<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
AMENDMENT NO. 1 TO
SCHEDULE 14D-1
TENDER OFFER STATEMENT PURSUANT
TO SECTION 14(d)(1) OF THE SECURITIES EXCHANGE ACT OF 1934
United Home Life Insurance Company
----------------------------------
(Name of Subject Company)
SouthCap Corporation
--------------------
(Bidder)
Common Stock, $1.00 par value per share
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(Title of Class of Securities)
910603-10-9
-----------
(CUSIP Number of Class of Securities)
F. W. Lazenby
Chairman, President and Chief Executive Officer
SouthCap Corporation
211 Seventh Avenue North, 4th Floor
Nashville, Tennessee 37219
(615) 244-1908
--------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications on Behalf of Bidder)
-------------------------------
Copy to:
Donald I. N. McKenzie
Sherrard & Roe, PLC
424 Church Street Suite 2000
Nashville, Tennessee 37219
(615) 742-4200
-------------------------------
<PAGE> 2
SouthCap Corporation, a Tennessee corporation ("Purchaser"), hereby amends and
supplements, as set forth below, its Tender Offer Statement on Schedule 14D-1
(the "Statement") originally filed on April 8, 1997. The Statement relates to
Purchaser's offer to purchase all of the outstanding shares of common stock, par
value $1.00 per share (the "Shares"), of United Home Life Insurance Company, an
Indiana insurance company (the "Company"), at a price of $4.50 per Share (which
is hereby increased to $7.00 per share), payable to the seller in cash promptly
following completion of the Offer, without interest thereon upon the terms and
subject to the conditions set forth in Purchaser's Offer to Purchase dated April
8, 1997 (the "Offer to Purchase") and in the related Letter of Transmittal
(which together constituted the "Offer"), copies of which were previously filed
as Exhibits (a) (1) and (a) (2), respectively. In connection with this Amendment
No. 1 to Schedule 14D-1, Purchaser is filing a Supplement and Amendment to the
Offer to Purchase dated May 12, 1997, attached hereto as Exhibit (a)(1) (the
"Supplement"). The Offer to Purchase, the Supplement, and the related Letter of
Transmittal collectively constitute the Offer. Unless otherwise indicated
herein, each capitalized term used and not defined herein shall have the meaning
assigned to such term in the Supplement or in the Offer to Purchase.
ITEM 1. SECURITY AND SUBJECT COMPANY.
(b) The information set forth in the Introduction and Section 1
("Terms of Offer; Expiration Date") of the Supplement and the Press
Release, dated May 12, 1997, filed hereto as Exhibit (a) (5) is
incorporated herein by reference.
ITEM 3. PAST CONTRACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY.
(b) The information set forth in Section 10 ("Background of Offer to
Purchase") of the Supplement is incorporated herein by reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) - (c) The information set forth in Section 9 ("Source and Amount of
Funds") of the Supplement is incorporated herein by reference.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER.
(c) and (e) The information set forth in Section 11 ("Purpose of the
Offer and Tender; Plans of the Purchaser") of the Supplement is
incorporated herein by reference.
ITEM 10. ADDITIONAL INFORMATION.
(b) The information set forth in Section 14 ("Certain Legal Matters") of
the Supplement is incorporated herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a) (1) Supplement and Amendment to Offer to Purchase dated May 12, 1997.
(a) (5) Press Release issued by SouthCap Corporation on May 12, 1997.
(b) Commitment Letter from SunTrust Bank, N.A. dated May 12, 1997.
Page 1 of 3
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SIGNATURE.
