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EX-21.1 - EX-21.1 - First Trinity Financial CORP | d70525exv21w1.htm |
EX-99.10 - EX-99.10 - First Trinity Financial CORP | d70525exv99w10.htm |
Table of Contents
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM S-1
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
FIRST TRINITY FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
Oklahoma | 6311 | 34-10011436 | ||
(State or other jurisdiction of | (Primary Standard Industrial | (I.R.S. Employer | ||
incorporation or organization) | Classification Code Number) | Identification Number.) |
7633 E. 63rd Place
Suite 230
Tulsa, OK 74133
(918) 249-2438
(Address, including zip code, and telephone number, including area code, of registrants principal executive offices)
Suite 230
Tulsa, OK 74133
(918) 249-2438
(Address, including zip code, and telephone number, including area code, of registrants principal executive offices)
Mr. Gregg Zahn
Chief Executive Officer
First Trinity Financial Corporation
7633 E. 63rd Place
Suite 230
Tulsa, OK 74133
(918) 249-2438
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Chief Executive Officer
First Trinity Financial Corporation
7633 E. 63rd Place
Suite 230
Tulsa, OK 74133
(918) 249-2438
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copy to:
P. David Newsome, Jr.
Cooper Newsome & Woosley PLLP
401 South Boston Avenue
Suite 3300, Mid-Continent Tower
Tulsa, Oklahoma 74103
(918) 592-3300
Cooper Newsome & Woosley PLLP
401 South Boston Avenue
Suite 3300, Mid-Continent Tower
Tulsa, Oklahoma 74103
(918) 592-3300
Approximate date of commencement of proposed sale to the public: As soon as practicable beginning
after this registration statement becomes effective.
If any of the securities being registered on this form are to be offered on a delayed or continuous
basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. ¨
If this form is filed to register additional securities for an offering pursuant to Rule 462(b)
under the Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same offering. ¨
Table of Contents
If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act,
check the following box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. ¨
If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act,
check the following box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated
filer, accelerated filer and smaller reporting company in rule 12b-2 of the Exchange Act.
Large accelerated filer ¨
Accelerated filer ¨
Non-accelerated filer ¨
Smaller reporting company þ
(Do not check if a smaller reporting company)
CALCULATION OF REGISTRATION FEE
Title of each Class of securities to be registered |
Amount to be registered(1) |
Offering price per share(2) |
Proposed maximum aggregate offering price(3) |
Amount of registration fee |
||||||||||
Common Stock, par value $.01 per share | 1,466,668 | $7.50 | $11,000,010 | $784.30 | ||||||||||
(1) | Includes 133,334 shares of common stock to cover over-subscriptions, if any, in excess of the
proposed maximum number of shares being offered. |
|
(2) | The common stock is not traded on any national exchange. The offering price was arbitrarily
determined by the registrant and bears no relationship to assets, earnings or any other
valuation criteria. |
|
(3) | Estimated in accordance with Rule 457 of the Securities Act of 1933, as amended. |
The registrant hereby amends this registration statement on such date or dates as may be necessary
to delay its effective date until the registrant shall file a further amendment which specifically
states that this registration statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall
become effective on such date as the Commission, acting pursuant to said Section 8(a), may
determine.
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THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THESE SECURITIES MAY
NOT BE SOLD UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS
EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN
OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
PROSPECTUS
FIRST TRINITY FINANCIAL CORPORATION
1,333,334 SHARES OF COMMON STOCK
This prospectus relates to a public offering of 1,333,334 shares of common stock, $.01 par
value per share, of First Trinity Financial Corporation for $7.50 per share. First Trinity
Financial Corporation is referred to as FTFC or the Company and the securities are referred to
as Common Stock or Shares. The Company will receive $8,500,000 after offering expenses and
sales commissions if all of the securities are sold.
Per Share | Total | |||||||
Public offering price |
$ | 7.50 | $ | 10,000,000 | ||||
Estimated offering expenses (excluding selling agent fees and expenses) |
$ | 0.38 | $ | 500,000 | ||||
Estimated selling agent fees and expenses |
$ | 0.75 | $ | 1,000,000 | ||||
Estimated net proceeds |
$ | 6.37 | $ | 8,500,000 |
The Shares will be offered and sold by our registered securities agents in the State of
Oklahoma. The Shares will be offered and sold on a best efforts basis. By best efforts we mean
that we are not required to sell any specific number or dollar amount of Shares. For a description
of the plan of distribution of these Shares, please see page 16 of this prospectus. Our securities
are not listed on a national securities exchange or quoted on the Over-the-Counter Bulletin Board
(OTCBB). There is no assurance that a market may be established in the future. We have
registered 133,334 Shares to cover over-subscriptions if any occur.
We will not accept subscriptions from any potential investor who does not meet one of the
following standards: (1) a minimum annual gross income of $65,000 and a minimum net worth of
$65,000 excluding vehicles, home and home furnishings; or (2) a minimum net worth of $150,000
excluding vehicles, home, and home furnishings. In addition, we will not accept subscriptions from
any potential investor who is investing more than 10% of their net worth, excluding vehicles, home
and home furnishings.
This offering will end on ____________, 2011, unless all of the Shares are sold before then. The
proceeds from the sale of Shares will be immediately available to us and will not be held in
escrow.
Our business and an investment in our Common Stock involve significant risks. You should
refer to the factors described in the section called Risk Factors beginning on page 6 of this
prospectus.
Neither the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or determined if this prospectus is truthful or
complete. Any representation to the contrary is a criminal offense.
The date of this Prospectus is ____________, 2010.
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You should rely only on the information contained in this prospectus. We have not authorized
anyone to provide you with information that is different. You should assume that information
appearing in this prospectus as well as the information we filed previously with the Securities and
Exchange Commission, or SEC, and incorporated herein by reference is accurate only as of the date
of the document containing the information.
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PROSPECTUS SUMMARY
This summary may not contain all the information that may be important to you. You should read
this entire prospectus, and the financial data and related notes that are incorporated by
reference, before making an investment decision.
You should pay special attention to the Risk Factors section beginning on page 10 of this
prospectus in determining whether an investment in our common stock is appropriate for you.
In this prospectus, references to the Company, we, us, our, First Trinity and
registrant refer to First Trinity Financial Corporation. Our life insurance subsidiary, Trinity
Life Insurance Company, is referred to as TLIC. Our premium finance subsidiary, First Trinity
Capital Corporation, is referred to as FTCC.
First Trinity Financial Corporation
First Trinity Financial Corporation is an Oklahoma corporation with offices at 7633 E.
63rd Place, Suite 230, Tulsa, Oklahoma 74133. The Companys telephone number is (918)
249-2438. The Company was incorporated on April 19, 2004 for the purpose of forming and/or
acquiring a life insurance company or insurance related companies and the formation of other
financial service businesses. We received our Certificate of Authority for TLIC from the Oklahoma
Department of Insurance on June 22, 2006. We incorporated our premium finance subsidiary, FTCC, in
February of 2006. We have been selling life insurance since March of 2007, and making premium
finance loans since January of 2007. On December 23, 2008, we purchased First Life America
Corporation (FLAC) from Brooke Capital Corporation. On August 31, 2009, we merged TLIC into FLAC
and immediately changed the name of FLAC to TLIC.
We are a holding company for an insurance company and a premium finance company. We operate
our insurance company in eight states and develop and market individual life insurance and annuity
products. We serve middle-income consumers, with a focus on seniors. We believe this is an
attractive, underserved, high growth market. We sell our products through independent producers
(some of whom sell one or more of our product lines exclusively). We operate our premium finance
company in three states and finance casualty insurance premiums through general insurance agencies.
State insurance holding company statutes applicable to us generally provide that no person may
acquire control of us, and thus indirect control of our insurance subsidiary, without prior
approval of the relevant state insurance commissioners. Generally, any person who acquires
beneficial ownership of 10% or more of our outstanding voting securities would be presumed to have
acquired such control unless the relevant state insurance commissioners upon application determine
otherwise. Beneficial ownership includes the acquisition, directly or indirectly (by revocable
proxy or otherwise), of our voting shares. If any person acquires 10% or more of the outstanding
shares of common stock in violation of such provisions, our insurance subsidiary or the state
insurance commissioner is entitled to injunctive relief, including enjoining any proposed
acquisition, or seizing shares of common stock owned by such person, and such shares of common
stock would not be entitled to be voted.
