PROPOSED AGREEMENT OF MERGER (03/08/98)

Proposed Agreement of merger between the UNA and the UNAAA

PROPOSED AGREEMENT OF MERGER

between the

UKRAINIAN NATIONAL ASSOCIATION

and the

UKRAINIAN NATIONAL AID ASSOCIATION OF AMERICA

THIS AGREEMENT is made and entered into this 30th day of January, 1998, by and between the UKRAINIAN NATIONAL ASSOCIATION, INC., a Fraternal Benefit Association organized and existing under the laws of the State of New Jersey, with principal offices located at 2200 Route 10, Parsippany, New Jersey 07054 or its successor organization which will or may be created as a result of a proposed merger with the UKRAINIAN FRATERNAL ASSOCIATION of Scranton, Pennsylvania (all references to UNA shall mean the existing society or the merged society with the Ukrainian Fraternal Association) and the UKRAINIAN NATIONAL AID ASSOCIATION OF AMERICA, Inc., a Fraternal Benefit Association organized and existing under the laws of the State of Pennsylvania, with its principal offices located at 925 North Western Avenue , Chicago, Ill. 60622, (hereinafter sometimes UNAAA).

WHEREAS, the UNA and the UNAAA are both fraternal benefit organizations with compatible objectives and derive its membership from the same ethnic and cultural base, and

WHEREAS, these objectives can be accomplished more readily if the members of both societies make a common effort through a single society,

NOW, THEREFORE, it is mutually agreed between these parties hereto as follows:

ARTICLE ONE

1. The Ukrainian National Association, Inc.(or its successor Association) and the Ukrainian National Aid Association of America, Inc. shall merge into a single Fraternal Association to be known as the Ukrainian National Association, Inc., as of the effective date of this Agreement, i.e. the latter of the dates of receipt and filing of the Certificates of Approval from the Commonwealth of Pennsylvania and the State of New Jersey Commissioners of Insurance.

2. On the effective date of this Agreement, the separate existence of each society shall cease, and the two Associations shall be merged in one Fraternal Benefit Association and the lodges of both the UNA and the UNAAA shall become chartered lodges of the merged society. Such lodges and its members are to be governed thenceforth by the constitution, by-laws and regulations of the successor society, as amended.

3. On the effective date of this Agreement, all members of the Ukrainian National Aid Association of America, Inc. shall cease to be members of the individual society and shall become members of the Ukrainian National Association, Inc. and its lodges, with all rights, privileges and obligations pertaining thereto. The officers elected for the lodges of the Ukrainian National Association, Inc. and Ukrainian National Aid Association of America, Inc. shall become officers of lodges of the successor society in corresponding capacities without formality or necessity of election and shall serve until their successors have been elected and installed in compliance with the by-laws of the successor society. However, the Supreme or Executive Assembly of the UNAAA, meaning the members of its Supreme Executive Committee, its Supreme Auditors and its Supreme Advisors and Honorary Members thereof shall cease holding office on that date.

ARTICLE TWO

1. On the effective date of this Agreement, all obligations of the Ukrainian National Association, Inc. and Ukrainian National Aid Association of America, Inc. relating to certificates and contracts of insurance issued by both Associations and in force or subject to reinstatement on that date shall be assumed by and become obligations of the successor society , subject to all defenses and set-offs which would have been available to either of said Associations had this Agreement not been made.

2. The Ukrainian National Association, Inc. will administer certificates and contracts to which such obligations relate according to their terms, which, to the extent applicable, are intended to include: the terms of the current Articles of Incorporation, Constitution, By-Laws, and Rules and Regulations of the Ukrainian National Association, Inc. and the Articles of Incorporation, Constitution, and By-Laws of said Ukrainian National Association, Inc. as same shall be amended, if at all, for the purpose of this merger.

3. Certificates and contracts shall participate in future distribution of surplus by the Ukrainian National Association, Inc. as permitted by law and to the extent determined by its actuary and approved by the Board of Directors of the Ukrainian National Association, Inc., if such certificates and contracts are in force at the time of such distribution.

4. On and after the effective date of this Agreement, premiums and other payments required by such certificates and contracts of both Associations, shall be due only to the Ukrainian National Association, Inc. and paid to it through its established systems, or such systems as may hereafter be established.

