United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 28, 2002
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Commission file number 1-11983
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FPIC Insurance Group, Inc.
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(Exact name of registrant as specified in its charter)
Florida 59-3359111
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(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
225 Water Street, Suite 1400, Jacksonville, Florida 32202
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(Address of principal executive offices) (Zip Code)
(904) 354-2482
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(Registrant's telephone number, including area code)
Item 7. Financial Statements and Exhibits.
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(c) Exhibits
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Exhibit Number Description of Exhibits
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10(oo) Forbearance of covenant violation dated
October 24, 2002 on behalf of FPIC
Insurance Group, Inc. pursuant to the
terms and conditions of Section 5.12 of
the Revolving Credit and Term Loan
Agreement dated as of August 31, 2001 by
and among FPIC Insurance Group, Inc., as
Borrower, and several banks and
financial institutions, as Lenders, as
amended by Amendment No. 1 dated as of
March 25, 2002.
99 FPIC Insurance Group, Inc. Press Release
dated October 23, 2002
Item 9. Regulation FD Disclosure.
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On October 23, 2002, the group rating of FPIC Insurance Group, Inc.'s (the
"Company's") four insurance subsidiaries was changed by A. M. Best Company
("Best") from A- (Excellent) with a negative outlook to B++ (Very Good) with a
stable outlook. Based on Best's published rating guidelines, a Best rating of
B++ (Very Good) is a "Secure" rating assigned to companies that have, on
balance, very good balance sheet strength, operating performance and business
profile, when compared to standards established by Best.
As a result of the Company's rating change and pursuant to the terms and
conditions of the Company's Revolving Credit and Term Loan Agreement dated as of
August 31, 2001, by and among the Company and several banks and financial
institutions (the "Lenders"), as amended by Amendment No. 1 dated as of March
25, 2002 (the "Loan Agreement'), the Company is in non-compliance with Section
5.12 of the Loan Agreement, requiring First Professionals Insurance Company,
Inc. ("First Professionals"), the Company's largest insurance subsidiary, to be
rated A- or higher, itself, or as a part of an insurance company group so rated
by Best.
As a result of such non-compliance, the Company requested and received from its
Lenders a forbearance dated October 24, 2002 (the "Forbearance) under which the
Lenders have agreed to forbear taking any action with regard to this covenant
violation for a 30-day period, until November 23, 2002, to allow adequate time
for the Company and its Lenders to agree upon and finalize appropriate revisions
to the Loan Agreement. For additional information regarding the terms and
conditions of the Forbearance, see Exhibit 10(oo) attached to this Form 8-K.
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Safe Harbor Disclosure for Forward-Looking Statements.
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The Private Securities Litigation Reform Act of 1995 provides a "safe harbor"
for forward-looking statements. Any written or oral statements made by or on
behalf of the Company may include forward-looking statements, which reflect the
Company's current views with respect to future events and financial performance.
These forward-looking statements are subject to certain uncertainties and other
factors that could cause actual results to differ materially from such
statements. These uncertainties and other factors include, but are not limited
to, (i) uncertainties relating to government and regulatory policies (such as
subjecting the Company to insurance regulation or taxation in additional
jurisdictions or amending, revoking or enacting any laws, regulations or
treaties affecting the Company's current operations), (ii) the occurrence of
insured or reinsured events with a frequency or severity exceeding the Company's
estimates, (iii) legal developments, including claims for extra-contractual
obligations or in excess of policy limits in connection with the administration
of insurance claims, (iv) the uncertainties of the loss reserving process, (v)
the actual amount of new and renewal business and market acceptance of expansion
plans, (vi) the loss of the services of any of the Company's executive officers,
(vii) changing rates of inflation and other economic conditions, (viii) the
ability to collect reinsurance recoverables, (ix) the competitive environment in
which the Company operates, related trends and associated pricing pressures and
developments, (x) the impact of mergers and acquisitions, including the ability
to successfully integrate acquired businesses and achieve cost savings,
competing demands for the Company's capital and the risk of undisclosed
liabilities, (xi) developments in global financial markets that could affect the
Company's investment portfolio and financing plans, (xii) risk factors
associated with financing and refinancing, including the willingness of credit
institutions to provide financing and the availability of credit generally,
(xiii) developments in reinsurance markets that could affect the Company's
reinsurance program; and (xiv) changes in the Company's financial ratings
resulting from one or more of these uncertainties and other factors.
The words "believe," "anticipate," "foresee," "estimate," "project," "plan,"
"expect," "intend," "hope," "should," "will," "will likely result" or "will
continue" and variations thereof or similar expressions identify forward-looking
statements. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of their dates. The Company
undertakes no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.
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Signature
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Pursuant to the requirements of Section 13 or 15(d) 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.
FPIC INSURANCE GROUP, INC.
Date: October 29, 2002 By: /s/ John R. Byers
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John R. Byers
President and Chief Executive
Officer
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EXHIBIT INDEX
Exhibit Number Description of Exhibits
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10(oo) Forbearance of covenant violation dated
October 24, 2002 on behalf of FPIC
Insurance Group, Inc. pursuant to the
terms and conditions of Section 5.12 of
the Revolving Credit and Term Loan
Agreement dated as of August 31, 2001 by
and among FPIC Insurance Group, Inc., as
Borrower, and several banks and
financial institutions, as Lenders, as
amended by Amendment No. 1 dated as of
March 25, 2002.
99 FPIC Insurance Group, Inc. Press Release
dated October 23, 2002