The Offering
Issuer
|
First Trinity Financial Corporation, an Oklahoma corporation | |
Securities Offered
|
1,333,334 Shares of Common Stock. The Company has registered an additional 133,334 Shares for over-subscriptions. |
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Common Stock Outstanding Before Offering |
5,805,000 shares. | |
Common Stock Outstanding After Offering (if maximum sold)
|
7,138,334 shares. The Company has registered an additional 133,334 shares for over-subscriptions, if any. | |
Minimum Subscription
|
Subscriptions will be subject to a minimum of 200 Shares ($1,500) and a maximum of 10,000 Shares ($75,000). | |
Plan of Distribution
|
Shares will be sold on a best efforts basis through agents of the Company registered in Oklahoma, who will receive a direct commission based upon such sales not to exceed 10%. See Plan of Distribution below for additional information. | |
Use of Proceeds
|
We estimate that our net proceeds from the sale of Shares in this offering, after deducting commissions and offering expenses, will be approximately $8,500,000 if the maximum number of Shares are sold. We intend to use the net proceeds for general corporate purposes, including working capital, to expand our premium finance subsidiary and for potential acquisitions. | |
Term of Offering
|
The offering will continue for one year from the date of this Prospectus unless all of the Shares are sold before then. We may extend the Offering for one additional year by a future amendment to our registration statement. | |
Risk Factors
|
See Risk Factors beginning on page 6 of this prospectus for a discussion of the risk factors you should carefully consider before deciding to invest in our common stock. | |
Suitability
|
We will not accept subscriptions from any potential investor who does not meet one of the following standards: (1) a minimum annual gross income of $65,000 and a minimum net worth of $65,000 excluding vehicles, home and home furnishings; or (2) a minimum net worth of $150,000 excluding vehicles, home, and home furnishings. In addition, we will not accept subscriptions from any potential investor who is investing more than 10% of their net worth, excluding vehicles, home and home furnishings. |
SELECTED CONSOLIDATED FINANCIAL INFORMATION
The following table provides summary historical consolidated financial data for the periods
and as of the dates indicated. You should read this information in conjunction with our audited
consolidated financial statements, including the related notes, and Managements Discussion and
Analysis of Financial Condition and Results of Operations which are included in our Annual Report
on Form 10-K for the fiscal year ended December 31, 2008, filed with the SEC. The summary
historical consolidated financial data for the three months ended September 30, 2009 and 2008, are
derived from our unaudited interim consolidated financial statements which are included in our
Quarterly Report on Form 10-Q for the period ended September 30, 2009, as filed with the SEC. The
quarterly data should be read in conjunction with notes and Managements Discussion and Analysis
of Financial Condition and Results of Operations included in the Quarterly Report.
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Nine Months Ended | ||||||||||||||||
September 30, | September 30, | Year Ended December 31, | ||||||||||||||
2009 | 2008 | 2008 | 2007 | |||||||||||||
(Unaudited) | (Unaudited) | |||||||||||||||
Statement of Operations Data |
||||||||||||||||
Premiums |
$ | 4,303,746 | $ | 1,209,081 | $ | 1,572,599 | $ | 972,547 | ||||||||
Income from premium financing |
494,207 | 335,403 | 503,885 | 183,927 | ||||||||||||
Net investment income |
1,494,531 | 147,865 | 164,924 | 476,482 | ||||||||||||
Net Realized investment losses |
(188,169 | ) | | | | |||||||||||
Total revenue |
6,104,315 | 1,692,349 | 2,241,408 | 1,635,956 | ||||||||||||
Total benefits and expenses |
6,266,917 | 2,113,957 | 2,747,092 | 2,146,531 | ||||||||||||
Loss before income taxes |
(162,602 | ) | (421,608 | ) | (505,864 | ) | (510,575 | ) | ||||||||
Income taxes |
143,339 | (832 | ) | (832 | ) | 832 | ||||||||||
Net loss |
$ | (305,941 | ) | $ | (420,776 | ) | $ | (504,852 | ) | $ | (511,407 | ) | ||||
Net loss per common share,
basic and diluted |
$ | (0.05 | ) | $ | (0.07 | ) | $ | (0.09 | ) | $ | (0.09 | ) | ||||
Balance Sheet Data at Period End |
||||||||||||||||
Total assets |
$ | 48,630,253 | $ | 12,991,686 | $ | 43,580,917 | $ | 12,528,238 | ||||||||
Total liabilities |
35,466,850 | 1,633,122 | 32,304,147 | 748,423 | ||||||||||||
Shareholders equity |
13,163,403 | 11,358,564 | 11,276,770 | 11,779,815 |
SPECIAL NOTE CONCERNING FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated herein by reference contain statements which
constitute forward looking statements within the meaning of the Private Securities Litigation
Reform Act of 1995 and other federal securities laws. Also, whenever we use words such as
believe, expect, anticipate, intend, plan, estimate or similar expressions, we are
making forward looking statements. For example, when we discuss in this prospectus or any of the
documents incorporated by reference future trends in the life insurance or premium finance
industries and our expectations based on such trends, we are using forward looking statements.
These forward looking statements are based upon our present intent, beliefs or expectations, but
forward looking statements are not guaranteed to occur and may not occur. Actual results may
differ materially from those contained in or implied by our forward looking statements as a result
of various factors.
Important factors that could cause actual results to differ materially from those in our
forward looking statements include, among others, general market conditions, including the recent
downturn in the economy and the growth in consumer debt, regulatory developments and other
conditions which are not within our control. Other risks may adversely impact us, as described
more fully in the section called Risk Factors. You should not place undue reliance upon forward
looking statements. Except as required by law, we undertake no obligation to update or revise any
forward looking statements as a result of new information, future events or otherwise.
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RISK FACTORS
Your investment in our common stock involves risk. You should carefully consider the risks
described below, as well as other information included or incorporated by reference in this
prospectus, before making a decision to buy our Common Stock. If any of the following risks
actually occurs, our business could be materially harmed. In that case, the value of our Common
Stock could decline, and you may lose all or part of your investment. You also should refer to the
other information in this Prospectus, including our financial statements and the related notes.
RISKS RELATED TO OUR BUSINESS
We have suffered operating losses for the years prior to this offering and have an accumulated
deficit of approximately $2.9 million at September 30, 2009.
We have experienced net losses since inception in 2004. TLIC has sustained losses for its
first two years of operation although we believe that with the purchase of FLAC and the merger of
FLAC and TLIC, the insurance subsidiary will improve its performance. Our premium finance
subsidiary showed a small profit in 2008. We cannot be certain that we will achieve or sustain
profitability on a quarterly or annual basis in the future.
In addition, although we are under no obligation to do so, we may elect to contribute
additional capital to strengthen the surplus of our insurance subsidiary for regulatory purposes or
to provide the capital necessary for growth. Any election regarding the contribution of additional
capital to our insurance subsidiary could affect the ability of our insurance subsidiary to pay
dividends.
We are a holding company and our liquidity and ability to meet our obligations may be constrained
by the ability of our insurance subsidiary to distribute cash to us.
We are a holding company with no business operations of our own. We depend on our initial
capital and operating subsidiaries for cash to pay administrative expenses. We receive interest
payments on surplus debentures from our insurance subsidiary, as well as cash from our
non-insurance subsidiary consisting of principal and interest payments. A deterioration in the
financial condition, earnings or cash flow of our subsidiaries for any reason could hinder the
ability of our subsidiaries to make disbursements to us. In addition, we may elect to contribute
additional capital to our insurance subsidiary to strengthen its surplus for regulatory purposes or
to provide the capital necessary for growth, in which case it is less likely that our insurance
subsidiary would pay dividends to us. Accordingly, this could limit our ability to satisfy holding
company financial obligations.
Payments from our non-insurance subsidiary do not require approval by any regulatory authority
or other third party. However, the payment of dividends or surplus debenture interest by our
insurance subsidiary is subject to state insurance department regulations and may be prohibited by
insurance regulators if they determine that such dividends or other payments could be adverse to
our policyholders or contract holders. Oklahoma Insurance Department regulations permit dividends
to be paid from statutory earned surplus of the insurance company without regulatory approval for
any 12-month period in amounts equal to the greater of statutory net gain from operations,
excluding realized capital gains, or 10% of insurers surplus as regards policyholders as of the
end of the preceding year. This type of dividend is referred to as ordinary dividends. Any
dividends in excess of these levels require the approval of the Oklahoma Insurance Commissioner.
This type of dividend is referred to as extraordinary dividends. Accordingly, any dividend
payments from our insurance subsidiary will require the prior approval of the Oklahoma Insurance
Commissioner.
Furthermore, risk-based capital (RBC) requirements and other capital requirements can also
limit, in certain circumstances, the ability of our insurance subsidiary to pay dividends. For
example, certain states have established minimum capital requirements for insurance companies
licensed to do business in their state.
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In addition, although we are under no obligation to do so, we may elect to contribute
additional capital to strengthen the surplus of our insurance subsidiary for regulatory purposes or
to provide the capital necessary for growth
There are risks to our business associated with the current economic environment.
Over the past year, the U.S. economy has experienced unprecedented credit and liquidity issues
and entered into a recession. Following several years of rapid credit expansion, a sharp
contraction in mortgage lending coupled with dramatic declines in home prices, rising mortgage
defaults and increasing home foreclosures, resulted in significant write-downs of asset values by
financial institutions, including government-sponsored entities and major commercial and investment
banks. These write-downs, initially of mortgage-backed securities but spreading to most sectors of
the credit markets, and to credit default swaps and other derivative securities, have caused many
financial institutions to seek additional capital, to merge with larger and stronger institutions,
to be subsidized by the U.S. government and, in some cases, to fail. Reflecting concern about the
stability of the financial markets, generally, and the strength of counterparties, many lenders and
institutional investors have reduced and, in some cases, ceased to provide funding to borrowers,
including other financial institutions. These factors, combined with declining business and
consumer confidence and increased unemployment, have precipitated an economic slowdown and fears of
a prolonged recession.
