UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of the earliest event reported): FEBRUARY 19, 1997
(FEBRUARY 17, 1997)
STANDARD MANAGEMENT CORPORATION
(Exact name of registrant as specified in its charter)
0-20882
(Commission file number)
Indiana No. 35-1773567
(State of incorporation) (IRS employer identification no.)
9100 Keystone Crossing
Indianapolis, Indiana 46240
(Address of principal executive offices) (Zip Code)
(317) 574-6200
(Telephone)
<PAGE>
STANDARD MANAGEMENT CORPORATION
ITEM 5. OTHER EVENTS
On February 17, 1997, Standard Management Corporation ("SMC" or the
"Registrant"), and Savers Life Insurance Company ("Savers Life") entered
into an amendment to the Agreement and Plan of Merger. This Amendment to
Agreement and Plan of Merger is attached hereto as Exhibit 2.5.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits:
2.5 Amendment to Agreement and Plan of Merger dated as of
February 17, 1997 by and among SMC and Savers Life.
<PAGE>
STANDARD MANAGEMENT CORPORATION
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
STANDARD MANAGEMENT CORPORATION
(Registrant)
Date: FEBRUARY 19, 1997 By: /S/ RONALD D. HUNTER
Ronald D. Hunter
Chairman of the Board, President and
Chief Executive Officer
AMENDMENT
TO
AGREEMENT AND PLAN OF MERGER
AMENDMENT TO AGREEMENT AND PLAN OF MERGER, dated as of February
17, 1997, among STANDARD MANAGEMENT CORPORATION, an Indiana corporation
("SMC"), STANDARD ACQUISITION CORPORATION, a North Carolina Corporation
("SAC") and SAVERS LIFE INSURANCE COMPANY, a North Carolina domestic stock
insurance company ("Savers") (SAC and Savers being hereinafter collectively
referred to as the "Constituent Corporations").
RECITALS
WHEREAS, SMC, SAC and Savers agreed to the merger of SAC with and into
Savers (the "Merger") and executed an Agreement and Plan of Merger dated as
of December 19, 1996 (the "Merger Agreement") to specify the terms of the
Merger;
WHEREAS, the parties intended that the Merger qualify as a tax-free
reorganization within the meaning of Section 368(a) of the Internal Revenue
Code of 1986, as amended (the "Code"); and
WHEREAS, the parties now desire to amend the Merger Agreement to
effect their intention that the Merger qualify as a tax-free reorganization
within the meaning of Code Section 368(a) to satisfy the requirements
imposed pursuant to Code Sections 368(a)(1)(A) and 368(a)(2)(E) with
respect to a reverse triangular reorganization transaction;
NOW THEREFORE, pursuant to Section 15.7 of the Merger Agreement and in
consideration of the mutual representations, warranties and covenants made
herein and of the mutual benefits to be derived herefrom, the parties
hereto agree to amend the Merger Agreement as follows:
1. AMENDMENT TO CASH CONSIDERATION. Section 2.5(c) of the Agreement
shall be deleted in its entirety and the following shall be inserted
therefor:
"(c) Subject to the provisions of SECTIONS 2.10 and 2.12
hereof, each share of Savers Common Stock issued and outstanding
immediately prior to the Effective Time (other than shares to be
canceled in accordance with SECTION 2.5(A)) shall be converted
into (i) subject to SECTION 2.6, below, $1.50 in cash, plus (ii)
$6.50 in value of shares of SMC Common Stock, the number of such
shares, to be rounded to the nearest hundredth of a share,
determined by dividing $6.50 by the average of the closing
trading prices as reported by the NASDAQ National Market (the
"Average Trading Price") of SMC Common Stock for the ten (10)
consecutive trading days ending on the fifth day prior to the
earlier of the SMC Stockholders Meeting or the Savers
Stockholders Meeting, plus (iii) the Performance Premium
described in ARTICLE III, below. All such shares of Savers
Common Stock, when so converted, shall no longer be outstanding
and shall automatically be canceled and retired, and each holder
of a Certificate (as defined in SECTION 2.8(A)) representing any
such shares shall cease to have any rights with respect thereto,
except the right to receive shares of SMC Common Stock, cash as
provided in this SECTION 2.5 and SECTION 2.6 and the Performance
Premium, certain dividends and other distributions as
contemplated by SECTION 2.9 and any cash in lieu of fractional
shares to be issued or paid in consideration therefor upon
surrender of such Certificate in accordance with SECTION 2.8."
2. AMENDMENT TO STOCK ELECTION. Section 2.6 of the Merger Agreement
shall be deleted in its entirety and the following shall be inserted
therefor:
"2.6 STOCK ELECTION. Each holder of Savers Common Stock may
elect to receive SMC Common Stock in lieu of the cash to which
such holder would otherwise be entitled pursuant to SECTION
2.5(C). In the event that any holder of Savers Common Stock
shall make such election, such holder shall be entitled to
receive for each share of Savers Common Stock so held, in lieu of
the cash into which such Savers Common Stock would otherwise be
converted pursuant to SECTION 2.5(C), an additional number of
shares of SMC Common Stock, rounded to the nearest hundredth of a
share, determined by dividing $1.50 by the Average Trading Price
applied in SECTION 2.5(C)."