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
Dated: May 12, 1997 SOUTHCAP CORPORATION
By: /s/ F. W. Lazenby
---------------------------------
F.W. Lazenby, Chairman, President
and Chief Executive Officer
Page 2 of 3
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EXHIBIT INDEX
<TABLE>
<CAPTION>
PAGE IN
SEQUENTIAL
EXHIBIT NUMBERING
NUMBER DESCRIPTION OF EXHIBITS SYSTEM
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(a) (1) Supplement and Amendment to Offer to Purchase dated May 12, 1997.................... 5
(a) (5) Press Release issued by SouthCap Corporation on May 12, 1997........................ 10
(b) Commitment Letter from SunTrust Bank, N.A. dated May 12, 1997....................... 11
</TABLE>
Page 3 of 3
<PAGE> 1
Exhibit (a)(1)
Supplement and Amendment to
Offer to Purchase for Cash
All Outstanding Shares of Common Stock
of
UNITED HOME LIFE INSURANCE COMPANY
at
$ 7.00 PER SHARE
by
SOUTHCAP CORPORATION
- --------------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., INDIANAPOLIS,
INDIANA, TIME ON TUESDAY, MAY 27, 1997, UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
* * *
- --------------------------------------------------------------------------------
PLEASE NOTE THAT THE AMOUNT OFFERED PER SHARE HAS BEEN INCREASED
TO $7.00 FROM $4.50. CERTAIN ADDITIONAL AND REVISED DISCLOSURES
ARE ALSO SET FORTH HEREIN.
- --------------------------------------------------------------------------------
THIS OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER, THE NUMBER OF
SHARES WHICH TOGETHER WITH THE SHARES CURRENTLY OWNED BY SOUTHCAP, REPRESENTS AT
LEAST 40% OF THE OUTSTANDING SHARES OF COMMON STOCK OF UNITED HOME LIFE
INSURANCE COMPANY.
---------------------------------
SOUTHCAP HAS REQUESTED THAT THE BOARD OF DIRECTORS OF UNITED HOME LIFE
INSURANCE RECOMMEND THAT SHAREHOLDERS ACCEPT THIS REVISED OFFER. AS OF THE DATE
HEREOF, SOUTHCAP HAS NOT BEEN ADVISED THAT THE BOARD OF DIRECTORS OF UNITED HOME
LIFE INSURANCE COMPANY HAS ACTED WITH RESPECT TO THE INCREASED OFFER.
IMPORTANT
ANY HOLDER OF SHARES OF COMMON STOCK OF UNITED HOME LIFE INSURANCE COMPANY
(THE "SHARES") DESIRING TO TENDER ALL OR ANY PORTION OF HIS OR HER SHARES SHOULD
EITHER: (1) COMPLETE AND SIGN THE LETTER OF TRANSMITTAL (OR FACSIMILE THEREOF)
IN ACCORDANCE WITH THE INSTRUCTIONS IN THE LETTER OF TRANSMITTAL AND MAIL OR
DELIVER THE LETTER OF TRANSMITTAL, THE CERTIFICATES FOR THE SHARES TENDERED, AND
ANY OTHER REQUIRED DOCUMENTS TO THE DEPOSITARY; OR (2) REQUEST HIS OR HER BROKER
OR OTHER INVESTMENT PROFESSIONAL TO EFFECT THE TRANSACTION FOR HIM OR HER. IF
ANY SHARES ARE REGISTERED IN THE NAME OF A BROKER OR INVESTMENT PROFESSIONAL,
THEN A SHAREHOLDER MUST CONTACT SUCH ENTITY IN ORDER TO TENDER ANY SHARES.
A SHAREHOLDER WHO DESIRES TO TENDER SHARES AND WHOSE CERTIFICATES ARE NOT
IMMEDIATELY AVAILABLE, OR WHO IS UNABLE TO DELIVER ALL DOCUMENTS REQUIRED BY THE
LETTER OF TRANSMITTAL TO THE DEPOSITARY PRIOR TO THE EXPIRATION OF THE OFFER,
MAY TENDER SUCH SHARES BY FOLLOWING THE PROCEDURE FOR GUARANTEED DELIVERY SET
FORTH IN SECTION 3 HEREOF.
QUESTIONS AND REQUESTS FOR ASSISTANCE MAY BE DIRECTED TO THE INFORMATION
AGENT, D.F. KING & CO., INC., AT ITS ADDRESS AND TELEPHONE NUMBERS SET FORTH ON
THE LAST PAGE OF THIS OFFER TO PURCHASE. ADDITIONAL COPIES OF THIS SUPPLEMENT
AND AMENDMENT, THE OFFER TO PURCHASE AND THE LETTER OF TRANSMITTAL MAY BE
OBTAINED FROM THE INFORMATION AGENT.