Even under more favorable market conditions, general factors such as the availability of
credit, consumer spending, business investment, capital market conditions and inflation affect our
business. For example, in an economic downturn, higher unemployment, lower family income, lower
corporate earnings, lower business investment and lower consumer spending may depress the demand
for life insurance and annuity products. In addition, this type of economic environment may result
in higher lapses or surrenders of policies. Accordingly, the risks we face related to general
economic and business conditions are more pronounced given the severity and magnitude of the recent
adverse economic and market conditions experienced.
More specifically, our business is exposed to the performance of the debt and equity markets,
which have been materially and adversely affected by recent economic developments. Adverse
conditions, including but not limited to, a lack of buyers in the marketplace, volatility, credit
spread changes, and benchmark interest rate changes, have affected and will continue to impact the
liquidity and value of our investments. We experienced realized losses during 2009 due to bond
defaults; however the recovery in the debt and equity market performance was beneficial to us
during 2009 due to having purchased the bonds and equity securities of FLAC in a depressed market.
Changes in interest rates that have adversely affected, and will continue to adversely affect,
our business, financial condition, growth and profitability include, but are not limited to, the
following:
A widening of credit spreads, such as the market experienced in 2008 could increase the net
unrealized loss position of our investment portfolio and may ultimately result in increased
realized losses. The value of our investment portfolio can also be affected by illiquidity and by
changes in assumptions or inputs we use in estimating fair value. Although the value of our
investments increased on an aggregate basis in 2009, there can be no assurance that higher realized
and/or unrealized losses will not occur in the future. Continued adverse capital market conditions
could result in further realized and/or unrealized losses.
Changes in interest rates also have other effects related to our investment portfolio. In
periods of increasing interest rates, life insurance policy loans, surrenders and withdrawals could
increase as policyholders seek investments with higher returns. This could require us to sell
invested assets at a time when their prices are depressed by the increase in interest rates, which
could cause us to realize investment losses. Conversely, during periods of declining interest
rates, we could experience increased premium payments on products with flexible premium features,
repayment of policy loans and increased percentages of policies remaining in-force. We would obtain
lower returns on investments made
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with these cash flows. In addition, borrowers may prepay or redeem bonds in our investment
portfolio so that we might have to reinvest those proceeds in lower yielding investments. As a
consequence of these factors, we could experience a decrease in the spread between the returns on
our investment portfolio and amounts credited to policyholders and contract owners, which could
adversely affect our profitability.
Increasing consumer concerns about the returns and features of our products or our financial
strength may cause existing customers to surrender policies or withdraw assets, and diminish our
ability to sell policies and attract assets from new and existing customers, which would result in
lower sales and revenues.
It is difficult to predict how long the current economic and market conditions will continue,
whether the financial markets will continue to deteriorate and which aspects of our products and/or
business will be adversely affected. However, the lack of credit, lack of confidence in the
financial sector, increased volatility in the financial markets and reduced business activity are
likely to continue to materially and adversely affect our business, financial condition and results
of operations.
The determination of the amount of realized investment losses recorded as impairments of our
investments is highly subjective and could have a material adverse effect on our operating results
and financial condition.
The determination of the amount of realized investment losses recorded as impairments vary by
investment type and is based upon our periodic evaluation and assessment of known and inherent
risks associated with the respective asset class. Such evaluations and assessments are revised as
conditions change and new information becomes available. We update our evaluations regularly and
reflect changes in realized investment gains and losses from impairments in operating results as
such evaluations are revised. Our assessment of whether unrealized losses are other-than-temporary
impairments requires significant judgment and future events may occur, or additional information
may become available, which may necessitate future impairments of securities in our portfolio.
Historical trends may not be indicative of future other-than-temporary impairments. For example,
the cost of our fixed maturity and equity securities is adjusted for impairments in value deemed to
be other than temporary in the period in which the determination is made. The assessment of whether
impairments have occurred is based on our case-by-case evaluation of the underlying reasons for the
decline in fair value.
The determination of the fair value of our fixed maturity securities results in unrealized net
investment gains and losses and is highly subjective and could materially impact our operating
results and financial condition.
In determining fair value, we generally utilize market transaction data for the same or
similar instruments. The degree of management judgment involved in determining fair values is
inversely related to the availability of market observable information. The fair value of financial
assets and financial liabilities may differ from the amount actually received to sell an asset or
the amount paid to transfer a liability in an orderly transaction between market participants at
the measurement date. Moreover, the use of different valuation assumptions may have a material
effect on the fair values of the financial assets and financial liabilities. As of September 30,
2009, our total unrealized net investment gains before deferred income taxes were $2,744,135.
If we fail to raise a significant portion of the Offering our plans to seek acquisitions and expand
the premium finance company will be effected.
If we do not raise a significant portion of the Offering, we will be limited to the size and
financing options available for any acquisitions of life insurance companies or life insurance
business. Additionally, we may have to use our bank line of credit to provide financing to expand
our premium finance business. Our target is to increase the loans financed to $7 million. This
may negatively impact our plan for growth of the Company.
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Our business is subject to extensive regulation.
Our insurance business is subject to extensive regulation and supervision in the jurisdictions
in which we operate. Our insurance subsidiary is subject to state insurance laws that establish
supervisory agencies. Such agencies have broad administrative powers including the power to grant
and revoke business licenses, regulate and supervise sales practices and market conduct, establish
guaranty associations, license agents, approve policy forms, establish reserve requirements,
prescribe the form and content of required financial statements and reports, determine the
reasonableness and adequacy of statutory capital and surplus, perform financial, market conduct and
other examinations, define acceptable accounting principles; and regulate the types and amounts of
permitted investments.
The regulations issued by state insurance agencies can be complex and subject to differing
interpretations. If a state insurance regulatory agency determines that our insurance subsidiary
is not in compliance with applicable regulations, the subsidiary is subject to various potential
administrative remedies including, without limitation, monetary penalties, restrictions on the
subsidiarys ability to do business in that state and a return of a portion of policyholder
premiums. In addition, regulatory action or investigations could cause us to suffer significant
reputational harm, which could have an adverse effect on our business, financial condition and
results of operations.
Our insurance subsidiary is also subject to RBC requirements. These requirements were designed
to evaluate the adequacy of statutory capital and surplus in relation to investment and insurance
risks associated with asset quality, mortality and morbidity, asset and liability matching and
other business factors. The requirements are used by states as an early warning tool to discover
companies that may be weakly-capitalized for the purpose of initiating regulatory action.
Generally, if an insurers RBC falls below specified levels, the insurer is subject to different
degrees of regulatory action depending upon the magnitude of the deficiency. The 2008 statutory
annual statements filed with the state insurance regulators reflected total adjusted capital in
excess of the levels subjecting the subsidiary to any regulatory action.
Our reserves for future insurance policy benefits and claims may prove to be inadequate, requiring
us to increase liabilities which results in reduced net income and shareholders equity.
Liabilities for insurance products are calculated using managements best judgments, based on
our past experience and standard actuarial tables of mortality, morbidity, lapse rates, investment
experience and expense levels. We establish reserves based on assumptions and estimates of factors
either established at the date of acquisition for business acquired or considered when we set
premium rates for business written.
Many factors can affect these reserves and liabilities, such as economic and social
conditions, changes in life expectancy and regulatory actions. Therefore, the reserves and
liabilities we establish are necessarily based on estimates, assumptions, industry data and prior
years statistics. It is possible that actual claims will materially exceed our reserves and have a
material adverse effect on our results of operations and financial condition.
We may be required to accelerate the amortization of the cost of policies produced or the value of
policies acquired.
Costs of policies produced represent the costs that vary with, and are primarily related to,
producing new insurance business. The value of policies acquired represents the value assigned to
the right to receive future cash flows from contracts in-force in FLAC at the date FLAC was
acquired. The balances of these accounts are amortized over the expected lives of the underlying
insurance contracts. On an ongoing basis, we test these accounts recorded on our balance sheet to
determine if these amounts are recoverable under current assumptions. In addition, we regularly
review the estimates and assumptions underlying these accounts for those products for which we
amortize the cost of policies produced or the value of business acquired in proportion to gross
profits or gross margins. If facts and circumstances
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change, these tests and reviews could lead to reduction in the balance of those accounts that
could have an adverse effect on the results of our operations and our financial condition.
Our operating results will suffer if policyholder surrender levels differ significantly from our
assumptions.