5. Upon the effective date of the merger, all the rights, franchises, and interests of the merged societies in and to every type of property real, personal or mixed and things in action thereunto belonging, shall be vested in the Ukrainian National Association, Inc., without any other instrument needing to be executed, except as may be required law or by regulation promulgated by the Insurance Commissioner or his/her equivalent of any State or Province having jurisdiction thereover. Conveyances of real property may be evidenced by proper deeds as set forth in N.J.S.A.17:44A-8.

6. On the effective date of this Agreement, all contractual and other obligations of the Ukrainian National Association, Inc. and of the Ukrainian National Aid Association of America, Inc., of whatever nature, shall be assumed by and become the obligation of the Ukrainian National Association, Inc. subject, however, to all defenses and set-offs that would have been available to either Association had this Agreement not been made. On the effective date of this Agreement, the Ukrainian National Association, Inc. and the Ukrainian National Aid Association of America, Inc. shall deliver to the Ukrainian National Association, Inc., assembled in such form as shall be required, all information in its possession or control relating to its (i) certificates and contracts of insurance then in force or subject to reinstatement, (ii) members, (iii) local assemblies or lodges, and (iv) contractual and other obligations other than those relating to certificates and contracts of insurance then in force or subject to reinstatement.

7. On the effective date of this Agreement, the UNA and the UNAAA shall, by proper acts and instruments, unless exempted by N.J.S.A.17:44A-8, transfer and convey to the Ukrainian National Association, Inc. all property, of whatever nature, then belonging to both Associations, such property to be co-mingled with and to become part of the general assets of the Ukrainian National Association, Inc.

8. Nothing contained herein shall affect the property of lodges of the Ukrainian National Association, Inc. and local assemblies of the Ukrainian National Aid Association of America, Inc., which property shall become the property of the Ukrainian National Association lodges as these will now become. Nothing in this Agreement shall preclude any local assembly of the UNAAA to expend funds in accordance with Article XXI of UNAAA's bylaws from the date this Agreement is signed and until the effective date of the Merger.

9. After the execution of this Agreement, neither the Ukrainian National Association, Inc. nor the Ukrainian National Aid Association of America, Inc. will incur any liability or expend or exchange any assets except in the regular and customary course of business.

10. UNA agrees that it will not impose a lien upon any UNAAA policy or certificate in-force on the effective date of the Merger due to any deficiency or impairment that exists on the effective date with UNAAA's reserves as to all or any class of its certificates.

ARTICLE THREE

1. Upon execution of this Agreement, UNAAA shall continue efforts to sell or otherwise dispose of real property it owns at 925 North Western Avenue, Chicago, Illinois, 60622 and shall assign its rights under the contract of purchase and sale to the successor society if the merger shall have been consummated prior to the date of closing, which is presently scheduled for January 30, 1998.

2. Upon execution of this Agreement, each society shall commence appropriate due diligence, shall freely exchange all relevant financial and other information, and shall execute such resolutions and documents as may be required to effectuate such merger.

3. As a condition of, and in consideration of, the furnishing of such information, UNAAA and UNA mutually agree to treat such information in accordance with the provisions of this Agreement and agree to take or refrain from taking other actions as set forth in this Agreement.

4. As a condition to the furnishing such information to the other and permitting each to conduct Due Diligence, each society will hold in a fiduciary capacity for the benefit of the other all confidential and proprietary information obtained during the term of this Agreement. Each agrees that for a period of two years from the date of this Agreement, unless a merger occurs, the authorized Representatives, who are the Executive Committee of each society and the counsel for each who shall come into possession of such confidential and proprietary information, shall not, directly or indirectly, disclose, or communicate to any of its sales personnel or any other person, firm, or corporation, other than to the other party to this Agreement, or persons, firms, partnerships, corporations, designated by the other party to this Agreement, or to the Pennsylvania and/or New Jersey Insurance Department or other Insurance Department personnel when required by law or regulation to do so, any information relating to the business or affairs of the parties to this Agreement which is confidential, proprietary, or not in the public domain. Such nondisclosure shall include applications, rate schedules, rate quotations, underwriting procedures, claim information, lists of policyholders, list of agents and non-public financial analysis or compilations.

