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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
MERIDIAN INSURANCE GROUP, INC.
(Name of Issuer)
COMMON STOCK, NO PAR VALUE
(Title of Class of Securities)
589644-10-3
(CUSIP Number)
Gregory M. Shepard
303 East Washington Street
Bloomington, Illinois 61701
Telephone: (309) 557-1210
Facsimile (309) 827-0303
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
August 30, 2000
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of (S)(S)240.13d-l(e), 240.13d-l(f) or 240.13d-l(g), check the
following box. [ ]
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See (S)240.13d-7(b) for other
parties to whom copies are to be sent.
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
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CUSIP NO. 589644-10-3
-----------------
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NAMES OF REPORTING PERSON
1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS.
Meridian Insurance Group Acquisition Corporation
I.R.S. No. 37-1401664
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
2 (a) [X]
(b) [_]
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SEC USE ONLY
3
------------------------------------------------------------------------------
SOURCE OF FUNDS (See Instructions)
4
OO
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CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [_]
5
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CITIZENSHIP OR PLACE OF ORGANIZATION
6
Illinois
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SOLE VOTING POWER
7
NUMBER OF 0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
0
OWNED BY
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING 0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
0
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
0
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CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
12
(See Instructions) [_]
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
0.0%
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TYPE OF REPORTING PERSON (See Instructions)
14
CO
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CUSIP NO. 589644-10-3
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NAMES OF REPORTING PERSON
1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS.
American Union Insurance Company
I.R.S. No. 37-0558630
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
2 (a) [X]
(b) [_]
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SEC USE ONLY
3
------------------------------------------------------------------------------
SOURCE OF FUNDS (See Instructions)
4
OO
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CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [_]
5
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CITIZENSHIP OR PLACE OF ORGANIZATION
6
Illinois
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SOLE VOTING POWER
7
NUMBER OF 0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
0
OWNED BY
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING 0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
0
------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
0
------------------------------------------------------------------------------
CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
12
(See Instructions) [_]
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
0.0%
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TYPE OF REPORTING PERSON (See Instructions)
14
CO
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CUSIP NO. 589644-10-3
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NAMES OF REPORTING PERSON
1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS.
Gregory M. Shepard
S.S No. ###-##-####
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
2 (a) [X]
(b) [_]
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SEC USE ONLY
3
------------------------------------------------------------------------------
SOURCE OF FUNDS (See Instructions)
4
OO
------------------------------------------------------------------------------
CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [X]
5
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CITIZENSHIP OR PLACE OF ORGANIZATION
6
Illinois
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SOLE VOTING POWER
7
NUMBER OF 1,588,400
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
0
OWNED BY
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING 1,588,400
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
0
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
1,588,400
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CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
12
(See Instructions) [_]
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
20.23%
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TYPE OF REPORTING PERSON (See Instructions)
14
IN
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PAGE>
CUSIP NO. 589644-10-3
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NAMES OF REPORTING PERSON
1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS.
Tracy M. Shepard
S.S. No. ###-##-####
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
2 (a) [X]
(b) [_]
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SEC USE ONLY
3
------------------------------------------------------------------------------
SOURCE OF FUNDS (See Instructions)
4
OO
------------------------------------------------------------------------------
CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [_]
5
------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION
6
Illinois
------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF 0
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
0
OWNED BY
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING 0
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
0
------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
0
------------------------------------------------------------------------------
CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
12
(See Instructions) [_]
------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
0.0%
------------------------------------------------------------------------------
TYPE OF REPORTING PERSON (See Instructions)
14
IN
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<PAGE>
Item 1. Security and Issuer.
This statement on Schedule 13D relates to the offer to purchase all of the
outstanding shares of common stock, no par value per share (the "Shares"), of
Meridian Insurance Group, Inc. (the "Company") at a price of $20.00 per share,
net to the seller in cash and without interest thereon, on the terms and subject
to the conditions set forth in the Offer to Purchase, dated August 31, 2000 (the
"Offer to Purchase") and the related Letter of Transmittal (which, as amended
from time to time, together constitute the "Offer"). The principal executive
offices of the Company are located at 2955 North Meridian Street, P.O. Box 1980,
Indianapolis, Indiana 46206.