Surrenders of our annuities and life insurance products can result in losses and decreased
revenues if surrender levels differ significantly from assumed levels. The surrender charges that
are imposed on our fixed rate annuities typically decline during a penalty period, which ranges
from three to ten years after the date the policy is issued. Surrender charges are eliminated after
the penalty period. Surrenders and redemptions could require us to dispose of assets earlier than
we had planned, possibly at a loss. Moreover, surrenders and redemptions require faster
amortization of either the acquisition costs or the commissions associated with the original sale
of a product, thus reducing our net income. We believe policyholders are generally more likely to
surrender their policies if they believe the issuer is having financial difficulties, or if they
are able to reinvest the policys value at a higher rate of return in an alternative insurance or
investment product.
Changing interest rates may adversely affect our results of operations.
Our profitability is affected by fluctuating interest rates. While we monitor the interest
rate environment and our financial results could be adversely affected by changes in interest
rates. Our annuity business is subject to several inherent risks arising from movements in interest
rates, especially if we fail to anticipate or respond to such movements. First, interest rate
changes can cause compression of our net spread between interest earned on investments and interest
credited to customer deposits. Our ability to adjust for such a compression is limited by the
guaranteed minimum rates that we must credit to policyholders on certain products, as well as the
terms on most of our other products that limit reductions in the crediting rates to pre-established
intervals. Second, if interest rate changes produce an unanticipated increase in surrenders of our
annuity products, we may be forced to sell invested assets at a loss in order to fund such
surrenders. Third, the profits from other insurance products can be adversely affected when
interest rates decline because we may be unable to reinvest the cash from premiums received at the
interest rates anticipated when we sold the policies. Finally, changes in interest rates can have
significant effects on the market value and performance of our investments in general.
Concentration of our investment portfolios in any particular sector of the economy or type of asset
may have an adverse effect on our financial position or results of operations.
The concentration of our investment portfolios in any particular industry, group of related
industries, asset classes (such as residential mortgage-backed securities and other asset-backed
securities), or geographic area could have an adverse effect on its value and performance and,
consequently, on our results of operations and financial position. While we seek to mitigate this
risk by having a broadly diversified portfolio, events or developments that have a negative impact
on any particular industry, group of related industries or geographic area may have an adverse
effect on the investment portfolios to the extent that the portfolios are concentrated.
General market conditions affect investments and investment income.
The performance of our investment portfolio depends in part upon the level of and changes in
interest rates, risk spreads, market volatility, the performance of the economy in general, the
performance of the specific obligors included in our portfolio and other factors that are beyond
our control. Changes in these factors can affect our net investment income in any period, and such
changes can be substantial.
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Financial market conditions can also affect our realized and unrealized investment gains
(losses). During periods of rising interest rates, the fair values of our investments will
typically decline. Conversely, during periods of falling interest rates, the fair values of our
investments will typically rise.
Competition from companies that have greater market share, higher ratings, greater financial
resources and stronger brand recognition, may impair our ability to retain existing customers and
sales representatives, attract new customers and sales representatives and maintain or improve our
financial results.
We sell life insurance and fixed annuities and have a relatively small market share. Many of
our competitors are larger companies that have higher financial strength ratings, greater capital,
technological and marketing resources. Recent industry consolidation, including business
combinations among insurance and other financial services companies, has resulted in larger
competitors with even greater financial resources. Furthermore, changes in federal law have
narrowed the historical separation between banks and insurance companies, enabling traditional
banking institutions to enter the insurance and annuity markets and further increase competition.
This increased competition may harm our ability to improve our profitability.
In addition, because the actual cost of products is unknown when they are sold, we are subject
to competitors who may sell a product at a price that does not cover its actual cost. Accordingly,
if we do not also lower our prices for similar products, we may lose market share to these
competitors. If we lower our prices to maintain market share, our profitability will decline.
We must attract and retain sales representatives to sell our insurance and annuity products.
Strong competition exists among insurance and financial services companies for sales
representatives. We compete for sales representatives primarily on the basis of our financial
position, financial strength ratings, support services, compensation, products and product
features. Our competitiveness for such agents also depends upon the relationships we develop with
these agents. If we are unable to attract and retain sufficient numbers of sales representatives
to sell our products, our ability to compete and our revenues and profitability would suffer.
Tax law changes could adversely affect our insurance product sales and profitability.
We sell deferred annuities and some forms of life insurance that are attractive, in part,
because policyholders generally are not subject to U.S. federal income tax on increases in policy
values until some form of distribution is made. Congress has enacted legislation to lower marginal
tax rates, to reduce the U.S. federal estate tax gradually over a ten-year period (with total
elimination of the U.S. federal estate tax in 2010) and to increase contributions that may be made
to individual retirement accounts and 401(k) accounts. While these tax law changes are scheduled to
expire at the beginning of 2011 absent future congressional action, they could, in the interim,
diminish the appeal of our annuity and life insurance products because the benefit of tax deferral
is lessened when tax rates are lower and because fewer people may purchase these products when they
can contribute more to individual retirement accounts and 401(k) accounts. Additionally, Congress
has considered, from time to time, other possible changes to U.S. tax laws, including elimination
of the tax deferral on the accretion of value within certain annuities and life insurance products.
Such a change would make these products less attractive to prospective purchasers and therefore
would likely cause our sales of these products to decline.
We face risk with respect to our reinsurance agreements.
We transfer exposure to certain risks to others through reinsurance arrangements. Under these
arrangements, other insurers assume a portion of our losses and expenses associated with reported
and unreported claims in exchange for a portion of policy premiums. The availability, amount and
cost of reinsurance depend on general market conditions and may vary significantly. As of December
31, 2008, our reinsurance receivables totaled $.9 million. Our ceded life
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insurance in-force totaled $44.3 million. When we obtain reinsurance, we are still liable for
those transferred risks if the reinsurer cannot meet its obligations. Therefore, the inability of
our reinsurers to meet their financial obligations may require us to increase liabilities, thereby
reducing our net income and shareholders equity.
Our insurance subsidiary may be required to pay assessments to fund other companies policyholder
losses or liabilities and this may negatively impact our financial results.
The solvency or guaranty laws of most states in which an insurance company does business may
require that company to pay assessments up to certain prescribed limits to fund policyholder losses
or liabilities of other insurance companies that become insolvent. Insolvencies of insurance
companies increase the possibility that these assessments may be required. These assessments may be
deferred or forgiven under most guaranty laws if they would threaten an insurers financial
strength and, in certain instances, may be offset against future premium taxes. We cannot estimate
the likelihood and amount of future assessments. Although past assessments have not been material,
if there were a number of large insolvencies, future assessments could be material and could have a
material adverse effect on our operating results and financial position.
We may not be able to obtain a favorable insurance rating.
Insurance ratings have become an increasingly important factor in establishing the competitive
position of insurance companies. Ratings reflect the rating agencies opinion of an insurance
companys financial strength, operating performance and ability to meet its obligations to
policyholders. There can be no assurance that our insurance company will be rated by a rating
agency or that a rating, if and when received, will be favorable to the insurance subsidiary.
Our premium finance business will be subject to risk.
Our premium finance business is subject to the risk that we will not be able to successfully
market our products, the possibility of interest rate changes which could affect the profitability
of the business, the possibility of regulatory changes including limits on the amount of interest
which could be charged, the insolvency of an insurance company or agency whose premiums have been
financed and the competition from other premium finance companies that have greater capitalization
and have existing business in the states in which we operate.
RISK RELATED TO THE OFFERING AND OWNERSHIP OF OUR COMMON STOCK
No market exists or is expected to develop for the Common Stock.
There is currently no existing public or other market for the Common Stock. The development
of a public trading market, if any, will depend upon the Companys ability to meet the listing
requirements on an exchange or trading system. There is no assurance that the Company will be able
to meet those standards.
We have no plans to pay dividends on our Common Stock, and you may not receive funds without
selling your Common stock.
We have not declared or paid cash dividends on our Common Stock and do not anticipate paying
such dividends in the foreseeable future. We currently intend to retain available funds to finance
our operations and growth. Future dividend policy will be at the discretion of our board of
directors and will depend on our earnings, capital requirements, financial condition and other
relevant factors. See Description of Securities below for additional information.
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Accordingly, you may have to sell some or all of your common stock in order to generate cash
from your investment. Because there is no public market for the stock, you may not receive a gain
when you sell our common stock and you may lose the entire investment.
This offering is being made on a best efforts basis, and we cannot assure you that the offering
will be successful.
We are making this offering on a best efforts basis through our registered securities
agents. These agents will be able to offer and sell securities in Oklahoma only. If we expand the
offering to other states we will have to engage the services of a FINRA-member broker-dealer to
assist us in those states. We cannot assure you that we will be successful in engaging a
broker-dealer to assist us. While some of our agents have prior securities experience from our
previous offerings, we will recruit and train new agents who will not be experienced securities
salespersons. This lack of experience may have a negative impact on our ability to complete this
offering. There can be no assurance that all of the offering will be sold. If less than all of the
Shares are sold prior to the termination of this offering, we will have lesser funds available for
our business purposes, and our prospects may be materially and adversely affected. See Use of
Proceeds, and Plan of Distribution, below for additional information.
You will suffer an immediate and substantial dilution in the net tangible book value of the Shares
you purchase.