5. If the Merger is not consummated pursuant to this Agreement, neither party shall, for a period of two years after the date of this Agreement, directly or indirectly, disclose or use any confidential non-public information, as set forth above, to actively solicit members of the other party, who are not already members of the soliciting party. During the pendency of this transaction, and thereafter only in the event of a non-successful merger, and except as modified by the previous two paragraphs above, each party may continue to compete for members among the Ukrainian American and Slavic American communities, which communities fall within the potential field of membership of each party.

6. If , prior to the time of Merger, any required consent or approval is denied by or is not obtained from the Insurance Commissioners of the State of New Jersey, the Commonwealth of Pennsylvania, or any other Country, State, Province or other jurisdiction, either party either party hereto may terminate this Agreement by giving the other party written notice of the intent to terminate this Agreement. All copies of all confidential material, equipment and data that was or will have been furnished to by UNAAA to UNA, or by UNA to UNAAA together with literature, rate schedules, customer lists, policy forms, filing systems and any other property furnished to the other party to assist it in conducting its due diligence review and analysis of the other party's operations and financial condition shall be and remain the property of the original party and shall be returned by the other party to the original party after the termination of this Agreement unless the Merger is consummated.

7. Each party shall complete its Due Diligence by the 61st day after the date of this Agreement of Merger. On or before such 61st day, either party shall give notice to the other, in writing, of its satisfaction with its Due Diligence and the waiver of the contingency, or of its dissatisfaction with its Due Diligence and its decision to terminate this Agreement of Merger. If either party fails to give such notice on or prior to such 61st day, such party shall be conclusively deemed to be satisfied with its Due Diligence and to have waived this contingency. If both parties' Due Diligence is or is deemed to be satisfied, this Agreement of Merger shall promptly be published or otherwise furnished to all members of each society as required by the laws of the State of New Jersey and Commonwealth of Pennsylvania and thereafter submitted to a vote of their respective membership at a regular or special Convention of each society to be held no later than May 29, 1998, in accordance with their bylaws and law, and as more specifically set forth hereafter, with a recommendation of the General Assembly to approve the merger. The deadlines established under this Agreement may be extended by the mutual written consent of the parties.

8. Each party shall have the right to terminate this Agreement if at the time of the Merger there is a material adverse change in the other party's financial condition from the date of the last financial statements delivered to the party seeking to terminate this Agreement. A material adverse change in a party's financial condition shall mean (I) a reduction of its surplus or (ii) an increase in the deficit in its surplus, as the case may be, of more than $20,000.00. In determining any change in the financial condition of UNAAA at the time of the Merger, any transfer of funds from its surplus to its Foreign Exchange Rate Reserve (the "FER Reserve") shall be disregarded and shall not be included in the determination of its financial condition.

9. UNAAA has disclosed to UNA that its FER Reserve as of December 31, 1995 was understated by $659,816. This was based upon a foreign exchange rate for a Canadian dollar to U.S. dollar of $.7319 to $1.00. UNAAA shall provide to UNA on or before April 1, 1998 an opinion of its actuary as to the amount that should be reserved in the FER Reserve of UNAAA as of December 31, 1997. If the foreign exchange currency rate of the Canadian dollar is equal to or less than $.6800 per U.S. dollar, based upon the foreign exchange rate as reported in the Wall Street Journal, at any time subsequent to the date that this Agreement is signed until the effective date of the Merger, then UNA shall have the right to terminate this Agreement. Failure to receive written notice of UNA's termination of this Agreement under this provision within five business days that said foreign exchange rate was published shall constitute a waiver of UNA's right to terminate under this provision unless the foreign currency exchange rate remains below said level after the fifth business day, at which time UNA will have another five business days to exercise its right to terminate.

10. It is understood and agreed that no failure or delay by either party in exercising any right, power or privilege under this Agreement shall operate as a waiver, nor shall any single or partial exercise preclude any other or further exercise or the exercise of any other right, power or privilege

11. Both parties acknowledge and agree that neither party would have an adequate remedy at law and would be irreparably harmed in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that each shall be entitled to injunctive relief to prevent breaches of this Agreement and to specifically enforce the terms and provisions hereof, in addition to any other remedy to which either may be entitled at law or in equity.

12. Each party shall direct, and cause its Representatives to direct, any and all correspondence and other communications relating to this Merger Agreement with each other only through its officers whose signatures appear below and/or to its respective attorneys.

