<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarterly Period Ended September 30, 1996
------------------------------------------------------
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from _________________________ to ___________________
Commission file 0-18298
number --------------------------------------------------------
Unitrin, Inc.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 95-4255452
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One East Wacker Drive, Chicago, Illinois 60601
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(312)661-4600
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
Not Applicable
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
------ ------
37,271,699 shares of common stock, $0.10 par value, were outstanding as of
September 30, 1996.
<PAGE>
UNITRIN, INC.
INDEX
Page
--------
PART I. Financial Information.
Item 1. Financial Statements.
Condensed Consolidated Statements of 1
Income for the Nine and Three Months Ended
September 30, 1996 and 1995 (Unaudited).
Condensed Consolidated Balance Sheets as of 2
September 30, 1996 (Unaudited) and
December 31, 1995.
Condensed Consolidated Statements of Cash 3
Flows for the Nine Months Ended
September 30, 1996 and 1995 (Unaudited).
Notes to the Condensed Consolidated 4-5
Financial Statements (Unaudited).
Item 2. Management's Discussion and Analysis of 6-8
Results of Operations and Financial Condition.
PART II. Other Information.
Item 6. Exhibits and Reports on Form 8-K. 9
Signatures 10
<PAGE>
UNITRIN, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in millions, except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
----------------------------------- ---------------------------------
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
1996 1995 1996 1995
----------------- ----------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Revenues:
Premiums $ 917.2 $ 793.6 $ 304.1 $ 263.3
Consumer Finance Revenues 89.2 78.4 30.3 27.2
Net Investment Income 133.5 140.6 44.0 43.6
Net Gains on Sales of Investments 1.6 54.3 0.4 20.6
----------------- ----------------- ---------------- ----------------
Total Revenues 1,141.5 1,066.9 378.8 354.7
----------------- ----------------- ---------------- ----------------
Expenses:
Insurance Claims and Policyholders' Benefits 603.3 522.5 191.4 171.1
Insurance Expenses 368.4 336.8 121.0 111.9
Consumer Finance Expenses 73.1 61.2 24.9 21.6
Interest and Other Expenses 11.7 23.7 4.4 6.8
----------------- ----------------- ---------------- ----------------
Total Expenses 1,056.5 944.2 341.7 311.4
----------------- ----------------- ---------------- ----------------
Income before Income Taxes and Equity
in Net Income of Investees 85.0 122.7 37.1 43.3
Income Tax Expense 28.5 42.4 12.7 15.2
----------------- ----------------- ---------------- ----------------
Income before Equity in Net Income of Investees 56.5 80.3 24.4 28.1
Equity in Net Income of Investees 36.5 32.5 13.7 11.9
----------------- ----------------- ---------------- ----------------
Net Income $ 93.0 $ 112.8 $ 38.1 $ 40.0
================= ================= ================ ================
Net Income Per Share - Note 2 $ 2.46 $ 2.76 $ 1.02 $ 1.01
================= ================= ================ ================
</TABLE>
The Notes to the Condensed Consolidated Financial Statements are an integral
part of these financial statements.