There will be an immediate and substantial dilution in the book value of each purchasers
investment. The dilution would be a minimum of $4.47 per share or 60% of the $7.50 offering price
if all the Shares offered are sold and could be substantially higher depending upon the number of
Shares sold. This dilution, which is influenced by our net losses from operations, is due in large
part to the fact that prior investors in the Company paid an average price of $2.67 per share when
they purchased their shares of Common Stock, which is substantially less than the offering price of
$7.50 per Share in this Offering. See Dilution below for additional information.
Our management will have broad discretion in using the net proceeds of this 0ffering.
Although we intend to reserve a substantial portion of the offering for the acquisition of
other life insurance companies or blocks of life insurance business, we intend to utilize a portion
of the net proceeds of the offering to expand the business of our premium finance company and for
working capital. While such acquisitions require approval of the insurance commissioner in the
appropriate state, management will have absolute and broad discretion regarding the selection of
any acquisition. Investors will be dependent upon the judgment and ability of management to select
an acquisition that meets to financial and operational objectives of the Company. Investors will
also be dependent upon managements judgment regarding timing of an acquisition. In addition,
prospective investors who invest in the Company will be entirely dependent on the judgment of our
management in connection with the allocation of the funds raised herein for working capital. There
can be no assurance that determinations ultimately made by such persons relating to the specific
allocation of those proceeds will permit us to achieve our business objectives. See Use of
Proceeds below for additional information.
This offering has not been independently reviewed.
We are offering the Shares directly through issuer agents. While we have reserved the right to
place the Shares through the services of a stock broker, the Shares in all likelihood will be sold
without the use of an investment banker. Consequently, no independent review of the offering has
been, or will likely be, made by any investment banker.
The offering price of the Shares has been fixed exclusively by our management.
While our management has reviewed and considered our assets, operations, and the acquisition
of FLAC in relationship to our initial offerings, the offering price is arbitrarily determined by
the company and bears no relationship
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to assets, earnings, or any other valuation criteria. No assurance can be given that the
shares offered hereby will have a market value or that they may be sold at this, or at any price.
See Determination of Offering Price below for additional information.
We and our agents in this offering must comply with federal broker and dealer laws, and a
failure to comply with these laws would materially and adversely affect our financial condition.
We do not plan to use the services of a broker/dealer to place the Shares. Instead, we will
offer the Shares through certain of our agents and employees that have been registered as our
agents in Oklahoma. See Plan of Distribution below for additional information. Neither we nor
any of our agents have registered with FINRA as a broker or a dealer but have relied on a
statutory exemption for a broker or dealer whose business is exclusively within a single state and
who does not make use of any facility of a national securities exchange. Should a determination be
made that any of the individual agents recruited to sell the Shares was acting in violation of the
statutory exemption, we could be subject to the voidability of contract provisions of the
securities laws for any transactions made in violation of the securities acts.
We are highly dependent upon our key personnel, and the loss of any of our key personnel could
materially and adversely affect our business.
Our ability to operate successfully will be dependent primarily upon the efforts of Gregg
Zahn, our President and CEO. We have an employment agreement with Mr. Zahn and a $1 million key
man life insurance policy on his life but the loss of his services could have a materially adverse
effect on our ability to operate successfully.
Our officers and directors will own 13.3% of our Common Stock and will continue to have
substantial control over us following this offering.
As of the date of this prospectus, our officers and directors own approximately 16.36% of the
outstanding shares of our Common Stock. In the event that all of the shares are sold pursuant to
this Prospectus, our officers and directors will own approximately 13.3% of the outstanding shares
of our Common Stock. See Security Ownership below for additional information. As a result,
the officers and directors will be able to continue to influence decisions requiring shareholder
approval, including election of the directors and all corporate actions and changes. This could
limit the ability of purchasers in this offering to influence the outcome of key transactions.
State insurance laws may delay, deter or prevent a takeover attempt that may be in the best
interests of stockholders.
State insurance laws include provisions that may delay, deter or prevent a takeover attempt
that may be in the best interests of stockholders. For example, under applicable state insurance
holding company laws and regulations, no person may acquire control of us, and thus indirect
control of our insurance subsidiary, unless the person has provided required information to, and
the acquisition is approved or not disapproved by, the appropriate insurance regulatory
authorities. Under applicable laws and regulations, any person acquiring, directly by stock
ownership or indirectly (by revocable proxy or otherwise) 10% or more of the voting power of our
capital stock would be presumed to have acquired control of us, and a person who beneficially
acquires 10% or more of our shares of common stock without obtaining the approval of the
appropriate state insurance commissioners would be in violation of state insurance holding company
statutes and would be subject to injunctive action requiring disposition or seizure of the shares
and prohibiting the voting of such shares, as well as other action determined by the state
insurance commissioners, unless the appropriate insurance regulatory authorities, upon advance
application, determine otherwise. Even in the absence of a takeover attempt, the existence of these
provisions may adversely affect the prevailing market price of our common stock.
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USE OF PROCEEDS
The Company intends to use the proceeds to finance future acquisition of life insurance
companies or blocks of life insurance business, expand our premium finance business and increase
working capital. We have a target of $7 million in premiums financed by our premium finance
subsidiary, FTCC. To reach our premium finance target, we may use, up to $2,000,000 of the
proceeds from this offering and a revolving line of credit provided by the First National Bank of
Muskogee in the amount of $3,600,000. We intend to use the remainder of the proceeds to fund the
acquisition of life insurance companies or blocks of life insurance business and for working
capital. If we do not sell all of the Shares offered by this Prospectus, we may apply a lesser
amount to our premium finance business so that we will have cash available for acquisitions and
working capital. We are not now in negotiations to acquire any other life insurance company or
block of insurance business. We will use up to 10% of the proceeds to pay sales commissions to our
agents and an additional 5% of the proceeds to pay additional offering costs.
The following table summarizes the anticipated use of the gross proceeds from the sale of
Shares, assuming all Shares offered are sold. It should be noted, however, that certain of these
figures are only estimates and are subject to change, particularly if less than all of the shares
offered are sold. There can be no assurance that actual experience will approach this anticipated
use of proceeds:
Maximum Offering | ||||
of 1,333,334 Shares | ||||
Expenses of the offering (1) |
||||
Sales commissions (2) |
$ | 1,000,000 | ||
Legal, accounting , printing and office expense |
160,000 | |||
Agent recruitment and training |
340,000 | |||
Expansion of premium finance business (3) |
2,000,000 | |||
Available for acquisitions (3) |
5,000,000 | |||
Working Capital (3) |
1,500,000 | |||
Total |
$ | 10,000,000 | ||
(1) | Includes fees and expenses for legal, accounting, registration and our transfer agent and
printing and mailing costs in connection with the Offering. Also includes agent recruiting,
training, and registration expenses, as well as amounts paid for prizes and bonuses to sales
personnel in connection with their sales efforts. In no event will sales commissions and other
offering expenses exceed 15% of the gross proceeds. |
|
(2) | The Companys sales agents will be paid commissions ranging from 7% to 10% of the Shares sold
by them. The table assumes that all commissions will be 10%. |
|
(3) | The Company will use the net proceeds in the following order of priority; (1) acquisition of
life insurance companies or blocks of life insurance business, (2) working capital, and (3)
additional funds for the expansion of our premium finance business. The Company may alter the
priorities if funds are needed for the expansion of the premium finance business prior to the
proceeds being used for other purposes. |
DETERMINATION OF OFFERING PRICE AND MARKET DATA
There is no public market for the Common Stock and, therefore, the Shares have no readily
ascertainable market value. Our management has determined the price of the Shares being offered by
this Prospectus arbitrarily, and without the input of any third party. The offering price bears no
relationship to assets, earnings, or any other valuation criteria.
No assurance can be given that the Common Stock offered hereby will have a market value or
that they may be sold at this, or at any price. The Shares are offered only as a long-term
investment for those who can afford the risk of loss of
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their entire investment and who can foresee
no need to liquidate their investment in the near future. Management considered the price at which
its previous offerings had been made, the increase in assets since the last offering, the dilution
to existing shareholders, the increase in business in both the life insurance and premium finance
business since the last offering and the acquisition of FLAC.
DILUTION
As of September 30, 2009, we had an aggregate of 5,805,000 shares of Common Stock outstanding
and a net book value, as reflected on our balance sheet, of $13,163,403 or approximately $2.27 per
share. Net book value per share represents our total assets less liabilities, divided by the
number of shares of Common Stock outstanding.
After the offering, if $10 million is raised from the sale of 1,333,334 shares, we will have
an aggregate of 7,138,334 shares outstanding and a net book value of $21,663,403 (assuming net
proceeds from the Shares being sold of $8,500,000) or approximately $3.03 per share. New Shares
will experience an immediate dilution in net book value per Share of $4.47 from the $7.50 per Share
purchase price, while the present shareholders will receive an immediate increase in the net book
value of $.76 per share. Such dilution represents the difference between the offering price per
Share and the net book value per Share immediately after completion of the offering assuming there
is no change in net book value other than from the sale of Shares. The increase in book value per
Share held by the current shareholders would be solely attributable to the cash paid by new
shareholders for their Shares.