13. The fees and expenses of each party will be paid by that party in connection with the implementation of this Agreement.

14. This Agreement shall be governed and construed in accordance with the laws of the State of New Jersey, without conflicting in any material way with the requirements of Pennsylvania law for the consummation of a merger between Associations. Venue shall be in the State of New Jersey, in the County of Morris.

ARTICLE FOUR

Each of the Ukrainian National Association, Inc. ("UNA") and Ukrainian National Aid Association of America, Inc., for itself and on its own behalf, separately represents and warrants to the other the following, the truth and accuracy of each of which shall constitute a condition precedent to the obligations of the other hereunder. All representations and warranties shall be true and correct as of the date of this Agreement and as of the Effective Date of the Merger.

Section 4.1 Organization and Standing. It is a Fraternal Benefit Society, duly organized and incorporated, validly existing and in good standing under the laws of the State of New Jersey and of Pennsylvania respectively. It has all requisite corporate power and authority and is duly qualified and licensed to own, lease and operate its properties and to carry on its business as now being conducted.

Section 4.2 Authority for Agreement. It has full and requisite corporate power and authority to execute and deliver this Plan of Merger and, subject to the approval of the New Jersey and Pennsylvania Insurance Departments (the "Departments") and the requisite approval of delegates of a Regular or Special Convention of this Plan of Merger, to consummate the Plan of Merger and to carry out its obligations hereunder. The execution and delivery of this Plan of Merger and the consummation of the transactions contemplated hereunder, has been duly authorized by its General Assembly and/or its Executive Committee as required by its bylaws and this Plan of Merger constitutes a valid and legally binding obligation enforceable in accordance with the terms thereof. The execution and delivery of this Plan of Merger and the consummation of the transactions contemplated hereunder will not conflict with, result in any violation of, or constitute a default under, (i) any provisions of its Charter, Articles of Incorporation or Bylaws , or, (ii) except as previously disclosed in writing, any mortgage, indenture, lease, agreement (including, but not limited to, any agreement with any government agency or instrumentality having jurisdiction over its business or properties) or other instrument, permit, concession, grant, franchise, license, judgment, order, decree, statute, law, ordinance, rule or regulation by which it is or may be bound, or which is applicable to it or any of its properties.

Section 4.4 Financial Statements

(A) It has previously delivered to the other party true and complete copies of (I) annual statements for the years ended December 31, 1996, and December 31, 1995 to UNA and (ii) its unaudited financial statements for the six (6) months ended June 30, 1997, (hereinafter collectively referred to as the " Financial Statements"). It shall also submit to the other party the unaudited 1997 annual statement by March 15, 1998, and all available quarterly statements thereafter, and all representations made as to any financial or annual statements shall apply to these as well.

(B) Each of the Financial Statements is correct and complete in all material respects and was and will be prepared in accordance with statutory accounting principles ("SAP") and presents fairly in all material respects its financial condition, results of operations and changes in its financial position covered thereby as of the dates or for the periods covered thereby, in conformity with SAP. It has previously made available to the other party true and complete financial documents filed with the New Jersey Insurance Department, Pennsylvanian Insurance Department or in any jurisdiction where it is required to make such filings. As of their respective dates, the filings did not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein in light of the circumstances under which they were made, not misleading.

Section 4.5 Reserves. The aggregate actuarial reserves and other actuarial amounts held in connection with its liabilities as established or reflected in its December 31, 1996 Annual Statement and in all other statements to be supplied:

(A) (i) were determined in accordance with generally accepted actuarial standards consistently applied; (ii) were fairly stated in accordance with sound actuarial principles; and (iii) were based on actuarial assumptions;

(B) met the requirements of the applicable insurance laws of the State of New Jersey and Pennsylvania, or any other state or governmental entity having such jurisdiction in all material respects; and

(C) were adequate (under generally accepted actuarial standards consistently applied) to cover the total amount of all reasonably anticipated matured and unmatured liabilities under all outstanding benefit contracts pursuant to which it has any liability.

For purposes of clause [c] above, (i) the adequacy of reserves shall be determined only on the basis of facts and circumstances known or which reasonably should have been known (based on procedures consistently applied by each society in connection with assessing the adequacy of reserves from time to time) by it, as at the date hereof, and (ii) the fact that reserves covered by any such representation may be subsequently adjusted at times and under circumstances consistent with each society's ordinary practice of periodically reassessing the adequacy of its reserves, shall not be used to support any claim regarding the accuracy of such representation.

