| Item 1.01 | Entry into a Material Definitive Agreement. |
On November 19, 2021, Primerica, Inc. (the “Company”) completed the sale of $600 million in aggregate principal amount of the Company’s 2.800% Senior Notes due 2031 (the “Notes”). The Notes were offered and sold pursuant to the Company’s shelf Registration Statement on Form S-3ASR (File No. 333-230004), which was filed with the Securities and Exchange Commission (the “SEC”) on March 1, 2019, and the Company’s prospectus supplement dated November 16, 2021, as filed with the SEC.
(a) Underwriting Agreement
On November 16, 2021, the Company entered into an Underwriting Agreement (the “Underwriting Agreement”) with Wells Fargo Securities, LLC, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC, as representatives of the several underwriters named in Schedule II to the Underwriting Agreement (collectively, the “Underwriters”), relating to the underwritten public offering of the Notes. Under the terms of the Underwriting Agreement, the Company has agreed to indemnify the Underwriters against various liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”), or to contribute to payments the Underwriters may be required to make in respect of such liabilities. In addition, the Underwriting Agreement contains customary representations, warranties and agreements of the Company.
The estimated net proceeds from the offering of the Notes, after deducting expenses and the underwriting discount, will be approximately $591,997,729. The Company intends to use the net proceeds from the offering of the Notes: (i) to redeem its 4.750% unsecured senior notes due July 15, 2022 (the “2022 Notes”), of which $375.0 million aggregate principal amount was outstanding at September 30, 2021; (ii) to repay approximately $125.0 million of borrowings outstanding under the Company’s revolving credit facility as of September 30, 2021; and (iii) to the extent of any remaining proceeds, for general corporate purposes, which may include share repurchases.
Certain of the underwriters or their affiliates may be holders of a portion of the 2022 Notes. In addition, Wells Fargo Securities, LLC serves as the sole lead arranger and sole bookrunner, and an affiliate of Wells Fargo Securities, LLC serves as the administrative agent and a lender, under the Company’s revolving credit facility.
The foregoing description of the Underwriting Agreement is qualified in its entirety by reference to the Underwriting Agreement, which is filed hereto as Exhibit 1.1 and incorporated herein by reference.
(b) Indenture and Second Supplemental Indenture
The Notes were issued pursuant to an Indenture, dated as of July 16, 2012 (the “Base Indenture”), as supplemented by the Second Supplemental Indenture thereto, dated as of November 19, 2021 (the “Second Supplemental Indenture” and, together with the Base Indenture, the “Indenture”), between the Company and Computershare Trust Company, N.A., as successor to Wells Fargo Bank, National Association, as trustee.
The Notes bear interest at a rate of 2.800% per annum, payable semi-annually in arrears on May 19 and November 19, commencing on May 19, 2022. The Notes mature on November 19, 2031. The Notes will be the Company’s direct, senior unsecured and unsubordinated obligations, ranking equally in right of payment with all of the Company’s existing and future unsecured and unsubordinated indebtedness and will rank senior in right of payment to all of the Company’s future subordinated indebtedness. The Notes will be effectively junior to any secured indebtedness to the extent of the value of the assets securing such indebtedness. The Notes will also be effectively junior to all of the liabilities of the Company’s subsidiaries.
Prior to August 19, 2031 (the date that is three months prior to the maturity date, the “Par Call Date”), we may, at our option, redeem some or all of the Notes at any time and from time to time at a redemption price equal to the greater of: (i) 100% of the principal amount of the Notes to be redeemed; and (ii) the sum of the present values of the remaining scheduled payments of principal and interest on the Notes to be redeemed (exclusive of interest accrued to the date of redemption and assuming that the Notes matured on the Par Call Date), discounted to the redemption date on a semiannual basis at the Treasury Rate (as defined in the Indenture) plus 20 basis points, plus, in each case, accrued and unpaid interest thereon to the date of redemption.
