purchase Agreement dated December 2, 1994
between American General Corporation and Conseco
Investment Holding Company in response to Item 5(a)
and Item 6.
Exhibit 4 Shareholder's Agreement dated December 2, 1994 between
Western National Corporation and American General
Corporation in response to Item 5(a) and Item 6.
<PAGE>
Page 8 of 8 Pages
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
AMERICAN GENERAL CORPORATION, on behalf of
American General Corporation and its wholly-
owned subsidiary AGC Life Insurance Company
Date: December 12, 1994 BY: /s/ PETER V. TUTERS
Peter V. Tuters
Senior Vice President and
Chief Investment Officer <PAGE>
EXHIBIT 1
DIRECTORS AND EXECUTIVE OFFICERS
OF
AMERICAN GENERAL CORPORATION
The following information is provided with regard to the directors and
executive officers of American General Corporation, a holding company. The
business address for each of the directors and executive officers of American
General is 2929 Allen Parkway, Houston, Texas 77019, unless otherwise
indicated.
Present Principal
Name and Business Address Occupation or Employment
DIRECTORS
J. Evans Attwell Partner, Vinson & Elkins L.L.P.
Vinson & Elkins L.L.P. (attorneys).
2500 First City Tower
1001 Fannin
Houston, Texas 77002-6760
Brady F. Carruth President & Chief Executive Officer,
Gulf Coast Capital Corporation Gulf Coast Capital Corporation.
8633 Antelope Drive
Houston, Texas 77063
W. Lipscomb Davis, Jr. Partner, Hillsboro Enterprises
Hillsboro Enterprises (investments).
201 4th Ave. North, Suite 1390
Nashville, Tennessee 37219
Robert M. Devlin Vice Chairman, American General
Corporation.
Harold S. Hook Chairman and Chief Executive Officer,
American General Corporation.
Larry D. Horner Chairman, Pacific USA Holdings Corp.
Pacific USA Holdings Corp. 110 East 59th Street, Fifth Floor
110 East 59th Street, 5th Floor (investment banking).
New York, New York 10002
Richard J.V. Johnson Chairman and Publisher, The Houston
The Houston Chronicle Chronicle (newspaper publishing).
801 Texas Avenue
Houston, Texas 77002
<PAGE>
Present Principal
Name and Business Address Occupation or Employment
DIRECTORS (continued)
Robert E. Smittcamp President and Chief Executive Officer,
Lyons-Magnus Co., Inc. Lyons-Magnus Co., Inc. (food processor)
1636 South Second Street
Fresno, California 93702
James R. Tuerff President, American General Corporation.
EXECUTIVE OFFICERS
(In addition to those Executive Officers who are also Directors)
Michael G. Atnip Senior Vice President - Special Projects,
American General Corporation.
Jon P. Newton Senior Vice President and General Counsel,
American General Corporation.
Nicholas R. Rasmussen Senior Vice President - Corporate
Development, American General Corporation.
Gary D. Reddick Senior Vice President - Administration,
American General Corporation.
Peter V. Tuters Senior Vice President and Chief Investment
Officer, American General Corporation.
Austin P. Young Senior Vice President and Chief Financial
Officer, American General Corporation.
James L. Gleaves Vice President and Treasurer,
American General Corporation.
Pamela J. Penny Vice President and Controller,
American General Corporation.
John A. Adkins Associate General Counsel and Corporate
Secretary, American General Corporation.
<PAGE>
EXHIBIT 2
DIRECTORS AND EXECUTIVE OFFICERS
OF
AGC LIFE INSURANCE COMPANY
The following information is provided with regard to the directors and
executive officers of AGC Life Insurance Company ("AGC Life"), a life
insurance company. The business address for each of the directors and
executive officers of AGC Life is American General Center, Nashville,
Tennessee 37250, unless otherwise indicated.
Present Principal
Name and Business Address Occupation or Employment
DIRECTORS
James S. D'Agostino, Jr. President and Chief Executive Officer, AGC
Life.
Robert M. Devlin Vice Chairman, American General
American General Corporation Corporation.
2929 Allen Parkway
Houston, Texas 77019
Marcus C. Gibbs Senior Vice President - Customer Service,
AGC Life.
Harold S. Hook Chairman and Chief Executive Officer,
American General Corporation American General Corporation.
2929 Allen Parkway
Houston, Texas 77019
Leo Lebos, Jr. Senior Vice President and Chief Actuary,
AGC Life.
Allen A. McCampbell, Jr. Senior Vice President - Management
Services, AGC Life.
Donald J. Tasser Senior Vice President and Chief Marketing
Officer, AGC Life.
James R. Tuerff President, American General Corporation.
American General Corporation
2929 Allen Parkway
Houston, Texas 77019
Peter V. Tuters Senior Vice President and Chief Investment
American General Corproation Officer, American General Corporation.
2929 Allen Parkway
Houston, Texas 77019
<PAGE>
Present Principal
Name and Business Address Occupation or Employment
EXECUTIVE OFFICERS
(In addition to those Executive Officers who are also Directors)
Kent E. Barrett Senior Vice President, Controller and
Treasurer, AGC Life.
Rex H. Roberts Associate General Counsel and Secretary,
AGC Life.
<PAGE>
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT, dated as of this 2nd day of
December, 1994 (the "Agreement"), by and between American General
Corporation, a Texas corporation ("Buyer"), and Conseco
Investment Holding Company, a Delaware corporation ("Seller").
This Agreement sets forth the terms and conditions upon
which Seller will sell to Buyer and Buyer will purchase from
Seller 24,947,500 shares of common stock, par value $.001 per
share (the "Common Stock"), of Western National Corporation, a
Delaware corporation (the "Company") (such 24,947,500 shares
being referred to herein as the "Shares").
The definitions of certain initially capitalized terms
used herein are set forth in Annex A hereto.
In consideration of the mutual agreements contained
herein, the parties agree as follows:
1. Upon the terms and subject to the conditions of this
Agreement, and in reliance on the representations, warranties and
covenants contained herein, at the Closing described in Section 2
hereof, Seller will sell, assign, transfer and convey to Buyer,
and Buyer will purchase from Seller, all of the Shares. In con-
sideration of the aforesaid sale, Buyer will pay to Seller an
aggregate purchase price of $274,422,500 ($11.00 per Share) in
immediately available funds (the "Purchase Price").
2. The Closing shall be held at the office of Skadden,
Arps, Slate, Meagher & Flom, 919 Third Avenue, New York, New
York, at 10:00 a.m. on the first business day following the date
on which all of the conditions set forth in Sections 8 and 9 to
each party's obligations hereunder have been satisfied or waived;
or at such other place or time or both as the parties mutually
may agree in writing. The date on which the Closing actually
occurs is hereinafter referred to as the "Closing Date."
3. At the Closing, (a) Seller will deliver to Buyer (i)
certificates representing the Shares duly endorsed for transfer
in blank or accompanied by stock powers duly executed in blank,
in proper form for transfer, with all necessary stock transfer
and other documentary stamps affixed and (ii) any other documents
necessary to transfer to the Buyer good and valid title to the
Shares free and clear of all Liens and (b) Buyer will deliver to
Seller the Purchase Price through a wire transfer to a bank
account in a New York bank designated by Seller at least three
business days prior to the Closing.
<PAGE>
4. Seller hereby represents and warrants to Buyer that:
(a) Seller is a corporation duly organized, validly
existing and in good standing under the laws of Delaware and
has all requisite power and authority to own its assets and
to carry on its business as now being conducted and as pres-
ently proposed to be conducted.
(b) Seller has the corporate power and authority to
execute, deliver and perform this Agreement. Such execu-
tion, delivery and performance have been duly authorized by
all necessary action on the part of Seller and will not
contravene the organizational documents of Seller or con-
flict with, result in a breach of, or entitle any party
(with due notice or lapse of time or both) to terminate,
accelerate or call a default with respect to, any agreement
or instrument to which Seller is a party or by which Seller
or its assets are bound. The approval of the shareholders
of the Seller is not required in connection with the execu-
tion, delivery and performance of this Agreement or the
consummation of the transactions contemplated hereby and
thereby. The execution, delivery and performance by Seller
of this Agreement will not result in any violation by such
Seller of any law, rule or regulation applicable to Seller.
Seller is not a party to, nor subject to or bound by, any
judgment, injunction or decree of any Governmental Entity
which may restrict or interfere with the performance of this
Agreement. This Agreement is a valid and binding obligation
of Seller enforceable against Seller in accordance with its
terms.
(c) No consent or waiver of any Governmental Entity is
required for the execution, delivery and performance of this
Agreement other than (i) the filing of this Agreement with
and the approval of such by the Insurance Commissioner of
the State of Texas, and (ii) pursuant to the Hart-Scott-
Rodino Antitrust Improvements Act of 1976 (the "HSR Act").
There are no consents or waiver of any party to any Contract
to which Seller is a party or by which it is bound required
for the execution, delivery and performance by Seller of
this Agreement which has not been obtained.
