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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 12b-25
NOTIFICATION OF LATE FILING
Commission File Number: 0-15286
X FORM 10-K FORM 20-F FORM 11-K FORM 10-Q FORM N-SAR
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For the Period Ended: December 31, 1996
Transition Report on Form 10-K
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Transition Report on Form 20-F
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Transition Report on Form 11-K
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Transition Report on Form 10-Q
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Transition Report on Form N-SAR
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For the Transition Period Ended:
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Nothing in this form shall be construed to imply that the Commission has
verified any information contained herein.
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If the notification relates to a portion of the filing checked above,
identify the Item(s) to which the notification relates:
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PART I - Registrant Information
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Full Name of Registrant: Chandler Insurance Company, Ltd.
Former name if applicable: n/a
Address of Principal Executive Officer: 5th Floor - Anderson Square
P.O. Box 1854
Grand Cayman, Cayman Islands, B.W.I.
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PAGE 2
PART II - Rules 12b-25(b) and (c)
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If the subject report could not be filed without unreasonable effort or
expense and the registrant seeks relief pursuant to Rule 12b-25(b), the
following should be completed.
X (a) The reasons described in reasonable detail in Part III of this
--- form could not be eliminated without unreasonable effort or
expense;
X (b) The subject annual report, semi-annual report, transition report
--- on Form 10-K, Form 20-F, 11-K or Form N-SAR, or portion thereof
will be filed on or before the fifteenth calendar day following
the prescribed due date; or the subject quarterly report or
transition report on Form 10-Q, or portion thereof will be filed
on or before the fifth calendar day following the prescribed due
date; and
(c) The accountant's statement or other exhibit required by Rule
--- 12b-25(c) has been attached if applicable.
PART III - Narrative
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State below in reasonable detail the reasons why Form 10-K, 20-F, 11-K or
N-SAR or the transition report or portion thereof could not be filed within the
prescribed time period.
In the Company's Annual Report on Form 10-K for the year ended December 31,
1995 and the Company's 1996 third quarter report on Form 10-Q, the Company
reported on certain legal proceedings pending in the United States District
Court for the Western District of Oklahoma involving the CenTra group. Trial
began on February 13, 1997. The Company believes that the trial will be
concluded prior to the fifteenth calendar day after the due date of the report,
although there can be no assurances with respect to the timing or the outcome of
the trial proceedings. The Company believes that the outcome of the trial could
possibly affect the Company's responses to certain disclosures in Form 10-K.
For the reasons set forth above, the Company's inability to file timely its
Annual Report on Form 10-K for the year ended December 31, 1996 could not
reasonably be eliminated by the Company at March 31, 1997. The Company intends
to file the subject Annual Report on Form 10-K no later than the fifteenth
calendar day after the due date of the report.
PART IV - Other Information
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(1) Name and telephone number of person to contact in regard to this
notification.
Mr. Steven R. Butler (345) 949-8177
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(Name) (Area Code)(Telephone Number)
(2) Have all other periodic reports required under section 13 or 15(d) of
the Securities Exchange Act of 1934 or section 30 of the Investment
Company Act of 1940 during the preceding 12 months or for such shorter
period that the registrant was required to file such report(s) been
filed? If the answer is no identify report(s). X Yes No
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(3) Is it anticipated that any significant change in results of operations
from the corresponding period for the last fiscal year will be
reflected by the earnings statements to be included in the subject
report or portion thereof? X Yes No
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If so: attach an explanation of the anticipated change, both
narratively and quantitatively, and, if appropriate, state the reasons
why a reasonable estimate of the results cannot be made.
Due to the effects of a number of unusual charges, net income for 1996
totaled $972,000 compared to a net income of $3,778,000 for 1995. A
net loss of $495,000 resulted in the fourth quarter of 1996 compared
to net income of $1,312,000 in the fourth quarter of 1995. Earnings
for 1996 were affected by charges totaling $1.5 million (including
$534,000 in the fourth quarter of 1996) for the settlement attributed
to legal proceedings and related matters arising from the termination
of an underwriting and production contract with the Company's former
underwriting manager for a portion of the Company's surety bond
program. In addition, legal expenses related to these matters were
$441,000 for 1996, including $240,000 in the fourth quarter of 1996.
The Company's results for 1996 also reflect a charge totaling $1.1
million from a second quarter arbitration award that was lower than
expected. Legal expenses related to the arbitration award were
$527,000 in 1996.
In the third quarter of 1996, the Company recorded a $982,000
estimated recovery of costs from its directors and officers liability
insurer related to the Company's claim for reimbursable amounts
previously paid for defense and litigation costs associated with the
litigation involving the CenTra group. Excluding the effects of the
unusual charges and related expenses and the estimated recovery, net
income would have been $2.7 million and $40,000, respectively, for the
year and fourth quarter ended December 31, 1996.
In addition, litigation expenses related to an ongoing shareholder
legal proceeding involving the CenTra group increased significantly
in the fourth quarter of 1996 in preparation of a trial which began on
February 13, 1997. Significant litigation expenses are also
anticipated in the first quarter of 1997. Litigation expenses in the
fourth quarter of 1996 were $653,000 versus a credit of $575,000 in
the fourth quarter of 1995, which included an estimated recovery of
$818,000 from the Company's directors and officers liability insurer.
Litigation expenses for the year were a credit of $108,000 in 1996,
including an additional estimated recovery of $982,000, which was
recorded in the third quarter, versus $285,000 in 1995.
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CHANDLER INSURANCE COMPANY, LTD.
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(Name of registrant as specified in charter)
has caused this notification to be signed on its behalf by the undersigned
thereunto duly authorized.
Date: March 31, 1997 By: /s/ Mark T. Paden
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Mark T. Paden,
Vice President - Finance
and Chief Financial Officer
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ATTENTION
Intentional misstatements or omissions of fact constitute Federal Criminal
Violations (See 18 U.S.C. 1001).
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