Item 2. Identity and Background.
(a)-(c) This Schedule 13D is filed by American Union Insurance Company, an
Illinois stock insurance company ("Parent"), Meridian Insurance Group
Acquisition Corporation, an Illinois corporation ("Offeror") and a wholly owned
subsidiary of Parent (Offeror and Parent are sometimes referred to as, the "AUIC
Companies"), Gregory M. Shepard ("G. Shepard"), the Chairman of the Board of
Directors and President of Parent, and Tracy M. Shepard ("T. Shepard"), the
Executive Vice President and a Director of Parent. Parent is in the property
and casualty insurance business. Offeror is newly formed by Parent in
connection with the Offer and the transactions contemplated thereby. It is not
anticipated that, prior to the consummation of the Offer and the transactions
contemplated thereby, Offeror will have any significant assets or liabilities or
will engage in any activities other than those incident to the Offer and the
transactions contemplated thereby. The principal business offices of each of
G. Shepard, T. Shepard and the AUIC Companies are located at 303 East Washington
Street, Bloomington, Illinois 61701. Attached hereto as Exhibit A is a list of
all executive officers and directors of the AUIC Companies, including the
principal business address, the principal occupation or employment and the
citizenship of each.
(d)-(e) During the five years prior to the date hereof, except as
disclosed below, none of the AUIC Companies or, to the best of their knowledge,
any executive officer or director of any of the AUIC Companies, (i) has been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) or (ii) has been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction, as a result of which, such person
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws. G.
Shepard became a party to a consent decree issued by the Securities and Exchange
Commission on May 11, 2000. The consent decree states that during April 1999 G.
Shepard, through Parent, purchased shares of the Company on the open market
during the pendency of a tender offer by the Parent for shares of the Company in
violation of Rule 10b-13. G. Shepard, without admitting or denying the
findings, consented to the entry of the consent decree stating that G. Shepard
should cease and desist from committing any violation, or future violation, of
Rule 14e-5 (formerly Rule 10b-13) of the Act.
Item 3. Source and Amount of Funds or Other Consideration.
The total amount of funds required to purchase all of the Shares and to pay
G. Shepard's and the AUIC Companies' related fees and expenses is approximately
$135.9 million. Offeror intends to obtain all of such funds from a capital
contribution from Parent. Parent plans to obtain such funds from any and all
sources available to Parent.
Item 4. Purpose of Transaction.
(a) The purpose of the Offer and the proposed second-step merger, pursuant
to which the Company will merge with and into Offeror with the Company
continuing as the surviving corporation (the "Proposed Merger"), is to enable
Parent, of which G. Shepard owns 50% of the outstanding common stock and T.
Shepard, his brother, owns 50% of the outstanding common stock, to acquire
control of, and the entire equity interest in, the Company. Parent intends to
continue to seek to negotiate with the Company with respect to the acquisition
of the Company. In accordance with applicable law and subject to the terms of
any merger agreement that it may enter with the Company, Parent or G. Shepard
may explore any and all options which may be available to them. In this regard,
and after expiration or termination of the Offer, Parent or G. Shepard may seek
to acquire additional shares of common stock of the Company through open market
purchases, privately negotiated transactions, a tender offer or
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exchange or otherwise, upon such terms and at such prices as they may determine.
In connection with the Offer and Proposed Merger, (i) Parent and Offeror intend,
if necessary, to solicit proxies or consents to call a special meeting, at
which, shareholders would be asked to elect a slate of nominees for directors of
the Company who support the Offer and the Proposed Merger and to remove all of
the members of the board of directors of the Company, (ii) Offeror, G. Shepard
and Parent instituted a declaratory judgment action against the board of
directors of the Company in the Southern District of Indiana claiming that an
amendment to the articles of incorporation of the Company was ineffective (if
successful in their declaratory judgment action, the Company will be deemed to
have opted out of Chapters 42 and 43 of the Indiana Business Corporation Statute
which will remove certain barriers to acquiring controlling interests in the
Company), (iii) Offeror will require the board of directors of the Company to
redeem the Company's preferred share purchase rights at a redemption price of
$0.005 per right, and (iv) G. Shepard intends to contribute his interest in the
Company to Parent.