(d) Seller is the record and beneficial owner of, and
has, and will convey to Buyer at the Closing, good and valid
title to the Shares free and clear of all Liens. Other than
as contemplated by this Agreement, Seller is not a party to,
2
<PAGE>
or bound by, any agreement, instrument, proxy or understand-
ing restricting the transfer of the Shares.
(e) There is no action, suit, investigation or
proceeding pending or, to the knowledge of Seller, threat-
ened against Seller or any of its properties or rights by or
before any Governmental Entity which questions the validity
of this Agreement or any action taken or to be taken
pursuant hereto.
(f) No representation or warranty made to Buyer by
Seller hereunder, and no statement contained in the Filings
based upon written information furnished to the Company by
Seller, or contained in any certificate, document or
instrument delivered by Seller pursuant hereto, contains any
untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements
contained herein or therein, in light of the circumstances
in which they were made, not misleading.
5. Buyer hereby represents and warrants to Seller that:
(a) Buyer is a corporation duly organized, validly
existing and in good standing under the laws of Texas and
has all requisite power and authority to own its assets and
to carry on its business as now being conducted and as pres-
ently proposed to be conducted.
(b) Buyer has the corporate power and authority to
execute, deliver and perform this Agreement. Such execu-
tion, delivery and performance have been duly authorized by
all necessary action on the part of Buyer and will not
contravene the organizational documents of Buyer or conflict
with, result in a breach of, or entitle any party (with due
notice or lapse of time or both) to terminate, accelerate or
call a default with respect to, any agreement or instrument
to which Buyer is a party or by which Buyer or its assets
are bound. The execution, delivery and performance by Buyer
of this Agreement will not result in any violation by Buyer
of any law, rule or regulation applicable to Buyer. Buyer
is not a party to, nor subject to or bound by, any judgment,
injunction or decree of any Governmental Entity which may
restrict or interfere with the performance of this Agree-
ment. This Agreement is a valid and binding obligation of
Buyer enforceable against Buyer in accordance with its
terms.
3
<PAGE>
(c) No consent or waiver of any Governmental Entity is
required for the execution, delivery and performance of this
Agreement other than (i) the filing of this Agreement with
and the approval of such by the Insurance Commissioner of
the State of Texas and (ii) pursuant to the HSR Act. No
consent or waiver of any party to any Contract to which
Buyer is a party or by which it is bound is required for the
execution, delivery and performance by Buyer of this Agree-
ment.
(d) There is no action, suit, investigation or
proceeding pending or, to the knowledge of Buyer, threatened
against Buyer or any of its properties or rights by or
before any Governmental Entity which questions the validity
of this Agreement or any action taken or to be taken
pursuant hereto.
(e) No representation or warranty made to Seller by
Buyer hereunder or in any certificate, documents or instru-
ment delivered by Buyer pursuant hereto, contains any untrue
statement of a material fact or omits to state a material
fact necessary in order to make the statements contained
herein or therein, in light of the circumstances in which
they were made, not misleading.
(f) Buyer will acquire the Shares for its own account
and not with a view to or for sale in connection with any
distribution thereof, and Buyer will not sell or otherwise
dispose of the Shares, except in each case in compliance
with the Securities Act of 1933 and the rules and
regulations thereunder.
6. Seller covenants and agrees with Buyer that, between
the date hereof and the Closing Date:
(a) Seller will perform all acts to be performed by it
pursuant to this Agreement and will refrain from taking or
omitting to take any action that would cause its represen-
tations and warranties to be inaccurate as of the date
hereof or the Closing Date or that in any way would delay or
prevent the consummation of the transactions contemplated
hereby. Seller will use its best efforts to satisfy or
cause to be satisfied all the conditions to the obligations
of Seller and Buyer set forth in Sections 8 and 9 hereof.
(b) Seller will, as promptly as practicable, make any
required governmental filings and comply with any applicable
4
<PAGE>
governmental waiting periods, notification or other proce-
dures required to be taken by it in connection with the
transactions contemplated by this Agreement. In addition,
Seller will use commercially reasonable efforts to make all
filings, furnish all information and obtain such consents as
may be required by any third party or Governmental Entity
properly asserting jurisdiction.
7. Buyer covenants and agrees with Seller that between the
date hereof and the Closing Date:
(a) Buyer will perform all acts to be performed by it
pursuant to this Agreement and will refrain from taking or
omitting to take any action that would cause its represen-
tations and warranties to be inaccurate as of the date
hereof or the Closing Date or that in any way would delay or
prevent the consummation of the transactions contemplated
hereby. Buyer will use its best efforts to satisfy or cause
to be satisfied all the conditions to the obligations of
Seller and Buyer set forth in Sections 8 and 9 hereof.
(b) Buyer will, as promptly as practicable, make any
required governmental filings, including a filing pursuant
to the HSR Act and as required by the Insurance Commissioner
of the State of Texas, and comply with any applicable gov-
ernmental waiting periods or notification or other proce-
dures required to be complied with by it in connection with
the transactions contemplated by this Agreement. In
addition, Buyer will make all filings, furnish all
information and obtain such consents as may be required by
any third party or Governmental Entity properly asserting
jurisdiction.
8. The obligation of Seller to sell the Shares is subject
to the satisfaction or waiver by Seller of the following condi-
tions, on or before the Closing Date:
(a) All representations and warranties of Buyer made
in or pursuant to this Agreement will be true and correct in
all material respects as of the date made and at and as of
the Closing Date, with the same force and effect as though
made at and as of the Closing Date.
(b) Buyer will have performed, observed and complied
in all material respects with all the obligations and condi-
tions required by this Agreement to be performed, observed
or complied with by it at or prior to the Closing Date.
5
<PAGE>
(c) There will be no suit, action or other proceeding
pending or threatened before any Governmental Entity which
Seller believes, in good faith and based upon an opinion of
counsel, could result in the restraint, prohibition, set
aside or invalidation of the consummation of this Agreement
or the transactions contemplated hereby or substantial
damages in connection therewith.
(d) All required governmental filings will have been
made, all applicable waiting periods, including those under
the HSR Act will have run, and all requisite approvals of
Governmental Entities for the consummation of the transac-
tions contemplated hereby will have been granted.
9. The obligation of Buyer to purchase the Shares is
subject to the satisfaction or waiver by Buyer of the following
conditions on or before the Closing Date:
(a) All representations and warranties of Seller made
in or pursuant to this Agreement will be true and correct in
all material respects as of the date made and at and as of
the Closing Date, with the same force and effect as though
made at and as of the Closing Date.
(b) Seller will have performed, observed and complied
in all material respects with all the obligations, agree-
ments and conditions required by this Agreement to be per-
formed or complied with by it at or prior to the Closing
Date.
(c) There will be no suit, action or other proceeding
pending or threatened before any Governmental Entity which
Buyer believes could result in the restraint, prohibition,
set aside or invalidation of the consummation of this Agree-
ment or the transactions contemplated hereby or substantial
damages in connection therewith.
(d) All required governmental filings will have been
made, all applicable waiting periods, including those under
the HSR Act will have run, and all requisite approval of
Governmental Entities, including the final, unappealable ap-
proval of the Insurance Commissioner of the State of Texas,
for the consummation of the transactions contemplated hereby
will have been granted.
(e) Messrs. Rodney D. Moore and Hobart C. Buppert II
shall have resigned as directors of the Company.
6
<PAGE>
10. In the event of any change in the number of shares of
Common Stock outstanding by recapitalization, declaration of a
stock split or combination or payment of a stock dividend or the
like, the number of Shares to be transferred to the Buyer and the
per Share payments to be made to Seller shall be adjusted
appropriately. The Shares shall include all dividends or
distributions in respect of the Shares.
11. Seller and Buyer agree that each of them will consult
with the other before issuing any press release or otherwise
making any public statements with respect to the transactions
contemplated hereby.
12. The parties hereto acknowledge that damages would be an
inadequate remedy for a breach of this Agreement and that the
obligations of the parties hereto shall be specifically
enforceable, in addition to any other remedy which may be
available at law or in equity.
13. Seller and Buyer, in connection with the transactions
contemplated herein, severally agree to indemnify and hold the
other harmless from and against any and all claims, liabilities
or obligations with respect to any brokerage fees, commissions or
finders' fees asserted by any person on the basis of any act or
statement alleged to have been made by such party or its
affiliates.
14. Each party hereto shall pay its own expenses incurred
in connection with this Agreement.
15. All representations, warranties and agreements made by
Seller and by Buyer in this Agreement shall survive the Closing
hereunder and any investigation at any time made by or on behalf
of either party hereto.
16. This Agreement may not be modified, amended, altered or
supplemented except upon the execution and delivery of a written
agreement executed by the parties hereto. Neither party to this
Agreement may assign any of its rights or obligations under this
Agreement without the prior consent of the other party except
that the rights and obligations of Buyer may be assigned by Buyer
to any of its wholly owned subsidiaries but no such transfer
shall relieve Buyer of its obligations hereunder if such
transferee does not perform such obligations.