---------------------------------
May 12, 1997
<PAGE> 2
TO THE HOLDERS OF THE COMMON STOCK
OF UNITED HOME LIFE INSURANCE COMPANY
INTRODUCTION
SouthCap Corporation, a Tennessee corporation ("SouthCap" or the
"Purchaser"), hereby offers to purchase all outstanding shares of common stock,
par value $1.00 per share (the "Shares"), of United Home Life Insurance Company,
an Indiana life insurance company (the "Company"), at a price of $7.00 per
share, payable in cash, without interest thereon. SouthCap, by its Offer to
Purchase, dated April 8, 1997 (the "Offer to Purchase"), and a related Letter of
Transmittal previously offered to purchase all Shares at a price of $4.50 per
share. This Supplement and Amendment to the Offer to Purchase (the "Supplement")
is being provided to the shareholders of the Company to increase the offering
price, to reduce the Minimum Condition from 50.1% to 40%, to amend certain
information in the Offer to Purchase, to clarify certain information contained
in the Offer to Purchase, and to provide certain supplemental information. The
Sections of this Supplement correspond to the Sections of the Offer to Purchase
to which the supplemental and clarifying information relates. As a result of
this Supplement, the Expiration Date has been extended to 5:00 p.m.
Indianapolis, Indiana, time on Tuesday, May 27, 1997. This Supplement should be
read in conjunction with the Offer to Purchase and the Letter of Transmittal;
the Offer to Purchase, this Supplement, and the Letter of Transmittal
collectively constitute the "Offer" of SouthCap. All capitalized terms used and
not defined in this Supplement shall have the meanings assigned in the Offer to
Purchase.
Your attention is invited to the following:
1. The tender price is $7.00 per Share, payable in cash, without interest
thereon.
2. The Offer is being made for all outstanding Shares, subject only to
certain conditions set forth in Section 12 of the Offer to Purchase, which
include, among other things, there being validly tendered and not withdrawn
prior to the expiration of the Offer to Purchase a number of Shares which,
together with any Shares then owned by the Purchaser, represents at least 40% of
the outstanding Shares on a fully diluted basis (the "Minimum Condition"). The
Minimum Condition has been reduced from 50.1% to 40% by this Supplement.
3. The Offer to Purchase and withdrawal rights will expire at 5:00 p.m.,
Indianapolis, Indiana, time, on Tuesday, May 27, 1997, unless the Offer is
extended.
If you wish to tender any Shares in accordance with the terms of the Offer,
you must comply with the instructions set forth in this Offer to Purchase and
the Letter of Transmittal. The offer is made solely by this Supplement, the
Offer to Purchase, and the related Letter of Transmittal and is being made to
all holders of Shares.
SOUTHCAP HAS REQUESTED THAT THE BOARD OF DIRECTORS OF THE COMPANY RECOMMEND
THAT SHAREHOLDERS ACCEPT THIS REVISED OFFER. AS OF THE DATE HEREOF, SOUTHCAP HAS
NOT BEEN ADVISED THAT THE BOARD OF DIRECTORS OF THE COMPANY HAS ACTED WITH
RESPECT TO THE INCREASED OFFER.
The Board of Directors of the Company, on April 22, 1997, previously
recommended that shareholders reject SouthCap's initial offer of $4.50 per share
and delivered its recommendation on Solicitation/Recommendation Statement on
Schedule 14D-9.
1
<PAGE> 3
THIS SUPPLEMENT, THE OFFER TO PURCHASE, AND THE RELATED LETTER OF
TRANSMITTAL CONTAIN IMPORTANT INFORMATION WHICH SHOULD BE READ BEFORE ANY
DECISION IS MADE WITH RESPECT TO THE OFFER.
1. TERMS OF OFFER; EXPIRATION DATE
Upon the terms and subject to the conditions of the Offer, SouthCap will
accept for payment and pay for all Shares validly tendered prior to the
Expiration Date and not withdrawn in accordance with Section 4 of the Offer to
Purchase. The term "Expiration Date" means 5:00 p.m. Indianapolis, Indiana time
on May 27, 1997, unless the Purchaser, in its sole discretion, shall have
extended the time during which this Offer is open, in which event the term
"Expiration Date" shall mean the latest time and date at which the Offer, as so
extended by the Purchaser, shall expire.