(b) Reference is hereby made to the disclosure regarding the Offer and the
Proposed Merger set forth in subparagraph (a) of this Item 4 and to Schedule TO
(as defined below), which is herein incorporated by reference.
(d) Reference is hereby made to the disclosure regarding the Offer and the
Proposed Merger set forth in subparagraph (a) of this Item 4 and to Schedule TO
(as defined below), which is herein incorporated by reference.
(g) Reference is hereby made to the disclosure regarding the Offer and the
Proposed Merger set forth in subparagraph (a) of this Item 4 and to Schedule TO
(as defined below), which is herein incorporated by reference.
Except as indicated in this Schedule 13D, the statement on Schedule 13D of
G. Shepard filed with the Securities and Exchange Commission on August 31, 1998,
as amended (the "G. Shepard 13D"), the contents of which are herein incorporated
by reference, or as disclosed in the Schedule TO of Offeror and Parent filed
with the Securities and Exchange Commission on August 30, 2000 (the "Schedule
TO"), the contents of which, including, without limitation, all exhibits of the
Schedule TO, are incorporated herein by reference, neither G. Shepard, T.
Shepard, nor the AUIC Companies currently have any specific plans or proposals
that relate to or would result in any of the matters described in subparagraphs
(a) through (j) of Item 4 of Schedule 13D.
Item 5. Interests in Securities of the Issuer.
(a) On the date of this statement, the aggregate number of Shares of which
G. Shepard may be deemed the beneficial owner is 1,588,400, all of which are
held by G. Shepard as an individual.
(b) G. Shepard has the sole power to vote and the sole power to dispose or
direct the disposition of the 1,588,400 Shares he holds as an individual. G.
Shepard does not have shared power to vote or direct the vote or dispose or
direct the disposition of any Shares.
(c) Between November 3, 1999 and August 30, 2000, Shepard purchased a total
of 400 Shares on November 5, 1999, in an open market transaction effective on
the NASDAQ, at a price of $16.5625 per share. On December 15, 1999, the Company
declared a 10% stock dividend to each shareholder of record as of December 27,
1999, which resulted in Shepard receiving 144,400 additional Shares to the
1,444,000 Shares Shepard held on that date.
(d) No other person has the right to receive or the power to direct the
receipt of dividends from, or the proceeds from the sale of, the Shares
disclosed herein as being beneficially owned by G. Shepard.
(e) Not applicable.
Item 6. Contracts, Arrangements, Underwritings or Relationships with Respect
to Securities of the Issuer.
Except as described in this Schedule 13D, the G. Shepard 13D, or in the
Schedule TO, none of G. Shepard, T. Shepard, the AUIC Companies or, to the best
of their knowledge, any executive officer or director thereof, has any other
contracts, arrangements, understandings or relationships with any persons with
respect to any securities of
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the Company. It is the intention of G. Shepard to contribute his current
ownership interest in the Company to Parent. The description of the transactions
discussed in Item 4 and this Item 6 are further described in the Schedule TO and
the exhibits to the Schedule TO. Such documents are incorporated by reference
for all of the terms and conditions of such documents.
Item 7. Material to be Filed as Exhibits.
Exhibit A Executive Officers and Directors of the AUIC Companies
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SIGNATURE
Dated: August 30, 2000
MERIDIAN INSURANCE GROUP ACQUISITION
CORPORATION
By: /s/ Gregory M. Shepard
---------------------------
Name: Gregory M. Shepard
-------------------------
Its: President
--------------------------
AMERICAN UNION INSURANCE COMPANY
By: /s/ Gregory M. Shepard
---------------------------
Name: Gregory M. Shepard
-------------------------
Its: President
--------------------------
/s/ Gregory M. Shepard
------------------------------
GREGORY M. SHEPARD
/s/ Tracy M. Shepard
------------------------------
TRACY M. SHEPARD
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EXHIBIT INDEX
Exhibit A Executive Officers and Directors of the AUIC Companies