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17. All notices, claims, requests, demands, and other
communications hereunder will be in writing and will be deemed to
have been duly given upon receipt as follows:
(a) If to Buyer, to:
Robert M. Devlin
Vice Chairman
American General Corporation
2929 Allen Parkway
Houston, Texas 77019
Telephone: (713) 522-1111
Fax: (713) 831-1300
with copies to:
Jon P. Newton
Senior Vice President and General Counsel
American General Corporation
2929 Allen Parkway
Houston, Texas 77019
Telephone: (713) 522-1111
Fax: (713) 831-1266
and
Morris J. Kramer
Skadden, Arps, Slate, Meagher & Flom
919 Third Avenue
New York, New York 10022
Telephone: (212) 735-3000
Fax: (212) 735-2000
(b) If to Seller, to
Conseco Investment Holding Company
1209 Orange Street
Wilmington, DE 19801
Attn: Mark A. Ferrucci
with a copy to:
Lawrence W. Inlow
Conseco, Inc.
11825 N. Pennsylvania Street
Carmel, IN 46032
or to such other address as the person to whom notice is to be
given may have previously furnished to the other in writing in
the manner set forth above.
8
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18. This Agreement may be executed in two or more
counterparts, each of which will be deemed to be an original but
all of which together will constitute one and the same
instrument.
19. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, regardless of
the laws that might otherwise govern under principles of
conflicts of law.
20. This Agreement may be terminated at any time prior to
the Closing Date (i) by mutual consent of Buyer and Seller; or
(ii) by Buyer or Seller if, without fault of, and other than by
reason of a matter within the control of, the terminating party,
the Closing shall not have occurred on or prior to January 31,
1995. In the event of any termination permitted by the preceding
sentence, neither party hereto will have liability pursuant to
this Agreement, except for liabilities arising under Sections 13
and 14 and except for liabilities resulting from willful breach.
21. Any waiver by any party of a breach of any provision of
this Agreement shall not operate as or be construed to be a
waiver of any other breach of such provision or of any breach of
any other provision of this Agreement. The failure of a party to
insist upon strict adherence to any term of this Agreement shall
not be considered a waiver or deprive that party of the right
thereafter to insist upon strict adherence to that term or any
other term of this Agreement.
22. This Agreement constitutes the entire agreement and
supersedes all prior agreements and understandings, whether oral
or written, between the parties hereto with respect to the
subject matter hereof.
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IN WITNESS WHEREOF, this Agreement has been duly
executed and delivered by duly authorized officers of Buyer and
Seller as of the day and year first written above.
AMERICAN GENERAL CORPORATION
By:/s/ Harold S. Hook
Name: Harold S. Hook
Title: Chairman and CEO
CONSECO INVESTMENT HOLDING COMPANY
By:/s/ William T. Devanney, Jr.
Name: William T. Devanney, Jr.
Title: Vice President
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<PAGE>
GUARANTY
CONSECO, INC., an Indiana corporation and the holder of
all of the outstanding capital stock of Conseco Investment
Holding Company ("CIHC"), hereby unconditionally guarantees the
performance of all of CIHC's obligations pursuant to the
foregoing agreement.
CONSECO, INC.
By:/s/ Stephen C. Hilbert
Name: Stephen C. Hilbert
Title: Chairman of the Board
December 2, 1994
11
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ANNEX A
Definitions
"Contracts" means all agreements or
understandings, whether written or oral, including, without limi-
tation, all mortgages, indentures, notes, guarantees, leases,
purchase agreements and sale agreements.
"Filings" means all registration
statements under the Securities Act of 1933 and all reports,
proxy statements and other information under the Securities
Exchange Act of 1934, as amended, filed by the Company with the
Securities Exchange Commission.
"Governmental Entity" means any agency,
administrative division or department (or administrative
subdivision), arbitrator, commission, regulatory authority,
taxing or administrative authority, court or other judicial body,
legislature, audit group or procuring office of the government of
the United States or of any state, city, municipality, county or
town thereof, or of any foreign jurisdiction, including the
employees or agents of any thereof.
"Liens" means all mortgages, pledges,
security interests, liens, charges, options, conditional sales
agreements, claims, restrictions, covenants, easements, rights of
way, title defects or other encumbrances of any nature whatso-
ever.
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EXHIBIT 4
SHAREHOLDER'S AGREEMENT
This Agreement (the "Shareholder's Agreement"), entered into on this 2nd
day of December, 1994, by and among Western National Corporation (the
"Company"), a Delaware corporation, and American General Corporation
("Stockholder"), a Texas corporation,
W I T N E S S E T H:
WHEREAS, Stockholder will on the date hereof enter into an agreement
with Conseco Investment Holding Company ("Conseco") to acquire 24,947,500
shares of Common Stock, par value $.001 per share (the "Common Stock") of the
Company, representing approximately 40% of the outstanding Common Stock (such
24,947,500 shares, together with any other shares of voting stock of the
Company that may be acquired by Stockholder during the term of this
Shareholder's Agreement, hereinafter referred to as the "Shares"); and
WHEREAS, Company and Stockholder wish to establish certain rights and
obligations of each to the other with respect to the Shares and their
ownership by Stockholder;
NOW, THEREFORE, the parties hereto hereby agree as follows:
ARTICLE I
AGREEMENTS RESPECTING THE SHARES
Section 1.1 Sale of Shares.
(a) Stockholder hereby agrees that, until the earlier of
(i) January 1, 1999 or (ii) the date on which Michael J. Poulos ceases, as a
result of death, disability, or resignation, to serve as Chief Executive
Officer of the Company (such date being herein referred to in either event as
the "Termination Date"), it will not, dispose of, or enter into an agreement
providing for the disposal of, all or any portion of the Shares without the
prior approval of the Company's Board of Directors (which approval will not be
unreasonably withheld).
(b) Notwithstanding the limitation in Section 1.1(a) hereof, nothing
herein shall prevent Stockholder from selling all or any portion of the Shares
(i) in a public offering intended to result in widespread distribution;
(ii) in a transaction under Rule 144 under the Securities Act of 1933 (the
"Securities Act") in accordance with the volume limitations set forth therein;
(iii) in privately negotiated block trades; provided that the purchaser,
together with its "affiliates" (as such term is used in Rule 12b-2 under the
Securities Exchange Act of 1934 (the "Exchange Act")) and any members of any
"group" (within the meaning of Section 13(d)(3) of the Exchange Act), does
not, after giving effect to such transaction, own "beneficially" (within the
meaning of the Exchange Act) more than 4.9% of the outstanding Common Stock;
(iv) by Stockholder to an entity that is a direct or indirect majority
controlled subsidiary of Stockholder if, but only if, either (x) the Shares
to <PAGE>
be held by such subsidiary do not constitute a substantial part of such
subsidiary's assets, and such subsidiary enters into a shareholders agreement
with the Company on terms substantially consistent with this Shareholder's
Agreement, or (y) Stockholder and such entity agree, for the benefit of the
Company, that if such entity ceases to be an entity that is a direct or
indirect majority controlled subsidiary of Stockholder, then such entity shall
immediately transfer all shares of Common Stock owned by such entity to
Stockholder or another entity that is then a direct or indirect majority
controlled subsidiary of Stockholder; or (v) pursuant to a tender offer or
exchange offer by the Company, a tender offer or exchange offer by a third
party which has been approved by the Board of Directors of the Company or a
merger or other business combination involving the Company which, in each
case, is not solicited by the Stockholder and in which the Stockholder is
treated on substantially comparable terms with other holders of the Common
Stock; and (vi) subject to the Company's right of first refusal as set forth
in Section 1.10, in response to, and pursuant to the terms of, any tender
offer or exchange offer by a third party (other than an offer referred to in
clause (v) of this Section 1.1(b)).
Section 1.2 Certain Rights and Limitations.