1
<PAGE>
UNITRIN, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in millions)
<TABLE>
<CAPTION>
September 30, December 31,
1996 1995
------------- ------------
(Unaudited)
<S> <C> <C>
Assets:
Investments:
Fixed Maturities at Fair Value (Amortized
Cost: 1996 - $2,243.7; 1995 - $2,365.1) $ 2,263.2 $ 2,457.1
Equity Securities at Fair Value
(Cost: 1996 - $165.3; 1995 - $97.7) 246.4 179.3
Investees at Cost Plus Cumulative Undistributed Earnings
(Fair Value: 1996 - $1,529.2; 1995 - $1,320.3) 649.9 595.2
Other 151.9 178.1
------------- ------------
Total Investments 3,311.4 3,409.7
------------- ------------
Cash 11.8 9.1
Consumer Finance Receivables 596.1 547.1
Other Receivables 376.3 250.4
Other Assets 592.3 602.4
------------- ------------
Total Assets $ 4,887.9 $ 4,818.7
============= ============
Liabilities and Shareholders' Equity:
Insurance Reserves:
Life and Health $ 1,598.0 $ 1,569.5
Property and Casualty 440.0 437.8
------------- ------------
Total Insurance Reserves 2,038.0 2,007.3
------------- ------------
Investment Certificates and Passbook Accounts 571.6 519.0
Notes Payable 129.1 100.2
Accrued Expenses and Other Liabilities 700.5 667.7
------------- ------------
Total Liabilities 3,439.2 3,294.2
------------- ------------
Shareholders' Equity:
Common Stock, $0.10 par value, 100 million Shares Authorized;
37,271,699 and 38,490,287 Shares Outstanding at
September 30, 1996 and December 31, 1995 3.7 3.8
Additional Paid-in Capital 125.0 126.2
Retained Earnings 1,253.9 1,281.1
Net Unrealized Appreciation on Securities 66.1 113.4
------------- ------------
Total Shareholders' Equity 1,448.7 1,524.5
------------- ------------
Total Liabilities and Shareholders' Equity $ 4,887.9 $ 4,818.7
============= ============
</TABLE>
The Notes to the Condensed Consolidated Financial Statements are an integral
part of these financial statements.
2
<PAGE>
UNITRIN, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in millions)
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
---------------------------------
September 30, September 30,
1996 1995
--------------- --------------
<S> <C> <C>
Operating Activities:
Net Income $ 93.0 $ 112.8
Adjustments to Reconcile Net Income to Net Cash
Provided by Operations:
Change in Deferred Policy Acquisition Costs 11.0 6.5
Equity in Net Income of Investees before Taxes (55.8) (49.7)
Cash Dividends from Investee 1.1 1.1
Amortization of Fixed Maturities 18.7 17.0
Increase in Insurance Reserves and Unearned Premiums 17.9 17.1
Change in Accrued Expenses and Other Liabilities 19.8 8.3
Net Gains on Sales of Investments (1.6) (54.3)
Provision for Loan Losses 19.6 15.8
Other, Net 10.5 21.1
--------------- --------------
Net Cash Provided by Operating Activities 134.2 95.7
--------------- --------------
Investing Activities:
Sales and Maturities of Fixed Maturities 180.0 561.9
Purchases of Fixed Maturities (74.7) (310.4)
Sales of Equity Securities 6.7 70.7
Purchases of Equity Securities (74.1) (8.2)
Change in Consumer Finance Receivables (68.6) (81.0)
Change in Short-term Investments 20.9 (22.9)
Other, Net (12.0) (8.8)
--------------- --------------
Net Cash Provided by Investing Activities (21.8) 201.3
--------------- --------------
Financing Activities:
Change in Investment Certificates and Passbook Accounts 52.6 62.7
Universal Life and Annuity Account Payments to Reinsurer (79.6) -
Other Changes in Universal Life and Annuity Accounts 10.1 14.3
Notes Payable Proceeds 122.0 308.0
Notes Payable Payments (93.5) (252.0)
Cash Dividends Paid (62.5) (61.4)
Common Stock Repurchases (60.6) (379.8)
Other, Net 1.8 4.4
--------------- --------------
Net Cash Used by Financing Activities (109.7) (303.8)
--------------- --------------
Increase (Decrease) in Cash 2.7 (6.8)
Cash, Beginning of Year 9.1 23.3
--------------- --------------
Cash, End of Period $ 11.8 $ 16.5
=============== ==============
</TABLE>
The Notes to the Condensed Consolidated Financial Statements are an integral
part of these financial statements.
3
<PAGE>
UNITRIN, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1 - Basis of Presentation
The unaudited Condensed Consolidated Financial Statements included herein have
been prepared by the Company pursuant to the rules and regulations of the
Securities and Exchange Commission (the "Commission") but do not include all
information and footnotes required by generally accepted accounting principles.