3. AMENDMENTS TO ARTICLE III INTRODUCTORY LANGUAGE. The first three
lines of Article III of the Merger Agreement immediately preceding Section
3.1 of the Merger Agreement shall be deleted in their entirety and the
following shall be inserted therefor:
"A holder of record of Savers Common Stock at the Effective
Time ("Record Holder") shall have the following contractual right
to receive shares of SMC Common Stock, together with interest
payable in cash, subject to the terms and conditions contained
herein:"
4. AMENDMENT TO PERFORMANCE PREMIUM ELECTION PROVISIONS. Section
3.4 of the Agreement shall be deleted in its entirety and the following
shall be inserted therefor:
"3.4 SMC COMMON STOCK AND INTEREST.
(a) The 1997 Performance Premium and the 1998
Performance Premium shall be payable in SMC Common Stock and in
cash (as interest) as hereinafter determined. The portion of
the 1997 Performance Premium and the portion of the 1998
Performance Premium that shall be payable in cash shall be the
portion that represents interest computed using the applicable
federal rate (short-term) established in Code Section 1274(d) for
the month during which the Effective Time pursuant to SECTION 2.2
occurs. The portions of the 1997 Performance Premium and the
1998 Performance Premiums that represent interest determined in
accordance with the immediately preceding sentence shall be the
only portions of Performance Premium that shall be payable in
cash (with the exception of cash paid as Performance Premium in
lieu of fractional shares). The payment of the Performance
Premium in shares of SMC Common Stock that is not payable in cash
as interest shall consist of the number of shares of SMC Common
Stock determined by dividing (i) the amount to which each Record
Holder would be entitled in payment of such Performance Premium
reduced by the allocable portion of the interest by (ii) the
Average Trading Price of SMC Common Stock for the ten (10)
consecutive trading days ending on the fifth day prior to the
payment date of such Performance Premium, rounded to the nearest
hundredth of a share. SMC shall pay cash in lieu of issuing
certificates or scrip for fractional shares.
(b) The 1997 Performance Premium and the 1998
Performance Premium shall be calculated as of December 31, 1997,
and December 31, 1998, respectively, based upon the Surviving
Corporation's Annual Statements for the years then ended as filed
with the North Carolina Department of Insurance. The
calculations shall be made no later than April 30, 1998 and 1999,
and the payment dates shall be no later than May 31, of 1998 and
1999, respectively.
(c) The maximum aggregate value of the 1997 Performance
Premium and the 1998 Performance Premium payable pursuant to this
Merger Agreement shall be $6,000,000."
5. AMENDMENT TO DELIVERY OF PERFORMANCE PREMIUMS PROVISIONS.
Section 3.5(a) of the Merger Agreement shall be deleted in its entirety and
the following shall be inserted therefor:
"(a) Promptly after the calculation by SMC of the final 1997
Performance Premium and the final 1998 Performance Premium, as
the case may be, SMC shall deliver, to the Exchange Agent in
trust for the Record Holders, the cash representing interest and
the SMC Common Stock payable with respect to such Performance
Premium."
6. AMENDMENT TO EXCHANGE AGENT PERFORMANCE PREMIUM DELIVERY
PROVISIONS. The words, ",without interest," in the eighth line of
Section 3.5(d) shall be deleted. It is the intention of the parties that
the 1997 Performance Premium and the 1998 Performance Premium be calculated
in accordance with the provisions of this Article III, as the case may be,
and that the portions of the 1997 Performance Premium and the 1998
Performance Premiums that constitute interest (computed using the
applicable federal rate (short-term) established in Code Section 1274(d)
for the month during which the Effective Time pursuant to SECTION 2.2
occurs) be determined and paid in cash. The parties further intend that
the remaining portions of the 1997 Performance Premium and the 1998
Performance Premium be paid in SMC Common Stock, with the exception of any
portion of the Performance Premium that would require the issuance of
fractional shares, which portion shall also be paid in cash by SMC.
IN WITNESS WHEREOF, this AMENDMENT TO AGREEMENT AND PLAN OF
MERGER has been duly executed and delivered by the parties hereto,
effective as of the date first written above.
STANDARD ACQUISITION CORPORATION
By: /s/ Edward T. Stahl
Name: Edward T. Stahl
Title: Executive Vice President
STANDARD MANAGEMENT CORPORATION
By: /s/ Edward T. Stahl
Name: Edward T. Stahl
Title: Executive Vice President
SAVERS LIFE INSURANCE COMPANY
By: /s/ Jerry D. Stoltz
Name: Jerry D. Stoltz
Title: President