(a) The Stockholder agrees that, until the Termination Date, whether
or not the Stockholder shall continue to own any voting securities of the
Company, the Stockholder shall not, and shall cause each of its "affiliates"
(as such term is used in Rule 12b-2 under the Exchange Act) not to, unless and
until such shall have been specifically invited in writing by the Company,
directly or indirectly (i) except as permitted by Section 1.2(b) below,
acquire or make any proposal to acquire any voting securities of the Company
or any securities that are exercisable, exchangeable, or convertible into
voting securities of the Company or seek or propose any merger, consolidation,
business combination, tender or exchange offer, sale or purchase of assets or
securities, dissolution, liquidation, restructuring, recapitalization or
similar transaction of or involving the Company or any of its subsidiaries,
(ii) make, or in any way participate in, any "solicitation" of "proxies" (as
such terms are used in the proxy rules of the Securities and Exchange
Commission) or consents to vote or seek to advise or influence any person with
respect to the voting of any securities of the Company, (iii) form, join or in
any way participate in a "group" (within the meaning of Section 13(d)(3) of
the Exchange Act) with respect to any voting securities of the Company,
(iv) otherwise act, alone or in concert with others, to seek to control or
influence the management, Board of Directors or policies of the Company,
(v) initiate or propose to the Company a shareholder proposal within the
meaning of Rule 14a-8 under the Exchange Act, (vi) have any discussions or
enter into any arrangements, understandings or agreements (whether written or
oral) with, or advise, assist or encourage, any other persons in connection
with any of the foregoing, or make any equity investment in any other person
that engages in, or offers or proposes to engage in, any of the foregoing (it
being understood that, without limiting the generality of the foregoing, the
Stockholder shall not be permitted to act as a joint bidder or co-bidder with
any other person with respect to the Company or any of its subsidiaries);
(vii) make any publicly disclosed proposal regarding any of the foregoing; or
<PAGE>
(viii) call a shareholders meeting pursuant to the bylaw provision
contemplated by Section 1.9(b) hereof. The Stockholder also agrees during
such period not to make any proposal, statement or inquiry or disclose any
intention, plan or arrangement, whether written or oral, inconsistent with the
foregoing, or request the Company, directly or indirectly, to amend, waive or
terminate any provision of this paragraph (including this sentence).
(b) Notwithstanding Section 1.2(a), Stockholder may (i) acquire
securities by way of stock dividends or other distributions payable to holders
of Common Stock of the Company generally; and (ii) acquire in any one twelve-
month period a number of shares not in excess of 20% of the total number of
shares of Common Stock outstanding as of the date such determination is made;
provided, however, that prior to the Termination Date, Stockholder and its
affiliates shall not in any event own "beneficially" (with the meaning of the
Exchange Act) in excess of 79% of the total number of shares of Common Stock
outstanding as of the date of any such determination.
Section 1.3 Voting of Shares.
(a) The Stockholder hereby agrees that, until the Termination Date, at
any meeting of the stockholders of the Company, however called, and in any
action by consent of the stockholders of the Company, the Stockholder shall
vote the Shares and any other voting securities of the Company with respect to
the election of directors, at Stockholder's option, either (i) in the same
proportion as the votes cast by the holders of all other voting securities of
the Company, other than any votes cast by an Affiliated Holder or (ii) in
favor of the slate of directors proposed by the Board of Directors of the
Company; provided, however, that the Stockholder shall be permitted to vote
the Shares, in its discretion, for the election as directors of individuals
nominated by it in accordance with the terms of Article III hereof. For
purposes of this Section 1.3(a), the term "Affiliated Holder" means any
"person" or "group" (as such terms are defined for purposes of the provisions
of Section 13(d) of the Exchange Act) that, together with its affiliates, is
the beneficial owner, as determined pursuant to Rule 13d-3 under the Exchange
Act, of securities representing 10% or more of the total voting power of all
voting securities of the Company, exclusive of the Shares, outstanding and
entitled to vote at the record date for any vote or consent with respect to
which such determination is made.
(b) The Stockholder hereby covenants and agrees that, except as
contemplated by this Agreement, the Stockholder shall not enter into any
voting agreement or grant a proxy or power of attorney with respect to the
Shares that is inconsistent with this Agreement.
Section 1.4 Binding on Affiliates, etc. Stockholder agrees that the
limitations applicable to Stockholder hereunder shall be equally applicable to
each person or entity controlled by Stockholder, to the same extent as if each
such person or entity were named as Stockholder hereunder.
Section 1.5 Filing of Form 13D. Stockholder agrees that it will file an
initial 13D representing that the acquisition of the Shares is for "investment
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purposes" and not for the purpose of acquiring or influencing control of the
Company.
Section 1.6 Resolution under Section 203. The Company hereby represents
and warrants that its Board of Directors has duly adopted the resolution
attached hereto as Exhibit A prior to entering into this Agreement.
Section 1.7 Shareholder's Rights Plan. The Company agrees that so long
as Stockholder (together with its majority owned subsidiaries) does not,
through the sale or other disposition of its Shares, reduce its beneficial
ownership of the Company's Common Stock below 40% (a "Disqualifying
Disposition"), the Company will not adopt a shareholder's rights plan that
would limit or adversely affect the rights of Stockholder. Notwithstanding
termination of this Agreement by the occurrence of the Termination Date or
otherwise, the provisions of this Section shall survive and continue in effect
unless and until a Disqualifying Disposition occurs, unless this Agreement is
terminated pursuant to an instrument in writing expressly terminating this
Section.
Section 1.8 Legend. Stockholder agrees that (i) it is acquiring the
Shares for investment purposes for its own account, and will not effect a
distribution thereof in violation of the registration provisions of the
Securities Act; and (ii) that the Shares will bear the following legend:
"The shares represented by this certificate (the "Shares") have
not been registered under the Securities Act of 1933, and no sale,
transfer or other disposition may be made of the Shares unless
they have been so registered or Western National Corporation has
been furnished evidence satisfactory to it that such registration
is not required. The Shares are also subject to certain
restrictions on transfer contained in a Shareholder's Agreement to
which Western National Corporation and the registered holder are
parties, a copy of which is on file with the Secretary of Western
National Corporation."
Section 1.9 Amendment to Articles and Bylaws.
(a) The Company agrees to submit to its shareholders for consideration
at its 1995 Annual Meeting, and to recommend the adoption of, an amendment
(the "Amendment") eliminating the classification of its board of directors as
provided in Article Ninth of its Certificate of Incorporation. Each current
director whose term extends beyond the 1995 Annual Meeting, by his approval of
this Agreement at a meeting held for such purpose, hereby agrees, subject to
the approval of the Amendment by the shareholders of the Company, to take such
action as may be necessary to limit his current term to the 1996 Annual
Meeting and until his successor is elected and qualified.
(b) The Company agrees to amend its Bylaws to permit any holder of 35%
or more of the outstanding Common Stock of the Company to call a special
meeting of shareholders of the Company for the purpose of removing and/or
electing directors, and not to delete or limit such bylaw at any time prior to
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the occurrence of a Disqualifying Disposition as defined in Section 1.7
hereof. Notwithstanding the termination of this Agreement by the occurrence
of the Termination Date or otherwise, the provisions of this Section shall
survive and continue in effect unless and until a Disqualifying Disposition
occurs, unless this Agreement is terminated pursuant to an instrument in
writing expressly terminating this Section.
Section 1.10 Right of First Refusal
(a) Prior to making any sale or exchange of Shares pursuant to
Section 1.1(b)(vi) in response to a tender offer or exchange offer (an
"Offer"), the Stockholder shall give the Company the opportunity to purchase
such Shares in the following manner:
(i) The Stockholder shall give notice (the "Tender Notice") to
the Company in writing of its intention to sell or exchange Shares in
response to an Offer no later than four calendar days prior to the
latest time (including any extensions) by which Shares must be tendered
in order to be accepted pursuant to such Offer, specifying the number of
Shares proposed to be tendered by the Stockholder and the purchase price
per Share specified in the Offer at the time of the Tender Notice.
(ii) If the Tender Notice is given, the Company shall have the
right, exercisable by giving notice to the Stockholder at least two
calendar days prior to the latest time after delivery of the Tender
Notice by which Shares must be tendered in order to be accepted pursuant
to the Offer (including any extensions thereof), to purchase all, but
not part, of the Shares specified in the Tender Notice (an "Exercise
Notice"). The purchase price to be paid by the Company for any Shares
purchased by it pursuant to this Section 1.10 shall be the final price
per Share specified in the Offer on the Last Tender Date (as defined
below). If the purchase price per Share specified in the Offer includes
any property other than cash (the "Offer Noncash Property"), the
purchase price at which the Company shall be entitled to purchase all,
but not part, of the Shares specified in the Tender Notice shall be (u)
the amount of cash per Share specified in such Offer (the "Cash
Portion"), plus (v) an amount of cash per Share equal to the value of
the Offer Noncash Property per Share (the "Cash Value of Offer Noncash
Property"). If the Company exercises its right of first refusal by
giving an Exercise Notice, the closing of the purchase of the Shares
with respect to which such right has been exercised (the "Closing")
shall take place at 3:00 p.m., New York City time (or, if earlier, two
hours before the latest time by which shares must be tendered in order
to be accepted pursuant to the Offer), on the last day on which shares
must be tendered in order to be accepted pursuant to the Offer
(including any extensions thereof) (the "Last Tender Date"), and the
Company shall pay the purchase price for the Shares specified above as
follows: (w) the payment of the Cash Portion shall occur at the Closing
on the Last Tender Date, and (x) the payment of the Cash Value of Offer
Noncash Property (if any) shall occur promptly after the determination
of the value of the Offer Noncash Property (if any) but in no event
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<PAGE>
later than 20 calendar days after the delivery of the Tender Notice (or,
if later, at the Closing). The value of any Offer Noncash Property
shall be determined by a nationally recognized investment banking firm
selected jointly by the Company and the Stockholder or, in the event the
Company and the Stockholder are unable to agree on the selection of such
investment banking firm, by a nationally recognized investment banking
firm to be selected jointly, as promptly as reasonably practicable, by a
nationally recognized investment banking firm selected by the Company
and a nationally recognized investment banking firm selected by the
Stockholder.