In the opinion of management, the Condensed Consolidated Financial Statements
reflect all adjustments necessary for a fair presentation. The preparation of
interim financial statements relies heavily on estimates. This factor and
certain other factors, such as the seasonal nature of some portions of the
insurance business, as well as market conditions, call for caution in drawing
specific conclusions from interim results. The accompanying Condensed
Consolidated Financial Statements should be read in conjunction with the
Consolidated Financial Statements and related notes included in the Company's
Annual Report on Form 10-K filed with the Commission for the year ended December
31, 1995.
Certain prior year amounts have been reclassified to conform to the current
year's presentation.
Note 2 - Shareholders' Equity
On August 11, 1994, the Company's Board of Directors authorized the repurchase
of up to ten million shares of the Company's outstanding common stock, including
approximately 1.4 million shares remaining under its August 8, 1990 repurchase
authorization, in open market or privately negotiated transactions from time to
time subject to market conditions and other factors. On February 17, 1995 and
July 31, 1996, the Company's Board of Directors authorized the repurchase of an
additional five million and three million shares of the Company's outstanding
common stock, respectively, for an aggregate authorization of eighteen million
shares. During the nine months ended September 30, 1996, the Company repurchased
1,268,175 shares of its common stock in open market transactions at an aggregate
cost of $60.6 million, bringing the total number of common shares repurchased
since August 1994 to 14,754,633 at a total cost of $721.9 million. Common Stock,
Additional Paid-in Capital and Retained Earnings have been reduced on a pro rata
basis for the cost of the repurchased shares.
In the first nine months of 1996, the Compensation Committee of the Board of
Directors granted non-qualified stock options under the Company's 1990 Stock
Option Plan covering 475,813 common shares at exercise prices ranging from
$46.00 to $51.00, which equaled the fair market value of such shares on the
dates of grant. The options granted are primarily exercisable in installments
beginning two years from the date of grant and expire ten years from the date of
grant. As of September 30, 1996, options for 1,884,513 common shares were
outstanding and options covering 393,700 common shares were available for future
grant under the 1990 Stock Option Plan.
On May 1, 1996, the Company's shareholders approved the 1995 Non-Employee
Director Stock Option Plan (the "Director Plan"). On May 1, 1996, two of the
Company's directors each received options to purchase 2,000 shares of the
Company's common stock at an exercise price of $48.50 per common share, which
equaled the fair market value of the shares on the date of grant. As of
September 30, 1996, options for 8,000 common shares were outstanding under the
Director Plan, including options for 4,000 shares which were granted prior to
May 1, 1996 conditioned upon shareholder approval.
4
<PAGE>
Note 2 - Shareholders' Equity (continued)
Net Income Per Share was computed using 37,865,186 and 40,921,466 weighted
average shares for the nine months ended September 30, 1996 and 1995,
respectively, and using 37,338,213 and 39,523,195 weighted average shares for
the three months ended September 30, 1996 and 1995, respectively. Common stock
equivalents of approximately 265,000 were excluded from the computation of
primary net income per share and common stock equivalents of approximately
298,000 were excluded from the computation of fully diluted net income per share
for the nine months ended September 30, 1996 because the effect of dilution of
net income per share was less than 3 percent. Common stock equivalents of
approximately 264,000 were excluded from the computation of primary net income
per share and common stock equivalents of approximately 298,000 were excluded
from the computation of fully diluted net income per share for the three months
ended September 30, 1996 because the effect of dilution of net income per share
was less than 3 percent. Common stock equivalents of approximately 292,000 were
excluded from the computation of both primary and fully diluted net income per
share for the nine months ended September 30, 1995 because the effect of
dilution of net income per share was less than 3 percent. Common stock
equivalents of approximately 282,000 were excluded from the computation of both
primary and fully diluted net income per share for the three months ended
September 30, 1995 because the effect of dilution of net income per share was
less than 3 percent.
Note 3 - Contingencies
The Company and its subsidiaries are parties to various legal actions incidental
to their businesses. Some of these actions seek substantial punitive damages
that bear no apparent relationship to the actual damages alleged. Although no
assurances can be given and no determination can be made at this time as to the
outcome of any particular legal action, the Company and its subsidiaries believe
there are meritorious defenses to these legal actions and are defending them
vigorously. The Company believes that resolution of these matters will not have
a material adverse effect on the Company's financial position.