Section 4.6 No Undisclosed Liabilities. Except as disclosed in the December 31, 1996, or the December 31, 1997 Annual Statement, or any of its most recent unaudited Financial Statements, it had no liabilities (other than liabilities in respect of benefit contracts, payroll, employee benefits and other employee compensation, and with respect to the period from the date of this Plan of Merger through the Effective Date of the Merger, liabilities incurred in each such case during the ordinary course of business, consistent with past practice) that individually exceed Ten Thousand Dollars ($10,000) or in the aggregate exceed Ten Thousand Dollars ($10,0000), except as disclosed in Exhibit 4:6-A, hereto attached.

Section 4.7 Absence of Certain Changes. Since the date of the most recent Financial Statements delivered or to be delivered pursuant to Sections 4.4 and 4.5, and except as set forth in Exhibit 4.7 hereto, it has not:

(A) undergone any material adverse change in its condition (financial or otherwise), properties, assets, liabilities, business or operations, other than changes in the ordinary course of business which have not been materially adverse to it; provided that changes in the economy of the United States of America or its State of Domicile generally or the insurance industry in its State of Domicile (or changes in the financial condition, results of operations or assets of each respective society, taken as a whole, that are caused directly or indirectly, substantially and primarily by such general changes or changes in the State of Domicile economy or in the insurance industry in the said State) shall not be deemed to be material adverse changes for purposes of this Section 4.7(A); and

(B) except as heretofore disclosed to the other in writing, incurred any indebtedness for borrowed money or issued or sold any debt securities or other obligations, or made any commitments with respect to the foregoing, other than in the ordinary course of business and not exceeding $10,000.

Section 4.8 Absence of Undisclosed Liabilities. Except as set forth in Exhibit 4.8 hereto, it has no material liabilities of any nature except: (A) liabilities reflected or reserved against in its Financial Statement; and (B) liabilities incurred by it subsequent to the date of the latest statement of financial condition submitted as a part of the Financial Statements in the ordinary course of business and consistent with past practice. As used in this paragraph, "material" is defined as set forth in Article THREE, paragraph 8, on page 11, above.

Section 4.9 Title to Assets; Leases; Contracts; Environmental; Certain Properties.

(A) Except for (i) liens and encumbrances specifically disclosed in any of its Financial Statements or other schedules hereto; (ii) landlords' or statutory liens or other liens incurred in the ordinary course of business and not securing indebtedness for borrowed money and not yet delinquent, defects and irregularities of title, easements, restrictions; (iii) liens and encumbrances, which are not substantial in amount and do not materially impair the value of any property subject thereto or the use of such property for the purposes of which it is presently used or intended to be used; and (iv) except as provided in Exhibit 4.9-A, it has good and marketable title, free and clear of all security interests, encumbrances, trust agreements, liens, or other adverse claims to all its assets and property, real and personal, reflected in its Financial Statements or acquired thereafter, which includes all property and assets used by it that is material to the conduct of its business, except for assets and property disposed of in the ordinary course of business up to the effective date of the merger.

(B) All material real and personal property owned by it or presently used by it is in an adequate condition (ordinary wear and tear excepted) and is sufficient to carry on its business in the manner conducted currently and in the foreseeable future. None of the properties, buildings, fixtures or equipment owned, leased, occupied or used by it violate or fail to comply in any material respect with any applicable health, fire, safety, zoning, or building laws or ordinances or any restrictive covenant pertaining thereto, provided that such warranty shall not apply to violations or failures in compliance that are cured or corrected as soon as practicable after the day when such violations or failures come to the attention of its management , or are in the process of being so cured and corrected.