(b) The Stockholder shall be entitled to rescind its Tender Notice at
any time prior to the Last Tender Date by notice in writing to the Company.
If the Stockholder rescinds its Tender Notice pursuant to the immediately
preceding sentence, the Company's Exercise Notice with respect to such offer
shall be deemed to be immediately rescinded.
(c) If the Company does not exercise its right of first refusal set
forth in this Section 1.10 within the time specified for such exercise by
giving an Exercise Notice, then the Stockholder shall be free to accept for
all its Shares the Offer with respect to which the Tender Notice was given.
ARTICLE II
SECURITIES ACT REGISTRATION
Section 2.1 Demand Registration.
(a) Stockholder may require the Company to register Shares proposed to
be sold by it and/or any Holder under the Securities Act. Such a registration
must relate to Shares with an aggregate fair market value of at least
$50 million on the date of the Demand or, if less, all of the Shares owned by
all Holders controlled by Stockholder. Each registration of shares pursuant
to this Section 2.1 (a "Demand Registration") shall be for a firm commitment
underwritten public offering through underwriter(s) managed by a manager (the
"Manager") selected by Stockholder, provided such manager is reasonably
acceptable to the Company (an "Underwriting"). The Company may select one
additional underwriter to serve as co-managing underwriter (but not lead
underwriter), provided that such underwriter is reasonably acceptable to
Stockholder.
(b) As used in this Article II: "Seller" means a Holder selling or
proposing to sell Shares pursuant to any registration statement contemplated
by this Section; "Registration Statement" means a registration statement under
the Securities Act; "Prospectus" means a prospectus included in a registration
statement or relating to an offer and sale of Shares registered under the
Securities Act; and "Holder" means Stockholder, any subsidiary of Stockholder
and any other person acquiring Shares on or after the date hereof and becoming
a party to this Shareholder's Agreement in accordance with this Shareholder's
Agreement.
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<PAGE>
(c) The right to require a Demand Registration under subsection (a)
may be exercised by giving notice (a "Demand") to the Company stating the
number of shares proposed to be sold therein. The Company shall not be
required to effect more than one Demand Registration in any six-month period
nor more than an aggregate of six Demand Registrations pursuant to this
Article II.
(d) Stockholder's right to a Demand Registration shall be deemed to
have been satisfied upon (i) payment and delivery of the Shares to be sold in
the related Underwriting, (ii) the failure of such a closing to occur due to a
default by Stockholder or (iii) the withdrawal of the Demand Registration at
the request of Stockholder after the related registration statement has been
filed with the Securities and Exchange Commission, in accordance with
Section 2.3, unless such withdrawal is made because the Manager of the
Underwriting advises the Company that the Underwriting cannot be successfully
completed because of market conditions or adverse factors relating to the
business, affairs or financial condition of the Company.
Section 2.2 Term. Notwithstanding the termination of this Agreement due
to the occurrence of the Termination Date or otherwise, the registration
rights provided for in this Agreement shall survive and continue until the
earliest to occur of (i) January 1, 2000; (ii) the date on which all remaining
Shares are freely saleable without registration; or (iii) the date on which
all Shares have been sold or otherwise disposed of by Stockholder, unless this
Agreement is terminated pursuant to any instrument in writing expressly
terminating this Section.
Section 2.3 Registration Procedure.
(a) The registration statement for each Demand Registration will
include the Shares specified in the related Demand and notice given pursuant
to subsection 2.1(c) and will be reasonably satisfactory to counsel for the
Stockholder and counsel for the Manager (which term includes, where
appropriate, counsel for the underwriters in the Underwriting). The
registration statement will be filed under the Securities Act within 60 days
after receipt of the Demand therefor, but the Company may postpone such filing
for a period not exceeding an additional 45 days, by giving notice of such
delay to the Stockholder and the Manager, if the Company's Board of Directors
determines in good faith that such filing would interfere with a pending
material acquisition, disposition, or financing of the Company; provided, that
the Company may not exercise this right to delay such filing more than once in
any twelve month period.
(b) With respect to each Demand Registration, the Company will: (i)
use its reasonable best efforts to cause the registration statement to become
effective under the Securities Act at the earliest possible date; (ii) amend
the registration statement or supplement the prospectus whenever required by
the terms of the underwriting agreement contemplated by Section 2.4; (iii)
furnish such number of copies of the registration statement, prospectuses,
preliminary prospectuses and amendments or supplements thereto as the Manager
may reasonably request; (iv) make generally available to its security holders
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<PAGE>
an earnings statement satisfying the requirements of Section 10(a) of the
Securities Act as promptly as practicable after the expiration of 12 months
after the effective date of the registration statement; and (v) use its
reasonable best efforts to register or qualify the Shares being registered in
a Demand Registration under the securities or blue sky laws of such
jurisdictions as the Manager may reasonably request and maintain such
registrations or qualifications in effect for the period specified in the
underwriting agreement contemplated by Section 2.4.
(c) A Demand Registration may be withdrawn, subject to any required
Securities and Exchange Commission approval and the related Underwriting
terminated, at any time by the Stockholder, subject to the terms of
Section 2.7.
Section 2.4 Underwriting Arrangements.
(a) In connection with each Demand Registration, the Company and the
Seller will enter into and perform their respective obligations under an
underwriting agreement with the Manager (whether acting alone or for a
syndicate of underwriters) containing representations, warranties, conditions,
covenants and indemnities customarily included in such agreements, used by so-
called "major bracket" underwriters for public offerings of common stock on
the registration form being used in such registration. The public offering
price and underwriting discounts or commissions in an Underwriting will be
determined by agreement between the Holders and the Manager.
(b) The Company will cooperate with the Holders, the Manager, counsel
for the Manager and counsel for the Holders in their investigation of the
Company, the preparation of the registration statement and the marketing of
the Shares being sold in the Underwriting, including making available the
Company's officers, accountants, counsel, premises, books and records for such
purpose. Each Holder participating in an Underwriting will furnish to the
Company and the Manager such written information, powers of attorney and other
documents as the Company, the Manager or their respective counsel may
reasonably request in order to complete the Underwriting.
Section 2.5 Holdback Agreements. At the request of the Manager in an
Underwriting, the Company and each Holder will agree not to offer or sell any
Common Stock (including Shares) for cash during the period beginning seven
days prior to the effective date of the registration statement for such
Underwriting and ending 90 days after such effective date except:
(i) pursuant to such Underwriting, (ii) with the consent of the Manager, or
(iii) in the case of the Company, pursuant to a stock purchase, option or
other employee benefit plan for employees and agents of the Company or any
subsidiary thereof ("Benefit Plans"), outstanding warrants, options or rights
(including the conversion rights of convertible securities), or any dividend
reinvestment or similar plan.
Section 2.6 Piggyback Rights. If at any time on or before the
Termination Date, the Company proposes to file a registration statement under
the Act for a public offering of Common Stock for cash (other than in
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<PAGE>
connection with any sales referred to in clause (iii) of Section 2.5), it will
give each Holder notice thereof and will include in such registration and any
related underwritten public offering any Shares proposed to be sold by any
Holder requesting such inclusion by notice given to the Company within ten
days after the Company has given notice of such proposed registration. If
such registration is an underwritten public offering and the managing
underwriter thereof advises the Company that the offering would include more
Common Stock than can be sold within a price range acceptable to the Company
or other person on whose behalf the offering is being made, the amount to be
sold therein by the Holders shall be reduced to the amount which in the
opinion of such managing underwriter can be sold within such price range.
Section 2.7 Expenses. The Company will bear all of its expenses of any
piggyback registration contemplated by Section 2.6, except that each selling
Holder shall pay its share of any underwriting discount or commission. With
respect to the first three Demand Registrations, the Company shall pay, and,
with respect to any Demand Registration thereafter, the Holders shall pay, all
of the expenses of each Demand Registration including: (i) the costs of
printing and shipping the prospectuses, supplements, underwriting agreements,
blue sky surveys and stock certificates; (ii) the fees and expenses of the
Company's counsel, accountants and transfer agents; (iii) the reasonable fees
and expenses of the Manager's counsel for the blue sky qualification and
survey; and (iv) all filing fees payable with respect to the Shares to be sold
under the Securities Act, any blue sky laws, and to the National Association
of Securities Dealers, Inc.; provided, however, that (x) each Holder shall in
any event pay its share of any underwriting discount or commission, and
(y) each Holder shall reimburse the Company for its pro rata share of the
Company's costs and expenses of any Demand Registration withdrawn as described
in subsection 2.1(d)(iii), unless such withdrawal is due to adverse factors
relating to the business, affairs, or financial condition of the Company as
described in subsection 2.1(d)(iii).