In connection with one such action, Ronnie Dale Bleeker v. Trinity Universal
Insurance Company ("Trinity"), et al.. the District Court of Hidalgo County,
Texas, on February 9, 1995 entered a judgement in the amount of $77.0 million,
including attorney fees of $38.5 million, against Trinity, one of the Company's
subsidiaries. The case involves Trinity's alleged improper handling of a claim
made under a $40 thousand automobile insurance policy. Trinity has strongly
denied any wrongdoing and intends to pursue vigorously all avenues for relief
from the judgment. The matter is presently on appeal to the Thirteenth Court of
Appeals in Corpus Christi, Texas. The ultimate outcome of this litigation cannot
presently be predicted. However, the Company believes that Trinity has a number
of meritorious grounds for appeal and, accordingly, the judgment has not been
accrued in the financial statements.
Effective May 31, 1996, United Insurance Company of America, one of the
Company's Life and Health Insurance subsidiaries ("United"), entered into an
agreement to cede certain life insurance policies to a third party. Life
insurance reserves related to this agreement were $124.7 million. At September
30, 1996 the Company had not been relieved of its primary obligation to these
policyholders. In accordance with the provisions of SFAS Statement 113,
Accounting and Reporting for Reinsurance of Short Duration and Long Duration
Contracts, the Company therefore continues to include the life insurance
reserves related to this block of business on its balance sheet along with a
corresponding amount classified as Other Receivables. Other Receivables
increased by $124.7 million for the nine months ended September 30, 1996 due to
this transaction.
Note 4 - Supplemental Cash Flow Information
Significant non-cash activity related to the Company's investments in Fixed
Maturities and Equity Securities for the nine months ended September 30, 1996
were:
<TABLE>
<CAPTION>
(Dollars in Millions)
<S> <C>
Decrease in Unrealized Appreciation on Securities $ (73.0)
Effect of Income Taxes 25.7
-----------
Decrease in Net Unrealized Appreciation on Securities $ (47.3)
===========
</TABLE>
5
<PAGE>
Item 2. Management's Discussion and Analysis of Results of Operations and
Financial Condition
UNITRIN, INC. AND SUBSIDIARIES
SUMMARIZED FINANCIAL INFORMATION
(Dollars in millions)
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
-------------------------- ------------------------
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
1996 1995 1996 1995
------------ ------------ ----------- -----------
<S> <C> <C> <C> <C>
Revenues:
Property and Casualty Insurance:
Premiums $ 546.7 $ 407.8 $ 184.6 $ 136.0
Net Investment Income 37.2 31.4 12.3 10.0
------------ ------------ ----------- -----------
Total Property and Casualty Insurance 583.9 439.2 196.9 146.0
------------ ------------ ----------- -----------
Life and Health Insurance:
Premiums 370.5 385.8 119.5 127.3
Net Investment Income 93.1 106.6 30.5 32.5
------------ ------------ ----------- -----------
Total Life and Health Insurance 463.6 492.4 150.0 159.8
------------ ------------ ----------- -----------
Consumer Finance 89.2 78.4 30.3 27.2
------------ ------------ ----------- -----------
Total Segment Revenues 1,136.7 1,010.0 377.2 333.0
------------ ------------ ----------- -----------
Net Gains on Sales of Investments 1.6 54.3 0.4 20.6
Other Revenues 3.2 2.6 1.2 1.1
------------ ------------ ----------- -----------
Total Revenues $ 1,141.5 $ 1,066.9 $ 378.8 $ 354.7
============ ============ =========== ===========
Income before Income Taxes and
Equity in Net Income of Investees:
Property and Casualty Insurance $ 44.9 $ 30.5 $ 22.8 $ 13.4
Life and Health Insurance 28.9 40.0 11.2 8.9
Consumer Finance 20.1 20.1 6.9 6.5
------------ ------------ ----------- -----------
Total Segment Operating Profit 93.9 90.6 40.9 28.8
------------ ------------ ----------- -----------
Net Gains on Sales of Investments 1.6 54.3 0.4 20.6
Net Corporate Interest Expense (1.6) (6.2) (0.7) (1.5)
Other Corporate Expense (8.9) (16.0) (3.5) (4.6)
------------ ------------ ----------- -----------
Income before Income Taxes and
Equity in Net Income Of Investees $ 85.0 $ 122.7 $ 37.1 $ 43.3
============ ============ =========== ===========
</TABLE>
6
<PAGE>
PROPERTY AND CASUALTY INSURANCE