PLAN OF DISTRIBUTION
We are offering up to 1,333,334 Shares on a best efforts basis only through a network of
agents recruited, trained, and registered as our agents. We will not accept subscriptions from any
potential investor who does not meet one of the following standards: (1) a minimum annual gross
income of $65,000 and a minimum net worth of $65,000 excluding vehicles, home and home furnishings;
or (2) a minimum net worth of $150,000 excluding vehicles, home, and home furnishings. In
addition, we will not accept subscriptions from any potential investor who is investing more than
10% of his or her net worth, excluding vehicles, home and home furnishings.
Commissions
to be paid to agents on each sale will range from 7% - 10% of the amount of the
Shares sold. In addition, the agents may receive prizes and other incentives for their sales
efforts. All agents must employ the suitability standards for subscribers as set forth in the
Subscription Agreement.
Our agents will be registered as issuer-agents with the Oklahoma Department of Securities.
These agents will be limited to making offers and sales to Oklahoma residents. In the event we
elect to offer the shares in other states we will use the services of a broker-dealer licensed in
that state. At that time we will enter into an underwriting agreement that will provide for the
terms and conditions for the offering in that jurisdiction. Neither we nor any of our agents have
registered with the Securities and Exchange Commission as a broker or a dealer in reliance on a
statutory exemption for a broker or dealer whose business is exclusively intrastate and who does
not make use of any facility of a national securities exchange. Should a determination be made that
any of the individual agents recruited to sell the Shares were acting in violation of statutory
exemption, we could be subject to the voidability of contracts provisions of Section 29(b) of the
Exchange Act for any transactions made in violation of that act. See, Risk Factors We and our
agents in this offering must comply with federal broker and dealer laws, and a failure to
comply with these laws would materially and adversely affect our financial condition.
The purchase price shall be payable in cash at the time of subscription. Subscriptions are
made by executing a Subscription Agreement and by payment of the purchase price by a check made
payable to First Trinity Financial Corporation. Each subscriber will be required to represent to the Company that they meet the
income and net worth requirements for this offering.
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The offering will continue until all of the 1,333,334 Shares being offered are sold or until
one year from the date of this Prospectus, whichever occurs first. We may, in our sole discretion,
extend the Offering for one additional year. We also may increase the numbers of Shares in this
offering by 133,334 Shares if the offering is over-subscribed.
DESCRIPTION OF SECURITIES
Capital Stock
The authorized capital stock of the Company consists of 20,000,000 shares of Common Stock, par
value $.01 per share, of which there are 5,805,000 shares issued and outstanding and 550,000 shares
of Preferred Stock, par value $.01 per share, none of which have been designated or issued. The
following summarizes the important provisions of the Companys capital stock.
Common Stock
In the event of liquidation, holders of the shares of Common Stock are entitled to participate
equally per Share in all of our assets, if any, remaining after the payment of all liabilities and
any liquidation preference on our preferred stock if any is outstanding with a liquidation
preference. Holders of the Shares are entitled to such dividends as the Board of Directors, in its
discretion, may declare out of funds available therefore, subject to any preference in favor of
outstanding shares of preferred stock, if any. The holders of Shares are entitled to one vote for
each Share held of record in each matter submitted to a vote of shareholders. A majority of the
outstanding shares of stock entitled to vote constitutes a quorum at any shareholder meeting. There
are no preemptive or other subscription rights, conversion rights, cumulative voting, and
registration or redemption provisions with respect to any shares of Common Stock. The rights,
preferences, and privileges of holders of Common Stock are subject to, and may be adversely
affected by, the rights of the owners of any series of Preferred Stock that we may designate and
issue in the future.
Preferred Stock
The Board of Directors is authorized to issue up to 550,000 shares of Preferred Stock in one
or more series. The Board of Directors of the Company, without further action by the shareholders,
may issue shares of Preferred Stock and may fix or alter the voting rights, redemption provisions
(including sinking fund provisions), dividend rights, dividend rates, liquidation preferences,
conversion rights, and the designation of a number of shares constituting any wholly unissued
series of preferred stock. The Company does not anticipate the issuance of any Preferred Shares at
this time. In the event that Preferred Shares are to be issued, promoters will be allowed to
purchase such shares only on the same terms as existing or new shareholders. In addition, the
issuance of preferred shares will only occur upon the approval of a majority of our independent
directors.
The actual effect of the authorization of the Preferred Stock upon the rights of the holders
of Common Stock is unknown until the Board of Directors of the Company determines the specific
rights of owners of any series of Preferred Stock. Depending upon the rights granted to any series
of Preferred Stock, the voting power, liquidation preference, or other rights of common stock could
be adversely affected.
Oklahoma Law and Certain Charter Provisions
Under the Oklahoma General Corporation Act (the Oklahoma Act), mergers, consolidations and
sales of substantially all of the assets of an Oklahoma Corporation must generally be approved by a
vote of the holders of a majority of the outstanding shares of stock entitled to vote thereon.
Section 1090.3 of the Oklahoma Act, however,
restricts certain transactions between an Oklahoma corporation (or its majority owned
subsidiaries), and a holder of 15% or more of the corporations outstanding voting stock, together
with affiliates or associates thereof (an interested
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shareholder). For a period of three years
following the date that a shareholder becomes an interested shareholder, Section 1090.3 prohibits
the following types of transactions between the corporation and the interested shareholder (unless
certain conditions, described below, are met): (i) mergers or consolidations; (ii) sales, leases,
exchanges or other transfers of 10% or more of the aggregate assets of the corporation; (iii) the
issuances or transfers by the corporation of any stock of the corporation that would have the
effect of increasing the interested shareholders proportionate share of the stock of any class or
series of the corporation; (iv) receipt by the interested shareholder of the benefit, except
proportionately as a shareholder of the corporation, of any loans, advances, guarantees, pledges or
other financial benefits provided by the corporation; (v) any other transaction which has the
effect of increasing the proportionate share of the stock of any class or series of the corporation
that is owned by the interested shareholder; and (vi) any share acquisition by the interested
shareholder from the corporation pursuant to Section 1090.1 of the Oklahoma Act. These
restrictions do not apply if: (1) before such person becomes an interested shareholder, the board
of directors approved the transaction in which the interested shareholder becomes an interested
shareholder or approved the business combination; or (2) upon consummation of the transaction which
resulted in the shareholder becoming an interested shareholder, the interested shareholder owned at
least 85% of the voting stock of the corporation outstanding at the time the transaction commenced,
excluding for purposes of determining the number of shares outstanding, those shares owned by (a)
persons who are directors and also officers, and (b) employee stock plans in which employee
participants do not have the right to determine confidentially whether shares held subject to the
plan will be tendered in any tender or exchange offer; or (3) at or subsequent to such date, the
business combination is approved by the board of directors and authorized at an annual or special
meeting of shareholders, and not by written consent by the affirmative vote of at least two-thirds
of the outstanding voting stock which is not owned by the interested shareholder. The provisions
of Section 1090.3 are not currently applicable to the Company, but will become so in the event that
the Common Stock (or another class of our voting stock) is subsequently listed on a national
securities exchange, authorized for quotation on the NASDAQ Stock Market, or held of record by
1,000 or more shareholders.
The Oklahoma Act also contains provisions regulating a control share acquisition, which
effectively deny voting rights to shares in an Oklahoma corporation acquired in control share
acquisitions unless a resolution granting such voting rights is approved at a meeting of
shareholders by an affirmative majority of all voting power, excluding all interested shares. A
control share acquisition is one by which a purchasing shareholder acquires more than 1/5th,
1/3rd or a majority, under various circumstances, of the voting power of the stock of an issuing
public corporation. An issuing public corporation is an Oklahoma corporation that has (i) any
class of securities registered pursuant to Section 12 or subject to Section 15(d) of the Securities
Exchange Act of 1934; (ii) 1,000 or more shareholders; and (iii) either (a) more than 10% of its
shareholders resident in Oklahoma; (b) more than 10% of its shares owned by Oklahoma residents; or
(c) 10,000 shareholders resident in Oklahoma.
Our Certificate of Incorporation limits, to the fullest extent permitted by Oklahoma law, the
liability of a director to the Company or our shareholders for monetary damages for a breach of
such directors fiduciary duty as a director. Oklahoma law presently permits such limitations of a
directors liability except where a director breaches his or her duty of loyalty to the Company or
our shareholders, fails to act in good faith or engages in intentional misconduct or a knowing
violation of law, authorizes payment of an unlawful dividend or stock repurchase, or obtains an
improper personal benefit. This provision is intended to afford directors additional protection,
and limit their potential liability, from suits alleging a breach of the duty of care by a
director. We believe this provision will assist the Company in maintaining and securing the
services of directors who are not employees of the Company.