The Offer is conditioned upon, among other things, the valid tender, without
withdrawal prior to the expiration of the Offer to Purchase, of that number of
Shares which, together with Shares then owned by Purchaser, represents at least
40% of the outstanding Shares on a fully diluted basis (the "Revised Minimum
Condition"). For a description of other conditions to the Offer, see Section 12
of the Offer to Purchase.
9. SOURCE AND AMOUNT OF FUNDS
Based upon (i) 1,209,298 Shares reported to be outstanding at December 31,
1996 (derived from the 1996 annual statement of the Company filed with the
Indiana Department), and (ii) Purchaser's current ownership of 44,352 shares,
the aggregate purchase price for all such Shares which could be bought in the
Offer would be $8,154,622. In addition to cash, cash equivalents, and marketable
securities equaling approximately $5.5 million, the Purchaser has a commitment
from SunTrust Bank, N.A. to provide a $6 million loan to SouthCap to finance the
purchase of the Shares. The material provisions of the financing anticipated by
the commitment are (i) a term of three years, during which SouthCap will pay
interest only, at the lender's prime rate, and (ii) an assignment of a security
interest in certain assets of SouthCap, including the stock of its subsidiary,
Premier Life Insurance Company, and $2 million of marketable securities of
SouthCap. SouthCap intends to repay the loan from funds generated through
operations of the Company, or possibly from proceeds generated from the sale of
Premier Life Insurance Company.
10. BACKGROUND OF THE OFFER TO PURCHASE
On May 8, 1997, Mr. Lazenby, Chairman, President and Chief Executive
Officer of SouthCap, and SouthCap's counsel, met with Mr. Michael A. Schoettle,
Chairman of the Board, President and Chief Operating Officer of the Company,
along with the Company's legal and financial representatives at the offices of
counsel to the Company in Indianapolis, Indiana, for the purpose of presenting
the revised offer of $7.00 per share. SouthCap requested that Mr. Schoettle
deliver the offer to the Board of Directors and that the Company and its Board
of Directors recommend endorsement of the revised offer of $7.00 per share. At
that time, after discussions between the parties and their representatives, Mr.
Schoettle agreed to deliver the revised proposal of SouthCap to the Board of
Directors of the Company. At this time, the Board of Directors of the Company
has not responded to the revised offer.
11. PURPOSE OF THE OFFER AND TENDER; PLANS OF THE PURCHASER
In the event that the Purchaser acquires less than a majority of the
outstanding Shares of the Company as a result of the Offer, the Purchaser shall
exercise its voting rights in an effort to direct management of the Company,
including possibly seeking to call a special meeting of shareholders and the
exercise of its voting rights to the fullest extent. Further, the Purchaser
intends to seek to acquire
2
<PAGE> 4
additional Shares, in a manner permitted under applicable laws, until the
Purchaser owns at least two-thirds of the outstanding Shares. At that time, the
Purchaser would seek to consummate a statutory merger to result in all
non-tendering shareholders' being paid cash for their Shares, thereby leaving
the Purchaser as the 100% shareholder of the Company.
Plans for the Company. In the event that the Purchaser acquires a
controlling interest in the Company or elects a sufficient number of members of
the Board of Directors of the Company to direct its activities, SouthCap intends
to reduce the number of employees at the home office of the Company from its
present 31 employees to approximately 15 or 16 employees, depending upon the
conditions at the time of SouthCap's assumption of control. In addition, the
Company would engage an independent investment portfolio manager to manage its
financial assets. It is anticipated that the professional manager would be able
to provide its services at a cost of approximately 30 basis points which is
significantly lower than the current 118 basis points cost to the Company
through its current internal investment portfolio management. Additionally, the
Board of Directors of the Company would elect Mr. F. W. Lazenby to serve as the
President and Chief Executive Officer of the Company.
12. CONDITIONS OF OFFER
The Revised Minimum Condition requires the valid tender, without withdrawal
prior to the expiration of the Offer to Purchase, of that number of Shares
which, together with Shares then owned by Purchaser, represents at least 40% of
the outstanding Shares on a fully diluted basis.