Section 2.8 Indemnification.
(a) The Company shall indemnify and hold harmless each Seller, each
director, officer and partner of such Seller, and each other person, if any,
who controls such Seller within the meaning of the Securities Act
(collectively, including the Seller, such Seller's "Seller Indemnified
Parties"), from and against any and all losses, claims, damages or
liabilities, joint or several, and expenses (including, subject to subsection
(c) hereof, fees of counsel and any amounts paid in any settlement effected
with the consent of the Company) to which any such Seller Indemnified Party
may become subject under the Securities Act, common law or otherwise, insofar
as such losses, claims, damages or liabilities (or actions or proceedings,
whether commenced or threatened, in respect thereof) or expense arises out of
or are based upon (i) any untrue statement or alleged untrue statement of any
material fact contained in any registration statement or any preliminary or
final prospectus contained therein or relating to an offer and sale of Shares
registered under the Securities Act, or any amendment or supplement thereto,
or (ii) any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
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misleading, and the Company agrees to reimburse such Seller Indemnified Party
for any legal or any other expenses reasonably incurred by it in connection
with investigating or defending any such loss, claim, liability, action or
proceeding; provided, that the Company shall not be liable to any such person
to the extent that any such loss, claim, damage, liability (or action or
proceeding, whether commenced or threatened, in respect thereof) or expenses
arise out of or are based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in such registration statement, or
preliminary or final prospectus, or amendment or supplement in reliance upon
and in conformity with written information furnished to the Company by such
person expressly for use therein.
(b) Each Seller shall indemnify and hold harmless the Company, each
director and officer of the Company and each other person, if any, who
controls the Company within the meaning of the Securities Act (collectively,
including the Company, the "Company Indemnified Parties"), from and against
any and all losses, claims, damages or liabilities, joint or several, and
expenses (including, subject to Subsection (c) hereof, fees of counsel and any
amounts paid in settlement effected with the consent of such Seller) to which
any such person may become subject under the Securities Act, common law or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
or proceedings, whether commenced or threatened, in respect thereof) or
expenses arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact or omission or alleged omission to state a
material fact required to be stated in any registration statement or any
preliminary or final prospectus contained therein or relating to an offer and
sale of Shares registered under the Securities Act, or any amendment or
supplement thereto, or necessary to make the statements therein not
misleading, to the extent, but only to the extent, that such statement or
alleged statement or omission or alleged omission was made in reliance upon
and in conformity with written information furnished to the Company by such
Seller expressly for use therein.
(c) Promptly after receipt by a Seller Indemnified Party or a Company
Indemnified Party (each an "Indemnified Party") of written notice of the
commencement of any action or proceeding with respect to which a claim for
indemnification may be made pursuant to the indemnification provisions
contemplated by this Section 2.8, such Indemnified Party shall, if a claim in
respect thereof is to be made against an indemnifying party, give written
notice to such indemnifying party of the commencement of such action;
provided, that the failure of any Indemnified Party to give notice as provided
herein shall not relieve the indemnifying party of any obligations it may have
under this Section 2.8 except to the extent that the indemnifying party has
been prejudiced in any material respect by such failure. In case any such
action is brought against an Indemnified Party, the indemnifying party shall
be entitled to participate therein and to assume the defense thereof, jointly
with any other indemnifying party similarly notified, to the extent that it
may wish, with counsel reasonably satisfactory to such Indemnified Party, and
after such notice from the indemnifying party to such Indemnified Party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such Indemnified Party for any legal or other expenses subsequently
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incurred by the latter in connection with the defense thereof other than
reasonable costs of investigation unless (i) the indemnifying party has failed
to assume the defense of such claim and to employ counsel reasonably
satisfactory to such Indemnified Party or (ii) such Indemnified Party shall
have reasonably concluded that there may be defenses available to it which are
different from or additional to those available to the indemnifying party (in
which case the indemnifying party shall not have the right to assume the
defense of such action on behalf of the Indemnified Party), in any of which
events the fees and expenses of counsel for the Indemnified Party shall be
borne by the indemnifying party. An indemnifying party who does not assume
the defense of a claim shall not be liable for the fees and expenses of more
than one counsel in any single jurisdiction for all Indemnified Parties who
have available to them the same defenses with respect to such claim, or with
respect to claims separate but similar or related in the same jurisdiction
arising out of the same general allegations. No indemnifying party shall
consent to entry of any judgment or enter into any settlement with respect to
a claim without the consent of the Indemnified Party, which consent shall not
be unreasonably withheld, or unless such judgment or settlement includes as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect of such claim.
No Indemnified Party shall consent to entry of any judgment or enter into any
settlement of any such action the defense of which has been assumed by an
indemnifying party without the consent of such indemnifying party, which
consent shall not be unreasonably withheld.
(d) If for any reason the indemnification provisions contemplated by
Subsection (a) or (b) are unavailable to or insufficient to hold harmless an
Indemnified Party in respect of any losses, claims, damages or liabilities
referred to therein, then the indemnifying party shall contribute to the
amount paid or payable by the Indemnified Party as a result of such losses,
claims, damages, liabilities or expenses in such proportion as is appropriate
to reflect the relative fault of the indemnifying party and the Indemnified
Party as well as any other relevant equitable considerations. The relative
fault of such indemnifying party and Indemnified Party shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by such indemnifying party or
Indemnified Party, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
For purposes of determining relative fault, the intent, knowledge, access to
information and opportunity to correct or prevent a statement or omission (x)
of the Company shall also be attributable to the Company Indemnified Parties
and (y) of a Seller shall be attributable to its Seller Indemnified Parties.
The amount paid or payable by a party as a result of the losses, claims,
damages, liabilities and expenses referred to above shall be deemed to
include, subject to the limitations set forth in subsection (c) hereof, any
legal or other fees or expenses reasonably incurred by such party. The
parties hereto agree that it would not be just and equitable if contribution
pursuant to this subsection (d) were determined by pro rata allocation (even
if the Sellers were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable
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considerations referred to in the immediately preceding paragraph. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. Notwithstanding the
provisions of this subsection (d), no Seller in such capacity shall be
required to contribute any amount in excess of the total proceeds received by
it from the sale of Shares pursuant hereto.
(e) The indemnification and contribution provisions contained in this
Section 2.8 shall (i) with respect to any Seller Indemnified Party, survive
the transfer of Shares by its Seller and with respect to all Indemnified
Parties shall survive the termination of rights under this Section 2.8,
(ii) be in addition to any rights or obligations under any underwriting
agreement entered into pursuant to Section 2.4 and (iii) remain in full force
and effect regardless of any investigation made by or on behalf of any
Indemnified Party.
Section 2.9 Certain Limitations on Registration Rights. Notwithstanding
the other provisions of this Article II, the Company shall not be obligated to
register Shares of any Holder if, in the opinion of counsel to the Company
reasonably satisfactory to Stockholder and its counsel, the sale or other
disposition of such Holder's shares, in the manner proposed by such Holder,
may be effected without registering such Shares under the Securities Act.
ARTICLE III
DESIGNATION OF DIRECTORS
Section 3.1 Appointment of Directors. Effective as of the closing of
the acquisition of the Shares by Stockholder from Conseco, the Company agrees,
if so requested by Stockholder, to appoint as directors (the "Stockholder
Directors") two individuals specified by Stockholder to fill vacancies created
by the resignation as directors of the two individuals previously designated
by Conseco (the "Conseco Directors"), provided that the Conseco Directors
shall have theretofore resigned their positions as directors of the Company;
and provided further that the individuals specified by Stockholder shall be
reasonably acceptable to the Company and shall not include any individual that
is an officer, director, or employee of Stockholder or its majority controlled
subsidiaries (an "Ineligible Person").
Section 3.2 Nomination of Successors. So long as Stockholder shall
continue to own beneficially at least 25% of the Company's outstanding shares
of Common Stock, Stockholder shall have the right to designate nominees
selected and proposed from time to time by the Board of Directors for election
to the Board by the stockholders as successors to the Stockholder Directors;
provided that the individuals designated by Stockholder shall be reasonably
acceptable to the Company and shall not include an Ineligible Person. If the
beneficial ownership of the Company's outstanding shares of Common Stock by
Stockholder falls below 25%, but remains at least 20% or more, Stockholder
shall have the right to designate one nominee selected and proposed from time
to time by the Board for election to the Board by the stockholders as
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successor to one of the Stockholder Directors but only to the extent necessary
such that Stockholder will continue to have one designee serving on the Board
of Directors; provided that the individual designated by Stockholder shall be
reasonably acceptable to the Company and shall not include an Ineligible
Person. The Company shall use its best efforts to cause any nominee
designated by Stockholder pursuant hereto to be elected by the stockholders
including, without limitation, supporting the election of Stockholder
designees in any proxy material prepared and circulated by the Company in
connection with the election of directors. Notwithstanding the foregoing, the
provisions of this Section 3.2 shall terminate on the Termination Date.