Premiums in the Property and Casualty Insurance segment increased by $48.6
million and $138.9 million, respectively, for the three and nine months ended
September 30, 1996, compared to the same periods in 1995, primarily due to the
October 2, 1995 acquisition of Milwaukee Insurance Group, Inc. ("Milwaukee
Insurance"). The first nine months of 1995 included $5.7 million of favorable
premium adjustments related to California Proposition 103. Net investment Income
excluding Milwaukee Insurance decreased by $1.4 million and $5.1 million,
respectively, due to a lower level of investments in fixed maturities. Operating
Profit in the Property and Casualty Insurance segment increased by $9.4 million
and $14.4 million, respectively, due primarily to lower storm damage partially
resulting from the Company's efforts to reduce its concentration of business in
storm prone areas and lower automobile insurance claims as a percentage of
premium for the third quarter of 1996. The acquisition of Milwaukee Insurance
increased Operating Profit in the Property and Casualty Insurance segment by
approximately $0.4 million and $1.9 million, respectively. Claims from Hurricane
Fran were not significant.
LIFE AND HEALTH INSURANCE
Premiums in the Life and Health Insurance segment decreased by $7.8 million and
$15.3 million for the three and nine months ended September 30, 1996, compared
to the same periods in 1995, primarily due to lower volume of Accident and
Health Insurance. Net Investment Income in the Life and Health Insurance segment
decreased by $2.0 million and $13.5 million, respectively, due primarily to a
lower level of investments as a result of certain prior year intercompany
transactions.
Operating Profit in the Life and Health Insurance segment increased by $2.3
million for the third quarter of 1996 due primarily to lower Life Insurance
benefits expense as a percentage of premium, partially offset by the lower net
investment income. Operating Profit decreased by $11.1 million for the first
nine months of 1996, due primarily to the lower net investment income.
Effective May 31, 1996, United Insurance Company of America, one of the
Company's Life and Health Insurance subsidiaries ("United"), entered into an
agreement to cede certain life insurance policies to a third party. Life
insurance reserves related to this block were approximately $124.7 million. At
September 30, 1996 the Company had not been relieved of its primary obligation
to these policyholders. In accordance with the provision of SFAS Statement 113,
Accounting and Reporting for Reinsurance of Short Duration and Long Duration
Contracts, the Company therefore continues to include the life insurance
reserves related to this block of business on its balance sheet along with a
corresponding amount classified as Other Receivables. Other Receivables
increased by approximately $124.7 million during 1996 due to this transaction.
As a result of this transaction annual premiums in the Life and Health Insurance
segment will decrease by approximately $13 million. The effect of this
transaction on Operating Profit is not material.
CONSUMER FINANCE
Revenues in the Consumer Finance segment increased by $3.1 million and $10.8
million for the three and nine months ended September 30, 1996, compared to the
same periods in 1995, as a result of a higher level of loans outstanding.
Operating Profit in the Consumer Finance segment increased by $0.4 million for
the third quarter of 1996 due primarily to the higher level of loans
outstanding. Operating Profit in the Consumer Finance segment was unchanged for
the first nine months of 1996 as the effect of higher levels of loans
outstanding was offset by higher provisions for loan losses.
CORPORATE
Net Corporate Interest Expense decreased by $0.8 million and $4.6 million for
the three and nine months ended September 30, 1996, compared to the same periods
in 1995. The decreases in Net Corporate Interest Expense were primarily the
result of a $300 million extraordinary dividend paid from United to Unitrin,
Inc. in the third quarter of 1995. Proceeds from this dividend were used to
fund the Company's common stock repurchase program, to reduce borrowings under
the Company's revolving credit agreement and to purchase certain investment
securities from the Company's subsidiaries.