Our Bylaws provide that directors and officers shall be indemnified against liabilities
arising from their services as directors and/or officers to the fullest extent permitted by law,
which generally requires that the individual act in good faith and in a manner he or she reasonably
believes to be in or not opposed to the Companys best interests. We have obtained directors and
officers liability insurance to limit our exposure under these provisions.
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Transfer Agent
Computershare Trust Company, 350 Indiana Street, Suite 800, Golden, Colorado 80401 is the
transfer agent for our Common Stock. Our transfer agents phone number is 303-262-0600.
LEGAL MATTERS
The validity of the Shares offered by this prospectus will be passed upon for the Company by
Cooper, Newsome & Woosley PLLP, 401 South Boston Avenue, Suite 3300, Mid-Continent Tower, Tulsa,
Oklahoma 74103.
EXPERTS
The consolidated financial statements as of December 31, 2008 and 2007 and for each of the two
years ended December 31, 2008, incorporated by reference in this prospectus from the Companys
Annual Report on Form 10-K for the fiscal year ended December 31, 2008, have been so included in
reliance on the report of Kerber, Eck & Braeckel LLP, an independent registered public accounting
firm, given on the authority of said firm as experts in auditing and accounting.
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES
FOR SECURITIES ACT LIABILITIES
Insofar as indemnification for liabilities arising under the Securities Act may be permitted
to directors, officers and controlling persons of the Company pursuant to the foregoing provisions,
the Company has been advised that in the opinion of the SEC such indemnification is against public
policy as expressed in the Securities Act and is therefore unenforceable.
INCORPORATION BY REFERENCE
We have filed the following documents with the SEC, which are incorporated herein by
reference:
| Annual Report on Form 10-K, as amended, for the fiscal year ended December 31, 2008. |
||
| Quarterly Report on Form 10-Q for the quarter ending September 30, 2009. |
||
| Definitive Proxy Statement for the annual meeting of shareholders held May 20, 2009. |
||
| Current Report on Form 8-K filed on May 1, 2009. |
||
| Current Report on Form 8-K filed on June 17, 2009. |
We also incorporate by reference all documents subsequently filed by us with the SEC pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934 until all of the
securities that may be offered by this prospectus are sold. We are not, however, incorporating by
reference any documents or portions thereof, whether specifically listed above or filed in the
future, that are not deemed filed with the SEC. Any statements contained in this prospectus, in
an amendment hereto or in a document incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this prospectus to the extent that a statement contained
herein or in any subsequently filed document that is also incorporated by reference herein modifies
or supersedes such statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute as part of this prospectus.
We will provide without charge to each person, including any beneficial owner, to whom this
prospectus is delivered, upon written or oral request of such person, a copy of any or all of the
documents that have been or that may be incorporated by reference in this prospectus. Exhibits to the filings will not be sent,
however, unless those exhibits have been specifically incorporated by reference in this prospectus.
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Requests for such documents should be addressed in writing or by telephone to John R. Perkins,
our Secretary and Director of Compliance at First Trinity Financial Corporation, 7633 E.
63rd Place, Suite 230, Tulsa, OK 74133. Our telephone number is (918) 249-2438 and our
corporate website is www.firsttrinityfinancial.com. The information which appears on our website is
not part of this prospectus.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the information reporting requirements of the Securities Exchange Act of
1934, as amended, or the Exchange Act, and accordingly file annual, quarterly and current reports,
proxy statements and other information with the SEC. Members of the public may read and copy any
materials we file with the SEC at the SECs Public Reference Room located at 100 F Street, N.E.,
Washington, DC 20549. Information on the operation of the Public Reference Room may be obtained by
calling the SEC at 1-800-SEC-0330.
In addition, we are required to file electronic versions of these materials with the SEC
through the SECs Electronic Data Gathering, Analysis and Retrieval database system, or EDGAR.
Copies of the registration statement of which this prospectus is a part and its exhibits, as well
as of our annual reports, quarterly reports, proxy statements and other filings may be examined
without charge via the EDGAR database. The web address of the EDGAR database is www.sec.gov. They
are also available on our website, www.firsttrinityfinancial.com. Our website is not a part of this
prospectus.
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PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution.
The estimated expenses payable by the Company in connection with the offering of the
securities being registered are as follows:
SEC filing fee |
$ | 784 | ||
Agent recruitment and training |
340,000 | |||
Legal fees and expenses |
40,000 | |||
Accounting fees and expenses |
40,000 | |||
Printing and mailing |
20,000 | |||
Transfer agent fees |
10,000 | |||
Miscellaneous |
49,216 | |||
Total |
$ | 500,000 | ||
Item 14. Indemnification of Directors and Officers.
Our Bylaws require indemnification to the extent permitted by law of any director, officer,
employee, and agent who is a party or is threatened to be made a party to any action, suit, or
proceeding if he or she acted in good faith and in a manner he or she reasonably believed to be in,
or not opposed to the best interests of, the Company. Insofar as indemnification for liability
arising under the Securities Act of 1933 (the Act) may be permitted to directors, officers, and
controlling persons of the Company pursuant to the foregoing provisions, or otherwise, we have been
advised that in the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
Item 15. Recent Sales of Unregistered Securities
The Company sold 2,000,000 common shares at $.10 per share to its organizing shareholders in
April of 2004 for total proceeds of $200,000, in reliance upon exemptions from registration
provided by Section 4(2) of the Securities Act, and Rule 506 of Regulation D promulgated
thereunder. No underwriter was involved in connection with the issuance of our shares, and we paid
no finders fees in the April 2004 private placement. On May 21, 2004, we undertook a private
placement of 1,000,000 shares of common stock for gross proceeds of $1,250,000. This private
placement, which was concluded on August 31, 2004, was conducted in reliance upon exemptions from
registration provided by Section 4(2) of the Securities Act and Rule 506 of Regulation D
promulgated thereunder. No underwriter was involved in connection with the issuance of our shares,
and we paid no finders fees in the private placement. On June 22, 2005 the Company registered
2,550,000 shares to be sold at $5.00 per share in an intrastate public offering with the Oklahoma
Securities Commission for gross proceeds in the amount of $12,750,000 with a 10% oversale
provision. The offering was sold by issuer agents registered with the Oklahoma Securities
Commission. That offering was completed on February 23, 2007 with gross proceeds of $14,025,000
including the 10% oversale. The offering was sold pursuant to an exemption from registration
provided by Section 3(a)(11) of the Securities Act of 1933, as amended, and Rule 147 promulgated
thereunder.
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Item 16. Exhibits and Financial Schedules
(a) Exhibits
See the Exhibit Index immediately following the signature page hereto, which is incorporated
by reference as if fully set forth herein.
(b) Financial Statement Schedules
None
Item 17. Undertakings
The registrant undertakes:
(1) | To file, during any period in which it offers or sells securities, a post-effective amendment
to this registration statement: |
(i) | To include any prospectus required by Section 10(a)(3) of the Securities Act; |
||
(ii) | To reflect in the prospectus any facts or events which, individually or together,
represent a fundamental change in the information in the registration statement; and
notwithstanding the foregoing, any increase or decrease in the volume of securities offered
(if the total dollar value of securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the Calculation of Registration Fee table in
the effective registration statement; and |
||
(iii) | To include any additional or changed material information on the plan of distribution. |
(2) | That, for the purpose of determining any liability under the Securities Act of 1933, each
such post-effective amendment shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof. |
|
(3) | To remove from registration by means of a post-effective amendment any of the securities
being registered which remain unsold at the termination of the offering. |
|
(4) | That, for the purpose of determining liability under the Securities Act of 1933 to any
purchaser: |
|
Each prospectus filed by the registrant pursuant to Rule 424(b) as part of a registration
statement relating to an offering, other than registration statements relying on Rule 430B or
other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and
included in the registration statement as of the date it is first used after effectiveness.