(C) Except as disclosed in Exhibit 4.9-C, it has not given, nor has it received, any notice, letter, citation, order, warning, complaint, inquiry, claim or demand that: (i) it has violated, or is about to violate any environmental, health, or safety statute, law, rule, regulation, ordinance, judgment or order, other than a health related statute, law, rule, regulation, ordinance, judgment or order relating to any property owned or operated by it, the violation of which will not have a material adverse effect on its ability to perform its obligations hereunder; (ii) there has been a release, or there is a threat of release, of any hazardous substances (including, without limitation, petroleum, its by-products or derivatives or other hydrocarbons) from its property; (iii) it may be or is liable, in whole or in part, for the costs of cleaning up, remediating or responding to a release of hazardous substances (including, without limitation, petroleum, its by-products or derivatives, or other hydrocarbons); (iv) its property or assets are subject to a lien in favor of any governmental entity for any liability, costs or damages under any environmental law, rule or regulation arising from or costs incurred by such governmental entity in response to the release or storage of a hazardous substance (including, without limitation, petroleum, its by-products or derivatives, or other hydrocarbons). It has not received notice to the effect that its operations are not in compliance with any of the requirements of applicable environmental, health and safety laws (other than health or safety laws and regulations relating to the licensing of its property, the violation of which will not have a material adverse effect on the its ability to perform its obligations hereunder) or are the subject of any governmental investigation evaluating whether any remedial action is needed to respond to the storage or release of any toxic or hazardous waste or substance, which non-compliance or remedial action would have a material adverse effect on its business, operations, properties, assets or condition (financial or otherwise) taken as a whole.

Section 4.10 Insurance. Exhibit 4.10 contains an accurate and complete list and brief description of all policies of insurance, including fidelity and bond insurance. It is not in default with respect to the provisions of any such policy and has not failed to give any notice or present any claim thereunder in a due and timely fashion. All such policies (A) are sufficient for compliance with all requirements of law and all agreements to which it is a party; (B) are valid, outstanding and enforceable; (C) provide adequate insurance coverage for its assets and operations; (D) will not in any significant respect be affected by, and will not terminate or lapse prior to the Effective Date of the Merger; and (E) are presently in full force and effect, and there are no unpaid premiums due thereon.

Section 4.11 Employee Benefit Plans:

(A) It does not maintain, sponsor, contribute to or have any liability under any plan, arrangement or contract providing for any health care benefits, disability benefits, child or dependent care benefits, cafeteria plan benefits, death benefits, accidental death and dismemberment benefits, deferred compensation benefits, incentive compensation payments, pension or other retirement benefits, or severance or termination pay or benefits, except as set forth in Exhibit 4.11-A. The plans set forth in Exhibit 4.11-A are individually referred to as an "Employee Benefit Plan" and collectively referred to as "Employee Benefit Plans";

(B) Its plan administrators have complied in all material respects with the group health plan continuation coverage requirements under the Employee Retirement Income Security Act ("ERISA") and the Internal Revenue Code;

C) All Employee Benefit Plans have been administered in accordance with their respective terms, and no actions, suits or claims (other than routine claims for benefits) are pending or threatened with respect thereto;

(D) Each employee that is or has within the last five (5) years been a member of a controlled group of employers that includes the said society has: (I) made all contributions to pension plans that it is required to make under Section 302 of ERISA for plan years that have ended, and for the current plan years; (ii) never sought a waiver of minimum funding requirements under Section 303 of ERISA; (iii) paid any excise taxes imposed on it under Section 4971 of the Internal Revenue Code; and (iv) never become obligated to pay any withdrawal liability to a multi-employer pension plan under Title IV of ERISA. For purposes of this subsection (D), controlled group means any group treated as a single employer under subsection (b), (c), (m) or (o) of Section 414 of the Internal Revenue Code;

(E) Each Employee Benefit Plan that is intended to be qualified under Section 401 or 403 of the Internal Revenue Code meets all the requirements for qualification;

(F) The assets of each Employee Benefit Plan that is subject to Title IV of ERISA equal or exceed the accumulated benefit obligation with respect thereto; and

(G) Except as described on Exhibit 4.11-A, it has not made any promises or representations concerning continuation of group insurance coverage, partly or wholly at its expense after an employee's employment terminates.

Section 4.12 Tax Matters. It is exempt from United States taxation as a qualified organization under Section 501(c)(8) of the Internal Revenue Code and from Canadian federal and provincial taxation as an equivalent qualified exempt organization. To the best of its knowledge, it has done nothing that could adversely affect its status as a tax-exempt entity and is in full compliance with the Internal Revenue Code and the rules and regulations thereunder and equivalent Canadian federal and provincial rules, regulations and statutes with respect to tax exempt entities.

