Financing:
Pursuant to the merger agreement, Alfa Corp. will fund approximately $471 million of the total merger consideration and associated fees and expenses. The Mutual Group will provide the remainder of the required funds, with AMI providing approximately $127 million and AMF providing approximately $275 million. The amount that each of AMI and AMF is paying is proportionate to its ownership percentage of Merger Sub. AMI owns 23% of the outstanding common stock of Merger Sub, and AMF owns the remaining 77%. These percentages were determined so that the shares of Alfa Corp. common stock acquired by each of AMI and AMF in the merger, when added to its existing holdings of Alfa Corp. stock, will result in AMI owning 65% of Alfa Corp. and AMF owning 35% of Alfa Corp. immediately after the effective time of the merger.

Funding by Alfa Corp.
Subject to receipt of applicable regulatory approvals, Alfa Corp. intends to obtain its approximate $471 million portion of the aggregate merger consideration and associated fees and expenses by using an aggregate of approximately $411 million in cash dividends received from certain of its subsidiaries, and approximately $60 million in proceeds from borrowing under its existing commercial paper facility.

On April 15, 2008, Alfa Corp. filed a Certificate of Merger with the Secretary of State of the State of Delaware, pursuant to which Merger Sub, an entity organized by the Mutual Group solely for the purpose of acquiring all of the outstanding shares of Alfa Corp.’s common stock not already owned by the Mutual Group, was merged with and into Alfa Corp., with Alfa Corp. continuing as the surviving corporation (the “Merger”). As a result of the Merger, Alfa Corp. became a wholly owned subsidiary of the Mutual Group. Under the terms of the Merger Agreement, each share of Alfa Corp. common stock, par value $1.00 per share, outstanding at the effective time of the Merger (other than shares owned by the Mutual Group, Merger Sub, Alfa Corp. and its wholly owned subsidiaries, holders of shares subject to certain company awards, and holders who have perfected and not withdrawn a demand for appraisal rights) was cancelled and converted into the right to receive $22.00 in cash, without interest.