Other Corporate Expense decreased by $1.1 million and $7.1 million for the three
and nine months ended September 30, 1996, compared to the same periods in 1995,
due primarily to expenses incurred in 1995 attributed to an unsolicited merger
proposal.
7
<PAGE>
INVESTEES
Equity in Net Income of Investees increased by $1.8 million and $4.0 million for
the three and nine months ended September 30, 1996, compared the same periods in
1995 due to improved operating results at the investee companies.
Litton Industries, Inc. ("Litton") announced in the first quarter of 1996 that
it had agreed to acquire Steerage Corp. ("Steerage") and that it would issue
approximately 2.2 million shares of Litton common stock to affect the
combination utilizing the pooling of interests method of accounting. Litton
completed the Steerage acquisition in the second quarter of 1996 by instead
paying cash and utilizing the purchase method of accounting. Unitrin's results
were not affected by the completion of this transaction.
OTHER ITEMS
During the first nine months of 1996, the Company repurchased approximately 1.27
million shares of its common stock in open market transactions at an aggregate
cost of $60.6 million. The repurchases were made with general corporate funds.
At September 30, 1996, the unused commitment under the Company's revolving
credit agreement was $228 million. In addition, for the remainder of 1996, the
Company's subsidiaries would be able to pay approximately $62 million in
dividends to the Company without prior regulatory approval.
[This space left intentionally blank]
8
<PAGE>
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
3.1 Certificate of Incorporation (Incorporated herein by reference to
Exhibit 3.1 to Unitrin's Registration Statement of Form 10 dated
February 15, 1990.)
3.2 Amended and Restated By-Laws (Incorporated herein by reference to
Exhibit 3.2 to the Company's 1994 Annual Report on Form 10-K.)
4 Rights Agreement between the Company and First Chicago Trust Company
of New York, as rights agent, dated as of August 3, 1994 (incorporated
herein by reference to Exhibit 1 to the Company's Registration
Statement on Form 8-A dated August 3, 1994).
10.1 Unitrin, Inc. 1990 Stock Option Plan as amended and Restated
(Incorporated herein by reference to Exhibit 10.1 to the Company's
Annual Report on Form 10-K for the year ended December 31, 1995.)
10.2 Amendments, dated, May 1, 1996, to the Unitrin, Inc. 1990 Stock Option
Plan (Incorporated herein by reference to Exhibit 10.2 to the
Company's Quarterly Report on Form 10-Q for the quarter ended June 30,
1996.)
10.3 Unitrin, Inc. 1995 Non-Employee Director Stock Option Plan
(Incorporated herein by reference to Exhibit 10.3 to the Company's
Quarterly Report on Form 10-Q for the quarter ended September 30,
1995.)
10.4 Unitrin, Inc. Retirement Plan for Salaried Employees (Incorporated by
reference to Exhibit 10.2 to Unitrin's Annual Report on Form 10-K for
the year ended December 31, 1994.)
10.5 Amendment No. 1 to Unitrin, Inc. Retirement Plan for Salaried
Employees (Incorporated by reference to exhibit 10.3 to Unitrin's
Annual Report on Form 10-K for the year ended December 31, 1994.)
10.6 Amendment No. 2 to Unitrin, Inc. Retirement Plan for Salaried
Employees (Incorporated herein by reference to Exhibit 10.4 to
Unitrin's Annual Report on Form 10-K for the year ended December 31,
1995.)
10.7 Unitrin, Inc. Pension Equalization Plan (Incorporated by reference to
Exhibit 10.4 to Unitrin's Annual Report on Form 10-K for the year
ended December 31, 1994.)