14. CERTAIN LEGAL MATTERS
Indiana Insurance Laws. SouthCap has received the approval of the Indiana
Commissioner of Insurance in the form of an order to commence its tender offer
at a price of $4.50 per share. Since the Offer as set forth in this Supplement
increases the purchase price to $7.00 per share, SouthCap will request that the
Indiana Commissioner of Insurance amend and modify its existing order to permit
the offer at the price of $7.00 per share. This Offer is subject to receipt of
said approval.
Federal Securities Laws. SouthCap has filed with the Commission an amended
Schedule 14D-1 with respect to the matters set forth in this Supplement.
Indiana Takeover Laws. The approval of the Offer by the Indiana Securities
Commissioner was received on May 7, 1997. The approval permitted the use of
SouthCap's tender offer documents, including the Offer to Purchase, subject to
SouthCap's providing certain additional disclosures, which are all set forth in
Item 11 above, under "Plans for the Company."
3
<PAGE> 5
Facsimile copies of the Letter of Transmittal, properly completed and duly
executed, will be accepted. The Letter of Transmittal, certificates for Shares
and any other required documents should be sent or delivered by each shareholder
or such shareholder's investment professional to the Depositary at one of the
addresses set forth below.
THE DEPOSITARY IS:
Fifth Third Bank
<TABLE>
<S> <C> <C>
By Mail: By Hand: By Facsimile Transmission
Fifth Third Bank Fifth Third Bank (513) 744-6785
Corporate Trust Operations Corporate Trust Operations All faxes will be confirmed
Mail Drop 1090F5 15th Floor telephonically if the presenter
38 Fountain Square Plaza 38 Fountain Square Plaza provides a telephone
Cincinnati, OH 45263 Cincinnati, OH 45263 number for such purpose
</TABLE>
Any questions or requests for assistance or additional copies of the
Supplement, the Offer to Purchase, the Letter of Transmittal or the Affidavit of
Lost or Missing Stock Certificate may be directed to D.F. King & Co., Inc. at
its telephone number and location listed below. You may also contact your
broker, dealer, commercial bank, trust company or nominee for assistance
concerning the Offer.
The Information Agent for the Offer is.
D. F. King & Co., Inc.
77 Water Street
New York, NY 10005
(212) 269-5550 (Call Collect)
(800) 848-3374 (Toll-free)
<PAGE> 1
Exhibit (a)(5)
PRESS RELEASE CONTACT PERSON:
F.W. LAZENBY (615) 244-1908
Chairman, President,
Chief Executive Officer
FRED G. FRICK
Executive Vice President
SOUTHCAP CORPORATION INCREASES TENDER OFFER FOR UNITED HOME
LIFE INSURANCE COMPANY TO $7.00 PER SHARE
Nashville, Tennessee (May 12, 1997) - SouthCap Corporation announced today
that it is increasing the price of its outstanding tender offer for all the
outstanding shares of common stock of United Home Life Insurance Company
("United Home Life") to $7.00 per share from $4.50 per share. The tender offer
remains an all cash offer to the shareholders of United Home Life. SouthCap also
announced that on May 7, 1997, it received the approval of the Indiana Division
of Securities to consummate the purchase of shares pursuant to the tender offer
with additional disclosure about SouthCap's plans for operating United Home
Life. SouthCap announced that it had reduced the minimum condition from 50.1% to
40%. SouthCap said that the terms and conditions of the increased offer will be
described in an amended offer supplement which is being mailed to all
shareholders of United Home Life. The tender offer has been extended to 5:00
p.m., Indianapolis, Indiana, time on Tuesday, May 27, 1997.
Mr. F. W. Lazenby, Chairman, President and Chief Executive Officer of
SouthCap said "We believe that SouthCap's offer should be very attractive to
shareholders of United Home Life. We have been through the regulatory process,
and we believe we will be in a position to close the offer and make payments to
shareholders which will be received in early June. No other person has been
identified as making a firm offer for United Home Life. If any were to be made,
it would be subject to regulatory approvals and possibly other contingencies. We
have already cleared those hurdles, and our offer is firm, fair, and will close
in short order."
