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
October 15, 2009 (October 9, 2009)
Date of Report (Date of earliest event reported)
Protective Life Insurance Company
(Exact name of registrant as specified in its charter)
Tennessee |
| 001-31901 |
| 63-0169720 |
(State or other jurisdiction |
| (Commission |
| (IRS Employer |
of incorporation) |
| File Number) |
| Identification No.) |
2801 Highway 280 South
Birmingham, Alabama 35223
(Address of principal executive offices and zip code)
(205) 268-1000
(Registrant’s 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 CFR 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 1.01 Entry into a Material Definitive Agreement
On October 9, 2009, Golden Gate Captive Insurance Company (“Golden Gate”), a wholly-owned subsidiary of Protective Life Insurance Company (the “Company”), entered into a Surplus Note Purchase Agreement, dated as of October 9, 2009 (the “Surplus Note Purchase Agreement”), with Long Island International Limited (“Long Island International”), pursuant to which Golden Gate purchased from Long Island International $450 million in aggregate principal amount of Golden Gate’s outstanding Series A Floating Rate Surplus Notes due 2037 (“Series A Surplus Notes”). On October 15, 2009, Golden Gate also entered into a Note Sale Agreement, dated as of October 15, 2009 (the “Note Sale Agreement”), with Dr. Michael Frege, in his capacity as insolvency administrator of Lehman Brothers Bankhaus AG (“Lehman Bankhaus”), pursuant to which Golden Gate purchased from Lehman Bankhaus $350 million in aggregate principal amount of Golden Gate’s outstanding Series A Surplus Notes. The $800 million in aggregate principal amount of Series A Surplus Notes were repurchased from Long Island International and Lehman Bankhaus for an aggregate purchase price of $667 million plus accrued and unpaid interest. The repurchase transactions are expected to result in an estimated pre-tax gain for the Company of $126 million (after the Company’s write-off of the unamortized issuance expenses of approximately $7 million associated with the original issuance of the repurchased Series A Surplus Notes), to be recognized by the Company in the fourth quarter of 2009. Golden Gate reinsures certain policy liabilities of the Company and its subsidiary, primarily related to level premium term life products.
Golden Gate repurchased the Series A Surplus Notes from Long Island International and Lehman Bankhaus with the proceeds from Golden Gate’s sale to Protective Life Corporation (“PLC”) of $800 million aggregate principal amount of newly issued surplus notes. Golden Gate has cancelled the repurchased Series A Surplus Notes. As a result of these repurchase transactions, PLC is the sole holder of Golden Gate’s outstanding surplus notes. Golden Gate intends to pay to the Company a dividend in the amount of $133 million, which represents the difference between the $800 million in proceeds received by Golden Gate from its sale of the newly issued surplus notes to PLC and the $667 million aggregate purchase price paid by Golden Gate to repurchase the Series A Surplus Notes.
Long Island International is an affiliate of Barclays Bank PLC, Barclays Capital Inc. and Barclays Global Investors, NA. Barclays Bank PLC is one of the lenders under, and is a co-documentation agent with respect to, PLC’s $500 million credit facility. Barclays Capital Inc. served as an underwriter in PLC’s registered offerings of 7.375% senior notes due 2019, 8.450% senior notes due 2039 and 8.00% senior notes due 2024. Additionally, based on a Schedule 13G filed with the SEC on February 5, 2009, as of December 31, 2008, Barclays Global Investors, NA and its affiliates may be deemed the beneficial owner of 4,808,986 shares of PLC’s common stock, constituting approximately 6.87% of PLC’s outstanding common stock on such date.
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SIGNATURE
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 hereunto duly authorized.
| PROTECTIVE LIFE INSURANCE COMPANY |
| /s/Steven G. Walker |
| Steven G. Walker |
| Senior Vice President, Controller and Chief Accounting Officer |
Dated: October 15, 2009
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