ARTICLE IV
MISCELLANEOUS
Section 4.1 Interpretation. This Shareholder's Agreement shall be
interpreted in accordance with the law of the State of Texas applicable to
agreements made and performed therein.
Section 4.2 Headings. Headings are solely for the convenience of the
parties and shall not affect the interpretation of any provision of this
agreement.
Section 4.3 Sole Agreement. This Shareholder's Agreement constitutes
the entire agreement and supersedes all prior agreements, whether written or
oral, with respect to the subject matter hereof; provided,however, that unless
and until Stockholder acquires the Shares, the Confidentiality Agreement,
dated as of November 18, 1994, between Stockholder and Company shall remain in
full force and effect.
Section 4.4 Amendments, etc. This Shareholder's Agreement may not be
amended, modified, or waived in any respect except by an instrument in writing
duly executed by the party or parties bound thereby.
Section 4.5 Notices. All notices, requests or demands required or
permitted by this Shareholder's Agreement: (i) shall be in writing;
(ii) shall be deemed to have been given, forwarded, made or delivered: (x) if
delivered in person or by overnight courier service, when received, (y) if
transmitted by fax, when so transmitted if evidence of completed transmission
is received, and (z) if sent by registered or certified mail return receipt
requested, on the earlier of the date of receipt or the fifth day after it is
mailed; and (iii) shall be addressed: if to the Company, at 5555 San Felipe
Road, Suite 900, Houston, Texas 77056, telephone (713) 888-7800, fax (713)
888-7894, Attention: General Counsel (or to such other address as the Company
shall furnish by notice given to such Holder), and if to Stockholder, American
General Corporation, at 2929 Allen Parkway, Houston, Texas 77019, telephone
(713) 522-1111, fax (713) 831-1300, Attention: Robert M. Devlin, Vice
Chairman, with copies to American General Corporation, at 2929 Allen Parkway,
Houston, Texas 77019, telephone (713) 522-1111, fax (713) 831-1266,
Attention: Jon P. Newton, Senior Vice President and General Counsel, and to
Skadden, Arps, Slate, Meagher & Flom, at 919 Third Avenue, New York, New York
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10022, telephone (212) 735-3000, fax (212) 735-2000, Attention: Morris J.
Kramer (or to such other address as such party shall furnish by notice given
to the Company).
Section 4.6 Termination. Except as may otherwise be specifically
provided herein, this Agreement shall terminate on the Termination Date, and
all provisions of this agreement shall terminate as to any particular Shares,
upon the completion of a sale of such Shares in accordance with the terms of
this Agreement. This Shareholder's Agreement or any provision hereof may also
be terminated by a document executed in the manner provided for amendments to
this agreement in Section 4.4, with the same force and effect as provided
therein.
Section 4.7 Specific Performance, etc. Each person, by becoming a party
to this agreement, acknowledges and agrees that its breach or nonperformance
of any provision of this agreement, in accordance with the specific terms
hereof, would result in irreparable harm to the Company and to each other
Holder for which money damages would not provide an adequate remedy.
Accordingly, each person (i) agrees that the Company, Stockholder, and each
Holder shall be entitled to specific performance, injunctive or other
equitable relief against such person in the event of its breach or other
nonperformance of any of the provisions of this agreement; and (ii) waives any
requirement for the securing or posting of any bond in connection with such
remedy.
Section 4.8 Counterparts. This Shareholder's Agreement may be executed
in counterparts all of which together shall constitute a single agreement.
Section 4.9 Effectiveness. This Shareholder's Agreement shall become
effective upon the closing of the acquisition by Stockholder of the Shares;
provided, however, this Shareholder's Agreement shall be of no force and
effect if such closing does not occur prior to January 31, 1995.
Section 4.10 Amendments to Employment Agreements. The Company
hereby agrees that it will not alter, amend or rescind the amendments to the
Employment Agreements of Messrs. Poulos, Scott, Graf and McGimsey attached
hereto as Exhibits B, C, D and E in a manner that would adversely affect the
exception from the change in control provisions for Stockholder contained
therein.
Section 4.11 Assignment. Neither party to this Agreement may
assign any of its rights or obligations under this Agreement without the prior
consent of the other party except that the rights and obligations of
Stockholder may be assigned by Stockholder to any of its wholly owned
subsidiaries but no such assignment shall relieve Stockholder of its
obligations hereunder.
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<PAGE>
IN WITNESS WHEREOF, this Shareholder's Agreement has been executed and
delivered by the undersigned as of the date first above written.
WESTERN NATIONAL CORPORATION
By: /s/ Michael J. Poulos
Name: Michael J. Poulos
Title: President
AMERICAN GENERAL CORPORATION
By: /s/ Harold S. Hook
Name: Harold S. Hook
Title: Chairman and Chief Executive
Officer
<PAGE>
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EXHIBIT A
RESOLVED, that the board of directors hereby approves the acquisition by
American General of the Company's common stock from Conseco, which acquisition
will result in American General becoming an "interested stockholder" within
the meaning of Section 203 of the General Corporation Law of the State of
Delaware.
<PAGE>
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EXHIBIT B
AMENDMENT TO EMPLOYMENT AGREEMENT
This Amendment to Employment Agreement ("Amendment"), entered into
as of this 2nd day of December, 1994, by and between Western National
Corporation, a Delaware corporation ("Company"), and Michael J. Poulos
("Executive"),
W I T N E S S E T H:
WHEREAS, the Company and Executive have previously entered into an
Employment Agreement, dated September 9, 1993, providing for the
employment of Executive by the Company (the "Employment Agreement"); and
WHEREAS, the Company and Executive hereby wish mutually to amend
the Employment Agreement;
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants and agreements contained herein, the parties hereto
hereby agree as follows:
1. Subject to paragraph 3, paragraph (y) of Section
10(d)(iii) of the Employment Agreement is hereby amended and restated in
full as follows:
(y) no change of control shall be deemed to have
occurred if and when any such person becomes, with the
approval of the Board of Directors of the Company, the
beneficial owner of securities of the Company representing
25% or more but less than 50% of the combined voting power
of the Company's then outstanding securities entitled to
vote with respect to the election of its Board of Directors
and in connection therewith represents, and at all times
continues to represent, in a filing, as amended, with the
Securities and Exchange Commission on Schedule 13D or
Schedule 13G (or any successor Schedule thereto) that "such
person has acquired such securities for investment and not
with the purpose nor with the effect of changing or
influencing the control of the Company, nor in connection
with or as a participant in any transaction having such
purpose or effect", or words of comparable meaning and
import. The designation by any such person, with the
approval of the Board of Directors of the Company, of a
single individual to serve as a member of, or observer at
meetings of, the Company's Board of Directors, shall not be
considered "changing or influencing the control of the
Company" within the meaning of this paragraph, so long as
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such individual does not constitute at any time more than
one-third of the total number of directors serving on such
Board. Notwithstanding the foregoing, any action taken or
omitted to be taken by American General Corporation, a Texas
corporation ("AG") or its majority controlled subsidiaries
in accordance with and during the term of the Shareholder's
Agreement, dated as of December 2, 1994, between the Company
and AG, including, but not limited to, the acquisition of up
to an aggregate 79% of the shares of Common Stock of the
Company from time to time outstanding, and the designation
by AG of not more than two individuals as directors of the
Company, shall not constitute a change of control hereunder;
provided that the acquisition by any person other than AG or
a majority controlled subsidiary of AG of securities
representing more than 25% of the outstanding voting
securities of the Company shall not be deemed to be an
action taken or not taken by AG or a majority controlled
subsidiary of AG within the meaning of this Section.
2. Subject to the modification provided for in paragraph
1 hereof, the Employment Agreement shall remain in full force and
effect.
3. This amendment shall become effective upon the
consummation of the sale contemplated by the Stock Purchase Agreement,
dated as of December 2, 1994, between Conseco Investment Holding Company
and American General Corporation, providing for the acquisition by
American General Corporation of 24,947,500 shares of Company common
stock.
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Amendment as of the date first above written.