Section 4.13 Litigation. Except as otherwise disclosed in Exhibit 4.13 hereto, there are no judicial or administrative actions, suits, proceedings or investigations pending or, to its knowledge, threatened, which might result in any materially adverse change in its condition (financial or otherwise), properties, assets, business or operations, or which seek to invalidate or enjoin this Plan of Merger or any action taken or to be taken in connection herewith or therewith.

Section 4.14 Compliance with Laws; Government Authorizations. Except as otherwise described in Exhibit 4.14 hereto, or where non-compliance with the provisions of this Section would not have a materially adverse effect on its business or financial condition it is in compliance, in all material respects, with all applicable Canadian federal and provincial, and United States federal and state, statutes, laws, ordinances, rules, regulations, judgments, orders and decrees which apply to its business or properties. All permits, concessions, grants, franchises, licenses and other governmental authorizations and approvals necessary for the conduct of its business, have been duly obtained and are in full force and effect, and there are no proceedings and investigations pending or, to its knowledge, threatened which may result in the revocation, cancellation or suspension, or any materially adverse modification thereof. The consummation of the transactions contemplated hereunder will not result in any such revocation, cancellation, suspension or modification.

Section 4.15 Full Disclosure. Neither this Plan of Merger and the Exhibits hereto, nor any letter, certificate or other document furnished or to be furnished by it, insofar as it relates to its operations, properties, financial condition or prospects or in any proxy statement, information memorandum, or other document to be used in connection with the transactions contemplated hereunder, or in any of the applications or documents to be filed with governmental agencies in connection with the transactions contemplated hereunder, contains or will contain any untrue statement of a material fact or omits or will omit to state a material fact necessary to make the statement contained herein and therein in light of the circumstances under which they are or have been made, not misleading. There is no fact relating specifically to it or any of its operations, properties, financial condition or prospects known to it which materially adversely affects or, to its knowledge, in the future may materially adversely affect, its condition, properties, assets, liabilities, business or operations, which have not previously been disclosed in writing to the other.

Section 4.16 Public Statements. At all times from the date of this Agreement of Merger up to and including the Effective Date of the Merger, its public statements to its members, with respect to all information set forth therein relating to it and this Agreement of Merger and the contemplated transactions herein and therein will not knowingly contain any statement which, at the time and in light of the circumstances under which it is made, is false or misleading with respect to any material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not false or misleading, or necessary to correct any statement in an earlier communication with respect to the same meeting, convention, or subject matter which has become false or misleading.

ARTICLE FIVE

Section 5.1 Delegate/Member Meetings/Conventions. UNA and UNAAA shall each take all actions necessary, under their respective Bylaws and Articles of Incorporation, to convene a meeting of their respective delegate/members as promptly as may be practicable to vote on the Plan of Merger, but no later than May 29th of 1998, and subject to their fiduciary duties to their respective fraternal benefit societies, the governing bodies of the parties will recommend a vote in favor of the Merger to the delegate/members of their respective fraternal benefit societies and will use their best efforts to solicit such delegate/members to vote in favor of the Merger by no less than a 66.67% vote in favor, and to take all other actions reasonably necessary or advisable to secure the votes of the delegate/members of each fraternal benefit society which may be required in order to approve the respective Merger, including a ballot without a Convention, if permitted by law or by-laws.

Section 5.2 Vote. This Plan of Merger shall be submitted to a vote of the delegate/members of record of each of the parties hereto who are entitled to vote in respect thereof in a manner so as to comply with the requirements of applicable laws.

Section 5.3 Action Following Delegate/Member Approval. If the required votes of each of the parties delegate/members shall be in favor of the Merger, then the proper officers of the fraternal benefit societies shall execute, acknowledge, deliver, file and record all such instruments and certificates as may be required, and shall take any and all other action deemed by them required or proper to obtain the required regulatory approvals to effectuate the Merger and to make the Merger effective according to this plan of Merger and pursuant to the applicable laws of the Commonwealth of Pennsylvania and State of New Jersey.