10.8 Unitrin is a party to individual severance agreements (the form of
which is incorporated herein by reference to Exhibit 10.5 to the
Company's 1994 Annual Report on Form 10-K), with the following
executive officers:
Jerrold V. Jerome (Chairman)
Richard C. Vie (President and Chief Executive Officer)
David F. Bengston (Vice President)
James W. Burkett (Vice President)
Thomas H. Maloney (Vice President and General Counsel)
Eric J. Draut (Treasurer)
(Note: Each of the foregoing agreements is identical except that the
severance compensation multiple is 2.99 for Messrs. Jerome and Vie and
2.0 for the other executive officers. The term of these agreements has
been extended by action of Unitrin's board of directors through
December 31, 1996.)
10.9 Severance Compensation Plan After Change of Control (Incorporated
herein by reference to Exhibit 10.6 to the Company's 1994 Annual
Report on Form 10-K; the term of this plan has been extended by
Unitrin's board of directors through December 31, 1996.)
10.10 Credit Agreement, dated January 24, 1995 among Unitrin, Inc.,
NationsBank, N.A. (Carolinas), The First National Bank of Chicago and
First Interstate Bank of California (Incorporated by reference to
Exhibit 10.7 to Unitrin's Annual Report on Form 10-K for the year
ended December 31, 1994.)
10.11 First Amendment to Credit Agreement, dated July 14, 1995 (Incorporated
herein by reference to Exhibit 10.10 to the Company's Quarterly Report
on Form 10-Q for the quarter ended September 30, 1995.)
10.12 Tax Allocation Agreement by and among Company and its Subsidiaries and
Teledyne, Inc. (Incorporated by reference to Amendment No. 1, dated
April 5, 1990, on Form 8 to the Company's Registration Statement on
Form 10.)
27 Financial Data Schedule
(b) Reports on Form 8-K.
No reports on Form 8-K were filed by the Company during the quarter ended
September 30, 1996.
9
<PAGE>
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 thereunto duly authorized.
Unitrin, Inc.
Date: October 23, 1996 /s/ Richard C. Vie
--------------------------------------
Richard C. Vie
President and Chief Executive Officer
Date: October 23, 1996 /s/ Eric J. Draut
--------------------------------------
Eric J. Draut
Treasurer and Controller
10
<PAGE>
Exhibit Index
3.1 Certificate of Incorporation (Incorporated herein by reference to
Exhibit 3.1 to Unitrin's Registration Statement on Form 10 dated
February 15, 1990.)
3.2 Amended and Restated By-Laws (Incorporated herein by reference to
Exhibit 3.2 to the Company's 1994 Annual Report on Form 10-K.)
4 Rights Agreement between the Company and First Chicago Trust Company
of New York, as rights agent, dated as of August 3, 1994 (incorporated
herein by reference to Exhibit 1 to the Company's Registration
Statement on Form 8-A dated August 3, 1994).
10.1 Unitrin, Inc. 1990 Stock Option Plan as amended and Restated
(Incorporated herein by reference to Exhibit 10.1 to the Company's
Annual Report on Form 10-K for the year ended December 31, 1995.)
10.2 Amendments, dated, May 1, 1996, to the Unitrin, Inc. 1990 Stock Option
Plan (Incorporated herein by reference to Exhibit 10.2 to the
Company's Quarterly Report on Form 10-Q for the quarter ended June 30,
1996.
10.3 Unitrin, Inc. 1995 Non-Employee Director Stock Option Plan
(Incorporated herein by reference to Exhibit 10.3 to the Company's
Quarterly Report on Form 10-Q for the quarter ended September 30,
1995.)
10.4 Unitrin, Inc. Retirement Plan for Salaried Employees (Incorporated by
reference to Exhibit 10.2 to Unitrin's Annual Report on Form 10-K for
the year ended December 31, 1994.)
10.5 Amendment No. 1 to Unitrin, Inc. Retirement Plan for Salaried
Employees (Incorporated by reference to Exhibit 10.3 to Unitrin's
Annual Report on Form 10-K for the year ended December 31, 1994.)
10.6 Amendment No. 2 to Unitrin, Inc. Retirement Plan for Salaried
Employees (Incorporated herein by reference to Exhibit 10.4 to
Unitrin's Annual Report on Form 10-K for the year ended December 31,
1995.)