Provided, however, that no statement made in a registration statement or prospectus that is part
of the registration statement or made in a document incorporated or deemed incorporated by
reference into the registration statement or prospectus that is part of the registration
statement will, as to a purchaser with a time of contract of sale prior to such first use,
supersede or modify any statement that was made in the registration statement or prospectus that
was part of the registration statement or made in any such document immediately prior to such
date of first use. |
||
The undersigned registrant hereby undertakes, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrants annual report pursuant to section 13(a)
or section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plans annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement |
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shall be deemed to be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the initial bona fide
offering thereof. |
||
The undersigned registrant hereby undertakes to deliver or cause to be delivered with the
prospectus, to each person to whom the prospectus is sent or given, the latest annual report to
security holders that is incorporated by reference in the prospectus and furnished pursuant to
and meeting the requirements of Rule 14a-3 or Rule14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be presented by Article 3 of
Regulation S-X and are not set forth in the prospectus, to deliver, or cause to be delivered to
each such person to whom the prospectus is sent or given, the latest quarterly report that is
specifically incorporated by reference in the prospectus to provide such interim financial
information. |
||
Insofar as indemnification for liabilities arising under the Securities Act of 1933, may be
permitted to directors, officers and controlling persons of the registrant pursuant to the
foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy as expressed in
the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is against public policy
as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such
issue. |
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this
registration to be signed on its behalf by the undersigned, thereunto duly authorized in Tulsa,
Oklahoma on December 10, 2009
FIRST TRINITY FINANCIAL CORPORATION an Oklahoma corporation |
||||
December 21, 2009
|
By: | /s/Gregg Zahn | ||
Gregg Zahn, President and Chief Executive Officer | ||||
December 21, 2009
|
By: | /s/William Lay | ||
William Lay, Treasurer and Chief Financial Officer |
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and appoints each of Gregg Zahn
and William Lay, or any of them, as his true and lawful attorney-in-fact and agent, each with full
power of substitution and resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign this Registration Statement on Form S-1 and any and all amendments including
post-effective amendments thereto, and all other documents in connection therewith, with the
Securities and Exchange Commission, necessary or advisable to enable the registrant to comply with
the Securities Act of 1933, and any rules, regulations and requirements of the Securities and
Exchange Commission, in respect thereof, in connection with the registration of the securities
described herein which are the subject of such Registration Statement, as the case may be, which
amendments may make such changes in such Registration Statement, as the case may be, as such
attorney may deem appropriate, granting unto said attorneys-in-fact and agents full power and
authority to do and perform each and every act and thing necessary or advisable to be performed or
done in connection with any or all of the above-described matters, as fully as each of the
undersigned could do in person, hereby ratifying and approving all acts of any such attorney or
substitute.
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed by the following persons in the capacities and on the dates indicated.
Signature | Title | Date | ||||
|
||||||
By
|
/s/Gregg Zahn | President, Chief Executive Officer and Director | December 21, 2009 | |||
Gregg Zahn | ||||||
By
|
/s/Scott J. Engebritson | Chairman of the Board and Director | December 21, 2009 | |||
Scott J. Engebritson | ||||||
By
|
/s/William S. Lay | Treasurer, Chief Financial Officer and Director | December 21, 2009 | |||
William S. Lay | ||||||
By
|
/s/John R. Perkins | Secretary and Director | December 21, 2009 | |||
John R. Perkins | ||||||
By
|
/s/H. Bryan Chrisman | Director | December 21, 2009 | |||
H. Bryan Chrisman | ||||||
By
|
/s/Bill H. Hill | Director | December 21, 2009 | |||
Bill H. Hill, Director |
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By
|
/s/Charles Wayne Owens | Director | December 21, 2009 | |||
Charles Wayne Owens | ||||||
By
|
/s/Loren Everett Owens | Director | December 21, 2009 | |||
Loren Everett Owens | ||||||
By
|
/s/George E. Peintner | Director | December 21, 2009 | |||
George E, Peintner | ||||||
By
|
/s/G. Wayne Pettigrew | Director | December 21, 2009 | |||
G. Wayne Pettigrew | ||||||
By
|
/s/Gary L. Sherrer | Director | December 21, 2009 | |||
Gary L. Sherrer | ||||||
By
|
/s/Shannon B. Young | Director | December 21, 2009 | |||
Shannon B. Young |
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EXHIBIT INDEX
Exhibit No. | Description |
3.1 | Amended Certificate of Incorporation, incorporated by reference to Exhibit 3.1 to the
Companys Current Report on Form 8-K filed June 17, 2009. |
|
3.2 | By-laws, as amended and restated, incorporated by reference to Exhibit 3.1 to the
Companys Current Report on Form 8-K filed May 1, 2009. |
|
4.1 | Specimen Stock Certificate, incorporated by reference to Exhibit 4 to the Companys
Registration Statement on Form 10SB12G filed April 30, 2007. |
|
5.1** | Opinion of Cooper Newsome & Woolsey PLLP. |
|
10.1 | Administrative Service Agreement between TLIC (formerly FLAC) and IHLIC, incorporated by
reference to Exhibit 10.1 to the Companys Current Report on Form 8-K filed June 17, 2009. |
|
10.2 | Lease Agreement, incorporated by reference to Exhibit 10.2 to the Companys Registration
Statement on Form 10SB12G filed April 30, 2007. |
|
10.3 | Reinsurance Agreement with Investors Heritage Life Insurance Company is incorporated by
reference to Exhibit 10.3 to the Companys Registration Statement on Form 10SB12G/A filed
July 23, 2007 |
|
10.4 | Reinsurance Agreement with Munich American Reinsurance Company is incorporated by
reference to Exhibit 10.4 to the Companys registration statement on Form 10SB12G/A filed
July 23, 2007 |
|
10.5 | Employment Agreement of Gregg Zahn, President, dated October 30, 2007, incorporated by
reference to Exhibit 10.5 to the Companys Quarterly Report on Form 10-QSB filed November
14, 2007. |
|
10.6 | First Amendment to Lease Agreement between First Trinity Financial Corporation and Amejak
Limited Partnership dated July 1, 2008, incorporated by reference to Exhibit 10.6 to the
Companys Annual report on Form 10-K filed April 14, 2009. |
|
10.7 | Amendment to Employment Agreement of Gregg Zahn, President dated March 13, 2008,
incorporated by reference to Exhibit 10.1 to the Companys Current Report on form 8-K filed
April 14, 2008. |
|
10.8 | Lease Agreement dated July 10, 2006 between First Life America Corporation and the United
States of America, incorporated by reference to Exhibit 10.7 of the Companys Annual Report
on Form 10-K filed April 14, 2009. |
|
10.9 | Lease Agreement dated August 2, 2006 between First Life America Corporation and the
United States of America, incorporated by reference to Exhibit 10.8 of the Companys Annual
Report on Form 10-K filed April 14, 2009. |
|
10.10 | Employment Agreement of William S. Lay, dated April 18, 2009, incorporated by reference
to Exhibit 10.1 to the Companys Current Report on Form 8-K filed April 22, 2009. |
|
10.11 | Loan agreement between First Trinity Capital Corporation and First National Bank of
Muskogee dated March 12, 2009, incorporated by reference to the companys Quarterly Report
on form 10-Q filed May 15, 2009. |
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10.12 | Loan guaranty agreement between First Trinity Capital Corporation and First National
Bank of Muskogee dated March 12, 2009, incorporated by reference to the companys Quarterly
Report on form 10-Q filed May 15, 2009. |
|
10.13 | Administrative Services Agreement between First Life America Corporation and Investors
Heritage Life Insurance Company dated June 16, 2009, incorporated by reference to Exhibit
10.1 to the Companys Current Report on Form 8-K filed June 17, 2009. |
|
10.14 | First Amendment to Administrative Services Agreement between Trinity Life Insurance
Company and Investors Heritage Life Insurance Company incorporated by reference to Exhibit
10.2 to the Companys Current Report on Form 8-K filed June 17, 2009. |
|
21.1* | Subsidiaries of First Trinity Financial Corporation. |
|
23.1** | Consent of Cooper Newsome & Woolsey PLLP (included as part of its opinion filed as Exhibit
5.1 hereto). |
|
23.2** | Consent of Kerber, Eck and Braeckel, LLP. |
|
24.1* | Powers of Attorney (included in the signature pages hereto, and incorporated herein by
reference) |
|
99.1 | Oklahoma Insurance Holding Company Disclaimer of Control of Gregg Zahn, incorporated by
reference to Exhibit 99.1 to the Companys Registration Statement on Form 10SB12G filed on
April 20, 2007. |
|
99.2 | Form of Promotional Shares Escrow Agreement (six year restriction), is incorporated by
reference to Exhibit 99.2 to the Companys Registration Statement on Form 10SB12G filed
April 20, 2007. |
|
99.3 | Form of Promotional Shares Escrow Agreement (four year restriction), is incorporated by
reference to Exhibit 99.3 to the Companys Registration Statement on Form 10SB12G filed on
April 20, 2007. |
|
99.4 | Termination of Oklahoma Insurance Holding Company Disclaimer of Control between the
Oklahoma Department of Insurance and Gregg Earl Zahn dated August 2, 2007 is incorporated by
reference to Exhibit 99.4 to the Companys Form 10-K filed on March 31, 2008. |
|
99.5 | First Life America Corporation unaudited financial statements for the period ending
September, 30, 2008, incorporated by reference to the Companys Form 10-K filed on April 14,
2009. |
|
99.6 | First Life America Corporation audited financial statements for the years ended December
31, 2007 and 2006, incorporated by reference to the Companys Form 10-K filed on April 14,
2009. |
|
99.7 | Pro forma condensed financial information for the acquisition of First Life America
Corporation on December 23, 2008, incorporated by reference to the Companys Form 10-K filed
on April 14, 2009. |
|
99.8 | Form R Oklahoma Redomestication Application of First Life America Corporation,
incorporated by reference to Exhibit 99.1 to the Companys Current Report on Form 8-K filed
June 17, 2009. |
|
99.9 | Completion of acquisition of First Life America Corporation, , incorporated by reference
to Exhibit 99.1 to the Companys Current Report on Form 8-K filed January 26, 2009. |
|
99.10* | Subscription Agreement |
|
* | Filed herewith |
|
** | To be filed by amendment |
27