WESTERN NATIONAL CORPORATION
By: /s/ Richard W. Scott
Richard W. Scott
Executive Vice President
/s/ Michael J. Poulos
Michael J. Poulos
<PAGE>
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EXHIBIT C
AMENDMENT TO EMPLOYMENT AGREEMENT
This Amendment to Employment Agreement ("Amendment"), entered into
as of this 2nd day of December, 1994, by and between Western National
Corporation, a Delaware corporation ("Company"), and Richard W. Scott
("Executive"),
W I T N E S S E T H:
WHEREAS, the Company and Executive have previously entered into an
Employment Agreement, dated February 8, 1994, providing for the
employment of Executive by the Company (the "Employment Agreement"); and
WHEREAS, the Company and Executive hereby wish mutually to amend
the Employment Agreement;
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants and agreements contained herein, the parties hereto
hereby agree as follows:
1. Subject to paragraph 3, paragraph (y) of Section 10(d)
of the Employment Agreement is hereby amended and restated in full as
follows:
(y) no change of control shall be deemed to have
occurred if and when any such person becomes, with the
approval of the Board of Directors of the Company, the
beneficial owner of securities of the Company representing
25% or more but less than 50% of the combined voting power
of the Company's then outstanding securities entitled to
vote with respect to the election of its Board of Directors
and in connection therewith represents, and at all times
continues to represent, in a filing, as amended, with the
Securities and Exchange Commission on Schedule 13D or
Schedule 13G (or any successor Schedule thereto) that "such
person has acquired such securities for investment and not
with the purpose nor with the effect of changing or
influencing the control of the Company, nor in connection
with or as a participant in any transaction having such
purpose or effect", or words of comparable meaning and
import. The designation by any such person, with the
approval of the Board of Directors of the Company, of a
single individual to serve as a member of, or observer at
meetings of, the Company's Board of Directors, shall not be
considered "changing or influencing the control of the
Company" within the meaning of this paragraph, so long as
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such individual does not constitute at any time more than
one-third of the total number of directors serving on such
Board. Notwithstanding the foregoing, any action taken or
omitted to be taken by American General Corporation, a Texas
corporation ("AG") or its majority controlled subsidiaries
in accordance with and during the term of the Shareholder's
Agreement, dated as of December 2, 1994, between the Company
and AG, including, but not limited to, the acquisition of up
to an aggregate 79% of the shares of Common Stock of the
Company from time to time outstanding, and the designation
by AG of not more than two individuals as directors of the
Company, shall not constitute a change of control hereunder;
provided that the acquisition by any person other than AG or
a majority controlled subsidiary of AG of securities
representing more than 25% of the outstanding voting
securities of the Company shall not be deemed to be an
action taken or not taken by AG or a majority controlled
subsidiary of AG within the meaning of this Section.
2. Subject to the modification provided for in paragraph
1 hereof, the Employment Agreement shall remain in full force and
effect.
3. This amendment shall become effective upon the
consummation of the sale contemplated by the Stock Purchase Agreement,
dated as of December 2, 1994, between Conseco Investment Holding Company
and American General Corporation, providing for the acquisition by
American General Corporation of 24,947,500 shares of Company common
stock.
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Amendment as of the date first above written.
WESTERN NATIONAL CORPORATION
By: /s/ Michael J. Poulos
Michael J. Poulos
President
/s/ Richard W. Scott
Richard W. Scott
<PAGE>
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<PAGE>
EXHIBIT D
AMENDMENT TO EMPLOYMENT AGREEMENT
This Amendment to Employment Agreement ("Amendment"), entered into
as of this 2nd day of December, 1994, by and between Western National
Corporation, a Delaware corporation ("Company"), and John A. Graf
("Executive"),
W I T N E S S E T H:
WHEREAS, the Company and Executive have previously entered into an
Employment Agreement, dated February 8, 1994, providing for the
employment of Executive by the Company (the "Employment Agreement"); and
WHEREAS, the Company and Executive hereby wish mutually to amend
the Employment Agreement;
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants and agreements contained herein, the parties hereto
hereby agree as follows:
1. Subject to paragraph 3, paragraph (y) of Section 10(d)
of the Employment Agreement is hereby amended and restated in full as
follows:
(y) no change of control shall be deemed to have
occurred if and when any such person becomes, with the
approval of the Board of Directors of the Company, the
beneficial owner of securities of the Company representing
25% or more but less than 50% of the combined voting power
of the Company's then outstanding securities entitled to
vote with respect to the election of its Board of Directors
and in connection therewith represents, and at all times
continues to represent, in a filing, as amended, with the
Securities and Exchange Commission on Schedule 13D or
Schedule 13G (or any successor Schedule thereto) that "such
person has acquired such securities for investment and not
with the purpose nor with the effect of changing or
influencing the control of the Company, nor in connection
with or as a participant in any transaction having such
purpose or effect", or words of comparable meaning and
import. The designation by any such person, with the
approval of the Board of Directors of the Company, of a
single individual to serve as a member of, or observer at
meetings of, the Company's Board of Directors, shall not be
considered "changing or influencing the control of the
Company" within the meaning of this paragraph, so long as
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such individual does not constitute at any time more than
one-third of the total number of directors serving on such
Board. Notwithstanding the foregoing, any action taken or
omitted to be taken by American General Corporation, a Texas
corporation ("AG") or its majority controlled subsidiaries
in accordance with and during the term of the Shareholder's
Agreement, dated as of December 2, 1994, between the Company
and AG, including, but not limited to, the acquisition of up
to an aggregate 79% of the shares of Common Stock of the
Company from time to time outstanding, and the designation
by AG of not more than two individuals as directors of the
Company, shall not constitute a change of control hereunder;
provided that the acquisition by any person other than AG or
a majority controlled subsidiary of AG of securities
representing more than 25% of the outstanding voting
securities of the Company shall not be deemed to be an
action taken or not taken by AG or a majority controlled
subsidiary of AG within the meaning of this Section.
2. Subject to the modification provided for in paragraph
1 hereof, the Employment Agreement shall remain in full force and
effect.
3. This amendment shall become effective upon the
consummation of the sale contemplated by the Stock Purchase Agreement,
dated as of December 2, 1994, between Conseco Investment Holding Company
and American General Corporation, providing for the acquisition by
American General Corporation of 24,947,500 shares of Company common
stock.
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Amendment as of the date first above written.
WESTERN NATIONAL CORPORATION
By: /s/ Michael J. Poulos
Michael J. Poulos
President
/s/ John A. Graf
John A. Graf
<PAGE>
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EXHIBIT E
AMENDMENT TO EMPLOYMENT AGREEMENT
This Amendment to Employment Agreement ("Amendment"), entered into
as of this 2nd day of December, 1994, by and between Western National
Corporation, a Delaware corporation ("Company"), and Arthur R. McGimsey
("Executive"),
W I T N E S S E T H:
WHEREAS, the Company and Executive have previously entered into an
Employment Agreement, dated November 9, 1993, providing for the
employment of Executive by the Company (the "Employment Agreement"); and
WHEREAS, the Company and Executive hereby wish mutually to amend
the Employment Agreement;
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants and agreements contained herein, the parties hereto
hereby agree as follows:
1. Subject to paragraph 3, paragraph (y) of Section 10(d)
of the Employment Agreement is hereby amended and restated in full as
follows:
(y) no change of control shall be deemed to have
occurred if and when any such person becomes, with the
approval of the Board of Directors of the Company, the
beneficial owner of securities of the Company representing
25% or more but less than 50% of the combined voting power
of the Company's then outstanding securities entitled to
vote with respect to the election of its Board of Directors
and in connection therewith represents, and at all times
continues to represent, in a filing, as amended, with the
Securities and Exchange Commission on Schedule 13D or
Schedule 13G (or any successor Schedule thereto) that "such
person has acquired such securities for investment and not
with the purpose nor with the effect of changing or
influencing the control of the Company, nor in connection
with or as a participant in any transaction having such
purpose or effect", or words of comparable meaning and
import. The designation by any such person, with the
approval of the Board of Directors of the Company, of a
single individual to serve as a member of, or observer at
meetings of, the Company's Board of Directors, shall not be
considered "changing or influencing the control of the
Company" within the meaning of this paragraph, so long as
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such individual does not constitute at any time more than
one-third of the total number of directors serving on such
Board. Notwithstanding the foregoing, any action taken or
omitted to be taken by American General Corporation, a Texas
corporation ("AG") or its majority controlled subsidiaries
in accordance with and during the term of the Shareholder's
Agreement, dated as of December 2, 1994, between the Company
and AG, including, but not limited to, the acquisition of up
to an aggregate 79% of the shares of Common Stock of the
Company from time to time outstanding, and the designation
by AG of not more than two individuals as directors of the
Company, shall not constitute a change of control hereunder;
provided that the acquisition by any person other than AG or
a majority controlled subsidiary of AG of securities
representing more than 25% of the outstanding voting
securities of the Company shall not be deemed to be an
action taken or not taken by AG or a majority controlled
subsidiary of AG within the meaning of this Section.
2. Subject to the modification provided for in paragraph
1 hereof, the Employment Agreement shall remain in full force and
effect.
3. This amendment shall become effective upon the
consummation of the sale contemplated by the Stock Purchase Agreement,
dated as of December 2, 1994, between Conseco Investment Holding Company
and American General Corporation, providing for the acquisition by
American General Corporation of 24,947,500 shares of Company common
stock.
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Amendment as of the date first above written.
WESTERN NATIONAL CORPORATION
By: /s/ Michael J. Poulos
Michael J. Poulos
President
/s/ Arthur R. McGimsey
Arthur R. McGimsey
<PAGE>
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