- Current report filing (8-K)
April 29 2010 - 12:28PM
Edgar (US Regulatory)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
April 29, 2010 (April 23, 2010)
Date of Report
(Date of earliest event reported)
Protective Life Corporation
(Exact name of
registrant as specified in its charter)
Delaware
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001-11339
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95-2492236
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(State or other
jurisdiction
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(Commission
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(IRS Employer
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of
incorporation)
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File Number)
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Identification
No.)
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2801 Highway 280 South
Birmingham, Alabama 35223
(Address of
principal executive offices and zip code)
(205) 268-1000
(Registrants
telephone number, including area code)
N/A
(Former name or
former address, if changed since last report.)
Check the appropriate box
below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (
see
General Instruction A.2. below):
o
Written communications pursuant to Rule 425 under
the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under
the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under
the Exchange Act (17 CF 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17 CFR 240.13e-4(c))
Item
2.03
Creation of a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement of a Registrant.
On
April 23, 2010, Golden Gate III Vermont Captive Insurance Company (GG III),
a newly formed, indirect wholly-owned subsidiary of Protective Life Corporation
(PLC), entered into a Reimbursement Agreement (the Reimbursement Agreement)
with UBS AG, Stamford Branch, as issuing lender (UBS). Under the Reimbursement Agreement, on April 23,
2010, UBS issued a letter of credit (the LOC) in the initial amount of $505
million to a trust for the benefit of PLCs indirect wholly-owned subsidiary,
West Coast Life Insurance Company (WCL).
Subject to certain conditions, the amount of the LOC will be
periodically increased up to a maximum of $610 million in 2013. The term of the LOC is expected to be eight
years, subject to certain conditions including capital contributions made to GG
III by one of its affiliates. The LOC
was issued to support certain obligations of GG III to WCL for a portion of
reserves related to level premium term life insurance policies reinsured by GG
III from WCL under an indemnity reinsurance agreement effective April 1,
2010. These policies were originally
ceded by WCL to Golden Gate Captive Insurance Company, an indirect wholly-owned
subsidiary of PLC, and were recaptured by WCL and ceded to GG III concurrent
with this transaction. The estimated
average annual expense of the LOC under generally accepted accounting
principles is approximately $11 million, after-tax.
Pursuant
to the terms of the Reimbursement Agreement, in the event amounts are drawn
under the LOC by the trustee on behalf of WCL, GG III will be obligated,
subject to certain conditions, to reimburse UBS for the amount of any draw and
any interest thereon. The Reimbursement
Agreement is non-recourse to PLC, Protective Life Insurance Company (PLICO)
and WCL, meaning that none of these companies are liable to reimburse UBS for
any drawn amounts or interest thereon.
Pursuant to the terms of a letter agreement with UBS, PLC has agreed to
guarantee the payment of fees to UBS under the Reimbursement Agreement. Pursuant to the Reimbursement Agreement, GG
III has collateralized its obligations to UBS by granting UBS a security
interest in its assets.
Item
8.01
Other Events.
On
April 28, 2010, Golden Gate Captive Insurance Company (GG), a South
Carolina special purpose financial captive and wholly-owned subsidiary of
PLICO, redeemed $180 million of Series B Surplus Notes held by PLC. On April 29, 2010, PLC used the proceeds
of this redemption to repay $180 million of the outstanding balance on its
revolving line of credit facility (the Credit Facility), resulting in an
outstanding balance of $80 million under the Credit Facility on such date. In addition, on April 27, 2010, GGs
Board of Directors authorized the payment of a dividend in the amount of $250
million to PLICO to be paid in one or more payments on or after April 27,
2010.
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SIGNATURES
Pursuant to the
requirements of the Securities Exchange Act of 1934, the Registrant has duly
caused this report to be signed on its behalf by the undersigned thereunto duly
authorized.
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PROTECTIVE LIFE
CORPORATION
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/s/Steven G. Walker
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Steven G. Walker
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Senior Vice President,
Controller
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and Chief Accounting
Officer
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Dated: April 29,
2010
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