ARTICLE SIX

The obligations of the parties to complete the transactions contemplated hereunder are subject to the satisfaction, on or before the effective Date of the Merger, of each of the following conditions:

Section 6.1 Approval of the Plan of Merger. All of the following actions shall have been completed in all respects and all in accordance with the applicable provisions of the respective New Jersey and Pennsylvania Fraternal Benefit Societies Codes, and insurance company and business corporation laws (the "Statutes"): (A) this Plan of Merger has been adopted by the applicable governing bodies of the parties and the Merger shall have been approved by the respective parties delegate/members in accordance with the requirements of the Statutes and Bylaws of the parties; and (B) the New Jersey and Pennsylvania Insurance Commissioners shall have given their written approval to the Merger.

Section 6.2 No Adverse Order. No order entered or law promulgated or enacted by any governmental entity shall be in effect which would prevent the consummation of the Merger or other transactions contemplated hereby, and no proceeding brought by a governmental entity shall have been commenced and be pending which seeks to restrain, prevent, or materially delay or restructure the transactions contemplated hereby or which otherwise questions the validity or legality of any such transactions.

Section 6.3 Approvals. All filings and approvals required to be obtained or made prior to the Effective Date of the Merger shall have been or be obtained or made and no required approval shall have been rescinded, adversely modified or limited (as set forth in the proviso below) and, if merely required to be filed, all filings shall have been made and accepted, and all waiting periods prescribed by applicable law shall have expired or have been terminated in accordance with applicable law; provided, however, that such approvals shall not contain any conditions or limitations that compel or seek to compel UNA to dispose of or to hold separately all or any portion of the business or assets of the constituent fraternal benefit societies or impose or seek to impose any limitation on the ability of UNA to conduct its business or own its assets after the Effective Date of the Merger in substantially the same manner as the constituent fraternal benefit societies may presently conduct their business or own their assets.

Section 6.4 No Violation. Consummation of the Merger will not constitute or result in a breach or default under any provision of any charter, bylaw, indenture, mortgage, lease or agreement or any order, judgment, decree, law or regulation to which any property of the parties is subject or by which the parties are bound, except for breaches or defaults which in the aggregate would not have materially adverse effect on properties, business, operations or consolidated financial condition of UNA or UNAAA taken as a whole.

Section 6.5 Compliance with Law. To the best of their knowledge, the parties shall not be in violation in any material respect (or, with notice or lapse of time or both, would be in violation in any material respect) of any term or provision of any applicable law in a manner which would materially and adversely affect or would be reasonably likely to materially and adversely affect the business or consolidated financial condition of UNA or UNAAA taken as a whole.

ARTICLE SEVEN

In addition to the conditions precedent contained in Article Four of this Plan of Merger, each society's obligation to consummate the Plan of Merger shall be further subject to fulfillment on or before the Effective Date of the Merger of each of the following conditions, unless waived in writing by the other.

Section 7.1 Representations and Warranties. The representations and warranties of each society set forth hereinabove, respectively, shall be true and correct in all material respects at the Effective Date of the Merger as though made at and as of that time, except as affected by transactions contemplated or permitted hereby.

Section 7.2 Covenants. UNA and UNAAA shall have performed and complied in all material respects with its obligations and agreements required by this Agreement to be performed by it on or before the Effective Date of the Merger.

Section 7.3 Consents. UNA and UNAAA shall obtain all consents of and make all filings with any persons as is or may be required with respect to it in connection with the execution and delivery of this Plan of Merger and the consummation of the transactions contemplated hereby, except for any consent or filing for which the failure to obtain or to make would not (A) cause to be in violation of any term or provision of material law applicable to it or any of its assets, or (B) individually, in the aggregate, have a materially adverse effect.

Section 7.4 Litigation. There shall be no proceedings pending or any proceedings or investigations (other than claims in the ordinary course of the insurance or other business of UNA or of the UNAAA), threatened against, relating to, involving or otherwise affecting it which, individually or in the aggregate, may reasonably be expected to have a material adverse affect on the business or consolidated financial condition of UNA or of UNAAA, taken as a whole.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective presidents, attested to by their respective secretaries, and their respective corporate seals to be affixed thereto on the day and year first above written.

UKRAINIAN NATIONAL ASSOCIATION, INC.
Attested to:
By:   ULANA M. DIACHUK, President
         MARTHA LYSKO, Secretary

UKRAINIAN NATIONAL AID ASSOCIATION of AMERICA, INC.
Attested to:
By: WOLODYMYR OKIPNIUK, Acting President
         ODARKA ROBERTS, Secretary