10.7 Unitrin, Inc. Pension Equalization Plan (Incorporated by reference to
exhibit 10.4 to Unitrin's Annual Report on Form 10-K for the year
ended December 31, 1994.)
10.8 Unitrin is a party to individual severance agreements (the form of
which is incorporated herein by reference to Exhibit 10.5 to the
Company's 1994 Annual Report on Form 10-K), with the following
executive officers:
Jerrold V. Jerome (Chairman)
Richard C. Vie (President and Chief Executive Officer)
David F. Bengston (Vice President)
James W. Burkett (Vice President)
Thomas H. Maloney (Vice President and General Counsel)
Eric J. Draut (Treasurer)
(Note: Each of the foregoing agreements is identical except that the
severance compensation multiple is 2.99 for Messrs. Jerome and Vie and
2.0 for the other executive officers. The term of these agreements has
been extended by action of Unitrin's board of directors through
December 31, 1996.)
10.9 Severance Compensation Plan After Change of Control (Incorporated
herein by reference to Exhibit 10.6 to the Company's 1994 Annual
Report on Form 10-K; the term of this plan has been extended by
Unitrin's board of directors through December 31, 1996.)
10.10 Credit Agreement, dated January 24, 1995 among Unitrin, Inc.,
NationsBank, N.A. (Carolinas), The First National Bank of Chicago and
First Interstate Bank of California (Incorporated by reference to
Exhibit 10.7 to Unitrin's Annual Report on Form 10-K for the year
ended December 31, 1994.)
10.11 First Amendment to Credit Agreement, dated July 14, 1995 (Incorporated
herein by reference to Exhibit 10.10 to the Company's Quarterly Report
on Form 10-Q for the quarter ended September 30, 1995.)
10.12 Tax Allocation Agreement by and among Company and its Subsidiaries and
Teledyne, Inc. (Incorporated by reference to Amendment No. 1, dated
April 5, 1990, on Form 8 to the Company's Registration Statement on
Form 10.)
27 Financial Data Schedule
11
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 7
<LEGEND> This schedule contains summary financial information extracted from
the Condensed Consolidated Financial Statements and is qualified in its entirety
by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<DEBT-HELD-FOR-SALE> 2,263,200
<DEBT-CARRYING-VALUE> 0
<DEBT-MARKET-VALUE> 0
<EQUITIES> 246,400
<MORTGAGE> 0
<REAL-ESTATE> 0
<TOTAL-INVEST> 3,311,400
<CASH> 11,800
<RECOVER-REINSURE> 0
<DEFERRED-ACQUISITION> 0
<TOTAL-ASSETS> 4,887,900
<POLICY-LOSSES> 2,038,000
<UNEARNED-PREMIUMS> 0
<POLICY-OTHER> 0
<POLICY-HOLDER-FUNDS> 0
<NOTES-PAYABLE> 129,100
<COMMON> 3,700
0
0
<OTHER-SE> 1,445,000
<TOTAL-LIABILITY-AND-EQUITY> 4,887,900
917,200
<INVESTMENT-INCOME> 133,500
<INVESTMENT-GAINS> 1,600
<OTHER-INCOME> 89,200
<BENEFITS> 603,300
<UNDERWRITING-AMORTIZATION> 0
<UNDERWRITING-OTHER> 453,200<F1>
<INCOME-PRETAX> 85,000
<INCOME-TAX> 28,500
<INCOME-CONTINUING> 93,000<F2>
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 93,000
<EPS-PRIMARY> 2.46
<EPS-DILUTED> 0
<RESERVE-OPEN> 0
<PROVISION-CURRENT> 0
<PROVISION-PRIOR> 0
<PAYMENTS-CURRENT> 0
<PAYMENTS-PRIOR> 0
<RESERVE-CLOSE> 0
<CUMULATIVE-DEFICIENCY> 0
<FN>
<F1> Includes Consumer Finance Expenses of $73,100 and Interest and Other
Expenses of $11,700.
<F2> Includes Equity in Net Income of Investees of $36,500.
</FN>
</TABLE>