On March 27, 1997, SouthCap received the approval of the Indiana
Commissioner of Insurance to make the tender offer at the price of $4.50 per
share subject to SouthCap's disclosing additional information contained in the
amended offer supplement. SouthCap will seek an expedited modification of the
order of the Indiana Commissioner of Insurance to permit the offer at $7.00 per
share. SouthCap announced the receipt of a commitment from SunTrust Bank, N.A.,
to provide a loan of up to $6 million for use in connection with the tender
offer and in connection with the infusion of $1 million in capital to United
Home Life should SouthCap acquire at least 50.1% of the outstanding shares of
United Home Life.
Questions and requests for assistance by shareholders of United Home Life
may be directed to the Information Agent, D.F. King & Co., Inc., 77 Water
Street, New York, NY 10005, (212) 269-5550 (Collect) or (800) 848-3374
(Toll-free).
- END -
<PAGE> 1
Exhibit (B)
[SunTrust Letterhead]
May 12, 1997
SouthCap Corporation
211 Seventh Avenue #405
Nashville, Tennessee 37219
Attn: Fred G. Frick, Executive Vice
President and Chief Financial Officer
Re: $6,000,000 Loan to SouthCap Corporation
Dear Mr. Frick:
SunTrust Bank, Nashville, N.A. ("LENDER") is pleased to offer the following loan
commitment (the "COMMITMENT") to SouthCap Corporation, a Tennessee corporation,
subject to the terms and conditions set forth in this commitment letter
("COMMITMENT LETTER").
The major terms of the loan (the "LOAN") are described in general on the
attached term sheet and are incorporated herein by reference. The attached term
sheet summarizes our current understanding of the type of facility that we are
willing to offer to you, but the actual terms of the Loan will be evidenced by a
definitive and detailed loan agreement ("LOAN AGREEMENT") and related documents,
all in form and substance acceptable to Lender and containing such terms,
conditions, covenants, representations, defaults and remedies as Lender may
require (collectively, the "LOAN DOCUMENTS").
Borrower and Lender agree that this Commitment Letter does not contain all the
terms and conditions that will govern the Loan, or cover the wide variety of
issues that the Loan Documents will address. Borrower understands that the Loan
Documents will place significant restrictions on Borrower, and its subsidiaries.
Lender shall have no obligation to fund the Loan or enter into further written
agreements unless and until a satisfactory Loan Agreement and other Loan
Documents have been executed.
By your acceptance, you acknowledge that this Commitment Letter is issued in
reliance on the information that you have provided to us, and at a time before
we have completed a full business, credit, and legal analysis of Borrower and
the transactions contemplated by this Commitment. As a result of further
investigation and analysis by us and our counsel, impediments to closing may
come to our attention. While our mutual efforts will be directed toward the
closing of this transaction, we may require that the transaction be
restructured. If the conditions in this Commitment Letter have not been met to
Lender's satisfaction before closing, or if there is a material adverse change
in the business or affairs of Borrower and/or United Home Life Insurance Company
("HOME LIFE"), or if Lender discovers adverse circumstances of which it was
unaware, or if any representation of Borrower made in connection with or as an
inducement to the making of the Loan is untrue or misleading in any respect, the
commitment to lend evidenced by this Commitment Letter shall be null and void.
The parties acknowledge that this Commitment contemplates only a lending
relationship and that there is and shall be no agency, partnership, joint
venture or fiduciary relationship between Lender and Borrower.
<PAGE> 2
SouthCap Corporation
May 12, 1997
Page 2
This Commitment Letter supersedes all previous oral and written negotiations,
proposals, commitments and understandings of any nature whatsoever, and may be
amended or modified only in writing signed by all parties.
The Commitment is not transferable and may not be assigned without the written
permission of Lender.
If Borrower accepts the Commitment and the terms and conditions herein, please
have a copy of this Commitment Letter signed and delivered to Lender at the
address stated above (by facsimile transmission or otherwise), along with the
required commitment fee, on or before 5:00 p.m. (Central Time), on May 16, 1997.
This Commitment Letter shall not be effective or bind Lender unless Borrower has
accepted it and returned a signed copy to Lender by such time.
We appreciate the opportunity to respond to your financing needs and hope you
will find this commitment attractive.
Very truly yours,
SUNTRUST BANK, NASHVILLE, N.A.
By: /s/ Teresa Kirby
Title: Group Vice President
BORROWER'S ACCEPTANCE:
The foregoing terms and conditions are hereby accepted and agreed to this 12th
day of May, 1997.
SOUTHCAP CORPORATION
By: /s/ Fred G. Frick
Title: Executive Vice President
<PAGE> 3
SUNTRUST BANK, NASHVILLE, N.A.
TERM SHEET
(Attached to Commitment Letter Dated May 12, 1997)
LOAN:
- - Loan of up to $6,000,000 for a term of three (3) years. Provided, however,
that the amount advanced under the Loan shall not exceed at any time an amount
equal to the current market value of Borrower's Eligible Liquid Assets which
shall be defined in the Loan Agreement.
PURPOSE:
- - The proceeds of the Loan will be used solely by Borrower to acquire at least
50.1% of the outstanding voting stock of Home Life. No advance under the Loan
will be permitted until Borrower has acquired (or will acquire with the initial
advance) 50.1% of the outstanding voting stock of Home Life.
INTEREST RATE:
- - The Loan shall bear interest at a varying rate per annum equal to the "base
rate of interest" from time to time charged by Lender. The "base rate of
interest" is defined as that rate of interest established from time to time and
announced by Lender as the "base rate," which is used as an index for
establishing interest rates on loans. The interest rate shall be adjusted daily
to reflect any changes in such "base rate of interest".
COLLATERAL:
- - Pledge of all issued and outstanding stock of all presently existing and
hereafter acquired subsidiaries of Borrower.
- - Security interest in all presently existing and hereafter acquired assets of
the Borrower, including, without limitation, all cash accounts, securities
equipment, and any interests in real property.
- - Assignment of $2,000,000 in life insurance proceeds on the life of
F. W. Lazenby.
- - Negative pledge of all assets of Borrower's subsidiaries, whether presently
existing or hereafter acquired.
FEES AND EXPENSES:
- - Commitment fee of $12,000 fully earned and non-refundable on acceptance of
this Commitment Letter and payable upon execution of this Commitment Letter.
- - Borrower shall pay all Lender's reasonable legal fees and other expenses
and all closing costs, expenses, filing fees, and similar charges paid or
incurred in connection with this Commitment Letter, the structuring of the Loan
or otherwise in connection with the Loan, regardless of whether the Loan is
closed or funded, and all costs and expenses incurred by Lender in the
enforcement or protection of its rights. All such amounts shall be due and
payable by Borrower upon Lender's demand.
<PAGE> 4
FINANCIAL REPORTING:
Quarterly unaudited consolidated and consolidating financial statements, annual
audited consolidated and consolidating financial statements, and other
information as requested by Lender.
CONDITIONS AND CONTINGENCIES:
Completion of Lender's due diligence and legal review. Negotiation and execution
of loan agreement, notes, security agreements, mortgages, pledge agreements,
negative pledge agreements, certificates, financing statements and other
documentation in form and substance satisfactory to Lender, containing such
terms, conditions, representations, warranties, covenants, defaults, remedies
and other matters as Lender may deem appropriate, which may be different from or
in addition to those described herein. Satisfactory legal opinions and evidence
of Borrower's status and authorization of Loan. Other conditions include the
absence of material adverse change in Borrower's condition or business.
GOVERNING LAW:
This Commitment Letter and the Loan Documents shall be governed by Tennessee
law.
EXPIRATION AND ACCEPTANCE:
5:00 p.m. (Central Time) on May 16, 1997. Once accepted, should the Loan not
close for any reason, this Commitment Letter shall not be effective or bind
Lender, but Borrower shall reimburse Lender for all its costs and expenses
(including reasonable legal fees) incurred in connection with the preparation of
the Loan Documents and the transactions described herein. Any commitment made
pursuant to this Commitment Letter or in respect of the Loan shall expire if the
definitive Loan Agreement and other Loan Documents are not fully executed and
delivered within 60 days after the date that this Commitment Letter is signed by
Borrower.
